85R11844 AJA-D
	By: Vo	H.B. No. 3528

	A BILL TO BE ENTITLED
	AN ACT
	relating to the collection of past due assessments and certain
	other charges by a property owners' association.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Chapter 209, Property Code, is amended by adding
	Sections 209.0061, 209.00611, and 209.00612 to read as follows:
	Sec. 209.0061.  COLLECTION OF PAST DUE ASSESSMENTS: FEES AND
	COLLECTION COSTS. (a) If a property owners' association's
	dedicatory instruments authorize the association to impose late
	fees on, or recover costs associated with the collection of, past
	due regular or special assessments, the association may collect
	only the following fees and costs:
	(1)  a single late fee for each past due assessment that
	does not exceed 10 percent of the past due assessment;
	(2)  if any interest or administrative costs are
	authorized by the dedicatory instruments, a monthly charge that:
	(A)  does not exceed one-half of one percent of
	all unpaid past due assessments; and
	(B)  is payable directly to the association,
	regardless of whether the amount is ultimately used to pay the
	association's property manager;
	(3)  if the association sends a follow-up letter
	authorized by Section 209.00611(b), a charge for attorney's fees
	that does not exceed 25 percent of the past due assessments; and
	(4)  for a payment plan, regardless of whether the
	association is required to offer the plan under Section 209.0062, a
	monthly charge that does not exceed three percent of the sum of:
	(A)  the past due assessments; and
	(B)  any charges authorized by Subdivision (1),
	(2), or (3) incurred as of the date the payment plan is accepted.
	(b)  A property owners' association may not impose a charge
	other than the charge authorized by Subsection (a)(1) before the
	31st day after the date the association sends the property owner a
	letter that complies with Section 209.00611(a).
	(c)  A property owners' association may not impose attorney's
	fees or any other charges on a property owner for:
	(1)  documentation or other information requested by
	the owner in order to:
	(A)  confirm the amount of assessments due; or
	(B)  understand:
	(i)  an assessment or a related charge; or
	(ii)  a payment plan being offered to the
	owner; or
	(2)  the negotiation of the terms of a payment plan.
	(d)  Subsection (c)(2) does not require a property owners'
	association to offer a payment plan other than as required by
	Section 209.0062.
	Sec. 209.00611.  COLLECTION OF PAST DUE ASSESSMENTS:
	COLLECTION LETTERS. (a) A letter sent to a property owner by or on
	behalf of a property owners' association seeking to collect a past
	due regular or special assessment must:
	(1)  be sent to the owner by certified mail to the
	address to which the association usually sends invoices or other
	official communications and, if the association uses e-mail to
	communicate with property owners, to each e-mail address provided
	by the owner for that purpose;
	(2)  itemize each charge the association seeks to
	collect and reference to each provision in the dedicatory
	instruments on which the charge is based;
	(3)  state:
	(A)  a total amount certain that the association
	claims is due;
	(B)  the date on which that amount was determined;
	and
	(C)  that payments made after that date will be
	credited as provided by law;
	(4)  if Section 209.0062 applies to the association or
	the association's dedicatory instruments require a payment plan to
	be offered, include the terms of an available payment plan that
	complies with that section;
	(5)  state that the owner must pay the total amount
	claimed or, if applicable, accept and deliver the first amount due
	under the payment plan on or before the 30th day after the date the
	letter was sent to avoid additional charges related to collection
	of the assessments;
	(6)  provide the owner with a phone number the owner may
	use at no cost to ask questions about the charges or the payment
	plan terms;
	(7)  provide an address to which the owner may send a
	check or money order as payment and notify the owner of any
	available online payment portal; and
	(8)  notify the owner that attorney's fees and other
	charges may be imposed and that a lawsuit may be filed to collect
	the unpaid amount if:
	(A)  the owner does not pay the total amount
	claimed or, if applicable, accept and deliver the first payment
	under the payment plan in the time provided by Subdivision (5); or
	(B)  the owner accepts a payment plan and does not
	comply with the plan.
	(b)  Not earlier than the 31st day after the date a letter
	described by Subsection (a) is sent to a property owner, the
	property owners' association may send a follow-up letter that
	includes a charge for attorney's fees authorized by Section
	209.0061(a)(3).
