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Texas HOA Law – 2013 Legislative Update

1/31/2014

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Rosebrook Homeowners Association, Whitehouse, Texas, whitehouse real estate, moving to whitehouse texas, Rosebrook Circle, Rosebrook Circle Whitehouse Texas
On May 27, 2013, the Texas Legislature concluded the 2013 legislative session.  Unlike the 2011 legislative session, in which the Texas Legislature enacted the most significant reforms to Texas HOA laws in almost 20 years, the legislation passed by the Legislature in the 2013 session is relatively minor in scope.  The following is a brief description of such soon-to-be new laws.  

If you want to view copies of the actual bills themselves or a brief summary of all such bills, please click on the appropriate pdf-link to the right.

House Bill 2075 – the Condominium Omnibus Bill

HB 2075 is the most significant in scope of all of the bills passed by the Texas Legislature in 2013.  HB 2075 amends several provisions of Chapter 82 of the Texas Property Code (known as the “Texas Uniform Condominium Act” or “TUCA” for short), and for such reason is referred to as an “omnibus” bill.  TUCA governs all Texas Condominiums created after 1993, but certain provisions of such statute also govern Texas Condominiums created prior to 1994.  The provisions of TUCA modified by HB 2075 apply to all Texas Condominium Associations.  

The first modification of TUCA by HB 2075 is to Section 82.102, which governs the powers of a Condominium Association.  Texas Condominium Associations are now expressly authorized to borrow money and to assign as collateral for the loan, the Condominium Association’s right to future income and assessments and its lien rights.  If a Condominium Association’s Declaration requires Unit Owner approval for the Condominium Association to borrow money or assign future income, assessments or lien rights, then the vote may be conducted electronically, by absentee ballot, in person or by proxy at a meeting of Unit Owners or by written consent of the Unit Owners.  In addition, if Unit Owner approval is required by the Declaration, HB 2075 reduces the approval threshold to either the threshold established by the Declaration or 67%, whichever is lower.

The second modification of TUCA by HB 2075 is to Section 82.111, which governs a Condominium Association’s obligation to acquire and maintain insurance coverage for the condominium development and the use of insurance proceeds and the obligation to repair or rebuild portions of the condominium development damaged by a casualty event covered by insurance.  Prior to 2013, Section 82.111 required a Condominium Association to promptly repair or replace any portion of a condominium development for which insurance is required that is damaged or destroyed unless: (1) the condominium development is terminated; (2) repair or replacement would be illegal under any state or local health or safety statute or ordinance; or (3) at least 80 percent of the unit owners, including each owner of a unit or assigned limited common element that will not be rebuilt or replaced, vote to not rebuild.  As modified by HB 2075, a vote to not repair or rebuild by at least 80% of the unit owners no longer requires that such vote also be approved by each owner of a unit or assigned limited common that will not be repaired or rebuilt.  In addition, a vote to not repair or rebuild may be cast electronically or by written ballot if a meeting of unit owners is not to be held, or in person or by proxy at the meeting if a meeting of unit owners is to be held.

The third modification of TUCA by HB 2075 is also to Section 82.111.  HB 2075 modifies Section 82.111 to make clear that insurance policies maintained by the Association may provide for commercially reasonable deductibles, as determined by the Board of Directors to be appropriate or necessary.  In addition, if the cost to repair damage to a unit or common element covered by the Condominium Association ’s insurance is less than the amount of the applicable insurance deductible, the party who would be responsible for the repair in the absence of insurance must now pay the cost for the repair of the unit or common element instead of a claim being submitted to the insurance carrier.  If the cost to repair damage to a unit or common element covered by the Condominium Association ’s insurance is more than the amount of the applicable insurance deductible, then the expense of the insurance deductible and other costs incurred by the Association before insurance proceeds are available may now be assessed against unit owners in the manner provided by the Condominium Association’s Declaration.  If the Condominium Association’s Declaration is silent on this issue, the Condominium Association’s Board of Directors must adopt and record a resolution that provides for the assessment of such costs, or such costs will be considered a common expense of the Condominium Association.  Finally, if the damage to a unit or the common elements is due wholly or partly to an act or omission of any unit owner or a guest or invitee of the unit owner, the Condominium Association may now assess the deductible expense and any other expense in excess of insurance proceeds against the owner and such owner’s unit.

The fourth and final modification of TUCA by HB 2075 is to Section 82.113, which governs the foreclosure of a Condominium Association’s assessment lien.  Prior to 2013, if a Condominium Association foreclosed its assessment lien against a unit, such foreclosed unit was subject to a right of redemption by the unit owner only if the unit was purchased by the Condominium Association at the foreclosure sale.  Now, a foreclosed unit is subject to a unit owner’s right of redemption regardless of who purchases the unit at an assessment lien foreclosure sale.

