Workshop Update: Regulators Continue Considering $10,000 HOA Fine Rule Connected to HSW

Nevada regulators held a rulemaking workshop this week on a proposal that could allow homeowners associations to impose fines of up to $10,000 per violation under a category known as “health, safety, or welfare” (HSW). For Background see our post: HOA Fines Up to $10,000.

The proposed regulation remains under active consideration by the Commission. Based on workshop discussion, changes are expected. However, industry participation was strong and in several respects positions that differ from homeowner concerns. Commissioners need to hear directly from homeowners before any final regulation is adopted — which could occur as early as the June 9, 2026 Commission meeting. Do not wait. Take a few minutes and sent them an email. Make your voice heard.

HOAs as public safety agencies

Agreement on Drafting Problems

Several parties have submitted comments on the proposal, including industry counsel (CAI-LAC) and NVHOAReform. Despite broader policy differences, both sets of comments identify legitimate concerns:

• Criminal Law References: The draft incorporates criminal statutes when defining HSW violations. HOA boards do not have authority to determine whether criminal laws have been violated. Such determinations normally require investigation by law enforcement and adjudication by courts.

• Lack of an Appeal Mechanism: The proposal refers to “fine appeal provisions” that do not clearly exist in statute. Both commenters note that regulations should not rely on appeal mechanisms that are not established in law.

Where the Policy Approaches Differ

The central disagreement concerns how broadly HSW violations should be defined. Industry comments emphasize flexibility so associations can respond to a wide range of situations.

NVHOAReform takes the opposite view.

Because an HSW classification removes statutory fine limits, the definition should be narrow, objective, and limited to clearly identifiable hazards. Broad or subjective definitions could allow ordinary community disagreements to be escalated into high-penalty enforcement actions.

No Appeal Options?

Negligence Standard: The proposal introduces language based on a “failure to exercise reasonable care.” This general negligence concept can apply to a wide range of everyday conduct and may grant boards significant discretion in determining when conduct threatens safety.

Harassment and Interpersonal Conduct: Provisions addressing harassment and intimidation raise additional concerns. Determining intent and credibility typically requires independent investigation and adjudication — functions not easily replicated in internal HOA hearings.

The “Imminent Threat” Problem: Perhaps most significantly, the draft focuses on conduct posing an “imminent threat.” If a threat is truly imminent, the appropriate response is usually immediate intervention by public authorities — not an HOA enforcement process involving notice, hearings, and fines imposed weeks later. HOA fines function primarily as after-the-fact sanctions, not emergency safety responses.

Why This Rule Matters

Most HOA boards act responsibly and rarely encounter situations involving serious safety concerns. But regulatory systems should be designed not only for typical circumstances — they must also ensure that enforcement authority is clearly defined, appropriately limited, and resistant to misuse.

A rule contemplates allowing fines of up to $10,000 per violation. This would place extraordinary enforcement authority in the hands of volunteer boards operating through internal hearing processes where meaningful appeal options may be limited, costly, or uncertain.

The proposal also raises a broader policy question: Should private HOA boards be given authority to impose penalties of this magnitude based on determinations traditionally handled by public safety agencies and courts?

NVHOAReform Position

NVHOAReform opposes any rule that would increase HOA fine authority that materially increases the limits that have governed Nevada communities for many years. Giving private boards the power to classify conduct as a “health, safety, or welfare” violation and impose fines of up to $10,000 risks transforming ordinary disputes into high-stakes enforcement actions.

Regulators seek new HOA fine authorities

Homeowners Still Have Time to Act

The rule has not yet been finalized. Homeowners can still make their voices heard.

NVHOAReform strongly encourages residents to review the proposal and submit respectful comments to the CIC Commission at: mgallo@red.nv.gov

When regulators hear primarily from industry representatives, final rules often reflect industry priorities. Clear input from homeowners can help ensure that regulations protect the people who actually live in Nevada’s HOA communities.

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Sample Comment

Subject: Oppose Increasing HOA Fine Authority, Section 2, LCB File No. R091-25

Dear Chair and Members of the Commission,

I oppose any rule that would allow HOA fines to increase beyond the limits that have existed in Nevada law for over twenty years. Giving volunteer HOA boards authority to classify conduct as a “health, safety, or welfare” violation and impose extraordinary fines creates a serious risk of misuse. Once such fines are imposed, homeowners often have limited, costly, and uncertain avenues for independent review.

I respectfully urge the Commission not to adopt any rule that increases HOA fine authority beyond the limits already established in Nevada law.

Sincerely,

[Name]

[City / HOA Community]