	Sec. 209.00612.  COLLECTION OF PAST DUE ASSESSMENTS:
	LAWSUITS. (a) In a lawsuit filed by a property owners' association
	to collect past due assessments, the original petition:
	(1)  must prominently state that:
	(A)  the property owner may resolve the entire
	claim by paying, on or before the 60th day after the date the owner
	is served with the petition, an amount certain stated in the
	petition that the association claims is due:
	(i)  determined as of a date stated in the
	petition; and
	(ii)  that includes only the itemized
	amounts described by Subdivision (2); and
	(B)  any payment received after the stated date on
	which the amount certain was determined will be credited towards
	the amount claimed in the petition; and
	(2)  may include a claim only for the following
	itemized amounts:
	(A)  past due regular and special assessments;
	(B)  costs or fees the association may collect
	under Section 209.0061;
	(C)  filing fees, fees for service of process,
	certified mail charges incurred in connection with the suit, and
	any other charges paid by the association in connection with the
	suit that the association is authorized to collect under the
	dedicatory instruments; and
	(D)  additional attorney's fees in an amount that
	does not exceed $500.
	(b)  A payment received from a property owner after the
	stated date on which the amount certain claimed in the petition was
	determined must be credited towards the claimed amount.
	(c)  A property owners' association may not impose any
	additional collection-related charges in connection with the past
	due assessments being claimed before the 61st day after the date the
	association's petition is served on the property owner.
	(d)  A property owner must be allowed to make a payment in
	satisfaction of the claim by check or money order to the attorney or
	law firm representing the association.
	(e)  In a lawsuit described by Subsection (a), the court may
	award reasonable and necessary attorney's fees as are equitable and
	just.
	SECTION 2.  Section 209.0062, Property Code, is amended by
	amending Subsection (a) and adding Subsection (a-1) to read as
	follows:
	(a)  A property owners' association composed of more than 14
	lots shall adopt reasonable guidelines to establish an alternative
	payment schedule by which an owner may make partial payments to the
	property owners' association for delinquent regular or special
	assessments or any other amount owed to the association without
	accruing additional monetary penalties other than amounts
	authorized by Section 209.0061.
	(a-1)  A payment plan offered by a property owners'
	association for payment of past due assessments, regardless of
	whether the association is subject to Subsection (a):
	(1)  may not be conditioned on payment of any amount not
	authorized by Section 209.0061; and
	(2)  must allow the owner to pay off at any time without
	additional penalty or requirement for further payments under the
	plan the outstanding balance of the past due assessments and any
	charges authorized by Section 209.0061(a)(1), (2), or (3) that were
	incurred as of the date the payment plan was entered into [For
	purposes of this section, monetary penalties do not include
	reasonable costs associated with administering the payment plan or
	interest].
	SECTION 3.  The heading to Section 209.0063, Property Code,
	is amended to read as follows:
	Sec. 209.0063.  PRIORITY OF PAYMENTS; LATE OR PARTIAL
	PAYMENTS.
	SECTION 4.  Section 209.0063, Property Code, is amended by
	adding Subsection (c) to read as follows:
	(c)  A property owners' association must accept a partial
	payment on any amount due to the association, regardless of whether
	the owner is subject to a payment plan, to be applied in accordance
	with this section. If the association uses an online payment
	portal, the association may not block an owner's ability to make a
	late or partial payment through the portal.
	SECTION 5.  Section 209.009, Property Code, is amended to
	read as follows:
	Sec. 209.009.  FORECLOSURE SALE PROHIBITED IN CERTAIN
	CIRCUMSTANCES. A property owners' association may not foreclose a
	property owners' association's assessment lien unless the debt
	secured by the lien includes more than $5,000 of debt described by
	Section 209.0063(a)(1), (2), or (3) [if the debt securing the lien
	consists solely of:
	[(1)  fines assessed by the association;
	[(2)     attorney's fees incurred by the association
	solely associated with fines assessed by the association; or
	[(3)     amounts added to the owner's account as an
	assessment under Section 209.005(i) or 209.0057(b-4)].
	SECTION 6.  (a) Except as provided by Subsection (b) of this
	section, the changes in law made by this Act apply only to
	collection of regular and special assessments that become due on or
	after the effective date of this Act. Collection of assessments
	that became due before the effective date of this Act is governed by
	the law as it existed immediately before the effective date of this
	Act, and that law is continued in effect for that purpose.
	(b)  Section 209.0063(c), Property Code, as added by this
	Act, applies to a payment made by a property owner on or after the
	effective date of this Act.
	SECTION 7.  This Act takes effect September 1, 2017.