House Bill 35 – Residential Use of Adjacent Lots

HB 35 adds Section 209.015 to Chapter 209 of the Texas Property Code, which governs Homeowners Associations that oversee subdivision developments (often referred to as “Subdivision Associations”).  New Section 209.015 restricts a Subdivision Association from adopting or enforcing a provision in a Dedicatory Instrument that would prohibit or restrict an owner of a lot on which a residence is constructed from using an adjacent lot also owned by such owner for “residential purposes.”  Section 209.015 defines use of an adjacent lot for “residential purposes” as the location of buildings, structures or other improvements customarily appurtenant to a residence (as opposed to use for business or commercial purpose), including the location on the adjacent lot of a garage, sidewalk, driveway, parking area, children’s swing or playscape, fence, septic system, swimming pool, utility line, water well and/or, if permitted by the applicable Declaration, the parking or storage of a recreational vehicle.  New Section 209.015 still requires a homeowner to obtain advance approval from the architectural committee (or Homeowners Association, as applicable) based on criteria prescribed by the applicable Dedicatory Instruments specific to the use of such lot for “residential purposes,” including reasonable restrictions regarding size, location, shielding, and aesthetic of the “residential purpose.”  In other words, if a homeowner wanted to install a swimming pool on an adjacent lot, the homeowner may now do so despite any restrictive covenant to the contrary but such homeowner must still get approval from the  architectural committee based on criteria applicable to swimming pools in the Homeowners Association’s Dedicatory Instrument, including any reasonable restrictions regarding the size, location, shielding, and aesthetics of the swimming pool.  If a homeowner elects to use an adjacent lot for “residential purposes,” when he or she goes to sell or transfer ownership of the lot on which the residence is built, he or she must either include the adjacent lot in the sales agreement and transfer such adjacent lot to the new owner of the lot containing the residence or must restore the adjacent lot to the original condition before he addition of the “residential purpose” improvements.

House Bill 503 – Contracts between Subdivision HOAs and Directors

HB 503 adds Section 209.0052 to Chapter 209 of the Texas Property Code.  New Section 209.0052 imposes certain restrictions upon the ability of a  Subdivision Association to enter into a contract for goods or services with a current Director, a person related to a current Director within the third degree by consanguinity or affinity, or a company owned by a current Director or  a person related to a current Director within the third degree by consanguinity or affinity.  A Subdivision Association may only enter into a contract with a current Director, a current Director’s relative, or a company owned by a current Director or a current Director’s relative if: (1) the Subdivision Association has received at least 2 other competitive bids for the contract from persons not associated with the Director, relative, or company (if reasonably available); (2) the applicable Director is not given access to the other bids, does not participate in any Board of Directors’ discussion regarding the contract, and does not vote on the award of the contract; (3) the relationship concerning the applicable Director is disclosed to or known by the Board of Directors and the Board of Directors, in good faith and with ordinary care, authorizes the contract by affirmative vote of the majority of the Directors who do not have a conflict of interest; and (4) the Board of Directors certifies by a resolution that the requirements of Section 209.0052 have been met.

House Bill 680 – Location of a Flagpole in the Front Yard or attached to a Home

In 2011, the Texas Legislature enacted Section 202.011 of the Texas Property Code, which restricts the enforcement of restrictive covenants that would prohibit a Homeowner from flying the flags of the United States, Texas or a branch of the United States military on his or her lot, but which still allowed a HOA to adopt and/or enforce provisions in its Dedicatory Instruments that would regulate the size, number, and/or location of flags, flag poles and lights used to illuminate flags.  HB 680 modifies Section 202.011 to make clear that an HOA’s regulation of the location of flags cannot restrict a Homeowner from erecting at least one flagpole that is located in the “front yard” of the property or is attached to any portion of the Homeowner’s home.  For purposes of Section 202.0011, the term “front yard” is defined as “a yard within a lot having a front building setback line with a setback of not less than 15 fee extending the full width of the lot between the front lot line and the front building setback line.”

House Bill 2978 – Authority of Courts to Order Mediation in Expedited Foreclosure Proceedings

In 2011, the Texas Legislature enacted a new law that requires Subdivision Associations to obtain a court order through an expedited foreclosure proceeding before it can non-judicially foreclose its assessment lien.  A court in which an expedited foreclosure proceeding is pending may now order the parties to mediate the matter if the delinquent Homeowner files a response to the Subdivision Association’s application for an expedited foreclosure proceeding and the court conducts a hearing to determine whether to order mediation.  If a mediation is ordered by the court, the costs of the mediation must be divided equally between the Subdivision Association and the delinquent Homeowner, and if the parties cannot agree upon the selection of a mediator, the court may appoint the mediator.

