Vermont HOA Assessment Limits

Section 1: Overview

Vermont sets no percentage ceiling on how much a common interest community may raise assessments. The statutory check is a budget-ratification mechanism, backed by a six-month super-priority lien. Any disputes proceed directly to the Vermont Supreme Court because the state has no intermediate appellate court. Communities created on or after January 1, 1999 operate under the Vermont Common Interest Ownership Act at Title 27A V.S.A., which draws from the 1994 Uniform Common Interest Ownership Act. Condominiums created before that date remain under the predecessor Condominium Ownership Act at 27 V.S.A. Chapter 15. The executive board levies regular assessments at least annually on the periodic budget under 27A V.S.A. § 3-115, with no statutory cap on the increase — subject to the ratification process at 27A V.S.A. § 3-123.¹ Special assessments follow the same ratification path, and unpaid assessments become a statutory lien under 27A V.S.A. § 3-116 that takes priority over a prior first mortgage to the extent of six months of common-expense assessments.² On the national spectrum, Vermont sits with the UCIOA ratification-mechanism states rather than the statutory-cap states led by California, and it differs from states where the recorded declaration alone controls assessment limits. The framework below sets out the authority, the limits, and the procedures that follow from these provisions.

Section 2: The assessment framework

2A. Authority to levy and allocate assessments

In a Title 27A community, the unit owners association adopts and may amend budgets, collects assessments for common expenses, and may invest association funds, with the executive board acting on the association's behalf.³ The board levies assessments at least annually, based on a budget it adopts at least annually; until the association makes its first common-expense assessment, the declarant pays all common expenses.¹ Except for limited categories such as limited-common-element costs, insurance, and utilities, the association assesses all common expenses against all units in accordance with the allocations set forth in the declaration, and the declaration states the formulas used to establish those allocations.¹ The declaration controls the allocation formula, while the statute fixes the timing and the budget basis. For condominiums created before January 1, 1999, the predecessor Condominium Ownership Act at 27 V.S.A. Chapter 15 governs the allocation and collection of common expenses, including § 1310 (common profits and expenses) and § 1324 (joint and several liability of grantor and grantee for unpaid common expenses).⁴ Certain Title 27A sections reach back to those pre-1999 communities for events occurring after December 31, 1998 under 27A V.S.A. § 1-204(a)(1), including the assessment lien at § 3-116, while a second group — including § 3-103 (executive board) and § 3-124 — reaches back under § 1-204(a)(2) for events after December 31, 2011.⁵ Notably, the budget-ratification section (§ 3-123) and the core assessment section (§ 3-115) are not on either reach-back list, so a pre-1999 condominium that has not adopted Title 27A is not bound by the § 3-123 ratification process.⁵

2B. Limits on regular assessment increases, including the ratification mechanism

Vermont imposes no percentage cap on a regular assessment increase. The statutory limit is procedural rather than numeric, codified at 27A V.S.A. § 3-123 ("Adoption of budgets; special assessments"). (In Vermont's enactment, the generic UCIOA budget section appears at § 3-123; § 3-103 in Vermont governs executive board members and officers, not budgets.)⁶ The executive board adopts a proposed budget at least annually, and not later than 30 days after adoption, the board must provide all unit owners a summary of the budget, including any reserves and the basis on which reserves are calculated and funded.⁶ The board simultaneously sets a meeting date not less than 10 days nor more than 60 days after providing the summary for owners to consider ratification.⁶ Unless a majority of all unit owners — or any larger number specified in the declaration — reject the budget at that meeting, the budget is ratified whether or not a quorum is present; if owners reject the proposed budget, the last ratified budget continues until owners ratify a subsequent budget.⁶ The check is a ratification-unless-rejected mechanism, not a no-meeting owner veto, and the rejection threshold is a majority of all owners rather than a majority of those voting. A declaration may set a larger rejection number, which is the only way a member-approval threshold tighter than the statute can arise. An increase adopted without following the summary-delivery and ratification-meeting steps is procedurally defective, leaving the prior ratified budget in force.

2C. Special assessments, the super-priority lien, and foreclosure

The executive board may propose a special assessment at any time, and that assessment takes effect only if the board follows the same ratification procedure used for budgets and owners do not reject it.⁶ An exception applies for emergencies: if the board determines by a two-thirds vote that a special assessment is necessary to respond to an emergency, the assessment becomes effective immediately, the board must provide notice promptly to all owners, and the board may spend the funds only for the purposes described in the vote.⁶ Unpaid assessments and fines create a statutory lien on the unit under 27A V.S.A. § 3-116, and recording the declaration constitutes record notice and perfection of the lien, with no further recording required.² That lien stands prior to a prior-recorded first mortgage to the extent of the common-expense assessments based on the periodic budget that would have become due during the six months immediately preceding the institution of an action to enforce the lien.² The association may foreclose the lien under 12 V.S.A. Chapter 172, but it may not commence a foreclosure action unless the owner owes at least three months of common-expense assessments, has failed to accept or comply with a payment plan, and the executive board votes to foreclose against that specific unit.² Every aspect of a foreclosure or sale must be commercially reasonable, and the lien is extinguished if enforcement does not begin within three years.² The § 3-116 lien reaches pre-1999 condominiums under § 1-204(a)(1); a pre-1999 condominium that has not adopted Title 27A otherwise relies on 27 V.S.A. § 1323, whose lien is expressly subordinate to all sums unpaid on a first mortgage of record and carries no six-month super-priority.⁷ Operationally, the super-priority means a foreclosing first mortgagee in a Title 27A community generally pays six months of assessments to preserve its position.

