Guest Column

Why Are Legislators Considering Such a Harmful State Bill?

SB 300 makes the definition of an HOA illogical and is a recipe for a litigious battle

As a community manager for two homeowner associations (HOAs) in Whitefish, I am shocked that SB 300 legislation is being considered by our state legislators. SB 300 will negatively affect the residents of my communities. There are 375 property owners in the communities I manage, and I expect them to be cared for and considered at all levels of governance.

The sole purpose of an HOA is defined by its ability act on behalf of the greater good of a community to maintain, preserve and enhance property values. SB 300 makes the definition of an HOA illogical. In addition, the bill is a recipe for a litigious battle in which non-profit HOAs and their members are not prepared. This misguided bill was not thoughtfully considered for the greater good of Montana’s residents. Here are a few current examples of how it will negatively impact the two associations I manage.

The Monterra at Whitefish Condominium is one of 22 condo associations in Montana that has worked arduously to be project-certified by the U.S. Housing and Urban Development (HUD). The Monterra HOA’s financial stability depends on ensuring our owners lending so we must comply with HUDs increased requirements. Fannie Mae & Freddie Mac are also more scrutinous these days of HOA covenants, ensuring property values are protected. Our Board of Directors is planning to amend the HOAs covenants to comply, but SB 300 jeopardizes these needed changes and the financial stability of this community.

The Lakes Master HOA consists of 208 property owners with seven distinct sub-associations, and each of them have their own set of Conditions, Covenants & Restrictions (CCR’s). The original developer turned the association over in 2007, early in its development. Unfortunately, we were handed governing documents with inconsistencies, ambiguities and contradictions. The Lakes Board of Directors is currently in the process of making changes to our covenants to fix these issues. We are working with our legal counsel and our membership to make sure the improvements benefit the whole community and protect home values.

If SB 300 is adopted, the Lakes Master HOA will not be able to make the necessary changes to its documents to clarify and preserve the integrity of the governance that residents contractually entered when purchasing in the association, since they have no way of enforcing the changes.

As an industry professional, prudent, responsible and inclusive governance is the driving force, with an end goal to preserve the integrity of the communities and value of the properties we serve. The ability to make changes as a community ages, grows and evolves is essential to our goals.

One single homeowner that doesn’t like a rule adopted by all of their neighbors is the reason behind SB 300. It is not surprising that the list of Montanans that oppose SB 300 is extensive. As SB 300 hurries through legislation without the support of any HOA, community management company, or trade association, one is left to wonder why?

Karley Connolly is homeowners association manager of the The Monterra at Whitefish Condominium Assoc., Inc.