House Bill 3176 – Filling of Vacant Positions on the Board of Directors by Appointment 

In 2011, the Texas Legislature enacted Section 209.00593 of the Texas Property Code, which restricted a Subdivision Association’s Board of Directors from appointing a person to fill a vacancy on the Board unless the vacancy was caused by a resignation, death, or disability.  The 2013 Texas Legislature amended Section 209.00593 so as to authorize the Board of Directors to now appoint a person to fill a mid-term vacancy on the Board caused by any reason.

Senate Bill 198 - Protection of Drought-Resistant Landscaping and Water-Conserving Natural Turf

SB 198 modifies Section 202.007 of the Texas Property Code.  Section 202.007 restricts HOAs from enforcing a provision of a Dedicatory Instrument that would prohibit or restrict a Homeowner from using drought-resistant landscaping or water-conserving natural turf on his or her property.  A HOA may still require a Homeowner to obtain pre-approval of such landscaping or turf from the HOA to ensure, to the extent practicable, maximum aesthetic compatibility of such landscaping or turf with other landscaping in the subdivision, but a HOA’s approval may not be unreasonably denied or withheld.

House Bills 2075 and 3800 – Rerecording of Management Certificates

HB 2075 and 3800 require all Texas County Clerks to now index management certificates recorded by Subdivision and Condominium Associations as either a “Property Owners’ Association Management Certificate” or a “Condominium Association Management Certificate.”  In order to ensure that all management certificates are recorded and indexed appropriately following the effective date of HB 2075 and HB 3800, all Subdivision and Condominium Associations are required to record a new management certificate with the local County Clerk sometime between September 1, 2013, and January 1, 2014.


Source: by Gregory S. Cagle,   http://www.texashoalaw.com/2013-legislative-update/

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Tips on Attracting HOA Volunteers

1/30/2014

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Rosebrook Homeowners Association, Whitehouse, Texas, whitehouse real estate, moving to whitehouse texas, Rosebrook Circle, Rosebrook Circle Whitehouse Texas

In today’s busy world of two-career families, taking care of personal obligations and children can be challenging.  So, where does a Homeowner Association Board find volunteers?  Furthermore, how do you compete with school requests, sports, and all the other volunteer work that consumes the time of many people?

The most successful non-profit groups learn how to develop and maintain volunteers. They leverage the internet and social networking sites to help them provide training, communicate volunteer opportunities and other information. Finding volunteers is about reaching out and creating a solid foundation.  When you ask active volunteers why they got involved with a group, the most common answer is “because someone asked”.

Here are a few tips on attracting and maintaining volunteers for your community:

-You’re competing with other organizations for time, so give your homeowners a good reason to volunteer…a good reason to rally the forces. Gather ideas and input from residents, and then define your volunteer opportunities around what is important to the residents.

- Remember to ask people personally to volunteer. You won’t get much of a response by posting online or including opportunities in a newsletter. Volunteering is emotionally driven, so appeal to emotions by contacting each potential volunteer in person.

- Develop a tagline to remind people of volunteer opportunities, and include the statement in every communication.  Examples are “Where Neighbors Take Action” or “Neighbors Working Together”.  While this won’t bring a lot of volunteers, it will consistently remind homeowners of the volunteer need in the community.

- Part of the reason that people avoid volunteering is that they aren’t sure how to perform the task.  Providing ongoing training for volunteers doesn’t have to be expensive.  Add resources to your website. Ask an expert in the community to talk to the group. Sign up for online books and seminars at places like Community Association Institute.

- Appreciate and reward your volunteers. Bring in food while they are working. Thank them and give the small tokens of appreciation.

- Feature volunteer stories on your blog, website or social media page. Add pictures to bring it to life. This helps you get to know a volunteer personally in addition to showing appreciation.  Highlighting special stories also helps communicate the “volunteer spirit” of the community to all the residents.

Recruiting volunteers takes a bit of art, planning, and charm. The next time your HOA needs volunteers, step back and plan your course of action. Finally, always remember that the most important step in finding volunteers – “ASK”!!!


Source: http://wisepropertysolutions.com/tips-on-attracting-hoa-volunteers/

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Strategic HOA Planning in 5 Steps

1/12/2014

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Rosebrook Homeowners Association, Whitehouse, Texas, whitehouse real estate, moving to whitehouse texas, Rosebrook Circle, Rosebrook Circle Whitehouse Texas
Strategic planning sounds like a daunting task, but it’s just a formal process for setting objectives and goals for your community and then mapping out a plan to accomplish your objectives.  When you develop a strategic plan, you think through the coming years instead of just the current year or a few months.  It’s more than a budget or a reserve study—it’s a plan that can help your HOA Board accomplish your long-term objectives.  Follow these five steps to get started, and you’ll see that strategic planning is Business 101 basics applied to your homeowner association.

