The draft's covenant rule, which is the part that touches boards

Section 20.1.1.6(C):

“It is not the intent of this Land Development Code to interfere with, abrogate or annul any easement, covenant, deed restriction or other agreement between private parties. If the provisions of this Land Development Code impose a greater restriction than imposed by a private agreement, the provisions of this Land Development Code will control. If the provisions of a valid, enforceable private agreement impose a greater restriction than this Land Development Code, the provisions of the private agreement will control. The City does not enforce private agreements or maintain a record of such agreements.”

Whichever instrument is stricter wins, and the city enforces neither side of the private one — nor does it keep a record of it.

Apply that to the 25 percent cap. A condominium declaration barring short-term rentals entirely is stricter than the cap, so the declaration controls and the cap adds nothing. A declaration that is silent leaves the cap as the only limit. And a declaration that permits short-term letting freely is less strict than the cap, so under the draft the cap would control — which is the only circumstance in which a Fargo association would gain a restriction it did not write.

What the cap would mean in practice

A 25 percent cap is a queue. In a twelve-unit building, three units may operate. The fourth owner is excluded by a rule they had no part in and cannot buy their way past. The draft does not say who administers the queue, and it is not the association — the licence is a city licence.

Owners will ask the board to fix it. The board cannot; saying so early avoids the fight. A city licensing cap is not an association matter, and § 20.1.1.6(C) says the city does not enforce covenants either. Neither body is a route of appeal against the other.

Units already operating will want to be counted first. The draft as published does not resolve how existing operations are treated. That is a question for the comment record, which has now closed.

Three other draft provisions that touch covenants

Solar and EV are exempted from screening. The draft's site element screening requirements “do not apply to the following: a. Electric vehicle chargers; b. Solar panels; c. Wind mills; d. Phone or cable boxes; e. Electrical meters…” The city would not require them to be screened. An architectural committee still could — and under the stricter-instrument rule, the covenant would control. Our North Dakota solar rights and EV charging pages cover where association authority sits.

Solar may encroach into setbacks. Panels and related apparatus “may project into a required rear setback by up to 10 feet and into a side setback by up to 3 feet. In all cases, however, they must be located at least 3 feet from all lot lines.”

The city would compel covenants of its own. For disturbance-zone setbacks, protection must be “established and maintained through a declaration of protective or restrictive covenant, which must be submitted for approval by the board of city commissioners… must be recorded in the Office of the Recorder for Cass County and will run with the land and continue in perpetuity and may not be amended or terminated without approval of the City.” A covenant an association cannot amend away, authored at the city's insistence.

A caution about the draft itself

Several dimensional cells in the published draft are marked “PLACEHOLDER” or carry unresolved section references. It is genuinely unfinished. Nothing in it is law, no adoption date is set, and figures not quoted above should not be relied on.

What a Fargo board can do now

Know what your declaration says about rental terms today, because right now it is the only rule. Our North Dakota short-term rentals page covers the drafting patterns.

Write down a leasing policy if you have not. Since August 1, 2025, N.D.C.C. § 47-10-02.3(2)(m) requires an association to disclose “Notice of any homeowners' association or condominium project restrictions related to the leasing of a unit” in the resale packet, within ten days of a seller's request. An unwritten policy cannot be disclosed.

Track the adoption process. The comment period is closed; the hearing is not yet scheduled. A board wanting to be heard on the 25 percent cap now has to do it at the Planning Commission and the City Commission.

What to watch next

Watch for a Planning Commission hearing date and for the next draft to see whether the 25 percent cap survives, and how existing operators are treated. Watch also whether the placeholder dimensional standards fill in, since those decide lot sizes and coverage in the districts most North Dakota associations sit in.