Oregon HOA Assessment Limits

1. Overview: How assessment authority and limits work in Oregon

Oregon draws no hard percentage cap on how much a homeowners association can raise its assessments. The controls here work differently: a mandatory annual budget, a reserve funding regime that sets a practical floor, and a set of notice and disclosure duties. The lien the association records against a lot for unpaid assessments sits behind any prior first mortgage on that property. Two separate statutes govern this space — planned communities fall under the Oregon Planned Community Act, ORS 94.550 to 94.783,¹ and condominiums fall under the Oregon Condominium Act, ORS Chapter 100.² Those two chapters carry separate section numbers and are not interchangeable.

Regular increases work through the budget: the board adopts an annual budget and distributes a summary to owners, with no statutory ceiling on the size of that increase.³ The reserve regime operates as a practical floor, because the budget must include whatever the reserve study identifies as needed.⁴ Special assessments draw their authority from the governing statute and the recorded declaration, and the resulting lien ranks behind any prior first mortgage.⁵

On the national spectrum, Oregon stands apart from the statutory-cap states such as California and from the UCIOA ratification-mechanism states — many of which grant a super-priority lien ahead of the first mortgage. Oregon belongs to the process-control tier: it mandates a disciplined budget, a fully funded reserve, and disclosure, while leaving the association lien subordinate to the first mortgage. The sections below set out the framework, the procedures, and recent legislative and judicial developments.

2. The assessment framework

2A. Authority to levy and allocate assessments

In a planned community, the homeowners association levies assessments and the board adopts the annual budget under the Oregon Planned Community Act.¹ ORS 94.645 directs the board to adopt a budget at least annually, and that budget must include money allocated to the reserve account.³ The declaration and bylaws govern how the association apportions common expenses among lots, and ORS 94.704 handles the assessment and payment of those expenses.⁶

In a condominium, the association of unit owners levies assessments and the board adopts the annual budget under ORS 100.483, which requires that same annual budget — including the mandatory reserve allocation.⁷ Common expenses are charged to unit owners in proportion to each unit's allocated undivided interest in the common elements, unless the declaration provides otherwise, under ORS 100.530.⁸ That section also bars an owner from claiming an offset against an assessment for the association's failure to perform, and bars an owner from escaping liability by waiving use of the common elements or abandoning the unit.⁸ In both settings, the board — not a member vote — sets the regular assessment through the budget, and the recorded declaration supplies the allocation formula.

2B. Limits on regular assessment increases, including the reserve floor

Oregon imposes no percentage cap on regular assessment increases. The board adopts the annual budget and, within 30 days, distributes a summary to all owners. In planned communities that authority sits in ORS 94.645; in condominiums, in ORS 100.483.^3,7 Neither section ties the increase to any numeric ceiling.

The reserve regime supplies a practical floor. For planned communities, ORS 94.595 requires the association to conduct a reserve study, establish a reserve account, prepare a maintenance plan, and annually determine its reserve requirements — either by conducting a new study or reviewing and updating the existing one. Those requirements apply automatically to communities recorded on or after October 23, 1999; older communities can opt in by board resolution or owner petition.⁴ The reserve account is statutorily defined to fund "major maintenance, repair or replacement of all items of common property which will normally require major maintenance, repair or replacement, in whole or in part, in more than one and less than 30 years, for exterior painting if the common property includes exterior painted surfaces," under ORS 94.595(2)(a).⁴

The condominium parallel lives in ORS 100.175, which carries a comparable reserve study, account, and maintenance plan duty covering common elements that "will normally require major maintenance, repair or replacement in more than one and less than 30 years." It exempts condominiums of one or two units.⁹

Because the budget must include the reserve allocation the study identifies, underfunding reserves becomes a statutory shortfall — not a discretionary choice. Oregon is not a UCIOA state, and neither chapter requires an owner-approval vote to adopt the budget or raise the regular assessment. Under ORS 94.595(3)(b), the board, after reviewing the reserve study or update, may adjust payment amounts as the study indicates and add other reserve items in its discretion — all without any action by owners.⁴ Any percentage cap on increases exists only if the recorded declaration creates one. A defective increase — or one that departs from the declaration's allocation formula — exposes the association to an owner challenge. Chronic underfunding of reserves can support claims of statutory violation and breach of fiduciary duty against the board.

