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A BILL TO BE ENTITLED
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AN ACT
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relating to the collection of past due assessments and certain |
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other charges by a property owners' association. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Chapter 209, Property Code, is amended by adding |
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Sections 209.0061, 209.00611, and 209.00612 to read as follows: |
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Sec. 209.0061. COLLECTION OF PAST DUE ASSESSMENTS: FEES AND |
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COLLECTION COSTS. (a) If a property owners' association's |
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dedicatory instruments authorize the association to impose late |
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fees on, or recover costs associated with the collection of, past |
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due regular or special assessments, the association may collect |
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only the following fees and costs: |
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(1) a single late fee for each past due assessment that |
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does not exceed 10 percent of the past due assessment; |
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(2) if any interest or administrative costs are |
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authorized by the dedicatory instruments, a monthly charge that: |
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(A) does not exceed one-half of one percent of |
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all unpaid past due assessments; and |
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(B) is payable directly to the association, |
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regardless of whether the amount is ultimately used to pay the |
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association's property manager; |
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(3) if the association sends a follow-up letter |
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authorized by Section 209.00611(b), a charge for attorney's fees |
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that does not exceed 25 percent of the past due assessments; and |
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(4) for a payment plan, regardless of whether the |
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association is required to offer the plan under Section 209.0062, a |
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monthly charge that does not exceed three percent of the sum of: |
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(A) the past due assessments; and |
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(B) any charges authorized by Subdivision (1), |
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(2), or (3) incurred as of the date the payment plan is accepted. |
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(b) A property owners' association may not impose a charge |
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other than the charge authorized by Subsection (a)(1) before the |
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31st day after the date the association sends the property owner a |
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letter that complies with Section 209.00611(a). |
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(c) A property owners' association may not impose attorney's |
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fees or any other charges on a property owner for: |
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(1) documentation or other information requested by |
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the owner in order to: |
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(A) confirm the amount of assessments due; or |
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(B) understand: |
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(i) an assessment or a related charge; or |
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(ii) a payment plan being offered to the |
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owner; or |
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(2) the negotiation of the terms of a payment plan. |
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(d) Subsection (c)(2) does not require a property owners' |
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association to offer a payment plan other than as required by |
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Section 209.0062. |
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Sec. 209.00611. COLLECTION OF PAST DUE ASSESSMENTS: |
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COLLECTION LETTERS. (a) A letter sent to a property owner by or on |
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behalf of a property owners' association seeking to collect a past |
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due regular or special assessment must: |
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(1) be sent to the owner by certified mail to the |
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address to which the association usually sends invoices or other |
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official communications and, if the association uses e-mail to |
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communicate with property owners, to each e-mail address provided |
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by the owner for that purpose; |
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(2) itemize each charge the association seeks to |
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collect and reference to each provision in the dedicatory |
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instruments on which the charge is based; |
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(3) state: |
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(A) a total amount certain that the association |
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claims is due; |
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(B) the date on which that amount was determined; |
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and |
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(C) that payments made after that date will be |
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credited as provided by law; |
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(4) if Section 209.0062 applies to the association or |
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the association's dedicatory instruments require a payment plan to |
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be offered, include the terms of an available payment plan that |
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complies with that section; |
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(5) state that the owner must pay the total amount |
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claimed or, if applicable, accept and deliver the first amount due |
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under the payment plan on or before the 30th day after the date the |
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letter was sent to avoid additional charges related to collection |
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of the assessments; |
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(6) provide the owner with a phone number the owner may |
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use at no cost to ask questions about the charges or the payment |
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plan terms; |
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(7) provide an address to which the owner may send a |
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check or money order as payment and notify the owner of any |
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available online payment portal; and |
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(8) notify the owner that attorney's fees and other |
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charges may be imposed and that a lawsuit may be filed to collect |
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the unpaid amount if: |
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(A) the owner does not pay the total amount |
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claimed or, if applicable, accept and deliver the first payment |
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under the payment plan in the time provided by Subdivision (5); or |
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(B) the owner accepts a payment plan and does not |
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comply with the plan. |
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(b) Not earlier than the 31st day after the date a letter |
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described by Subsection (a) is sent to a property owner, the |
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property owners' association may send a follow-up letter that |
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includes a charge for attorney's fees authorized by Section |
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209.0061(a)(3). |
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Sec. 209.00612. COLLECTION OF PAST DUE ASSESSMENTS: |
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LAWSUITS. (a) In a lawsuit filed by a property owners' association |
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to collect past due assessments, the original petition: |
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(1) must prominently state that: |
