SB 105 — Continuing Care Retirement Communities Act.-AB

Page 18 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 2.

DRS15043-NE-15Senate Bill 105-First Edition Page 19 General Assembly Of North Carolina Session 2025 (2) None of the grounds for denial listed in G.S.

Demonstrates that the expansion is financiallyfinanciallyviable viable and will not have an unreasonably adverse effect on the financial abilityabilityof of the applicant to furnish continuing care.

(4) The applicant demonstrates the abilityabilityto to provide continuing care and meet all financial and contractual obligations related to its operations, including the financial requirements of this Article.

(6) The actuarial study, if applicable, projects that the continuing care retirement communitycommunitywill will be in satisfactorysatisfactoryactuarial actuarial balance within a reasonable period of time once stabilized occupancy of the expansion is achieved, or if no actuarial study is required, the actuarial projection of future population flows demonstrates a sufficient number of adult care home beds and nursing beds to meet the needs of residents and the contractual obligations of the applicant.

(e) AftertheCommissionerapprovestheexpansionAftertheCommissionerapprovestheexpansionapplication,theprovidershallsubmit application,theprovidershallsubmit periodic sales and development reports to the Commissioner in a form prescribed by the Commissioner to monitor the expansion project.

Allentrancefees anddepositscollectedforindependentlivingunitsinanexpansionrequiringanddepositscollectedforindependentlivingunitsin anexpansionrequiring Commissioner approval under this Part shall be placed in an escrow account in accordance with Part 4 of this Article unless otherwise exempted by the Commissioner.

Page 20 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (1) A provision requiring that all funds received shall be placed into the escrow account in accordance with G.S.

(b) AnyAnydeposit depositdeliveryto delivery to an escrow agent pursuant to this Article shall be accompanied with a copy of the executed nonbinding reservation agreement, binding reservation agreement, or continuing care contract, a copycopyof of the receipt given to the depositor, a summarysummaryof of all deposits made on that date, and any other materials required by the escrow agent.

DRS15043-NE-15Senate Bill 105-First Edition Page 21 General Assembly Of North Carolina Session 2025 "§ 58-64A-125.

Anyindependent livinglivingunit unit forwhicharefundis pendingpendingshall shall not becounted toward the fifty percent (50%) requirement.

Page 22 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (3) For a proposed continuing care retirement community, the aggregate entrance fees received or receivable by the provider pursuant to binding reservation agreements and continuingcontinuingcare care contracts, plus theanticipatedtheanticipatedproceeds proceeds of any first mortgage loan or other long-term financing commitment, plus any equity being contributed by the provider or a related party, are equal to not less than ninety percent (90%) of the following amount:

(1) The provider has presold at least seventy percent (70%) of the proposed independent living units, having received a minimum ten percent (10%) deposit of each applicable entrance fee and maintains at least seventy-five percent (75%) of each entrance fee or deposit received in escrow, or has maintainedanindependentlivingunitoccupancymaintainedanindependentlivingunitoccupancyminimumofseventypercent minimumofseventypercent (70%) for at least 60 days.

(3) Theindependent livinglivingunits unitsareavailableforoccupancybythenewresidents. areavailablefor occupancybythenewresidents.

(c) The Commissioner shall instruct the escrow agent in writing to release to the provider entrance fees and deposits in the escrow account onlyonlywhen when the Commissioner has confirmed the information provided by the provider pursuant to subsection (a) or subsection (b) of this section.

DRS15043-NE-15Senate Bill 105-First Edition Page 23 General Assembly Of North Carolina Session 2025 (2) Average daily cash operating expenses.

(8) OperatingOperatingratio. ratio.

The quotient shall be calculated bybydividing dividing unrestricted cash and investments bybytotal total long-term debt, less the current portion of long-term debt.

(a) A provider shall prepare a disclosure statement for each continuing care retirement communitycommunityoperated operated or to be operated in this State that includes all of the following information:

Page 24 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (1) The name, business address, and telephone number of the provider and a statement of whether the provider is a partnership, corporation, or other type of legal entity.

(6) Thename,business address,education,workexperience,andlengthofservice with the provider or the provider's controlling person of (i) all officers, directors, trustees, managers, managing or general partners of the provider and, if applicable, the provider's controlling person, and any person having a ten percent (10%) or greater equity or beneficial interest in the provider or the provider's controlling person and (ii) any person who will be managing the continuingcareretirementcommunityonaday-to-daybasis,andadescriptioncontinuingcareretirementcommunityonaday-to-daybasis, andadescription of the person's interest in or occupation with the provider or controlling person.

