---
name: Entity Formation & Property Onboarding Expert
description: LLC setup, entity formation, property onboarding, new acquisition setup, bank account setup, EIN, registered agent, Corporate Transparency Act, beneficial ownership, 100-day plan, utility transfer, resident notification, operating agreement.
---

# Entity Formation & Property Onboarding Expert

Comprehensive reference for forming property-holding LLCs, onboarding newly acquired manufactured housing communities into Sunrise systems, and executing the 100-day post-acquisition integration playbook. Covers all 15 Sunrise portfolio states with state-specific filing requirements, fees, and compliance obligations.

**Scope:** LLC formation, EIN application, operating agreements, bank account setup, registered agent selection, insurance binding, RentManager configuration, utility transfers, resident notifications, annual compliance, and vendor contract essentials.

**Last verified:** March 2026. Legal and fee data should be revalidated quarterly against state Secretary of State websites and IRS guidance.

> **Workflow handoffs — Acquisition pipeline:** `mhp-acquisitions-expert` (deal analysis, DD, IC memo) → `entity-formation` (LLC setup, bank accounts, EIN) → `finance-operations-expert` (accounting setup, QBO entity) → `insurance-risk-expert` (coverage placement, COIs) → `mhp-operations-expert` (100-day operational integration)

---

## Table of Contents

1. [Sunrise Entity Structure](#sunrise-entity-structure)
2. [LLC Formation by State](#llc-formation-by-state)
3. [Corporate Transparency Act Compliance](#corporate-transparency-act-compliance)
4. [EIN Application](#ein-application)
5. [Operating Agreement Framework](#operating-agreement-framework)
6. [Bank Account Setup](#bank-account-setup)
7. [Registered Agent Selection](#registered-agent-selection)
8. [Insurance Binding](#insurance-binding)
9. [Property Management Agreement](#property-management-agreement)
10. [RentManager Property Setup](#rentmanager-property-setup)
11. [100-Day Post-Acquisition Playbook](#100-day-post-acquisition-playbook)
12. [Utility Transfer Procedures](#utility-transfer-procedures)
13. [Resident Notification Requirements](#resident-notification-requirements)
14. [Business Licenses & Permits](#business-licenses--permits)
15. [Vendor Contract Provisions](#vendor-contract-provisions)
16. [Annual Compliance Calendar](#annual-compliance-calendar)
17. [Document Retention Requirements](#document-retention-requirements)
18. [Decision Trees](#decision-trees)
19. [Common Gotchas](#common-gotchas)
20. [Output Formats](#output-formats)
21. [References](#references)

---

## Sunrise Entity Structure

### Naming Convention

**Standard Format:**
```
SCI [Property Name] MHP LLC
```

**Examples:**
- SCI Darby View MHP LLC
- SCI Rolling Meadows MHP LLC
- SCI Twin Lakes MHP LLC

**Variations:**
| Pattern | Use Case |
|---------|----------|
| `SCI [Name] MHP LLC` | Standard MHP property holding entity |
| `SCI [Name] Parking LLC` | Parking asset holding entity |
| `SCI [Name] Holdings LLC` | Portfolio or multi-asset holding entity |
| `Sunrise Capital Investors [Name] LLC` | Parent/fund-level entities |
| `SCI [Name] Manager LLC` | Property management entities (rare) |

### Entity Hierarchy

```
Sunrise Capital Investors LLC (Parent / GP)
  |
  +-- SCI Management LLC (Management Company)
  |     |-- Property Management Agreements with each property LLC
  |     |-- Employs on-site staff (where applicable)
  |     |-- Provides centralized services (accounting, maintenance, compliance)
  |
  +-- SCI [Property A] MHP LLC (Single-Asset Entity)
  |     |-- Owns real property + improvements
  |     |-- Holds utility accounts, insurance, local licenses
  |     |-- Separate bank accounts (operating + security deposit)
  |
  +-- SCI [Property B] MHP LLC (Single-Asset Entity)
  |     |-- (Same structure)
  |
  +-- [Fund Entity] (Capital raise vehicle, if applicable)
```

### Why Single-Asset Entities

- **Liability isolation:** Incident at Property A does not expose Property B assets
- **Lender requirement:** Most commercial lenders require Special Purpose Entity (SPE) structure
- **Clean disposition:** Sell the LLC (or its assets) without unwinding a multi-property entity
- **Tax flexibility:** Each entity can elect its own tax treatment (disregarded, partnership, S-corp)
- **Investor clarity:** Fund investors can see exactly which entity holds which asset

### Formation State Selection

**Sunrise default:** Form the LLC in the state where the property is physically located. This avoids paying both a domestic filing fee AND a foreign registration fee.

**When Delaware might make sense:** Only if (a) the deal involves complex multi-state investors requiring Delaware Chancery Court access, or (b) the fund-level entity needs Delaware's flexible LLC statute. For individual property LLCs, always form in the property state.

---

## LLC Formation by State

### 15-State Filing Matrix

*Last verified: March 2026. Fees change periodically; confirm with the relevant Secretary of State before filing.*

| State | Formation Fee | Foreign LLC Fee | Filing Agency | Online Filing | Expedited Available |
|-------|--------------|-----------------|---------------|---------------|---------------------|
| **OH** | $99 | $99 | OH Secretary of State | Yes | Yes |
| **IN** | $95 | $125 | IN Secretary of State | Yes (INBiz) | Yes |
| **MD** | $100 | $100 | MD SDAT | Yes (MBE) | Yes |
| **MI** | $50 | $50 | MI LARA | Yes | Yes |
| **FL** | $125 | $125 | FL Dept of State (Sunbiz) | Yes | No standard expedite |
| **WV** | $100 | $150 | WV Secretary of State | Yes | Yes |
| **PA** | $125 | $250 | PA Dept of State | Yes | Yes |
| **AL** | $200 | $150 | AL Secretary of State | Yes | Yes |
| **GA** | $110 | $235 | GA Secretary of State | Yes | Yes |
| **AR** | $45 | $270-$300 | AR Secretary of State | Yes | Yes |
| **MN** | $155 | $185-$205 | MN Secretary of State | Yes | Yes |
| **ND** | $135 | $135 | ND Secretary of State | Yes | Yes |
| **WI** | $130 | $100 | WI DFI | Yes | Yes |
| **MO** | $50 | $50 (online) / $105 (mail) | MO Secretary of State | Yes | Yes |
| **IL** | $150 | $150 | IL Secretary of State | Yes | Yes |

### Formation Filing Checklist (Per State)

For each new entity, complete the following:

1. **Check name availability** on the state's Secretary of State business search
2. **Prepare Articles of Organization** with:
   - LLC name (must include "LLC" or "Limited Liability Company")
   - Principal office address
   - Registered agent name and address (must be in-state)
   - Organizer name and signature
   - Management structure (member-managed vs. manager-managed)
   - Effective date (can be future-dated in most states)
   - Duration (perpetual is standard)
3. **File Articles** online (preferred for speed) or by mail
4. **Receive Certificate of Formation** (processing times vary: 1-5 business days online, 2-6 weeks by mail)
5. **Order certified copies** (2-3 copies recommended for banking and insurance)

### State-Specific Filing Notes

**Ohio (OH):**
- File with OH Secretary of State online via business portal
- No publication requirement
- No operating agreement filing required (keep on file internally)
- $99 flat fee, no annual report, no franchise tax for LLCs

**Indiana (IN):**
- File via INBiz portal (in.gov/sos)
- $95 base fee; online filing adds no surcharge
- Must designate at least one registered agent with IN street address
- Biennial report required ($32 online, $50 by mail)

**Maryland (MD):**
- File Articles of Organization with MD State Dept of Assessments and Taxation (SDAT)
- $100 filing fee
- Must also file Personal Property Return (annual, $300) — this is Maryland's annual report equivalent
- Maryland requires listing at least one authorized person in the Articles

**Michigan (MI):**
- Lowest formation fee in portfolio at $50
- File with MI Dept of Licensing and Regulatory Affairs (LARA)
- Annual report due February 15 ($25)
- Must include at least one member or manager name in the Articles

**Florida (FL):**
- File with FL Dept of State via Sunbiz.org
- $125 filing fee ($100 + $25 registered agent designation fee)
- Annual report due May 1 ($138.75) — steepest annual cost in portfolio
- Late fee: $400 additional if filed after May 1
- **Critical:** FL has the highest ongoing compliance cost; budget accordingly

**West Virginia (WV):**
- File with WV Secretary of State
- $100 formation fee
- Annual report due July 1 ($25)
- Must maintain registered agent with WV physical address

**Pennsylvania (PA):**
- File Certificate of Organization with PA Dept of State
- $125 filing fee
- **NEW (2025):** Annual report now required, due September 30 ($7)
- Previously only required decennial reports — this is a significant change
- Must include at least one organizer in the filing

