Bill Text: TX SB1168 | 2015-2016 | 84th Legislature | Enrolled
Bill Title: Relating to the operation of certain property owners' associations, condominium unit owners' associations, and councils of owners.
Spectrum: Bipartisan Bill
Status: (Passed) 2015-06-19 - Effective on 9/1/15 [SB1168 Detail]
Download: Texas-2015-SB1168-Enrolled.html
S.B. No. 1168 |
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relating to the operation of certain property owners' associations, | ||
condominium unit owners' associations, and councils of owners. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 82.157(a), Property Code, is amended to | ||
read as follows: | ||
(a) Except as provided by Subsection (c), if a unit owner | ||
other than a declarant intends to sell a unit, before executing a | ||
contract or conveying the unit, the unit owner must furnish to the | ||
purchaser a current copy of the declaration, bylaws, any | ||
association rules, and a resale certificate that must have been | ||
prepared not earlier than three months before the date it is | ||
delivered to the purchaser. The resale certificate must be issued | ||
by the association and must contain the current operating budget of | ||
the association and statements of: | ||
(1) any right of first refusal or other restraint | ||
contained in the declaration that restricts the right to transfer a | ||
unit; | ||
(2) the amount of the periodic common expense | ||
assessment and the unpaid common expenses or special assessments | ||
currently due and payable from the selling unit owner; | ||
(3) other unpaid fees or amounts payable to the | ||
association by the selling unit owner; | ||
(4) capital expenditures, if any, approved by the | ||
association for the next 12 months; | ||
(5) the amount of reserves, if any, for capital | ||
expenditures and of portions of those reserves designated by the | ||
association for a specified project; | ||
(6) any unsatisfied judgments against the | ||
association; | ||
(7) the nature of any pending suits against the | ||
association; | ||
(8) insurance coverage provided for the benefit of | ||
unit owners; | ||
(9) whether the board has knowledge that any | ||
alterations or improvements to the unit or to the limited common | ||
elements assigned to that unit violate the declaration, bylaws, or | ||
association rules; | ||
(10) whether the board has received notice from a | ||
governmental authority concerning violations of health or building | ||
codes with respect to the unit, the limited common elements | ||
assigned to that unit, or any other portion of the condominium; | ||
(11) the remaining term of any leasehold estate that | ||
affects the condominium and the provisions governing an extension | ||
or renewal of the lease; [ |
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(12) the name, mailing address, and telephone number | ||
of the association's managing agent, if any; | ||
(13) the association's current operating budget and | ||
balance sheet; and | ||
(14) all fees payable to the association or an agent of | ||
the association that are associated with the transfer of ownership, | ||
including a description of each fee, to whom the fee is paid, and | ||
the amount of the fee. | ||
SECTION 2. Section 207.001(2), Property Code, is amended to | ||
read as follows: | ||
(2) "Dedicatory instrument," "property owners' | ||
association," and "restrictive covenant" have the meanings | ||
assigned by Section 209.002 [ |
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SECTION 3. Section 207.002, Property Code, is amended to | ||
read as follows: | ||
Sec. 207.002. APPLICABILITY. (a) This chapter applies to | ||
a subdivision with a property owners' association that is entitled | ||
to levy regular or special assessments. | ||
(b) This chapter does not apply to a condominium council of | ||
owners governed by Chapter 81 or a condominium unit owners' | ||
association governed by Chapter 82. | ||
SECTION 4. Section 209.002, Property Code, is amended by | ||
amending Subdivision (4-a) and adding Subdivision (13) to read as | ||
follows: | ||
(4-a) "Development period" means a period stated in a | ||
declaration during which a declarant reserves: | ||
(A) a right to facilitate the development, | ||
construction, and marketing of the subdivision; or [ |
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(B) a right to direct the size, shape, and | ||
composition of the subdivision. | ||
(13) "Verified mail" means any method of mailing for | ||
which evidence of mailing is provided by the United States Postal | ||
Service or a common carrier. | ||
SECTION 5. Section 209.003(d), Property Code, is amended to | ||
read as follows: | ||
(d) This chapter does not apply to a condominium as defined | ||
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SECTION 6. Section 209.0041, Property Code, is amended by | ||
amending Subsection (h) and adding Subsections (h-1) and (h-2) to | ||
read as follows: | ||
(h) Except as provided by Subsection (h-1) or (h-2) [ |
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percent of the total votes allocated to property owners entitled to | ||
vote on the amendment of the declaration [ |
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law. | ||
(h-1) If the declaration contains a lower percentage than | ||
prescribed by Subsection (h), the percentage in the declaration | ||
controls. | ||
(h-2) If the declaration is silent as to voting rights for | ||
an amendment, the declaration may be amended by a vote of owners | ||
owning 67 percent of the lots subject to the declaration. | ||
SECTION 7. Chapter 209, Property Code, is amended by adding | ||
Section 209.0042 to read as follows: | ||
Sec. 209.0042. METHODS OF PROVIDING NOTICES TO OWNERS. | ||
(a) Subject to this section, a property owners' association may | ||
adopt a method that may be used by the association to provide a | ||
notice from the association to a property owner. | ||
(b) A property owners' association may use an alternative | ||
method of providing notice adopted under this section to provide a | ||
