Session Ends – HOA Bill Signed

The 51st, 1st Regular Legislative Session adjourned Sine Die in the early morning hours of Friday, June 14. Session ran a total of 151 days. 1,158 bills were introduced this year. Of those bills 282 were passed by the legislature. To date, Governor Jan Brewer has signed 254 bills, vetoed 24 bills and 4 bills still require action. The governor has 10 days from Sine Die to either sign a piece of legislation, let the bill go into law without her signature or veto the bill. All legislation, unless it contains a delayed effective date or emergency enactment clause, becomes effective 90 days after the legislature adjourns Sine Die.

A major victory for the Arizona Association of REALTORS® (AAR) was achieved on June 20, 2013, when the governor signed SB 1454 into law. As some will recall, attempts last legislative session to establish protections for homeowners and tenants against continued abuses by homeowners associations (HOAs) fell short of the finish line when Governor Brewer vetoed HB 2513. With the veto, HOAs were left with no restrictions on what documents they could require of a tenant and no limit on what could be charged for collection of these documents.

AAR continued to hear from our membership and members of the public on the escalating efforts by HOAs to interfere in private contracts and profit off these efforts. Some community associations were seeking to obtain inappropriate information from new tenants, such as a copy of the tenant’s rental application, credit report, lease agreement, and social security number. To make matters worse, these associations were charging the tenants unreasonable amounts of money to process this information. As a result, the association actively pursued the establishment of restrictions on the information that can be requested and the amount that can be charged.

Pursuant to SB1454, community associations will now be limited as to what information they can seek to obtain from tenants. Additionally, the association will be precluded from charging more than $25 to process this documentation.

After many attempts to get this legislation to the finish line, Governor Brewer’s signature solidified the multi-year effort to establish protections for homeowners and tenants. SB 1454 contained a general effective date and will take effect on September 13, 2013. Many thanks go out to all the stakeholders, legislators and the governor for their support of this crucial legislation in the continued protection of private property rights.

The HOA provisions contained within the bill are as follows:

• A unit or property owner may rent their property, unless prohibited in the declaration.
• A unit or property owner, through a written designation, may authorize a third party to act as their agent with respect to all HOA matters regarding the rental property.
• HOAs are prohibited from requiring an owner or designated agent to disclose any information regarding the tenant other than; the name and contact information for any adults occupying the unit or property, time period of the lease including the beginning and ending dates of the tenancy, a description and license plate number of the tenant’s vehicles; and, a government issued identification that bears a photograph and date of birth if the unit or property is in an age restricted community.
• HOAs are permitted to charge no more than $25 as an administrative fee for each new tenancy, but not for the renewal of an existing lease.
• HOAs are prohibited from assessing or levying any other fee or fine or otherwise impose a requirement on a rental property that is different than on an owner-occupied unit or property in the association.
• HOAs are prohibited from requiring a copy of a rental application, credit report, lease agreement, rental contract or any other personal information.
• HOAs are prohibited from requiring a tenant to sign a waiver or other document limiting their civil rights to due process as a condition of occupancy of a rental property.
• Grants authority to an HOA to impose a $15 fee for incomplete or late information.
• Determines any attempt by an HOA to impose a fee, penalty, assessment or other charge not authorized by statute to void the fee authorized by statute and the requirement to provide information.
• Allows an HOA to acquire a credit report on a person in an attempt to collect a debt.

— NICOLE LASLAVIC, AAR Vice President of Government Affairs

Contact Legislative and Political Affairs

Arizona Association of REALTORS®

255 E. Osborn Rd., Ste. 200 • Phoenix, Arizona 85012

www.aaronline.com

Telephone: (602) 248-7787 • Fax: (602) 351-2471

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