Arizona HOA Assessment Limits

Key Findings

• Two separate statutes govern community-association assessments in Arizona: the Condominium Act under Title 33, Chapter 9, and the Planned Communities Act under Title 33, Chapter 16. The two do not overlap — the planned-community cap does not reach condominiums.¹
• The planned-community cap is precise: 20 percent above the prior fiscal year's regular assessment, regular assessments only, a majority of all members required to override it — and if the community documents set a tighter limit, that lower number wins.²
• Special assessments fall outside the 20 percent cap entirely — what governs them is the declaration and bylaws.³
• The most recent legislation moved in a different direction — targeting collections, not increase caps. SB1494 (2025) raised the foreclosure threshold for planned communities. A 2026 proposal, SB1500, would pull the regular-increase trigger down to 3 percent, but it has not become law.⁴
• No published Arizona appellate opinion in the past 36 months has turned on the § 33-1803 cap or the validity of an assessment increase.

Details

Section 1: Overview

Arizona draws a hard line through statute. Under the Planned Communities Act, a planned-community association "shall not impose a regular assessment that is more than twenty percent greater than the immediately preceding fiscal year's assessment without the approval of the majority of the members of the association."⁵ Two separate statutes govern community-association assessments in Arizona: the Condominium Act, A.R.S. § 33-1201 et seq. (Title 33, Chapter 9), and the Planned Communities Act, A.R.S. § 33-1801 et seq. (Title 33, Chapter 16).¹ A.R.S. § 33-1803(A) holds planned-community regular increases to 20 percent above the immediately preceding fiscal year's regular assessment — unless a majority of all members approve a larger figure, and always subject to any tighter limit in the community documents.² The Condominium Act carries no comparable statutory cap; condominium boards answer only to their declaration and bylaws.⁶ Neither Act caps special assessments or imposes a general member-approval requirement on them. Nationally, Arizona aligns with California among statutory-cap states, a different model than the owner-ratification states under the Uniform Common Interest Ownership Act or the recorded-declaration states that leave assessment limits entirely to CC&Rs.

Section 2: The assessment framework

2A. Authority to levy and allocate assessments

In a planned community, the power to assess flows from the recorded declaration. The Planned Communities Act assumes mandatory membership and requires owners to pay assessments — but A.R.S. § 33-1803 regulates the regular assessment without itself creating that power; the community documents do that.⁷ The declaration, not the statute, sets the formula for dividing the total budget among lots.

Condominiums work under more explicit statutory authority. A.R.S. § 33-1242(A)(2) directly authorizes the association to adopt and amend budgets — for revenues, expenditures, and reserves — and to collect assessments for common expenses from unit owners.⁸ Allocation falls to A.R.S. § 33-1255: all common expenses assess against all units according to the declaration's formula, and assessments must be made at least annually based on a budget the association adopts at least annually.⁹

In both forms, the board sets the assessment through the budget — and neither Act requires a member vote to adopt that budget. That is what separates Arizona from owner-ratification states. The board adopts the budget; the declaration's allocation formula produces the per-lot or per-unit figure. For condominiums, A.R.S. § 33-1255 fills the gap when the declaration is silent or ambiguous on allocation. Planned communities have no comparable statutory default and depend entirely on their declaration.

2B. Limits on regular assessment increases

For planned communities, A.R.S. § 33-1803(A) sets the line: the association "shall not impose a regular assessment that is more than twenty percent greater than the immediately preceding fiscal year's assessment without the approval of the majority of the members of the association."¹⁰ Three things about that limit are worth knowing. The cap reaches regular assessments only — not special assessments. The override standard is a majority of all members, not a majority of a quorum. And the statute functions as a floor for member protection: if the declaration sets a tighter limit, that tighter limit governs.

Condominium boards operate under no comparable statutory cap. A.R.S. § 33-1242 and § 33-1255 authorize the board to adopt budgets and levy assessments but say nothing about how much those assessments can grow year over year.¹¹ Whatever limits apply come from the declaration and bylaws. A 2024 bill — HB2083 — would have added a 20 percent condominium cap, but it did not pass. Reports of a statutory condominium cap are wrong.

