Homeowners associations (HOAs) play a vital role in keeping communities maintained and financially stable. Alongside regular HOA fees, boards sometimes need to issue what’s known as a special assessment—an extra charge outside of normal dues. For many homeowners, these unexpected costs can raise questions and concerns. For board members, knowing when and how to use them responsibly is just as important.
In this guide, we’ll explain what an HOA special assessment is, how it differs from regular HOA fees, the legal requirements in Texas, and how smart HOA financial planning can reduce the need for them.
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What Is an HOA Special Assessment?
A special assessment is an additional fee charged to all homeowners in an association when the regular budget and reserves are not enough to cover a necessary expense. Unlike standard HOA fees, which are collected monthly, quarterly, or annually, special assessments are occasional and situation-based.
Common Reasons HOAs Issue Special Assessments
- Emergency repairs (ex., storm damage, plumbing failures)
- Major capital improvements (ex., roof replacement, new amenities)
- Insurance shortfalls after claims
- Unexpected increases in vendor or utility costs
- Replenishing reserve funds
In Texas, HOAs are permitted to levy special assessments if allowed by their governing documents. These charges are binding on all members, including board members themselves.
HOA Special Assessments vs. Regular HOA Fees
It’s easy to confuse HOA fees with special assessments, but there are key differences.
How HOA Fees Are Used
- Recurring payments used for everyday expenses (landscaping, utilities, pool maintenance, staff salaries).
- Budgeted in advance and collected consistently.
- Essential for smooth community operations.
How Special Assessments Are Different
- One-time or temporary fees issued outside the normal budget cycle.
- Meant for unplanned, urgent, or large-scale expenses.
- Collected in a lump sum or installments, depending on board decisions and governing documents.
Because special assessments can place financial strain on homeowners, boards should rely on them sparingly and prioritize preventive financial planning.
Texas Laws on HOA Special Assessments
Texas Property Code sets specific rules for how HOAs handle special assessments to ensure transparency and fairness:
Open Board Meeting Requirements
Boards must discuss and vote on special assessments in a meeting open to all members (Sec. 209.0051). Proper notice must be given.
Voting Rules and Ballots
If members vote on special assessments, ballots must be written, signed, or secret (per Sec. 209.0058) with secure tracking.
Payment Plan Options for Homeowners
HOAs with 15+ lots must offer payment plan options (minimum 3 months) for delinquent homeowners (Sec. 209.0062). Some restrictions apply, such as limits on repeat usage of payment plans.
Limits and Governing Documents
Texas does not impose a statewide cap on special assessment amounts, but individual governing documents (CC&Rs, bylaws) may contain restrictions.
Understanding and following these requirements helps boards avoid liability while protecting homeowner rights.
Preventing Special Assessments with Better Financial Planning
The best way to avoid frequent special assessments is through proactive HOA financial planning.
Building Reserve Funds
Maintain reserve funds to cover major repairs or replacements.
Accurate HOA Budget Planning
Account for inflation, vendor increases, and long-term maintenance needs.
Insurance Coverage and Risk Management
Ensure policies cover potential risks and gaps.
Consistent HOA Fee Collection
Prevent delinquency through clear communication and fair enforcement.
Planning Capital Projects in Advance
Spread out costs over time rather than relying on emergency assessments.
With careful planning, boards can minimize the need for special assessments, giving homeowners more financial predictability and trust in their HOA.
Smarter HOA Financial Planning for Texas Communities
HOA special assessments are a legal and sometimes necessary tool for Texas associations, but they should be the exception, not the rule. By understanding the difference between HOA fees and special assessments, following Texas legal requirements, and prioritizing long-term financial planning, boards can protect both the community and homeowners from unexpected financial strain.
At Creative Management, we help HOAs across Texas strengthen budgets, manage reserves, and handle assessments with professionalism and transparency. If your board needs guidance on HOA financial planning or special assessment management, contact us today to learn how we can support your community.