§ 8008 — Escrow of entrance fees

(a) In the event the facility is not in operation at the time entrance fees are paid, the entrance fees or portions thereof shall be deposited in an escrow account. Such escrowed fees shall not be released to the provider until the following conditions are satisfied:
(1) Commitments are received from persons who have entered into continuing care contracts for a minimum of 60 percent of the residential units. As used in this subdivision, “commitment” means payment of at least 10 percent of the entrance fee.
(2) One hundred percent of the financing for construction and operation of the facility has been arranged. As used in this subdivision, “financing” includes all funds that, when combined with entrance fees and periodic fees receivable under signed contracts, are sufficient to complete construction of the facility and to provide enough working capital to enable the facility to operate in a self-sufficient manner.
(3) The provider has obtained or caused to be obtained a guaranteed maximum price contract for construction of the facility.
(4) The provider has obtained or caused to be obtained all permits and regulatory approvals necessary for operation of the facility except those dependent upon completion of construction.
(b) In the case of a contract for a previously occupied residential unit, fees shall be held in escrow until 60 days prior to the occupancy date.
(c) If the provider is unable to satisfy the conditions set forth in subsection (a) of this section within a reasonable period of time, the Commissioner may order that escrowed fees be released and refunded. (Added 1987, No. 247 (Adj. Sess.), § 1.)