New Jersey Strengthens the Structural Integrity of Its Residential Builds

Pillsbury - Gravel2Gavel Construction & Real Estate Law

In response to the June 2021 Champlain Towers collapse in Florida, New Jersey supplemented its State Uniform Construction Code Act by enacting legislation (effective January 8, 2024) to strengthen laws related to the structural integrity of certain residential structures in the State. The legislation applies to condominiums and cooperatives (but not single-family dwellings or primarily rental buildings) with structural components made of steel, reinforced concrete, heavy timber or a combination of such materials. The legislation also supplements the Planned Real Estate Development Full Disclosure Act to ensure that associations created under the Act maintain adequate reserve funds for certain repairs.

The legislation requires structural engineering inspections of any primary load-bearing system (structural components applying force to the building which deliver force to the ground including any connected balconies). Buildings that are constructed after the date the legislation was signed must have their first inspection within 15 years after receiving a Certificate of Occupancy. Buildings that are 15 years or older must be inspected within two years of the legislation. Thereafter, the structural inspector will determine when the next inspection should take place, which will be no more than 10 years after the preceding inspection, except for buildings more than 20 years old which must be inspected every five years. Also, if damage to the primary load-bearing system is otherwise observable, an inspection must be performed within 60 days.

Additionally, in order to ensure that planned real estate development associations have sufficient funds to make repairs, associations formed pursuant to the Planned Real Estate Full Disclosure Act (N.J.S.A. 45:22A-21, et seq.) must conduct a capital reserve study to assess the adequacy of reserve funds that would be necessary should there need to be significant repairs or replacement of common elements. The analysis must include reserve fund balances, anticipated income and expenses, an analysis of the physical status of the building and common areas, and anticipated costs associated with building maintenance and repair, among other items. Associations that have not undertaken a reserve study within five years of January 8, 2024, must do so within one year. Associations formed after January 8, 2024, must undertake a reserve study as soon as practicable after the election of a majority of an executive board, but no more than two years after such election. The study must be reviewed at least once every five years.

The legislation also contains requirements for a 30-year funding plan and allows certain associations to assess owners without their consent to fund the cost of certain corrective maintenance for primary load bearing systems.

Finally, the legislation also provides that a structural inspector who performs his or her duties in good faith and pursuant to appropriate protocols, shall not incur civil liability for injury associated with any inspection undertaken by that inspector.

Residential building owners and associations should carefully review and be mindful of these intricate changes.

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Pillsbury - Gravel2Gavel Construction & Real Estate Law

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