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(A) the property owner may resolve the entire |
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claim by paying, on or before the 60th day after the date the owner |
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is served with the petition, an amount certain stated in the |
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petition that the association claims is due: |
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(i) determined as of a date stated in the |
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petition; and |
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(ii) that includes only the itemized |
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amounts described by Subdivision (2); and |
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(B) any payment received after the stated date on |
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which the amount certain was determined will be credited towards |
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the amount claimed in the petition; and |
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(2) may include a claim only for the following |
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itemized amounts: |
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(A) past due regular and special assessments; |
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(B) costs or fees the association may collect |
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under Section 209.0061; |
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(C) filing fees, fees for service of process, |
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certified mail charges incurred in connection with the suit, and |
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any other charges paid by the association in connection with the |
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suit that the association is authorized to collect under the |
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dedicatory instruments; and |
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(D) additional attorney's fees in an amount that |
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does not exceed $500. |
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(b) A payment received from a property owner after the |
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stated date on which the amount certain claimed in the petition was |
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determined must be credited towards the claimed amount. |
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(c) A property owners' association may not impose any |
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additional collection-related charges in connection with the past |
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due assessments being claimed before the 61st day after the date the |
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association's petition is served on the property owner. |
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(d) A property owner must be allowed to make a payment in |
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satisfaction of the claim by check or money order to the attorney or |
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law firm representing the association. |
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(e) In a lawsuit described by Subsection (a), the court may |
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award reasonable and necessary attorney's fees as are equitable and |
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just. |
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SECTION 2. Section 209.0062, Property Code, is amended by |
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amending Subsection (a) and adding Subsection (a-1) to read as |
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follows: |
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(a) A property owners' association composed of more than 14 |
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lots shall adopt reasonable guidelines to establish an alternative |
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payment schedule by which an owner may make partial payments to the |
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property owners' association for delinquent regular or special |
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assessments or any other amount owed to the association without |
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accruing additional monetary penalties other than amounts |
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authorized by Section 209.0061. |
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(a-1) A payment plan offered by a property owners' |
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association for payment of past due assessments, regardless of |
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whether the association is subject to Subsection (a): |
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(1) may not be conditioned on payment of any amount not |
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authorized by Section 209.0061; and |
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(2) must allow the owner to pay off at any time without |
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additional penalty or requirement for further payments under the |
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plan the outstanding balance of the past due assessments and any |
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charges authorized by Section 209.0061(a)(1), (2), or (3) that were |
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incurred as of the date the payment plan was entered into [For
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purposes of this section, monetary penalties do not include
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reasonable costs associated with administering the payment plan or
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interest]. |
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SECTION 3. The heading to Section 209.0063, Property Code, |
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is amended to read as follows: |
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Sec. 209.0063. PRIORITY OF PAYMENTS; LATE OR PARTIAL |
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PAYMENTS. |
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SECTION 4. Section 209.0063, Property Code, is amended by |
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adding Subsection (c) to read as follows: |
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(c) A property owners' association must accept a partial |
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payment on any amount due to the association, regardless of whether |
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the owner is subject to a payment plan, to be applied in accordance |
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with this section. If the association uses an online payment |
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portal, the association may not block an owner's ability to make a |
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late or partial payment through the portal. |
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SECTION 5. Section 209.009, Property Code, is amended to |
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read as follows: |
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Sec. 209.009. FORECLOSURE SALE PROHIBITED IN CERTAIN |
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CIRCUMSTANCES. A property owners' association may not foreclose a |
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property owners' association's assessment lien unless the debt |
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secured by the lien includes more than $5,000 of debt described by |
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Section 209.0063(a)(1), (2), or (3) [if the debt securing the lien
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consists solely of:
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[(1) fines assessed by the association;
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[(2)
attorney's fees incurred by the association
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solely associated with fines assessed by the association; or
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[(3)
amounts added to the owner's account as an
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assessment under Section 209.005(i) or 209.0057(b-4)]. |
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SECTION 6. (a) Except as provided by Subsection (b) of this |
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section, the changes in law made by this Act apply only to |
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collection of regular and special assessments that become due on or |
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after the effective date of this Act. Collection of assessments |
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that became due before the effective date of this Act is governed by |
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the law as it existed immediately before the effective date of this |
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Act, and that law is continued in effect for that purpose. |
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(b) Section 209.0063(c), Property Code, as added by this |
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Act, applies to a payment made by a property owner on or after the |
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effective date of this Act. |
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SECTION 7. This Act takes effect September 1, 2017. |