The legal limit on HOA special assessments in Arizona is more nuanced than most homeowners expect, because Arizona’s statutory cap applies to regular annual assessments and not to special assessments directly. A.R.S. § 33-1803 prevents an Arizona planned community from raising the regular annual assessment by more than 20% over the prior fiscal year without majority member approval, but the statute is silent on the dollar amount of a special assessment, and the condominium statutes are similarly silent. That does not mean special assessments are unlimited. The real limits come from a combination of the recorded declaration, the procedural requirements built into the CC&Rs, and the implied duty of the board to act reasonably and in good faith.
The short version is this: for most Arizona homeowners and condo owners, there is no specific dollar cap or percentage cap on special assessments imposed by state statute. The limits that exist are contained in the community’s own governing documents, and those limits vary widely from one community to another. Some declarations cap special assessments at a fixed dollar amount per unit per year, some require a member vote above a certain threshold, and some give the board essentially unlimited authority. The first question to ask when faced with a special assessment is not what state law says but what the recorded declaration says.
Does Arizona law limit how much an HOA can charge in a special assessment?
Arizona statutes do not impose a specific dollar or percentage cap on HOA special assessments. The 20% cap in A.R.S. § 33-1803 applies to regular annual assessments in planned communities, not to special assessments. The actual limits on special assessments come from the community’s recorded CC&Rs.
What A.R.S. § 33-1803 actually covers
A.R.S. § 33-1803 is the statute most often cited in the special assessment context, but it is also one of the most frequently misread. Unless the community documents impose a lower limit, the statute provides that the association cannot impose a regular assessment more than 20% greater than the immediately preceding fiscal year’s assessment without majority member approval. Two things matter about that language, and both tend to get lost in the way it gets summarized.
First, it applies to regular assessments. Regular assessments are the recurring monthly or quarterly dues that fund the association’s ordinary operating budget, and they are conceptually distinct from special assessments, which are one-time or limited-duration charges imposed for specific purposes like major repairs, capital improvements, insurance deductibles, or unexpected emergency expenses. The 20% cap does not directly reach special assessments, even though boards and homeowners alike sometimes assume it does.
Second, A.R.S. § 33-1803 applies to planned communities, which are governed by Title 33, Chapter 16 of the Arizona Revised Statutes. The condominium chapter, Title 33, Chapter 9, has no analogous statutory cap. The condominium assessment statute at A.R.S. § 33-1255 governs how common expenses are assessed and how they are allocated among units, and it was amended in 2025 to address allocations in condos with both commercial and residential structures, but it does not impose a numerical cap on what the association can assess.
The practical result is that a homeowner who receives a $5,000 special assessment from a planned community HOA, or a unit owner who receives a $20,000 special assessment from a condo association, cannot point to a state statute that says the number is too high. The challenge, if there is one, has to come from somewhere else.
What the CC&Rs typically say about special assessments
Because Arizona statute is silent on the dollar amount of special assessments, the controlling source of authority is almost always the recorded declaration, and CC&Rs vary widely in how they treat the question. A few patterns show up often enough to be worth recognizing.
Many declarations include a flat dollar cap per unit per year, often something like $500 or $1,000, above which a member vote is required. Others limit special assessments to a percentage of the annual regular assessment, expressed as something like “no more than 50% of the annual assessment in any given year” without a member vote. Some declarations allow the board to impose special assessments unilaterally up to a stated threshold and require majority or supermajority member approval for anything above that threshold. And some declarations give the board essentially unlimited authority to impose special assessments for any purpose authorized by the governing documents, which is where the statute’s silence matters most, because there is no other source of numerical limit.
A smaller number of declarations require member approval for every special assessment regardless of size. That kind of provision tends to show up in older declarations or in smaller communities with active membership engagement, and where it exists, it provides a meaningful structural check on board authority.
The blog has covered when a special assessment is legal in Arizona and when it is not in more detail. The substantive analysis there turns on the declaration’s specific language, and the same is true here: a special assessment that exceeds a cap in the CC&Rs, or that skips a required vote, is not just unwelcome. It is potentially unenforceable.
What “limit” really means without a statutory cap
If the statute does not impose a numerical cap, and the declaration does not either, the question becomes whether there are any limits at all. The answer is yes, but the limits are different in kind and take more work to identify and enforce.
