North Dakota HOA Assessment Limits

Key Findings

North Dakota has no statutory cap on HOA or condominium assessment increases and no mechanism for owners to ratify or reject a board-adopted budget. The limit on what a board can charge — and by how much it can increase — lives in the recorded declaration or covenants, not in any state statute.

For condominiums, the governing statute is N.D. Cent. Code Ch. 47-04.1 — an older, horizontal-property-style chapter that predates the Uniform Condominium Act and the UCIOA.¹ The chapter governs how a condominium project forms, how expenses are allocated by the recorded fractional or percentage interests, and how an unpaid assessment becomes a lien. It says nothing about percentage caps or budget ratification.

HOAs operate under no dedicated North Dakota statute. An HOA runs on its recorded covenants and, if incorporated, the Nonprofit Corporations Act, N.D. Cent. Code Ch. 10-33.² The Act provides corporate governance mechanics but no assessment cap and no lien right.

The most consequential development in recent years for assessment-lien practice is Industrial Commission of North Dakota v. Gould, 2024 ND 32, where the Supreme Court rejected an HOA declaration's "super lien" claim and held that lien priority turns on the date of perfection.³

Details

Overview: how assessment authority and limits work in North Dakota

In North Dakota, assessment authority traces to one place: the recorded document. The state imposes no statutory percentage cap on assessment increases and provides no budget-ratification or owner-veto mechanism. Condominium communities organize under the Condominium Ownership of Real Property chapter, N.D. Cent. Code Ch. 47-04.1 (§§ 47-04.1-01 et seq.) — an older horizontal-property-style statute rather than a Uniform Condominium Act or UCIOA enactment.¹ Under that framework, the board sets assessments through the budget, guided by the declaration and bylaws, and no statute caps the increase or requires owners to ratify it.⁴ Special assessments draw their authority and their limits from those same recorded instruments, not from any statutory ceiling. On the national spectrum, North Dakota stands apart from statutory-cap states such as California, where Cal. Civ. Code § 5605 limits regular and special assessment increases, and from UCIOA-family states that control increases through an owner veto on the adopted budget. North Dakota is a declaration-driven state. The sections below set out the framework, the procedures in practice, and the recent legislative and judicial activity bearing on assessment limits.

The assessment framework

Authority to levy and allocate assessments

For condominiums, assessment authority flows from Ch. 47-04.1 and the recorded declaration. An owner submits property to the chapter by executing, acknowledging, and recording a declaration with the county recorder.⁵ That declaration must state the fractional or percentage interest each unit holds in the entire project, and that interest determines each unit's share of common expenses.⁶ The statute then directs unit owners, through bylaws attached to the recorded declaration, to provide for the maintenance of common elements and the assessment of expenses.⁷ The administrative body — the board — holds the power to levy assessments, and the recorded declaration fixes the allocation formula.

For HOAs, no dedicated North Dakota statute applies. An HOA operates under its recorded covenants and, where incorporated as a nonprofit, the Nonprofit Corporations Act, N.D. Cent. Code Ch. 10-33.² The covenants create the assessment obligation, set the amount or the method for setting it, and define the board's authority to increase it. The Nonprofit Corporations Act provides the corporate machinery — board governance, member meetings, recordkeeping — but it caps nothing and creates no assessment lien. In both settings the board adopts the budget and levies the assessment, and the controlling limit in both settings comes from the recorded instrument.

Limits on regular assessment increases

The plain rule in North Dakota: no statutory percentage cap and no budget-ratification mechanism applies to regular assessment increases. The limit, if any, comes from the declaration for condominiums or the covenants for HOAs. North Dakota has not enacted UCIOA, and Ch. 47-04.1 contains no provision that lets owners reject or veto a board-adopted budget.¹ The assessment-lien section confirms only that an assessment must be "reasonable" and "made in accordance with the recorded declaration and bylaws" — tying the validity of an increase to the recorded documents, not to a numerical ceiling.⁴

In practice, the recorded declaration or covenants govern increases directly. Instruments commonly state a base assessment with a cap on annual increases, a percentage tied to an index, or a requirement for a member vote above a threshold. Whatever the instrument provides is the operative limit. Where the instrument is silent, the board's authority is correspondingly broad, subject to the reasonableness standard in the lien section and to the board's fiduciary and corporate duties. A board that levies an increase outside the authority the declaration grants risks undermining the association's ability to secure or enforce the assessment through the statutory lien. An aggrieved owner may challenge such an increase under N.D.C.C. § 47-04.1-08, which authorizes actions to enforce or contest compliance with the declaration and bylaws.⁸

