Maintaining Your HOA Records

Maintaining HOA records means keeping the association’s governing documents, minutes, financial records, contracts and insurance policies organized, secure and available to the people who are entitled to see them. Start with a written records policy that says what the association keeps, for how long, where it is stored and who is responsible for it.

If you are new to your board, you have probably already met the stack of paper and the folders of files that come with the job. This article covers why the records matter, which ones to keep, how to store and dispose of them, what members are entitled to see, and how to set up a system that survives a change of board.

Why Keep HOA Records?

There are three reasons, and any one of them would be enough.

• The law requires it. Most associations are nonprofit corporations, and state corporation and community association laws generally require them to keep minutes, accounting records and a list of members. Tax rules require the association to keep the records that support its returns.
• Owners have a right to see many of them. Most states give members the right to inspect certain association records. If the board cannot find a document an owner is entitled to see, the association has a problem.
• Boards change. Volunteer directors come and go. The records are the association’s memory: why a rule was adopted, when the roofs were last replaced, what the contractor’s warranty covers, how an earlier board handled the same architectural request. Without them, each new board starts from nothing and risks treating owners inconsistently.

What Documents Should You Keep?

Because boards turn over, there is often no shared understanding of what has to be kept. One board keeps a careful minute book. The next treats minutes as something to email around and forget. Agreeing on a list is the first step.

Check your state’s law and your governing documents first. Some states list the records an association must keep and for how long, and the bylaws sometimes add their own requirements. Then ask the association’s attorney and accountant to help you set retention periods for everything else. As a starting point, most associations should be keeping the following:

• Governing documents. The recorded CC&Rs and every amendment, the articles of incorporation, the bylaws, the rules and regulations, and architectural standards. Keep superseded versions too, because you may need to know which rule was in effect on a past date. Our article on HOA governing documents explains what each one does.
• Minutes and meeting records. Minutes of board, membership and committee meetings, along with notices, agendas and written resolutions. Treat minutes as permanent records. For what belongs in them, see how board meetings break down.
• Financial records. Budgets, monthly financial statements, bank statements and reconciliations, the general ledger, invoices and receipts, assessment records for each owner, reserve studies, and audits or reviews. Our article on the parts of an HOA financial report describes the main statements.
• Tax records. Federal and state returns and the records that support them.
• Contracts. Management, landscaping, maintenance and other vendor contracts, with bids, warranties and certificates of insurance.
• Insurance records. Current and past policies, and claim files. Older liability policies can matter years later if a claim is made about something that happened while they were in force.
• Loan documents. Anything the association has signed with a lender.
• Architectural records. Owner applications, plans and the association’s written decisions. These show what was approved for each property and help the committee treat similar requests alike.
• Membership and election records. The current list of owners and their mailing addresses, and ballots and other election materials for as long as your state requires.
• Enforcement and legal files. Violation notices, hearing records, correspondence with the association’s attorney, and litigation files. Many of these are confidential and should be stored separately from records that are open to members.

How Long to Keep Them

Retention periods depend on the type of record and on your state, so this article does not give a full schedule. Two points are widely accepted. Governing documents and minutes are generally treated as permanent. For tax records, the IRS guidance on how long to keep records says to keep records that support a return for three years in most cases, for six or seven years in certain situations, and indefinitely if a return was not filed, and to keep employment tax records for at least four years. Your accountant can tell you which period applies to your association.

When in doubt, keep the record. Sooner or later someone will ask for a document, or a question will come up that only the file can answer. Storage is cheap compared with the cost of not having a contract, a policy or a set of minutes when you need it.

How Should You Store HOA Records?

Once you know what you are keeping, decide where and how.

• Paper records. Store originals somewhere dry, secure and locked, in a fire-resistant cabinet if you can. Recorded documents, signed contracts and signed minutes are the originals most worth protecting. Records should not live permanently in a director’s garage, where they tend to disappear when that person leaves the board.
• Electronic records. Scanning older files saves space and makes documents easier to find. Use an account that belongs to the association, not to an individual director, so that access can be handed over when the board changes. Back the files up in a second location, and limit who can edit or delete.
• A sensible mix. Many associations keep the current year’s working files on paper or in a shared folder for easy reference, and archive older years electronically. If the volume is large, start with the most recent years and work backward.
• Confidential material. Keep closed session minutes, attorney-client communications, personnel files, and records with owners’ bank account or Social Security numbers apart from general records, with tighter access.

If the association has a management company, the manager usually holds the working files. The records still belong to the association. Make sure the management contract says so, and says that the records will be returned in a usable form when the contract ends.

Disposing of Records

Holding on to everything forever is not practical, and a records policy should say when records may be destroyed. Follow the retention periods your attorney and accountant helped you set, and destroy records in a way that protects the personal information in them. Shred paper, and permanently delete electronic files from every device and backup. Keep a simple log of what was destroyed and when.

There is one firm exception. If the association is in a dispute, has been threatened with a lawsuit or has received a records request, do not destroy anything related to it until the association’s attorney says you may.

Member Access to Records

Owners pay for the association and are generally entitled to see how it is run. In most states, members may inspect and copy certain records, such as the governing documents, minutes of open meetings, budgets and financial statements, after making a written request. The association may usually charge the reasonable cost of copies, and it may withhold or redact confidential material such as attorney-client communications, personnel records, and other owners’ discipline or payment histories. Our article on the rights of homeowners association members covers this from the owner’s side.

