Assessment caps

Why there is no single cap to memorize

Boards and owners both tend to assume a national rule exists, something like "an association can never raise dues more than X percent a year." No such rule exists. Some states cap what a board can do on its own authority, others cap nothing and instead control the process, and some say almost nothing at all. Confirm which category your state falls into, and read your own declaration, since it can set stricter limits than the statute does.

What follows are two real, opposite examples: California, which sets a hard percentage ceiling, and Texas, which sets none. Neither number transfers to the other state, and neither transfers to yours.

California: a percentage ceiling on board authority

In California, a board can raise the regular assessment on its own, but only up to a fixed ceiling above the prior year's budget. Anything above that line needs a membership vote.

"The board may not impose a regular assessment that is more than 20 percent greater than the regular assessment for the association's preceding fiscal year."

Source: California Civil Code §5605, California Legislative Information

Special assessments get a separate, smaller ceiling in California, capped as a share of the year's budgeted expenses rather than a year-over-year percentage. This figure has changed by legislative amendment before, so confirm the current statute text rather than repeating a remembered number.

Texas: no percentage cap, but an open-meeting rule

Texas takes a different approach to the same problem. There is no statewide ceiling on how much a board can raise assessments. Instead, the law controls where and how the decision gets made.

"[The board] may not, unless done in an open meeting for which prior notice was given to owners" consider or vote on increases in assessments, levying of special assessments, or a budget amendment that increases the budget by more than a set percentage.

Source: Texas Property Code §209.0051, Texas Legislature (via Onecle)

The practical effect: a Texas board cannot decide a large increase informally between meetings, or bury it in an unrelated agenda item. Owners must have had notice and the chance to be in the room. Whether owners can then vote the increase down, rather than just watch it happen, depends on your declaration.

Emergencies are usually treated differently

Even where a percentage cap exists, it typically has a carve-out for genuine emergencies, and for unforeseeable extraordinary costs. California's cap statute does not apply to increases necessary for emergency situations. For the broader category of an unforeseeable extraordinary expense, the board cannot simply declare an emergency; it has to document why.

"[The board must] pass a resolution containing written findings as to the necessity of the extraordinary expense involved and why the expense was not or could not have been reasonably foreseen."

Source: California Civil Code §5610, California Legislative Information

The industry trade body representing associations takes the same general position: boards should be able to raise emergency money to correct a threat to life or safety without waiting on a membership vote. That is a policy position, not a statute in every state, so treat it as the direction the field is moving rather than a guaranteed rule where you live.