Section 3: Assessment limits and procedures in practice

A. Regular assessment increase procedure

In Title 27A communities, the board adopts a proposed budget at least annually, delivers a budget summary (including reserves) to all owners within 30 days of adoption, and sets a ratification meeting 10 to 60 days after the summary; the budget is ratified at that meeting unless a majority of all owners reject it, and the effective increase rests on the ratified budget (27A V.S.A. §§ 3-115, 3-123).⁶ This procedure does not bind a pre-1999 condominium that has not adopted Title 27A, because § 3-123 is not among the reach-back sections (27A V.S.A. § 1-204).⁵

B. Special assessment procedure

The board may propose a special assessment at any time, effective only through the same summary-and-ratification process unless owners reject it; an emergency special assessment takes effect immediately on a two-thirds board vote with prompt notice (27A V.S.A. § 3-123), and a declaration may set a larger rejection threshold.⁶

C. Caps, ceilings, and override mechanisms

Vermont sets no statutory percentage cap on either regular or special assessments; the ratification vote is the operative check, and any numeric ceiling exists only if a community's declaration creates one (27A V.S.A. § 3-123).⁶ This applies to Title 27A communities; pre-1999 condominiums look to their declaration and 27 V.S.A. Chapter 15.⁴

D. Notice, documentation, and disclosure tied to assessments

Title 27A requires the budget summary and ratification-meeting notice described above (§ 3-123), a recordable statement of unpaid assessments furnished within 10 business days of a request (§ 3-116(i)), and record-notice perfection of the lien through the recorded declaration (§ 3-116(e)).² The assessment lien provisions, including § 3-116, apply to pre-1999 condominiums for post-1998 events under § 1-204(a)(1).⁵

Section 4: Recent legislative and judicial activity

A. Recent bills

B. Recent rulings

A review of Vermont Supreme Court published opinions and entry orders from January 2023 through June 2026 found no precedential decision squarely addressing association assessment authority, the validity of an assessment increase or special assessment, budget ratification under § 3-123, or the assessment lien under § 3-116 or the predecessor § 1323.⁹ Because Vermont has no intermediate appellate court, the Supreme Court's published opinions are the complete appellate record. The controlling assessment-authority precedent — Will v. Mill Condominium Owners' Association, 176 Vt. 380, 848 A.2d 336 (2004) — held that the UCIOA commercial-reasonableness standard governs a § 3-116 assessment-foreclosure sale, and it predates this review window.⁹ The only in-window case in this family — an Alpine Haven Property Owners' Association entry order decided May 5, 2023 — is a non-precedential three-justice entry order resolving a motion to reopen a fee-collection judgment and an attorney's-fee award. It rests on deed-covenant law rather than the statutory assessment and lien provisions.⁹

C. Active legislative debates

The principal active debate touching common interest communities in the 2025–2026 session concerns the housing-flexibility provisions of S.328, including whether associations should be required to permit leasing, accessory dwelling units, and similar uses. The assessment, budget, and lien provisions are not part of that debate.⁸

Section 5: National positioning and related coverage

Vermont occupies the UCIOA ratification-mechanism position on the national assessment-limits spectrum. That spectrum runs from statutory-cap states led by California, where Cal. Civ. Code § 5605(b) provides that a 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 member approval;¹⁰ to ratification-mechanism UCIOA states with a super-priority assessment lien, including Vermont alongside Connecticut and Delaware, which enacted the 2008 version of UCIOA, and Washington, which adopted a UCIOA-based act;² to states where the recorded declaration alone governs assessment limits. Vermont's distinctive features are its UCIOA budget-ratification process at § 3-123 and its six-month super-priority lien at § 3-116, which together substitute a procedural check and a lender-facing collection tool for any numeric ceiling.² For a multi-state operator entering Vermont, the practical implication is clear: assessment increases face owner ratification rather than a cap, collection draws support from the super-priority lien, and any contested matter proceeds from the Vermont Superior Court directly to the Vermont Supreme Court, with no intermediate appellate layer.

This page is updated quarterly.

1. 27A V.S.A. § 3-115, Assessments for common expenses (Vermont Statutes Online) ↩
2. 27A V.S.A. § 3-116, Lien for sums due association; enforcement (Vermont Statutes Online) ↩
3. 27A V.S.A. § 3-102, Powers of unit owners' association (Vermont Statutes Online, Title 27A Chapter 3) ↩
4. 27 V.S.A. Chapter 15, Condominium Ownership Act, §§ 1301–1329 (Vermont Statutes Online) ↩
5. 27A V.S.A. § 1-204, Preexisting common interest communities (Vermont Statutes Online, Title 27A Chapter 1) ↩
6. 27A V.S.A. § 3-123, Adoption of budgets; special assessments (Vermont Statutes Online) ↩
7. 27 V.S.A. § 1323, Priority of lien (Vermont Statutes Online, Condominium Ownership Act) ↩
8. S.328, An act relating to housing and common interest communities, Bill Status (Vermont General Assembly) ↩
9. Supreme Court Published Opinions and Entry Orders (Vermont Judiciary) ↩
10. Cal. Civ. Code § 5605, Assessment increases; requirements and limitations (California Legislative Information) ↩