Arizona's structure diverges from California's in important ways. California Civil Code § 5605(b) bars the board from imposing a regular assessment more than 20 percent above the prior year's figure, or special assessments exceeding 5 percent of budgeted gross expenses, without a majority of a quorum of members — and § 5605(c)(3) defines that quorum as more than 50 percent of the membership.¹² Arizona carries no special-assessment cap, applies its 20 percent rule to planned communities only, and demands a majority of all members rather than a majority of a quorum.

2C. Special assessments, member approval, and collection charges

Neither the Condominium Act nor the Planned Communities Act defines or caps special assessments, and neither requires a member vote to approve one. A.R.S. § 33-1803(A)'s 20 percent cap says "regular assessment" — and that's exactly what it means. A special assessment levied for a project, a shortfall, or an emergency falls outside the cap.³ Member-vote requirements and any dollar ceiling come from the declaration and bylaws.

Late charges are statutory. A.R.S. § 33-1803(A) caps planned-community late charges at the greater of fifteen dollars or ten percent of the unpaid amount — and the association must give notice before it can impose any charge. A payment is late at 15 days past its due date unless the governing documents allow a longer grace period.¹³ For condominiums, A.R.S. § 33-1242 authorizes late charges and monetary penalties, again after notice. An association's lien for unpaid assessments arises under A.R.S. § 33-1807 for planned communities and A.R.S. § 33-1256 for condominiums; foreclosure thresholds differ between the two.¹⁴

Section 3: Assessment limits and procedures in practice

A. Regular assessment increase procedure

For both association types, the board adopts the annual budget and calculates the assessment using the declaration's allocation formula. A.R.S. § 33-1255 requires condominium assessments to be made at least annually, tied to a budget adopted at least annually.¹⁵ For planned communities, if the proposed regular assessment exceeds 120 percent of the prior year's figure — or crosses any lower community-document limit — the board must secure approval from a majority of all members before imposing it under A.R.S. § 33-1803(A).¹⁶ Proceed without that vote, and the increase falls outside the board's authority. Condominium boards face no statutory percentage trigger; the declaration and bylaws set the effective date and any approval requirement.

B. Special assessment procedure

For both association types, special assessments answer to the community documents — not to any Arizona statute. No statute sets a percentage ceiling or requires member approval. Board authority, voting requirements, and notice all run from the declaration and bylaws. Because A.R.S. § 33-1803(A) limits its reach to regular assessments, no board can use that provision to authorize or constrain a special assessment.¹⁷

C. Caps, ceilings, and override mechanisms

For planned communities, the statutory ceiling stands at 20 percent above the prior fiscal year's regular assessment. A.R.S. § 33-1803(A) allows only one way past it — a majority of all members — and the lower of that statutory figure or any community-document limit always controls.¹⁸ Condominiums have no statutory ceiling at all; the cap and any override come entirely from the declaration and bylaws.¹⁹

D. Notice, documentation, and disclosure tied to assessments

Both association types must give notice before imposing a late-payment charge — that requirement flows from A.R.S. § 33-1803(A) for planned communities and A.R.S. § 33-1242 for condominiums.²⁰ On resale, A.R.S. § 33-1806 requires planned communities to disclose the regular assessment and any unpaid assessment, special assessment, or other charge currently due.²¹ Condominiums must satisfy comparable requirements under A.R.S. § 33-1260, which also calls for disclosure of reserve information.²² Both types of associations can have assessment disputes — and disputes over governing documents — heard administratively by the Arizona Department of Real Estate through the Office of Administrative Hearings under A.R.S. § 32-2199 et seq.²³

Section 4: Recent legislative and judicial activity

A. Recent bills

B. Recent appellate rulings

No published Arizona appellate opinion from the past 36 months turns on the A.R.S. § 33-1803 cap, the validity of a regular-assessment increase, or a special assessment. The closest relevant decision addressed a different question entirely.

C. Active legislative debates

The current debate centers on SB1500 (2026), which would pull the regular-increase trigger to 3 percent for both planned communities and condominiums and layer in new budget-disclosure mandates. Earlier sessions produced similar proposals — HB2083 (2024) among them — that failed to advance.

