The Montgomery County Council enacted three measures yesterday designed to stem the tide of condiminium concersions by speculators and ease the plight of low-income and elderly renters forced to move when their apartments are converted to condominiums.
The measures are designated emergency legislation so they will be in effect when a four-month moratorium on conversions expires this Friday.
The council, which has tried for months to find a way to slow conversions, became increasingly concerned over the decreasing number of rental housing units for low-income and elderly residents.
The first measure approved yesterday provides that the individuals who convert a property to condominiums must own it before filing the complex report required in order for condominium sales to proceed. This law was proposed by County Executive Charles W. Gilchrist on Oct. 19.
Under the old law, a developer could give notice of conversion after contracting to buy a building, then decide against the purchase. This created special hardships for renters who had been given a six-month notice to move, only to find that their apartments weren't going to be converted to condominiums after all.
The new legislation gives tenants longer to decide whether they want to buy their apartment buildings.
The second measure provides a one-year warranty on an appartment's fixtures, equipment and building materials and a three-year warranty on the common elements of a condomimium project.
The third measure provides that elderly, disabled or low-income tentants -- whose leases would otherwise terminate while they are under notice that conversion is being undertaken, are entitled to have their leases extended for 360 days. This would also give tenants a longer time to decide whether they want to purchase units in the condominium. The county's so-called first-right-of-refusal law already gives tenants 120 days to make that decision. The new law effectively extends this period to one year.
An amendment extending the period to two years may be enacted in two weeks.
The emergency bills are expected to be signed by Gilchrist today and are retroactive to Oct. 19.
County officials say a court challenge to the legislation is considered likely. The moratorium on conversions and the first-right-of-refusal laws are already being challenged by the local Chamber of Commerce and real estate groups, which claim the laws are unconstitutional.
The bills enacted yesterday are seen as an interim solution to the county's complex condominium conversion problems.
As a long-range solution, Gilchrist announced last week he will ask the Maryland legislature to approve a 4 percent transfer tax that would be paid by the initial seller of a condominium unit in Montgomery. If approved, the transfer tax would probably go into effect next spring at the earliest.