The first limit is purpose. A special assessment has to be for a legitimate association expense authorized by the governing documents, which means the board cannot levy a special assessment to fund a project outside its authority, to subsidize an individual board member’s preference, or to pay for something the association has no obligation to provide. Special assessments levied for improper purposes are vulnerable to challenge regardless of dollar amount.
The second limit is reasonableness and good faith. Arizona courts apply the business judgment rule to board decisions, which gives boards a meaningful zone of discretion, but that rule does not protect decisions made arbitrarily, capriciously, or in bad faith. A special assessment that is wildly out of proportion to the expense it is supposed to fund, or that singles out particular owners without justification, can be challenged on those grounds even where the declaration does not cap the dollar amount.
The third limit is procedural compliance, which is where most successful challenges actually live. Even where the declaration gives the board broad substantive authority, the board has to follow the procedural rules for how a special assessment is imposed, including any notice requirements, any meeting requirements, any vote requirements, and any documentation requirements in the CC&Rs and bylaws. A special assessment that is substantively within the board’s authority can still be invalid if the procedure was wrong, and procedural defects are often the cleanest grounds available.
The fourth limit is allocation. The amount each unit is charged has to be allocated according to the rules in the declaration, and A.R.S. § 33-1255 contains specific rules about how common expenses are allocated in condominiums. That statute was amended in 2025 to add new rules for condos with both commercial and residential structures, which means the allocation analysis has gotten somewhat more technical for mixed-use condos. Special assessments that allocate costs disproportionately, in violation of either the declaration or statute, can be challenged on allocation grounds.
The blog has also covered assessment increases when staying under the maximum is not enough, and many of the same principles apply to special assessments. Being inside the dollar number does not mean the assessment is legal if the purpose, procedure, or allocation is wrong.
What buyers and current owners should check
For prospective buyers, the special assessment clause in the declaration is one of the most important provisions to read before closing. A community with no cap on special assessments and no member vote requirement is a community where a single board decision can produce a four- or five-figure bill with little warning. A community with a meaningful cap, or with a vote requirement above a reasonable threshold, has a built-in check on how much can be assessed at one time, and that structural difference can matter substantially over a long period of ownership.
The reserve study is also worth looking at, because special assessments are most often imposed when reserves are underfunded relative to the scheduled major repairs and replacements. A community with healthy reserves can usually absorb the kinds of expenses that, in an underfunded community, would trigger a special assessment. The two questions are linked, and looking at one without the other gives an incomplete picture.
For current owners facing a special assessment, the analysis runs in this order: first, what does the declaration say about caps and vote requirements; second, was the procedure followed; third, was the purpose authorized; and fourth, was the allocation correct. If the declaration imposes a cap and the assessment exceeds it, the assessment is presumptively invalid for the amount over the cap. If the declaration requires a vote and there was no vote, the assessment is procedurally defective. If neither cap nor vote applies, the inquiry moves to whether the board acted within its authority and in good faith. The blog’s overview of understanding assessments, liens, and delinquency in Arizona HOAs covers what happens if the assessment is paid or unpaid while the dispute is unresolved.
The practical takeaway
Homeowners who expect state law to provide a numerical cap on special assessments are usually disappointed. Arizona has chosen to leave that question to the recorded declaration, which means the same legal facts can produce very different outcomes depending on which community an owner lives in. A $3,000 special assessment that would clearly violate the declaration in one community may be entirely within the board’s authority in another, and the difference often comes down to a few lines of text in a document that was recorded decades before either the board or the owner had any involvement in the community.
The right first step when faced with a special assessment is to read the declaration carefully. The right second step is to read the notice of the assessment carefully against the declaration’s procedural requirements. The right third step, if either of the first two raises questions, is to challenge the assessment promptly through the channels the governing documents provide, because special assessments that go unpaid become liens, and liens become foreclosure exposure. Waiting to challenge a defective special assessment is rarely the best move, since the procedural grounds for challenge can be weakened by delay or by partial payment.
There may eventually be a statutory cap on special assessments in Arizona. Proposals have surfaced in recent legislative sessions, and the broader trend in HOA legislation is generally toward more homeowner protections rather than fewer. For now, though, the legal limit on a special assessment in Arizona is whatever the declaration says it is, plus the unwritten limits of purpose, reasonableness, procedure, and allocation.
If you need help with your situation in Arizona, you can book a consultation directly here.