Recommendations

• For planned communities, the 20 percent figure is a hard line — not a guideline. Before adopting any budget, stack the proposed regular assessment against 120 percent of the prior fiscal year's figure and any stricter declaration limit. Apply whichever is lower. If the proposed increase crosses that threshold, schedule a vote and secure approval from a majority of all members — not merely a majority of those who show up to vote — before imposing it.¹⁶
• For condominiums, assume no statutory ceiling exists — because none does. Pull the increase limits and any approval mechanism from the declaration and bylaws, and document that analysis, because the Condominium Act supplies no percentage cap.¹¹
• Do not apply the regular-increase cap to special assessments. Draw authority, voting requirements, and notice from the governing documents, and have counsel verify that the charge is genuinely "special" — not a regular assessment dressed differently.¹⁷
• Update collection and foreclosure procedures for planned communities to the 18-month or $10,000 threshold under amended A.R.S. § 33-1807. Condominium procedures under § 33-1256 remain unchanged — leave them as they are.⁴
• Track SB1500 through the 2026 session. The number that changes everything is a signature: if the governor signs the bill, a 3 percent trigger would force a complete redesign of budgeting and member-vote workflows for both planned communities and condominiums. Until that signature lands, the operative rule is the 20 percent planned-community cap — and no condominium cap.²⁵

Caveats

• Arizona's online statutes reflect the version that took effect January 1 following the most recent session; the official version comes from Thomson Reuters. Statutory text was verified against azleg.gov as of June 8, 2026, but an active session can change those figures — newly signed 2026 legislation should be rechecked.
• Bill statuses — SB1500 pending, HB2083 failed, SB1494 signed — are time-sensitive and were verified as of June 8, 2026. Tracking dates rely on azleg.gov bill pages and official chapter laws.
• The conclusion that no published Arizona appellate decision in the past 36 months addresses the § 33-1803 cap reflects a search of azcourts.gov, Justia, and practitioner case-law updates. Unpublished memorandum decisions are not comprehensively indexed and carry no precedential value — run a paid citator check before relying on that absence in litigation.
• This page describes statutory frameworks. It is not legal advice. Allocation rules, special-assessment authority, and increase limits frequently turn on the specific declaration and bylaws of each community.

Footnotes

1. Ariz. Rev. Stat. tit. 33, chs. 9, 16 (Condominiums and Planned Communities) ↩
2. Ariz. Rev. Stat. § 33-1803(A) ↩
3. Ariz. Rev. Stat. § 33-1803(A) (limiting cap to regular assessments) ↩
4. 2025 Ariz. Sess. Laws ch. 71 (amending Ariz. Rev. Stat. § 33-1807) ↩
5. Ariz. Rev. Stat. § 33-1803 ↩
6. Ariz. Rev. Stat. § 33-1255, Assessments for common expenses ↩
7. Ariz. Rev. Stat. § 33-1803 (assessment authority derived from community documents) ↩
8. Ariz. Rev. Stat. § 33-1242(A)(2), Powers of unit owners' association ↩
9. Ariz. Rev. Stat. § 33-1255 ↩
10. Ariz. Rev. Stat. § 33-1803(A) ↩
11. Ariz. Rev. Stat. § 33-1242 ↩
12. Cal. Civ. Code § 5605 ↩
13. Ariz. Rev. Stat. § 33-1803(A) (late-payment charges) ↩
14. Ariz. Rev. Stat. § 33-1807, Common expense liens (planned communities) ↩
15. Ariz. Rev. Stat. § 33-1255(A) ↩
16. Ariz. Rev. Stat. § 33-1803(A) (member-approval requirement for increases above cap) ↩
17. Ariz. Rev. Stat. § 33-1803(A) (cap limited to regular assessments) ↩
18. Ariz. Rev. Stat. § 33-1803(A) (statutory ceiling and override mechanism) ↩
19. Ariz. Rev. Stat. § 33-1242 (no statutory ceiling for condominiums) ↩
20. Ariz. Rev. Stat. §§ 33-1803(A), 33-1242 (notice before late charges) ↩
21. Ariz. Rev. Stat. § 33-1806, Resale of units (planned communities) ↩
22. Ariz. Rev. Stat. § 33-1260, Resale of units (condominiums) ↩
23. Ariz. Rev. Stat. § 32-2199.01, Hearing; rights and procedures ↩
24. H.B. 2083, 56th Leg., 2d Reg. Sess. (Ariz. 2024) ↩
25. S.B. 1500, 57th Leg., 2d Reg. Sess. (Ariz. 2026) ↩
26. Cao v. PFP Dorsey Invs., LLC, 257 Ariz. 82, 545 P.3d 459 (Ariz. 2024) ↩