notice for which another method is prescribed by law only if the | ||
property owner to whom the notice is provided has affirmatively | ||
opted to allow the association to use the alternative method of | ||
providing notice to provide to the owner notices for which another | ||
method is prescribed by law. | ||
(c) A property owners' association may not require an owner | ||
to allow the association to use an alternative method of providing | ||
notice adopted under this section to provide to the owner any notice | ||
for which another method of providing notice is prescribed by law. | ||
SECTION 8. Section 209.0051, Property Code, is amended by | ||
amending Subsections (b), (c-1), and (h) and adding Subsection | ||
(c-2) to read as follows: | ||
(b) In this section, "board[ |
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(1) [ |
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voting board of the property owners' association, or between a | ||
quorum of the voting board and another person, during which | ||
property owners' association business is considered and the board | ||
takes formal action; and | ||
(2) [ |
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of the board at a social function unrelated to the business of the | ||
association or the attendance by a quorum of the board at a | ||
regional, state, or national convention, ceremonial event, or press | ||
conference, if formal action is not taken and any discussion of | ||
association business is incidental to the social function, | ||
convention, ceremonial event, or press conference. | ||
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(c-1) Except for a meeting held by electronic or telephonic | ||
means under Subsection (c-2) [ |
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a county in which all or part of the property in the subdivision is | ||
located or in a county adjacent to that county. | ||
(c-2) A board meeting may be held by electronic or | ||
telephonic means provided that: | ||
(1) each board member may hear and be heard by every | ||
other board member; | ||
(2) except for any portion of the meeting conducted in | ||
executive session: | ||
(A) all owners in attendance at the meeting may | ||
hear all board members; and | ||
(B) owners are allowed to listen using any | ||
electronic or telephonic communication method used or expected to | ||
be used by a board member to participate; and | ||
(3) the notice of the meeting includes instructions | ||
for owners to access any communication method required to be | ||
accessible under Subdivision (2)(B). | ||
(h) Except as provided by this subsection, a [ |
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take action outside of a meeting [ |
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means, without prior notice to owners under Subsection (e), if each | ||
board member is given a reasonable opportunity to express the board | ||
member's opinion to all other board members and to vote [ |
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taken without notice to owners under Subsection (e) must be | ||
summarized orally, including an explanation of any known actual or | ||
estimated expenditures approved at the meeting, and documented in | ||
the minutes of the next regular or special board meeting. The board | ||
may not, unless done in an open meeting for which [ |
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notice was given to owners under Subsection (e), consider or vote | ||
on: | ||
(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; [ |
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(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 that increases the budget by | ||
more than 10 percent; | ||
(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. | ||
SECTION 9. Section 209.0056, Property Code, is amended by | ||
amending Subsection (a) and adding Subsection (a-1) to read as | ||
follows: | ||
(a) For an election or vote taken at a meeting of the owners, | ||
not [ |
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before the date of the [ |
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association shall give written notice of the election or vote to: | ||
(1) each owner of property in the property owners' | ||
association, for purposes of an association-wide election or vote; | ||
or | ||
(2) each owner of property in the property owners' | ||
association entitled under the dedicatory instruments to vote in a | ||
particular representative election, for purposes of a vote that | ||
involves election of representatives of the association who are | ||
vested under the dedicatory instruments of the property owners' | ||
association with the authority to elect or appoint board members of | ||
the property owners' association. | ||
(a-1) For an election or vote of owners not taken at a | ||
meeting, the property owners' association shall give notice of the | ||
election or vote to all owners entitled to vote on any matter under | ||
consideration. The notice shall be given not later than the 20th | ||
day before the latest date on which a ballot may be submitted to be | ||
counted. | ||
SECTION 10. Section 209.0057, Property Code, is amended by | ||
amending Subsections (b), (c), and (d) and adding Subsections | ||
(b-1), (b-2), (b-3), and (b-4) to read as follows: | ||
(b) Any owner may, not later than the 15th day after the | ||
later of the date of any [ |
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election or vote was held or the date of the announcement of the | ||
results of the election or vote, require a recount of the votes. A | ||
demand for a recount must be submitted in writing either: | ||
(1) by verified [ |
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signature confirmation service to the property owners' | ||
association's mailing address as reflected on the latest management | ||
certificate filed under Section 209.004; or | ||
(2) in person to the property owners' association's | ||
managing agent as reflected on the latest management certificate | ||
