Montana bill requiring HOA budgets and capping dues rises died at the deadline
Montana bill requiring HOA budgets and capping dues rises died at the deadline
2026-09-15 · Montana · Legislation · Did not pass
What happened. The one 2025 bill that would have given Montana owners a statutory right to see their association's money died — after clearing second reading on the House floor.
The bill and its fate
House Bill 232, sponsored by Rep. Terry Falk (R), would have amended §§ 35-2-114 and 35-2-525, MCA — the Montana Nonprofit Corporation Act provisions most associations are organised under. Its official status history is short and final:1
- (H) 2nd Reading — February 4, 2025
- (H) Missed Deadline for General Bill Transmittal — March 12, 2025
- (H) Died in Process — May 20, 2025
The March 12 deadline is Montana's hard mid-session wall; 336 bills died against it in 2025.
What it would have required
As amended, HB 232 would have imposed two reporting duties and one fee constraint:2
- An annual budget report by fiscal year end, itemising estimated revenue and expenses for the next year.
- An annual financial report no later than 30 days after fiscal year end, itemising each revenue and expenditure category totalling at least $50 annually, plus each fund's ending balance and any unreserved balance.
- Both sent by mail and by email to every member, postmarked within 15 days of the due date (amended down from 30).
On money: increases once annually only, and not to exceed 15 percent or $100, whichever is greater. An increase up to 15 percent would have needed a majority of assessed owners in writing; anything more than once a year, or above 15 percent, would have needed three-fifths (amended down from two-thirds). Associations of 10 or fewer parcels were exempt.
What stayed the same, which is the actual news
Because HB 232 failed, Montana law today imposes on an association:
- No duty to produce a budget.
- No duty to produce a financial report.
- No duty to distribute either one to members.
- No cap on assessment increases.
- No owner-vote requirement before raising assessments.
All of it remains whatever the declaration and bylaws say. Where the documents are silent, the board's discretion is the rule. Montana has no HOA ombudsman, no registry, and no agency with jurisdiction over any of this — disputes are contractual and go to district court.
The nearest thing to a statutory floor is Title 35, chapter 2 nonprofit corporation law, which was not amended in 2025 in any respect reaching associations. Section 35-2-906 on corporate records has a history note ending in 1993.
Why the dead text still matters to boards
Two reasons, and neither is sentimental.
First, it is the template. Nothing about HB 232's substance was rejected on the merits — it never got a floor vote, it ran out of calendar. Bills that die that way in Montana come back. The specific numbers in it — a 30-day financial report, a $50 itemisation threshold, a 15 percent increase cap, a three-fifths supermajority, a 10-parcel exemption — are the numbers a 2027 version would start from.
Second, the same subject is live in the interim. The committee draft of a Uniform Common Interest Ownership Act now in front of the Local Government Interim Committee would establish, in its own title clause, “FINANCIAL AND OTHER ASSOCIATION RECORD CREATION AND RETENTION RULES.” An association that would have had to comply with HB 232 would have to comply with something similar under that act. The committee takes executive action on the draft on September 17, 2026.
The practical question a board can answer now
Whether or not a statute ever arrives, the gap HB 232 aimed at is real and it is where owner conflict comes from. An association with no budget circulated and no financial summary distributed is an association whose next assessment increase will be read as arbitrary, because members have no basis on which to read it any other way.
Three things boards can do without waiting for the Legislature, and which a 2027 bill would make mandatory anyway:
- Circulate the operating budget before the year it covers. HB 232's deadline — fiscal year end — is a reasonable default.
- Circulate a year-end summary of revenue and expenditure by category, with fund balances. The $50 itemisation threshold in the dead bill is finer than most associations need; category-level totals plus reserves is the substance.
- Document the basis of any increase at the time it is adopted, in the minutes. Montana requires no vote; it also does not stop a board from explaining itself.
None of that is legal advice about any particular association's documents, and none of it is required. It is what the failed bill was reaching for, available without it.
One correction worth making
A claim circulates that a 2025 Montana bill amended the Unit Ownership Act's definition of “common expenses” to include allocations to reserves. It did not. No 2025 law amended Title 70, chapter 23 at all — the Unit Ownership Act was not touched in the 2025 session, and the reserve-funding vehicle, House Bill 619, died in committee.3
Related Montana HOA Topics
- Montana Legislature Bill Explorer API — HB 232 (2025) status history: 2nd Reading Feb. 4, 2025; Missed Deadline for General Bill Transmittal Mar. 12, 2025; Died in Process May 20, 2025 ↩
- House Bill 232 (2025), introduced text — annual budget and financial report requirements and fee-increase limits (Montana Legislature document store) ↩
- Local Government Interim Committee — HJ 50 study materials, including the UCIOA committee draft and its record-creation and retention provisions ↩
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