2C. Special assessments, the assessment lien, and its priority

Special assessments draw their authority from the governing statute and the declaration, not from any standalone statutory cap. In both planned communities and condominiums, the reserve account may be used only for the purposes for which the reserves were established. The statutes restrict diverting those funds: under ORS 94.595 and ORS 100.175, the board may borrow from reserves only under a resolution with a written repayment plan, and the board "with the approval of all owners, may elect not to fund the reserve account for the following year."^4,9

The lien arises automatically when the association levies an assessment. For planned communities, ORS 94.709 gives the association a lien on the lot for unpaid assessments — including interest, late charges, attorney fees, and costs — and recording the declaration perfects that lien.⁵ The association forecloses the lien nearly as it would a construction lien under ORS 87.010, and it can maintain the lien for up to six years from the date the assessment is due.⁵

For condominiums, ORS 100.450 creates the parallel lien and foreclosure mechanism.¹⁰ Critically, ORS 94.709 makes the planned-community lien prior to all other liens except tax and assessment liens and any prior first mortgage or trust deed of record.⁵ Oregon does not provide a UCIOA super-priority. The condominium lien under ORS 100.450 is likewise subordinate to a recorded first mortgage, with one narrow notice-based exception: the association's lien can gain priority if it gives the lender 90 days' written notice of the owner's default and the lender fails to initiate foreclosure within that window.¹⁰ Operationally, the association funds reserves and — in the ordinary case — collects behind the first mortgage rather than ahead of it.

3. Assessment limits and procedures in practice

A. Regular assessment increase procedure

For planned communities (Chapter 94), the board adopts the annual budget at least annually, includes the reserve allocation determined by the reserve study, and distributes a budget summary to all owners within 30 days. The budget takes effect on adoption. If the board fails to adopt a budget, the last adopted budget continues in effect, under ORS 94.645.³ For condominiums (Chapter 100), the identical procedure and the same carryover rule appear in ORS 100.483.⁷

B. Special assessment procedure

For both planned communities (Chapter 94) and condominiums (Chapter 100), the recorded declaration defines special-assessment authority and any member-approval threshold. The statutes set no fixed percentage trigger or universal owner-vote requirement. Diverting reserve funds to non-reserve purposes is restricted: under ORS 94.595 (planned communities) and ORS 100.175 (condominiums), any election not to fund reserves for the coming year requires the approval of all owners.^4,9

C. Caps, ceilings, and override mechanisms

For both chapters, Oregon supplies no percentage cap on regular or special assessments. Any ceiling is declaration-defined. The reserve regime under ORS 94.595 and ORS 100.175 sets a funding floor, not a ceiling.^4,9 Where a recorded declaration contains a cap, that private limit controls — because no statutory cap displaces it.

D. Notice, documentation, and disclosure tied to assessments

For planned communities (Chapter 94), the board distributes the budget summary within 30 days under ORS 94.645,³ must keep the operating budget, annual financial statement, and reserve study available for owner review and duplication, and must provide a written statement of amounts due within 10 business days of an owner's request under ORS 94.670.¹¹ For condominiums (Chapter 100), the budget summary duty sits in ORS 100.483⁷ and the records, annual financial statement, and CPA-review duties in ORS 100.480.¹² The recorded assessment lien appears under ORS 94.709 (planned communities)⁵ and ORS 100.450 (condominiums),¹⁰ and planned-community resale disclosure to buyers is governed by ORS 94.580.¹³

4. Recent legislative and judicial activity

A. Recent bills

Oregon's 2026 regular session closed on March 6, 2026 — shorter than most. The most directly relevant bill for association practitioners addressed a narrow but consequential question: what happens to assessment accruals when a property transfers to a county through tax foreclosure? A 2023 housing act also amended the governing statutes directly and is included here for reference.