filed under Section 209.004 or to the address to which absentee and | ||
proxy ballots are mailed. | ||
(b-1) The property owners' association must estimate the | ||
costs for performance of the recount by a person qualified to | ||
tabulate votes under Subsection (c) and must send an invoice for the | ||
estimated costs to the requesting owner at the owner's last known | ||
address according to association records not later than the 20th | ||
day after the date the association receives the owner's demand for | ||
the recount. | ||
(b-2) The owner demanding a recount under this section must | ||
pay the invoice described by Subsection (b-1) in full to the | ||
property owners' association on or before the 30th day after the | ||
date the invoice is sent to the owner. | ||
(b-3) If the invoice described by Subsection (b-1) is not | ||
paid by the deadline prescribed by Subsection (b-2), the owner's | ||
demand for a recount is considered withdrawn and a recount is not | ||
required. | ||
(b-4) If the estimated costs under Subsection (b-1) are | ||
lesser or greater than the actual costs, the property owners' | ||
association must send a final invoice to the owner on or before the | ||
30th business day after the date the results of the recount are | ||
provided. If the final invoice includes additional amounts owed by | ||
the owner, any additional amounts not paid to the association | ||
before the 30th business day after the date the invoice is sent to | ||
the owner may be added to the owner's account as an assessment. If | ||
the estimated costs exceed the final invoice amount, the owner is | ||
entitled to a refund. The refund shall be paid to the owner at the | ||
time the final invoice is sent under this subsection. | ||
(c) Following receipt of payment under Subsection (b-2), | ||
the [ |
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owner requesting the recount, retain for the purpose of performing | ||
the recount[ |
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under this subsection. The association shall enter into a contract | ||
for the services of a person who: | ||
(1) is not a member of the association or related to a | ||
member of the association board within the third degree by | ||
consanguinity or affinity, as determined under Chapter 573, | ||
Government Code; and | ||
(2) is: | ||
(A) a current or former: | ||
(i) county judge; | ||
(ii) county elections administrator; | ||
(iii) justice of the peace; or | ||
(iv) county voter registrar; or | ||
(B) a person agreed on by the association and | ||
each person [ |
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(d) On [ |
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recount must be completed and the property owners' association must | ||
provide each owner who requested the recount with notice of the | ||
results of the recount [ |
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changes the results of the election, the [ |
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association shall reimburse the requesting owner for the cost of | ||
the recount not later than the 30th day after the date the results | ||
of the recount are provided. [ |
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the initial election vote tally and the completion of the recount is | ||
not affected by any recount. | ||
SECTION 11. Section 209.0058, Property Code, is amended by | ||
amending Subsections (a) and (c) and adding Subsections (a-1) and | ||
(d) to read as follows: | ||
(a) Except as provided by Subsection (d), a [ |
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association must be in writing and signed by the member if the vote | ||
is cast: | ||
(1) outside of a meeting; | ||
(2) in an election to fill a position on the board; | ||
(3) on a proposed adoption or amendment of a | ||
dedicatory instrument; | ||
(4) on a proposed increase in the amount of a regular | ||
assessment or the proposed adoption of a special assessment; or | ||
(5) on the proposed removal of a board member. | ||
(a-1) If a property owners' association elects to use a | ||
ballot for a vote on a matter other than a matter described by | ||
Subsection (a), the ballot must be: | ||
(1) in writing and signed by the member; or | ||
(2) cast by secret ballot in accordance with | ||
Subsection (d). | ||
(c) In a property owners' association [ |
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election, written and signed ballots are not required for | ||
uncontested races. | ||
(d) A property owners' association may adopt rules to allow | ||
voting by secret ballot by association members. The association | ||
must take measures to reasonably ensure that: | ||
(1) a member cannot cast more votes than the member is | ||
eligible to cast in an election or vote; | ||
(2) the association counts each vote cast by a member | ||
that the member is eligible to cast; and | ||
(3) in any election for the board, each candidate may | ||
name one person to observe the counting of the ballots, provided | ||
that this does not entitle any observer to see the name of the | ||
person who cast any ballot, and that any disruptive observer may be | ||
removed. | ||
SECTION 12. Section 209.0059, Property Code, is amended by | ||
adding Subsection (c) to read as follows: | ||
(c) In a residential development with 10 or fewer lots for | ||
which the declaration was recorded before January 1, 2015, a person | ||
may not vote in a property owners' association election unless the | ||
person is subject to a dedicatory instrument governing the | ||
association through which the association exercises its authority. | ||
SECTION 13. Section 209.00591, Property Code, is amended by | ||
adding Subsection (a-1) and amending Subsection (c) to read as | ||
follows: | ||
(a-1) Notwithstanding any other provision of this chapter, | ||
a property owners' association's bylaws may require one or more | ||
board members to reside in the subdivision subject to the | ||
dedicatory instruments but may not require all board members to | ||
reside in that subdivision. A requirement described by this | ||
