Condo and HOA – Avoid Invalid Budgets

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Washington condominium and homeowner associations formed before July 2018 need to be aware that the law requires all annual budgets and special assessments to be reviewed and approved by the members. Any budget or special assessment that is not provided to members for approval is invalid.

The Washington Uniform Common Interest Ownership Act (WUCIOA) became law on July 1, 2018.  It applies to associations formed after that date – and pre-existing associations whose members vote to “opt-in.”  The budget-approval portions of WUCIOA, though, apply to ALL condominium and homeowners associations in Washington, regardless of the date the association was formed. 

Thus, as of July 1, 2018, all condo and HOA budgets and special assessments must be given to the members to review and approve at a membership meeting.  If there are not enough members to establish a quorum at the noticed meeting, the budget/special assessment is deemed approved.  If a quorum is present, and the members vote to approve the budget/special assessment, it is approved.  If a quorum is present, and the members vote to disapprove the budget/special assessment, then the proposed budget/special assessment fails. In the case of a failed budget, the last properly approved budget will go into effect.

If an association is not aware of this requirement (or simply ignores it) and fails to send a board-approved, proposed budget/special assessment to members for approval, the board-approved budget/special assessment is invalid and cannot be enforced.  The association may only collect the assessments imposed under the last properly approved budget.

Don’t let your association get caught short or under budget.  Contact HLG to review your covenants, conditions, & restrictions (CC&Rs), and bylaws to make sure they are up-to-date and meet your community’s needs.

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