Arizona law requires homeowners associations to hold at least one membership meeting per year. A.R.S. §33-1248(B). This meeting is commonly referred to as the annual meeting. Oftentimes, an association holds multiple meetings throughout the year; however, the annual meeting is specifically required by statute, and it provides an association’s members the opportunity to receive a recap of the association’s activities from the preceding year, as well as a snap shot of the association’s activities for the upcoming year. The annual meeting also provides an association’s members an opportunity to chime in and make recommendations for the operation of the association, as well as to participate in the vote to elect an association’s newest members of its board of directors.
A homeowners association’s annual meeting provides an association the opportunity to address two additional requirements of Arizona law that apply to homeowners associations. First, an association’s board of directors is required to adopt an annual budget and to provide the association’s members a summary of the adopted budget. The summary provides the association’s members information on the association’s recurring expenses (i.e. landscaping, utilities, security, etc.), as well as any significant or unusual expenditures (i.e. resurfacing a pool, reroofing buildings, installing playground equipment, etc.) that the association intends to make during the year. A.R.S. § 33-124(D). In addition, if the association’s governing documents do not expressly authorize the Board to adopt an annual budget, the annual meeting provides the association’s members the opportunity to ratify the budget. Id.
Second, a homeowners association’s board of directors is required to provide an annual audit or review of the association’s financials from the preceding year. A.R.S. § 33-1243(J). If specifically required by the association’s governing documents, the annual audit may be conducted by a certified public accountant, or, if not specifically required, the annual audit may be conducted by the board of directors itself or other individual appointed by the board of directors to undertake the task. Arizona law further requires that an association’s annual audit be completed no later than 180 days after the end of the association’s fiscal year (typically December) and must be presented to the association’s members within 30 days of its completion. The annual meeting provides an opportunity to present the members the results of the annual audit.
As mentioned above, a homeowners association may hold meetings in addition to its annual meeting throughout the year; however, if there is only one association meeting that you intend to sit in on during the year, plan on attending the annual meeting as it is oftentimes the most informative and most important meeting of the year.