Verbatim from the public record. The law itself is a government work — always confirm the current version on the official source before you rely on it.
A. Except as provided in the community documents or other provisions of the
Homeowner Association Act, the board acts on behalf of the association. In the
performance of their duties, officers and members of the board shall exercise, if
appointed by the declarant, the degree of care and loyalty required of a fiduciary of the
lot owners and, if elected by the lot owners, ordinary and reasonable care free from any
undisclosed conflict of interest.
B. Within ninety days after being elected or appointed to the board, each board
member shall certify in writing to the secretary of the association that the member:
(1) has read the community documents;
(2) will work to uphold the community documents and policies to the best of
the member's ability; and
(3) will faithfully discharge the member's duties to the association.
C. A board member who does not file the written certification pursuant to Subsection
B of this section shall be suspended from the board until the member complies with
Subsection B of this section.
D. The association shall retain each board member's written certification for
inspection by lot owners for five years after the board member's election or
appointment. The failure of an association to have a board member's written
certification on file does not affect the validity of any action taken by the board or any
protections provided to board members under the:
(1) Homeowner Association Act; or
(2) Nonprofit Corporation Act [Chapter 53, Article 8 NMSA 1978], if the
association is organized under the Nonprofit Corporation Act.
E. The board or the lot owners, as provided for in the community documents, shall
adopt a budget annually. Within thirty calendar days after adoption of any proposed
budget for the association, the board shall provide a copy of the budget to all the lot
owners.
F. The board shall provide to all lot owners a statement included with a copy of the
annual budget listing all fees and fines that may be charged to a lot owner by the
association or any management company retained by the association to act on behalf of
the association, including charges for a disclosure certificate pursuant to Subsection H
of Section 47-16-12 NMSA 1978.
G. Any management contract negotiated between the board and a management
company retained by the association to act on behalf of the association shall include:
(1) a disclosure to the board of any existing relationships the management
company has with any vendor or contractor for the association from which a conflict of
interest may arise; and
(2) a list of all fees to be charged to the association or lot owners by the
management company during the term of the contract.
History: Laws 2013, ch. 122, § 7; 2019, ch. 30, § 3.
ANNOTATIONS
The 2019 amendment, effective July 1, 2019, required elected or appointed board
members to provide a written certification, and required management companies
retained by a homeowner association to provide a conflict of interest disclosure; in
Subsection A, after "ordinary and reasonable care", added "free from any undisclosed
conflict of interest"; added new Subsections B through D and redesignated former
Subsection B as Subsection E; and added Subsections F and G.
Compiler's notes. — Laws 2013, ch. 122, §§ 1 through 14 were erroneously compiled
as 47-7E-1 through 47-7E-14 NMSA 1978, and have been recompiled as 47-16-1
through 47-16-14 NMSA 1978 by the compiler.
Planned community has not yet reached the threshold required for lot owners to
elect a board member to the homeowner's association. — The Homeowner
Association Act (HOAA), 47-16-1 to 47-16-18 NMSA 1978, dictates that the period of
declarant control shall terminate, if not voluntarily terminated by the declarant sooner,
no later than the earlier of certain specific conditions, and as the percentage of lots
conveyed to lot owners increases, so too does the percentage of board members
elected by the lot owners; this allows for the orderly transition of authority to control the
board from the declarant to parcel owners. Determining whether a sufficient percentage
of lots have been sold to someone other than the declarant must take into account the
total number of parcels in the development, present and anticipated, including those
owned by the declarant, and therefore, where the Picacho mountain community master
plan allowed for a total of 1560 total lots, with 1493 of those lots designated for
residential purposes, and, at most, only 252 lots have been transferred, the lots sold to
date versus the total number of lots in the master plan does not require members of the
board be elected by lot owners other than the declarant because the total number of lots
sold has not reached the twenty-five percent threshold set forth in 47-16-8(E) NMSA
1978 of the HOAA. End of Exclusive Declarant Control under Home Owner Association
Act (8/17/22), Att'y Gen. Adv. Ltr. 2021-05.