Overview
A proposal to amend A.R.S. §§ 33-1242 and 33-1803 to impose statutory damages against an association if the association attempts to enforce any provision of the declaration, bylaws, or rules that is “prohibited by law.” Damages are tiered and increase for each attempt to enforce: $1,000, $10,000, and $100,000 thereafter.
Key Changes
Proposed Amendment (Inactive)
The proposed bill would establish statutory damages against associations that attempt to enforce provisions prohibited by law:
- First Attempt: $1,000 statutory damages
- Second and Subsequent Attempts: $2,500 statutory damages per attempt
These penalties would apply when an association attempts to enforce any provision of the declaration, bylaws, or rules that is prohibited by law.
Note: The original bill proposed escalating penalties of $1,000, $10,000, and $100,000. The amendment modified this to $1,000 for the first attempt and $2,500 for each subsequent attempt.
Legislative Timeline
- March 20, 2025: Held in Senate Committee on Regulatory Affairs and Government Efficiency
- March 11, 2025: Senate Second Read
- March 10, 2025: Senate First Read; Assigned to Senate Committee on Regulatory Affairs and Government Efficiency and Senate Committee on Rules
- March 3, 2025: House Third Read; Passed 33-25-2 and transmitted to Senate
- February 26, 2025: “Do Pass Amended” recommendation by House Committee of the Whole
- February 24, 2025: Passed out of House Committee on Rules with a “Constitutional and Proper” determination
- February 18, 2025: Passed out of House Committee on Commerce with a “Do Pass as Amended” recommendation; Amendment proposed by Rep. Michael Way modified penalties to $1,000 for first attempt and $2,500 for subsequent attempts
- February 14, 2025: On February 18, 2025 agenda for House Committee on Commerce
- February 13, 2025: House Second Read
- February 12, 2025: House First Read; Assigned to House Committee on Commerce and House Committee on Rules
Impact
For Condominiums and Planned Communities
This bill would significantly impact association enforcement practices by creating financial penalties for attempting to enforce provisions that are prohibited by law. Associations would need to carefully review all enforcement actions to ensure compliance with current statutes before taking action. The penalty structure creates substantial financial risk for associations that attempt to enforce outdated or legally prohibited provisions, even if done inadvertently. Boards and management companies would need to conduct thorough legal reviews of governing documents and enforcement policies to identify any provisions that may be prohibited by law.