Bringing CC&Rs current and "wise"

The existing CC&Rs were written in 1983. Our committee is to examine and recommend changes. It takes the vote of the Declarant AND 50% of lot/home owners to make a change. The Declarant has made it clear that the standards should not be lessened or liberalized (and his vote is absolute rule) but only updated. We want to be sure we are legal. Arizona law would govern us. We know that we need to address real estate signage, home business, and solar issues but do not know what else. We are an ungated association of 76 lots (each lot owner gets one vote so if one owns three lots , one has 3 votes. Each lot is approximately one acre.

I have looked for a pattern CC&R that reflects 2011 law that would serve as a good reference resource but cannot find one. We do have access to other CC&Rs, both gated and ungated, I just worry that they were as lacking in knowledge as we are.

Can you help?

Hi Hale:

The association has been in place for over 20 years and you still have a declarant? What do your documents state regarding period of declarant control? Also, how many units/lots does the declarant still own?

If you are still under declarant control, then I would potentially recommend not amending at this time. The current state statutes will generally supersede the CCR’s; therefore, as long as the statutes are followed along with your governing documents then you should potentially be OK … unless there has been any big issues regarding something within your HOA which is not covered by any of the documents. Many HOA's will amend after declarant control to eliminate items regarding said declarant and then also update to better follow statutes.

Unless you have some large issues to be addressed it may not be worth the potential expense if you have an attorney review and any filing costs to amend the documents.

Something to consider and think about ...

The Declarant situation is unusual but legal and the HOA can't change that. He has 11 lots out of 96..

There are three governing documents: the bylaws which we can't change, the CC&Rs and the town code. Then we have the Architectural Control Committee .l The primary reason for changing the CC&Rs is to provide clarity. As you know, the economic downturn has affected many Arizonians and we have had many home sales and that means many new owners. And we will have more. Some issues have come up with misunderstanding of what the CC&Rs say and what the Committee is enforcing. It seems wise to look at the language and update it to reflect the true situation. We don't plan on changing much. For instance, what should the CC&Rs say about solar or signage? Are there other issues you recommend we address?

I checked county records and explored a little and he really controls 11 lots under a corporation that owns his nine plus two others of his family. So he owns 10%, yes. He is not a board member. In fact, he is pretty hands off 99% of the time.

Hi Hale:

Your initial post had me concerned after the 20 year period of time and when you said the declarant stated “his vote is absolute rule”. As the period of declarant control has expired he potentially should have a vote per lot same as all other homeowners. The only other items where you cannot potentially eliminate would be anything pertaining to “development rights”, unless that time period has expired within your documents. For example in my HOA the declarant has certain development rights for a period of 20 years, even after declarant control has expired prior to that time frame.

Hi Hale:

Here is the AZ State Statutes section regarding property and which would in essence govern your Declaration of CCR’s:
http://www.azleg.gov/ArizonaRevisedStatutes.asp?Title=33

You would then review potentially:
Chapter 16 – Pertaining to Planned Communities
Chapter 18 – Homeowner Association Dwelling Actions

These will designate to some extent what should or should not be included in your CCR’s. However, all associations are different in what they provide for the members. The items in the state statutes are certain basic items that all associations must abide by whether they are contained in their governing documents or not.

The state statutes will mostly hit upon certain items such as display of American flag, solar energy items allowed, xeriscape landscaping, etc. Also on some items such as certain architectural guidelines, fencing, landscaping, etc., you will need to insure your documents do not violate any of your local city or county ordinances. In essence all HOA documents must abide by or exceed their state statutes, county ordinances, and local city government ordinances.

Depending on how your association is set up with regards to corporation/company status the following could potentially govern this area of your association if you are set up as a Non-Profit Association:

http://www.azleg.gov/ArizonaRevisedStatutes.asp?Title=10