There may come a time when a board will decide that towing in an HOA is necessary to mitigate parking violations. But, is a homeowners association even allowed to tow vehicles?
Towing in an HOA: Is It Legal?
In general, homeowners associations can tow vehicles within the community. But, boards must make sure that the association’s governing documents allow towing in the HOA.
State laws can also have an impact on the towing policies of planned communities. For instance, New Jersey’s Predatory Towing Prevention Act requires that homeowners associations have a contract in place with a towing company. The Act also requires associations to post signs with detailed information, including information on when parking is allowed and any fees that vehicle owners will incur as a result of the tow.
Because state laws can vary greatly on this subject, HOA boards should check their own state laws to understand what’s allowed and what’s not. Furthermore, there may also be laws in local areas that can affect towing in an HOA. Several municipalities enact their own parking and towing regulations that associations must comply with.
To avoid any problems with the law, associations should hire a towing company that stays informed and follows all state and local regulations.
Revisiting Parking Rules
Towing services may be perfectly permitted in a community, but that doesn’t mean the HOA board should immediately jump to this decision. One or two parking issues in the association do not always constitute a need for a towing company. More often than not, the board should just revisit its parking rules.
If the association currently doesn’t have well-established parking policies, it’s easy to see why vehicles are causing problems. Some of the most common parking rules an HOA should have include:
- What type of vehicles are allowed to park in the community or in certain areas
- How long vehicles can stay parked in a specific space
- Where owners can or must park their vehicles
Associations may also want to restrict street parking. For private streets located inside gated communities, HOAs typically have the authority to regulate street parking. However, public streets usually fall under the jurisdiction of local law enforcement. If there are issues with parking on public streets, an association would be better off reporting it to local authorities.
In addition to establishing parking rules, a board should be committed to HOA parking enforcement. Fines are a good way to enforce parking regulations, and most vehicle owners will follow the rules if monetary penalties are involved. But, if there are too many parking violations and the HOA doesn’t find fines to be an effective deterrent, then the board can consider towing services.
Setting Procedures for Towing
Before hiring a towing company, the association should make sure to have its towing policy in place. The policy must include the procedures that the towing company and the board will follow when faced with an improperly parked vehicle.
This includes thoroughly checking if the vehicle is, in fact, in violation of a parking rule. Towing the wrong vehicle or a vehicle that is actually parked properly can create serious problems for the association.
Most associations also allow owners to correct the violation prior to towing, with towing as a last resort should the owner fail to comply within the time period allocated. It’s also a good idea to have the towing company seek permission from the board or the HOA manager before taking any action. Towing companies should never be allowed to patrol the community and enforce the association’s rules without authorization.
Once established, the board should communicate this policy with all residents using the communication methods stipulated within the governing documents. Normally, this means sending a notice, though it’s best to supplement this by informing residents via email, newsletters, the community website, and other mediums as well.
Additionally, associations should post signs at the appropriate places. It’s also a good idea to print a copy of the policy and attach it to gate passes so that visitors can educate themselves upon entering the community.
Important Clauses to Include in a Towing Contract
Every partnership with a vendor should come with a properly executed contract, towing companies included. Before signing the agreement, boards should make sure the following are included in the towing contract:
1. Minimum Notice Required
As previously explained, towing companies should always secure confirmation from the board or the HOA manager prior to towing any vehicles. On top of that, towing companies must also provide notice before towing. This notice period can vary from association to association.
2. Pricing
One area that sparks rage from many homeowners is pricing. Typically, towing companies charge a fee to the association for each car they tow and charge another fee to homeowners if they want their vehicle back. Pricing, though, should be fair. Homeowners will understandably get mad if the price to tow is $50 per car and the price to get their car back is $250. But, no matter the pricing, it should be spelled out in the contract.
3. Indemnification
The contract must include a clause that indemnifies the homeowners associations for any errors or breaches of the law that the towing company makes. Again, boards should do their due diligence to make sure that the towing company they hire follows all state and local laws. But, some companies do manage to slip through the cracks.
To avoid getting tangled in liability, the HOA should insist on an indemnification clause. This way, the towing company absolves the association from culpability, and the association can save time and money on legal trouble.
4. Licenses and Insurance
Homeowners associations should ask the towing company for its licenses and certificates of insurance. A towing company is a vendor, too, so the HOA should treat it as such. The towing company an HOA hires should have all the proper licenses and must update its insurance policies on a yearly basis. Boards must never hire a towing company without doing a thorough background check.
A Useful Solution
Towing in an HOA can be a controversial topic, but it can also be a genuinely effective way to deal with parking problems in the community. It especially comes in handy when improperly parked vehicles create a safety issue, such as blocking the path of parking spaces of emergency vehicles.
What association boards must do, though, is establish a sound policy when it comes to towing procedures and perform their due diligence before hiring a towing company.
Navigating the ins and outs of parking policies and towing regulations can come as a challenge for many boards. This is where an HOA management company like Cedar Management Group can help. Call us today at (877) 252-3327 or contact us online to learn more about our services.
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