“Solar Panels In Indiana Community Associations” – KSN attorney Kelly Elmore discusses the new Solar Panel law passed by Indiana Governor Holcomb. She reviews what requirements both owners and board members must follow and what legal ramifications community associations can expect from this new law. (12 mins.)
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Nikki: You are listening to the KSN podcast and today we’re talking about the newly passed Indiana law regarding solar panels in community associations. Welcome to the KSN podcast where you’ll hear from KSN attorneys as they share their experience and insight on legal issues surrounding community associations, collections, property tax appeals, and landlord tenant law. I’m Nikki and today we’re joined by KSN attorney Kelly Elmore. Kelly practices condominium, townhome, and homeowner association law, and has an extensive background as a litigator. Hi Kelly. Welcome to the podcast.
Kelly: Hi Nikki. It’s great to be here.
Nikki: Our topic today is the new law Governor Holcomb just passed regarding the use of solar panels and community associations and Kelly, I know you and I were talking earlier this year that this has been a big topic for Indiana, and it has been on the table for a while now. Can you tell us exactly what Indiana house bill 1196 is?
Kelly: Absolutely. And yes, as we discussed, this has been a long time in the making and has spent considerable time in the legislature. So, on Thursday, March 10th, 2022 Indiana house bill 1196 was passed into law and in summary it provides that a homeowner’s association may require certain screening and pre approval procedures before an owner of a dwelling unit may install a solar energy system and a homeowner’s association may prohibit the installation use or removal of a solar energy system under certain circumstances.
Nikki: So, Kelly, under these two new stipulations, what are the homeowner requirements?
Kelly: So, under the new law, an eligible homeowner may petition other homeowners association members for approval to install a solar energy system on the homeowner’s dwelling unit or property. So, I think that’s the first thing to really note know is that prior to this, the law wasn’t in place, and there was no opportunity for owners to petition or to get signatures from other owners in their association. Now under this new law, the homeowner must provide information if they would like to submit a request to the HOA, including the site plan of the solar energy system to be installed, including the property boundaries, a description of the dwelling unit, the color of the solar energy system and any screenings to be used in connection with the solar energy system if the system is to be installed in the location, other than on the roof of the homeowner’s dwelling unit. In addition, some of the information required to be provided is also the vendor and installer of the solar energy system, as well as the plans and specifications for the solar energy system if requested by other homeowner association members. Petitioning owners must also, and I think this is kind of the big one, obtain the required number of signatures to amend the Association’s covenants or governing documents or obtain signatures of at least 65%, whichever is less.
So, to sort of break that down as many owners are aware in your association, when you are trying to take a vote on an issue, oftentimes there’s a required vote that’s set forth in your governing documents and you can usually find this in your declaration or covenants conditions and restrictions. And the documents will provide a specific number that you need to amend your documents. Sometimes it’s 67%, sometimes it’s 75% and we look at that number now when determining the number for a request to get signatures for the solar panel approval. And what this new law says is that you go with whatever number is less. The law says you have to have at least 65% of the association owners but if you’re governing documents, let’s say provide for 60% to amend your documents, then you would go with the 60%. So, its, whatever number is less
Nikki: And Kelly, going back to what you had said with this new law where a homeowner owner may petition for approval, how does this new law kind of differ from what board members may have been accustomed to seeing over the last few years?
Kelly: So previously up until now, associations relied on language that was already contained in their governing documents. In other words, there was no law in place. There was no specific provision or exception that allowed owners to put up solar panels. And over the years, we know there were a lot of owners who felt very strongly about this, especially with some of the arguments that were proposed related to energy savings and just overall cost savings for owners. But ultimately the way that it worked in homeowner associations is that you would typically default to the architectural review committee provisions, which often state things like an owner shall present a submission or a plan to the board or to the architectural review committee and that committee or the board would make a determination as to whether or not to allow something. In other words, the board ultimately always had the authority to determine whether or not to grant or deny a request. Well, under this new law it does specifically make a recognition that owners may want to proceed and put up solar panels on their homes and instead of simply relying on the board or the architectural review committee, now owners can go out and get the required number of signatures and as long as they’ve met the other requirements then the board is required to approve the request.
Nikki: Kelly and I are going to take a quick break, but when we get back, we’ll continue discussing the new solar panel law in Indiana community associations.
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Nikki: And we’re back. I’m here at the attorney Kelly Elmore and we’re discussing the new solar panel law that was just passed by governor Holcomb. So, Kelly, we discuss what community associations can expect to see from their fellow neighbors and unit owners in regards to the process of approving the use of solar panels. Let’s change gears a little bit and talk about what board members and property managers need to know when dealing with this new law.
Kelly: So, I think one of the most important things to note is the obligation on the board if an owner does present the required number of signatures. So, what the law says is once the homeowner has obtained the required number of signatures, and again, assuming they’ve provided all of the other required information, the owner must present the signatures and information to the board of directors. The board of directors or an architectural review committee may not deny the homeowner’s request to install the solar energy system. Once all of that information has been provided and the homeowner has obtained the required number of signatures. So, in other words, it takes what used to be maybe more of a discretionary determination by the ARC or the board and now it makes it mandatory, again, as long as all of the requirements have been met, including obtaining the required number of signatures
Now, the law also goes into detail regarding disclosure of additional information when you’re petitioning other owners in the association. As I mentioned before things like solar panel installation, solar panel energy systems, what kind of fencing, support brackets, piping might be used, roofing information warranties. So I think this law does a really nice job of comprehensively thinking about or anticipating what some of the problems might be with some of these systems and already puts the burden on an owner to think all of this through, obtain a professional proposal from an experience spender in this area and present all of the information in a single packet so that other neighbors and owners know what they’re giving their signature for, but also when the board receives the packet or the ARC, they know exactly what they are approving.
Nikki: So, to review, we’ve kind of hammered it a few times here. A homeowner has obtained enough signatures and all of the supporting information and has presented it to the board to be able to install solar panels onto their unit or home. So, Kelly, what kind of legal impacts can community associations expect to see from this new law?
Kelly: Well, I think this legislation provides a path for approval of solar panel installations to homeowners who might previously have been denied in their requests or struggled with their board or their ARC to get approval of this type of system. I think this bill also strikes a balance as it recognizes the competing interest of the homeowner association in seeking consent and approval from a super majority of the fellow owners. So, like many other association issues that we deal with from time to time that involve amendments to governing documents, this bill really anticipates that this is a homeowner association, it is community living and the community should be deciding whether or not something should or shouldn’t be allowed in the community and I think that’s really where they were going with including the provision that requires the super majority of signatures in the association.
So, I think one of the other difficulties will be trying to anticipate what might arise as far as challenges or other types of issues. So, what we’re suggesting is that when presented with inquiries your association council can assist by ensuring that the requirements of the bill have been properly followed ensuring that all of the required information has been submitted and is in compliance with the bill as well as to sustain a board in determining whether or not a request must be granted. There might be questions from board members once a packet is received and signature is received as to whether or not it is now mandatory to approve it and also sustain and reviewing a petition submitted to ensure that the individuals who sign the petition are in fact lawful owners in the association
Nikki: That was KSN attorney Kelly Elmore. Kelly practices condominium and townhome and homeowner association law and has an extensive background as a litigator. KSN is an experienced legal resource, ready to provide you with quality advice and exceptional service. We look forward to demonstrating how we’ve earned the trust of thousands of clients over the past 35 years. If you’d like to reach Kelly or any one of KSN’s experienced attorneys, please call 855-537-0500. You can also visit ksnlaw.com and complete the contact form to send us a message. Thanks for listening.
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