A.R.S. tit. 33 ch. 16 — Arizona Revised Statutes Title 33 Chapter 16 — Planned Communities

33-1801. Applicability; exemptions; voluntary election to be subjected to chapter A. This chapter applies to all planned communities. B. Notwithstanding any provisions in the community documents, this chapter does not apply to any school that receives monies from this state, including a charter school, and a school is exempt from regulation or any enforcement action by any homeowners' association that is subject to this chapter. With the exception of homeschools as defined in section 15-802, schools shall not be established within the living units of a homeowners' association. The homeowners' association may enter into a contractual agreement with a school district or charter school to allow use of the homeowners' association's common areas by the school district or charter school. C. This chapter does not apply to either of the following: 1. Timeshare plans or associations that are subject to chapter 20 of this title. 2. Notwithstanding any provision in the community documents, a nonprofit corporation or unincorporated association of owners that is created or incorporated before January 1, 1974 and that does not have authority to enforce covenants, conditions and restrictions related to the use, occupancy or appearance of the separately owned lots, parcels or units in a real estate development, unless a majority of all the members of such a nonprofit corporation or unincorporated association of owners elect in writing to subject the corporation or association to this chapter by recording a notice of election pursuant to subsection D of this section. D. A nonprofit corporation or unincorporated association of owners that has the power under recorded covenants to assess members to pay the costs and expenses incurred in the performance of obligations created by recorded covenants for a real estate development that does not qualify as a planned community may elect to subject the nonprofit corporation or unincorporated association of owners to this chapter with the written approval of a majority of all the members. A notice of election to be subject to this chapter shall be recorded by the nonprofit corporation or unincorporated association of owners with the county recorder of the county or counties in which the real estate development is located. The notice is effective as of the date of the recording of the notice. Any such election may be rescinded in the same manner as an election and is effective as of the date of the recording of the notice of rescission. 33-1802. Definitions In this chapter and in the community documents, unless the context otherwise requires: 1. "Association": (a) Means a nonprofit corporation or unincorporated association of owners that is created pursuant to a declaration to own and operate portions of a planned community and that has the power under the declaration to assess association members to pay the costs and expenses incurred in the performance of the association's obligations under the declaration. (b) Does not include a nonprofit corporation or unincorporated association of owners that is created or incorporated before January 1, 1974 and that does not have authority to enforce covenants, conditions or restrictions related to the use, occupancy or appearance of the separately owned lots, parcels or units in a real estate development, unless the nonprofit corporation or unincorporated association of owners elects to be subject to this chapter pursuant to section 33-1801, subsection D. 2. "Common expense lien" means the lien for assessments, charges for late payment of assessments if authorized in the declaration, reasonable collection fees and costs incurred or applied by the association and reasonable attorney fees and costs that are incurred with respect to those assessments, if the attorney fees and costs are awarded by a court. 3. "Community documents" means the declaration, bylaws, articles of incorporation, if any, and rules, if any. 4. "Declaration" means any instruments, however denominated, that establish a planned community and any amendment to those instruments. 5. "Member expenses": (a) Means fees, charges, late charges and monetary penalties or interest. (b) Does not include any amount that is included in a common expense lien. 6. "Planned community": (a) Means a real estate development that includes real estate owned and operated by or real estate on which an easement to maintain roadways or a covenant to maintain roadways is held by a nonprofit corporation or unincorporated association of owners, that is created for the purpose of managing, maintaining or improving the property and in which the declaration expressly states both that the owners of separately owned lots, parcels or units are mandatory members and that the owners are required to pay assessments to the association for these purposes. (b) Does not include any of the following: (i) A timeshare plan or a timeshare association that is governed by chapter 20 of this title. (ii) A condominium that is governed by chapter 9 of this title. (iii) A real estate development that is not managed or maintained by an association. 33-1803. Assessment limitation; penalties; notice to member of violation A. Unless limitations in the community documents would result in a lower limit for the assessment, the association shall not impose a regular assessment that is more than twenty percent greater than the immediately preceding fiscal year's assessment without the approval of the majority of the members of the association. Unless reserved to the members of the association, the board of directors may impose reasonable charges for the late payment of assessments. A payment by a member is deemed late if it is unpaid fifteen or more days after its due date, unless the community documents provide for a longer period. Charges for the late payment of assessments are limited to the greater of fifteen dollars or ten percent of the amount of the unpaid assessment and may be imposed only after the association has provided notice that the assessment is overdue or provided notice that the assessment is considered overdue after a certain date. Any monies paid by the member for an unpaid assessment shall be applied first to the principal amount unpaid and then to the interest accrued. B. After notice and an opportunity to be heard, the board of directors may impose reasonable monetary penalties on members for violations of the declaration, bylaws and rules of the association. Notwithstanding any provision in the community documents, the board of directors shall not impose a charge for a late payment of a penalty that exceeds the greater of fifteen dollars or ten percent of the amount of the unpaid penalty. A payment is deemed late if it is unpaid fifteen or more days after its due date, unless the declaration, bylaws or rules of the association provide for a longer period. Any monies paid by a member for an unpaid penalty shall be applied first to the principal amount unpaid and then to the interest accrued. Notice pursuant to this subsection shall include information pertaining to the manner in which the penalty shall be enforced. C. A member who receives a written notice that the condition of the property owned by the member is in violation of the community documents without regard to whether a monetary penalty is imposed by the notice may provide the association with a written response by sending the response by certified mail within twenty-one calendar days after the date of the notice. The response shall be sent to the address identified in the notice. D. Within ten business days after receipt of the certified mail containing the response from the member, the association shall respond to the member with a written explanation regarding the notice that shall provide at least the following information unless previously provided in the notice of violation: 1. The provision of the community documents that has allegedly been violated. 