**Alabama (AL):**
- File Articles of Organization with AL Secretary of State
- $200 filing fee — highest formation cost in portfolio
- Business Privilege Tax Return due within 2.5 months of formation, then annually by April 15
- Minimum privilege tax is $50/year
- No separate annual report; privilege tax filing serves that function

**Georgia (GA):**
- File Articles of Organization with GA Secretary of State online
- $110 filing fee
- Annual registration due April 1 ($60)
- Can file annual registration as early as January 1

**Arkansas (AR):**
- Lowest formation fee in portfolio at $45
- File with AR Secretary of State
- Annual Franchise Tax Report due May 1 ($150 + $5 online fee)
- Despite low formation cost, annual franchise tax is relatively high
- **Watch:** Total first-year cost ($45 + $155) actually exceeds some higher-formation-fee states

**Minnesota (MN):**
- File with MN Secretary of State
- $155 filing fee
- Annual report due December 31 ($0 — free for domestic LLCs)
- **Regulatory note:** 90-day rent increase notice required (see mhp-operations-expert skill); no admin/capital/distribution markup on utility billing

**North Dakota (ND):**
- File with ND Secretary of State
- $135 filing fee
- Annual report due November 15 ($50)

**Wisconsin (WI):**
- File with WI Dept of Financial Institutions (DFI)
- $130 filing fee
- Annual report due in anniversary quarter ($25)
- Quarter assignments: Q1 = Mar 31, Q2 = Jun 30, Q3 = Sep 30, Q4 = Dec 31

**Missouri (MO):**
- File with MO Secretary of State
- $50 filing fee (tied for lowest with MI)
- **No annual report required for LLCs** — zero ongoing state compliance cost
- Corporations do have annual reports; LLCs are exempt
- Most cost-effective state in the portfolio for ongoing compliance

**Illinois (IL):**
- File with IL Secretary of State
- $150 filing fee
- Annual report due by end of month prior to anniversary month ($75 + $1.69 transaction fee)
- Must file within 60 days of fiscal year end

---

## Corporate Transparency Act Compliance

*Last verified: March 2026. CTA requirements have changed significantly. Monitor FinCEN.gov for final rule updates.*

### Current Status (March 2026)

**MAJOR CHANGE:** On March 21, 2025, FinCEN issued an interim final rule that **exempts all U.S.-formed entities** (domestic reporting companies) from Beneficial Ownership Information (BOI) reporting under the Corporate Transparency Act.

**What this means for Sunrise:**
- All SCI property LLCs formed in U.S. states are **currently exempt** from BOI filing
- No BOI reports need to be filed with FinCEN for domestic entities
- Previously filed BOI reports do not need to be updated or corrected
- This exemption remains in force under the interim final rule while FinCEN conducts further rulemaking

### What Still Applies

| Requirement | Status | Notes |
|-------------|--------|-------|
| BOI for U.S.-formed entities | **Exempt** (interim final rule) | Monitor for final rule changes |
| BOI for foreign-formed entities registered in U.S. | **Required** | Confirm deadlines with counsel |
| New York LLC Transparency Act | **Active** (Jan 1, 2026) | Only applies to non-U.S. LLCs registered in NY |
| State-level transparency laws | **Varies** | Check each state; some states adopting their own requirements |

### Recommended Posture

Even though domestic BOI filing is currently suspended:

1. **Maintain internal records** of all beneficial owners for each entity (names, DOBs, addresses, SSNs/identification numbers)
2. **Document ownership chains** — who owns what percentage of each LLC
3. **Track changes** — member additions, removals, ownership percentage changes
4. **Monitor FinCEN** — the final rule could reinstate requirements or modify thresholds
5. **Budget for compliance** — if requirements return, you'll need to file within compressed timelines

### Beneficial Owner Information to Maintain (Internal)

For each entity, keep current records of every individual who:
- Exercises **substantial control** (officers, managers, senior decision-makers)
- Owns or controls **25% or more** of ownership interests

**Information to collect per person:**
- Full legal name
- Date of birth
- Current residential address (not business address)
- Unique identifying number from passport, driver's license, or state ID
- Image of the identifying document

---

## EIN Application

### Overview

Every new SCI property LLC needs its own Employer Identification Number (EIN) from the IRS. This is required before opening bank accounts, filing tax returns, or hiring employees.

### Application Methods

| Method | Form | Processing Time | Availability | Best For |
|--------|------|-----------------|--------------|----------|
| **Online** | IRS website | **Immediate** (minutes) | M-F 7am-10pm ET | All domestic entities — always use this |
| **Fax** | SS-4 | 4-7 business days | Anytime | Backup if online is down |
| **Mail** | SS-4 | 4-6 weeks | Anytime | Never use — too slow |
| **Phone** | SS-4 | Same day | M-F 7am-7pm ET | International applicants only |

### Online Application Process (Preferred)

1. Go to IRS.gov/EIN
2. Select "Apply Online Now"
3. Complete the application:
   - **Entity type:** LLC
   - **Number of members:** Enter actual member count
   - **State of organization:** Property state (where LLC was formed)
   - **Responsible party:** Must be an individual (not an entity) — typically the managing member or authorized officer
   - **Reason for applying:** Started a new business
   - **Principal activity:** Real estate rental and leasing
   - **Date started:** Date of LLC formation (or expected start date)
4. Submit and receive EIN immediately on screen
5. **Save/print the confirmation** — this is your EIN assignment letter (CP 575)
6. IRS mails official CP 575 notice within 4 weeks

### Important Restrictions & Gotchas

- **One EIN per responsible party per day.** If forming multiple entities, space applications across days or use different responsible parties.
- **Entity must be formed with the state BEFORE applying for EIN.** The IRS may reject or delay applications if the entity doesn't exist in state records yet.
- **Responsible party must have a valid SSN or ITIN.** Cannot use another EIN.
- **The online application session times out after 15 minutes of inactivity.** Have all information ready before starting.
- **EIN is permanent.** Once assigned, it's never reused or reassigned, even if the entity is dissolved.
- **Don't apply before you need it.** An unused EIN creates an IRS filing expectation. Apply only when you're ready to open bank accounts or file returns.

### After Receiving EIN

- [ ] Save CP 575 confirmation in entity's permanent records
- [ ] Provide EIN to attorney for operating agreement
- [ ] Provide EIN to bank for account opening
- [ ] Provide EIN to insurance broker for policy binding
- [ ] Provide EIN to CPA for tax setup (QBO entity creation)
- [ ] File IRS Form 8832 if electing non-default tax classification (rare for single-asset property LLCs)

---

## Operating Agreement Framework

### Why It Matters

The operating agreement is the governing document of the LLC. Even in states that don't legally require one, lenders universally require a signed operating agreement. For Sunrise's single-asset property entities, the operating agreement must satisfy both internal governance needs and lender SPE requirements.

### Essential Provisions

#### 1. Purpose and Powers (Narrow Scope)

```
The sole purpose of the Company is to acquire, own, hold, manage, lease,
operate, improve, and dispose of [Property Address], and to engage in all
activities incidental thereto.
```

**Why narrow:** Lenders require SPE language limiting the entity to a single purpose. A broad purpose clause jeopardizes bankruptcy remoteness.

#### 2. Member Information and Capital Contributions

- Full legal names and addresses of all members
- Initial capital contribution amounts and dates
- Percentage ownership interests
- Capital account maintenance rules
- Additional capital call provisions (timing, limits, dilution remedies)

#### 3. Management Structure

**Manager-managed** is standard for Sunrise entities:
- Manager (typically SCI Management LLC or a designated individual) handles day-to-day operations
- Members retain approval rights for major decisions (sale, refinance, new debt, dissolution)
- Manager compensation terms (management fee, reimbursement of expenses)

#### 4. Distribution Waterfall

Typical structure for value-add MHP acquisitions:
1. Return of capital contributions
2. Preferred return (typically 8-10% cumulative)
3. Catch-up to promote partner
4. Residual split (e.g., 70/30 or 80/20 LP/GP)

**Include:** Frequency (quarterly/monthly), reserve holdback authority, tax distribution provisions (quarterly estimated tax distributions)

#### 5. SPE / Bankruptcy Remote Provisions (Lender-Required)

These provisions are **mandatory** when financing is involved:

- **Separateness covenants:** Entity must maintain its own books, records, bank accounts, financial statements, stationery, and tax returns separate from all affiliates
- **No commingling:** Entity funds must never be commingled with any other entity's funds
- **No guarantees:** Entity cannot guarantee debt of any other person or entity (except as required by the loan)
- **Independent director/manager:** At least one independent manager whose consent is required for voluntary bankruptcy filing — this person must have no material relationship with the borrower or its affiliates
- **Springing member:** Upon the last remaining member ceasing to be a member (bankruptcy, dissolution), a springing member automatically becomes a member to prevent dissolution of the LLC
- **No dissolution:** Members cannot voluntarily dissolve the entity without independent director/manager consent
- **Solvency certification:** Periodic certification that the entity remains solvent
- **Arm's length transactions:** All transactions with affiliates must be at fair market value on arm's length terms
- **Adequate capitalization:** Entity must maintain sufficient capital for its operations

