Bradshaw and Jill R. Goodman
May 17, 2006
The Arizona Legislature passed three
homeowners association bills regulating charges for records, flags in
communities and vehicles parked on streets.
Passed into law by the Legislature were Senate Bill 1007 and SB 1055, as
well as House Bill 2205.
Senate Bill 1007 limits fees condominiums or homeowners associations can
charge for records, and stipulates that a meeting may be closed when
pertaining to records of the HOA that are directly related to personnel,
health or financial information.
SB 1055 requires condominiums and HOAs to permit the outdoor display of
military, POW/MIA, Arizona state and Arizona Indian nations flags.
HB 2205 allows a resident to park a vehicle on a street or driveway if
employed by a municipal utility and the vehicle is required to be
available to the resident for employment purposes.
Desert Ridge Community Association
Manager Jim Davis said he does not believe any of the passed bills will
greatly impact Desert Ridge, but he said he still must review the final
“I think all of them (bills) are just clarifying stuff that’s
already being done,” Mr. Davis said. “It (passed bills) will affect
different associations depending on their legal documents. There is no
standard boiler plat for associations.”
Desert Ridge Homeowners Network Vice Chairman Nick Meris said he agreed
with SB 1007.
“It (SB 1007) is a little more protection for homeowners and that’s
generally what we’re looking for,” Mr. Meris said.
Mr. Meris noted he also liked SB 1055 because it allows people to honor
those who have or are serving their country and recognize their
However, Mr. Meris said he favors
limiting the size of the flag.
“I would hate to see the type of flag that covers the whole house,”
Meris said. “It doesn’t make a neighborhood look too great if its
(the flag) too large.”
Mr. Meris was strongly against HB 2205 saying vehicles left out on the
street will lessen the neighborhood’s beauty.
“I wouldn’t want any type of vehicle left out there,” he said.
“Let them put it in the garage or let the city come out here and pay
to extend those people’s garages.”
A bill gaining momentum at the state capitol would provide an
alternative hearing process for disputes between homeowners and
The state Senate passed HB 2824 with amendments May 3 and now
legislators from both branches are slated to negotiate changes to the
bill that authorizes the Office of Administrative Hearings to conduct
HOA grievance hearings.
Administrative law judges could impose civil penalties for violations.
Primary bill sponsors believe this would provide a quicker, cheaper way
— other than hiring a lawyer and taking complaints to court — for
homeowners to address problems with their HOA board.
“There’s a certain threshold you
have to hit before it makes sense to defend your rights. It doesn’t
make any sense to go and spend $10,000 to save $500,” said District 22
state Rep. Eddie Farnsworth (R-Gilbert).
District 6 state Rep. Pamela Gorman (R-Anthem) helped craft the bill
over the summer hoping to address HOA reform on a statewide level
without tampering with rules homeowners agree to by moving into an
“We didn’t want people to be able to harass their HOA because they
didn’t like the contract, but if the contact is not being honored by
the board, they need a place to go,” she said. “With all the HOA
bills that were out there, I think this is the one that gave them the
least amount of heartburn in the industry.”
Opponents believe the new law would lengthen the dispute time and end up
costing associations more, which would dig into pockets of homeowners
regularly paying their dues.
Curtis Ekmark, an HOA attorney and vice president of West Valley
Homeowners Associations, fears “double litigations” with arguments
going through this hearing process and then superior court, or vice
“You still end up in Maricopa County Superior Court,” he said. “I
can’t really see why that’s good for boards or anyone who lives in
According to the bill’s text, decisions by the administrative law
judge cannot be appealed, but all parties can take conflicts —
initially or after the decision — to superior court.
The Department of Building and Fire Safety, which would oversee hearing
requests, would establish a fee based on the cost to do service.
Bill opponents also argue it does not offer enough time for many HOA
boards to respond to complaints. The bill language allotted 10 days for
a response at one point while lawmakers were discussing upping it to
“For self-managed associations or even smaller law firms, if you’re
on vacation, how do you respond in 10 days?” Mr. Ekmark said.
House Bill 2352, also alerted to its members by West Valley Homeowners
Association, would protect homeowners’ equity up to $150,000 before a
lien for unpaid HOA assessments or late fines is paid.
This Rep. Farnsworth-sponsored bill, which failed March 30 in the
Government Committee, worried HOA advocates, who believe they need
foreclosure power to collect unpaid fees and reinforce Covenants,
Conditions & Restrictions. The legislation, reincarnated as SB 1183,
The Gilbert lawmaker, who lives in an HOA, said associations deserve to
be paid money they are owed, but the penalty for walking a dog without a
leash should not be losing a home and equity, and the homestead
exemption, if applied, should be applied equally to residents whether
they live in an HOA or not.
Rep. Farnsworth’s sights are now on a hearing process as laid out in
The driving force for Rep. Gorman is the fact HOA membership is not
optional in many communities anymore.
However, Rep. Gorman argues any amendment worth making will garner
enough interest from homeowners. Many HOAs require a three-fourths vote
to amend governing documents.