2. The date of the violation or the date the violation was observed. 3. The first and last name of the person or persons who observed the violation. 4. The process the member must follow to contest the notice. E. Unless the information required in subsection D, paragraph 4 of this section is provided in the notice of violation, the association shall not proceed with any action to enforce the community documents, including the collection of attorney fees, before or during the time prescribed by subsection D of this section regarding the exchange of information between the association and the member and shall give the member written notice of the member's option to petition for an administrative hearing on the matter in the state real estate department pursuant to section 32-2199.01. At any time before or after completion of the exchange of information pursuant to this section, the member may petition for a hearing pursuant to section 32-2199.01 if the dispute is within the jurisdiction of the state real estate department as prescribed in section 32-2199.01. 33-1804. Open meetings; exceptions; notice; agenda; policy statement A. Notwithstanding any provision in the declaration, bylaws or other documents to the contrary, all meetings of the members' association and the board of directors, and any regularly scheduled committee meetings, are open to all members of the association or any person designated by a member in writing as the member's representative and all members or designated representatives so desiring shall be allowed to attend and speak at an appropriate time during the deliberations and proceedings. The board may place reasonable time restrictions on those persons speaking during the meeting but shall allow a member or member's designated representative to speak once after the board has discussed a specific agenda item but before the board takes formal action on that item in addition to any other opportunities to speak. The board shall provide for a reasonable number of persons to speak on each side of an issue. Persons attending may audiotape or videotape those portions of the meetings of the board of directors and meetings of the members that are open. The board of directors of the association shall not require advance notice of the audiotaping or videotaping and may adopt reasonable rules governing the audiotaping and videotaping of open portions of the meetings of the board and the membership, but such rules shall not preclude such audiotaping or videotaping by those attending, unless the board audiotapes or videotapes the meeting and makes the unedited audiotapes or videotapes available to members on request without restrictions on their use as evidence in any dispute resolution process. If a board records a meeting that is open to the members, the board shall keep a copy of the recording for at least six months and make the unedited recording available to any member on request in compliance with section 33-1805, subsection A. Any portion of a meeting may be closed only if that closed portion of the meeting is limited to consideration without action of one or more of the following: 1. Legal advice from an attorney for the board or the association. On final resolution of any matter for which the board received legal advice or that concerned pending or contemplated litigation, the board may disclose information about that matter in an open meeting except for matters that are required to remain confidential by the terms of a settlement agreement or judgment. 2. Pending or contemplated litigation. 3. Personal, health or financial information about an individual member of the association, an individual employee of the association or an individual employee of a contractor for the association, including records of the association directly related to the personal, health or financial information about an individual member of the association, an individual employee of the association or an individual employee of a contractor for the association. 4. Matters relating to the job performance of, compensation of, health records of or specific complaints against an individual employee of the association or an individual employee of a contractor of the association who works under the direction of the association. 5. Discussion of a member's appeal of any violation cited or penalty imposed by the association except on request of the affected member that the meeting be held in an open session. B. Notwithstanding any provision in the community documents, all meetings of the members' association and the board shall be held in this state. A meeting of the members' association shall be held at least once each year. Special meetings of the members' association may be called by the president, by a majority of the board of directors or by members having at least twenty-five percent, or any lower percentage specified in the bylaws, of the votes in the association. Not fewer than ten or more than fifty days in advance of any meeting of the members the secretary shall cause notice to be hand delivered or sent prepaid by United States mail to the mailing address for each lot, parcel or unit owner or to any other mailing address designated in writing by a member. The notice shall state the date, time and place of the meeting. A notice of any annual, regular or special meeting of the members shall also state the purpose for which the meeting is called, including the general nature of any proposed amendment to the declaration or bylaws, changes in assessments that require approval of the members and any proposal to remove a director or an officer. The secretary shall also provide an agenda for any meeting of the members' association by hand delivery, mail, website posting, email or other electronic means or posting at a community center or other similar location. The failure of any member to receive actual notice of a meeting of the members or the meeting agenda does not affect the validity of any action taken at that meeting. C. Before entering into any closed portion of a meeting of the board of directors, or on notice of a meeting under subsection D of this section that will be closed, the board shall identify the paragraph under subsection A of this section that authorizes the board to close the meeting. D. Notwithstanding any provision in the declaration, bylaws or other community documents, for meetings of the board of directors that are held after the termination of declarant control of the association, notice to members of meetings of the board of directors and meeting agendas shall be given at least forty-eight hours in advance of the meeting by newsletter, conspicuous posting or any other reasonable means as determined by the board of directors. An affidavit of notice by an officer of the corporation is prima facie evidence that notice was given as prescribed by this section. Notice to members of meetings of the board of directors is not required if emergency circumstances require action by the board before notice can be given. Any notice of a board meeting shall state the date, time and place of the meeting. The failure of any member to receive actual notice of a meeting of the board of directors or a meeting agenda does not affect the validity of any action taken at that meeting. E. Notwithstanding any provision in the declaration, bylaws or other community documents, for meetings of the board of directors that are held after the termination of declarant control of the association, all of the following apply: 1. The agenda shall be available in advance for all members attending. 