Running a homeowners association requires knowing what kind of documents you need, what they’re for, and how to properly distribute them to your residents. Your bylaws, CC&Rs, and Articles of Incorporation, among others, dictate how your community is run—and the processes that should be followed when certain restrictions are violated. Having clear and concise documentation, and communicating it properly to your community, helps you enforce rules and avoid pitfalls like angry residents or potential legal issues.
Articles of Incorporation
While this is a pretty basic document, it’s also what establishes your HOA or condo association as such. The Articles of Incorporation contain the name, location, and purpose of the property, and are filed with the secretary of state where the community or property is located. Some states allow unincorporated associations, so it’s important to know the laws in your state.
Forming your association bylaws is typically the second step. These lay out how the HOA will be run, including setting procedures for voting and rights for the residents during elections and establishing how and when board meetings should be conducted. Your bylaws may also contain the rules and regulations, which set and give the board authority to enforce certain rules, as well as collect assessments.
The bylaws also govern the HOA board. They determine the term lengths for board members and the procedures that must be followed for board elections. In some associations, the bylaws also determine how the annual budget is created and assessment amounts are set.
Covenants, Conditions and Restrictions (CC&Rs)
Your CC&Rs are the most comprehensive document in your HOA. These contain in-depth information about the association and how it’s run, as well as establishing the general structure of the development and what land is subject to the governing documents. The CC&Rs are the final say in the association’s rules—if another document contradicts it, the CC&Rs wins.
This document designates the authority and obligations of the association, as well as the rights and responsibilities of homeowners within the community. This is where you set restrictions on owners’ use of property, such as regulations on satellite dishes or holiday decorations. They are not set in stone, though. They will contain procedures for any amendments the association wishes to make.
Rules and Regulations
Your CC&Rs will contain general rules and regulations, but many HOAs will adopt a more specific Rules and Regulations document. Often the most controversial document for an association, this sets restrictions for more detailed aesthetics and procedures, such as where and how long undriveable cars can be parked on the property, how many people can be in the community pool at one time, or what type and size of pets are allowed.
Every budget created, every fee collected, and every purchase made or invoice paid in a homeowners association must be recorded and made available to owners and prospective buyers. Keeping accurate and up to date financial records is imperative for both transparency and future planning.
Every board meeting should have minutes recorded and stored for future reference. These can be referred to when creating new annual budgets or when discussing or voting on a large improvement project. They can also help solve potential disputes over previous decisions or distribution of information.
Understanding and managing all of the documentation required to run an HOA can be a full-time job. Find out more about how we can help lighten the load.