When should an association update HOA governing documents? This is a common question board members ask. Failure to update these documents when needed can result in a range of consequences, including outdated or noncompliant provisions. It can cause confusion among homeowners in the community.
Reasons to Update HOA Governing Documents
Every HOA community adheres to a set of governing documents. These documents establish the HOA as an entity, outline the association’s operational procedures, and define the powers and obligations of both the HOA and its members. But these provisions don’t say the same forever. Circumstances may require them to be amended.
Here are the typical reasons why an association would need to update HOA governing documents.
1. To Comply With Legal Requirements
Federal, state, and local laws take precedence over all other laws, even the governing documents. When these laws change, board members should amend their documents to reflect and comply with the change. In doing so, the association can remain in the clear and avoid legal challenges.
2. To Address New Technology
Many existing governing documents still contain provisions that are outdated. Some might rely on old technology, while others have yet to adapt to new ones. As technology evolves, so should the governing documents.
Electric vehicle chargers, solar panels, and satellite dishes — these were all once unheard of. Older communities, in particular, may lack provisions regulating these items. To address modern needs, associations should amend their CC&Rs and bylaws.
3. To Match the Evolving Community
Communities don’t remain stagnant. People move in and out all the time, while the evolving times can affect how lifestyles change. To align with changing demographics and expectations, associations must update their governing documents. These updates must reflect the community as it is now, not as it was initially built.
4. To Support Operational Efficiency
There is always room for improvement in operational procedures. Associations should consider amending their governing documents to streamline voting processes, communication, management practices, and decision-making. All of these can support better governance and keep the community running at optimal capacity.
5. To Resolve Conflicts
Board members may notice a pattern emerging in which rules are the most frequent source of complaints or disputes among residents. To minimize these problems, the board should update its governing documents to clarify or reinforce these rules.
6. To Clarify Ambiguous Language
Rules are usually enacted with good intentions, but a lack of time or legal expertise can lead to ambiguity. Board members should revise their governing documents to remove vague language or clarify confusing provisions. There may be some information missing as well, and amending the documents to add supporting clauses can make rules easier to understand and enforce.
7. To Remove Offensive or Outdated Content
Many governing documents are outdated, so they might contain provisions that better reflect the past. They might still contain discriminatory clauses or obsolete restrictions that are either legally unenforceable or no longer apply. Removing these will help the association remain compliant, fair, and efficient.
8. To Promote Community Standards
Updating HOA governing documents can also help preserve property values. For example, an HOA might notice that more homeowners are allowing their exterior paint to peel, which can be an eyesore and negatively impact curb appeal. To address this, the board can revise its governing documents to promote aesthetics and community standards.
How to Update HOA Governing Documents
It’s one thing to understand why an association should amend its governing documents, but actually doing it is an entirely different ballgame. Board members often find themselves at a loss, leading to incorrect processes and invalidating the change.
Here are the steps to updating the governing documents.
1. Identify the Need
First, the board must identify the need to revise its governing documents. While the board can do this itself, it can also form a separate committee to handle the task. This committee will review the current documents and pinpoint which clauses require changing.
2. Draft the Amendment
The next step is to type out the proposed changes using underlines for additions and strikethroughs for deletions. It is important to ensure that the draft clearly explains the reason behind the change as well. To ensure clarity and compliance with the law, it is best to consult a lawyer for this step.
3. Notify Homeowners
The HOA board must notify all homeowners of the proposed change. This will give them a chance to review the change and time to reflect on their vote. Make sure to mail the proposed amendments along with a proxy form and details of the meeting.
4. Vote on the Amendment
On the day of the meeting, voting will take place. The vote can occur in person, virtually, or by mail-in ballot, whichever the governing documents currently allow.
Keep in mind that not all amendments will require a vote. Amendments to the CC&Rs or declaration typically do, as per state laws. In Texas, Section 209.0041 requires approval by 67 percent of the total votes cast by homeowners who are entitled to vote. The declaration may require a lower percentage, in which case, the declaration controls.
Moreover, the bylaws themselves should detail the voting percentage required to pass an amendment. As for operating rules, the board usually only needs a board vote and resolution. Rule amendments don’t demand a vote from the membership, but the board must still keep homeowners informed.
5. Record the Amendment
If the amendment passes, it is time to file it with the proper governing authority. For changes to the CC&Rs and bylaws, the board must typically file them with the county recorder. For changes to the Articles of Incorporation, the board must file them with the Secretary of State. Recordation makes the amendment official and binding.
6. Adopt, Distribute, and Update Records
The final step is to adopt the amendment and distribute it to all homeowners. This way, homeowners know what changes have been made, and they can adjust accordingly. Board members must also update their own internal records to reflect the new version, including any copies on community websites or online portals.
How Often to Update HOA Governing Documents
Associations should update their governing documents when necessary. That said, it is best to review the documents every year to see if anything needs to be changed. This ensures the board doesn’t miss any outdated clauses or conflicting provisions. Of course, it is best to consult a lawyer each time.
A Helping Hand
Board members must know when and how to update HOA governing documents. This is a critical part of their job and can make a world of difference in ensuring smooth operations. It’s not always easy, so hiring professional help is often the best course of action.
Graham Management offers exceptional HOA management services to Houston communities. Call us today at (713) 334-8000, request a proposal, or contact us online to learn more!
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