Does Ohio Law Permit Compensation of any Type for HOA Directors?
The Act is silent as to compensation of board-members and officers. However, among the permitted “powers of owner’s association” that an HOA may exercise “through its board of directors” are “powers…conferred by the declaration or bylaws…permitted to be exercised in [Ohio] by a nonprofit corporation…[or] necessary and proper for the government and operation of the owners association.” O.R.C. §5312.06. Ohio’s Nonprofit Corporation Law permits a nonprofit corporation to adopt regulations for the governance of the organization either within 90 days of the date of incorporation or, if later, by majority vote of the voting members.
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Does Ohio Law Require an HOA Board to Appoint Officers from the Elected Members of the Board?
The Act states that an HOA’s “declaration and bylaws shall provide for the following…The election of the board of directors…[and] The powers and duties of the board.” O.R.C. §5312.02(B). The Act then provides that the “board of directors…shall elect officers from the members of the board, to include a president, secretary, treasurer, and other officers as the board designates.” O.R.C. §5312.04(A) (emphasis added). Thus, to comply with the Act, an HOA must elect board-members in a manner established in its declaration and bylaws, and the board must then elect officers from among the elected board-members.
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What Does an HOA Do?
A homeowners association’s primary functions are to maintain common areas within the community and enforce restrictions and covenants. Common areas (or “common elements” in the statute) are the property within a development that is collectively owned by all homeowners through the association. Common elements might include private roads, a community pool, playground, or other recreational facilities, or - in the case of a condo association - the portions of the building that are not part of any particular owner’s unit, like the roof, elevator, or lobby.
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Where do HOAs Get their Authority?
A homeowners’ association or condominium association derives its power from its governing documents, including a declaration and bylaws recorded in the county land records, and from state statutes authorizing community associations. In Ohio, homeowners and condominium associations are authorized by the Ohio Planned Community Law and Condominium Law, enacted as Chapters 5310 and 5311 of the Ohio Code, respectively.
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