Homeowners’ associations, or “Unit Owners Associations” as they are referred to by Pennsylvania law, must are regulated by the Uniform Planned Community Act which provides specific rules regarding the creation and management of common interest communities. There is also the Uniform Condominium Act that provides regulations for Condominium Associations. All community associations must be incorporated as a non-profit and are also subject to PA Nonprofit Law.
Homeowners Association’s Rights and Responsibilities
The primary responsibility of the HOA is to provide maintenance for all common elements within the community and protect property values. To create and maintain a budget for maintenance costs, the association may collect regular mandatory assessments from homeowners. Reserves may also be kept following the annual budget set forth by the association board of directors.
Homeowners’ associations may also impose fines for any violations of community regulations and fees on any late payments. If an account becomes delinquent, liens may be placed on the property. In extreme cases, the association may even foreclose on the property despite on-time mortgage payments.
It is the responsibility of the board of directors to maintain detailed community records including financial records and minutes of all meetings. They must also maintain at least property and general liability insurance on all common elements. Property insurance must cover at least 80% of the cash value of common elements.
Homeowners have the right to elect members to the board of directors and vote on proposed amendments to the community declaration. To amend the declaration, at least 67% of the allocated votes must agree. If an amendment is adopted, it must be recorded in the county in which the community is located to take effect.
Voting takes place at association meetings which must be held at least annually, if not more frequently as described by the bylaws. The process for calling special meetings should be described in the community declaration. The board of directors must provide notice of all meetings at least ten days, but no more than 60 days before the meeting is scheduled to take place.
Votes can be allocated in several ways. The community declaration should provide the formula for calculating votes. The number of votes per property should correlate with the number of assessments paid. If a property receives more votes, it also receives a greater share of the community costs.
Improvements And Alterations
If it is not explicitly stated in the community declaration, homeowners may make improvements and alterations without permission from the association on units so long as they do not interfere with the structural integrity of the building.
If desired, unit owners can terminate the common interest community with an 80% vote at an annual or special meeting.
Any surplus funds at the end of the fiscal year must be returned to homeowners in the form of credits on the next assessment.
Upon purchase of property within a planned community with an HOA, a public offering statement must be provided to the buyer describing community regulations. The buyer then has seven days to cancel the deal if they choose. If they continue with the purchase, they must obey all rules set forth by community documents.
PA Uniform Planned Community Act
To ensure that your community association is being run following all state and local laws, it helps to have a professional on your side. CSM has a team of experienced professionals that have worked with communities in almost every state in the US. Specializing in HOA financial management, we can help your board of directors manage association finances, write and submit documents, and prepare for audits. If you have any questions regarding state HOA laws and regulations, give us a call at (865) 315-7505, contact us online or email us at email@example.com.