2. An emergency meeting of the board of directors may be called to discuss business or take action that cannot be delayed for the forty-eight hours required for notice. At any emergency meeting called by the board of directors, the board of directors may act only on emergency matters. The minutes of the emergency meeting shall state the reason necessitating the emergency meeting. The minutes of the emergency meeting shall be read and approved at the next regularly scheduled meeting of the board of directors. 3. A quorum of the board of directors may meet by means of a telephone conference if a speakerphone is available in the meeting room that allows board members and association members to hear all parties who are speaking during the meeting. 4. Any quorum of the board of directors that meets informally to discuss association business, including workshops, shall comply with the open meeting and notice provisions of this section without regard to whether the board votes or takes any action on any matter at that informal meeting. F. It is the policy of this state as reflected in this section that all meetings of a planned community, whether meetings of the members' association or meetings of the board of directors of the association, be conducted openly and that notices and agendas be provided in advance for those meetings that contain the information that is reasonably necessary to inform the members of the matters to be discussed or decided and to ensure that members have the ability to speak after discussion of agenda items, but before a vote of the board of directors or members is taken. Toward this end, any person or entity that is charged with the interpretation of these provisions, including members of the board of directors and any community manager, shall take into account this declaration of policy and shall construe any provision of this section in favor of open meetings. 33-1805. Association financial and other records A. Except as provided in subsection B of this section, all financial and other records of the association shall be made reasonably available for examination by any member or any person designated by the member in writing as the member's representative. The association shall not charge a member or any person designated by the member in writing for making material available for review. The association shall have ten business days to fulfill a request for examination. On request for purchase of copies of records by any member or any person designated by the member in writing as the member's representative, the association shall have ten business days to provide copies of the requested records. An association may charge a fee for making copies of not more than fifteen cents per page. B. Books and records kept by or on behalf of the association and the board may be withheld from disclosure to the extent that the portion withheld relates to any of the following: 1. Privileged communication between an attorney for the association and the association. 2. Pending litigation. 3. Meeting minutes or other records of a session of a board meeting that is not required to be open to all members pursuant to section 33-1804. 4. Personal, health or financial records of an individual member of the association, an individual employee of the association or an individual employee of a contractor for the association, including records of the association directly related to the personal, health or financial information about an individual member of the association, an individual employee of the association or an individual employee of a contractor for the association. 5. Records relating to the job performance of, compensation of, health records of or specific complaints against an individual employee of the association or an individual employee of a contractor of the association who works under the direction of the association. C. The association shall not be required to disclose financial and other records of the association if disclosure would violate any state or federal law. 33-1806. Sale of properties; information required; fees; civil penalty; applicability; definition A. For planned communities with fewer than fifty properties, a member shall electronically transmit or deliver to a purchaser or a purchaser's designated agent the information required by this subsection within ten days after acceptance of the purchaser's offer to purchase. For planned communities with fifty or more properties, the member shall provide a written notice to the association of the member's acceptance of the purchaser's offer to purchase that contains the name, email address and mailing address of the purchaser or the purchaser's designated agent. The association shall electronically transmit or deliver to the purchaser or the purchaser's designated agent within ten days after receipt of the written notice of a pending purchase offer all of the following in either paper or electronic format: 1. A copy of the current bylaws and the current rules of the association. 2. A copy of the current declaration and final plat or an electronic copy of the final plat, if available. 3. A copy of the board-approved minutes for the previous three open meetings of the board of directors. 4. A dated statement containing: (a) The telephone number and address of a principal contact for the association, which may be an association manager, an association management company, an officer of the association or any other person designated by the board of directors. (b) The amount of and payment schedule for the annual common regular assessment and the remaining installments and payment schedules on any approved and assessed special assessment, if any. (c) The amount and purpose of any special assessment approved by the board of directors but not yet assessed or any special assessment submitted by the board for member approval within the previous four months, if any. (d) The current amount of any unpaid common regular assessment lien or judgment lien on the property due to the association pursuant to section 33-1807 and any lis pendens recorded by the association against the property. (e) The amount and purpose of any title transfer fee or other similar fee, however denominated, that is authorized in the declaration. (f) A copy of the association's most recent income and expenses financial statement for all operating and reserve accounts, as applicable. (g) Any outstanding and unresolved violation of the association's community documents that was cited against the property, if any. 5. A copy of the current operating budget of the association. 6. A copy of the most recent annual audit, review or compilation report of the association pursuant to section 33-1810. If the report is more than ten pages, a summary of the report may be provided in place of the entire report. 