HBA-PDH H.B. 901 76(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 901 By: Dutton Business & Industry 2/23/1999 Introduced BACKGROUND AND PURPOSE Currently, a property owners' association may file a lien against real property for the failure to pay certain fees or assessments. H.B. 901 prohibits a property owners' association from filing a lien on real property for an assessment levied by the association against real property unless the association submits to binding arbitration to establish the existence and amount of any debt owed. The bill provides notice requirements and establishes guidelines for the appointment of an arbitrator. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. SECTION BY SECTION ANALYSIS SECTION 1. Amends Chapter 202, Property Code, by adding Section 202.006, as follows: Sec. 202.006. ARBITRATION REQUIRED TO ESTABLISH LIEN FOR ASSESSMENTS. (a) Prohibits a property owners' association (association) from filing a lien on real property for an assessment levied by the association against the real property unless the association submits to binding arbitration to establish the existence and amount of the debt owed. Provides an exception. (b) Provides that an association must provide written notice by certified mail, return receipt requested, to the property owner's last known mailing address, as reflected in the ownership records maintained by the association, of the association's intention to initiate arbitration proceedings. Requires the property owner, within 10 days of receiving notice, to notify the association as to whether the property owner intends to or refuses to participate in the arbitration proceedings. Provides that the association is not required to comply with this section if the property owner refuses to participate in the arbitration proceedings or fails to provide timely notice to the association. (c) Authorizes the association and the property owner to agree on the appointment of an arbitrator. Authorizes the association or the property owner to file a petition in a district court in the county in which all or part of the property is located requesting the court to appoint an arbitrator if the parties fail to reach an agreement within 29 days after the association notifies the property owner of the association's intention to initiate arbitration proceedings. Requires the court to appoint an arbitrator within 30 days after the petition is filed. (d) Requires the cost of arbitration to be paid as provided by the arbitrator. SECTION 2.Effective date: September 1, 1999. SECTION 3.Emergency clause.