Special assessments, the lien, and the declaration

Special assessments face the same framework as regular assessments: the declaration governs authority and limits for condominiums, and the covenants govern them for HOAs. Ch. 47-04.1 does not separately define or cap special assessments, so any approval threshold, notice requirement, or dollar limit lives in the recorded instrument. For condominiums, the assessment lien arises under N.D.C.C. § 47-04.1-11: the administrative body records a notice of assessment stating the amount and the record owner's name, and a reasonable assessment made in accordance with the recorded declaration and bylaws becomes a debt of the owner and a lien on the unit.⁴ For HOAs, lien rights depend entirely on the recorded covenants — no statute creates an HOA assessment lien. Emergency special assessments operate as the declaration provides, since the statute supplies no emergency-assessment rule. The recorded documents set the limit on special assessments and define the lien rights that secure unpaid amounts.

Assessment limits and procedures in practice

A. Regular assessment increase procedure

For condominiums, the administrative body adopts a budget and levies assessments as the recorded declaration and bylaws authorize; the statute requires those bylaws to be recorded and to govern the assessment of expenses (N.D.C.C. § 47-04.1-07).⁷ Notice timing and the effective date of an increase are declaration-defined — North Dakota provides no statutory notice period for a regular condominium assessment increase. For HOAs, the declaration and the association's bylaws set the budget-adoption process, notice, and effective date under the Nonprofit Corporations Act, with no statutory percentage limit.²

B. Special assessment procedure

For condominiums, special assessment authority, notice, and any member-approval threshold come from the recorded declaration and bylaws, because Ch. 47-04.1 contains no special-assessment provision.¹ For HOAs, those same items come from the recorded covenants, with the Nonprofit Corporations Act supplying only the corporate voting and meeting framework.²

C. Caps, ceilings, and override mechanisms

North Dakota provides no statutory percentage cap on regular or special assessment increases and no budget-ratification or owner-veto mechanism for condominiums or HOAs. Any cap or override is declaration-defined or covenant-defined.¹ The only statutory constraint on a condominium assessment is that it be "reasonable" and "made in accordance with the recorded declaration and bylaws" before it can become a lien under N.D.C.C. § 47-04.1-11.⁴

D. Notice, documentation, and disclosure tied to assessments

For condominiums, an assessment becomes an enforceable lien only after the administrative body records a notice of assessment stating the amount and the record owner's name under N.D.C.C. § 47-04.1-11.⁴ Resale disclosure for both condominiums and HOAs falls under N.D.C.C. § 47-10-02.3: within ten days of executing a sale agreement — or by a mutually agreed date — the seller must provide the buyer with the periodic common expense assessment, any unpaid common expenses or special assessments currently due, the governing documents and minutes of the last two meetings, reserve and capital fund amounts, and any unsatisfied judgments or pending lawsuits in which the association is a defendant.⁹ A buyer bears no liability for unpaid assessments greater than the amount the association-prepared documents state, and the purchase contract is voidable by the buyer until the seller provides those documents.⁹

Recent legislative and judicial activity

Recent bills

North Dakota's recent legislative record includes two enacted bills that directly affect assessment and disclosure practice — one creating the resale-disclosure obligation, the other securing EV-charging rights in condominiums.

Recent appellate rulings

One North Dakota Supreme Court decision in recent years directly shapes assessment-lien practice in the state: the Gould ruling, which closed the door on HOA "super lien" claims and settled the question of lien priority.

Active legislative debates

In the 2025 session, the Legislative Assembly considered SB 2394, which would have created a new statutory chapter governing association community bylaws and boards of directors. The Senate defeated the bill on second reading, 0–46, on February 24, 2025. North Dakota's declaration-driven framework remains unchanged.

National positioning and related coverage

North Dakota occupies the declaration-driven end of the assessment-limit spectrum. At one end sit statutory-cap states, led by California, where Cal. Civ. Code § 5605(b) bars the board from imposing a regular assessment more than 20 percent greater than the preceding fiscal year's regular assessment, or special assessments that in the aggregate exceed 5 percent of the association's budgeted gross expenses, without member approval (subject to an emergency exception under § 5610). In the middle sit ratification-mechanism states in the UCIOA family — Alaska, Colorado, Connecticut, Delaware, Maine, Minnesota, Nebraska, Vermont, and Washington — which control increases by letting owners veto a board-adopted budget. North Dakota belongs with declaration-driven states such as Alabama, Arkansas, and Georgia, where assessment limits come almost entirely from the recorded declaration or covenants and the statute supplies no cap. For a multi-state operator entering North Dakota, the practical implication is clear: read the assessment limit out of each association's declaration or covenants, with no statutory ratification step to plan around. North Dakota's condominium statute is an older horizontal-property-style chapter, and the state has no comprehensive HOA framework. Federal frameworks also bear on North Dakota assessment practice, including the Fair Debt Collection Practices Act, the Servicemembers Civil Relief Act, and the bankruptcy treatment of assessments.