Organized records make these requests easy to answer. An association that responds promptly and completely builds trust. One that stalls invites suspicion and, in some states, penalties.

California boards can use the free records request tracker to log each request and see the response deadline for every kind of record.

In California

California has detailed rules in both the Corporations Code and the Davis-Stirling Act.

• Records the association must keep. Corporations Code section 8320 requires a nonprofit mutual benefit corporation to keep adequate and correct books and records of account, minutes of the proceedings of its members, board and board committees, and a record of its members with their names, addresses and class of membership. Minutes and other records may be kept on paper or in another form that can be converted into clearly legible paper.
• What counts as an association record. Civil Code section 5200 defines the records members may inspect. The list includes the financial documents the association is required to provide to members, interim financial statements, executed contracts that are not privileged, written board approvals of vendor proposals and invoices, state and federal tax returns, reserve account balances and records of payments from reserves, agendas and minutes of member, board and committee meetings other than executive session, the membership list, check registers and the governing documents. “Enhanced association records” are the supporting documents: invoices, receipts, canceled checks, bank and credit card statements, purchase orders and reimbursement requests.
• How inspection works. Under Civil Code section 5205, the association has to make its records available for inspection and copying by a member or by a representative the member designates in writing. The association may bill the direct and actual cost of copying and mailing, if it tells the member the cost and the member agrees to pay before the copies are made. For enhanced association records, it may also bill for the time spent redacting, at no more than $10 per hour and no more than $200 per written request.
• Time periods and deadlines. Under Civil Code section 5210, association records have to be available for the current fiscal year and the two previous fiscal years, and minutes of member and board meetings have to be available permanently. Records for the current fiscal year have to be produced within 10 business days after the association receives the request, and records for the previous two fiscal years within 30 calendar days. Minutes of committees with decision-making authority have to be available within 15 calendar days after approval. Under Civil Code section 4950, minutes, draft minutes or a summary of a board meeting, other than an executive session, have to be available within 30 days of the meeting. These are the minimum periods for member access, not a full retention schedule, and other laws may require the association to keep some records longer.
• Election materials. Section 5200 also requires the association to maintain election materials, including returned ballots, signed voter envelopes, the voter list, proxies and the candidate registration list, for one year after the date of the election. Signed voter envelopes may be inspected but not copied.
• What may be withheld. Civil Code section 5215 allows the association to withhold or redact information that is reasonably likely to lead to identity theft or fraud, privileged material such as attorney-client communications, executive session minutes, personnel records other than the compensation information the section requires, another member’s disciplinary, collection or payment plan records, and interior architectural plans for individual homes. If a member asks, the association has to explain in writing the legal basis for withholding or redacting.
• Membership list opt-out. Under Civil Code section 5220, a member may opt out of having their name, property address, mailing address and email address shared through the membership list by notifying the association in writing.
• Limits on use. Under Civil Code section 5230, association records may not be sold, used for a commercial purpose, or used for any purpose not reasonably related to a member’s interests as a member.
• Penalties. Under Civil Code section 5235, a member may sue to enforce inspection rights, including in small claims court if the amount claimed is within that court’s limit. If the court finds the association unreasonably withheld access, it awards the member reasonable costs and attorney’s fees and may impose a civil penalty of up to $500 for each separate written request that was denied.
• Directors’ access. Under Corporations Code section 8334, every director has the absolute right at any reasonable time to inspect and copy all of the corporation’s books, records and documents.

Condominium associations have one more record with its own schedule. Civil Code section 5551 requires an inspection, at least once every nine years, of wood-supported balconies, decks, stairways and walkways more than six feet above the ground in buildings with three or more attached multifamily units. The written inspection reports have to be kept as association records for two inspection cycles, and section 5210 makes them open to member inspection for that period.

Creating a System for HOA Records

The best thing you can do before you open the first box is to decide how the system will work.

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1. Put someone in charge. The secretary is the usual choice, working with the manager if you have one. If the files are in poor shape, appoint two or three organized volunteers to help with the cleanup.
2. Adopt a written records policy. List the categories of records, the retention period for each, where each is stored and who may access it. Have the association’s attorney review the policy.
3. Use one filing structure. Organize paper and electronic files the same way, by category and year, with consistent file names so that anyone can find a document.
4. Build it into the routine. File minutes when they are approved, contracts when they are signed and financial reports each month. A few minutes of filing after every meeting prevents a weekend of sorting later.
5. Hand it over properly. When officers or managers change, transfer the files, passwords and account access right away, and have the new secretary confirm that the records are complete.

If your association already keeps organized records, learn the system and keep it going. If you are starting from scratch, agree on the plan first and then work through the backlog a category at a time. You will find more articles for directors in our HOA board member section.

The Law Behind This Article

Every legal point in this article comes from the official text. Each link below opens it in a new tab.

Civil Code sections: 4950 · 5200 · 5205 · 5210 · 5215 · 5220 · 5230 · 5235 · 5551

Corporations Code sections: 8320 · 8334

Other official sources: IRS guidance on how long to keep records

This article is general educational information, not legal or financial advice. Laws vary by state and your association’s governing documents control many of these questions, so check with your association’s attorney or another qualified professional about your situation.