HB1453
To Amend The Horizontal Property Act; And To Regulate Property Owners' Associations.
AI-Generated Summary
This bill proposes amendments to Arkansas's Horizontal Property Act and introduces regulations for property owners' associations. It redefines "co-owner" and "person" to explicitly include members of property owners' associations. The bill introduces definitions for "business day," "local government," and "property owners' association." It mandates that bylaws of horizontal property regimes must include specific provisions for administration, decision-making processes requiring a 51% majority, and collection of common expenses. Modifications to administration or bylaws must be approved through established procedures and recorded. The bill requires administrators to maintain detailed financial records and submit annual reports, making these records accessible to co-owners. Furthermore, property owners' associations may be subject to audit by Arkansas Legislative Audit under certain conditions, including receiving state funding or providing local government-traditionally performed services. Members of the General Assembly can also request an audit with committee approval.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries of this bill would be the co-owners within horizontal property regimes, who would gain greater transparency and access to financial records of their associations. Property owners' associations themselves, particularly those that are incorporated nonprofit organizations, would benefit from clearer definitions and procedures for administration and financial reporting. The public may benefit from increased accountability of property owners' associations that receive state funding or perform functions traditionally handled by local governments, due to the potential for audits.
Who Might Suffer?
Property owners' associations that are not transparent with their financial dealings or that operate with less formal procedures might be negatively impacted by the increased requirements for record-keeping, reporting, and accessibility of financial information. Administrators or boards of these associations may face additional administrative burdens. Property owners' associations that do not receive state funding but provide services traditionally performed by local governments could also experience an impact if they are subjected to audits they were not previously anticipating. Individual co-owners, depending on their current level of involvement and understanding of association finances, might find the new requirements for accessible financial records to be a burden if they are in leadership positions.