Developing New HOA Rules & Regulations

Started by MarciaB4 • 9 replies • 553 views

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MarciaB4 (Illinois)
Posts: 1

Posted:

We are a new, smaller HOA ( 40 townhomes) just taking over from builder.

Only 3 ran for 3 positions on our new resident board ( including me) none with any HOA experience. We do have a property management company, who has only been moderately helpful. She told us the first thing we had to do was create the rules and regs, so we have been researching other local public r& r and adapting to ours. The board has written up a draft and we have formed a resident R&R committee( 6 additional residents) which will be meeting to discuss.

BUT.. now another resident who has HOA exp... is telling me prior to r& r we need to amend our recorded covenants first. Because they are written more from the builder/developers perspective than the HOA.

I guess I am looking for advice from others who have been involved with HOA take overs from the builders who then wrote and implemented their R&R's. What was your process? Time Frame? Thanks so much for any help!

SheliaH (Indiana)
Posts: 6,964

Posted:

Your property manager and the resident are both right - and is start with the resident's recommendation to review the documents and (1)remove references to the developer since its not around anymore and then work on rules - after you've checked the documents to see if the board has authority to establish additional rules to flesh out the Bylaws and CCRs.

Your association attorney can help guide you through the process, as you'll probably need homeowner approval to amend the documents. This would be a good time to set up an advisory committee to review the documents in detail to make recommendations. I'd ask the resident to be a member.

You should also go to the Community association institute (CAI) website and invest in some of their education materials on amending docume, rules enforcement and a bunch of other HOA issues so all board members learn best practices that can be adapted to your community. There may even be a local chapter that offers seminars where you can meet people from other HOAs and network on how they did it - and what not to do.

Of course, you can keep coming here and read old and new conversations for more enlightenment. Good luck!

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

BarbaraT1 (Texas)
Posts: 821

Posted:

You don’t need to rewrite the declaration just to remove references to the developer. Those references will say things like “while the declarant still owns lots” and other language that acknowledges its temporal state.

Amending documents typically requires a large percentage of the community to vote; it’s a huge undertaking that I wouldn’t recommend an association do just for the sake of removing some language that is meaningless anyway.

You don’t need more rules and regulations either, unless you want them or see a need for them. Are there rules you don’t have but want? Are there problems in the community that would be solved by creating rules?

DouglasK1 (Florida)
Posts: 2,046

Posted:

Amending your covenants is optional, it really depends on whether there is anything that needs to be changed. In my last association we went almost 20 years after turnover before our first amendments. Builder bylaws often allow non owners to be directors, that was the only thing we really needed to tackle in the short term after turnover.

Escaped former treasurer and director of a self managed association.

AugustinD
Posts: 3,698

Posted:

-- Regarding amending the covenants: I agree with BarbaraT1 and DouglasK1. Put the amending of the covenants on a back burner. Legally, the chances are good that the covenants are fine as they are right now. The amending process typically takes a year or so: Draft amendments; attorney reviews; provide multiple notices to owners of a vote on amendments; vote over a month or so, preferably online; if the vote is successful, record the amended covenants with the county.

-- Regarding rules and regulations: The board should review whatever is in place now and make changes as needed. All Rules and Regs must be deriv-able from the covenants and within the authority of the covenats. The process should include a review of the proposed Rules and Regs with a newly retained HOA/COA attorney.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

We looked at rewriting our docs primarily to remove any reference to the developer/declarant. The cost was not worth it. Now we juts "read through" those references.

TimB4 (Tennessee)
Posts: 21,059

Posted:

Rules and Regulations apply to common areas ONLY
Example: dogs must be on a leash when walked on common area

Architectural guidelines provide a standard on what will and won't be considered by the Association for exterior changes.
Examples: approved colors, type of screen/storm doors, etc.

Limitations to private property (individual lots) must be within the covenants.
Examples: rental restrictions, vehicles must be parked within garages, exterior changes must first be approved by the Association.

AugustinD
Posts: 3,698

Posted:

Quote:

Posted By TimB4 on 06/16/2021 9:59 AM
Rules and Regulations apply to common areas ONLY

I think this depends on what state statute and the Declaration say about the Board's rule-making authority.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

One of the great abuses of R&R's is when a BOD tries to use them to "override" Covenants and/or Bylaws. They are meant to clarify/define, not to change.

We see this abuse quite often when one wants to set rental restrictions when there were none.

KerryL1 (California)
Posts: 14,550

Posted:

We're just in the process of restating our CC&Rs --20 y.o high rise. NO need to do that now.

Agree with Augustin that Rules & Regs are not necessarily limited to common areas. It depends.... Agree they must not conflict with higher level governing documents like your CC&Rs, Articles of Incorporation and Bylaws.

An important point about rules is make as few as possible and make sure they're enforceable. Our developer made some rules & regs to accompany our CC&Rs. One rule was our 4 interior 25 story stairwells may not be used except for emergencies. This, I guess, to keep them open for EMTs. The rule was unenforceable and some folks use the stairs for exercise. We eliminated the rule.

If you want only owners on your board of directors, you may want to amend your Bylaws, as Douglas points out, if they don't contain that qualification. Usually Bylaws are easier to amend than CC&Rs.

Yes, poking around on CAI's website is a good idea!

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