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Panel debates and amends transparency bill for private clubs that levy perpetual dues; measure ultimately postponed
Summary
Lawmakers debated House Bill 13‑16, which would require private membership clubs embedded in real‑estate covenants to disclose budgets, dues and file a certificate of compliance; the committee adopted several amendments but voted to postpone the bill indefinitely after concerns about enforcement, self‑certification and withholding dues.
Representative Hamrick presented House Bill 13‑16 as a consumer‑protection effort aimed at private, for‑profit membership clubs that use deed covenants to impose perpetual dues. "If a private corporation is going to wield the extreme power of a real estate deed to mandate perpetual payments and threaten foreclosure, they must provide the same exact basic budgetary transparency to consumers as an HOA," Hamrick said.
The committee considered a series of amendments intended to refine definitions, require operating budgets and monthly dues disclosure, and create a certificate of compliance to be filed with the county clerk. Provisions adopted included L006 (clarifying the bill's definition of private membership club), L7 (financial and reporting requirements adopted 8–5), L8 (secure online portals and tightened timelines), L9 (notice and resident surveys before dues increases), and L12 (removing a prohibition on future covenants). An amendment (L10) that would have stripped a club's super‑priority lien status and allowed withholding of dues if a club was out of compliance failed on a recorded vote.
Committee members pressed sponsors on enforcement: who decides when a club is out of compliance, whether a self‑certified certificate of compliance is adequate, and what triggers penalties or homeowner remedies. Rep. Paschal, Rep. Phillips and others expressed concern that the certificate could be a weak, self‑attesting mechanism and that the bill could create incentives for withholding dues without clear triggers.
Outcome: after debate and several divided roll calls on amendments, committee members moved House Bill 13‑16 to postpone it indefinitely. Sponsors characterized the bill as a targeted remedy for an unusual local arrangement; some members called it "special legislation."
