HOA bill passes both the Legislature
February 28, 2015
If a bill regarding homeowner associations continues down its current path after passing both the Utah House of Representatives and the Senate, most association meetings will soon be open to all homeowners.
The bill would require that most board meetings be open to each unit or lot owner. But it would exclude committee meetings and it would allow boards to close part of a meeting for executive session to discuss private or confidential matters. The bill also states that, upon request, email notification of the meetings must be provided to owners.
Sponsored by Rep. Mike Shultz, a Republican whose district includes parts of Davis and Weber counties, HB 99 is in the final stages of approval. If Utah Gov. Gary R. Herbert signs the bill, it will go into effect on July 1.
"The Legislature liked the bill and were very interested in getting it passed," said John Morris, a HOA attorney with the Utah law firm, Morris Sperry, who helped draft the bill. "It is very similar to open meeting-type laws that apply to the Legislature and they were generally in strong support of it."
The bill has been well received, overwhelmingly passing the House, 66-6, with three members absent or not voting. It also unanimously passed the Senate 28-0, with one member absent or not voting.
"I’m 99 percent confident the governor will sign it," Morris said. "There is no reason why he wouldn’t. This is the type of bill lawmakers like because it’s about disclosure and transparency."
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This was the second time HB99 has been considered. It passed the House in 2014 toward the end of the legislative session, but never made it to the next step.
"It is a good law and I have been working on it for several years," Morris said. "It has been thoroughly discussed by all the people in the industry at this point. Everyone already knows it is best practice to open meetings to owners."
Morris said the two primary arguments against the bill were that if owners attended the meetings, it would be disruptive and prevent business from being completed.
"That doesn’t really have any merit to it because if a meeting is properly run, then that is just not the case," he said. "That argument comes from people who don’t know how to run meetings and are trying to keep them private."
The other argument against the bill is that it imposes another administrative burden on associations due to the email list requirement, which Morris said is a "legitimate" concern.
"It does impose additional burdens and that could translate to a cost," he said. "But almost universally in our industry, everyone recognizes that the benefits far outweigh the costs."
The original draft imposed more burdens on associations, Morris said.
"Bills that have been adopted in other states impose a lot more burdens," he added. "A lot of work has been done to minimize those burdens as much as possible. What it boils down to is you just have to keep an email list and include them on your notices of meetings and that’s just not that much of a burden."
Stewart Barlow, a Republican whose district includes Davis County, cast a vote against HB 99, saying it is overreaching.
"Homeowner associations are a private entity," Barlow said. "It’s not a public entity and shouldn’t be subjected to open meeting laws. In a lot of instances, it would probably in the owner’s best interest that things are kept quiet when it involves people in the community.
"I think there certainly is a problem relating to some homeowners associations, but the power is in the owners’ hands, he said. "They have the chance to bump them off the board, so I think it is overreaching."
However, homeowner associations tend to support the bill’s purpose.
Bobbie Robinson, the HOA president of Canyon Links at Jeremy Ranch Golf and Country Club, said their meetings have always been open to owners. She has served as the president since 2007.
Robinson said she thought it already was a legal requirement to open the meetings and Canyon Links has operated their meetings under that assumption.
"Whenever we have meetings, we have always opened them to the owners," she said. "We are pro-owner and we want to hear from them and know what their thoughts are. So personally, I think this is a good idea."
As of Thursday, a copy of the enrolled bill was being prepared for Gov. Herbert’s review.
To track this bill, go to http://le.utah.gov/~2015/bills/static/HB0099.html .
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