Regulatory News

INCREASE IN SALARY THRESHOLD FOR EXEMPT EMPLOYEES. The U.S. Department of Labor approved regulations to increase the threshold salary for exempt (salaries) employees. 

Current- $35,568

July 1, 2024 – $43,888

Jan. 1, 2025 – $58,656

Starting July 1, the eligibility thresholds will be updated every three years based on current wage data. 

NO MORE NON-COMPETES: On April 23, the Federal Trade Commission voted to ban non-competes. The FTC voted 3-2 to ban non-compete agreements in all new employment contracts and overturn existing contractual agreements other than for senior executives.

BULK BILLING ARRANGEMENTS:  The chair of the Federal Communications Commission signaled an effort to ban or substantially change the ability for multi-family housing entities (apartments, condominiums, housing cooperatives, and homeowners associations) to enter bulk billing arrangements for broadband services. Bulk billing arrangements provide lower cost access to higher speed and quality broadband services for homeowners. Visit www.caionline.org/takeaction to let your member of Congress and/or the FCC know why bulk billing is important to your community. 

       Mortgage Lending for Condominiums – Fannie Mae & Freddie Mac

Fannie Mae and Freddie Mac continue to make minor modifications to lending guidelines in condominium associations and housing cooperatives. Modifications include provisions for reserve studies and funding, inspections, and insurance requirements.  If you are experiencing lender delays or rejections in your condominium or housing cooperative community, let CAI know so we can share the information with Fannie Mae and Freddie Mac.  Take a brief survey at www.caionline.org/takeaction 

Fannie Mae and Freddie Mac have released additional information on ineligible projects to boards and their designated agents. Visit the CAI Advocacy Blog and search for Freddie Mac for more information.  advocacy.caionline.org 

Corporate Transparency Act

The Corporate Transparency Act is still the law for community associations. Communities must  comply and file Beneficial Ownership Information (BOI) by Dec. 31.

There is a lot of activity in the courts, active legislation in Congress, and regulatory guidance from the Financial Crimes Enforcement Network.  I’ll break it down here. 

THE COURTS
On March 1, the Federal District Court in Alabama ruled the Corporate Transparency Act unconstitutional. The plaintiffs in the case are a small business owner and the National Small Business Association. The defendant, the Department of Treasury,  immediately announced the court ruling only applies to the NSBA and the business owner.  In other words, and importantly, the corporate transparency act still applies to community associations. As expected, the Department of Treasury appealed the court ruling and asked the court to expedite the appeal.  CAI submitted an amicus brief in the case. 

Additional lawsuits have been filed by other organizations. These lawsuits created chaos and confusion. Nonetheless, community associations must comply by Dec. 31. 

CONGRESS

There are two pieces of legislation in Congress that, if passed before the end of the session, will help community associations. 

DELAY: S. 3625, the Senate companion bill to H.R. 5119 that passed the House of Representatives 400-1 is still in play.  CAI continues to meet with Senate Democrats on the Senate Banking Committee to urge them to delay implementation of BOI filing by one year. Senate Republicans are willing to pass this bill, but Senate Democrats aren’t willing to budge. 

REPEAL: The House is frustrated by the Senate’s lack of movement, so it introduced another bill, H.R. 8147, that will repeal the Corporate Transparency Act. This is a Republican dominated bill in the House.

Visit www.caionline.org/takeaction to contact your member of Congress today. 

DEPARTMENT OF TREASURY FINANCIAL CRIMES ENFORCEMENT NETWORK 

CAI met with FinCEN in mid-April to discuss the exemption request for community associations sent to the Department of Treasury in Dec. 2023. The FinCEN staff let CAI stakeholders know no exemptions are being considered at this time.  The Department of Treasury has received numerous requests by different groups requesting exemptions. FinCEN staff say no additional exemptions have been authorized or approved by FinCEN. The staff believes Congress made the exemptions in the act extensive, and FinCEN is will “let things play out” without approving additional exemptions.  The staff at FinCEN made it clear they are charged with carrying out the policy requirements of the act. 

FinCEN released specific FAQs for homeowners associations that may be found here. https://www.fincen.gov/boi-faqs

THE BOTTOM LINE 

As of now, most community associations must comply and be prepared to file by Dec. 31 unless you qualify for an exemption (see note below or are otherwise not incorporated in a manner that requires compliance (ask your attorney).

CAI recognizes the many challenges related to these requirements such as the sharing of personal information in a government database, the burden on volunteer board members, and the exposure to criminal penalties and fines. The one piece of positive news is the administrative filing process for boards is straightforward. Board members can obtain their own FINCEN number (like a tax id number), and provide it to an individual (board member, management, attorney, consultant, the board’s chosen agent) to prepare the entire filing for the association. 

CAI continues to request an exemption for community associations and urge Congress to delay or repeal this legislation for community associations. 

Disaster Assistance Fairness Act

CAI continues to advocate for fairness in receiving Federal Emergency Management Agency resources for community associations impacted by a disaster. Since Congress hasn’t moved much legislation this year, we are using the 2025 appropriations bill (funding the government) to try to get support for community associations. 

Stay updated by visiting our Advocacy Blog. Feel free to contact our team with any questions at government@caionline.org