B. Recent appellate rulings

No published Oregon appellate decision squarely addressing assessment authority, increase validity, reserve funding, or the assessment lien was issued within the 36-month window ending June 9, 2026. The two controlling appellate decisions on the assessment lien are slightly older — they remain the leading authority on how the lien works and what it can do.

C. Active legislative debates

The only recent proposal directly on point — HB 4064 — addressed assessment accrual on tax-foreclosed property and died in committee in March 2026. No active proposal would add a percentage cap on assessments or alter the core budget, reserve, or special-assessment process.

5. National positioning and related coverage

Oregon occupies the process-control tier of the national assessment-limit spectrum. The first tier is the statutory-cap states. California leads that group: Cal. Civ. Code § 5605(b) provides that "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 the approval of a majority of a quorum of members."¹⁸

The second tier is the UCIOA ratification-mechanism states — Alaska, Colorado, Connecticut, Minnesota, Nevada, Vermont, and Washington among them — many of which grant a super-priority assessment lien ahead of the first mortgage.

Oregon sits in the third tier. It mandates the annual budget, the reserve study and funding, and disclosure — without any percentage cap — and leaves the association lien subordinate to a prior first mortgage. Oregon's distinctive features are its two parallel statutes, Chapter 94 for planned communities and Chapter 100 for condominiums, and a mandatory reserve regime that operates as a funding floor, not a ceiling. For a multi-state operator entering Oregon, compliance turns on disciplined budget, reserve, and notice procedure — and on reading each declaration's allocation formula and any private cap written into it — rather than on tracking a statutory increase percentage.

1. Oregon Legislature, Or. Rev. Stat. §§ 94.550–94.783, Oregon Planned Community Act ↩
2. Oregon Legislature, Or. Rev. Stat. ch. 100, Oregon Condominium Act ↩
3. Oregon Legislature, Or. Rev. Stat. § 94.645, Adoption of annual budget ↩
4. Oregon Legislature, Or. Rev. Stat. § 94.595, Reserve account; reserve study; maintenance plan ↩
5. Oregon Legislature, Or. Rev. Stat. § 94.709, Liens against lots; priority; foreclosure procedure ↩
6. Oregon Legislature, Or. Rev. Stat. § 94.704, Assessment and payment of common expenses ↩
7. Oregon Legislature, Or. Rev. Stat. § 100.483, Annual budget; distribution of budget summary to owners ↩
8. Oregon Legislature, Or. Rev. Stat. § 100.530, Allocation of common profits and expenses ↩
9. Oregon Legislature, Or. Rev. Stat. § 100.175, Reserve account for maintaining, repairing and replacing common elements ↩
10. Oregon Legislature, Or. Rev. Stat. § 100.450, Association lien against individual unit; priority of lien ↩
11. Oregon Legislature, Or. Rev. Stat. § 94.670, Association duty to keep documents and records; deposit of assessments ↩
12. Oregon Legislature, Or. Rev. Stat. § 100.480, Maintaining documents and records; annual financial statement ↩
13. Oregon Legislature, Or. Rev. Stat. § 94.580, Declaration ↩
14. Oregon Legislative Assembly, H.B. 4064, 2026 Reg. Sess. (Or.), Relating to acquisitions of real property by foreclosure for delinquent taxes ↩
15. Oregon Legislative Assembly, H.B. 3395, Or. Laws 2023, ch. 223, Relating to housing ↩
16. Bank of N.Y. Mellon Tr. Co. v. Sulejmanagic, 367 Or. 537, 481 P.3d 293 (2021) ↩
17. Unit Owners of Cornell Meadows Condo. v. Jensen, 321 Or. App. 623, 518 P.3d 609 (2022), rev. denied ↩
18. Cal. Civ. Code § 5605 (West) ↩