A description of any matter in which the person (i) has been convicted of any felony or pleaded nolo contendere to a felony charge, (ii) has been held liable or enjoined in a civil action by final judgment involving fraud, embezzlement, fraudulent conversion, or DRS15043-NE-15Senate Bill 105-First Edition Page 25 General Assembly Of North Carolina Session 2025 misappropriation of property, or (iii) is subject to a currently effective injunctive or restrictive court order, or within the past five years, had any state or federal license or permit suspended or revoked as a result of an action brought by a governmental agency or department.

(10) A statement indicating whether the provider has a relationship with any religious, charitable,orotherorganizationorperson,alongcharitable,orotherorganizationorperson,alongwith with thenatureand extent of that relationship.

(14) A statement indicating whether the provider currentlycurrentlyemploys employs or will employ a third-partythird-partymanager manager for the continuing care retirement communitycommunityand, and, if so, the name of the third-party manager employed and their experience in providing management services within the continuing care retirement community industry.

Page 26 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (19) If the provider is licensed to provide continuing care at home, a description of the continuing care at home program, including the primary market area served.

(21) The 12-month daily average occupancy rate at the continuing care retirement community, bybyliving living unit type, as of the provider's fiscal year-end for the past five years or for each year of the continuing care retirement community's operation if it has been in operation for less than five years.

(25) A description of all nonancillarynonancillaryfees fees required of residents, including entrance fees, periodic fees, transfer fees, and resale fees, if any.

If the continuing care retirement communitycommunityis is not yet in operation, the provider shall include a table showing the expected frequency, average percent increase, and average dollar amount of each increase in periodic fees utilized in the five-year prospective financial statements required pursuant to subdivision (37) of this subsection.

If the continuing care retirement communitycommunityis isSenate DRS15043-NE-15Bill 105-First Edition Page 27 General Assembly Of North Carolina Session 2025 not yet in operation, the provider shall include a table showing the expected frequency, average percent increase, and average dollar amount of each increase in entrance fees utilized in the five-year prospective financial statements required pursuant to subdivision (37) of this subsection.

Will be due to residents who have permanently vacated their independent living unit and now reside in a non-independent living unit provided bybythe the provider whose former independent living unit has already been resold.

(29) The conditions under which a living unit occupied by a resident may be made available bybythe the provider to a different or new resident other than on the death of the prior resident.

58-64A-245, to provide reserve funding or securitysecurityto to enable the provider to refund entrance fees and deposits when due and to fulfill all of its other obligations under binding reservation agreements, continuing care contracts, and continuing care at home contracts, Page 28 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 including the establishment of escrow accounts, trusts, or reserve funds, together with the manner in which these funds will be invested, and the names and experience of any person or persons who will make the investment decisions.

Details of anyanyleasing leasing agreements where the provider is leasing from another person any part of the real property of the continuing care retirement community, including the length of the lease and the remaining term.

DRS15043-NE-15Senate Bill 105-First Edition Page 29 General Assembly Of North Carolina Session 2025 3.

(38) A narrative describing the reasons for anyanymaterial material differences between (i) the five-year prospective financial statements included as a part of the disclosure statement recorded most immediately subsequent to the start of the provider's most recently completed fiscal year and (ii) the actual results of operations of the provider's most recently completed fiscal year.

(39) A table detailing the following key financial metrics for the past three fiscal years, including the most recent fiscal year, or for each year the provider has beeninoperationiftheproviderhasbeeninoperationforlessthanthreeyears,beeninoperationiftheproviderhasbeeninoperationforlessthanthree years, plus the next three fiscal years, based on the provider's current and prior annual audited financial statements andcurrent five-yearprospectivefinancial statements.

(40) If the provider has had an actuarial studystudyprepared prepared within the prior three years, a statement of actuarial opinion which includes a description of the key Page 30 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 assumptions used to prepare the actuarial study and an opinion on satisfactory actuarial balance.

(41) A summarysummaryof of the last examination report issued bybythe the Commissioner, if any, with references to the page numbers of the examination report noting any deficiencies foundbythe Commissioner,andtheactions takenbytheprovider to rectify those deficiencies, indicating in the summary where the full examination report may be inspected at the continuing care retirement community.

(4) That the disclosure statement has not been reviewed or approved by any government agencyorrepresentativeto ensure accuracyaccuracyoftheinformationset oftheinformationset out.