#### 6. Transfer Restrictions

- Right of first refusal for other members
- Prohibition on transfers that would violate securities laws
- Prohibition on transfers that would cause a default under loan documents
- Tag-along / drag-along rights (if multiple investors)
- Permitted transfers (to affiliates, family trusts, estate planning entities)

#### 7. Tax Provisions

- Tax Matters Partner / Partnership Representative designation
- Tax election authority (Section 754 election, etc.)
- Tax distribution provisions (minimum distributions to cover tax liability)
- Allocation of income, gain, loss, deduction per IRC Section 704(b)

#### 8. Books, Records, and Reporting

- Annual audited (or reviewed) financial statements
- Monthly/quarterly operating reports
- Right of inspection by members
- Record retention requirements
- K-1 delivery timeline (March 15 deadline for calendar-year entities)

#### 9. Indemnification and Exculpation

- Manager indemnified for good-faith actions within scope of authority
- Exculpation for negligence (but not fraud, willful misconduct, or bad faith)
- Advancement of expenses for defense of covered claims

#### 10. Dissolution and Winding Up

- Triggering events (member vote, judicial decree, etc.)
- Order of distribution upon liquidation (creditors first, then capital, then profits)
- Manager authority during winding up period

---

## Bank Account Setup

### Sunrise Banking Relationships

| Bank | Role | Geographic Coverage | Notes |
|------|------|---------------------|-------|
| **Truist** | Primary | Southeast, Mid-Atlantic | Largest relationship; preferred for new entities |
| **Flagstar** | Secondary | Midwest, Northeast | Good for MI, IN, OH properties |
| **Valley National** | Secondary | Northeast, FL | Useful for FL and NJ-area properties |
| **Five Star** | Regional | Southeast | Select markets |
| **Old Second** | Regional | Midwest (IL) | Illinois-focused |

### Required Documents for Account Opening

Every bank requires essentially the same core documents. Prepare these before visiting:

| Document | Source | Notes |
|----------|--------|-------|
| Articles of Organization (certified copy) | State Secretary of State | Order 2-3 certified copies at formation |
| Certificate of Good Standing | State Secretary of State | Some banks require this; can be ordered same-day in most states |
| EIN Confirmation Letter (CP 575) | IRS | Print from online application or wait for mailed copy |
| Operating Agreement (fully executed) | Attorney | Banks review management authority and signatory provisions |
| Resolution Authorizing Account Opening | Attorney / Template | Board or member resolution naming authorized signers |
| Photo ID for All Signers | Each individual | Government-issued; most banks require two forms |
| Beneficial Ownership Certification | Bank form (CDD Rule) | Banks still require this under FinCEN Customer Due Diligence Rule regardless of CTA status |
| Signature Cards | Bank form | Completed at account opening |

### Account Types (Standard Structure)

| Account | Purpose | Minimum Signers | Typical Opening Deposit |
|---------|---------|-----------------|------------------------|
| **Operating Account** | Rent collection, vendor payments, payroll | Property Manager + CFO | $1,000 - $5,000 |
| **Security Deposit Account** | Tenant security deposits (legally required to be segregated in most states) | CFO | Varies by resident count |
| **Reserve Account** | CapEx reserves, insurance escrow, replacement reserves | CFO | Per lender requirements |

### Bank-Specific Notes

**Truist:**
- Online application available for Simple Business Checking (no monthly fee, up to 50 free transactions)
- Community Business Checking: no monthly fee, 225 free transactions, unlimited cash deposits
- Dynamic Business Checking: $20/month (waivable), 500 free transactions — best for active properties
- Requires EIN, LLC approval documents, and ID for all signers
- Plaid-compatible for QBO and RentManager integrations

**Flagstar:**
- Strong Midwest branch network — convenient for OH, MI, IN properties
- Business checking options with competitive fee structures
- Confirm Plaid compatibility before selecting for integration-heavy properties

**Valley National:**
- Good FL coverage for southern portfolio properties
- Commercial real estate lending relationships available
- Treasury management services for larger properties

### Plaid Compatibility

For properties integrated with QBO and RentManager payment processing, bank account Plaid compatibility is important. Truist is confirmed Plaid-compatible. For Flagstar, Valley National, Five Star, and Old Second, verify Plaid support before opening accounts if automated bank feeds are needed.

### Security Deposit Account Requirements by State

Several Sunrise states have specific requirements for security deposit handling:

| State | Segregation Required | Interest Required | Trust Account Required | Return Timeline |
|-------|---------------------|-------------------|----------------------|-----------------|
| OH | Yes | No | No | 30 days |
| IN | Yes | No | No | 45 days |
| MD | Yes | Yes (if deposit > $50 & 25+ units) | No | 45 days |
| MI | Yes | No | Regulated per statute | 30 days |
| FL | Yes (separate or surety bond) | Yes (75% of annualized avg rate OR 5% simple interest) | No | 15-60 days |
| MN | Yes | Yes (if held > 5 months) | No | 21 days |
| PA | Yes (if > 2 years) | Yes (if > 2 years) | No | 30 days |
| IL | Yes (if 25+ units) | Yes (if 25+ units) | No | 30-45 days |

**Note:** Check the mhp-regulatory expert skill for full state-by-state security deposit rules with statute citations.

---

## Registered Agent Selection

### Requirements

Every LLC must maintain a registered agent in each state where it is formed or registered as a foreign LLC. The registered agent must:

- Have a **physical street address** in the state (not a PO Box)
- Be **available during normal business hours** to accept service of process
- Be either an individual resident of the state OR a business entity authorized to do business in the state
- Promptly forward all legal documents to the LLC

### Provider Comparison

| Provider | Cost/State/Year | Best For | Volume Discounts | Compliance Dashboard |
|----------|----------------|----------|-----------------|---------------------|
| **CT Corporation** (Wolters Kluwer) | ~$436 | Large portfolios, law firm integration | Yes (enterprise) | Yes |
| **CSC** (Corporation Service Company) | ~$300 | Mid-to-large portfolios | Yes (contact sales) | Yes |
| **Northwest Registered Agent** | ~$125 | Cost-conscious, small-to-mid portfolios | First year free if forming through them | Yes |
| **Harbor Compliance** | ~$99-$175 | Bundled compliance services | Volume pricing available | Yes |
| **Incorp** | ~$129 | Mid-range, reliable | Yes | Yes |

### Selection Criteria for Sunrise

**Prioritize:**
1. **Multi-state support** — Must cover all 15 portfolio states from a single dashboard
2. **Compliance tracking** — Automated reminders for annual reports, franchise taxes, and filing deadlines
3. **Document forwarding** — Digital scanning and email delivery of served documents within 24 hours
4. **Annual report filing** — Ability to file annual reports as an add-on service
5. **Responsiveness** — Same-day notification of service of process

**Cost analysis for 15-state portfolio:**
- CT Corporation: ~$6,540/year
- CSC: ~$4,500/year
- Northwest: ~$1,875/year
- Harbor Compliance: ~$1,485-$2,625/year

**Recommendation:** For a growing 15-state portfolio, Northwest or Harbor Compliance offers the best value with adequate service levels. CT Corporation or CSC is justified only if legal counsel requires their premium compliance infrastructure.

---

## Insurance Binding

### Sunrise Insurance Structure

Sunrise maintains **master insurance policies** that cover the entire portfolio. New acquisitions are added to the existing master policy rather than obtaining standalone policies per property. This provides:

- Better premium rates through volume
- Consistent coverage across the portfolio
- Simplified renewals and claims management
- Blanket coverage limits that apply across properties

### Coverage Types Required at Closing

| Coverage | Minimum Limits (Typical) | When to Bind | Evidence Required |
|----------|-------------------------|--------------|-------------------|
| **Commercial General Liability (CGL)** | $1M per occurrence / $2M aggregate | Before closing | ACORD 25 |
| **Property Insurance** | Replacement cost of improvements | Before closing | ACORD 27 or 28 |
| **Umbrella / Excess Liability** | $5M-$10M (per portfolio policy) | Before closing | ACORD 25 |
| **Workers' Compensation** | Statutory limits | Before first employee starts | State-specific certificate |
| **Business Income / Loss of Rents** | 12 months actual loss sustained | Before closing | Included in property policy |
| **Flood Insurance** | NFIP limits or private market | Before closing if in flood zone | ACORD 28 or Elevation Certificate |
| **Environmental / Pollution Liability** | $1M-$5M (if applicable) | Before closing if Phase I recommends | Separate certificate |

