The principal purpose of 2017 Wisconsin Act 303 was to set limits on the amount of fees that an association can charge its unit owners. Those fees are the following:
- The actual cost of, but not more than $50, for providing the Sec. 703.33(1)(1m) & (2) Wis. Stat. disclosures from a Seller to a Buyer (See, Sec. 703.20(2)(a) Wis. Stat.);
- The actual cost of, but not more than $15, for providing any change to item 1 above as required by Sec. 703.33(3m) Wis. Stat. (See, Sec. 703.20(2)(a) Wis. Stat.); and
- No charge for a payoff statement, but if a second one is requested in a 2-month period, then not to exceed $25 (See Sec. 703.335(4)(a) Wis. Stat.).
The sole exception to these limits is if the association has a unit owner meeting where a greater fee is approved and the appropriate notices are provided both before and within 48 hours after the meeting. (See Sec. 703.205(2) Wis. Stat.).
There is no limit on the amount that may be charged as a transfer fee, but the new law does require that these amounts be disclosed in the Executive Summary. Specifically, it requires the following additions or changes to your Executive Summary under Sec. 703.33(1)(h) Wis. Stat. at the subsections noted:
- 703.33(1)(h)11. – 11. `Reserves.’ In addition to the prior requirements the association must also disclose the amount of the reserve balance.
- 703.33(1)(h)11m. 703.33(1)(h)13. – 13. `First right of purchase.’ Whether the association has a first right to purchase the unit.
- 703.33(1)(h)14. – 14. `Transfer fee.’ Whether the association charges a fee in connection with a transfer of ownership of the unit and, if a fee is charged, the amount of the fee.
- 703.33(1)(h)15. – 15. `Disclosure material fee.’ Whether the association charges a fee for providing the disclosure materials described in this section and, if a fee is charged, the amount of the fee.
- 703.33(1)(h)16. – 16. `Payoff statement fee.’ Whether the association charges a fee for providing a payoff statement under Sec. 703.335 and, if a fee is charged, the amount of the fee.
So at the end of the day, relative to this new law, every Association MUST amend its Executive Summary to comply with the new requirements. In addition, if you wish to charge fees greater than allowed by the statute, then you must obtain unit owner consent at a properly noticed meeting.
Fees not Included in the New Law. What is not in the law is any reference to charging for either (1) transfer fees (other than stating the amount in Executive Summary) or (2) fees for preparing mortgagee, title company or real estate agent questionnaires. So apparently those can be set at market rates without governmental oversite – at least for now.
For more information on these new laws, download this white paper. Should you have any questions on the new law, please be certain to contact your attorney.