7. A copy of the most recent reserve study of the association, if any. If the report is more than ten pages, the association may provide a summary of the report in place of the entire report. 8. A statement summarizing any pending lawsuits, except those relating to the collection of assessments owed by members other than the selling member, in which the association is a named party, including the amount of any money claimed. 9. A statement as to whether the planned community is under declarant control and the approximate percentage of lots identified on the recorded plat that are currently owned by the declarant. 10. A statement that, for any report provided in summary format pursuant to this subsection, the purchaser may request to view the entire report from the association directly, and the association shall provide access to that report within ten days after a written request. 11. A statement to be signed by the purchaser at the close of escrow that provides "I hereby acknowledge that with the purchase of this home or property, I will be contractually bound to the valid covenants, conditions and restrictions of the recorded declaration, and will be contractually bound to pay all common expense assessments applied to my home or property as authorized in the declaration and title 33, chapter 9 or 16, Arizona Revised Statutes, as applicable. If I fail to pay common expense assessments, I may be subject to collection activity by the association up to and including foreclosure action, without the equity protection of the homestead act pursuant to title 33, chapter 8, Arizona Revised Statutes." 12. If the property is governed by multiple associations, a statement identifying that the property is subject to each association's disclosure report and corresponding resale disclosure fee authorized under subsection D of this section. B. All information that is provided under subsection A of this section shall be based on the good faith reliance on association records or information, without the need for independent investigation or validation. C. A purchaser or seller who is damaged by the member or the association knowingly or recklessly failing to disclose the information required by subsection A of this section or knowingly or recklessly providing materially false or misleading statements in the disclosure may pursue all remedies at law or in equity against the member or the association, whichever failed to comply with subsection A of this section, including the recovery of reasonable attorney fees as awarded by the court. D. The association may charge the member a fee of not more than an aggregate of $400 to compensate the association for the costs incurred in the preparation and delivery of a report or other documents furnished by the association pursuant to this section for purposes of resale disclosure, lien estoppel and any other services related to the transfer or use of the property. In addition, the association may charge a rush fee of not more than $100 if the rush services are required to be performed within seventy-two hours after the request for rush services. The member may request the association to update the report if thirty days or more have passed since the date of the original disclosure report. The association may charge a document update fee of not more than $50. The association shall make available to any interested party the amount of any fee established from time to time by the association. The association may charge the same fee without regard to whether the association is furnishing the statement or other documents in paper or electronic format. E. The fees prescribed by this section shall be collected not earlier than at the close of escrow and may only be charged once to a member for that transaction between the parties. An association shall not charge or collect a fee relating to services for resale disclosure, lien estoppel and any other services related to the transfer or use of a property except as specifically authorized in this section. An association that charges or collects a fee in violation of this section is subject to a civil penalty of not more than $1,200. F. This section applies to a managing agent for an association that is acting on behalf of the association. G. The following are exempt from this section: 1. A sale in which a public report is issued pursuant to section 32-2183 or 32-2197.02. 2. A sale pursuant to section 32-2181.02. 3. A conveyance by recorded deed that bears an exemption listed in section 11-1134, subsection B, paragraph 3 or 7. On recordation of the deed, the purchaser shall provide the association with the changes in ownership, including the member's name, billing address and phone number. Failure to provide the information shall not prevent the member from qualifying for the exemption pursuant to this section. H. For the purposes of this section, unless the context otherwise requires, "member": 1. Means the seller of the property title. 2. Does not include: (a) Any real estate salesperson or real estate broker who is licensed under title 32, chapter 20 and who is acting as a salesperson or broker. (b) Any escrow agent who is licensed under title 6, chapter 7 and who is acting as an escrow agent. (c) A trustee of a deed of trust who is selling the property in a trustee's sale pursuant to chapter 6.1 of this title. 33-1806.01. Rental property; member and agent information; fee; disclosure A. A member may use the member's property as a rental property unless prohibited in the declaration and shall use it in accordance with the declaration's rental time period restrictions. B. A member may designate in writing a third party to act as the member's agent with respect to all association matters relating to the rental property, except for voting in association elections and serving on the board of directors. The member shall sign the written designation and shall provide a copy of the written designation to the association. On delivery of the written designation, the association is authorized to conduct all association business relating to the member's rental property through the designated agent. Any notice given by the association to a member's designated agent on any matter relating to the member's rental property constitutes notice to the member. C. Notwithstanding any provision in the community documents, on rental of a member's property an association shall not require a member or a member's agent to disclose any information regarding a tenant other than the name and contact information for any adults occupying the property, the time period of the lease, including the beginning and ending dates of the tenancy, and a description and the license plate numbers of the tenants' vehicles. If the planned community is an age restricted community, the member, the member's agent or the tenant shall show a government issued identification that bears a photograph and that confirms that the tenant meets the community's age restrictions or requirements. D. On request of an association or its managing agent for the disclosures prescribed in subsection C of this section, the managing agent or, if there is no managing agent, the association may charge a fee of not more than twenty-five dollars, which shall be paid within fifteen days after the postmarked request. The fee may be charged for each new tenancy for that property but may not be charged for a renewal of a lease. Except for the fee permitted by this subsection and fees related to the use of recreational facilities, the association or its managing agent shall not assess, levy or charge a fee or fine or otherwise impose a requirement on a member's rental property any differently than on an owner-occupied property in the association. E. Notwithstanding any provision in the community documents, the association is prohibited from doing any of the following: 1. Requiring a member to provide the association with a copy of the tenant's rental application, credit report, lease agreement or rental contract or other personal information except as prescribed by this section. This paragraph does not prohibit the association from acquiring a credit report on a person in an attempt to collect a debt. 2. Requiring the tenant to sign a waiver or other document limiting the tenant's due process rights as a condition of the tenant's occupancy of the rental property. 