Residential Real EstateThree Rs: Rules, Regulations & Resolutions
Every homeowner association has various methods available for establishing acceptable standards. As a benchmark, those standards must stand the test of federal law: For example, the board cannot enact a rule that flies in the face of the Fair Housing Act.
Sometimes standards or rules are clearly defined in the governing documents. More often, however, the governing documents only provide a framework for making rules and leave the "fleshing out" process up to the board. This is done on purpose to allow flexibility. The board may use either rules, regulations or resolutions to accomplish this goal. So what’s the difference?
Rules and Regulations are limited to addressing rules of conduct in the common or limited common area such as:
Hours of operation
Restrictions (use of clubhouse, pool)
Limitations on guest use
When adopting rules, it’s wise for the board to solicit owner input for a greater degree of compliance. And always make sure to follow the dictates of governing documents when adopting, amending or revoking rules and regulations. The board cannot enact a rule that contradicts what it written in the governing documents.
Amending the governing documents requires a vote of the members and by the majority indicated by the governing documents which is usually quite high. Reaching this majority is not easy so amendments should not be undertaken lightly. However, if the governing documents are unwieldy or in violation of the law, amending them may be necessary. Consult with an attorney knowledgeable in homeowner association law.
Resolutions are the preferred method of establishing procedures for the homeowner association. Resolutions come in two types, policy and administrative.
Policy Resolutions define acceptable standards. An example of a policy resolution is the Areas of Maintenance Responsibility Policy. Many governing documents are unclear with regard to homeowner association versus owner maintenance responsibilities. Who repairs a water supply line after it enters an owner’s unit? Who repairs damage from a flood originating in an upper unit? There are many variations on this theme that could be answered in a policy resolution that defines each item according to who is responsible. This particular resolution directly impacts insurance homeowner association and owner responsibilities. Other common policy resolutions deal with Collection, Parking, Pets and Architectural Guidelines.
Administrative Resolutions define procedural guidelines, like how to run effective board and homeowner meetings.
Mechanics of Formulating a Resolution. The resolution should first cite the relevant provisions of the governing documents and any applicable state statute, especially those sections which give the homeowner association authority to establish policies. Following the authority section are the details of the resolutions. It is advisable to circulate any proposed resolution to the membership for a minimum 30 day period for comment before the board votes on it. Once approved, it should be dated and signed by the board president and the secretary.
The Three Rs help provide a clear and systematic way to deal with routine enforcement issues. Once enacted, they need to be consistently enforced year in and year out and apply to all members including the members of the board.
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