Proposed Maryland Legislation To Regulate Property Managers Includes Bond or Insurance Requirements

Legislation pending in the 2014 session of the Maryland General Assembly to regulate property managers of residential communities includes provisions that would require property managers to file a fidelity bond or proof of insurance with the Secretary of the Department of Licensing and Regulation.  House Bill 10, in addition to requiring that property managers be licensed, would require that any property manager entering into a contract to provide management services to a condominium, cooperative or homeowners association file proof of a fidelity bond, theft insurance, or other comparable written insurance as may be required by the proposed State Board of Common Ownership Community Managers.  The bond or insurance would be required to provide coverage in the lesser amount of $2 million or the highest aggregate amount of the operating and reserve balances of the community under the contract during the prior three months.

4 Comments


  1. Ray: I think SB 274 is a registration bill that requires the company to provide among other things proof of insurance, not a licensing bill. I think the definitions for management services in the bill are much too broad as they grant the manager the ability to act with the authority of the common interest community in negotiating contracts, financial matters and community issues. I would like to see the terms of the management contract be submitted with the registration and require the manager to report to the community on a regular basis, because more transparency is needed in the management process, not less. This bill allows for public access to relevant
    information the State develops relating to community management companies. Community management is an administrative service in support of the governing body and I believe that SB 274 will demonstrate, as the Department reviews its findings, the true nature of community management and a more sensible cost effective approach to regulating the role of the manager.

    The licensing bill, HB 10 is more of the same that has been offered and failed over the past 5 years. It is a bloated expensive system that will add cost to the employee, the company and the consumer. In an effort to reduce the cost the manager will pay, CAI and the proponents of the bill are establishing new classes of licenses for other if not all employees of the management company and requiring management company’s clients to contribute as well.

    It is often said that Registration is the first step to licensing and that may be true, but it is an important step. We will all benefit from a clear understanding of the services the management company is providing as well as how the State should assist the Board in the management of their community.

    Mel Herzberger


    1. Thank you Mel. The current version of the Senate Bill 274 is, indeed, quite different than House Bill 10. You are correct that it would provide only for registration of property managers with the Department of Licensing and Regulation. Thanks for reading.


  2. Is there a governing board for property managers in Maryland? I suspect my property manager is collecting more than she tells the owner I am paying


    1. There is no such board. Legislation has been introduced several times in the General Assembly that would establish a licensing and regulatory board for property managers, but it has not been enacted.

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