HOA Laws 2024: What Are The New Legislative Changes?

Homeowners associations are subject to federal and state laws and their governing documents. While amendments to the governing documents are normally within the HOA’s control, changes in federal or state laws are generally not. As such, HOA boards must strive to keep up with legislative changes. Here, we take on some of the new HOA laws 2024 offers.

The Importance of Understanding New HOA Laws in 2024

The laws of the land govern all homeowners associations. Although not all states have statutes that specifically address these communities, many still do. Board members must do their best to stay informed of new laws affecting their association. The primary reason for this is to stay away from potential legal trouble.

When an HOA violates the law, it exposes itself to legal liability. Homeowners can sue the association, and a court may order an HOA to pay hefty damages or penalties. Similarly, an HOA board may be in trouble for failing to follow the law. It is almost impossible to comply with the law, though, if board members aren’t aware of it in the first place.

Laws are ever-changing, so it is crucial to conduct a review regularly. However, board members may not have the legal know-how to keep up with these changes. It is a good idea to consult a legal professional when in doubt.

Federal Corporate Transparency Act

Several new 2024 HOA laws exist, including the federal Corporate Transparency Act (CTA). Originally enacted under the 2021 National Defense Authorization Act, the Financial Crimes Enforcement Network of the Department of the Treasury (FinCEN) finalized its provisions last year.

Starting January 1, 2024, the CTA requires reporting companies to report information about their organizations. This includes information on its beneficial owners. If a company was formed after January 1, 2024, the report must also include its company applicants.

How does the Corporate Transparency Act apply to HOAs? The Act applies to corporations, which most HOAs are filed as under their secretary of state. As such, HOAs are considered reporting companies.

Complying with the CTA will cause associations to incur additional administrative costs. Associations must ensure that they file their reports properly and punctually, which will likely require the help of professionals. It is also imperative to use secure tools when collecting and keeping the personal information of its beneficial owners and applicants, which the report demands. This will push associations to use third-party software with strict security protocols and firewalls.

Existing HOAs can file their reports until January 1, 2025. However, HOAs established in 2024 must file their first report within 90 days of their creation. On the other hand, HOAs established in 2025 must file their first report within 30 days of their creation.

California

For HOAs in California, here are the new HOA laws in 2024.

Meetings by Teleconference

AB 648 allows board meetings to occur via teleconference with certain conditions that ensure equal participation for board members and homeowners akin to in-person meetings. Notices for board meetings via teleconference must include clear and complete instructions on how members may join in.

Member Election

AB 1458 permits associations to adjourn meetings to a date within 5 to 30 days if they fail to meet a quorum. During the adjourned meeting, the quorum requirement is the number of individuals in attendance physically, by proxy, or via secret ballots.

Electronic Ballots, Board Member Removal, and Operating Accounts

AB 309 allows the use of electronic ballots for certain activities, such as electing or removing board members and voting for delegates representing an HOA. Board members up for removal may request a meeting for discussion. Additionally, the bill changes notice requirements, permitting votes without a meeting and using voting machines. The same bill also permits withdrawal from an HOA’s operating account for certain payments.

Use of Drinking Water

AB 1572 extends an emergency regulation prohibiting drinking or potable water to maintain non-functional turf in industrial, commercial, and institutional areas. There are exceptions, such as grass, that an HOA uses for community activities, trees, and residential lawns. It is permitted to use recycled water on non-functional turf, though.

The regulation was set to expire in June 2023. However, the State Water Resource Control Board decided to extend the regulation.

Limitations on Dues Increases for Affordable Housing

AB 572 limits regular assessment increases on deed-restricted affordable housing units in homeowners associations. No increase shall exceed 5% greater than the previous assessment or the percentage change in the cost of living, with a ceiling of 10%. This applies to deed-restricted affordable housing units with associations that record their original declaration on or after January 1, 2025.

Balcony Inspections

SB 721 requires inspections for exterior elevated elements in multifamily residential buildings consisting of three or more dwelling units. The bill aims to promote safety after a tragic incident in Berkeley 2015.

Illinois

In Illinois, here are the new HOA laws 2024 has to offer.

Electric Vehicle Charging

Senate Bill 40, titled the “Electric Vehicle Charging Act,” mandates that newly built single-family or small multifamily residences with designated parking spaces must have the necessary infrastructure to accommodate at least one parking space per unit supporting electric vehicle charging. Large multifamily residential buildings must have 100% of their total parking spaces ready for EV charging.

Residents of existing homes or buildings may request the installation of the EV charging infrastructure, but they must cover the construction cost. Associations must comply with this or face a potential fine of up to $1,000.

Road Maintenance

Effective January 1, 2024, Public Act 103-0486 permits HOA boards to contract highway commissioners for road maintenance and repairs. Specifically, this applies to HOAs that constitute more than 50% of their road district or township population.

Temperature Requirements

Effective January 1, 2024, Public Act 103-0161 presents specific requirements for heating and cooling temperatures for HOAs with age restrictions (55 and older).

North Carolina

Here are the new HOA laws in 2024 that North Carolina has to offer.

Committee on HOAs

House Bill 311 forms a House Select Committee on homeowners associations. This committee consists of nine (9) members who will review planned communities and condo associations and the laws that govern them. The committee has about a year to complete its tasks, with a final report due on or before March 1, 2024.

Texas

In Texas, here are the new HOA laws in 2024.

Fines and Enforcement

House Bill 614 requires associations to detail the types of rules they have and the schedule of fines for violations. Additionally, HOAs must include information concerning hearings. Details must follow the categories below:

• Property maintenance and repair
• Individual misconduct
• Matters affecting health and safety

The bill took effect on January 1, 2024.

New Year, New Laws

There are several new HOA laws 2024 brings with it. This should be no surprise, as every year introduces new legislation and changes to existing ones. A competent HOA board understands the importance of staying in the loop. Furthermore, a good HOA board should not hesitate to seek legal counsel from a lawyer, especially when interpreting laws and ensuring compliance.

Finding the right lawyer can be challenging if you don’t know where to look. Start your search today using our online directory!

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