Does BC have Legislation?
The Strata Property Amendment Act, 2009 came into force on January 1, 2010. However, some of the provisions of the act required further development of the regulation before they came into force. On December 13, 2011 these regulations were completed and by Order in Council became law on that date. See the specific regulatory changes regarding BC Depreciation Reports.
LEgislated Deadlines in "plain english":
For strata corporations in existence on or before December 14, 2011, and comprising 5 or more units, a Depreciation Report is required by December 13th 2013, unless the strata corporation successfully votes to self-exempt, through a 75% vote of owners at an AGM or SGM.
Further self-exemptions would be required each year, if the goal is to defer the Depreciation Report requirement indefinitely. For strata corporations formed after December 14, 2011, the Depreciation Report deadline is within 6 months of your 2nd AGM.
This means all strata corporations of 5 units or greater and in existence as of December 14, 2011 must either self exempt this year prior to the deadline, or have their Depreciation Report complete by December 13th 2013. These reports are complex documents, and will take several weeks to a few months to finalize - therefore request your proposal ASAP.
Among these provisions, are amendments to Section 94, Depreciation Report (excerpt below), with the new regulations shown after each section in bold italics:
(1) In this section, "qualified person" has the meaning set out in the regulations.
For the purposes of section 94 (1) of the Act, “qualified person” means any person who has the knowledge and expertise to understand the individual components, scope and complexity of the strata corporation’s common property, common assets and those parts of a strata lot or limited common property, or both, that the strata corporation is responsible to maintain or repair under the Act, the strata corporation’s bylaws or an agreement with an owner and to prepare a depreciation report that complies with subsections (1) to (4).
(2) Subject to subsection (3), a strata corporation must obtain from a qualified person, on or before the following dates, a depreciation report estimating the repair and replacement cost for major items in the strata corporation and the expected life of those items:
(a) for the first time, the date that is 2 years after the coming into force of this section; December 13, 2013
(b) if the strata corporation has, before or after the coming into force of this section, obtained a depreciation report that complies with the requirements of this section, the date that is the prescribed period after the date on which that report was obtained;
For the purposes of section 94 (2) (b) of the Act, 3 years
(c) if the strata corporation has, under subsection (3) (a), waived the requirement under this subsection to obtain a depreciation report, the date that is the prescribed period after the date on which the resolution waiving the requirement was passed.
For the purposes of section 94 (2) (c) of the Act, 18 months
(3) A strata corporation need not comply with the requirement under subsection (2) to obtain a depreciation report on or before a certain date if
(a) the strata corporation, by a resolution passed by a 3/4 vote at an annual or special general meeting within the prescribed period, waives that requirement, or
For the purposes of section 94 (3) (a) of the Act, the one year period immediately preceding the date on or before which the depreciation report is required to be obtained.
(b) the strata corporation is a member of a prescribed class of strata corporations.
A strata corporation is prescribed for the purposes of section 94 (3) (b) of the Act if and for so long as there are fewer than 5 strata lots in the strata plan.
(4) A depreciation report referred to in subsection (2) must contain the information set out in the regulations.
May be found under section 6.2 of the Regulation.
In summary, most of British Columbia's 29,000+ strata corporations which comprise 5 or more strata lots are required to comply with the legislation to perform a “depreciation report” by December 13, 2013, unless the strata corporation passes a resolution by a ¾ vote to exempt themselves from the regulation. If an exemption passes, it will be valid for a period of 18 months, however, if the goal is to self-exempt again the following year, a new vote should be held after approximately 12 months at the next AGM/SGM. If this subsequent vote fails, there would be approximately 6 months remaining of the 18 month exemption period to have the depreciation report completed, in order to remain compliant with the Act.
Contact us today to discuss a Depreciation Report for your Strata Corporation.