This article is the first in a series about changes in the MCIOA.
As anticipated, Governor Walz signed SF 1750 into law on May 12, 2026. This legislation makes numerous changes to the Minnesota Common Interest Ownership Act (“MCIOA”) that governs essentially all condominium associations as well as all townhome and cooperative associations formed on or after June 1, 1994, and any older associations that have amended their governing documents to “opt in” to being governed under MCIOA. As we often see in legislation that has not been properly vetted by the bar association and/or other stakeholders that understand the affected laws, the language contained in SF1750 includes a number of undefined terms, inaccurate references and nonsensical statements that we will have to muddle through and that will likely be the basis of litigation as associations and homeowners attempt to decipher what is meant and/or what the language actually says. In this series of articles, we will break down the various changes that the affected associations will need to make to their policies, procedures, and, potentially, their governing documents by January 1, 2027, to comply with the new requirements, as well as attempt to decipher what these vague and ambiguous provisions mean.
A major provision in the bill will place limits on the amount of fines that can be charged for many violations of the rules or governing documents. Fines for a single violation cannot exceed $100 unless the violation falls under one of several exceptions. Fines can exceed $100 for subsequent violations of the same rule or for a single violation if the conduct or violation (i) has a serious and immediate impact on the health or safety of a resident, occupant or guest; (ii) causes physical damage to another unit or a common element; or (iii) involves using the property for financial enrichment, including renting or offering for rent a unit in violation of the declaration, bylaws, or a rule or regulation prohibiting short-term or long-term rentals.
Interestingly, the statute does allow for fines that exceed $100 for violations that do not fall under any of the stated exceptions, but only if approved at a board meeting by owners of units to which a majority of the votes in the association are allocated. Given that owners do not vote at board meetings, it is unclear whether or how this exception would ever apply. An earlier version of the bill indicated that this vote was to be conducted at the annual meeting of the members, which would have made more sense than trying to conduct a vote of the members at a meeting where they do not get to vote and where the quorum requirements only apply to the board. It is unclear why the change was made from something that makes sense to this nonsensical language. Associations will now be left to try to figure it out or forgo attempting to obtain this approval until we receive clarification in the form of some sort of legislative correction or a court decision interpreting this language.
This same section of the bill made additional changes to the provisions regarding notice and a hearing for violations. Whereas previously, MCIOA only required associations to provide notice and an opportunity for a hearing before fines could be levied, an owner now also has the right to request a hearing after they have been assessed for damages that they or their tenant, guest, etc., caused to the property. This section also appears to have eliminated the current requirement that notice and an opportunity for a hearing be provided before a fine can be levied, and now allows associations to levy fines at the same time that the notice is being sent. There will also be some minor changes to the language of the violation notice.
Due to poor drafting, the new language also requires owners to request a hearing in all cases and to do so within 30 days from when they receive the notice, unless the declaration provides for a different period. It was the intent here to limit the amount of time in which an owner must request a hearing if they want one or they will be deemed to have waived that right, rather than statutorily mandating that homeowners request a hearing in every case. The statute now makes it clear that the unit owner has a right to be represented by an attorney at a hearing on a violation or an assessment for damages. The association still cannot assess the owner for any attorney’s fees incurred in connection with the violation if an owner requests a hearing (which they must do now) until after the hearing is held and a resolution is adopted upholding the fine or assessment. But now, the resolution upholding the fine or assessment must contain an explanation for doing so, and a copy of the resolution must be provided to the owner within 30 days of its adoption.
Finally, if the governing documents (which have now been defined to include the declaration, bylaws, articles of incorporation and the rules and regulations) authorize the association to impose fines for violations, associations will be required to have a list of fines for common violations and a description of the remedies available to the association in the event of a violation and to provide this list to the owners in any reasonable manner. If/when the list is amended, a copy of the amended schedule must be provided. Again, it is unclear what is meant by “common violations.” Is this based on the number of violations of that type per year or over some other period of time? We have always advised associations to adopt a fine schedule that breaks down the rules into categories (i.e., parking violations, pet violations, unapproved architectural changes, etc.) and then provides for different fine amounts based on the rule or category. This type of schedule would satisfy the new requirement, but that is unclear.
We will break down additional provisions of this bill in future articles in this series. If you have any questions about the legislation, compliance with the new statutory requirements, amending governing documents, or any other matter affecting your association, please feel free to contact the author.