subsection is not applicable during the development period. | ||
(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. Regardless of the period of declarant control | ||
provided by the declaration, 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 one-third of the board members must be | ||
elected by owners other than the declarant. If the declaration | ||
does not include the number of lots that may be created and made | ||
subject to the declaration, at least 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. | ||
SECTION 14. Section 209.00592, Property Code, is amended by | ||
amending Subsection (a) and adding Subsections (a-1) and (b-1) to | ||
read as follows: | ||
(a) Subject to Subsection (a-1), the [ |
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an owner may be cast or given: | ||
(1) in person or by proxy at a meeting of the property | ||
owners' association; | ||
(2) by absentee ballot in accordance with this | ||
section; | ||
(3) by electronic ballot in accordance with this | ||
section; or | ||
(4) by any method of representative or delegated | ||
voting provided by a dedicatory instrument. | ||
(a-1) Except as provided by this subsection, unless a | ||
dedicatory instrument provides otherwise, a property owners' | ||
association is not required to provide an owner with more than one | ||
voting method. An owner must be allowed to vote by absentee ballot | ||
or proxy. | ||
(b-1) For purposes of Subsection (b), a nomination taken | ||
from the floor in a board member election is not considered an | ||
amendment to the proposal for the election. | ||
SECTION 15. Section 209.00593, Property Code, is amended by | ||
adding Subsections (a-1), (a-2), and (a-3) and amending Subsection | ||
(d) to read as follows: | ||
(a-1) At least 10 days before the date a property owners' | ||
association composed of more than 100 lots disseminates absentee | ||
ballots or other ballots to association members for purposes of | ||
voting in a board member election, the association must provide | ||
notice to the association members soliciting candidates interested | ||
in running for a position on the board. The notice must contain | ||
instructions for an eligible candidate to notify the association of | ||
the candidate's request to be placed on the ballot and the deadline | ||
to submit the candidate's request. The deadline may not be earlier | ||
than the 10th day after the date the association provides the notice | ||
required by this subsection. | ||
(a-2) The notice required by Subsection (a-1) must be: | ||
(1) mailed to each owner; or | ||
(2) provided by: | ||
(A) posting the notice in a conspicuous manner | ||
reasonably designed to provide notice to association members: | ||
(i) in a place located on the association's | ||
common property or, with the property owner's consent, on other | ||
conspicuously located privately owned property within the | ||
subdivision; or | ||
(ii) on any Internet website maintained by | ||
the association or other Internet media; and | ||
(B) sending the notice by e-mail to each owner | ||
who has registered an e-mail address with the association. | ||
(a-3) An association described by Subsection (a-1) shall | ||
include on each absentee ballot or other ballot for a board member | ||
election the name of each eligible candidate from whom the | ||
association received a request to be placed on the ballot in | ||
accordance with this section. | ||
(d) This section does not apply to the appointment of a | ||
board member during a development period. [ |
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SECTION 16. Section 209.00594, Property Code, is amended by | ||
amending Subsections (b) and (c) and adding Subsections (b-1) and | ||
(d) to read as follows: | ||
(b) A person other than a person described by Subsection (a) | ||
may tabulate votes in an association election or vote [ |
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(b-1) A person who tabulates votes under Subsection (b) or | ||
who performs a recount under Section 209.0057(c) may not disclose | ||
to any other person how an individual voted. | ||
(c) Notwithstanding any other provision of this chapter or | ||
any other law, only a person [ |
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votes under Subsection (b) or who performs a recount under Section | ||
209.0057(c) [ |
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be given access to the ballots cast in the election or vote [ |
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(d) This section may not be construed to affect a person's | ||
obligation to comply with a court order for the release of ballots | ||
or other voting records. | ||
SECTION 17. Section 209.006, Property Code, is amended to | ||
read as follows: | ||
Sec. 209.006. NOTICE REQUIRED BEFORE ENFORCEMENT ACTION. | ||
(a) Before a property owners' association may suspend an owner's | ||
right to use a common area, file a suit against an owner other than a | ||
suit to collect a regular or special assessment or foreclose under | ||
an association's lien, charge an owner for property damage, or levy | ||
a fine for a violation of the restrictions or bylaws or rules of the | ||
association, the association or its agent must give written notice | ||
to the owner by certified mail[ |
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(b) The notice must: | ||
(1) describe the violation or property damage that is | ||
the basis for the suspension action, charge, or fine and state any | ||
amount due the association from the owner; [ |
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(2) except as provided by Subsection (d), inform the | ||
owner that the owner: | ||
(A) is entitled to a reasonable period to cure | ||
the violation and avoid the fine or suspension if the violation is | ||
of a curable nature and does not pose a threat to public health or | ||
safety [ |
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(B) may request a hearing under Section 209.007 | ||
on or before the 30th day after the date [ |