DRS15043-NE-15Senate Bill 105-First Edition Page 31 General Assembly Of North Carolina Session 2025 (a) A provider shall deliver a current disclosure statement meeting the requirements of G.S.

(a) A provider may revise its disclosure statement at any time if, in the opinion of the provider, revision is necessary to prevent an otherwise current disclosure statement from containing amaterial misstatement offact oromittingoromittingamaterialfact amaterialrequiredto factbestated requiredtherein. to bestatedtherein.

Page 32 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 "Part 6.

(3) A provision that, if an agreement is rescinded, automatically canceled, or otherwise canceled bybythe the depositor, the depositor shall receive a refund of all money or other consideration transferred to the provider.

(ii) those nonstandard costs specifically incurred by the provider at the request of the resident and described in the contract or any contract DRS15043-NE-15Senate Bill 105-First Edition Page 33 General Assembly Of North Carolina Session 2025 amendment signed by the resident;

(2) AdraftamendeddisclosurestatementcontainingAdraftamendeddisclosurestatementcontaininga adescriptionofthedescriptionoftheproposed proposed continuing care at home program, including the primary market area to be served, the types of services to be provided, and the fees to be charged.

Page 34 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (4) An actuarial study prepared in accordance with accepted actuarial standards of practice which estimates when the continuing care at home program is projected to be in satisfactory actuarial balance.

Providers who do not collect entrance fees or some other type of up-front prepayment of costs are exempt from this requirement and shall only be required to submit an actuarial projection of future population flows and adult care home bed and nursingnursingbed bed needs using appropriate mortality, morbidity, withdrawal, occupancy, and other demographic assumptions, and using a projection period that extends to a point at which, in the actuary's professional judgment, the use of a longer period would not materially affect the results and conclusions.

(5) A market studystudyprepared preparedbya by a person experienced in the preparation of market studies for continuing care at home or similar programs that demonstrates sufficient interest in a continuing care at home program.

DRS15043-NE-15Senate Bill 105-First Edition Page 35 General Assembly Of North Carolina Session 2025 (2) A provision that, if a resident dies prior to the effective start date of services, orif,on account ofillness,injury,orincapacity,a resident wouldbeprecluded from meeting the eligibilityeligibilityterms terms of the contract, the contract is automatically canceled.

Page 36 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 "§ 58-64A-195.

(a) All providers shall have an annual audit bybyan an independent certified public accountant and shall file audited financial statements with the Commissioner within 150 days following the end of each fiscal year.

(b) Extensions of the filing date may be granted by the Commissioner for 30-day periods upon a showing bybythe the provider and its independent certified public accountant of the reasons for requesting an extension and determination by the Commissioner of good cause for an extension.

(a) The annual audited financial statements shall report the financial position of the provider as of the end of the most recent fiscal year and the results of its operations, cash flows, and changes in equityequityor or net assets for the year then ended.

The audited financial statements shall be comparative, presenting the amounts as of the end of the most current year-end and the amounts as of the immediatelyimmediatelypreceding preceding year-end.

(3) If a provider is part of an obligated group, the audited financial statements shall be either consolidated or combined with the other members of the obligated group and shall include a combining or consolidating balance sheet, acombiningorconsolidatingstatementofoperationsandchangesinnetacombiningorconsolidatingstatementofoperationsandchanges innet assets or equity, and a combining or consolidating statement of cash flows as DRS15043-NE-15Senate Bill 105-First Edition Page 37 General Assembly Of North Carolina Session 2025 supplemental information to the audited combined or consolidated financial statements.

Page 38 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (c) The Commissioner may request the information required in this section more frequently to assist in the determination of a possible hazardous condition.

If the Commissioner determines that additional information is needed to properlyproperlymonitor monitor the financial condition or operations of a provider or continuing care retirement community or is otherwise needed to protect the interests of residents and the general public, the Commissioner may require a provider licensed under this Article to file any of the following:

A provider shall notifynotifythe the Commissioner and all residents in writing within 10 business days whenever any of the following apply:

DRS15043-NE-15Senate Bill 105-First Edition Page 39 General Assembly Of North Carolina Session 2025 (4) The provider plans to reduce the number of any type of living unit by twenty percent (20%) or more.

(6) Any proceeding for denial, suspension, or revocation of any license or permit needed to operate all or part of a continuing care retirement communitycommunityin in this State.