  1. Assess the big picture. Where does the Board see the association in 5 years? Include areas such as financial, common areas, reserve funds, new design, landscaping, etc. The big picture is about clarity: everyone on the Board knows where the association is going, and actions are aligned with the association goals. Strategic planning aligns your Board, owners and vendors through common goals and objectives.
  2. Evaluate where your association is currently. What’s important to the owners? What is your financial situation? Reserve fund?  Pending laws? Evaluating where you are vs. where you are heading helps you fine-tune objectives and identify risks.
  3. Create an action plan based on risks and attainable goals. Objectives are at the top level, and your plan of action is the strategy.  A strategic plan is more detailed in the near term and is less thorough for future years.  The secret is looking beyond the current year so that you can support the long-term goals of the association.
  4. Decide who is accountable for each strategic plan area. Think of your strategic plan as a map. A driver follows a map to get from one location to another. Likewise, you need a driver to get you from Point A to Point B in your strategic plan. Objectives, action plans and budgets are all part of the process, but you need drivers to oversee the different areas of the plan.
  5. Review and adapt your strategic plan.  Recognize that many external factors affect an association.  You can’t predict changing laws, economic issues or other things that influence your association.  With regularly scheduled strategic plan reviews, you can adapt your plan as necessary.
Strategic planning is never complete; it’s a work-in-progress that keeps you on track to achieve your goals. If your homeowner association doesn’t have a strategic plan, take the time to develop one so your Board can keep an eye on the future of the community.


Source: http://wisepropertysolutions.com/strategic-hoa-planning-5-steps/

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Homeowner Rights & Responsibilities

1/11/2014

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Rosebrook HOA Blog
As a homeowner in our association, you have certain rights and responsibilities.
 
You have the right to . . .
  • A responsive and competent community association.
  • Honest, fair, and respectful treatment by community leaders and managers.
  • Attend meetings, serve on committees, and run for election.
  • Access appropriate association records.
  • Prudent financial management of fees and other assessments.
  • Live in a community where the property is maintained according to established standards.
  • Fair treatment regarding financial and other association obligations, including the opportunity to discuss payment plans and options before the association takes any legal action, and the right to appeal decisions.
  • Receive all rules and regulations governing the community association —if not prior to purchase and settlement, then upon joining the community.
You also have the responsibility to . . .
  • Treat property according to established standards.
  • Treat association leaders with honesty and respect.
  • Read and comply with rules and regulations of the community and ensure that your guest(s) do too.
  • Vote in community elections and on other issues.
  • Pay association assessments and charges on time.
  • Contact association leaders or managers, if necessary, to discuss financial obligations and alternative payment arrangements.Request reconsideration of material decisions that personally affect you.
  • Provide your current contact information to the association so you receive all information from the community in a timely manner.

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Homeowner Association Fundamentals

1/11/2014

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Rosebrook Homeowners Association, Whitehouse, Texas, whitehouse real estate, moving to whitehouse texas, Rosebrook Circle, Rosebrook Circle Whitehouse Texas
Even though we live in a homeowners association (HOA), it may be surprising to find how many of our neighbors may not really understand the fundamental nature of common-interest communities. Herein you will find basic framework and fundamentals to help understand the importance and privilege of living within a HOA.
 
Community Associations Institute (CAI), a national membership organization that represents the best interests of common-interest communities like ours, developed 10 basic principles that answer three essential questions: What is the basic function of a community association? What are the essential obligations and expectations of homeowners? What are the core principles that should guide association leaders?
 
We believe that these principles are extremely important to successful living in a condominium neighborhood:
 
1. Associations ensure that the collective rights and interests of homeowners are respected and preserved.
 
2. Associations are the most local form of representative democracy, with leaders elected by their neighbors to govern in the best interest of all residents.
 
3. Associations provide services and amenities to residents, protect property values and meet the established expectations of homeowners.
 
4. Associations succeed when they cultivate a true sense of community, active homeowner involvement and a culture of building consensus.
 
5. Association homeowners have the right to elect their community leaders and to use the democratic process to determine the policies that will protect their investments.
 
6. Association homeowners choose where to live and accept a contractual responsibility to abide by established policies and meet their financial obligations to the association.
 
7. Association leaders protect the community’s financial health by using established management practices and sound business principles.
 
8. Association leaders have a legal and ethical obligation to adhere to the association’s governing documents and abide by all applicable laws.
 
9. Association leaders seek an effective balance between the preferences of individual residents and the collective rights of homeowners.
 
10. Association leaders and residents should be reasonable, flexible and open to the possibility — and benefits — of compromise.
 
For more information about Community Associations Institute, go to www.caionline.org .

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