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notice was mailed to the owner; and | ||
(C) may have special rights or relief related to | ||
the enforcement action under federal law, including the | ||
Servicemembers Civil Relief Act (50 U.S.C. App. [ |
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et seq.), if the owner is serving on active military duty; | ||
(3) specify the date by which the owner must cure the | ||
violation if the violation is of a curable nature and does not pose | ||
a threat to public health or safety; and | ||
(4) be sent by verified mail to the owner at the | ||
owner's last known address as shown on the association records. | ||
(c) The date specified in the notice under Subsection (b)(3) | ||
must provide a reasonable period to cure the violation if the | ||
violation is of a curable nature and does not pose a threat to | ||
public health or safety. | ||
(d) Subsections (a) and (b) do not apply to a violation for | ||
which the owner has been previously given notice under this section | ||
and the opportunity to exercise any rights available under this | ||
section in the preceding six months. | ||
(e) If the owner cures the violation before the expiration | ||
of the period for cure described by Subsection (c), a fine may not | ||
be assessed for the violation. | ||
(f) For purposes of this section, a violation is considered | ||
a threat to public health or safety if the violation could | ||
materially affect the physical health or safety of an ordinary | ||
resident. | ||
(g) For purposes of this section, a violation is considered | ||
uncurable if the violation has occurred but is not a continuous | ||
action or a condition capable of being remedied by affirmative | ||
action. For purposes of this subsection, the nonrepetition of a | ||
one-time violation or other violation that is not ongoing is not | ||
considered an adequate remedy. | ||
(h) The following are examples of acts considered uncurable | ||
for purposes of this section: | ||
(1) shooting fireworks; | ||
(2) an act constituting a threat to health or safety; | ||
(3) a noise violation that is not ongoing; | ||
(4) property damage, including the removal or | ||
alteration of landscape; and | ||
(5) holding a garage sale or other event prohibited by | ||
a dedicatory instrument. | ||
(i) The following are examples of acts considered curable | ||
for purposes of this section: | ||
(1) a parking violation; | ||
(2) a maintenance violation; | ||
(3) the failure to construct improvements or | ||
modifications in accordance with approved plans and | ||
specifications; and | ||
(4) an ongoing noise violation such as a barking dog. | ||
SECTION 18. Section 209.0062(c), Property Code, is amended | ||
to read as follows: | ||
(c) A property owners' association is [ |
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allow a payment plan for any amount that extends more than 18 months | ||
from the date of the owner's request for a payment plan. The | ||
association is not required to enter into a payment plan with an | ||
owner who failed to honor the terms of a previous payment plan | ||
during the two years following the owner's default under the | ||
previous payment plan. The association is not required to make a | ||
payment plan available to an owner after the period for cure | ||
described by Section 209.0064(b)(3) expires. The association is | ||
not required to allow an owner to enter into a payment plan more | ||
than once in any 12-month period. | ||
SECTION 19. Section 209.0064(b), Property Code, is amended | ||
to read as follows: | ||
(b) A property owners' association may not hold an owner | ||
liable for fees of a collection agent retained by the [ |
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notice to the owner by certified mail[ |
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that: | ||
(1) specifies each delinquent amount and the total | ||
amount of the payment required to make the account current; | ||
(2) if the association is subject to Section 209.0062 | ||
or the association's dedicatory instruments contain a requirement | ||
to offer a payment plan, describes the options the owner has to | ||
avoid having the account turned over to a collection agent, | ||
including information regarding availability of a payment plan | ||
through the association; and | ||
(3) provides a period of at least 30 days for the owner | ||
to cure the delinquency before further collection action is taken. | ||
SECTION 20. Section 209.009, Property Code, is amended to | ||
read as follows: | ||
Sec. 209.009. FORECLOSURE SALE PROHIBITED IN CERTAIN | ||
CIRCUMSTANCES. A property owners' association may not foreclose a | ||
property owners' association's assessment lien if the debt securing | ||
the lien consists solely of: | ||
(1) fines assessed by the association; | ||
(2) attorney's fees incurred by the association solely | ||
associated with fines assessed by the association; or | ||
(3) amounts added to the owner's account as an | ||
assessment under Section 209.005(i) or 209.0057(b-4). | ||
SECTION 21. Section 209.0091, Property Code, is amended to | ||
read as follows: | ||
Sec. 209.0091. PREREQUISITES TO FORECLOSURE: NOTICE AND | ||
OPPORTUNITY TO CURE FOR CERTAIN OTHER LIENHOLDERS. (a) A property | ||
owners' association may not file an application for an expedited | ||
court order authorizing foreclosure of the association's | ||
assessment lien as described by Section 209.0092(a) or a petition | ||
for judicial foreclosure of the association's assessment lien as | ||
described by Section 209.0092(d) [ |
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(1) provided written notice of the total amount of the | ||
delinquency giving rise to the foreclosure to any other holder of a | ||
lien of record on the property whose lien is inferior or subordinate | ||
to the association's lien and is evidenced by a deed of trust; and | ||
(2) provided the recipient of the notice an | ||
opportunity to cure the delinquency before the 61st day after the | ||
date the association mails [ |
