Delaware HOA Assessment Limits

Section 1: Overview

Delaware doesn't cap what an HOA board can raise in annual assessments — at least not with a number. What the state does instead is give homeowners a veto. The governing framework is the Delaware Uniform Common Interest Ownership Act (DUCIOA), 25 Del. C. ch. 81 (§ 81-101 et seq.), with some pre-2009 condominiums still partly governed by the older Delaware Unit Property Act, 25 Del. C. ch. 22. Under DUCIOA, an executive board adopts the annual budget. That budget — including any assessment increase — takes effect automatically unless a majority of all owners votes to reject it at a ratification meeting held within a defined statutory window. If owners fail to organize that rejection in time, the new rates go into effect. Special assessments run through the same process, with a narrow exception for emergencies that requires a unanimous board vote.

That places Delaware in the middle of the national assessment-limit spectrum: not a statutory-cap state like California, where the board "may not impose a regular assessment that is more than 20 percent greater than the regular assessment for the association's preceding fiscal year or impose special assessments which in the aggregate exceed 5 percent of the budgeted gross expenses of the association for that fiscal year" without a member vote,¹ and not a CC&R-primary state where the recorded declaration serves as the principal constraint. The sections that follow detail the statutory framework, the procedures in practice, recent legislative and judicial activity, and where Delaware stands nationally.

Section 2: The assessment framework

2A. Authority to levy and allocate assessments

DUCIOA gives the unit owners' association both the obligation and the authority to fund common expenses. Section 81-302(a)(2) grants the association the power to "[m]ust adopt and may amend budgets pursuant to § 81-324 of this title and collect assessments for common expenses, including funds for the repair and replacement reserve, from unit owners."² Once the association makes its first assessment, § 81-315 requires that assessments come at least annually, based on an annually adopted budget.³ How those common expenses get divided among units follows the formula in the declaration: § 81-315(b) directs that common expenses be assessed against all units "in accordance with the allocations set forth in the declaration pursuant to § 81-207," the section that establishes common-expense-liability allocation.⁴

Whether DUCIOA governs a given community turns on when it was created. Under § 81-116, DUCIOA applies to all common interest communities created in Delaware after September 30, 2009.⁵ For communities created before that date, § 81-119 applies an enumerated list of sections to events and circumstances occurring after the effective date — and that list expressly includes the assessment, lien, and budget sections (§§ 81-315, 81-316, and 81-324) as well as the resale-certificate section (§ 81-409).⁶ The allocation formula itself remains controlled by each community's declaration.

2B. Limits on regular assessment increases

DUCIOA sets no percentage cap on regular assessment increases. The operative limit is procedural, and it lives in § 81-324(a). Within 30 days after adopting a proposed budget — applicable after the declarant-control period ends — the executive board must distribute a summary of the budget to all unit owners. That summary must include any reserves and a statement explaining the basis on which reserves are calculated and funded.⁷ At the same time, the board must set a ratification meeting to fall no less than 14 days and no more than 60 days after distributing that summary.⁷

The statute then provides that "[u]nless at that meeting a majority of all unit owners or any larger vote specified in the declaration, voting in person or by proxy, reject the budget, the budget is ratified, whether or not a quorum is present."⁷ In practical terms: any increase — however large — takes effect by default unless owners can assemble a majority to vote it down. A declaration may set a tighter standard, such as requiring a larger vote to ratify, and where it does, the stricter provision controls.⁷ If owners reject a proposed budget, the prior ratified budget stays in place until owners ratify a new one.⁷ A defective process — failing to distribute the summary or to schedule the meeting within the statutory window — also leaves the prior ratified budget in place rather than validating an unratified increase.

2C. Special assessments, emergency assessments, and the declaration

Section 81-324(b) lets the executive board propose a special assessment at any time, in addition to the regular annual budget.⁷ A special assessment takes effect only if the board follows the same ratification procedure set out in subsection (a) and owners fail to reject it. No percentage trigger applies, and no automatic owner-approval requirement kicks in — the board runs the same summary-plus-ratification-meeting process, and the special assessment is ratified unless a majority of all owners rejects it.

The exception comes in § 81-324(c): if the executive board determines by unanimous vote that a special assessment is necessary to respond to an emergency, that assessment takes effect immediately under the terms of the vote.⁷ The board must promptly notify all owners and spend the funds solely for the purpose described in the vote. Absent a genuine emergency, the board has no shortcut around ratification. The declaration's role is to supply the allocation formula and any stricter approval standard — the board cannot impose a non-emergency special assessment without running a ratification.