3. Prohibiting or otherwise restricting a member from serving on the board of directors based on the member's not being an occupant of the property. 4. Imposing on a member or managing agent any fee, assessment, penalty or other charge in an amount greater than fifteen dollars for incomplete or late information regarding the information requested pursuant to subsection C of this section. F. Any attempt by an association to exceed the fee, assessment, penalty or other charge authorized by subsection D or E of this section voids the fee, assessment, penalty or other charge authorized by subsection D or E of this section. This section does not prevent an association from complying with the housing for older persons act of 1995 (P.L. 104–76; 109 Stat. 787). G. An owner may use a crime free addendum as part of a lease agreement. This section does not prohibit the owner's use of a crime free addendum. H. This section does not prohibit and an association may lawfully enforce a provision in the community documents that restricts the residency of persons who are required to be registered pursuant to section 13-3821 and who are classified as level two or level three offenders. I. An owner of rental property shall abate criminal activity as authorized in section 12-991. 33-1807. Common expense liens; priority; mechanics' and materialmen's liens; notice A. The association has a common expense lien on a property for any assessment levied against that property from the time the assessment becomes due. The association's common expense lien may be foreclosed in the same manner as a mortgage on real estate but may be foreclosed only if the owner has been and remains delinquent in the payment of any assessment or portion of the assessment for a period of eighteen months or in the amount of $10,000 or more, whichever occurs first, as determined on the date the action is filed. For any special assessment with an initial value of $10,000 or more, only the eighteen-month delinquency threshold applies. The association board of directors shall exercise reasonable efforts to communicate with the member and offer a reasonable payment plan before filing a foreclosure action. If an assessment is payable in installments, the full amount of the assessment is a common expense lien from the time the first installment of the assessment becomes due. B. Notwithstanding any provision in the community documents, member expenses are not enforceable as common expense liens under this section. The association has a judgment lien for member expenses after the entry of a judgment in a civil suit for those member expenses from a court of competent jurisdiction and the recording of that judgment in the office of the county recorder as otherwise provided by law. The association's judgment lien for member expenses may not be foreclosed and is effective only on conveyance of any interest in the real property. C. A common expense lien under this section is prior to all other liens, interests and encumbrances on a property except: 1. Liens and encumbrances recorded before the recordation of the declaration. 2. A recorded first mortgage on the property, a seller's interest in a first contract for sale pursuant to chapter 6, article 3 of this title on the property recorded before the common expense lien arising pursuant to subsection A of this section or a recorded first deed of trust on the property. 3. Liens for real estate taxes and other governmental assessments or charges against the property. D. Subsection C of this section does not affect the priority of mechanics' or materialmen's liens. The common expense lien under this section is not subject to chapter 8 of this title. E. Unless the declaration otherwise provides, if two or more associations have common expense liens created at any time on the same real estate those common expense liens have equal priority. F. Recording the declaration constitutes record notice and perfection of the common expense lien. Further recordation of any claim of common expense lien under this section is not required. G. A common expense lien is extinguished unless proceedings to enforce the common expense lien are instituted within six years after the full amount of the assessment becomes due. H. This section does not prohibit: 1. Actions to recover amounts for which subsection A or B of this section creates a lien. 2. An association from taking a deed in lieu of foreclosure. I. A judgment or decree in any action brought under this section may include costs and reasonable attorney fees for the prevailing party. J. On written request, the association shall furnish to a lienholder, escrow agent, member or person designated by a member a statement setting forth the amount of any unpaid liens prescribed by subsection A or B of this section against the property. The association shall furnish the statement within ten days after receipt of the request. The statement is binding on the association if the statement is requested by an escrow agency that is licensed pursuant to title 6, chapter 7. Failure to provide the statement to the escrow agent within the time provided for in this subsection extinguishes any lien for any unpaid assessment then due. K. Notwithstanding any provision in the community documents or in any contract between the association and a management company or any other agent of the association, including any agreement or contract with any attorney, unless the member directs otherwise, all payments received on a member's account shall be applied first to any unpaid assessments, due but not delinquent assessments, unpaid charges for late payment of those assessments if authorized in the declaration, unpaid reasonable collection fees and costs incurred or applied by the association, and unpaid attorney fees and costs incurred with respect to those assessments if awarded by a court, in that order, with any remaining amounts applied next to other unpaid fees, charges and monetary penalties or interest and late charges on any of those amounts. L. For a delinquent account for unpaid common expense liens, the association shall provide the following written notice to the member at the member's address as provided to the association at least thirty days before authorizing an attorney, or a collection agency that is not acting as the association's managing agent, to begin collection activity on behalf of the association: Your account is delinquent. If you do not bring your account