Do you live in an HOA and want your neighborhood to be gated? What about short term rentals – do you want to expand their use or stop them in your neighborhood? What about more (or less board members) serving on the board for your HOA?
Before any of these significant changes can be made, HOA documents must usually be amended. Amending CC&R’s (a/k/a Covenants, Conditions, and Restrictions) and HOA bylaws is a time-consuming and often financially demanding process. How does the amendment process typically work?
1. A Proposal to Amend is Submitted to the Board for Review
Anyone seeking an amendment to HOA documents, including CC&Rs or bylaws, must first submit the proposed changes to the Board for review. The Board will then discuss the proposed amendment at a board meeting. During this meeting, the Board must allow homeowners to voice their concerns or support for the amendment. In some situations, the Board may conduct a special meeting to discuss the proposal.
Following the Board discussions, homeowners will then have an opportunity to vote for or against the proposed amendment. If there are problems with voter turnout, the Board may extend the voting period in some circumstances. Importantly, if a homeowner believes that the amendment to CC&Rs or bylaws is illegal or not permitted by the HOA’s existing documents, that homeowner usually must attempt to stop the vote before the vote occurs.
3. Tabulating Votes
The next step is counting the ballots. This should be done in an open meeting. Doing so ensures transparency. HOAs typically require a majority vote from the homeowners to approve an amendment. What constitutes a majority will depend on the language in your governing documents. Usually, this is two-thirds or three-fourths of the homeowners to approve the amendment.
4. Recording the Changes
Once approved, amendments to CC&Rs must be recorded with the County Recorder’s Office. Amendments to bylaws do not need to be recorded. Amended bylaws become effective when notice of the changes are provided to homeowners.
Typically, the documents that govern an HOA are established when the community is being developed. These documents are not written in stone and can be amended if neighborhood or community situations change. If your HOA is not following the correct guidelines to amend the governing documents, it may be a good time to review the documents and discuss them with a real estate attorney. Feel free to email me at email@example.com if you would like a sample set of CC&Rs, amendments, bylaws, or ballots or anything else HOA related.
Patrick R. MacQueen is a founder of MacQueen & Gottlieb, PLC. For questions about keeping your real estate entity in compliance with various laws, feel free to send him an email at firstname.lastname@example.org.