Section 3: Assessment limits and procedures in practice

A. Regular assessment increase procedure

The board prepares the proposed annual budget. For a condominium or cooperative, the budget must include a line item for any required repair and replacement reserve funding.⁷ Within 30 days of adopting it, the board distributes a budget summary — including reserves and the basis for calculating and funding them — to all owners, and sets a ratification meeting 14 to 60 days out. The new assessment level takes effect unless a majority of all owners votes to reject it, whether or not a quorum is present.⁷ This procedure applies to all DUCIOA communities and reaches pre-2009 communities for post-2009 budget cycles through § 81-119.⁶

B. Special assessment procedure

The board may propose a special assessment at any time. It takes effect only if the board follows the budget-ratification procedure and owners fail to reject it — except that a special assessment necessary to respond to an emergency may take effect immediately on a unanimous board vote, with prompt notice to owners.⁷ This procedure applies across DUCIOA communities and reaches pre-2009 communities for post-2009 events through § 81-119.⁶

C. Caps, ceilings, and override mechanisms

Delaware carries no statutory percentage cap on either regular or special assessments. The control mechanism is ratification: owners override an increase by mustering a majority rejection vote, and the board bypasses the ratification process only for an emergency special assessment — and only by unanimous vote.⁷ Any stricter limit — a lower percentage trigger, a higher ratification threshold, or an absolute cap — exists only if the declaration creates it. DUCIOA itself sets no numeric ceiling.⁷

D. Notice, documentation, and disclosure tied to assessments

The budget summary the board must distribute within 30 days of adoption must include reserves and explain the basis for calculating and funding them.⁷ At resale, § 81-409 requires the selling owner to furnish a certificate stating the amount of the periodic common expense assessment and any unpaid common expense or special assessment then due. For condominiums and cooperatives, the certificate must also include the current balance in the repair and replacement reserve, any approved capital expenditures, and the most recent reserve study.⁸ The association must provide that information within 10 days of an owner's request and may charge a fee not to exceed $200, with an additional charge not to exceed $50 for a paper format. A purchaser isn't liable for any unpaid assessment above the amount stated in the certificate.⁸ Section 81-409 is among the enumerated sections that reach pre-2009 communities through § 81-119.⁶

Section 4: Recent legislative and judicial activity

A. Recent bills

No enacted bill in the Delaware 152nd General Assembly (2023–2024) or 153rd General Assembly (2025–2026) amended DUCIOA's assessment, budget, reserve, or lien provisions — sections 81-315, 81-316, 81-324, or 81-409. The most recent substantive amendment is House Bill 112, enacted in the 151st General Assembly as 83 Del. Laws c. 173. It falls outside the 24-month window but remains the operative source of current statutory text.

B. Recent rulings

Delaware's Court of Chancery issued one notable ruling in this window touching common-expense allocation in a condominium community. The case didn't address assessment ratification or budget procedures directly — but it shows how Delaware courts resolve maintenance-responsibility disputes in older communities governed by the Unit Property Act rather than DUCIOA.

C. Active legislative debates

No active state-level proposal in the 153rd General Assembly specifically targets DUCIOA's budget process, special assessments, or reserves. The more active front is at the county level in New Castle County, where the legislature adopted a façade-inspection ordinance in 2023 and a task force put forward a statewide reserve-funding proposal that has yet to reach the General Assembly as law.

Section 5: National positioning and related coverage

Delaware sits squarely in the middle of the national assessment-limit spectrum. At one end stand the statutory-cap states, led by California, where Cal. Civ. Code § 5605 caps regular increases at 20 percent over the prior fiscal year and special assessments at 5 percent of budgeted gross expenses without member approval.¹ In the middle sit the ratification-mechanism UCIOA states — Delaware, Alaska, Colorado, Connecticut, Vermont, and Washington — where the board adopts a budget that takes effect unless owners reject it. At the other end are the CC&R-primary states such as Alabama, Arkansas, and Mississippi, where the recorded declaration is the principal constraint. Delaware runs on the modern UCIOA text reflecting the 2008 amendments.¹³

For multi-state operators moving from a percentage-cap state into Delaware, the practical shift moves from a numeric ceiling — is the increase under 20 percent? — to a procedural one: did the board meet the 30-day summary and 14-to-60-day meeting deadlines, and did owners fail to reject? Federal frameworks — including the Fair Debt Collection Practices Act, the Servicemembers Civil Relief Act, and the bankruptcy treatment of assessments — also bear on Delaware assessment practice and will receive separate coverage as that section develops.

