H 963

                    LEGISLATURE OF THE STATE OF IDAHO
 Sixty-eighth Legislature  Second Regular Session - 2026
                       IN THE HOUSE OF REPRESENTATIVES
                              HOUSE BILL NO. 963
                         BY WAYS AND MEANS COMMITTEE
1AN ACT
2  RELATING TO HOMEOWNER'S ASSOCIATIONS; AMENDING SECTION 55-3204, IDAHO CODE,
3      TO REVISE PROVISIONS REGARDING THE ADMINISTRATION OF AN INCORPORATED OR
4      UNINCORPORATED HOMEOWNER'S ASSOCIATION; AMENDING CHAPTER 32, TITLE 55,
5      IDAHO CODE, BY THE ADDITION OF A NEW SECTION 55-3204C, IDAHO CODE, TO
6      ESTABLISH PROVISIONS REGARDING AUTOMATIC CONVERSION OF HOMEOWNER'S AS-
7      SOCIATIONS TO JOINT OWNERSHIP ASSOCIATIONS; AMENDING CHAPTER 32, TITLE
8      55, IDAHO CODE, BY THE ADDITION OF A NEW SECTION 55-3214, IDAHO CODE,
9      TO PROVIDE FOR JOINT OWNERSHIP ASSOCIATIONS; AND PROVIDING AN EFFECTIVE
10     DATE.
11 Be It Enacted by the Legislature of the State of Idaho:
12     SECTION 1. That Section 55-3204, Idaho Code, be, and the same is hereby
13 amended to read as follows:
14     55-3204. ADMINISTRATION OF AN INCORPORATED OR UNINCORPORATED HOME-
15 OWNER'S ASSOCIATION. (1) Board meetings must be open to the members of the
16 homeowner's association and any representative or agent designated in a
17 signed writing by a member to represent the member.
18     (2) An executive session at which members of the homeowner's associa-
19 tion are excluded may be held upon a majority vote of the board for the fol-
20 lowing purposes:
21     (a) To consider matters of personnel, hiring, bid review, or contract
22     negotiation;
23     (b) To consider records that are not subject to disclosure under part
24     11, chapter 30, title 30, Idaho Code;
25     (c) To consult with an attorney for the purpose of obtaining legal ad-
26     vice. The mere presence of legal counsel at a board meeting shall not
27     justify entering into executive session;
28     (d) To discuss ongoing or potential litigation, mediation, arbitra-
29     tion, or administrative proceedings; or
30     (e) To discuss sensitive matters related to an individual member's
31     property or assessments, such as violations or delinquent assessments.
32     (3) All homeowner's associations, whether incorporated or unincorpo-
33 rated, shall:
34     (a) Hold a meeting of the membership each calendar year. Such meeting
35     may be conducted in person or, with the approval of a simple majority of
36     the members, through an electronic or hybrid meeting model;
37     (b) Be governed by the provisions of sections 30-30-501 and 30-30-505,
38     Idaho Code, as those provisions relate to notice of meetings of the
39     homeowner's association. The board may adopt a process for members to
40     choose to receive notice of any meeting of the homeowner's association
41     by electronic means rather than by mail. All dates and information of
42     the notice must remain the same as a mail notice;
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1(c) Take minutes from all meetings of the homeowner's association, in-
2cluding membership meetings and board meetings, and preserve such min-
3utes for a minimum of ten (10) years; and
4(d) Determine and establish the amount of assessments in accordance
5with the governing documents or, in the event the governing documents
6do not include such language, with the approval of a majority of the
7members of the homeowner's association.
8(4) At a meeting of the membership, to constitute a quorum on a matter,
9  ten percent (10%) of the votes entitled to be cast on the matter shall be rep-
10 resented in person, by proxy, by mailed written ballot, by absentee ballot,
11 or by means of remote communication to the extent authorized by the board of
12 directors.
13      (4) (5) At an annual meeting of the homeowner's association, board mem-
14 bers shall declare any conflict of interest or familial relationship that
15 exists with respect to such board member and any person or entity who has pre-
16 viously entered into or seeks to enter into a service contract with the home-
17 owner's association.
18      (5) (6) A board of a homeowner's association may not use its power to
19 adopt rules governing the common property to expand the provisions of the re-
20 strictive covenants as they relate to a member's property.
21      (6) (7) All homeowner's associations, whether incorporated or unincor-
22 porated, shall be governed by sections 30-30-502 and 30-30-608, Idaho Code,
23 as those sections relate to the removal of a board member and the process of
24 calling a special meeting for such removal.
25      (7) (8) Unincorporated homeowner's associations shall be governed by
26 bylaws that provide for at least the following:
27      (a) A requirement that the homeowner's association holds at least one
28      (1) meeting each calendar year;
29      (b) A requirement that notice of any meeting of the homeowner's associ-
30      ation be published and distributed to all members of the homeowner's as-
31      sociation;
32      (c) A requirement that the minutes of all homeowner's association meet-
33      ings be taken and preserved;
34      (d) A method of adopting and amending fees; and
35      (e) A provision that no fees or assessments of the homeowner's asso-
36      ciation may be increased unless a majority of all members of the home-
37      owner's association vote in favor of the increase.