### Insurance Binding Timeline

| Timing | Action |
|--------|--------|
| **LOI signed** | Notify insurance broker of potential acquisition; provide property address, lot count, improvement value |
| **Due diligence** | Broker obtains quotes; review Phase I environmental for pollution coverage needs; confirm flood zone status |
| **10 days pre-close** | Finalize coverage selections; provide broker with closing date, entity name (must match exactly), lender requirements |
| **5 days pre-close** | Broker issues binder (temporary proof of coverage) |
| **At closing** | Binder active; ACORD certificates delivered to lender and title company |
| **30 days post-close** | Final policy issued replacing binder; confirm all endorsements are correct |

### Adding to Master Policy — Checklist

- [ ] Provide broker with: Entity legal name, property address, lot count, total insured value
- [ ] Confirm entity name on policy matches entity name on deed and loan documents exactly
- [ ] Verify lender is named as additional insured and loss payee (mortgagee clause)
- [ ] Confirm property manager (SCI Management) is named as additional insured
- [ ] Obtain ACORD certificates for: lender, title company, property files
- [ ] Review deductible structure — ensure per-property deductible vs. blanket is clear
- [ ] Confirm builder's risk coverage if immediate construction/renovation planned
- [ ] Verify workers' comp coverage extends to the new state (if new state for portfolio)

### Lender Insurance Requirements (Typical)

Lenders (Fannie Mae, Freddie Mac, CMBS, local banks) typically require:
- Entity named as insured must match borrower entity exactly
- Lender named as mortgagee and additional insured
- 30-day notice of cancellation to lender
- Property insurance with replacement cost coverage (not ACV)
- Business income coverage for at least 12 months
- Ordinance or law coverage (increased cost of construction)
- Equipment breakdown coverage (HVAC, electrical systems)
- Flood insurance if any portion of the property is in a FEMA Special Flood Hazard Area

---

## Property Management Agreement

### Essential Terms for MHP Management Agreements

When a new property LLC enters into a management agreement with SCI Management LLC, include:

#### 1. Scope of Services
- Rent collection and deposit
- Lease administration (new leases, renewals, terminations)
- Maintenance and repair coordination
- Vendor management and procurement
- Code compliance and regulatory compliance
- Eviction processing
- Financial reporting (monthly P&L, rent roll, aged receivables)
- Budget preparation and adherence

#### 2. Management Fee Structure
- Percentage of effective gross income (EGI) — typically 5-8% for MHPs
- Define "EGI" clearly (gross potential rent - vacancy - concessions + other income)
- Incentive fees tied to NOI growth or occupancy milestones (if applicable)
- Reimbursable expenses vs. expenses included in management fee

#### 3. Authority and Spending Limits
- Spending authority per item (e.g., up to $2,500 without owner approval)
- Capital expenditure approval thresholds
- Leasing authority (standard lease terms vs. non-standard requiring approval)
- Legal action authority (eviction filings, collections, litigation)

#### 4. Reporting and Books
- Monthly financial reports due within 15 days of month-end
- Quarterly operating summaries
- Annual budget submission (90 days before year-end)
- Owner right to audit books at any time with reasonable notice

#### 5. Term and Termination
- Initial term (typically 1-3 years)
- Auto-renewal provisions
- Termination for cause (material breach, fraud, bankruptcy)
- Termination without cause (30-60 day notice)
- Transition obligations upon termination

#### 6. Insurance and Indemnification
- Manager to maintain E&O, CGL, and workers' comp coverage
- Mutual indemnification provisions
- Manager not liable for losses except in cases of negligence, fraud, or willful misconduct

#### 7. Compliance
- Fair Housing Act compliance (federal, state, local)
- State-specific MHP regulations
- ADA compliance
- Environmental regulations
- OSHA compliance for maintenance staff

---

## RentManager Property Setup

### Location Creation Checklist

When adding a new property to RentManager after acquisition:

#### Step 1: Create the Location
- [ ] Navigate to Admin > Properties > Add New Location
- [ ] Enter property legal name (matches entity name)
- [ ] Enter property physical address
- [ ] Assign Location ID (auto-generated or manually set)
- [ ] Set property type: Manufactured Housing Community
- [ ] Configure property status: Active

#### Step 2: General Ledger Configuration
- [ ] Set up Chart of Accounts aligned with Sunrise standard GL structure
- [ ] Map income accounts:
  - Lot Rent Income
  - Home Rent Income (POH)
  - Utility Reimbursement Income
  - Late Fee Income
  - Application Fee Income
  - Miscellaneous Income
- [ ] Map expense accounts per standard categories
- [ ] Verify GL codes match QBO mapping for consolidation
- [ ] Reference `rm-accounting-expert` skill for canonical GL structure

#### Step 3: Unit Inventory
- [ ] Create all lot/unit records with:
  - Unit number/lot number
  - Unit type (lot only, POH, vacant land, common area)
  - Square footage (if applicable)
  - Bedroom/bathroom count (for POH units)
  - Market rent amount
  - Status (Occupied, Vacant, Down, Not Available)
- [ ] Tag units by type: TOH (Tenant-Owned Home) vs. POH (Park-Owned Home) vs. Vacant Lot
- [ ] Verify unit count matches closing documents / rent roll

#### Step 4: Tenant Data Import
- [ ] Obtain seller's rent roll (verify against closing prorations)
- [ ] Import tenant records:
  - Legal name
  - Lease start/end dates
  - Current monthly rent
  - Security deposit amount
  - Move-in date
  - Contact information (phone, email)
- [ ] Verify imported data against source documents (spot-check at least 10% of records)
- [ ] Set up recurring charges for each tenant
- [ ] Import security deposit ledger entries

#### Step 5: Payment Processing Configuration
- [ ] Set up online payment portal for residents
- [ ] Configure ACH/check processing
- [ ] Set up late fee automation rules (per state rules — see mhp-regulatory skill)
- [ ] Configure payment posting rules

#### Step 6: Property Alias Configuration

Add the new property to the PROPERTY_ALIASES configuration for dashboard and reporting integration:

```javascript
const PROPERTY_ALIASES = {
  // Existing Properties
  "brookside": 3,      // Brookside Manor
  "colonial": 2,       // Colonial Estates
  "twin-lakes": 13,    // Twin Lakes
  "evergreen": 12,     // Evergreen
  "lamplighter": 14,   // Lamplighter
  "hillcrest": 15,     // Hillcrest
  "valley-view": 16,   // Valley View
  // New Property
  "new-property-name": XX,  // [Property Name] - Location ID from RM
};
```

**Files that may need updating:**
- Property alias config in reporting scripts
- KPI Dashboard property group membership
- Occupancy Dashboard configuration
- Monthly export scripts (`export_monthly_kpi_dashboard.py`, `export_occupancy_dashboard.py`)

#### Step 7: Reporting Integration
- [ ] Add property to appropriate reporting group in KPI Dashboard
- [ ] Verify property appears in occupancy dashboard
- [ ] Run test data pull to confirm API connectivity
- [ ] Validate initial KPI calculations against closing rent roll

---

## 100-Day Post-Acquisition Playbook

### Philosophy

The first 100 days set the trajectory for the investment. Value is created or destroyed in this window. Move decisively on systems integration and deferred maintenance, but proceed thoughtfully on rent increases and resident relationships.

**Key principle:** Residents are watching everything you do in the first 30 days. Every interaction signals whether you're a responsible steward or an absentee landlord. The goodwill built (or lost) in this window determines the ease of future rent increases and community improvements.

### Pre-Close Preparation (Before Day 0)

| Task | Owner | Timeline |
|------|-------|----------|
| Form LLC and obtain EIN | Attorney / Carlos | 30 days pre-close |
| Open bank accounts | CFO / Mike | 14 days pre-close |
| Draft resident welcome letter | Asset Mgmt / Sam | 14 days pre-close |
| Notify insurance broker and bind coverage | Ops | 10 days pre-close |
| Prepare RentManager Location | IT / Carlos | 7 days pre-close |
| Coordinate utility transfers | Ops / PM | 5 days pre-close |
| Prepare locksmith for day-one rekeying | Ops / PM | 3 days pre-close |
| Brief regional manager on property details | Asset Mgmt | 3 days pre-close |

### Week 1: Secure and Assess (Days 1-7)

**Day 1 — Closing Day:**
- [ ] Record deed and mortgage documents
- [ ] Change all locks, gate codes, office access codes
- [ ] Post "Under New Management" signage with emergency contact number
- [ ] Conduct initial property walk-through (photo/video document everything)
- [ ] Meet on-site staff; provide employee transition letters
- [ ] Deliver resident welcome letters (door-to-door or posted at mailboxes)
- [ ] Verify all utility accounts have transferred to new entity
- [ ] Collect all keys, remotes, access cards from seller's team

**Days 2-3 — Physical Assessment:**
- [ ] Full infrastructure walk: roads, drainage, water lines, sewer, electric
- [ ] Inventory all homes: TOH (tenant-owned) vs. POH (park-owned)
- [ ] Photograph every lot (occupied and vacant)
- [ ] Identify immediate safety hazards (exposed wiring, broken water mains, collapsed sewer lines)
- [ ] Document deferred maintenance backlog
- [ ] Test all common area systems (lighting, laundry, playground equipment)
- [ ] Review fire safety equipment (extinguishers, hydrants, egress)

