2013 Maryland Code
CORPORATIONS AND ASSOCIATIONS
§ 5-6B-05 - Notice of conversion to tenants

(a) Required; form. --

(1) At least 180 days before a tenant is required to vacate a portion of a residential rental facility used as a residence that is acquired or is to be acquired by a cooperative housing corporation or that is owned by or is to be owned by a corporation that may become a cooperative housing corporation, the owner and the landlord of each tenant in possession of a portion of the residential rental facility shall give the tenant a notice in substantially the form specified in subsection (f) of this section.

(2) For effective notice, the owner and the landlord, at least 15 days before giving the notice required by this section, shall file with the Secretary of State a copy of the notice, a list of the tenants to whom the owner and the landlord anticipate giving notice, and an affidavit in substantially the following form:

"I hereby affirm under the penalty of perjury that the notice
requirements of § 5-6B-05 of the Corporations and Associations Article,
if applicable, have been fulfilled.

Developer

By ........"

(3) If a tenant first leases a portion of the premises as a residence
after the notice required by this subsection has been given, the owner and the
landlord, if other than the owner, shall inform the tenant in writing that the
notice has been given. The tenant shall be so informed on or before signing
the lease or taking possession, whichever occurs first.

(b) Delivery. -- The notice shall be considered to have been given to each
tenant if delivered by hand or mailed, postage prepaid, to the tenant's last
known address.

(c) Terms for vacation of residents. -- A tenant leasing a portion of a
residential rental facility as a residence at the time the notice referred to
in subsection (a) of this section is given to the tenant may not be required
to vacate the premises prior to the expiration of 180 days from the giving of
the notice except for:

(1) Breach of a covenant in the lease occuring before or after the
notice is given;

(2) Nonpayment of rent occurring before or after the notice is given; or

(3) Failure of the tenant to vacate the premises at the time that is
indicated by the tenant in a notice given to the landlord under subsection (e)
of this section.

(d) Extension of lease terms. --

(1) If the lease term of a tenant who leases a portion of a residential
rental facility as a residence at the time the notice referred to in
subsection (a) of this section is given would ordinarily terminate during the
180-day period, the lease term shall be extended, at the option of the tenant,
until the expiration of the 180-day period.

(2) The extended term shall be at the same rent and on the same terms
and conditions as were applicable on the last day of the lease term.

(e) Termination of lease by tenant. -- A tenant who leases a portion of a
residential rental facility as a residence at the time the notice referred to
in subsection (a) of this section is given may terminate the lease, without
penalty for termination, upon at least 30 days' written notice to the landlord.

(f) Additional form. -- The notice referred to in subsection (a) of this
section shall be sufficient for the purposes of this section if it is in
substantially the following form. As to rental facilities containing fewer
than 10 units, "Section 2" of the notice is not required to be given.

"NOTICE OF INTENTION TO CREATE A
COOPERATIVE HOUSING CORPORATION

................... (date)

This is to inform you that the residential rental facility known as
................... has been or may be acquired by a cooperative housing
corporation or that the current owner of the residential rental facility has
or may become a cooperative housing corporation in accordance with the
Maryland Cooperative Housing Corporation Act. You may be required to move out
of your residence after 180 days have passed from the date of this notice, or
in other words, after .............. (date).

Section 1
Rights that Apply to All Tenants

If you are a tenant in this residential rental facility and you have not
already given notice that you intend to move, you have the following rights,
provided you have previously paid your rent and continue to pay your rent and
abide by the other terms and conditions of your lease.

(1) You may remain in your residence on the same rent, terms, and
conditions of your existing lease until either the end of your lease term or
until .............. (date) (the end of the 180-day period), whichever is
later. If your lease term ends during the 180-day period, it will be extended
on the same rent, terms, and conditions until .............. (date) (the end
of the 180-day period). In addition, certain households may be entitled to
extend their leases beyond the 180 days as described in Section 2.

(2) You have the right to purchase your residence before it can be sold
publicly. A purchase offer describing your right to purchase is included with
this notice.

(3) If you do not choose to purchase your residence, and the annual
income for all present members of your household did not exceed
.............. (the income eligibility figure for the appropriate area which
equals approximately 80 percent of the median income for your county or
standard metropolitan area) for 20 , you are entitled to receive $ 375 when
you move out of your residence. You are also entitled to be reimbursed for
moving expenses, as defined in the Maryland Cooperative Housing Corporation
Act, over $ 375 up to $ 750 which are actually and reasonably incurred. If the
annual income for all present members of your household did exceed
.............. (the income eligibility figure for the appropriate area which
equals approximately 80 percent of the median income for your county or
standard metropolitan area) for 20 , you are entitled to be reimbursed up to
$ 750 for moving expenses, as defined in the Maryland Cooperative Housing
Corporation Act, actually and reasonably incurred. To receive reimbursement
for moving expenses, you must make a written request, accompanied by
reasonable evidence of your expenses, within 30 days after you move. You are
entitled to be reimbursed within 30 days after your request has been received.