Recommendations

1. Start every North Dakota engagement by pulling the recorded instrument. Because no statute caps increases, the declaration (for condominiums) or covenants (for HOAs) is the only source of the cap, the increase mechanics, and any member-approval threshold. Obtain the recorded declaration and all amendments from the county recorder before advising on a proposed increase. That step will change only if North Dakota enacts a comprehensive HOA statute or adopts UCIOA — the failed SB 2394 shows neither is currently on track.
2. For condominium associations, perfect assessment liens by recording promptly. Gould makes clear that priority turns on the date of perfection and that declaration "super lien" language will not prime an earlier-perfected mortgage. Record the notice of assessment — with amount and record owner's name — under N.D.C.C. § 47-04.1-11 as soon as an assessment is due rather than waiting. This standard would shift only if a future statute creates an automatic or priority lien, as Minnesota and other UCIOA states have done.
3. For HOAs, confirm the covenants actually grant a lien. No statute creates an HOA assessment lien. If the recorded covenants do not grant one, the association's only remedy for nonpayment is a contract or corporate action, not a lien foreclosure. Audit the covenants for an express lien grant and a defined remedy on nonpayment.
4. Build a standing resale-disclosure packet. SB 2229 (effective August 1, 2025) requires associations to furnish assessment, reserve, minutes, insurance, and litigation information within ten days of a seller request. Pre-assemble the packet and adopt a disclosed, reasonable fee so the association meets the deadline and avoids the buyer's contract-voidability remedy.
5. For condominium boards, update bylaws for EV charging. HB 1310 (effective August 1, 2023) voids condominium bylaw provisions that prohibit or unreasonably restrict charging stations and carries a civil penalty of up to $1,000 for a willful violation. Replace any prohibition with reasonable restrictions and an application process that meets the statutory 60-day default-approval timeline.

Caveats

• The exact ndcourts.gov direct-URL identifier for the Gould opinion (2024 ND 32, docket 20230188) could not be confirmed; ndcourts.gov keys opinion pages to an internal numeric ID rather than the docket number. The opinion is retrievable through the ndcourts.gov opinion search by citation "2024 ND 32" or docket 20230188, and the full filed text is also mirrored on Justia and FindLaw. The holding, parties, date (filed February 22, 2024), and author (Justice Crothers) are verified against the filed opinion text.
• Effective dates for HB 1310 (August 1, 2023) and SB 2229 (August 1, 2025) reflect North Dakota's default rule that a law enacted in a regular session takes effect August 1 after filing with the Secretary of State, absent an emergency clause; neither bill carried an emergency clause per the official effective-dates-of-legislation records.
• This page describes North Dakota's statutory framework and the cited recent activity; it is not legal advice. Because limits are set by each association's recorded documents, the controlling answer for any specific association depends on its declaration or covenants, which qualified counsel should review.
• The California, UCIOA, and peer-state characterizations are provided for national positioning. The California percentages are quoted from Cal. Civ. Code § 5605(b); other states' mechanisms should be confirmed against current state law before relying on them in a multi-state matter.

1. N.D. Cent. Code Ch. 47-04.1, Condominium Ownership of Real Property ↩
2. N.D. Cent. Code Ch. 10-33, Nonprofit Corporations ↩
3. Industrial Commission of North Dakota v. Gould, 2024 ND 32 (No. 20230188, filed Feb. 22, 2024) ↩
4. N.D. Cent. Code § 47-04.1-11, Liens against units for common expenses — Removal from lien — Effect of part payment ↩
5. N.D. Cent. Code § 47-04.1-02, Recording of declaration to submit property to a project ↩
6. N.D. Cent. Code § 47-04.1-03, Contents of declaration ↩
7. N.D. Cent. Code § 47-04.1-07, Administration — Bylaws — Rules and regulations ↩
8. N.D. Cent. Code § 47-04.1-08, Compliance with covenants, bylaws, and administrative provisions ↩
9. N.D. Cent. Code § 47-10-02.3, Required disclosures — Seller to provide ↩
10. SB 2229, 69th Legislative Assembly (2025), Overview ↩
11. HB 1310, 68th Legislative Assembly (2023), Overview ↩