Consumer Affairs asked for mandatory HOA dispute resolution. The bill carrying it never got a vote
Consumer Affairs asked for mandatory HOA dispute resolution. The bill carrying it never got a vote
2026-09-19 · South Carolina · Legislation · Did not pass
The Department of Consumer Affairs told the General Assembly what would reduce the complaints it receives, and named the bill that would do it. That bill never received a committee vote.1
H. 3350 was prefiled on December 5, 2024 by Reps. Guest, B. Newton, Pope, Taylor and Crawford, introduced January 14, 2025, and referred to House Labor, Commerce and Industry. Rep. Crawford was added as a sponsor on February 26, 2025. That is the entire history.
What it would have required
The bill amended Sections 27-30-120, -140, -150, -155, -160 and -340 of the Homeowners Association Act. Its core moves:
- A statutory definition of "internal dispute resolution process" — "a fair, reasonable, and expeditious procedure" — added to the Act's definitions.
- A requirement that every association establish one, with written requests, association participation, and written signed agreements.
- No fee charged to the member for taking part.
- Annual notice to homeowners that the process exists.
- Forty-eight hours' advance notice of any meeting at which a budget increase is decided.
- Magistrates court jurisdiction "over all matters between a homeowner and a homeowners association."
Why the last item was the largest
Magistrates court is South Carolina's small-claims forum: cheap, fast, and usable without a lawyer. Its civil jurisdiction is capped at $7,500. Routing association disputes there would have changed who can realistically bring one.
The alternative, today, is the Court of Common Pleas — where the filing costs, the discovery and the near-necessity of counsel mean the expense of contesting a fine routinely exceeds the fine.
The Department's own recommendations
In its 2026 annual report, covering calendar 2025, the Department of Consumer Affairs put four proposals to the General Assembly, and footnoted that H. 3350 "encompasses several of these recommendations." The four:
- A mandated internal dispute-resolution process inside each association, made known to members, under a flexible statutory framework.
- Extending the Nonprofit Corporation Act's voting provisions — Sections 33-31-708 and 33-31-721 through 33-31-724, on ballot content, votes per member, quorum, majorities and proxies — to associations whose bylaws are silent on voting.
- Expanding magistrate's court authority.
- Requiring an association answering a complaint to attach the governing-document provision it relies on.
Complainants asked for the same things. Internal dispute resolution was the remedy 48.5% of them named; on enforcement generally, 31% wanted state agency oversight, 26% internal dispute resolution, 16.8% magistrate's court and 16.6% an ombudsman.
Why the Department keeps asking
Its own process is voluntary mediation. The report states that the Department cannot compel an association to participate, cannot require an outcome, and cannot arbitrate. Nineteen per cent of 2025 complaints closed as "undetermined" because the facts were disputed — up four points year on year, an increase the Department attributes directly to those limits.
An internal process inside the association, or a magistrate who can decide, are both answers to a problem the Department says it cannot solve with the authority it has.
What exists instead
South Carolina requires no association to offer any dispute procedure. Where governing documents create one — a hearing before the board, an appeal, a mediation clause — it binds as a matter of contract, and its terms are whatever the declaration says. Where the documents are silent, there is no default.
The 48-hour budget-increase notice in Section 27-30-140 already exists, but with a carve-out the bill would have addressed: subsection (2) provides that the section does not apply to an association incorporated under the Nonprofit Corporation Act. H. 3350 would have extended notice obligations past that boundary.
The Department's complaint process remains available and free, and it produces the data in the annual report. What it does not produce is an enforceable outcome, which is why where a South Carolina dispute can actually be decided remains the practical question.
Opposition, and the record
The Community Associations Institute's South Carolina chapter opposed H. 3350, and describes it in its end-of-session report as having died in committee.2 As with the rest of the term's association bills, the record shows a referral and no committee vote rather than a bill weighed and rejected.
Everything resets in January 2027. A refiled version starts at first reading.
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