ATLANTA, Ga. (Atlanta News First) - Georgia lawmakers took a step toward addressing homeowners association (HOA) oversight Tuesday as the Senate Rules Committee held its inaugural hearing on legislation that could provide state regulation for HOAs affecting more than 2 million residents.

The hearing focused on Senate Bill 361, proposed by state Sens. Matt Brass, R-Newnan, and Donzella James, D-Atlanta, during the 2024-2025 session. The bill would raise the foreclosure threshold from $2,000 to $4,000 and prevent fines from counting toward that amount.

It would also require HOAs to register with the Secretary of State’s office for oversight. The bill also looks to add HOA dues to escrow, so dues will be paid with mortgage to a bank, providing more balance between the HOA’s ability to foreclose, while still holding homeowners accountable for paying dues.

It’s unclear if these changes would apply to existing HOAs or only newly established HOAs.

Currently, Georgia HOAs operate without state, county or city oversight. Homeowners facing disputes must pursue costly court battles, while HOA boards can add their attorney fees to homeowner dues.

Noula Zaharis, assistant commissioner of securities and director of the Secretary of State’s securities & charities division, recommended requiring HOAs to register as official charities with her office. She also requested resources to create a dedicated HOA oversight board for enforcement.

The proposed framework would include a $100 annual registration fee and require HOAs to submit financial documents. Financial transparency has emerged as a primary concern among homeowners who pay dues, assessments, fines and fees but cannot obtain itemized receipts for expenditures.

While Georgia law requires HOAs to disclose financial documents to members, homeowners often must seek court orders to view records. Atlanta News First Investigates found some boards ignore these orders.

Lawmakers discussed adding HOA oversight staffing to appropriations discussions. The Secretary of State’s office noted its cemeteries board is already overworked with 15 staff members, comparing it to Alabama’s similar office with 50 employees.

About two dozen Georgia homeowners attended the hearing, expressing concerns about management companies profiting from HOA operations and payment portal lockouts that prevent dues payments when fines are assessed. Some homeowners also raised issues with board members who were not legally elected by community vote.

Brass acknowledged previous legislative failures and committed to action this session.

“I take full responsibility for not getting anything done last year,” Brass told homeowners. “The laws are bad right now. We’re gonna make sure we get it right and we’re gonna make sure we get it done this session.”

In 2024, lawmakers approved amendments to the Property Owner’s Association Act, but HOAs must opt into the act and no office oversees compliance.

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