**Days 4-7 — Operations Handoff:**
- [ ] Review seller's books: last 12 months P&L, rent roll, aged receivables
- [ ] Meet individually with every on-site employee (assess, reassure, set expectations)
- [ ] Identify and address any immediate vendor gaps (trash, lawn, snow removal)
- [ ] Set up temporary rent collection process (until RM is fully configured)
- [ ] Document all active legal matters (evictions in progress, pending litigation)
- [ ] Inventory all park-owned equipment (mowers, tools, vehicles)

### Weeks 2-4: Systems Integration (Days 8-30)

**Financial Systems:**
- [ ] Complete RentManager property setup with all tenant data
- [ ] Set up QBO entity and chart of accounts
- [ ] Process first rent cycle through new systems
- [ ] Reconcile seller closing prorations with actual collections
- [ ] Set up vendor accounts and payment processes
- [ ] Establish petty cash procedures for on-site staff

**Compliance:**
- [ ] File any required state/local business licenses
- [ ] Register with local fire department
- [ ] Update emergency contact information with county/municipality
- [ ] Verify property tax parcel numbers and payment status
- [ ] Confirm all required licenses/permits are current (MHP license, occupancy permits)
- [ ] Review all existing leases for compliance with state law

**Resident Relations:**
- [ ] Conduct community meeting (introduce management team, explain improvement plans)
- [ ] Distribute community rules and regulations
- [ ] Set up resident communication channels (office hours, emergency phone, portal)
- [ ] Begin processing pending maintenance requests from seller's backlog
- [ ] Address the three most visible improvement opportunities (quick wins)

**Staffing:**
- [ ] Determine staffing model (on-site manager, maintenance tech, or remote management)
- [ ] Process background checks and onboard retained employees
- [ ] Set up payroll through Paychex for on-site staff
- [ ] Establish performance expectations and job descriptions
- [ ] Provide fair housing training to all staff

### Month 2: Stabilize (Days 31-60)

**Revenue Optimization:**
- [ ] Complete market rent survey (comparable communities within 10-mile radius)
- [ ] Calculate loss-to-lease by unit
- [ ] Develop rent increase strategy (see mhp-regulatory skill for state-specific notice requirements)
- [ ] Review utility billing practices and identify pass-through opportunities
- [ ] Assess ancillary revenue potential (laundry, storage, RV parking, pet fees)

**Infrastructure:**
- [ ] Prioritize capital improvements by ROI and urgency
- [ ] Obtain bids for top 3-5 capital projects
- [ ] Address all safety hazards identified in Week 1 assessment
- [ ] Schedule preventive maintenance for water/sewer/electric systems
- [ ] Evaluate waste management contract (see vendor contract provisions below)

**Reporting:**
- [ ] First full month's financials completed and reviewed
- [ ] Property fully integrated into KPI Dashboard reporting
- [ ] First occupancy report generated and validated
- [ ] Compare actual NOI to underwriting assumptions — document variances
- [ ] Report property status to investors (if applicable)

### Month 3: Optimize (Days 61-100)

**Value-Add Execution:**
- [ ] Issue rent increase notices per state-specific requirements and timelines
- [ ] Begin infill program for vacant lots (if applicable)
- [ ] Execute first round of capital improvements
- [ ] Renegotiate or rebid underperforming vendor contracts
- [ ] Implement utility billing changes (if identified in Month 2)

**Performance Monitoring:**
- [ ] Second full month's financials — trend analysis vs. Month 1
- [ ] Track rent collection rate (target: >95% within 90 days)
- [ ] Monitor work order completion rate and response times
- [ ] Delinquency management: identify chronic late payers, begin remediation
- [ ] Run delinquency risk model on new property residents

**Strategic Planning:**
- [ ] Draft 12-month property business plan with improvement milestones
- [ ] Set Year 1 NOI target and track monthly vs. underwriting
- [ ] Identify Year 2 capital improvement priorities
- [ ] Complete "UW vs. Actuals" comparison (Q1 2026 Rock alignment)
- [ ] Present 100-day assessment to leadership: what worked, what surprised, what's next

### Day 100 Review Template

```markdown
## 100-Day Assessment: [Property Name]

**Acquisition Date:** [Date]
**Purchase Price:** $[X]
**Underwritten NOI:** $[X]
**Actual NOI (3 months annualized):** $[X]
**Variance:** [+/- X%]

### Key Wins
1. [Win 1]
2. [Win 2]
3. [Win 3]

### Surprises / Challenges
1. [Challenge 1 — and how addressed]
2. [Challenge 2]

### Financial Performance
| Metric | UW Assumption | Actual | Variance |
|--------|--------------|--------|----------|
| Physical Occupancy | X% | X% | +/- |
| Average Lot Rent | $X | $X | +/- |
| Collections Rate | X% | X% | +/- |
| Operating Expenses | $X | $X | +/- |
| NOI | $X | $X | +/- |

### Next 90 Days — Priorities
1. [Priority 1]
2. [Priority 2]
3. [Priority 3]
```

---

## Utility Transfer Procedures

### Overview

Utility transfers are one of the highest-risk operational items at closing. A gap in utility service can create habitability issues, resident complaints, and even code violations. Start the process 2-4 weeks before closing.

### Transfer Timeline

| Timing | Action |
|--------|--------|
| **21 days pre-close** | Contact all utility providers; request account transfer or new service effective closing date |
| **14 days pre-close** | Submit transfer applications; provide new entity name, EIN, and billing address |
| **7 days pre-close** | Confirm transfer dates with each provider; verify no outstanding balances from seller |
| **3 days pre-close** | Final confirmation call to each utility |
| **Closing day** | Verify service is active in new entity name |
| **Day 2-3** | Confirm first billing cycle under new account |

### Utility Types and Common Issues

#### Water & Sewer

**Master-metered communities (most common for MHPs):**
- Single account in park owner name — transfer to new entity
- Verify meter reading at closing for proration
- Review billing structure: flat rate vs. per-unit consumption
- If sub-metering: verify all sub-meters are functional
- If RUBS (Ratio Utility Billing System): review allocation formula

**Individually-metered communities:**
- Each lot has its own utility account in resident's name
- Park owner account covers common areas only
- Less transfer complexity but verify common-area accounts transfer

**Common issues:**
- Municipal water authorities may require a new application rather than a name change
- Outstanding utility liens may appear at title search — resolve before closing
- Some municipalities require a park license renewal upon ownership change

#### Electric

**Master-metered:**
- Transfer account to new entity; take meter reading at closing
- Review electrical infrastructure capacity (especially for older parks)
- Verify transformer ownership (utility-owned vs. park-owned)

**Individually-metered:**
- Individual lot accounts remain in resident names
- Transfer common area and office accounts to new entity
- Verify street lighting accounts transfer

**Common issues:**
- Utility deposits may be required for new accounts (can be $500-$5,000+ for master-metered)
- Transformer replacement responsibility varies by utility agreement
- Electrical code compliance issues in older parks (aluminum wiring, undersized panels)

#### Natural Gas / Propane

- If piped natural gas: transfer master account
- If individual propane tanks: identify current propane vendor, negotiate new contract or transfer
- If park-owned propane distribution: transfer bulk storage accounts, verify tank inspections are current
- **Safety:** Verify gas line condition — this is a high-liability infrastructure item

#### Waste Management / Trash

- Existing contract may or may not be assignable
- Review contract terms: rate, frequency, container count, recycling inclusion
- Negotiate new terms if contract is above market (common with mom-and-pop sellers)
- Verify dumpster count and placement is adequate for community size
- **Sunrise Q1 Rock alignment:** Waste Controls (Carlos) — new properties should use consolidated waste vendor terms

#### Internet / Cable

- Community-wide agreements (bulk internet) may transfer with assignment
- Individual accounts remain in resident names
- If park provides common-area WiFi: transfer or set up new account

### State-Specific Utility Billing Rules

| State | Key Restriction |
|-------|----------------|
| **MN** | No admin/capital/distribution markup on utility billing to residents |
| **FL** | Utility billing pass-through requires specific lease language |
| **OH** | Sub-metering allowed; must charge at same rate as utility charges park |
| **WI** | Landlord must follow PSC rules for utility billing |
| **IL** | Sub-metering regulated by local municipality rules |

**Reference:** See `mhp-operations-expert` and `mhp-regulatory` skills for full utility billing rules by state.

---

## Resident Notification Requirements

### Ownership Change Notifications

When a manufactured housing community changes ownership, most states require the new owner to notify residents. Requirements vary significantly by state.