current or make arrangements that are approved by the association to bring your account current within thirty days after the date of this notice, your account will be turned over for further collection proceedings. Such collection proceedings could include bringing a foreclosure action against your property. The notice shall be in bold-faced type or all capital letters and shall include the contact information for the person that the member may contact to discuss payment. The notice shall be sent by certified mail, return receipt requested, and may be included within other correspondence sent to the member regarding the member's delinquent account. M. Except for planned communities that have fewer than fifty lots and that do not contract with a third party to perform management services on behalf of the association, the association shall provide a statement of account in lieu of a periodic payment book to the member with the same frequency that assessments are provided for in the declaration. The statement of account shall include the current account balance due and the immediately preceding ledger history. If the association offers the statement of account by electronic means, a member may opt to receive the statement electronically. The association may stop providing any further statements of account to a member if collection activity begins by an attorney, or a collection agency that is not acting as the association's managing agent, regarding that member's unpaid account. After collection activity begins, a member may request statements of account by written request to the attorney or collection agency. Any request by a member for a statement of account after collection activity begins by an attorney or a collection agency that is not acting as the association's managing agent must be fulfilled by the attorney or the collection agency responsible for the collection. The statement of account provided by the attorney or collection agency responsible for the collection shall include all amounts claimed to be owing to resolve the delinquency through the date set forth in the statement, including attorney fees and costs, regardless of whether such amounts have been reduced to judgment. N. An agent for the association may collect on behalf of the association directly from a member the assessments and other amounts owed by cash or check, by mailed or hand-delivered bank drafts, checks, cashier's checks or money orders, by credit, charge or debit card or by other electronic means. For any form of payment other than for cash or for mailed or hand-delivered bank drafts, checks, cashier's checks or money orders, the agent may charge a convenience fee to the member that is approximately the amount charged to the agent by a third-party service provider. O. The association may not transfer ownership or control of debt for common expense liens or member expenses. 33-1808. Flag display; political signs; caution signs; for sale, rent or lease signs; political and community activities; definitions A. Notwithstanding any provision in the community documents, an association shall not prohibit the outdoor front yard or backyard display of any of the following: 1. The American flag or an official or replica of a flag of the uniformed services of the United States, including a division flag of the army, navy, marine corps, air force, space force or coast guard, by an association member on that member's property if the American flag or a uniformed services flag is displayed in a manner consistent with the federal flag code (P.L. 94-344; 90 Stat. 810; 4 United States Code sections 4 through 10). 2. The POW/MIA flag. 3. The Arizona state flag. 4. An Arizona Indian nations flag. 5. The Gadsden flag. 6. A first responder flag. A first responder flag may incorporate the design of one or two other first responder flags to form a combined flag. 7. A blue star service flag or a gold star service flag. 8. Any historic version of the American flag, including the Betsy Ross flag, without regard to how the stars and stripes are arranged on the flag. 9. A flag from a nation that is allied with the United States as a major non-NATO ally and that was established on May 14, 1948. B. The association shall adopt reasonable rules and regulations regarding the placement and manner of display of the flags prescribed by subsection A of this section. The association rules: 1. May regulate the location and size of flagpoles. 2. May limit the member to two wall-mounted flagpole holders. 3. May limit the member to displaying not more than two flags at once. 4. May limit the height of the flagpole to not more than the height of the rooftop of the member's home. 5. Shall not prohibit installing a flagpole in the front yard or backyard of the member's property. C. Notwithstanding any provision in the community documents, an association shall not prohibit the indoor or outdoor display of a political sign by an association member on that member's property, except that an association may prohibit the display of political signs as follows: 1. Earlier than seventy-one days before the day of a primary election. 2. Later than fifteen days after the day of the general election. 3. For a sign for a candidate in a primary election who does not advance to the general election, later than fifteen days after the primary election. D. An association may regulate the size and number of political signs that may be placed on a member's property if the association's regulation is not more restrictive than any applicable city, town or county ordinance that regulates the size and number of political signs on residential property. If the city, town or county in which the property is located does not regulate the size and number of political signs on residential property, the association shall not limit the number of political signs, except that the maximum aggregate total dimensions of all political signs on a member's property shall not exceed nine square feet. E. Notwithstanding any provision in the community documents, an association shall not prohibit using cautionary signs regarding children if the signs are used and displayed as follows: 1. The signs are displayed in residential areas only. 2. The signs are removed within one hour of children ceasing to play. 3. The signs are displayed only when children are actually present within fifty feet of the sign. 4. The temporary signs are not taller than three feet in height. 5. The signs are professionally manufactured or produced. F. Notwithstanding any provision in the community documents, an association shall not prohibit children who reside in the planned community from engaging in recreational activity on residential roadways that are under the jurisdiction of the association and on which the posted speed limit is twenty-five miles per hour or less. G. Notwithstanding any provision in the community documents, an association shall not prohibit or charge a fee for the use of, the placement of or the indoor or outdoor display of a for sale, for rent or for lease sign and a sign rider by an association member on that member's property in any combination, including a sign that indicates the member is offering the property for sale by owner. The size of a sign offering a property for sale, for rent or for lease shall be in conformance with the industry standard size sign, which shall not exceed eighteen by twenty-four inches, and the industry standard size sign rider, which shall not exceed six by twenty-four inches. This subsection applies only to a commercially produced sign, and an association may prohibit using signs that are not commercially produced. With respect to real estate for sale, for rent or for lease in the planned community, an association shall not prohibit in any way other than as is specifically authorized by this section or otherwise regulate any of the following: 1. Temporary open house signs or a member's for sale sign. The association shall not require the use of particular signs indicating an open house or real property for sale and may not further regulate the use of temporary open house or for sale signs that are industry standard size and that are owned or used by the seller or the seller's agent. 