Understanding HOAs in Missouri Subdivisions

Key Takeaway: Missouri HOAs are largely private, self-governing entities. The state provides a basic corporate framework, but the specific rules and power come from the association’s own governing documents.

1. The Legal Landscape: Minimal State Oversight

No Specific “HOA Act”: Unlike some states, Missouri does not have a comprehensive law governing HOAs for subdivisions.
Primary State Law: The Missouri Non-Profit Corporation Act (Chapter 355)
- Most HOAs are incorporated as non-profits.
- This law governs corporate procedures: meetings, voting, board duties, record-keeping.
- It does not dictate specific rules about property use (e.g., fences, paint colors, rentals).
Result: Disputes between homeowners and HOAs are typically resolved internally or through civil court, not by a state agency.

2. The Real Rulebook: The Governing Documents (The HOA’s Indentures)

The HOA’s power is derived from the Indentures. This covers rules such as parking and out buildings. However the main duty of the HOA is responsibility for common areas such as streets, lighting and stormwater systems.

HOA Responsibility for Common Area Upkeep and Maintenance

This is a core fiduciary duty of the HOA Board and a key purpose for collecting assessments.

1. What Are “Common Areas”?

Common areas are any property owned collectively by all members of the HOA, rather than by individual homeowners. In a subdivision, this typically includes:

Green Spaces: Parks, medians, entranceway landscaping, and undeveloped land.
Amenities: Swimming pools, clubhouses, tennis courts, playgrounds, and walking trails.
Infrastructure: Private streets, sidewalks, stormwater drainage systems (ponds, retention basins), and streetlights (if not maintained by the municipality).
Other: Signs at the community entrance, perimeter fences, etc.

The specific list of common areas should be defined in the HOA’s Declaration of Covenants, Conditions, and Restrictions (CC&Rs).

2. The HOA’s Maintenance Duty: The “Reserve Fund”

The HOA is legally and contractually obligated to maintain these common areas for the benefit of all residents. This involves two key financial components:

Operating Fund: For day-to-day, recurring expenses.
- Examples: Lawn mowing, pool chemicals, utility bills for common area lights, trash collection for amenities, insurance for common structures, and management fees.

Reserve Fund (Crucial and Often Overlooked): For long-term, major repairs and replacements.
- Purpose: To save money over time for predictable, expensive projects.
- Examples: Resurfacing the pool, replacing the clubhouse roof, repaving private roads, repairing or replacing stormwater infrastructure, replacing playground equipment.
- Adequate Reserves: Missouri law (specifically the Non-Profit Corporation Act) implies a duty of good faith and prudent management, which includes adequately funding reserves to avoid special assessments. A Reserve Study (a professional assessment of the lifecycle and replacement cost of common elements) is a best practice to determine the correct level of funding.

3. Ramifications of Poor Maintenance

If the HOA board neglects its maintenance duties, the consequences can be severe:

Decreased Property Values: Poorly maintained common areas make the entire community less attractive, directly impacting home values.
Safety Hazards and Liability: A broken playground swing, a crumbling sidewalk, or a poorly maintained retention pond can lead to injuries. The HOA (and thus, all homeowners) can be held liable in a lawsuit.
Special Assessments: If a major repair is needed and there are insufficient reserves, the HOA must levy a special assessment—a large, one-time fee charged to every homeowner. This can cause significant financial hardship.
Legal Action by Homeowners: Homeowners can sue the HOA board for breach of fiduciary duty if they fail to maintain common areas or fund reserves appropriately, leading to waste of assets or devaluation of property.
Violation of Governing Documents: The Indentures always place the maintenance obligation on the HOA. Failure to do so is a violation of its own governing contract.

4. Homeowner’s Role and Recourse

Pay Your Dues: Regular assessments are the lifeblood that funds maintenance.
Review the Budget: Homeowners have the right to examine the HOA’s annual budget to see how much is allocated for both operating expenses and reserve funding.
Attend Meetings: Ask the board about their long-term maintenance plan and the status of the reserve fund.
Advocate for a Reserve Study: If one hasn’t been done, encourage the board to get a professional reserve study to ensure the HOA is financially prepared for future projects.

In summary, while HOAs have the power to enforce rules, their most important responsibility is the stewardship of the community’s shared assets. Proper maintenance protects homeowner investments and ensures the community remains a safe and desirable place to live.