Montana HOA legislation protects private property rights

By Deborah Goonan, Independent American Communities

Updated April 19, 2019

This week, Montana Senate Bill 300 passed both chambers of the state Legislature, as amended. Introduced by Senator Kenneth Boger (R), SB0300 upholds “use” rights of property owners in HOA-governed communities.

The bill begins as follows:

Section 1. Homeowners’ association restrictions — real property rights. (1) (a) A homeowners’ association may not enter into, amend, or enforce a covenant, condition, or restriction in such a way that imposes more onerous restrictions on the types of use of a member’s real property than those restrictions that existed when the member acquired the member’s interest in the real property, unless the member who owns the affected real property expressly agrees in writing at the time of the adoption or amendment of the covenant, condition, or restriction.

Read full text of MT SB300.

 

How SB0300 protects private property rights for homeowners

Put simply, your HOA cannot force you to comply with new, “more onerous” restrictions than you “agreed to” when you acquired your property.

To document that your property rights are “grandfathered in,” a written exception to the CC&Rs will be recorded with the County.

When your property conveys to a new owner (who is not a co-owner), the limited exception to the CC&Rs expires.

 

Here’s why a majority of Montana Legislators voted to protect your property rights

When a property owner acquires a parcel in a planned community, he or she does so with certain expectations, based upon allowable uses as written in the CC&Rs at the time.

Suppose you buy a few acres of land, build a home and a storage shed, grow your own vegetables, and keep several chickens. You enjoy fresh food, and life is good, until a group of your neighbors decides they don’t your chickens.

One of your neighbors decides to supplement his retirement income by renting part of his large home to tenants. Now there are two more vehicles parked on his property. But someone on your HOA board doesn’t like to look at parked cars on your property.

A third neighbor earns extra money by renting her guest house as a vacation destination. The guests are quiet and respectful, but a few of the neighbors complain about “transients” in their community.

Current CC&Rs do not prohibit any of these “types of uses” for your private property. So there’s nothing your neighbors can do to stop you from using your property as you see fit, so long as you don’t break any local laws or disturb the peace.

 

HOA seeks more control over your property

Nevertheless, your HOA board decides it’s time to restrict short-term and long-term rentals, and banish chickens from the community. They organize a campaign to amend the CC&Rs.

The HOA board controls all communication in your community. It distributes a newsletter to all homeowners, insisting that backyard chickens and renters destroy the “character” of the neighborhood, and bring down property values.

Members vote on the proposed amendments, and two-thirds of the votes cast favor new rental restrictions and a prohibition on chickens.

In short, the voting majority of owners takes away the rights of the voting minority. And, by limiting the ways you can use your property, the HOA cuts off income and food sources you rely on.

It’s not fair. It’s unconstitutional. And it’s un-American.

This was the motivation behind SB0300.

 

 

A game changer for homeowner rights, opposed by the HOA industry trade group

As usual, trade group Community Associations Institute (CAI) is on the record against SB0300 and protection of private property rights!

CAI laments:

The broad and sweeping language in SB 300 fundamentally changes the way rules apply to residents in these housing models. Currently, homeowners associations and condominiums adopt rules in the community, usually with a majority or super-majority vote of the members in the community.  The rules are then applied to all owners in the community.  SB300 eliminates this democratic process and will have devastating and expensive consequences.

Homeowner associations, community management companies, community association law firms, and  numerous other trade groups from the development and real estate industry all oppose SB 300.

Source: MONTANA STATE LEGISLATURE MOVES BILL THAT WILL CREATE CHAOS, LAWSUITS, AND INCREASE COSTS ON RESIDENTS IN CONDOMINIUM AND HOMEOWNERS ASSOCIATIONS (CAI press release, April 3, 2019)

Did you catch that? CAI’s view of “democracy” is the unpleasant reality created by a tyranny of the majority.

The trade group that claims to represent nearly 70 million residents of association-governed communities proclaims it is vehemently against preventing a group of your neighbors from taking away your rights.

HOA industry trade groups have no respect for your rights if you’re in the voting minority in your common interest community.

Montana Legislators who voted YES to SB0300 recognized that, in HOA-ville, USA, when it comes to your property rights, you’re either a Winner or a Loser. And when you’re on the losing side of an issue, your property rights don’t matter.

Thankfully, 39 Senators and 73 House Representatives voted for private property rights for all members of an HOA, protecting the rights of the minority as well as the majority. ♦♦