Recommendations

• Immediate (boards and managers): Treat the § 81-324 calendar as the binding compliance task. After adopting the budget, circulate the budget summary — with reserves and the reserve-funding basis — within 30 days, and schedule the ratification meeting in the 14-to-60-day window. A missed deadline doesn't validate an increase; it freezes the community on the last ratified budget. Build proxy solicitation into this timeline, since HB 112 confirmed proxy voting at ratification meetings.
• Before levying a special assessment: Default to running a full ratification unless the board can document, by unanimous vote, that the assessment responds to a genuine emergency under § 81-324(c). Reserve the emergency path for true emergencies. A unanimous vote and contemporaneous documentation of the emergency purpose are the operative thresholds, and emergency funds must go only toward the stated purpose.
• For multi-state operators: Retrain staff arriving from percentage-cap states — California in particular. In Delaware, the question is not whether an increase exceeds a numeric threshold but whether the procedure was followed and whether owners failed to reject. Map each community's declaration for any stricter ratification threshold, which controls over the statutory default.
• For pre-2009 condominiums: Confirm whether the community operates under the Unit Property Act or DUCIOA, because Smernoff shows the choice of statute drives whether a repair cost is a shared common expense. Note that §§ 81-315, 81-316, 81-324, and 81-409 reach pre-2009 communities for post-2009 events through § 81-119.
• Benchmarks that would change this guidance: Watch the 153rd General Assembly for any bill amending §§ 81-315, 81-316, 81-324, or 81-409 — a new "84 Del. Laws" citation in the code history would signal an enacted change. Also watch whether the New Castle County reserve-and-inspection recommendations get introduced as statewide DUCIOA amendments. Either development would warrant revising the reserve-funding and disclosure sections above.

Caveats

• No DUCIOA assessment, budget, reserve, or lien amendment was enacted in the 152nd or 153rd General Assembly through the date of this page; HB 112 (83 Del. Laws c. 173) remains the most recent amendment to the relevant sections. This is a verified negative finding based on statutory-history citations terminating at 83 Del. Laws c. 173, not an exhaustive full-text search of every introduced bill.
• The exact day of HB 112's enactment is reported by an industry source (CAI) as a September 2021 signature with an October 2021 effective date; the bill's official Delaware General Assembly page is the controlling record for status and dates.
• Smernoff v. King's Grant was decided under the Unit Property Act, not DUCIOA, and addressed maintenance responsibility and common-expense allocation rather than assessment validity or ratification. It appears here because it is the most recent Delaware decision in the window touching common-expense allocation; readers should not read it as interpreting § 81-324.
• The New Castle County ordinance and the task force's 30-year-cash-flow reserve recommendation are county-level and proposal-stage developments, respectively. The reserve recommendation has not been enacted as a statewide DUCIOA amendment, and references to statewide expansion in industry commentary are forward-looking rather than law.
• Reserve-funding minimums tied to budget percentages and the "fully funded" definition apply specifically to condominiums and cooperatives; planned communities that are not condominiums or cooperatives may fall outside those exact rules and should confirm application with counsel. These reserve mechanics sit alongside, but are distinct from, the assessment-limit (ratification) framework that is the subject of this page.

1. Cal. Civ. Code § 5605, California Legislative Information ↩
2. 25 Del. C. § 81-302 (Powers of unit owners' association), Delaware Code Online ↩
3. 25 Del. C. § 81-315 (Assessments for common expenses), Delaware Code Online ↩
4. 25 Del. C. § 81-207 (Allocation of common element interests, votes, and common expense liabilities), Delaware Code Online ↩
5. 25 Del. C. § 81-116 (Applicability to new common interest communities; effective date), Delaware Code Online ↩
6. 25 Del. C. § 81-119 (Applicability to preexisting common interest communities), Delaware Code Online ↩
7. 25 Del. C. § 81-324 (Adoption of budget), Delaware Code Online ↩
8. 25 Del. C. § 81-409 (Resales of units), Delaware Code Online ↩
9. House Bill 112, 151st General Assembly (83 Del. Laws c. 173), Delaware General Assembly ↩
10. Smernoff v. The King's Grant Condominium Association, Inc., C.A. No. 2020-0798-BWD (Del. Ch. July 12, 2024) ↩
11. New Castle County Ordinance No. 23-094 (façade and primary load-bearing-system inspections), New Castle County, Delaware ↩
12. Delaware General Assembly, House Bill 112 record and DUCIOA legislative history (context for proposed reserve-standard amendments) ↩
13. 25 Del. C. § 81-101 et seq. (Delaware Uniform Common Interest Ownership Act), Delaware Code Online ↩