The Difference Between Rules and Policies in HOAs and What That Means for Residents

When homeowners opt to live in a homeowners’ association (HOA), they agree to abide by the rules and conditions set forth by the bylaws, CC&R’s, and other HOA policies. However, if new homeowners are like most homeowners, they are not familiar with the differences between bylaws, covenants, conditions, and restrictions (CC&Rs), and rules and regulations. The board of directors should make it a point to help new homeowners better understand their rights, but then, many directors do not fully understand the difference between the governing documents and policies themselves. Our Scottsdale HOA property management services at City Property Management are prepared to help you draft your documents in such a way that they can be understood by all, as well as help new homeowners understand their rights under such documents.

Bylaws

The bylaws of the community are a legally recorded document that details the duties of the board of directors and association. Some things covered in the bylaws include but are not limited to the following:

  • The process of nominating and electing new board members
  • Frequency of HOA board elections
  • The length of board member service terms
  • The number of members that may serve at any given time
  • Meeting frequency and minimum requirements
  • The responsibilities and duties of board members

If a homeowner is dissatisfied with a provision set forth in the bylaws, they will have a difficult time changing the provision, as any change to bylaws requires a majority vote of the membership, legal fees due to the necessity of attorney counsel, and government document filing fees.

Covenants, Conditions, & Restrictions (CC&Rs)

CC&Rs establish the day-to-day governance of a homeowners’ association. Basically, this set of laws dictate how HOAs go about their daily business. The CC&Rs are a legally binding document that must be recorded with the state and covers the rights and obligations of homeowners’ associations to its members and vice versa. Some legal issues that many CC&Rs cover are as follows:

  • Lender protection provisions
  • Property use restrictions
  • Assessment obligations
  • Clearly defined maintenance obligations for the HOA and its members
  • Insurance obligations
  • Mechanisms for dispute resolution and rule enforcement.

Because CC&Rs are kept on file with the state, they can be difficult to dispute and revise. Much like the bylaws, if a homeowner or board director wishes to make an amendment to the CC&Rs, he or she must obtain the majority vote before beginning legal proceedings.

Rules and Regulations

The community’s rules and regulations are a catch-all for rules that are not covered by the CC&R or bylaws. Typically, most HOAs include provisions within its policies that they know will need revising over time, and as residents’ needs change. It is important to note that the rules and regulations cannot contradict the CC&R’s or bylaws and instead are providing more specific rules based on the ones already set forth in the governing documents.

Rules and regulations can be easily changed via board review and membership discussion. If an HOA board thinks that a rule needs to change, it might adopt a new rule or change an existing rule and send out a notice to the community. These changes to the rules and regulations are voted on by the board of directors at open board meetings, at which homeowners can attend and voice any concerns.

Work With a Property Management Company

Whether you are a board member of an HOA or a member, our team at City Property Management Company can help you better understand your rights, responsibilities, and obligations. Contact our team today to learn more about how we can assist you.

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