There are not many people that get excited about record keeping, but it must be a top priority for any Arizona HOA. Arizona law makes any association or planned community responsible for accurate record keeping and providing those records to any individual member upon request. This ensures that homeowners associations are transparent, and members can hold them accountable. These HOA disclosure requirements also mean that board members must understand their responsibilities and have an organized process for record keeping. Here is what all board members need to know about Arizona HOA disclosure requirements and some tips on best practices for HOA record keeping.
Arizona HOA Disclosure Requirements
Arizona Revised Statutes 33-1805 and 33-1258 defines the HOA disclosure requirements that all AZ HOA board members need to understand. Other than some specific exceptions, all financial records and other governing documents need to be readily available for any individual member to review upon request. Individual members can request copies of these documents and HOAs must provide those copies within 10 business days of the request. HOAs can charge nominal fee per page to the member for producing copies of the requested documents. The amount that the association can charge is set by the statutes.
Arizona HOA Disclosure Exceptions
A.R.S. 33-1805 and 33-1258 also detail the records that are exempt from Arizona’s HOA disclosure requirements. All privileged communications between the association and the association’s attorney do not have to be shared with individual members. The details of pending litigation do not need to be made available upon request either. Any personal information on the finances or health of an individual member in the possession of the association or board members must not be shared or made available to other members. These exceptions also apply to any information on the job performance or personal details of any association employees. Any meeting minutes from closed executive sessions of board meetings for need not to be disclosed to individual members. Open meeting minutes and annual meeting minutes must be provided.
Best Practices for HOA Record Keeping and Producing Documents
Every Arizona HOA must have an established process for keeping all meeting minutes, financial records and general details of the operations. Typically, a homeowners association will hire a management company that will assist with organizing and storing the records. The Association will be responsible for keeping and producing these records upon request. This also means it is the association’s responsibility to maintain a process for separating out or redacting any records that should not be disclosed. If this process is not strictly maintained, it can be easy to accidentally share privileged information when processing a routine record request. This is an important process to review regularly with the association’s attorney to make sure that you have appropriately separated or redacted any information or records that should not be disclosed.
Some HOA records must always be kept on file. These records include the covenants, conditions and restrictions (CC&Rs), original articles of incorporation, bylaws, deeds, and easements. A.R.S. 10-11601 requires meeting minutes to be kept permanently. Fine notices should be kept for as long as an owner owns a property in the community and one year after. This helps to protect the HOA for any litigation that might arise within the statute of limitations for claims filed against the association. The attorneys at Halk, Oetinger, and Brown can assist with developing a document retention policy and schedule for adoption by a homeowners association.
Many HOAs still keep these records in paper copies in storage. If an HOA has not already explored moving as many records as possible to digital storage, that is an excellent goal for this year. Moving as much document storage as possible to a secure online storage option will make it much easier to produce any requested documents for individual members. It should generally make it easier to stay organized all around.
Establish a Better Disclosure Process with an AZ HOA Law Firm
If an Arizona HOA does not have an established and organized process for record keeping and disclosure, it can be overwhelming for the board when many different individual members start asking for copies of key documents. This is one of the most important reasons to work with an experienced HOA law firm on keeping the right records up to date and segmenting those records that should not be shared with individual members. Halk, Oetinger, and Brown only represents Arizona associations and planned communities. Our team specializes in keeping your HOA in compliance with all Arizona statutes related to association governance. Our attorneys can make sure your record keeping practices are optimal and disclosure requests go through a standard process. Contact us today at 602-952-6925 to schedule a consultation with our experienced HOA attorneys or make an appointment online.
Halk, Oetinger, and Brown shares this article for informational purposes only and it does not create an attorney-client relationship.