(b) A provider or any other person who owns the real property used in the operations of a continuing care retirement community shall obtain approval from the Commissioner before consummating any sale or transfer of any real property used in the operations of a continuing care retirement community, including a sale-leaseback transaction, or anyanyinterest interest in a continuing care retirement community, other than the sale of an independent living unit to a resident or other transferee.

Page 40 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (2) A description of the transaction and the terms of the transaction.

If the person is not an individual, a report of the nature of its business operations duringthe past fiveyearsorforfive yearsorfor alesser periodas the person and any predecessors have been in existence.

(3) Fully audited financial information as to the earnings and financial condition of each acquiring person for the preceding five fiscal years, or for a lesser period as the acquiring person and any predecessors have been in existence, DRS15043-NE-15Senate Bill 105-First Edition Page 41 General Assembly Of North Carolina Session 2025 and similar unaudited information as of a date not earlier than 90 days prior to the filing of the written notice.

(7) A description of anyanyagreements agreements made or to be made with residents which will amend any continuing care or continuing care at home contract at the time of the transfer of control.

(3) Afterthe change ofcontrol, theproviderwill bebeableto abletosatisfythe satisfythecertificationcertification or licensure requirements, as applicable, of this Article.

(5) AnyAnyplans plans or proposals that anyanyacquiringperson acquiring person has to liquidate the provider, or any continuing care retirement community operated by the provider in this State, sell its assets or consolidate or merge it with anyanyperson, person, or to make any other material change in its business or corporate structure or management, are fair and reasonable to residents and in the public interest.

Page 42 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (b) Theprovidershall inform all residents in writingwritingofthe oftherequestrequest forapproval submitted to the Commissioner pursuant to this section within 10 business days after the request for approval is submitted to the Commissioner.

(2) The proposed third-party manager is affiliated directly or indirectly through ownership, control, or business relations with any person or persons whose business operations are or have been marked by manipulation of assets or accounts or bybybad bad faith, to the detriment of residents, members, stockholders, investors, creditors, or the public.

(2) That a manager is now, or was in the past, affiliated directly or indirectly through ownership interest of ten percent (10%) or more in, or control of, any business, corporation, or other entity that has been convicted of any felony or pleaded nolo contendere to a felonyfelonycharge charge or has been held liable or enjoined in a civil action by final judgment involving fraud, embezzlement, fraudulent conversion, or misappropriation of property.

(a) A provider shall maintain after the opening of a continuing care retirement community an operating reserve equal to fifty percent (50%) of the total operating costs of the continuing care retirement communitycommunityforecasted forecasted or projected for the 12-month period following the period covered by the most recent disclosure statement filed with the Department.

(b) Once a continuing care retirement community achieves a 12-month daily average independent living unit occupancy rate of ninety percent (90%) or higher, a provider shall only berequired to maintain an operatingreservein anamount calculatedusingcalculatedusingthetablebelow,unless thetablebelow,unless otherwise instructed by the Commissioner:

12-Month Daily Average Operating Reserve Requirement as a Percentage Independent Living Unit of Total Operating Costs of the Continuing Care Occupancy Rate Retirement Community 90% or above.....................................................................................................................above.....................................................................................................................25.00% 86% to 89.9%....................................................................................................................31.25% 83% to 85.9%....................................................................................................................37.50% 80% to 82.9%....................................................................................................................43.75% Below 80%........................................................................................................................50.00% (c) A provider who has a 12-month daily average independent living unit occupancy rate equal to or in excess of ninety-three percent (93%) and has no long-term debt or a debt service coverage ratio in excess of 2.00 as of the provider's most recent fiscal year-end shall only be required to maintain an operating reserve equal to twelve and one-half percent (12.5%) of total operating costs of the continuing care retirement community, unless otherwise instructed by the Commissioner.

25.00%Senate 86%Bill 105-First Edition Page 43 General Assembly Of North Carolina Session 2025 (d) The Commissioner may increase the amount a provider is required to 89.9%....................................................................................................................maintain as its operating reserve, not to exceed fifty percent (50%) of total operating costs as calculated in accordance with G.S.

31.25% 83% to 85.9%....................................................................................................................

37.50% 80% to 82.9%....................................................................................................................

43.75% Below 80%........................................................................................................................

50.00% (c) A provider who has a 12-month daily average independent living unit occupancy rate equal to or in excess of ninety-three percent (93%) and has no long-term debt or a debt service coverage ratio in excess of 2.00 as of the provider's most recent fiscal year-end shall only be required to maintain an operating reserve equal to twelve and one-half percent (12.5%) of total operating costs of the continuing care retirement community, unless otherwise instructed by the Commissioner.