2. Open house hours. The association may not limit the hours for an open house for real estate that is for sale in the planned community, except that the association may prohibit an open house being held before 8:00 a.m. or after 6:00 p.m. and may prohibit open house signs on the common areas of the planned community. 3. An owner's or an owner's agent's for rent or for lease sign unless an association's documents prohibit or restrict leasing of a member's property. An association shall not further regulate a for rent or for lease sign or require the use of a particular for rent or for lease sign other than the for rent or for lease sign shall not be any larger than the industry standard size sign of eighteen by twenty-four inches on or in the member's property. If rental or leasing of a member's property is not prohibited or restricted, the association may prohibit an open house for rental or leasing being held before 8:00 a.m. or after 6:00 p.m. H. Notwithstanding any provision in the community documents, an association shall not prohibit door-to-door political activity, including solicitations of support or opposition regarding candidates or ballot issues, and shall not prohibit circulating political petitions, including candidate nomination petitions or petitions in support of or opposition to an initiative, referendum or recall or other political issue on property normally open to visitors within the association, except that an association may do the following: 1. Restrict or prohibit the door-to-door political activity from sunset to sunrise. 2. Require the prominent display of an identification tag for each person engaged in the activity, along with the prominent identification of the candidate or ballot issue that is the subject of the support or opposition. 3. Prohibit a person who is not accompanied by a member or resident of the planned community from entering the planned community if the planned community restricts vehicular or pedestrian access. I. A planned community shall not make any regulations regarding the number of candidates supported, the number of public officers supported or opposed in a recall or the number of propositions supported or opposed on a political sign. J. A planned community shall not require political signs to be commercially produced or professionally manufactured or prohibit the utilization of both sides of a political sign. K. Notwithstanding any provision in the community documents, an association may not prohibit or unreasonably restrict the indoor or outdoor display of an association-specific political sign by a member by placement of a sign on that member's property. An association may adopt reasonable rules regarding the placement, location and manner of display of association-specific political signs, except an association shall not do any of the following: 1. Prohibit the display of association-specific political signs between the date that the association provides written or absentee ballots to members and three days after the planned community election. 2. Limit the number of association-specific political signs, except that the association may limit the aggregate total dimensions of all association-specific political signs on a member's property to not more than nine square feet. 3. Require association-specific political signs to be commercially produced or professionally manufactured or prohibit using both sides of the sign. 4. Regulate the number of candidates supported or opposed, the number of board members supported or opposed in a recall or the number of ballot measures supported or opposed on an association-specific political sign. 5. Make any other regulations regarding the content of an association-specific political sign except that the association may prohibit using profanity and discriminatory text, images or content based on race, color, religion, sex, familial status or national origin as prescribed by federal or state fair housing laws. L. Notwithstanding any provision in the community documents, an association may not prohibit or unreasonably restrict a member's ability to peacefully assemble and use common areas of the planned community if done in compliance with reasonable restrictions for the use of that property adopted by the board of directors. An individual member or group of members may assemble to discuss matters related to the planned community, including board elections or recalls, potential or actual ballot issues or revisions to the community documents, property maintenance or safety issues or any other planned community matters. A member may invite one political candidate or one non-member guest to speak to an assembly of members about matters related to the community. The association shall not prohibit a member from posting notices regarding those assemblies of members on bulletin boards located on the common areas or within common area facilities. An assembly of members prescribed by this subsection does not constitute an official members' meeting unless the meeting is noticed and convened as prescribed in the community documents and this chapter. M. An association or managing agent that violates subsection G of this section forfeits and extinguishes the lien rights authorized under section 33-1807 against that member's property for a period of six consecutive months after the date of the violation. N. For the purposes of this section: 1. "Association-specific political sign" means a sign that supports or opposes a candidate for the board of directors, the recall of a board member or a planned community ballot measure that requires a vote of the association members. 2. "Betsy Ross flag" means a historic flag of the United States that consists of thirteen stripes alternating between red and white stripes and thirteen five-pointed white stars arranged in a circle against a blue background. 3. "Division flag" means a flag that is officially authorized by the United States army, navy, marine corps, air force, space force or coast guard to represent a division level unit, that bears the unit's approved insignia, designation or nickname and that is used for ceremonial, identification or representational purposes. 