In this session, there are a couple of bills currently on our radar that may directly impact Arizona HOAs.
HOA Priority Bills:
HOMEOWNERS’ ASSOCIATIONS; DELCARATON AMENDMENT; VOTE
For condominium associations and planned community homeowners’ associations, amendments to a declaration are required to receive an affirmative vote or written consent of at least three-fourths of the unit owners or eligible voters present at a meeting where a quorum is present.
Last Action: 1/22/25 – Removed from House Government hearing
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HOMEOWNERS’ ASSOCIATIONS; RECORDS REQUESTS
Requires homeowner association records requests to be made in good faith, describe the proper purpose, and be directly connected to the purpose. Records that are made available online are deemed to be reasonably available.
Last Action: 1/20/25 – Referred to House Government
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HOMEOWNERS’ ASSOCIATIONS; VIRTUAL MEETINGS; PROXIES
Authorizes homeowners’ associations and condominium boards to conduct meetings through online or virtual platforms. Specifies requirements for absentee ballots, including content and delivery methods, for voting conducted during virtual or in-person meetings. Prohibits the use of proxies for voting after the declarant control period and establishes guidelines for quorum requirements.
Last Action: 1/20/2025 – Referred to House Government
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HOMEOWNERS’ ASSOCIATIONS; ASSESSMENTS; LIENS; PAYMENTS
Differentiates homeowners association assessments that are a common expense lien or a judgment lien. If an association member wants to change the application of payments received against their account, they must direct otherwise in an instrument signed by the unit owner.
Last Action: 1/20/25 – Referred to House Rules – Referred to House Government
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CONDOMINIUMS; COMMERCIAL STRUCTURES; RESIDENTIAL STRUCTURES
Requires that any common expenses in a condominium with separate commercial and residential structures be allocated based on the benefit to each structure. Expenses exclusively benefiting a commercial structure must be assessed only to the commercial units, while those benefiting a residential structure must be assessed only to the residential units. Expenses benefiting both structures must be proportionally allocated between them and assessed on a pro rata basis. Places the burden of proof on the condominium association to demonstrate compliance with these allocation requirements in case of disputes. Applies to all condominiums existing on or after the effective date of this legislation.
Last Action: 1/20/2025 – Referred to House Commerce
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CONDOMINIUMS; PLANNED COMMUNITIES; DIRECTORS’ DUTIES
Requires the members of a condominium association or planned community homeowners’ association board of directors to act in good faith, with ordinary prudence, and in the best interests of unit owners as a whole. Board members are indemnified from liability for actions performed in compliance with these duties but are liable for damages if they breach these responsibilities.
Last Action: 1/22/2025 – Referred to House Rules – Referred to House Government
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HOMEOWNERS’ ASSOCIATIONS; BUDGET RATIFICATION; REQUIREMENTS
Requires the board of directors of homeowners’ associations (HOAs) and condominium associations to develop and adopt annual operating budgets based on a reasonable and good faith estimate of anticipated common expenses. If the proposed budget results in an annual assessment increase exceeding the consumer price index percentage for the prior 12 months, it must be ratified by a majority of unit owners or members. Noncompliance with these requirements renders actions or assessments invalid. HOAs are authorized to establish reserve accounts to address anticipated long-term or major maintenance and upgrade of common elements.
Last Action: 1/22/25 – Referred to House Rules – Referred to House Government
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CONDOMINIUMS; CONSTRUCTION DEFECTS; ACTIONS
Modifies the time limitations for initiating construction-related legal actions or arbitrations. It reduces the period for bringing actions against developers or construction professionals from eight years to four years after substantial completion or acceptance by a municipality or county. For latent defects or injuries to property discovered during the fourth year, actions may be brought within two years but no more than six years after substantial completion. These time limits apply to claims filed after the effective date of this legislation. Establishes requirements for condominium associations to initiate construction defect claims. The board of directors must secure approval by a 2/3 vote of unit owners before proceeding with legal action. Prior to voting, a registered professional engineer must inspect the alleged defects, and the findings must be disclosed to all relevant parties, including unit owners and developers. Associations must notify developers and construction professionals of the defect claims and provide them an opportunity to cure any defects after a favorable vote.
Last Action: 1/26/2025 – Referred to House Rules – Referred to House Government
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HOA’S; TERMINATION OF DECLARANT
Numerous changes to condominium association and planned community associations (HOAs). The period of declarant control terminates two years, instead of four years, after all declarants have cased to offer units for sale, or 60 days after the effective date of this legislation for any HOA that satisfies listed criteria. Failure to terminate declarant control may result in civil penalties of up to $500. Establishes a list of duties that the declarant has to the HOA and unit owners or members during the period of declarant control. After the termination of declarant control, the declarant retains rights to develop, market, and manage remaining units as outlined in the declaration or plat, without interference from the HOA. The HOA cannot amend the declaration to impact these rights without the declarant’s consent and must maintain common elements to established standards. Control over the HOA transfers to the elected board and unit owners or members, and any restrictions on their authority are invalid. Violations of the declarant’s rights may result in civil penalties of up to $100 per day.
Last Action: 1/26/2025 – Referred to House Rules – Referred to House Regulatory Oversight
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HOMEOWNER’S ASSOCIATIONS; MEETINGS; RECORDINGS
Requires homeowners’ associations (HOAs) to retain unedited audio or video recordings of their meetings for at least six months and to provide these recordings to any HOA member upon request.
Last Action: 1/27/25 – Placed on Senate Caucus Calendar
Click Here for Bill Overview