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described in Subdivision (1). | ||
(b) Notice under this section must be sent by certified | ||
mail[ |
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shown in the deed records relating to the property that is subject | ||
to the property owners' association assessment lien. | ||
(c) Notwithstanding any other law, notice under this | ||
section may be provided to any holder of a lien of record on the | ||
property. | ||
SECTION 22. Section 209.0092, Property Code, is amended by | ||
amending Subsection (a) and adding Subsections (d) and (e) to read | ||
as follows: | ||
(a) Except as provided by Subsection (c) or (d) and subject | ||
to Section 209.009, a property owners' association may not | ||
foreclose a property owners' association assessment lien unless the | ||
association first obtains a court order in an application for | ||
expedited foreclosure under the rules adopted by the supreme court | ||
under Subsection (b). A property owners' association may use the | ||
procedure described by this subsection to foreclose any lien | ||
described by the association's dedicatory instruments. A property | ||
owners' association whose dedicatory instruments grant a right of | ||
foreclosure is considered to have any power of sale required by law | ||
as a condition of using the procedure described by this subsection. | ||
(d) A property owners' association authorized to use the | ||
procedure described by Subsection (a) may in its discretion elect | ||
not to use that procedure and instead foreclose the association's | ||
assessment lien under court judgment foreclosing the lien and | ||
ordering the sale, pursuant to Rules 309 and 646a, Texas Rules of | ||
Civil Procedure. | ||
(e) This section does not affect any right an association | ||
that is not authorized to use the procedure described by Subsection | ||
(a) may have to judicially foreclose the association's assessment | ||
lien as described by Subsection (d). | ||
SECTION 23. Title 11, Property Code, is amended by adding | ||
Chapter 213 to read as follows: | ||
CHAPTER 213. MODIFICATION OR TERMINATION OF RESTRICTIONS IN | ||
CERTAIN REAL ESTATE DEVELOPMENTS BY PROPERTY OWNERS' ASSOCIATION OR | ||
PROPERTY OWNER PETITION | ||
Sec. 213.001. DEFINITIONS. In this chapter: | ||
(1) "Amenity property" means real property the use of | ||
which is restricted by a dedicatory instrument to use as a golf | ||
course or country club. | ||
(2) "Council of owners" has the meaning assigned by | ||
Section 81.002 as it relates to an existing condominium in a | ||
development. | ||
(3) "Dedicatory instrument" means a governing | ||
instrument that: | ||
(A) restricts amenity property to use as amenity | ||
property; | ||
(B) designates real property in the development, | ||
other than amenity property, as a beneficiary of a restriction | ||
described by Paragraph (A); and | ||
(C) addresses the establishment, maintenance, | ||
and operation of amenity property. | ||
(4) "Development" means: | ||
(A) amenity property; and | ||
(B) all real property designated as beneficiary | ||
property in the dedicatory instrument. | ||
(5) "Owner" means a person, or the person's personal | ||
representative, who holds record title to: | ||
(A) a lot or parcel of real property in a | ||
development; or | ||
(B) a unit or apartment of a condominium in the | ||
development. | ||
(6) "Petition circulator" means a person authorized to | ||
circulate a petition under Section 213.005. | ||
(7) "Property owners' association" means an | ||
incorporated or unincorporated association that: | ||
(A) is designated as the representative of the | ||
owners of lots or parcels of real property in a development; | ||
(B) has a membership primarily consisting of | ||
those owners; and | ||
(C) manages or regulates all or part of the | ||
development for the benefit of those owners. | ||
(8) "Restrictions" means one or more restrictive | ||
covenants contained or incorporated by reference in a properly | ||
recorded map, plat, replat, declaration, or other instrument filed | ||
in the real property records or map or plat records. The term | ||
includes any amendment or extension of the restrictions. | ||
(9) "Restrictive covenant" means any covenant, | ||
condition, or restriction contained in a dedicatory instrument, | ||
whether mandatory, prohibitive, permissive, or administrative. | ||
(10) "Unit owners' association" means an association | ||
of unit owners organized under Section 82.101 for a condominium in a | ||
development. | ||
Sec. 213.002. FINDINGS AND PURPOSE. (a) The legislature | ||
finds that: | ||
(1) a restriction on the use of an amenity property may | ||
create uncertainty if the owners of an amenity property are | ||
reluctant or unable to properly maintain or operate the amenity | ||
property; | ||
(2) such uncertainty may discourage investment and | ||
negatively impact property values in the development; | ||
(3) investors may be reluctant to or will not invest | ||
funds to revitalize an amenity property burdened with a restriction | ||
on its use; | ||
(4) financial institutions may be reluctant to or will | ||
not provide financing to revitalize an amenity property burdened | ||
with a restriction on its use; and | ||
(5) establishing a procedural option to allow for the | ||
modification or termination of the restriction would alleviate the | ||
uncertainty and encourage revitalization of the amenity property. | ||
(b) The purpose of this chapter is to provide a procedural | ||
option for the modification or termination of a restriction on the | ||
use of an amenity property. | ||
Sec. 213.003. MODIFICATION OR TERMINATION BY PETITION. | ||
(a) Except as provided by Subsection (b), a restriction on the use | ||
of an amenity property may be modified or terminated by petition in | ||
accordance with this chapter. | ||
(b) This chapter does not apply if: | ||
(1) a dedicatory instrument includes a procedure to | ||
modify or terminate a restriction on the use of an amenity property | ||
on approval of the owners of less than 75 percent of, as applicable, | ||
