What is an HOA annual disclosure or policy statement?
Reviewed by the OurHOA team · Updated June 2026
What the yearly HOA policy statement and disclosure packet contain, why states like California require an Annual Policy Statement, and what owners should look for in it.
What it is
An annual disclosure or policy statement is a yearly packet an association sends to every owner that gathers, in one place, the policies and contact information you need to deal with the HOA. It's the document that tells you how to pay, who to contact, what happens if you fall behind, how to dispute a decision, and where official notices will be sent. In California these are formal, statutory documents - the Annual Policy Statement under Civil Code section 5310 and the Annual Budget Report under Civil Code section 5300 - and many other states require a comparable yearly disclosure or policy summary. Even where no statute mandates it, a well-run HOA sends something like it because it answers the questions owners ask most.
What an Annual Policy Statement contains
California's section 5310 is a useful checklist of what belongs in this kind of disclosure, because it lists the items by law: the name and address of the person to contact about association business; a general description of the assessment-collection and lien policies, including the right to a payment plan; the association's policy on enforcement and discipline; the procedure for resolving disputes, including internal dispute resolution (IDR) and alternative dispute resolution (ADR); a summary of insurance coverage; and the mailing address an owner must use to receive notices. The point is that the rights and procedures that matter most when there's a problem are spelled out before the problem happens, in a document you receive every year.
The budget report is a separate disclosure
Don't confuse the policy statement with the financial disclosure - they're two different mailings that often arrive together. The Annual Budget Report (California Civil Code section 5300, with close analogues in other states) carries the money information: the pro forma operating budget, a summary of the reserve study and reserve funding, the assessment amount and how it was set, and any anticipated special assessments. Our guide on how to read HOA financials explains how to make sense of those numbers, and our guide on whether an HOA has to show you the budget covers your right to receive and review them. The policy statement tells you the rules of engagement; the budget report tells you where the money goes.
Why it matters to owners
This packet is where your most practical rights live. The collection and lien summary tells you exactly how far behind you can fall before fees, a payment-plan right, or a lien comes into play - the same escalation our guide on HOA collections and attorney fees details. The dispute-resolution section tells you the steps you have to follow before you can take a complaint further. And the official-notice address determines whether a fine or hearing notice is even valid - if the association sends notices to the wrong address, the process can be defective. Reading this document once a year, rather than for the first time during a dispute, is one of the highest-value things an owner can do.
If your state doesn't require it or your HOA doesn't send one
Not every state mandates a formal annual policy statement, and some smaller associations simply don't produce one. That doesn't leave you without recourse: the underlying information - collection policy, insurance, contact of record, dispute procedure - still exists in the governing documents, board resolutions, and the association's records, and owners generally have a statutory right to inspect those. Our guide on how to request HOA records explains how to ask for them in writing and what response deadlines apply. If your board doesn't circulate an annual summary, requesting these policies directly gets you the same information the disclosure would have packaged for you.
What to do - and how OurHOA helps
When the annual disclosure arrives, don't toss it - read the collection, dispute-resolution, insurance, and notice-address sections, and confirm the contact and address of record are current so you actually receive future notices. If you never get one, request the underlying policies in writing. For boards, assembling an honest, accurate annual policy statement and budget report is both a legal obligation in many states and a trust-builder: it shows owners the rules are written down and applied to everyone. OurHOA helps small self-managed communities keep their policies, financials, and contact records organized in one place, so producing a clear annual disclosure is straightforward rather than a scramble. For exactly what your state requires and what your packet must include, check your governing documents and a community-association attorney.
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These guides are general education for HOA boards and residents, not legal, tax, or financial advice. Rules vary by state and by your community's governing documents - check with a professional for your situation.