DRS15043-NE-15 Page 43 General Assembly Of North Carolina Session 2025 (d) The Commissioner may increase the amount a provider is required to maintain as its operating reserve, not to exceed fifty percent (50%) of total operating costs as calculated in accordance with G.S.

(e) A provider shall notify all residents in writing within 10 business days if the Commissioner, pursuant to subsection (d) of this section, increases the amount a provider is required to maintain as its operatingoperatingreserve reserve for a continuing care retirement communitycommunityoperated operated by the provider or requires the operating reserve to be placed on deposit with the Commissioner.

If the debt service portion is accounted forbyforbywayofanotherreserveaccount, way ofanotherreserveaccount, thedebt serviceportion maybeexcludeduponmaybeexcludeduponsatisfactory satisfactory evidence of the existence and purpose of the other reserve account.

Page 44 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 "§ 58-64A-255.

(a) Aprovidershall fundits operatingreservewith anyofthefollowinganyofthefollowingqualifyingassets: qualifyingassets:

(b) Except as otherwise provided in this subsection, the assets maintained bybythe the provider as an operating reserve for a continuing care retirement community operated by the provider underthis Articleshall not besubject to anyliens, charges, judgments, garnishments, orcreditors' claims and shall not be hypothecated, pledged as collateral, or otherwise encumbered in any manner.

A provider maymayencumber encumber assets held as an operatingoperatingreserve reserve as part of a securitysecuritypledge pledge of assets or similar collateralization that is part of the provider's debt financing and is included in the provider's debt indenture security instruments related thereto or other similar instrument.

(1) The surety bond maymaybe be exchanged or replaced with another surety bond if (i) the surety bond applies to obligations and liabilities that arose during the period of the original surety bond, (ii) the surety bond meets the requirements of this section, and (iii) 90 days' advance written notice is provided to the Commissioner.

DRS15043-NE-15Senate Bill 105-First Edition Page 45 General Assembly Of North Carolina Session 2025 (3) A suretysuretybond bondmaybe may be canceled bybythe the issuer of the bond with respect to future obligations or liabilities upon proper notice pursuant to this section and without regard to approval or acceptance of the Commissioner.

As used is this Part, "impaired" means a weakened financial state or condition that maymayaffect affect a provider's ability to pay its obligations as they come due in the normal course of business.

Page 46 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (a) The Commissioner may (i) deny an application or any other request for approval or (ii) restrict or revoke any permit, certificate, license, or other authorization issued under this Article if the Commissioner finds that the applicant or provider did any of the following:

(12) Failed to maintain the operatingoperatingreserve reserve required under this Article or released a portion of the operating reserve required to be maintained under this Article without Commissioner approval.

DRS15043-NE-15Senate Bill 105-First Edition Page 47 General Assembly Of North Carolina Session 2025 (d) If the Commissioner issues a cease and desist order or restricts or revokes a provider's permit, certificate, or license, the provider shall notify all residents and depositors of the cease and desist order, restriction, or revocation within five business days.

(h) A provider who has their permanent license revoked shall continue to maintain an operating reserve and to file its annual audited financial statements, annual disclosure statement, andpayandpayannualfeestotheCommissionerasrequiredunderthisArticleasifthepermanentlicense annualfeestotheCommissionerasrequiredunderthisArticleasifthepermanentlicense had continued in full force, but the provider shall not issue anyanynew new continuing care or continuing care at home contracts.

(10) Whether the management of a provider, including officers, directors, or any other person who directly or indirectlyindirectlycontrols controls the operations of an applicant, provider, or continuing care retirement community, fails to possess and demonstrate the competence, experience, or integrity considered by the Commissioner to be necessary to serve the provider or continuing care retirement community in that position.

(11) Whether the management of a provider has failed to respond to the Commissioner's inquiries about the condition of the applicant or provider or Page 48 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 has furnished false and misleading information in response to an inquiry by the Commissioner.

(b) Within 45 days after the submittal of a corrective action plan, the Commissioner shall notifynotifythe the provider whether the corrective action plan shall be implemented or is, in the judgment of the Commissioner, unsatisfactory.

If the Commissioner determines the corrective action plan is unsatisfactory, the notification to the provider shall set forth the reasons for the determination and maymayset set forth proposed revisions that will render the corrective action plan satisfactorysatisfactoryin in the judgment oftheCommissioner.