the lots or parcels of land and units or apartments of condominiums | ||
in the development; or | ||
(2) a restriction on the use of an amenity property may | ||
be modified or terminated under the procedures of Chapter 81, 82, | ||
201, or 209. | ||
Sec. 213.004. PREREQUISITES FOR CIRCULATION. A petition | ||
may not be circulated under this chapter unless: | ||
(1) for a continuous period of at least 36 months, the | ||
amenity property has not been in operation; and | ||
(2) if zoning regulations apply to the amenity | ||
property, the owner of the amenity property has received all | ||
required zoning approvals for any proposed redevelopment of the | ||
amenity property. | ||
Sec. 213.005. PETITION CIRCULATOR. A petition authorized | ||
by Section 213.003 may be circulated by: | ||
(1) an owner; | ||
(2) a property owners' association that owns and | ||
manages the amenity property; or | ||
(3) a unit owners' association or council of owners | ||
that owns and manages the amenity property. | ||
Sec. 213.006. CONTENTS OF PETITION. (a) The petition must | ||
include all relevant information about the proposed modification or | ||
termination, including: | ||
(1) the name of the development, if any; | ||
(2) the name of the amenity property, if any; | ||
(3) the recording information of the restriction to be | ||
modified or terminated; | ||
(4) the text of the restriction subject to | ||
modification or termination; | ||
(5) the text of the restriction as modified or | ||
terminated; and | ||
(6) a comparison of the original language of the | ||
restriction and the restriction as modified or terminated, showing | ||
any insertion and deletion of language or punctuation. | ||
(b) The petition must state: | ||
(1) reasonable times and dates the petition circulator | ||
will be available at a location in the development to receive a | ||
signed statement required by Section 213.008; | ||
(2) a mailing address, e-mail address, and facsimile | ||
number to which a signed statement may be delivered; and | ||
(3) the date by which a signed statement must be | ||
received to be counted. | ||
Sec. 213.007. CIRCULATION PROCEDURE. (a) A petition | ||
circulator shall deliver a copy of the petition to: | ||
(1) all owners of: | ||
(A) each lot or parcel of real property in the | ||
development; and | ||
(B) each unit or apartment of each condominium, | ||
if any, in the development; and | ||
(2) each property owners' association, unit owners' | ||
association, and council of owners in the development. | ||
(b) The petition circulator may deliver a copy of the | ||
petition in any reasonable manner, including: | ||
(1) by regular mail or certified mail, return receipt | ||
requested, to the last known address of the owners or entities | ||
described by Subsections (a)(1) and (2); | ||
(2) personal delivery to the owners or entities | ||
described by Subsections (a)(1) and (2); or | ||
(3) at a regular meeting of a property owners' | ||
association, unit owners' association, or council of owners. | ||
(c) If the petition circulator acts in good faith in | ||
determining ownership and delivering copies of the petition as | ||
required by this section, an owner's lack of receipt of a copy of | ||
the petition does not affect the application of a modification or | ||
termination of a restriction under this chapter to the amenity | ||
property. | ||
Sec. 213.008. VOTE ON PROPOSAL. (a) The modification or | ||
termination of the restriction is adopted if the owners of at least | ||
75 percent of the total number, as applicable, of the lots or | ||
parcels of land and the units or apartments of condominiums in the | ||
development, including the owner of the amenity property, vote in | ||
favor of the modification or termination of the restriction. | ||
(b) An owner may cast a vote only by delivering to the | ||
petition circulator in accordance with Section 213.009 a signed | ||
statement that includes: | ||
(1) the owner's name, the legal description or street | ||
address of the owner's property, and the owner's mailing address; | ||
(2) a statement that the owner holds record title to | ||
the property; | ||
(3) if more than one person owns an interest in the | ||
property, the name and mailing address of each co-owner; and | ||
(4) a statement indicating whether the owner is in | ||
favor of or against the modification or termination proposed by the | ||
petition. | ||
(c) An owner may vote only in favor of or against the | ||
modification or termination as proposed in the petition. | ||
(d) If more than one person owns an interest in a lot or | ||
parcel of land or a unit or apartment of a condominium, the owners | ||
may cast only one vote for that lot, parcel, unit, or apartment. | ||
Except as otherwise provided by this subsection, the vote of | ||
multiple owners in favor of or against the modification or | ||
termination may be reflected by the signatures of a majority of the | ||
co-owners who return a signed statement. The vote of owners who are | ||
married may be reflected by the signature of only one of those | ||
owners. | ||
(e) A person whose only property interest in a lot or parcel | ||
of land or unit or apartment of a condominium is that of a contract | ||
purchaser, lienholder, or mineral interest holder may not cast a | ||
vote for that property under this chapter. | ||
(f) A vote may be counted only if the vote is received before | ||
the deadline stated in the petition as required by Section | ||
213.006(b). | ||
(g) The signed statement of an owner conclusively | ||
establishes that: | ||
(1) the petition was received by the owner in | ||
accordance with Section 213.007; and | ||
(2) the statement accurately reflects the vote of the | ||
owner. | ||
Sec. 213.009. DELIVERY OF SIGNED STATEMENT. (a) The | ||
petition circulator must accept a signed statement described by | ||
Section 213.008 that is delivered: | ||
(1) in person under Section 213.006(b) or otherwise; | ||
(2) by first class mail to an address stated in the | ||
petition; | ||
(3) by e-mail to an address stated in the petition; or | ||
