New Mexico HOA Board Control: When Lot Owners Must Get Elected Seats

The Homeowner Association Act is codified at NMSA 1978, Sections 47-16-1 to -16, enacted in 2013 and amended through 2019. Under it every residential planned community must organize as an association consisting exclusively of all lot owners in the development, per Section 47-16-3. The declarant, generally the developer who owns the land being developed, creates the association by recording a declaration under Section 47-16-4, and during the initial period of declarant control holds the power to appoint and remove the officers and members of the board under Section 47-16-8(A). That control is not open ended.

The Act steps control across to residents at three points. Not later than sixty days after conveyance of twenty-five percent of the lots that are part of the development, and any additional lots that may be added to the development, to lot owners other than a declarant, at least one member and not less than twenty-five percent of the members of the board shall be elected by lot owners. That is Section 47-16-8(E). The declarant keeps the power to appoint and remove the remaining three quarters at that stage. Not later than sixty days after conveyance of fifty percent of the lots, no less than thirty-three percent of the members of the board shall be elected by lot owners other than the declarant, under Section 47-16-8(F). Finally, not later than the termination of a period of declarant control, the lot owners shall elect a board of at least three members, at least a majority of whom shall be lot owners; the board shall elect the officers, and the board members and officers take office upon election, under Section 47-16-8(G). A declarant may also give up control early: Section 47-16-8(D) allows voluntary termination of the right to appoint and remove officers and board members before the period of declarant control would otherwise end.

The arithmetic is where New Mexico developers and boards go wrong, and it is the reason the Attorney General was asked to weigh in. The denominator is not the number of finished houses. A lot is defined in Section 47-16-2(O) as a parcel of land designated for separate ownership or occupancy shown on a recorded subdivision plat for a development, or the boundaries of which are described in the declaration or in a recorded instrument referred to or expressly contemplated by the declaration, other than a common area. The Department of Justice read that definition together with Section 47-16-2(P) and Sections 47-16-8(E) and (F) and concluded that the total number of lots includes all lots owned by the declarant and any additional lot that may be added to the development. In its words, those provisions indicate the total number of parcels in the development, present and anticipated, including those owned by the declarant, that must be included in the calculation of what percent of lots are owned by non-declarants. Empty platted ground and future phases therefore count against the developer, not for it.

Which subsections apply turns on whether the development is a master-planned community, defined in Section 47-16-2(Q) as a large-scale residential development that allows for a phasing of development that will take place over a long period of time, following comprehensive and coordinated planning review by a local government and approval of design and development standards beyond conventionally platted subdivisions, with the additional standards included in a site plan, area plan or master plan required by the approving local government. For a development that fits that definition, the Department of Justice held that subsections C through G of Section 47-16-8 apply and that these provisions are mandatory.

Opinion 2024-13 arose from the Mariposa subdivision in Rio Rancho, where residents reported that the association board carried no homeowner representation at all even though they believed the twenty-five percent threshold had been passed. Senator Craig W. Brandt requested the opinion, and Deputy Solicitor General Seth C. McMillan signed it for Attorney General Raul Torrez on August 27, 2024. The Department declined to run the percentage itself on the limited record, but told the declarant to follow state law and allow lot owners to elect representation. It is the second New Mexico opinion on the point: a companion opinion dated August 17, 2021 works through the same threshold calculation as an example.

The Department of Justice was explicit that the transition provisions in Section 47-16-8 are mandatory, and that a declarant which has passed the twenty-five percent threshold and still refuses to seat an elected member is out of compliance with the Homeowner Association Act. An Attorney General opinion is official guidance rather than a court order, so the practical route for owners is to document the lot count from the recorded plat and declaration, count declarant-owned and future-phase lots in the total as Opinion 2024-13 directs, and put the sixty-day deadline to the board in writing.

Opinions of this kind are requested through a state legislator or a public body, not by individual homeowners; Senator Craig W. Brandt made the request that produced Opinion 2024-13. Requests and correspondence go to the New Mexico Department of Justice at 408 Galisteo Street, Santa Fe, New Mexico 87501, telephone (505) 490-4060. The Department notes on the face of the opinion that it is a public document, is not protected by the attorney-client privilege, and is published on its website, so an owner in another New Mexico development can hand the board the same document.