58-64A-155 DRS15043-NE-15Senate Bill 105-First Edition Page 49 General Assembly Of North Carolina Session 2025 shall apply to the corrective action plan and the most recent report to the Commissioner required to be distributed pursuant to this subsection.

(a) TheCommissionermaymakepublicorprivateinvestigations withinoroutsideofthiswithin oroutsideofthis State as necessary to (i) determine whether any person has violated or is about to violate any provision of this Article, (ii) aid in the enforcement of this Article, or (iii) verify statements contained in any disclosure statement or other filing filed or delivered under this Article.

Page 50 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (a) A permit, certificate, license, or other approval issued by the Commissioner pursuant to this Article shall be forfeited, after notice and opportunity for hearing, when any one of the following occurs:

(c) No resident or depositor shall have the benefit of this section who, within 30 days of receipt, has refused or failed to accept an offer made in writing by the provider to rescind the binding reservation agreement, continuing care contract, or continuing care at home contract in question and to refund the full amount paid by the resident or depositor with interest at the rate established monthlymonthlybythe by the Commissioner of Banks pursuant to G.S.

DRS15043-NE-15Senate Bill 105-First Edition Page 51 General Assembly Of North Carolina Session 2025 Regardless of whether delinquency proceedings as to a provider have been or are to be initiated, a provider maymaynot notactivelysolicit, actively solicit, approve the solicitation of, or enter into new binding reservation agreements, continuing care contracts, or continuing care at home contracts in this State after the provider knew, or reasonably should have known, that the provider was impaired or insolvent except with the written permission of the Commissioner.

(2) A provider has been or will be unable to fullyfullyperform perform its obligations pursuant to continuing care and continuing care at home contracts, or to meet prospective financial data previously filed by the provider.

(d) If, at any time, the Court finds, upon petition of the Commissioner, a provider, or on its own motion, that the objectives of an order to rehabilitate a provider have been accomplished and that the continuing care retirement community or communities owned by, or operated by, the provider can be returned to the provider's management without further jeopardy to the residents or depositors of the continuing care retirement community or communities, the Court may, upon a full report and accounting of the conduct of the provider's affairs during the rehabilitation and of the provider's current financial condition, terminate the rehabilitation and, bybyorder, order, return thecontinuingthecontinuingcareretirementcommunityorcommunities careretirementcommunityorcommunitiesownedby,orowned by,or operated by, the provider, along with the assets and affairs of the provider, to the provider's management.

(f) An order for rehabilitation shall be refused or vacated if the provider posts a bond, by a recognized surety authorized to do business in this State and executed in favor of the Commissioner on behalf of persons who may be found entitled to a refund of entrance fees and deposits from the provider or other damages in the event the provider is unable to fulfill its Page 52 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 contracts to provide continuing care, in an amount determined by the Court to be equal to the reserve funding that would otherwise need to be available to fulfill the provider's obligations.

DRS15043-NE-15Senate Bill 105-First Edition Page 53 General Assembly Of North Carolina Session 2025 (d) Whenever a state of emergency or disaster has been proclaimed in this State or for an area within this State under G.S.

(e) If a semiannual meeting is held under subsection (d) of this section, notice of the method residents maymayuse use to attend the meetingmeetingshall shall be published with the notice of the meeting.

No act, agreement, or statement of any resident, or of an individual purchasing continuing care for a resident under any continuing care or continuing care at home contract shall constitute avalid waiverofanywaiverofanyprovision provision ofthis Articleintended forthebenefit or protectionoftheresident or the individual purchasing continuing care for the resident.

(4) Report to the Commissioner on developments in the continuing care retirement communityindustry,includingcommunityindustry,includingcontinuing continuing careat homeand similar programs, and problems or concerns of providers and residents.

Page 54 DRS15043-NE-15Senate Bill 105-First Edition General Assembly Of North Carolina Session 2025 (a) Nothing in this Article affects the authority of the Department of Health and Human Services or any successor agency otherwise provided by law to license or regulate anyanylong-term long-term care facility.

(b) ContinuingContinuingcareretirement careretirementcommunitiesand communitiesandproviderslicensedproviderslicensed underthis Articlethat are also subject to the provisions of the North Carolina Condominium Act under Chapter 47C of the General Statutes shall not be subject to the provisions of Chapter 39A of the General Statutes, provided that the continuing care retirement community's declaration of condominium does not require the payment of any fee or charge not otherwise provided for in a resident's continuing care contract, or other separate contract for the provisions of membership or services.

DRS15043-NE-15Senate Bill 105-First Edition Page 55