(4) by facsimile to a facsimile number stated in the | ||
petition. | ||
(b) This section supersedes any contrary provision in a | ||
dedicatory instrument. | ||
Sec. 213.010. CERTIFICATION OF RESULTS BY RECORDED | ||
AFFIDAVIT. (a) The petition circulator shall certify the result | ||
of the votes by filing an affidavit with the county clerk of the | ||
county in which the restriction modified or terminated is recorded. | ||
(b) The affidavit required by Subsection (a) must state: | ||
(1) the name of the development, if any; | ||
(2) the name of the amenity property, if any; | ||
(3) the recording information of the restriction that | ||
was modified or terminated; | ||
(4) the text of the restriction before modification or | ||
termination; | ||
(5) the text of the restriction as modified or | ||
terminated; | ||
(6) the number of votes in favor of and against the | ||
proposed modification or termination; | ||
(7) the name and address of the petition circulator; | ||
and | ||
(8) the name, address, and telephone number of the | ||
person maintaining the documents in accordance with Section | ||
213.013. | ||
(c) The petition circulator must affirm in the affidavit | ||
that the petition was delivered in accordance with Section 213.007. | ||
Sec. 213.011. NOTICE. (a) The recording of the affidavit | ||
required by Section 213.010 constitutes notice that the restriction | ||
is modified or terminated. | ||
(b) Notwithstanding Subsection (a), the petition circulator | ||
must deliver to each person who resides within 200 feet of the | ||
boundary of the amenity property a copy of the affidavit. The | ||
affidavit may be delivered by regular mail, by certified mail, | ||
return receipt requested, or by personal delivery. | ||
Sec. 213.012. EFFECTIVE DATE OF MODIFICATION OR | ||
TERMINATION. The modification or termination of the restriction | ||
takes effect on the later of: | ||
(1) the date the affidavit required by Section 213.010 | ||
is filed with the county clerk; or | ||
(2) the date, if any, specified as the effective date | ||
in the petition. | ||
Sec. 213.013. DOCUMENTATION AVAILABLE. At least one year | ||
after the date the affidavit is filed with the county clerk, the | ||
petition circulator shall make available for inspection and copying | ||
the original petition, the signed statements described by Section | ||
213.008, and the affidavit required by Section 213.010. | ||
Sec. 213.014. EXPIRATION. This chapter expires September | ||
1, 2021. | ||
SECTION 24. Section 209.0041(a), Property Code, is | ||
repealed. | ||
SECTION 25. (a) Section 82.157(a), Property Code, as | ||
amended by this Act, applies only to a resale certificate issued on | ||
or after the effective date of this Act. A resale certificate | ||
issued before the effective date of this Act is governed by the law | ||
as it existed immediately before the effective date of this Act, and | ||
that law is continued in effect for that purpose. | ||
(b) The changes in law made by this Act to Chapter 207, | ||
Property Code, apply only to a request for subdivision information | ||
made on or after the effective date of this Act and any resale | ||
certificate delivered in response to that request. A request for | ||
subdivision information made before the effective date of this Act, | ||
any resale certificate delivered in response to that request, and | ||
any request for an update of that resale certificate are governed by | ||
the law as it existed immediately before that date, and that law is | ||
continued in effect for that purpose. | ||
(c) Sections 209.0041, 209.0056, 209.0057, 209.0058, | ||
209.00592, 209.00593, and 209.00594(c), Property Code, as amended | ||
by this Act, apply only to an election or vote held on or after the | ||
effective date of this Act. An election or vote held before the | ||
effective date of this Act is governed by the law as it existed | ||
immediately before that date, and that law is continued in effect | ||
for that purpose. | ||
(d) Section 209.006, Property Code, as amended by this Act, | ||
applies only to an enforcement action taken on or after the | ||
effective date of this Act. An enforcement action taken before the | ||
effective date of this Act is governed by the law as it existed | ||
immediately before that date, and that law is continued in effect | ||
for that purpose. | ||
(e) Section 209.0064, Property Code, as amended by this Act, | ||
applies only to a collection action taken on or after the effective | ||
date of this Act. A collection action taken before the effective | ||
date of this Act is governed by the law as it existed immediately | ||
before that date, and that law is continued in effect for that | ||
purpose. | ||
(f) Section 209.0091, Property Code, as amended by this Act, | ||
applies only to an application or petition filed on or after the | ||
effective date of this Act. An application or petition filed before | ||
the effective date of this Act is governed by the law as it existed | ||
immediately before that date, and that law is continued in effect | ||
for that purpose. | ||
SECTION 26. Chapter 213, Property Code, as added by this | ||
Act, does not apply to a petition circulated before the effective | ||
date of this Act. | ||
SECTION 27. This Act takes effect September 1, 2015. | ||
______________________________ | ______________________________ | |
President of the Senate | Speaker of the House | |
I hereby certify that S.B. No. 1168 passed the Senate on | ||
May 6, 2015, by the following vote: Yeas 27, Nays 4; and that the | ||
Senate concurred in House amendments on May 28, 2015, by the | ||
following vote: Yeas 26, Nays 5. | ||
______________________________ | ||
Secretary of the Senate | ||
I hereby certify that S.B. No. 1168 passed the House, with | ||
amendments, on May 24, 2015, by the following vote: Yeas 142, | ||
Nays 0, two present not voting. | ||
______________________________ | ||
Chief Clerk of the House | ||
Approved: | ||
______________________________ | ||
Date | ||
______________________________ | ||
Governor |