4. "First responder flag" means a flag that recognizes and honors the services of any of the following: (a) Law enforcement and that is limited to the colors blue, black and white, the words "law enforcement", "police", "officers", "first responder", "honor our", "support our" and "department" and the symbol of a generic police shield in a crest or star shape. (b) Fire departments and that is limited to the colors red, gold, black and white, the words "fire", "fighters", "F", "D", "FD", "first responder", "department", "honor our" and "support our" and the symbol of a generic Maltese Cross. (c) Paramedics or emergency medical technicians and that is limited to the colors blue, black and white, the words "first responder", "paramedic", "emergency medical", "service", "technician", "honor our" and "support our" and the symbol of a generic star of life. 5. "Political sign" means a sign or flag that attempts to influence the outcome of an election, including supporting or opposing the recall of a public officer or supporting or opposing the circulation of a petition for a ballot measure, question or proposition or the recall of a public officer. 33-1809. Parking; public service and public safety emergency vehicles; definition A. Notwithstanding any provision in the community documents, an association shall not prohibit a resident from parking a motor vehicle on a street or driveway in the planned community if the vehicle is required to be available at designated periods at the person's residence as a condition of the person's employment and either of the following applies: 1. The resident is employed by a public service corporation that is regulated by the corporation commission, an entity regulated by the federal energy regulatory commission or a municipal utility and the public service corporation or municipal utility is required to prepare for emergency deployments of personnel and equipment for repair or maintenance of natural gas, electrical, telecommunications or water infrastructure, the vehicle has a gross vehicle weight rating of twenty thousand pounds or less and is owned or operated by the public service corporation or municipal utility and the vehicle bears an official emblem or other visible designation of the public service corporation or municipal utility. 2. The resident is employed by a public safety agency, including police or fire service for a federal, state, local or tribal agency or a private fire service provider or an ambulance service provider that is regulated pursuant to title 36, chapter 21.1, and the vehicle has a gross vehicle weight rating of ten thousand pounds or less and bears an official emblem or other visible designation of that agency. B. For the purposes of this section, "telecommunications" means the transmission of information of the user's choosing between or among points specified by the user without change in the form or content of the information as sent and received. Telecommunications does not include commercial mobile radio services. 33-1810. Board of directors; annual audit Unless any provision in the planned community documents requires an annual audit by a certified public accountant, the board of directors shall provide for an annual financial audit, review or compilation of the association. The audit, review or compilation shall be completed no later than one hundred eighty days after the end of the association's fiscal year and shall be made available upon request to the members within thirty days after its completion. 33-1811. Board of directors; contracts; conflict If any contract, decision or other action for compensation taken by or on behalf of the board of directors would benefit any member of the board of directors or any person who is a parent, grandparent, spouse, child or sibling of a member of the board of directors or a parent or spouse of any of those persons, that member of the board of directors shall declare a conflict of interest for that issue. The member shall declare the conflict in an open meeting of the board before the board discusses or takes action on that issue and that member may then vote on that issue. Any contract entered into in violation of this section is void and unenforceable. 33-1812. Proxies; absentee ballots; definition A. Notwithstanding any provision in the community documents, after termination of the period of declarant control, votes allocated to a unit may not be cast pursuant to a proxy. The association shall provide for votes to be cast in person and by absentee ballot and, in addition, the association may provide for voting by some other form of delivery, including the use of e-mail and fax delivery. Notwithstanding section 10-3708 or the provisions of the community documents, any action taken at an annual, regular or special meeting of the members shall comply with all of the following if absentee ballots or ballots provided by some other form of delivery are used: 1. The ballot shall set forth each proposed action. 2. The ballot shall provide an opportunity to vote for or against each proposed action. 3. The ballot is valid for only one specified election or meeting of the members and expires automatically after the completion of the election or meeting. 4. The ballot specifies the time and date by which the ballot must be delivered to the board of directors in order to be counted, which shall be at least seven days after the date that the board delivers the unvoted ballot to the member. 5. The ballot does not authorize another person to cast votes on behalf of the member. 6. The completed ballot shall contain the name, address and signature of the person voting, except that if the community documents permit secret ballots, only the envelope shall contain the name, address and signature of the voter. 7. Ballots, envelopes and related materials, including sign-in sheets if used, shall be retained in electronic or paper format and made available for member inspection for at least one year after completion of the election. B. Votes cast by absentee ballot or other form of delivery, including the use of e-mail and fax delivery, are valid for the purpose of establishing a quorum. C. Notwithstanding subsection A of this section, an association for a timeshare plan as defined in section 32-2197 may permit votes by a proxy that is duly executed by a unit owner. D. For the purposes of this section, "period of declarant control" means the time during which the declarant or persons designated by the declarant may elect or appoint the members of the board of directors pursuant to the community documents or by virtue of superior voting power. 33-1813. Removal of board member; special meeting A. Notwithstanding any provision of the declaration or bylaws to the contrary, all of the following apply to a meeting at which a member of the board of directors, other than a member appointed by the declarant, is proposed to be removed from the board of directors: 1. The members of the association who are eligible to vote at the time of the meeting may remove any member of the board of directors, other than a member appointed by the declarant, by a majority vote of those voting on the matter at a meeting of the members. 2. The meeting of the members shall be called pursuant to this section and action may be taken only if a quorum is present. 3. The members of the association may remove any member of the board of directors with or without cause, other than a member appointed by the declarant. 4. For purposes of calling for removal of a member of the board of directors, other than a member appointed by the declarant, the following apply: (a) In an association with one thousand or fewer members, on receipt of a petition that calls for removal of a member of the board of directors and that is signed by the number of persons who are eligible to vote in the association at the time the person signs the petition equal to at least twenty-five percent of the votes in the