Dallas Legislator Takes Aim At Property Owner Association Rules

Proposed changes to the Texas' Property Code aimed at leveling the playing field between property owners and associations

AUSTIN, TX, Feb. 18, 2009 -- Sen. Royce West (D-Dallas) last week introduced a spate of bills that would reform the way property owner associations (POA) in Texas operate.

Addressing everything from bylaws to foreclosures, West's eight bills (SB 234 through 241) would tighten up laws on how associations are managed, require transparency of financial dealings, and give property owners more legal standing to challenge association actions they feel are unfair.

All associations formed after Jan. 1, 2010 would be required to follow the new laws. Some of the changes would affect existing associations, but not all of them would be retroactive.

Some highlights of the proposed legislation follow:


SB 234
* Would allow the winner of a lawsuit involving breaches of deed restrictions to recover attorney fees. Current law restricts that privilege to the party brought the suit, that party usually being the POA.

* Would require property buyers receive notification that the property is subject to association dues and assessments and a resale certificate issued by the association.

* Would require POA's issue resale certificates detailing dues or assessments owed on the property, as well as financial and liability information on the association.

SB 235
* Would disallow a POA claiming the right of first refusal on the sale of property.

SB 236
* Would limits a POA's ability to prohibit a property owner from installing a solar energy device.

SB 237
* Would require 67% of the total allocated votes in an association to change deed restrictions. The ballots of those votes would have to be tabulated by a neutral third party, and the ballots would be filed with the county clerk. Those ballots would be available for public inspection, and retained by the county for four years.

* Would disallow any provision disqualifying a property owner from voting in an election of POA board members or matters concerning the rights or responsibilities of the owner.

* Would disallow any provisions disqualifying a property owner right to run for a position on the board of the POA, unless that owner had been convicted of an offense involving moral turpitude.

* Would require polling places where POA members vote be open from 7 a.m. to 7 p.m.

* Would require POA bylaws be specific as to the makeup and powers of the board, how board members are elected, removed or appointed, as well as how association members are notified of meetings.

SB 238
* Would require POA's make the books and financial records of the association reasonably available to an owner.

* Would provide for court-ordered fines against POA's that did not comply.

SB 239
* Would require that enforcement notices sent by a POA to a property owner describe the violation and state any amount due the association from the owner.

* Would require POA's give property owners a reasonable period to cure the violation and avoid the fine or suspension, and give a certain date by which corrections must be made.

* Would require that notices sent by a POA inform the property owner that he or she may request a hearing regarding the issue within 30 days.

SB 240
* Would require that fines assessed by the POA be reasonable, and that a cap be placed on accumulated fines.

* Would allow POA's to assess fines fines against lot occupants or renters.

* Would require POA's adopt payment schedules by which an owner may make partial payments for delinquent dues.

SB 241
* Would require a court order before the association could foreclose on a property.

The bills can be found in their entirety at
http://www.legis.state.tx.us/Reports/Report.aspx?ID=author&LegSess=81R&code=A1625