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TAMA 38 – The Complete Guide

TAMA 38 guide - Barnea- Real Estate lawyer

What Is a TAMA 38 Plan?

In March 2005, the Israeli government resolved to approve and implement a national outline plan, known as TAMA 38, to reinforce buildings from the risk of earthquakes.

 

Despite the existence of Israeli regulations requiring the sturdiness of new buildings against earthquakes since 1975, such regulations do not apply to old structures. Therefore, there was a need for a national plan to reinforce structure constructed before the regulations took effect, in order to prevent the collapse of the buildings and any casualties.

 

Because implementing the plan required enormous financial resources that residents could not afford, the government decided that apartment owners interested in reinforcing and improving the sturdiness of their buildings against earthquakes would be granted, through the TAMA 38 plan, permits to construct an additional residential unit in the building. The additional residential unit would be transferred to a contractor to perform the reinforcement work. Thus, residents were assured peace of mind and a sturdier, reinforced building to better withstand earthquakes, without shouldering the financial burden for strengthening the structure.

 

To Which Buildings Does the Plan Apply?

The plan does not apply to buildings and structures that are not permanently occupied, such as storage buildings, buildings of less than two stories built on an area of less than 400 square meters, and buildings that have been issued a final demolition order by a court.

 

Residents are required to execute a contract with the chosen contractor in order to affirm that their rights to the building’s roof are transferred to the contractor. The contractor is required to commit to the residents to perform the following, as part of the TAMA 38 regulations:

  • Stabilizing and reinforcement of the structure against earthquakes.
  • Construction and addition of an elevator within the structure.
  • Addition of bomb secure rooms to the existing apartments.
  • Renovation and improvement of the stairwell according to the national outline plan.
  • Renovation of the building’s façade (an in some cases, even covering the structure as required by the municipality).
  • Renovation of the trash room.
  • Improvement of the garden and parking area.
  • Expansion of the building’s apartments (subject to approval by the municipality).
  • Construction or addition of sun balconies.

It should be noted that in light of the reinforcement and renovation works conducted on the structure, appraisers estimate that the value of the apartments may increase by 15–30 percent, with no financial expense on the part of the residents.

 

What Should One Know Before Signing a Contractual Agreement with the Contractor?

 Who is the performing contractor?

  • The contractor’s financial abilities.
  • The contractor’s experience executing similar projects and assurance that the contractor has indeed performed them.
  • The level of such projects’ residents’ satisfaction with the contractor.
  • That the contractor’s insurance policy is in fact appropriate and meets the requirements of TAMA 38’s regulations and is still in effect.

When executing the contract itself, one should make sure it includes the following details:

The Contractor’s Details: The contract must include the contractor’s personal details, his personal address, the company number, and the details of the person authorized to sign on behalf of the company, along with the contractor’s obligation to the agreement.

The Building Permit: It is recommended to add a term to the agreement stipulating that the agreement will take effect upon the granting of a building permit from the municipality and the receipt of such permit prior to commencement of the work.

Details of the Work: It must be ensured that all details of the work the contractor is obligated to perform are noted and detailed in the agreement, including details of the reinforcement and renovation of the internal and external structure (elevator, location of parking, etc.).

Timeline for the Work’s Performance: Residents may stipulate that the construction of the additional residential unit on the roof shall be performed only after the structure’s reinforcement works are completed. In addition, it is possible to provide in the agreement that any diversion or delay in the date for completing the construction work shall lead to the residents being paid a contractor’s penalty.

The Date for Commencement of the Work: Upon execution of the agreement, target dates for the application for building permits by the contractor and for the commencement of the construction work should be set, according to the timeline established during execution.

The Date for Completion of the Work: Under this section, it is recommended to emphasize that should the contractor fail to meet the timeline defined in advance, and not complete the reinforcement works in a timely manner, the residents may exercise the penalties and sureties as guaranteed in the agreement, and be compensated according to the period of delay.

Sureties: To ensure the works are performed as obligated, even if the contractor decides to cease performing the work, it is possible to require a bank guarantee to secure the costs of the completion of the construction work.

Registration and Amendment of the Condominium Order: It must be ensured that the contractor is responsible for amending the registration of the condominium and the new apartments. In addition, the residents may demand that the roof area of the new apartments and the stairwell be the common property of the residents.

Systems Located on the Roof of the Building: The agreement must include the contractor’s warrantee for the financial expenses for transferring the various cable and electricity systems (including antennas, satellite dishes, solar systems, and boilers) onto the new roof. It must be ensured that the contractor is responsible for proper functioning of such systems after their transfer.

Taxes and Payments: It is recommended that the agreement include a term that obligates the contractor to shoulder all the payments of taxes and other expenses of the transaction.

Quality of Material and Work: It is recommended to demand that the contractor use quality materials, intended for structure reinforcement work, and which meet the quality standards for the TAMA 38 plan.

Interference with the Comfort of Residents during Construction: The time frame for daily and weekly work hours should be defined in advance in order to minimize and measure interference with the comfort of the residents during construction.

Insurance: The agreement should expressly include a section in which the contractor promises to pay the expenses for insuring the structure, including insurance covering the facilities, building materials, and any other equipment at the contractor’s disposal during the construction works. Additionally, the insurance must cover instances of loss or injury to the person of anyone during the period of the construction, including the contract workers, the subcontractor, and its workers, as well as the residents of the building, or any other person in the vicinity of the building. Note that the insurance covers all the cases stated above, including instances of injury, harm, or loss, whether caused directly or indirectly to property or person. Above all else, make sure to be provided with a copy of the insurance policy.

Legal Advice: It is recommended to receive legal assistance throughout all stages of the project and to demand that the contractor shoulder the expense for attorney’s fees for the purposes of executing the agreement.

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