Texas POA Law: The Cliff Notes Version
The Texas POA industry is full of knowledgeable groups of professionals, including community managers, board members and others who need a working knowledge of the laws governing the industry. This can be a daunting task for many first coming into the industry as to where to begin. Therefore, we have compiled the following list of terms and laws for a cliff notes version of Texas POA Law to help you kickstart your path to growth in the POA industry.
Texas Property Code Chapters
Chapter 81 – Set of laws governing condominium associations formed before January 1, 1994.
Chapter 82 – Also known as the Texas Uniform Condominium Act (TUCA), set of laws governing condominium associations whose Declaration was recorded on or after January 1, 1994. Some Chapter 82 laws apply to Chapter 81 condominiums.
Chapter 209 – Set of laws governing a residential subdivision that is subject to restrictions or provisions in a declaration that authorize the property owners’ association to collect regular or special assessments on all or a majority of the property in the subdivision.
Chapter 202 – Set of laws that apply to condominiums, single-family and townhome associations.
Chapter 204 – Only applies to a couple of associations located in certain counties referenced in Sec. 204.002 of the Property Code.
Chapter 207 – Set of laws relating to disclosure of information by POAs.
Specific Statutes in Texas POA Law to Remember
Condominiums
Sec. 82.067 Amendment of Declaration – Details procedure for amending Declaration. Specifies Declaration can only be amended by a vote that includes at least 67 percent of the current allocated votes, or any larger majority specified in the Declaration. Sec. 82.102 Powers of Unit Owners’ Association – All-encompassing law giving the Board the power to act and conduct business on behalf of the association, which includes adopting and amending bylaws, adopting and amending regulations, collecting assessments, entering contracts and more.
Sec. 82.108 Meetings – Outlines the who, what, when, where, why and how for condominium board meetings and also what voting issues the board is not allowed to take action on via unanimous written consent without holding a meeting.
82.111 Insurance – This section explains the minimum insurance requirements the condominium association must maintain. The section also explains steps to repair damaged areas, which party covers the costs and how the association’s insurance may be applied.
82.113 Association’s Lien for Assessments – Grants the association the authority to foreclose on delinquent assessments.
82.1141 Access to Association Records – Outlines the procedures for a unit owner to make a request to view the association’s books and records, provides a timeline and procedure an association is to follow to make its books and records available following the request of a unit owner and how the association is to apply fees for reasonable costs of making the records available.
Single-Family
209.005 Association Records – Outlines the procedures for an owner to make a request to view the association’s books and records, provides a timeline and procedure an association is to follow to make its books and records available following the request of an owner and includes requirements that the association adopts a records production and copying policy, which prescribes the costs the association will charge for the compilation, production, and reproduction of information, and that associations consisting of more than 14 lots have a document retention policy, which includes dates for how long certain types of documents must be retained by the association.
209.00505 Architectural Review Authority – Applies to associations of more than 40 lots and not under declarant control. States that a member of the ACC cannot be a board member, board member’s spouse, or someone living in a board member’s home. Details the owner’s right to request a hearing regarding a denial of an ACC application on or before the 30th day after notice was mailed to the owner and the hearing is to take place on or before the 30th day after the Board receives the owner’s request.
209.0051 Open Board Meetings – Provides specific details on where and how a board meeting is to be conducted. Outlines the options for notice requirements, which includes the option to send via email at least 144 hours before the start of a regular board meeting and 72 hours before the start of a special board meeting. The section also lists the 15 items that must be discussed in the open session of a board meeting: (1) fines; (2) damage assessments; (3) initiation of foreclosure actions; (4) initiation of enforcement actions, excluding temporary restraining orders or violations involving a threat to health or safety; (5) increases in assessments; (6) levying of special assessments; (7) appeals from a denial of architectural control approval; (8) a suspension of a right of a particular owner before the owner has an opportunity to attend a board meeting to present the owner’s position, including any defense, on the issue; (9) lending or borrowing money; (10) the adoption or amendment of a dedicatory instrument; (11) the approval of an annual budget or the approval of an amendment of an annual budget; (12) the sale or purchase of real property; (13) the filling of a vacancy on the board; (14) the construction of capital improvements other than the repair, replacement, or enhancement of existing capital improvements; or (15) the election of an officer.
209.006 Notice Required Before Enforcement Action – Breakdown of notice requirements for deed restriction violations. The notice is to include description of violation, the date by which violation is to be cured and details on owner’s right to hearing. The notice must be sent before the usage of common area can be suspended. The section also includes examples of curable and uncurable violations.
209.0063 Priority of Payments – Order of how delinquent assessment payments must be applied: (1) any delinquent assessment; (2) any current assessment (3) any reasonable attorney’s fees or reasonable third party collection costs incurred by the association associated solely with assessments or any other charge that could provide the basis for foreclosure; (4) any reasonable attorney’s fees incurred by the association that are not subject to Subdivision (3); (5) any reasonable fines assessed by the association; and (6) any other reasonable amount owed to the association.
209.0064 Third Party Collections – Outlines notices to homeowners for delinquent assessments that includes each delinquent amount and total amount to make account current, options for payment plan, if required by statute or dedicatory instruments, 45-day period to cure before collection actions begin.
Terms to Remember
Dedicatory Instruments – Also known as the governing documents, the documents that lay the foundation for the community.
Plat – Framework for the community that identifies lots, setbacks, streets, common areas, easements, etc. Must be filed with the county(ies) in which the property lies.
Declaration – An instrument filed in the real property records of a county that includes restrictive covenants that are applicable to an association.
Certificate of Formation – Formerly known as the Articles of Incorporation. Creates the association and sets forth its purpose, creates and names the initial board of directors.
Bylaws – Provides framework for corporate governance and how the corporation functions. Examples include meetings, quorum, notice, election of directors, powers and duties of Board, Officer responsibilities, etc.
Architectural/Builder Guidelines – Creates parameters and requirements relating to the aesthetics of the community and places limitations on what is allowed on the lots and exterior of the homes. Examples include paint color, landscaping requirements, fence style, etc.
Rules and Regulations/ Policies – Detailed procedure for enforcement of specific restrictions, fills in the gaps and provides a more topic-focused document.
Assessment – Amount due to the association by every lot or unit owner. Provides the funds for the operation of the association, which includes common area maintenance and landscaping, insurance, vendor payments, etc.
Deed Restrictions – Set of rules that must be followed by all homeowners. Examples include parking rules, hours for trash can placement, lot maintenance, etc.
The list of laws and terms provided are just the beginning in the journey of learning all that is involved within the POA industry. This list can serve not just as a way for new community managers or board members to learn the industry; it can also serve as a valuable refresher for those with years of experience.
