2010 Pennsylvania Code
Title 68 - REAL AND PERSONAL PROPERTY
Chapter 54 - Protection of Purchasers
5402 - Public offering statement; general provisions.

     § 5402.  Public offering statement; general provisions.
        (a)  General rule.--Except as provided in subsection (b), a
     public offering statement must contain or fully and accurately
     disclose:
            (1)  The name and principal address of the declarant and
        of the planned community.
            (2)  A general description of the planned community,
        including, without limitation, the types, number and
        declarant's schedule of commencement and completion of
        construction of all buildings, units and amenities.
            (3)  A narrative description of the type and character of
        units offered, including a statement of the degree of
        completion to be provided or undertaken by the declarant of
        such units and the common elements necessary for use and
        enjoyment of such units upon the conveyance by the declarant
        of units offered.
            (4)  The total number of additional units that may be
        included in the planned community and the proportion of units
        the declarant intends to rent or market in blocks of units to
        investors.
            (5)  A brief narrative description of any options
        reserved by a declarant to withdraw withdrawable real estate
        under section 5206(1) (relating to contents of declaration
        for flexible planned communities) and the expected effect
        that withdrawal would have on the remaining portion of the
        planned community.
            (6)  Copies and a brief narrative description of the
        significant features of the declaration, other than the plats
        and plans, and the bylaws, rules and regulations, agreement
        of sale, copies of any contracts and leases to be signed by
        the purchasers prior to or at closing and a brief narrative
        description of any other contracts or leases or agreements of
        a material nature to the planned community that will or may
        be subject to cancellation by the association under section
        5305 (relating to termination of contracts and leases of
        declarant).
            (7)  Any current balance sheet and a projected budget for
        the association, either within or as an exhibit to the public
        offering statement, for one year after the date of the first
        conveyance to a purchaser and thereafter the current budget
        of the association, a statement of who prepared the budget
        and a statement of the budget's material assumptions,
        including those concerning occupancy and inflation factors.
        The budget must include, without limitation:
                (i)  A statement of the amount, or a statement that
            there is no amount, included in the budget as a reserve
            for repairs and replacement.
                (ii)  A statement containing a description of any
            provisions made in the budget for reserves for
            anticipated material capital expenditures or any other
            reserves or, if no provision is made for reserves, a
            statement to that effect.
                (iii)  The projected common expense assessment by
            category of expenditures for the association.
                (iv)  The projected monthly common expense assessment
            for each type of unit.
            (8)  Any of the following:
                (i)  Services not reflected in the budget that the
            declarant provides or expenses that the declarant pays
            and that the declarant expects may become at any
            subsequent time a common expense of the association.
                (ii)  Personal property not owned by the association
            but provided by the declarant and being used or to be
            used in the operation and enjoyment of the common
            elements which is or will be required in connection with
            the operation and enjoyment of the common elements after
            such personal property is no longer provided by the
            declarant and the projected common expense assessment for
            the association and for each type of unit attributable to
            each of those services or expenses and purchase or rental
            of such personal property.
            (9)  Any initial or special fee due from the purchaser at
        closing, together with a description of the purpose and
        method of calculating the fee.
            (10)  A description of any liens, defects or encumbrances
        on or affecting the title to the planned community.
            (11)  A description of any financing for purchasers
        offered or arranged by the declarant.
            (12)  The terms and significant limitations of any
        warranties provided by the declarant, including statutory
        warranties and limitations on the enforcement thereof or on
        damages.
            (13)  A statement in at least ten-point boldface type,
        appearing on the first page of the public offering statement,
        as follows:
                (i)  That, within seven days after receipt of a
            public offering statement or an amendment to the public
            offering statement that materially and adversely affects
            the rights or obligations of the purchaser, the
            purchaser, before conveyance, may cancel any contract for
            purchase of a unit from a declarant.
                (ii)  That, if a declarant fails to provide a public
            offering statement and any amendments to a purchaser
            before conveying a unit, the purchaser may recover from
            the declarant damages as provided in section 5406(c)
            (relating to purchaser's right to cancel).
                (iii)  A description of damages under section
            5406(c).
                (iv)  That, if a purchaser receives the public
            offering statement more than seven days before signing a
            contract, the purchaser cannot cancel the contract unless
            there is an amendment to the public offering statement
            that would have a material and adverse effect on the
            rights or obligations of that purchaser.
            (14)  A statement of any judgments against the
        association, the status of any pending suits to which the
        association is a party and the status of any pending suits
        material to the planned community of which a declarant has
        actual knowledge.
            (15)  A statement that any deposit made in connection
        with the purchase of a unit will be held in an escrow account
        in accordance with the provisions of section 5408 (relating
        to escrow of deposits) and will be returned to the purchaser
        if the purchaser cancels the contract pursuant to section
        5406.
            (16)  Any restraints on alienation of any portion of the
        planned community.
