Bill Text: NJ S1532 | 2018-2019 | Regular Session | Introduced
Bill Title: Limits time continuing care retirement communities may retain refundable entrance fee after resident vacates facility; provides for disposition of certain personal property.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2018-07-01 - Substituted by A2747/880 (ACS/3R) [S1532 Detail]
Download: New_Jersey-2018-S1532-Introduced.html
Sponsored by:
Senator CHRISTOPHER "KIP" BATEMAN
District 16 (Hunterdon, Mercer, Middlesex and Somerset)
SYNOPSIS
Limits time continuing care retirement communities may retain refundable entrance fee after resident vacates facility; provides for disposition of certain personal property.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the return of continuing care retirement community refundable entrance fees and amending P.L.2013, c.167.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 7 of P.L.2013, c.167 (C.52:27D-360.7) is amended to read as follows:
7. a. (1) A resident may, upon 60-days' written notice of the intent to vacate, cancel the continuing care agreement for any reason.
(2) Upon vacating the unit, a resident or resident's estate cancelling a continuing care agreement also shall provide written notice to the owner or manage of that facility that the unit is vacated. The notice shall declare that all personal property of the resident or estate thereof has been removed.
(3) After a unit is vacated, the facility may restore the unit to its original condition. If any personal property of the prior resident remains in the unit, the facility may continue to impose monthly fees until the property is removed, and the facility may remove any such property beginning on the twenty-first day following the date upon which notice of vacancy was received.
(4) In the case of a continuing care agreement that provides for a refundable entrance fee, the facility shall assign the vacated unit a sequential number among all the available units with refundable entrance fees once the unit is restored pursuant to paragraph (3) of this subsection, but not later than 60 days following receipt of the notice that the unit is vacated.
b. Upon cancellation of the continuing care agreement by either the resident or the facility, the resident shall have the right to receive a refund of the amount of any entrance fee as provided in the continuing care agreement. The amount of the entrance fee shall be set forth in a clear and conspicuous manner in the continuing care agreement.
c. A resident shall be provided at least 60-days' written notice from the facility if the resident's continuing care agreement is being cancelled due to a violation of the facility's rules or regulations. Notification may be waived if the facility can demonstrate just cause for terminating the continuing care agreement in accordance with N.J.A.C.5:19-6.5(c). The resident may challenge the facility's notice of continuing care agreement cancellation by requesting a hearing in the same manner as for a hearing in a contested case pursuant to section 9 of P.L.1968, c.410 (C.52:14B-9).
d. In a continuing care agreement that provides for a refundable entrance fee, when a resident permanently vacates the facility, or, in the case of two residents occupying the same residence, when both vacate at the same time, the facility shall provide to the resident or residents or the legal representative of the resident's estate, whichever is applicable, a refund of the refundable entrance fee amount without interest, as set forth in the agreement. Any unpaid fees or charges incurred by the resident including unpaid monthly service fees, as well as the amount of any charitable assistance that the facility has provided to the resident, may also be deducted from the remaining balance of the refund of the entrance fee. Any balance to the resident shall be payable [within 60 days from the date the residence is resold and the entrance fee from the new resident has been received] based upon the order of the sequential number assigned to a unit pursuant to paragraph (4) of subsection a. of this section and the availability of funds from the proceeds of the resale of all vacated units with refundable entrance fees.
e. When an entrance fee deposit is refundable, it shall be paid to either the resident, the resident's named beneficiary, or the legal representative of the resident's estate, whichever is applicable. A resident shall have the right to change, in writing, the named beneficiary for the entrance fee refund at any time.
(cf: P.L.2013, c.167, s.7)
2. This act shall take effect immediately.
STATEMENT
This bill limits the time that a continuing care retirement community may retain a refundable entrance fee after a resident vacates the facility and provides for disposition of personal property left by a resident who has vacated the facility.
Under current law, a continuing care retirement community may retain an entrance fee for as long as it takes for the unit to be reoccupied by another resident. Absent a maximum refunding period, there is little incentive for the facility managers to aggressively market any particular vacant unit. In some instances, a facility has retained the fee for several years after the unit has been vacated, unreasonably delaying the return of the fee. Further, if the resident has died, an estate may be forced to pay distribution taxes on money representing the fee refund, years before the estate and beneficiaries receive that fee refund.
This bill provides that upon a unit being vacated, the resident or resident's estate is required to provide the facility with written notice that: (1) the unit is vacated; and (2) all personal property has been removed. After a unit is vacated, the bill authorizes the facility restore the unit to its original condition.
In the case of a continuing care agreement that provides for a refundable entrance fee, the bill requires the facility to assign the vacated unit a sequential number among all the available units with refundable entrance fees once the unit is restored to original condition, but not later than 60 days following receipt of the notice that the unit is vacated.
Under the bill, a refundable fee owed to a resident or resident's estate for a unit that has been so numbered will be payable based upon the order of the sequential number assigned to the unit section and the availability of funds from the proceeds of the resale of all vacated units with refundable entrance fees.
Additionally, the bill provides that if any personal property of a prior resident remains in a vacated unit, the facility may continue to impose monthly fees until the property is removed, and the facility may remove any personal property beginning on the twenty-first day following the date upon which notice of vacancy was received.
