Ask the HOA Expert: Can a Board Control The Tenant Approval Process From Owners?

Written by Richard Thompson Posted On Thursday, 06 July 2023 00:00

Question: Can a board require unit owners to have background check conducted on their renters and control the tenant approval process?

Answer: The board has no direct legal authority over renters. The board has the right to require that all rental agreements are subject to the HOA's rules and regulations and that the landlord be responsible for enforcing renter violations. If the landlord fails to enforce the HOA rules on his tenant(s), the board can invoke whatever penalty the written policy describes as if he violated the rule himself.

The board does not have the authority to screen renters or prospective purchasers unless there is specific authority to do so in the governing documents (very rare). Even if that authority exists, the board needs to be very careful not to violate federal fair housing laws which prohibit discrimination based on race, color, national origin, religion, sex, familial status or handicap. Essentially, financial criteria needs to the main basis for screening although criminal history and physical abuse of previous rentals is a valid basis. But the unit owner is the one that is responsible for checking these things out and to decide what criteria a renter should have.

Question: The directors of our board serve as unpaid volunteers. It's difficult to get others to volunteer for these positions, so the current board has been there for years. Are there any rules or guidelines for compensating board members?

Answer: Most governing documents prohibit compensation for the board and committees. Even if not prohibited, it's strongly recommended not to due to an unavoidable conflict of interest.

While volunteer work can be taxing at times, the "volunteer" aspect is extremely important to the outcome. Once the board is paid, outcomes will change and not necessarily for the better. Self compensation has a way of growing over time. If the board needs help to run the HOA, it should hire a management company and have all members share in the cost.

Question: Our bylaws state that if an owner wishes to rent their unit, they must first obtain written permission from the board. We have two units that, as it turns out, are unauthorized rental units. What is the best way to proceed?

Answer: A local title insurance company can provide you the names and mailing addresses of the unit owners of record so you can inform them of the illegal rentals. But since the tenants have probably already moved in, I'm not sure what you can do to the owners now other than threaten legal action. The tenants probably have a written leases and are protected under state Landlord Tenant law.

If the board feels strongly about controlling rentals, there needs to be a comprehensive Rental Policy enacted which outlines the procedure for getting permission, the penalty for violation and an appeal process. See Resolution Process section for suggested formatting. Restricting rentals is a highly controversial issue in HOAs and the board should never adopt any policy that has not been thoroughly discussed and supported by a large majority of the members. To ensure it complies with state and federal fair housing laws, run any proposed policy passed a knowledge HOA attorney.

Question: The board recently had a beautiful 20 year old flowering tree cut down behind my unit and never informed anyone of the plan. When I inquired about it, I was told that it blocked a sprinkler head. It seems to me that sprinkler heads are easy to move but growing trees are not. I'm distressed about this.

Answer: From what you describe, the board acted rashly. Tree removal is a highly political issue. Unless there is immediate danger posed like with storm damage, residents (especially those directly impacted) should always be informed and given a chance for input.

While the board does have the authority to make tree removal decisions, this board needs a big lesson in diplomacy and common sense. If the board ramrods over this issue, what other issues are being ramrodded through.

There are several things you can do.

  1. Get a petition signed by as many unit owners as possible. The petition should state that non-emergency tree removals must be noticed to all owners within, say, 300 feet and they must be given 30 days to give input prior to the board finalizing a decision. Since this approach is entirely reasonable and virtually all non-board members are likely to support it, you should have little problem getting most unit owners to sign the petition.
  2. Offer to form and serve on a Grounds Committee. The board can then assign special landscaping and tree issues to the committee for review and recommendations.
  3. Run for the board. If successful, you can bring common sense to the board and hopefully derail rash decisions like this one.

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