(4) If you want to move out of your residence before the end of the
180-day period or the end of your lease, you may cancel your lease without
penalty by giving at least 30 days' prior written notice. However, once you
give notice of when you intend to move, you will not have the right to remain
in your residence beyond that date.

Section 2
Right to 3-Year Lease Extension or
3-Month Rent Payment for Certain
Handicapped Citizens and Senior Citizens

The developer who converts this residential rental facility to a
cooperative housing corporation must offer extended leases to qualified
households for up to 20 percent of the units in the residential rental
facility. Households which receive extended leases will have the right to
continue renting their residences for at least 3 years from the date of this
notice. A household may cancel an extended lease by giving 3 months' written
notice if more than 1 year remains on the lease, and 1 month's written notice
if 1 year or less remains on the lease.

Rents under these extended leases may be increased only once each year and
are limited by increases in the cost of living index. Read the enclosed lease
to learn the additional rights and responsibilities of tenants under extended
leases.

In determining whether your household qualifies for an extended lease, the
following definitions apply:

(1) "Handicapped citizen" means a person with a measurable limitation of
mobility due to congenital defect, disease, or trauma.

(2) "Senior citizen" means a person who is at least 62 years old on the
date of this notice.

(3) "Annual income" means the total income from all sources for all
present members of your household for the income tax year immediately
preceding the year in which this notice is issued, whether or not included in
the definition of gross income for federal or State tax purposes. For purposes
of this section, the inclusions to and exclusions from annual income are the
same as for "gross income" as that term is defined in § 9-104(a)(8) of the Tax
- Property Article for the property tax credits for homeowners by reason of
income and age, reduced by unreimbursed medical expenses if the tenant
provides reasonable evidence of the unreimbursed medical expenses or consents
in writing to authorize disclosure of relevant information regarding medical
expense reimbursement at the time of applying for an extended lease. Total
income means the same as "gross income" as defined in § 9-104(a)(8) of the Tax
- Property Article.

To qualify for an extended lease you must meet all of the following
criteria:

(1) A member of the household must be a handicapped citizen or a senior
citizen and must be living in your unit as of the date of this notice and must
have been a member of your household for at least the 12 months immediately
preceding the date of this notice;

(2) Annual income for all present members of your household must not
have exceeded .............. (80 percent of applicable median income) for
20 ; and

(3) You must be current in your rental payment and otherwise be in good
standing under your existing lease.

If you meet all of these qualifications and you desire an extended lease,
then you must complete the enclosed form and execute the enclosed lease and
return the completed form and executed lease to the office listed below within
60 days after the date of this notice, or in other words, by ...........
(date). If your completed form and executed lease are not received within that
time, you will not be entitled to an extended lease.

If the number of qualified households requesting extended leases exceeds
the 20 percent limitation, the extended leases shall be allocated as
determined by the local governing body. If the local governing body fails to
provide for allocation, units shall be allocated by the developer based on
seniority by continuous length of residence.

Due to the 20 percent limitation your application for an extended lease
must be processed before your lease becomes effective. Your lease will become
effective if it is determined that your household is qualified and falls
within the 20 percent limitation.

If you return the enclosed form and lease by ......... (date), you will be
notified within 75 days after the date of this notice, or in other words, by
......... (date), whether you are qualified and whether your household falls
within the 20 percent limitation.

You may apply for an extended lease and, at the same time, choose to
purchase a cooperative interest. If you apply for and receive an extended
lease, your contract will be void. If you do not receive an extended lease,
your contract will be effective and you will be obligated to purchase a
cooperative interest.

If you qualify for an extended lease, but due to the 20 percent limitation,
your lease is not effective, the developer must pay you an amount equal to 3
months' rent within 15 days after you move. You are also entitled to up to $
750 reimbursement for your moving expenses, as described in Section 1.

If you qualify for an extended lease, but do not want one, you are also
entitled to both the moving expense reimbursement previously described and the
payment equal to 3 months' rent. In order to receive the 3 months' rent
payment, you must complete and return the enclosed form within 60 days after
the date of this notice or by ........... (date), but you should not execute
the enclosed lease.

All applications, forms, executed leases, and moving expense requests
should be addressed or delivered to:

...............................

...............................

................................"

(g) Failure of landlord or owner to give notice. -- The failure of a landlord or owner to give notice as required by this section is a defense to an action for possession.

(h) Applicability to tenants giving written notice of intent not to renew before notice given. -- This section does not apply to a tenant whose lease term expires during the 180-day period and who has given written notice of intent not to renew the lease before the notice required by subsection (a) of this section is given.

(i) Waiver of rights by tenants. -- A tenant may not waive the rights under this section except as otherwise provided under this subtitle.

(j) Conversion to month to month tenancy. -- At the expiration of the 180-day period a tenant shall become a tenant from month-to-month subject to the same rent, terms, and conditions as those existing at the giving of the notice required by subsection (a) of this section, if the tenant's initial lease has expired and the tenant has not:

(1) Entered into a new lease;

(2) Vacated under subsection (e) of this section; or

(3) Been notified in accordance with applicable law prior to the expiration of the 180-day period that the tenant must vacate at the end of that period.