SB 865

This bill creates requirements for and restrictions on the authority of certain

homeowners' associations.

Applicability

The bill applies to a homeowners' association only if all of the following apply:

1. The homeowners' association is an entity that is created to manage or

regulate, or to enforce covenants and restrictions for, real estate that includes at least

one residential lot (residential planned community).

2. The residential planned community is described in covenants and

restrictions that a) provide for such management, regulation, or enforcement by the

homeowners' association; and b) provide for restrictions on or requirements for

residential lots that run with the land, such as restrictions or requirements

regarding allowable structures; building setbacks; architectural standards; fence

restrictions; or the use, occupancy, appearance, or maintenance of property.

3. Substantially all of the members, stockholders, or other owners of the

homeowners' association are owners of residential lots that are part of the residential

planned community.

Public access to covenants and restrictions

The bill specifies that the covenants and restrictions for a residential planned

community that has a homeowners' association must be recorded with the register

of deeds in every county in which the residential planned community is located. The

bill also provides that, if the homeowners' association for a residential planned

community maintains an Internet site on which information related to the

residential planned community is available to the public, the homeowners'

association must post the covenants and restrictions on that Internet site.

Public information regarding homeowners' associations

The bill requires a homeowners' association to give public notice of certain

information, including the name and contact information for an individual who is

authorized to provide information on behalf of the homeowners' association, by filing

with the Department of Financial Institutions a notice containing the information.

The bill requires each homeowners' association to annually file a renewal notice with

DFI and, if any information contained in a notice changes, to file an amended notice

with DFI within 30 days to update the information.

The bill requires DFI to establish and maintain a statewide searchable filing

system for these notices. DFI may establish a fee not exceeding $25 for filing a notice,

but the public must be allowed to search the system's database of filings without

charge. DFI must also prescribe a form for filing notices with DFI.

The bill provides that, if a homeowners' association fails to file a required

notice, the homeowners' association may not, during the period of noncompliance,

charge any late fees or other fines for unpaid assessments owed by residential lot

owners or charge any fees in connection with transfers of ownership of residential