*Last verified: March 2026. Consult local counsel before sending notifications — MHP-specific requirements may differ from general landlord-tenant law.*

### 15-State Notification Matrix

| State | Notice Required | Timing | Method | Content Requirements |
|-------|----------------|--------|--------|---------------------|
| **OH** | Yes | Reasonable time after closing | Written | New owner name, address, management contact, emergency number |
| **IN** | Yes | Reasonable time after closing | Written | New owner name, address, management contact |
| **MD** | Yes | Within 15 days of ownership change | Written | New owner name, address, management contact, rent payment instructions |
| **MI** | Yes | Within 15 days of ownership change | Written | New owner/manager name, address, phone, emergency contact |
| **FL** | Yes | Within 30 days of ownership change | Written or posted | New owner name, address, management company, rent payment instructions |
| **WV** | Yes | Reasonable time after closing | Written | New owner name, address, contact information |
| **PA** | Yes | Reasonable time after closing | Written | New owner name, address, contact, where to pay rent |
| **AL** | Yes | Reasonable time after closing | Written | New owner contact information |
| **GA** | Yes | Before next rent due date | Written | New owner name, address, rent payment instructions |
| **AR** | Recommended | Before next rent due date | Written | New owner contact, rent payment instructions |
| **MN** | Yes | Before next rent due date | Written | New owner name, address, contact, management company |
| **ND** | Recommended | Before next rent due date | Written | New owner contact, rent payment instructions |
| **WI** | Yes | Within 10 business days | Written | New owner name, address, contact information |
| **MO** | Recommended | Before next rent due date | Written | New owner contact, rent payment instructions |
| **IL** | Yes | Within 14 days (Chicago) / reasonable time (statewide) | Written | New owner name, address, management contact |

### Best Practice: Standard Welcome Letter

Regardless of state minimums, Sunrise should deliver a comprehensive welcome letter at closing or within 48 hours. Include:

1. **New ownership announcement** — who you are, your philosophy, what residents can expect
2. **Management contact information** — name, phone, email, office hours
3. **Emergency contact number** — 24/7 line for after-hours emergencies
4. **Rent payment instructions** — where and how to pay rent going forward
5. **Maintenance request process** — how to submit work orders
6. **Community rules reminder** — attach updated rules if changes are planned
7. **Introduction of on-site staff** (if applicable)
8. **Commitment to community improvement** — brief, genuine, specific

**Tone guidance:** Warm but professional. Residents may be anxious about new ownership (fear of rent hikes, evictions, park closure). Acknowledge their home is important to them. Emphasize continuity and improvement, not change for change's sake.

### Rent Increase Notice Requirements (Post-Acquisition)

Rent increases cannot be issued simultaneously with ownership change notices in most states. State-specific rent increase notice periods apply:

| State | Minimum Notice | Special MHP Rules |
|-------|---------------|-------------------|
| **MD** | 90 days (2 months for month-to-month) | 10% cap for 3 years post-acquisition |
| **FL** | 90 days | For MHP lot rent specifically |
| **MN** | 90 days | Longest notice period in portfolio |
| **IL** | 90 days (for MHP) | Chicago has additional requirements |
| **OH** | 30 days | No MHP-specific cap |
| **IN** | 30 days | No MHP-specific cap |
| **MI** | 30 days | Standard landlord-tenant |
| **WI** | 28 days | Standard landlord-tenant |

**Critical — MD regulatory note:** Maryland imposes a **10% rent increase cap for 3 years after a community changes ownership.** This directly impacts the value-add strategy for MD acquisitions. Factor this into underwriting.

**Reference:** See `mhp-regulatory` skill for complete rent increase notice requirements with statute citations.

---

## Business Licenses & Permits

### Overview

Manufactured housing community licensing varies significantly by state and locality. There is no uniform national standard. Check both state and local (county/municipality) requirements.

### State-Level Requirements

| State | MHP License Required | Issuing Agency | Renewal |
|-------|---------------------|----------------|---------|
| **OH** | Yes (Park License) | OH Dept of Commerce, Division of Real Estate | Annual |
| **IN** | Yes | IN State Dept of Health | Annual |
| **MD** | Check county requirements | County-level | Varies |
| **MI** | Yes (Mobile Home Park License) | MI LARA, Bureau of Construction Codes | Annual |
| **FL** | Yes (MH Community License) | FL DBPR, Division of Florida Condominiums, Timeshares, and Mobile Homes | Annual |
| **WV** | Check county requirements | County-level | Varies |
| **PA** | Check municipality requirements | Municipal-level | Varies |
| **AL** | Check county requirements | County-level | Varies |
| **GA** | Check county requirements | County-level | Varies |
| **AR** | Check county requirements | County-level | Varies |
| **MN** | Yes (MHP License) | MN Dept of Health | Annual |
| **ND** | Check county requirements | County-level | Varies |
| **WI** | Yes (Dealer/Installer License) | WI DSPS | Varies |
| **MO** | Check municipality requirements | Municipal-level | Varies |
| **IL** | Yes (MHP License) | IL Dept of Public Health (for parks with 5+ units) | Annual |

### Local License Checklist

For every new acquisition, verify the following with the local municipality/county:

- [ ] Business license / business privilege license
- [ ] MHP operating license or permit
- [ ] Health department permit (if park has water/sewer systems)
- [ ] Fire department inspection/permit
- [ ] Zoning compliance verification
- [ ] Sign permits (for community signage)
- [ ] Building permits (for any planned construction/renovation)

### Transfer vs. New Application

Some licenses automatically transfer with ownership; others require a new application. Always:

1. Review the purchase agreement for license transfer provisions
2. Contact the issuing agency at least 30 days pre-close to determine process
3. Budget for new application fees and inspection costs
4. Prepare for possible delays — some jurisdictions require physical inspections before issuing new licenses

---

## Vendor Contract Provisions

### Essential Contract Terms for MHP Vendor Agreements

All vendor contracts for newly acquired properties should include these provisions:

#### 1. Scope and Service Level
- Detailed description of services (frequency, coverage area, response times)
- Exclusions explicitly stated
- Service level standards with measurable KPIs
- Seasonal adjustments (snow removal, lawn care schedules)

#### 2. Pricing and Payment
- Fixed-price vs. variable-price structure
- Annual escalation caps (CPI-based or fixed %)
- Fuel surcharge provisions (for waste management, landscaping)
- Payment terms (Net 30 standard)
- No automatic price increases without written approval

#### 3. Term and Termination
- Initial term (prefer 1-year with renewal options vs. multi-year lock-in)
- Termination for convenience (30-60 day notice)
- Termination for cause (material breach, insurance lapse, safety violation)
- No auto-renewal without written notice and option to opt out
- Transition cooperation clause (vendor assists with handoff if terminated)

#### 4. Insurance Requirements
- CGL: $1M per occurrence / $2M aggregate minimum
- Auto liability: $1M combined single limit
- Workers' compensation: statutory limits
- Additional insured endorsement naming the property LLC and SCI Management
- Certificate of insurance provided annually and upon request
- 30-day notice of cancellation

#### 5. Indemnification
- Vendor indemnifies property LLC for vendor's negligence
- Mutual indemnification for each party's own acts/omissions
- Defense obligation (vendor provides legal defense for covered claims)

#### 6. Performance and Compliance
- Right to inspect and audit vendor's work
- Vendor compliance with all applicable laws, regulations, ordinances
- Background check requirements for vendor employees accessing the community
- Fair Housing compliance for any vendor interacting with residents

### Common Vendor Categories for MHPs

| Category | Key Contract Terms | Market Check Frequency |
|----------|-------------------|----------------------|
| **Waste Management** | Container count, pickup frequency, recycling, fuel surcharges, rate lock | Annually |
| **Landscaping** | Mowing schedule, edging, mulching, seasonal cleanup, irrigation | Annually |
| **Snow Removal** | Per-push vs. seasonal rate, trigger depth, salt/sand, response time | Annually (pre-season) |
| **Pest Control** | Monthly vs. as-needed, interior vs. exterior, termite coverage | Annually |
| **Tree Service** | Per-job pricing, emergency response, stump removal inclusion | As needed |
| **Plumbing** | Emergency response time, hourly rate, parts markup, sewer jetting | Every 2 years |
| **Electrical** | Emergency response time, hourly rate, parts markup, panel upgrades | Every 2 years |
| **Paving/Sealcoat** | Per-SF pricing, materials specification, warranty | Per project |

