Michigan Compiled Laws — CONTINUING CARE COMMUNITY DISCLOSURE ACT (Act 448 of 2014)

Short title.

This act shall be known and may be cited as the "continuing care community disclosure act".

Definitions; A to C.

As used in this act: (a) "Administrator" means a person that performs administrative or operational functions within or in connection with the continuing care community. (b) "Advertisement or marketing communication" means any disclosure statement, prospectus, pamphlet, circular, form letter, written or electronic adve…

Definitions; D to L.

As used in this act: (a) "Department" means the department of licensing and regulatory affairs. (b) "Disclosure statement" means a disclosure statement as required under section 19(1)(c) or that may be required by the department under section 25, as applicable. (c) "Entrance fee" means money paid in a lump sum or insta…

Definitions; M to O.

As used in this act: (a) "Member" means an individual who enters into a continuing care agreement with a continuing care community. (b) "Monthly service fee" means a monthly charge to a member for continuing care and not as rent, or a daily prorated portion thereof. (c) "Nonrefundable portion of the entrance fee" means…

Definitions; P to R.

As used in this act: (a) "Person" means an individual, partnership, corporation, association, governmental entity, or other legal entity. (b) "Publish" means to publicly issue or circulate by newspaper, mail, radio, television, or electronic means or otherwise to disseminate to the public. (c) "Refundable portion of an…

Definitions; S.

As used in this act: (a) "Sale of a continuing care agreement" means the execution of a continuing care agreement. (b) "Sell a continuing care agreement" means to secure the sale of a continuing care agreement.

Continuing care community; organization and operation; purpose; member to service in advisory capacity.

(1) A continuing care community shall be organized and operated as either a for-profit or nonprofit entity. The entity's purposes shall be limited to ownership, organization, and operation of the continuing care community. (2) Each continuing care community shall elect or appoint at least 1 member, along with an altern…

Continuing care agreement; registration or exemption required; applicability to written or oral arrangements; offer or sale; conditions; circumstances.

(1) Subject to subsections (3) and (4), a person shall not offer to enter into or enter into a continuing care agreement unless the person is registered or exempt from registration under this act. (2) Subject to subsections (3) and (4), this act applies to all written or oral arrangements between a continuing care comm…

Rules; exemption; variance; area not considered home for the aged or adult foster care facility; relationship not subject to laws between landlord and tenant.

(1) A continuing care community that is licensed in whole or part under article 17 of the public health code, 1978 PA 368, MCL 333.20101 to 333.22260, or the adult foster care facility licensing act, 1979 PA 218, MCL 400.701 to 400.737, is exempt from any rules promulgated under article 17 of the public health code, 19…

(1) A person seeking initial registration under this act shall submit the following information to the department: (a) An initial registration application on a form prescribed by the department, signed and verified by an individual authorized to act on behalf of the continuing care community. (b) The organizing documen…

Incomplete application; notification; order approving or denying registration.

(1) Effective 60 days after the department receives a registration application, the application shall be considered to be complete unless the department proceeds as provided in subsection (2). (2) If, before the expiration of the 60-day period under subsection (1), the department notifies the applicant that the applica…

Effect of order approving or filing registration.

(1) The fact that an application for registration has been filed or approved does not constitute any of the following: (a) Approval of or a finding regarding the accuracy of any information in or accompanying the registration application. (b) A recommendation, approval, or other finding by the department concerning the…

Renewal of registration; application form to be sent by department.

(1) Except as otherwise provided in this act, the department shall renew the registration of a registrant that does all of the following: (a) On or before the expiration date printed on the registration, submits to the department an application for renewal of registration on a form provided by the department and accomp…

Application for registration renewal; processing; failure to submit application or fee; continuation of current registration; failure to file renewal application.

(1) Subject to subsections (2) and (3), an application for renewal of registration shall be processed in the same manner as an initial registration application under section 21. (2) If, within 60 days after receiving notice from the department under section 21(2), an applicant fails to submit to the department the spec…

Extension of registration; requirements; fees.

(1) The department may extend the term of an existing registration for a continuing care community for not more than 3 fiscal years if the department determines that all of the following requirements are met: (a) The continuing care community was registered under this act during the immediately preceding 5 fiscal years…

Fees; continuing care administration fund; creation; disposition; investment; money remaining at close of fiscal year; expenditures.

(1) The fee for filing an application for initial registration of the offer or sale of continuing care agreements or continuing care at home agreements is $250.00. If an application for registration is withdrawn before the effective date of registration or a stop order is issued before that date, the department shall r…

Reportable changes; amendment of registration.

(1) A registrant shall notify the department promptly in writing within 45 days of any reportable change with respect to the continuing care community measured semiannually. (2) A registrant shall submit to the department an application to amend a registration to address reportable changes. The disclosure statement and…

Delivery of continuing care agreements, emergency plan, and disclosure statement; availability of feasibility study.

(1) A continuing care community shall deliver to a prospective member all continuing care agreements pertinent to the continuing care sought by the prospective member, the continuing care community emergency plan in case of power outage, and the disclosure statement most recently approved by the department. The deliver…

Disclosure statement.

(1) Subject to subsection (3), a disclosure statement shall include at a minimum the following information, unless waived by the department in the reasonable exercise of discretion: (a) The name and address of the continuing care community and its affiliated parent or subsidiary business entity or partnership. (b) The…

Continuing care agreement; requirements.

A continuing care agreement shall meet all of the following requirements: (a) Specify in reasonable detail the rights, privileges, liabilities, and obligations of each party to the continuing care agreement with respect to the statements included in the disclosure statement under section 37(1)(h) to (cc). (b) Specify w…

Financial statements; requirements.

(1) Financial statements under section 19, 25, or 29 shall meet all of the following requirements: (a) Be submitted with a statement of any adverse material changes in the financial condition of the entity from the date of the financial statement. (b) Subject to subdivision (c), be of form and content required by the d…

Financial forecast.

A pro forma financial plan shall include a financial forecast for a period of 3 years, presented on the same accounting basis as the financial statements, including all of the following: (a) A balance sheet. (b) A statement of changes and activities or statement of operations. (c) A statement of cash flow. (d) Expected…

Funds to be held in trust account; deposit with escrow agent; conditions; temporary suspension order; return of escrowed funds; escrow agreement and account; requirements; release of funds.

(1) If a member pays funds to a continuing care community before occupancy, the funds shall be held in a trust account unless this requirement is waived or modified by the department. Any interest or other income from the investment of the funds held in the trust account shall accrue to the benefit of the member. The d…

Alternative financial arrangement.

(1) In lieu of an escrow arrangement imposed pursuant to section 45(2), the department may approve an alternative financial arrangement that separates or secures a designated amount of funds of the continuing care community for the benefit of members of the continuing care community or provides for the payment of funds…

Records; reports.

(1) A registered continuing care community shall prepare and maintain for not less than 6 years all of the following records: (a) Accounts and records of each day's sales of memberships in the continuing care community, receipts of cash, and other debits and credits. (b) Copies of contracts, including continuing care a…