            (17)  A description of all insurance coverage provided or
        intended to be provided, if such insurance is not then in
        effect, for the benefit of unit owners, including the types
        and extent of coverage and the extent to which such coverage
        includes or excludes improvements or betterments made to
        units, in accordance with section 5312 (relating to
        insurance).
            (18)  Any current or expected fees or charges to be paid
        by unit owners for the use of the common elements and other
        facilities related to the planned community.
            (19)  The extent to which financial arrangements have
        been provided for completion of all improvements labeled
        "MUST BE BUILT" under section 5414 (relating to declarant's
        obligation to complete and restore).
            (20)  All unusual and material circumstances, features
        and characteristics of the planned community and the units.
            (21)  In the case of a leasehold planned community, at
        least the following information:
                (i)  The name and address of each lessor and his
            assignee, if any.
                (ii)  Any relationship between the declarant and any
            lessor or assignee.
                (iii)  A description of the leased property.
                (iv)  The rent and any provision in the lease for
            increases in the rent and any other charges or payments
            required to be paid by the lessee under the lease.
                (v)  Whether the lessee has any right to terminate
            the lease.
                (vi)  The information contained in the declaration as
            required by section 5207(a) (relating to leasehold
            planned communities).
                (vii)  The following notice in boldface type:
                    "Purchasers should be aware that this is a
                    leasehold planned community, and the purchaser's
                    interest therein may be less valuable than a fee
                    interest, may depreciate over time and may be of
                    questionable marketability."
            (22)  A statement containing a declaration as to the
        present condition of all structural components and major
        utility installations in the subject property, including the
        dates of construction, installation and major repairs, if
        known or ascertainable, and the expected useful life of each
        item, together with the estimated cost in current dollars of
        replacing each of the same.
            (23)  A description of how votes are allocated among the
        units and a statement as to whether cumulative or class
        voting is permitted and, if so, under what circumstances. The
        statement shall also explain the operation of cumulative or
        class voting.
            (24)  A description of any circumstances under which the
        association is to become a master association or part of a
        master association.
            (25)  A statement of all governmental approvals and
        permits required for the use and occupancy of the planned
        community, indicating the name and expiration date of each
        such approval or permit that has been obtained and, as to any
        approvals or permits that have not been obtained, a statement
        indicating when each such approval or permit is expected to
        be obtained and the person responsible for the expense of
        obtaining each such approval or permit.
            (26)  A statement as to whether there are any outstanding
        and uncured notices of violations of governmental
        requirements and, if there are any such notices of
        violations, a description of the alleged violation and a
        statement indicating when each violation is expected to be
        cured and the person who shall bear the expense of curing
        such violation.
            (27)  A statement as to whether the declarant has
        knowledge of any one or more of the following:
                (i)  Hazardous conditions, including contamination,
            affecting the planned community site by hazardous
            substances, hazardous wastes or the like or the existence
            of underground storage tanks for petroleum products or
            other hazardous substances.
                (ii)  Any investigation conducted to determine the
            presence of hazardous conditions on or affecting the
            planned community site.
                (iii)  Any finding or action recommended to be taken
            in the report of any such investigation or by any
            governmental body, agency or authority, in order to
            correct any hazardous conditions and any action taken
            pursuant to those recommendations. If the declarant has
            no knowledge of such matters, the declarant shall make a
            statement to that effect. The declarant shall also set
            forth the address and phone number of the regional
            offices of the Department of Environmental Resources and
            the United States Environmental Protection Agency where
            information concerning environmental conditions affecting
            the planned community site may be obtained.
            (28)  A summary and description of all the provisions of
        the declaration for the planned community to comply with
        section 5205(16) (relating to contents of declaration; all
        planned communities).
            (29)  A statement identifying all facilities and
        amenities in the planned community which the declarant shall
        be obligated to complete and with respect thereto:
                (i)  The time within which each identified facility
            or amenity shall be completed.
                (ii)  Whether there is a source of funding to
            complete the facilities and amenities or any security for
            the completion, and a description of any such funding
            source and security.
                (iii)  Who will own the facilities and amenities to
            be completed by the declarant.
                (iv)  The responsibilities of unit owners and the
            association, respectively, for the maintenance, repair,
            improvement, administration and regulation of the
            facilities and amenities.
        (b)  Exceptions.--If a planned community composed of not more
     than 12 units is not a flexible planned community and no power
     is received to a declarant to make the planned community part of
     a larger planned community, a group of planned communities or
     other real estate, a public offering statement may, but need
     not, include the information otherwise required by subsection
     (a)(4) and (5) and the narrative descriptions of documents
     required by subsection (a)(6).
        (c)  Amendment for material change in information.--A
     declarant shall promptly amend the public offering statement to
     report any material change in the information required by this
     section.
     (Nov. 30, 2004, P.L.1486, No.189, eff. 60 days)

        2004 Amendment.  Act 189 amended subsec. (a)(13)(i) and (iv).
        Cross References.  Section 5402 is referred to in sections
     5102, 5320, 5401, 5403, 5404, 5407, 5410, 5414 of this title.