---

## Annual Compliance Calendar

### State Filing Requirements Summary

| State | Filing | Due Date | Fee | Late Penalty | Filing Agency |
|-------|--------|----------|-----|-------------|---------------|
| **OH** | None required | N/A | $0 | N/A | N/A |
| **IN** | Business Entity Report | Biennially, anniversary month | $32 (online) / $50 (mail) | Administrative dissolution risk | IN SOS |
| **MD** | Personal Property Return | April 15 | $300 | Forfeiture of good standing | MD SDAT |
| **MI** | Annual Report | February 15 | $25 | $50 late fee + dissolution risk | MI LARA |
| **FL** | Annual Report | May 1 | $138.75 | $400 late fee | FL DOS (Sunbiz) |
| **WV** | Annual Report | July 1 | $25 | $25 late fee | WV SOS |
| **PA** | Annual Report | September 30 | $7 | Pending (new requirement 2025) | PA DOS |
| **AL** | Business Privilege Tax | April 15 | $50 minimum | Penalties per AL tax code | AL DOR |
| **GA** | Annual Registration | April 1 | $60 | Administrative dissolution risk | GA SOS |
| **AR** | Franchise Tax Report | May 1 | $150 + $5 online fee | Revocation of good standing | AR SOS |
| **MN** | Annual Report | December 31 | $0 | Administrative dissolution risk | MN SOS |
| **ND** | Annual Report | November 15 | $50 | $50 late fee | ND SOS |
| **WI** | Annual Report | Anniversary quarter | $25 | Administrative dissolution risk | WI DFI |
| **MO** | None required (LLCs) | N/A | $0 | N/A | N/A |
| **IL** | Annual Report | Month before anniversary | $75 + $1.69 | Administrative dissolution | IL SOS |

### Annual Compliance Master Checklist

**January:**
- [ ] Review all state filing deadlines for the year
- [ ] Confirm registered agent service renewals
- [ ] Update beneficial owner records (internal — even though CTA domestic filing is suspended)

**February:**
- [ ] MI annual reports due (February 15)
- [ ] Begin preparing MD Personal Property Returns

**March:**
- [ ] K-1s due to members (March 15 for calendar-year entities)
- [ ] Begin tax return preparation

**April:**
- [ ] MD Personal Property Returns due (April 15)
- [ ] AL Business Privilege Tax due (April 15)
- [ ] GA Annual Registrations due (April 1)
- [ ] Entity tax returns due (March 15 for partnerships; April 15 for others; or extension)

**May:**
- [ ] FL Annual Reports due (May 1 — do not miss; $400 late fee)
- [ ] AR Franchise Tax Reports due (May 1)

**June-July:**
- [ ] WV Annual Reports due (July 1)
- [ ] Verify insurance renewals / policy reviews

**August-September:**
- [ ] PA Annual Reports due (September 30)
- [ ] Q3 property operating reviews

**October-November:**
- [ ] ND Annual Reports due (November 15)
- [ ] Prepare annual budgets for all properties

**December:**
- [ ] MN Annual Reports due (December 31)
- [ ] Year-end financial close preparation
- [ ] Review compliance status for all entities — certificate of good standing verification

**Ongoing / As-Needed:**
- [ ] IN Biennial Reports (anniversary month of formation)
- [ ] WI Annual Reports (anniversary quarter)
- [ ] IL Annual Reports (month before anniversary)
- [ ] Registered agent service renewals
- [ ] Insurance policy renewals
- [ ] Property tax payments (due dates vary by jurisdiction)
- [ ] MHP license renewals (annual, per state)

---

## Document Retention Requirements

### Permanent Records (Retain Indefinitely)

| Document | Rationale |
|----------|-----------|
| Articles of Organization (all versions) | Entity existence proof |
| Operating Agreement (all versions, amendments) | Governance authority |
| Member certificates / interest ledger | Ownership proof |
| Property deed | Real property ownership |
| Title insurance policy | Title defense |
| Survey / plat maps | Property boundary proof |
| Environmental reports (Phase I, Phase II) | Environmental liability defense |
| Easement and encroachment agreements | Property right documentation |
| Loan documents (promissory note, mortgage/deed of trust) | Debt obligations |
| Entity formation filings and EIN letter | Entity identity documents |
| Capital contribution records | Member investment basis |
| Major settlement agreements | Legal obligation documentation |

### 7-Year Retention

| Document | Rationale |
|----------|-----------|
| Tax returns (federal, state, local) and supporting schedules | IRS statute of limitations (3 years, extended to 6 for substantial understatement) |
| Bank statements and reconciliations | Financial audit support |
| General ledger and journals | Accounting records |
| Vendor contracts (after expiration) | Contract dispute window |
| Insurance policies (after expiration) | Claims that arise post-expiration |
| Payroll records and W-2s | Tax and employment law compliance |
| 1099s issued and received | Tax compliance |
| Capital improvement records | Depreciation and tax basis |
| Accounts payable records | Financial documentation |
| Investor correspondence and reports | Securities compliance |
| Legal correspondence | Legal documentation |

### 3-Year Retention (After Event Conclusion)

| Document | Rationale |
|----------|-----------|
| Tenant leases (3 years after move-out) | Landlord-tenant dispute window |
| Tenant applications and screening reports (3 years after denial or move-out) | Fair Housing compliance |
| Work orders (after completion) | Maintenance documentation |
| Routine correspondence | General records |
| Employee records (3 years after termination) | Employment law compliance |
| Inspection reports (after resolution) | Compliance documentation |
| Bid packages and proposals (after project completion) | Procurement records |

### 1-Year Retention

| Document | Rationale |
|----------|-----------|
| Superseded forms and templates | Reference only |
| Draft documents (after final version executed) | Process documentation |
| Routine vendor invoices (after payment confirmation) | Short-term reference |

### Digital vs. Physical

- **Original signatures required:** Operating agreements, deeds, loan documents — maintain physical originals in fireproof storage
- **Digital acceptable:** Bank statements, vendor invoices, routine correspondence, work orders — scan and store in organized digital filing system
- **Both recommended:** Insurance policies, tax returns, major contracts — digital for accessibility, physical for legal proceedings

---

## Decision Trees

### Formation State Selection

```
Is the property located in one of our 15 portfolio states?
  |
  YES --> Form LLC in the property's state (default)
  |         |
  |         Is there a lender with Delaware-formation requirement?
  |           |
  |           YES --> Form in Delaware + register as foreign LLC in property state
  |           NO  --> Form in property state (done)
  |
  NO --> Is this a new state for the portfolio?
    |
    YES --> Form in property state + set up registered agent in new state
    |       + research state-specific MHP regulations before closing
    NO  --> (This shouldn't happen if it's one of the 15 states)
```

### Bank Selection

```
What state is the property in?
  |
  Southeast / Mid-Atlantic (FL, GA, AL, MD, WV, PA) --> Truist (primary relationship)
  |
  Midwest (OH, IN, MI, MN, WI, ND, MO, IL) --> Flagstar or Old Second (IL-specific)
  |
  AR --> Truist or regional bank with local presence
  |
  Does the bank support Plaid integration?
    |
    YES --> Proceed
    NO  --> Evaluate alternative; Plaid needed for QBO/RM integration
  |
  Does the bank offer security deposit accounts compliant with state law?
    |
    YES --> Proceed
    NO  --> Find compliant alternative for security deposit account
```

### Insurance Structure

```
Is this the first property in a new state?
  |
  YES --> Verify master policy covers the new state
  |       |
  |       Workers' comp coverage extends to new state?
  |         YES --> Add property to master policy
  |         NO  --> Obtain workers' comp in new state (state-specific requirement)
  |
  NO --> Add to existing master policy (standard process)
  |
  Is the property in a FEMA flood zone?
    |
    YES --> Obtain flood insurance before closing
    NO  --> Standard coverage sufficient
  |
  Does Phase I environmental recommend pollution coverage?
    |
    YES --> Obtain environmental/pollution liability policy
    NO  --> Standard coverage sufficient
```

---

## Common Gotchas

### Entity Formation

| Gotcha | Impact | Prevention |
|--------|--------|------------|
| Entity name already taken in state | Delays formation by days/weeks | Check name availability on SOS website before filing |
| Applying for EIN before state filing is processed | IRS may reject or issue EIN to wrong entity | Wait for state confirmation before EIN application |
| Forgetting registered agent in new state | Non-compliance; no way to receive legal process | Set up registered agent as part of formation — never skip |
| Operating agreement not signed before closing | Bank may refuse to open account; lender may delay funding | Execute operating agreement at least 7 days pre-close |
| Missing certified copies of Articles | Multiple bank visits or filing requests needed | Order 3 certified copies at formation |

### Banking

| Gotcha | Impact | Prevention |
|--------|--------|------------|
| Bank requires in-person visit for LLC accounts | Delays if nearest branch is hours away | Confirm remote opening options in advance |
| Beneficial ownership certification confusion (CTA vs. CDD) | Banks still require CDD-mandated beneficial ownership forms even though CTA domestic filing is suspended | Prepare beneficial ownership docs for every bank visit |
| Account takes 5-10 business days to activate | Can't collect rent or pay vendors | Open accounts 2-3 weeks before closing |
| Bank won't open account without EIN letter | Circular dependency if EIN letter hasn't arrived by mail | Use the online confirmation printout (CP 575 equivalent) |
| Signer not authorized in operating agreement | Bank refuses to add signer | Ensure operating agreement lists all intended signers or grants manager authority |

