Board Actions and Requirements in Texas

Question:

Can HOA townhome boards and their management company in the State of Texas be allowed to stipulate a limit or a percentage ratio of total number of investors buying into a predominantly homeowner residing community to lease/rent their unit?

Why or Why Not?

How and when, if allowed, would residential homeowners request this to be accomplished and adopted in a board meeting to limit rentals inside their community?

Please describe if and when a homeowner can motion the HOA BOARD and HOA Management company (whether regular or special) meetings going into an executive session for board vote afterwards can be withdrawn, withheld, tabled, proposed change or revision on any issue that may be unpopular? Can homeowners motion and second for further discussion or proposed suggestion for alternative consideration before board goes into executive session to vote on certain issues including appointment of new director if another director resigned before end of their term and year.

When deed restrictions dictate a quarterly regular meeting but HOA board & management do not follow protocol, how can that be rectified? What is notice period of time that must be given to each homeowner?

When do most townhomes HOAs have their annual meeting to submit budget for year? Candidates for new board term?

When a board member has deliberately not been transparent and caused TH homeowners into personal legal battles with builder, then changes course two years later, how can homeowners request their resignation and make sure the board approves that?

How can a homeowner request or motion the board have financials in the past five years audited and shown to each homeowner for examination per State of Texas Law?

Thanks,
Very concerned homeowner

PS. Buyer Beware: Be sure you know how townhomes board & management are ran before buying a townhome.

– Anthony

 

Answer:

Hi Anthony,

There is currently no law in Texas that forbids HOAs from limiting investors in the community, though most associations do this by imposing rental restrictions, which are also allowed under Texas law. If you wish to limit investors in your community, it’s a good idea to impose similar rental restrictions, such as only allowing a certain percentage of rentals in the community. If no such restriction exists in your governing documents, you may want to amend them. According to the Texas Property Code, amendments to the declaration require a member vote.

The requirements to call for a special meeting will typically be found in your governing documents. Texas law also dictates that members have a right to attend board meetings and be heard at regular member meetings. Most board resolutions only require a vote from the board members, though homeowners are free to express their input.

Texas does not have a state agency that governs or regulates homeowners associations. Thus, if your board fails to follow HOA protocol, such as holding quarterly meetings, you can check your bylaws for any remedies. Beyond that, you may need to seek help from an attorney.

As for when to hold annual meetings, it can vary from one association to another. You will find this information specific to your HOA in your bylaws or CC&Rs. The same goes for information on budget preparation, board elections, candidate qualifications, and the like.

Your bylaws also contain information on how you can remove a board member. Absent such provisions, you may turn to Section 22.211 of the Texas Business Organizations Code.

Finally, for audits, some associations are required by their governing documents to perform audits every few years. Check if this is a requirement for your HOA. Texas law currently does not require HOAs to perform audits. However, HOAs are required by the Texas Property Code to retain audit records for seven (7) years. Members can then request a copy of this record, which the HOA is required to comply with by law.

Disclaimer: We are not lawyers. The information provided on this website does not constitute legal advice.

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