Hinojosa’s bill handing HOA boards to residents sooner

The text as introduced · 1,041 words

89R11319 RAL-F

By: Hinojosa of Hidalgo
S.B. No. 1935

A BILL TO BE ENTITLED

AN ACT

relating to the composition and operation of a property owners'

association board.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 209.0051(c-1), Property Code, is amended

to read as follows:

(c-1) Except for a meeting held by electronic or telephonic

means under Subsection (c-2), a board meeting must be held :

(1) in a county in which all or part of the property in

the subdivision is located or in a county adjacent to that county ;

and

(2) within 10 miles of the subdivision, if a majority

of the board members are not elected by owners other than the

declarant .

SECTION 2. Section 209.00591, Property Code, is amended by

amending Subsection (c) and adding Subsections (d), (e), and (f) to

read as follows:

(c) The declaration may provide for a period of declarant

control of the association during which a declarant, or persons

designated by the declarant, may appoint and remove board members

and the officers of the association, other than board members or

officers elected by members of the property owners' association.

(d) Regardless of the period of declarant control provided

by the declaration :

(1) on or before the 120th day after the date a

majority of the lots that may be created and made subject to the

declaration are conveyed to owners other than a declarant or a

builder in the business of constructing homes who purchased the

lots from the declarant for the purpose of selling completed homes

built on the lots, at least one-third of the board members must be

elected by owners other than the declarant; and

(2) [ , ] on or before the 120th day after the date 75

percent of the lots that may be created and made subject to the

declaration are conveyed to owners other than a declarant or a

builder in the business of constructing homes who purchased the

lots from the declarant for the purpose of selling completed homes

built on the lots, at least a majority [ one-third ] of the board

members must be elected by owners other than the declarant.

(e) If the declaration does not include the number of lots

that may be created and made subject to the declaration, at least a

majority [ one-third ] of the board members must be elected by owners

other than the declarant not later than the 10th anniversary of the

date the declaration was recorded.

(f) Not later than the 30th day after the date a majority of

the lots that may be created and made subject to the declaration are

conveyed as described by Subsection(d)(1), the declarant shall give

notice to the owners that at least one-third of the board members

must be elected by owners other than the declarant. Notice required

under this subsection must be provided by:

(1) posting the notice on any Internet website

available to association members that is maintained by the

association or by a management company on behalf of the

association; and

(2) sending the notice by e-mail to each owner who has

registered an e-mail address with the association.

SECTION 3. Section 209.0061, Property Code, is amended by

adding Subsection (e) to read as follows:

(e) The amount of a fine assessed by the property owners'

association must be reasonable in the context of the nature and

frequency of the violation and the effect of the violation on the

subdivision as a whole. If the association allows fines for a

continuing violation to accumulate against a lot or an owner, the

association must establish a reasonable maximum fine amount for a

continuing violation at which point the total fine amount is

capped.

SECTION 4. Chapter 209, Property Code, is amended by adding

Section 209.018 to read as follows:

Sec. 209.018. RESTRICTION ON INCREASE OF REGULAR

ASSESSMENT. Notwithstanding a provision in a dedicatory

instrument, a property owners' association may not increase the

amount of a regular assessment by an amount greater than or equal to

five percent per year unless the increase is approved by an

affirmative vote of at least a majority of the total votes allocated

to property owners entitled to vote on the proposed increase.

SECTION 5. (a) Section 209.00591, Property Code, as

amended by this Act, applies to a property owners' association

board regardless of whether the association's declaration was

adopted before, on, or after the effective date of this Act.

(b) Notwithstanding Section 209.00591, Property Code, as

amended by this Act, at least one-third of the board members of a

property owners' association to which Chapter 209, Property Code,

applies must be elected by owners other than the declarant on or

before March 1, 2026, if the association reached the majority

conveyance threshold described by Section 209.00591(d)(1),

Property Code, as added by this Act, before the effective date of

this Act.

(c) Notwithstanding Section 209.00591, Property Code, as

amended by this Act, at least a majority of the board members of a

property owners' association to which Chapter 209, Property Code,

applies must be elected by owners other than the declarant on or

before March 1, 2026, if:

(1) the association reached the 75 percent conveyance

threshold described by Section 209.00591(d)(2), Property Code, as

added by this Act, before the effective date of this Act; or

(2) the 10th anniversary of the date the association's

declaration was recorded occurred before the effective date of this

Act or occurs on or after the effective date of this Act and before

March 1, 2026.

SECTION 6. Section 209.0061, Property Code, as amended by

this Act, applies only to a fine that becomes due on or after the

effective date of this Act. A fine that becomes due before the

effective date of this Act is governed by the law in effect

immediately before the effective date of this Act, and that law is

continued in effect for that purpose.

SECTION 7. Section 209.018, Property Code, as added by this

Act, applies only to an increase of a regular assessment proposed by

a property owners' association on or after the effective date of

this Act.

SECTION 8. This Act takes effect September 1, 2025.