### Insurance

| Gotcha | Impact | Prevention |
|--------|--------|------------|
| Entity name on policy doesn't match deed | Claims denied at worst; paperwork hassles at minimum | Triple-check entity name consistency across all documents |
| Workers' comp doesn't extend to new state | Violation of state law from day one | Verify multi-state coverage or obtain state-specific policy |
| Flood zone discovered at closing | Last-minute scramble for flood insurance | Check FEMA flood maps during due diligence |
| Prior owner's insurance lapses at closing | Gap in coverage | Coordinate cancellation/inception dates with both brokers |

### RentManager / Systems

| Gotcha | Impact | Prevention |
|--------|--------|------------|
| Tenant data import errors (wrong unit assignments) | Incorrect rent posting, tenant confusion | Spot-check 10% of records against source rent roll |
| GL structure doesn't match other properties | Inconsistent reporting, dashboard errors | Use standard Sunrise GL template for every property |
| Property not added to KPI Dashboard reporting group | Missing from management reports | Include dashboard integration in onboarding checklist |
| Late fee automation set wrong for state | State law violations | Consult mhp-regulatory skill for state-specific late fee rules |

### Utility Transfers

| Gotcha | Impact | Prevention |
|--------|--------|------------|
| Utility company requires deposit for new account | Unexpected $1,000-$5,000 cash outlay | Budget utility deposits in closing costs |
| Seller cancels utility before transfer effective | Service interruption to residents | Coordinate transfer dates (overlap by 1 day) |
| Outstanding utility lien on property | Surprise at closing | Title search should catch this; verify during due diligence |
| Municipal water authority requires new application + inspection | Weeks of delay | Contact utility 30+ days pre-close |

### Compliance

| Gotcha | Impact | Prevention |
|--------|--------|------------|
| FL annual report $400 late fee | Expensive and avoidable | Calendar FL May 1 deadline; file in January |
| MD 10% rent cap post-acquisition | Limits value-add strategy for 3 years | Factor into underwriting; adjust purchase price |
| Forgetting to file in new state | Entity falls out of good standing | Compliance calendar + registered agent service with reminders |
| MHP license not transferred at closing | Operating without a license | Contact licensing agency 30 days pre-close |

---

## Output Formats

### Entity Formation Checklist

```markdown
## Entity Formation: [Property Name]

**Entity Name:** SCI [Property Name] MHP LLC
**Formation State:** [State]
**Operating State:** [State]
**Target Close Date:** [Date]
**Attorney:** [Name]
**Responsible Party (EIN):** [Name]

### Pre-Closing — Entity Setup
| # | Task | Owner | Due Date | Status |
|---|------|-------|----------|--------|
| 1 | Check name availability | Attorney | [Date] | [ ] |
| 2 | File Articles of Organization | Attorney | [Date] | [ ] |
| 3 | Receive Certificate of Formation | Attorney | [Date] | [ ] |
| 4 | Appoint registered agent | Attorney | [Date] | [ ] |
| 5 | Apply for EIN (online) | Carlos | [Date] | [ ] |
| 6 | Draft Operating Agreement | Attorney | [Date] | [ ] |
| 7 | Execute Operating Agreement | All members | [Date] | [ ] |
| 8 | Open operating bank account | Mike | [Date] | [ ] |
| 9 | Open security deposit account | Mike | [Date] | [ ] |
| 10 | Bind insurance (add to master policy) | Ops | [Date] | [ ] |
| 11 | File business license applications | Ops | [Date] | [ ] |

### Post-Closing — Onboarding
| # | Task | Owner | Due Date | Status |
|---|------|-------|----------|--------|
| 12 | Record deed | Attorney | Day 1 | [ ] |
| 13 | Transfer utilities | PM | Day 1 | [ ] |
| 14 | Deliver resident notification | PM | Day 1-2 | [ ] |
| 15 | RentManager property setup | Carlos | Week 1 | [ ] |
| 16 | Import tenant data | Carlos | Week 1 | [ ] |
| 17 | Add to KPI Dashboard | Carlos | Week 2 | [ ] |
| 18 | Staff onboarding / Paychex setup | HR | Week 2 | [ ] |
| 19 | Community meeting | Sam / PM | Week 2-3 | [ ] |
| 20 | First rent cycle through new systems | Mike | Month 1 | [ ] |

### Key Information
| Item | Value |
|------|-------|
| Entity Name | SCI [Name] MHP LLC |
| Formation State | [State] |
| State File # | [Number] |
| EIN | XX-XXXXXXX |
| Location ID (RM) | [Number] |
| Operating Account | [Bank] — XXXX |
| Security Deposit Account | [Bank] — XXXX |
| Registered Agent | [Service Name] |
| Insurance Broker | [Name] |
| Policy # | [Number] |
```

### Onboarding Tracker (Multi-Property)

```markdown
## Portfolio Onboarding Status — [Quarter/Year]

| Property | State | Entity Formed | EIN | Bank Accts | Insurance | RM Setup | 100-Day Status |
|----------|-------|:------------:|:---:|:----------:|:---------:|:--------:|:--------------:|
| [Name 1] | OH | Done | Done | Done | Done | In Progress | Day 45 |
| [Name 2] | FL | Done | Done | Pending | Pending | Not Started | Pre-Close |
| [Name 3] | IN | In Progress | — | — | — | — | Pre-Close |
```

### 100-Day Plan (Condensed)

```markdown
## 100-Day Plan: [Property Name]

**Acquisition Date:** [Date]
**Property Manager:** [Name]
**Asset Manager:** [Name]

### Phase 1: Secure & Assess (Days 1-7)
- [ ] Change locks and access codes
- [ ] Deliver resident welcome letters
- [ ] Complete property walk-through with photo documentation
- [ ] Meet on-site staff
- [ ] Verify utility transfers
- [ ] Document deferred maintenance backlog

### Phase 2: Integrate (Days 8-30)
- [ ] Complete RentManager setup
- [ ] Process first rent cycle
- [ ] File business licenses
- [ ] Community meeting
- [ ] Address top 3 visible improvements (quick wins)

### Phase 3: Stabilize (Days 31-60)
- [ ] Market rent survey completed
- [ ] Loss-to-lease analysis
- [ ] Capital improvement prioritization
- [ ] First full month financials reviewed
- [ ] KPI Dashboard integration verified

### Phase 4: Optimize (Days 61-100)
- [ ] Rent increase notices issued (per state requirements)
- [ ] Vendor contracts renegotiated
- [ ] UW vs. Actuals comparison completed
- [ ] 12-month property business plan drafted
- [ ] 100-Day Assessment presented to leadership
```

---

## References

### Internal Resources
| Resource | Location |
|----------|----------|
| MHP Operations Expert | `.claude/skills/mhp-operations-expert/skill.md` |
| MHP Regulatory Skill | `.claude/skills/mhp-regulatory/skill.md` |
| RM Accounting Expert | `.claude/skills/rm-accounting-expert/skill.md` |
| Paychex Expert | `.claude/skills/paychex-expert/skill.md` |
| Data Dictionary | `/Operations/data-pipeline-consolidation/DATA_DICTIONARY.md` |
| KPI Export Script | `/rentmanager-mcp/export_monthly_kpi_dashboard.py` |
| Occupancy Export Script | `/rentmanager-mcp/export_occupancy_dashboard.py` |
| Shared Config | `/rentmanager-mcp/shared_config.py` |

### External Resources
| Resource | URL |
|----------|-----|
| IRS EIN Online Application | irs.gov/EIN |
| FinCEN BOI (CTA) | fincen.gov/boi |
| LLC University — Filing Fees by State | llcuniversity.com/llc-filing-fees-by-state/ |
| LLC University — Annual Fees by State | llcuniversity.com/llc-annual-fees-by-state/ |
| LLC University — Foreign LLC Fees | llcuniversity.com/foreign-llc-fees-by-state/ |
| Harbor Compliance — Entity Formation Fees | harborcompliance.com/entity-formation-fees |
| Harbor Compliance — Annual Reports | harborcompliance.com/llc-corporation-annual-report |
| Fannie Mae MHC Guide | mfguide.fanniemae.com/node/3656 |

### State Secretary of State Websites (15 Portfolio States)
| State | Business Filing Portal |
|-------|----------------------|
| OH | sos.state.oh.us |
| IN | inbiz.in.gov |
| MD | egov.maryland.gov/BusinessExpress |
| MI | michigan.gov/lara |
| FL | dos.fl.gov/sunbiz |
| WV | sos.wv.gov |
| PA | dos.pa.gov |
| AL | sos.alabama.gov |
| GA | sos.ga.gov/corporations |
| AR | sos.arkansas.gov |
| MN | sos.state.mn.us |
| ND | sos.nd.gov |
| WI | dfi.wi.gov |
| MO | sos.mo.gov |
| IL | ilsos.gov |

---

*This skill is maintained as part of the Sunrise Communities knowledge base. Regulatory and fee data should be revalidated quarterly. Last comprehensive review: March 2026.*