Homeowners’ associations evolve over time as the world around us changes. For example, a new law gets enacted (e.g., marijuana legalization), or new safety or communication needs arise. Sometimes in response, an HOA must create a new rule or amend a bylaw. Boards must know how to change HOA rules properly. You’ll want to be legally compliant, and manage the concerns of HOA members. This guide tells how to add rule amendments.
Understand HOA Document Hierarchy
Understanding the authority of an HOA’s governing documents is crucial to amending them. And in order to understand the hierarchy of authority, you need to understand the definition of each section.
Recorded Plat
The plat is a type of survey that shows the property dimensions and features before development.
Declaration of Covenants, Conditions and Restrictions (CC&Rs)
CC&Rs are the rules that govern the use and development of the property your homes are built on. This helps ensure the property is used as the developer intended, to maintain consistency in the community, and to maintain property values.
Articles of Incorporation
An HOA’s Articles of Incorporation contain all the basic information related to it being formalized and designated as an HOA. This includes name and address, the directors on the first board, and the law under which the HOA received its designation.
Bylaws
Bylaws are the internal rules about how the HOA is run on a daily basis, in large part pertaining to the board of directors. Homeowner rules appear in the form of declarations (or “decs”) or bylaws that every homeowner receives and must agree to prior to moving in.
Board Resolutions
The Board Resolutions formalizes and makes legally binding the decisions the board makes.
A common question is “do bylaws supersede covenants?”. First, federal and state law trump all else. Under that is the Plat, and then the Declaration of Covenants, Conditions, and Restrictions. The Declaration of CC&Rs supersedes the Articles of Incorporation and the bylaws. Board rules and resolutions have the lowest level of authority and are trumped by the other legal documents.
The pyramid above shows the hierarchy of document authority. With proper legal counsel, all the other items in your pyramid adhere to Federal and State law. If you are amending HOA covenants or bylaws, you must get your required association votes before the change goes into effect. In other cases, rules may not need association owner approval, and the board can simply approve it.
Importance of Attorney Review
If the board has decided to amend a rule or create a new one, you most likely will have to involve an attorney. Declarations and bylaws are considered legal documents, and any changes made to them must be reviewed by a legal professional. If the amendment is too complicated or detailed, we strongly recommend consulting an attorney. However, if the proposed change is minor, like “no reversing into your parking spot,” then the board may be able to forgo legal assistance. Additionally, an attorney will be able to point out any contradictions to the current declarations or bylaws, as they supersede anything in the rules. Here’s how to know if your change is a rare case where you do not need an attorney… if you are absolutely positive that your new rule is:
- very simple
- drafted properly
- doesn’t contradict any items on the pyramid above Board Resolutions
Implement HOA Rules Change
1. Draft your amendment to the rules
State in clear language what the rule amendment is. Anticipate if there are actions you need to take in order to get approval. For example, let’s say you want a rule stating that you can use email for association correspondence instead of paper letters. You will want to disseminate a form, or some other mechanism, to collect every owner’s email address.
2. Notice of Proposal
Once the board has proposed an amendment, they must send out a notice between 10 and 30 days before the next board meeting; no more, no less. The notice must include the:
- proposed rule change, written as it will be in the document
- description of the purpose
- effect the rule change has
The only instance where notice is not necessary is if the rule is urgently addressing:
“an imminent threat to public health or safety or imminent risk of substantial economic loss to the association”.
3. Board meeting approval
At the meeting where the board will seek to approve the rule, board members must open the floor to homeowners for discussion and questions. The rule change proposal must be on the agenda. As stated above, if you are proposing amending HOA covenants or other governing documents on the pyramid, it must get owner votes. Otherwise, the board can approve on their own.
4. After rule approval
Following the meeting where the board approves the rule proposal, it must send notice to the whole community with the details. This must be completed within 15 days of the decision. Here is an example of an original notice with the details added post-approval. You may use this as a rule change notice template.
