Quick Summary of 2025 Pending Arizona Legislation Pertaining to HOAs and Condos

Updated: March 17, 2025

The 2025 Arizona Legislature is in session and it is going to be a BIG year for HOA and condo bills!   Set forth below is a quick summary of the pending bills. All the bills below apply to planned communities and condominiums unless otherwise indicated.

PASSED IN SENATE – MOVED TO HOUSE:

SB 1039 – HOMEOWNER’S ASSOCIATIONS; MEETINGS; RECORDINGS: This bill requires that if a board records a meeting that is OPEN to members, the board shall keep a copy of the recording for at least six months and make the unedited recording available to any member on request.

SB 1337 – HOMEOWNER’S ASSOCIATIONS; VIOLATIONS; NOTICES: This bill requires prescribed information to be included in an original notice of violation rather than providing it later in response to an owner.  Allows owners who receive a written notice of violation to request (electronically or by certified mail) the name of the person who observed the violation.  It also allows owners to respond electronically to a written notice of violation.

SB 1378 – POLITICAL SIGNS; HOMEOWNERS’ ASSOCIATIONS:  This bill changes the definition of “Political sign” to include a sign or flag.

SB 1494 – COMMON EXPENSE LIENS; FORECLOSURE; AMOUNT: Raises the assessment delinquency time-period from one year to TWO YEARS, and dollar amount from $1,200 to $10,000 for the purpose of allowing foreclosure of an assessment lien. Other minor technical corrections. Applies ONLY to Planned Communities.

SB 1535 – HOMEOWNER’S ASSOCIATIONS; ADDRESS LIGHTS: This bill provides that associations (regardless of the governing documents) may not prohibit lighted home address signs that meet the certain criteria.

PASSED IN HOUSE – MOVED TO SENATE:

HB 2322 – CONDOMINIUMS; COMMERCIAL STRUCTURES; RESIDENTIAL STRUCTURES: This bill addresses assessments on commercial versus residential structures in a condominium.  Also included in this bill are definitions of commercial structure, common expenses and residential structure.  Applies ONLY to Condominiums.

HB 2723 – MUNICIPALITIES; ASSOCIATIONS; RESTRICTIONS: This bill defines circumstances under which a municipality is allowed to require developers to establish associations.  Provides that associations may NOT be required to adopt rules/regs more restrictive than any municipal rules/regs.  Applies ONLY to associations established after July 24, 2014.  Applies ONLY to Planned Communities.

HB 2865 – HOMEOWNERS’ ASSOCIATIONS; ATTORNEY FEES: This bill addresses attorney fees and related costs as follows: Regardless of the governing documents, associations may not charge any owner/member for attorney fees/costs incurred by the association and Owners/members may recover attorney fees/costs from the association IF they prevail in legal proceedings. Does NOT apply to association disputes with any parties other than owners who are not declarants.  Applies to Planned Communities and Condominiums.

HB 2866 – HOMEOWNER’S ASSOCIATIONS; UNLAWFUL ENFORCEMENT; DAMAGES:

Provides for damages against associations that attempt to enforce illegal governing document provisions as follows: $1,000 for a 1st attempt to enforce, and $2,500 for 2nd and subsequent attempts to enforce. Such damages accrue based on the number of attempts to enforce regardless of whether enforcement is attempted against the same or different owners/members. Owners/members may pursue such damages against the association in any court of competent jurisdiction. Applies to Planned Communities and Condominiums.

STILL ON HOUSE FLOOR – AD COW ACTION on 3/12:

HB 2442 – HOMEOWNERS’ ASSOCIATIONS; BUDGET RATIFICATION; REQUIREMENTS: 

This bill is still undergoing amendments – has not yet passed the House.

Would prohibit associations from: (1) passing a special assessment (or obtaining a loan) for extraordinary or unanticipated expenses, and (2) using regular assessments (or a loan) for unanticipated expenses.

Any proposed budget (including critical expenses that have risen more than the CPI) would require: (1) ratification by the owners, and (2) amendment of the budget to meet owners’ changing priorities under penalty of removal.

Restricts/prohibits the following without approval of a majority vote of the owners:

  1. Restricts associations from raising funds to address cost increases; and
  2. Prohibits a board/management company from spending or transferring funds from the association’s reserve accounts for any purpose that is not included in the governing documents.

Contains technical changes.

Defines “Consumer Price Index.”

 

Please feel free to contact Beth Mulcahy, Esq. at bmulcahy@mulcahylawfirm.com with any questions.