38      (8) (9) If a homeowner's association violates any of the provisions of
39 this chapter and a member prevails in a legal action to protect his rights,
40 the member shall be entitled to an award of reasonable attorney's fees.
41     SECTION 2. That Chapter 32, Title 55, Idaho Code, be, and the same is
42 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
43 ignated as Section 55-3204C, Idaho Code, and to read as follows:
44     55-3204C. JOINT OWNERSHIP ASSOCIATIONS -- CONVERSION. (1) Any home-
45 owner's association that has been in existence for ten (10) years or more,
46 pursuant to the date of the filing of articles of incorporation or the date of
47 establishing bylaws for unincorporated homeowner's associations, as of Jan-
48 uary 1, 2027, shall automatically convert to a joint ownership association
49 (JOA), as provided in section 55-3214, Idaho Code, on January 1, 2030, unless
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1  its members vote against such conversion pursuant to the provisions of this
2  section. Any homeowner's association that has been in existence for less
3  than ten (10) years as of January 1, 2027, or that is created after January 1,
4  2027, shall automatically convert to a JOA after ten (10) years from the date
5  of the filing of articles of incorporation or the date of establishing bylaws
6  for unincorporated homeowner's associations unless its members vote against
7  such conversion pursuant to the provisions of this section.
8(2) A homeowner's association shall hold a meeting of its membership
9  before the automatic conversion dates provided for in subsection (1) of this
10 section to provide an opportunity for its members to vote against the auto-
11 matic conversion of the homeowner's association to a JOA. A homeowner's as-
12 sociation shall give notice to its members of the proposed meeting in accor-
13 dance with the provisions of section 30-30-505, Idaho Code. The notice shall
14 state that the purpose, or one (1) of the purposes, of the meeting is to con-
15 sider the automatic conversion of the homeowner's association to a JOA and
16 shall contain or be accompanied by a copy or summary of a plan of conversion,
17 including a summary of the proposed JOA governing documents and the impacts
18 of conversion. The plan of conversion shall provide for the transfer of as-
19 sets and liabilities from the homeowner's association to the JOA, including
20 transfer of title to all common property and transfer of all financial as-
21 sets to the JOA. No automatic conversion of a homeowner's association to a
22 JOA shall occur if a quorum is present and a majority of the votes represented
23 and voting vote against such conversion.
24      (3) If a majority of the members of a homeowner's association do not
25 vote against the automatic conversion of the homeowner's association to a
26 JOA, the homeowner's association shall convert to a JOA. Such vote shall con-
27 stitute authorization to amend or terminate existing governing documents,
28 to establish a JOA by filing articles of incorporation or by establishing
29 bylaws for unincorporated JOAs, and to transfer common property and assets
30 to the JOA. Upon incorporation or establishment of bylaws for unincorporated
31 JOAs, all covenants, conditions, and restrictions granting the association
32 authority to regulate anything other than preserving, maintaining, repair-
33 ing, and managing common property shall be terminated. All terms necessary
34 to preserving common easements, maintenance obligations, or other related
35 items shall remain in effect unless expressly amended. All common property,
36 including common areas, limited common areas, other property or improve-
37 ments owned or maintained by a homeowner's association, or property owned in
38 common by the members of a homeowner's association shall remain dedicated to
39 the common use of the members of the JOA.
40      (4) If a majority of the members of a homeowner's association vote
41 against the automatic conversion of the homeowner's association to a JOA,
42 the homeowner's association shall continue under the same terms. Home-
43 owner's associations shall automatically convert to JOAs ten (10) years
44 after the date of the first successful vote against automatic conversion.
45 Automatic conversion shall occur every ten (10) years thereafter while a
46 homeowner's association is in existence unless and until the members fail to
47 vote against such conversion and the homeowner's association is automati-
48 cally converted as provided in this section.
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1      SECTION 3. That Chapter 32, Title 55, Idaho Code, be, and the same is
2  hereby amended by the addition thereto of a NEW SECTION, to be known and des-
3  ignated as Section 55-3214, Idaho Code, and to read as follows:
455-3214. JOINT OWNERSHIP ASSOCIATIONS -- CREATION. (1) A joint owner-
5  ship association may be created as provided in this section in lieu of a home-
6  owner's association. For purposes of this section, a "joint ownership asso-
7  ciation" or "JOA" means any incorporated or unincorporated residential as-
8  sociation in which membership is based on owning or possessing an interest in
9  real property and that has ownership of common property with the authority to
10 preserve, maintain, repair, and manage such property. Common property means
11 any property owned by the JOA that is available to all members of the commu-
12 nity, including but not limited to private roads, parks, open spaces, recre-
13 ational facilities, and water rights.
14      (2) A JOA shall have the authority to:
15      (a) Levy assessments against lots for the actual and reasonable costs
16      incurred in the maintenance and management of common property;
17      (b) Obtain insurance for common property; and
18      (c) Enter into contracts necessary for the maintenance and management
19      of common property.
20      (3) A JOA shall not have the authority to adopt or enforce any rules reg-
21 ulating conduct that is not directly related to common property. A JOA shall
22 not have the authority to regulate aesthetic standards, land use restric-
23 tions beyond those imposed by law, or private covenants unrelated to common
24 property.
25     SECTION 4. This act shall be in full force and effect on and after Jan-
26 uary 1, 2027.