A Common Interest Community (CIC) is a residential community where owners share responsibility for common areas such as roofs, landscaping, hallways, or amenities. CICs may include condominiums, townhomes, and many planned communities. CICs that were created after June 1, 1994, are subject to the Minnesota Common Interest Ownership Act (MCIOA), Minnesota Statutes, chapter 515B unless otherwise exempted. 

A Homeowners Association (HOA) is the organization that governs a CIC. It may be organized as a nonprofit corporation run by a board of directors elected by homeowners. The HOA maintains common areas, enforces rules, collects dues, manages finances, and protects the community’s property values.

Owner Rights and Responsibilities 

Owners often have the following rights and responsibilities:  

• Right to access governing documents and most association records. Minnesota Statutes, section 515B.3-118
• Right to receive an annual financial and insurance report. Minnesota Statutes, section 515B.3-106 (b)(2)
• Right to receive notice and an opportunity to be heard before fines are imposed. Minnesota Statutes, section 515B.3-102(a)(11)
• Right to use common areas subject to rules. Minnesota Statutes, section 515B.2-109
• Responsibility to follow governing documents and pay special assessments. Minnesota Statutes, sections 515B.3-102, 515B.3-115, and 515B.3-1151
• Responsibility to pay scheduled dues. Minnesota Statutes, sections 515B.3-115 and 515B.3-1151

HOA Powers and Responsibilities 

• Board members must act in good faith and in the best interest of the community. The governing documents of an HOA usually give the board the ability to:  
• Set budgets, maintain insurance coverage, and collect assessments (dues). 
• Maintain and repair common areas. 
• Enforce rules and issue fines (with due process). 
• Hire management companies and contractors. 

Assessments and Insurance 

Homeowners pay regular assessments for daily operations and long-term maintenance of the HOA. If funds are insufficient, the board may impose special assessments for major repairs or emergencies. 

HOAs are generally required to carry a master insurance policy covering common areas. Owners often carry an HO-6 insurance policy to cover the interior of their unit, personal property, liability, and optional loss assessment coverage to help pay certain special assessments after insured losses. 

Enforcement and Disputes 

HOAs may charge late fees, impose liens, and pursue foreclosure against homeowners in the HOA for unpaid dues. Owners should address concerns calmly, in writing, and through HOA processes such as meetings, elections, or mediation. 

If an HOA fails to follow the law or its own bylaws, owners may take action, including, but not limited to pursuing internal remedies, replacing board members, requesting mediation, or pursuing legal action.

The Minnesota Department of Commerce does not provide legal advice to consumers or associations. The information presented in this document is for informational purposes only and is not intended as legal advice.