HB2338 • 2026

Real Property

AN ACT to amend Tennessee Code Annotated, Title 66, relative to property owners' associations' responsibility to maintain fidelity bonds.

Labor Taxes

Enacted

This bill passed the Legislature and reached final enactment based on the latest official action.

Sponsor: Hemmer, Yarbro
Last action: 2026-04-23
Official status: Comp. became Pub. Ch. 731
Effective date: Not listed

Plain English Breakdown

Using official source text because the generated explanation was unavailable or could not be confirmed against the official bill text.

Real Property

This bill requires a homeowners' association or a unit owners' association (together, a "HOA") collecting assessments for common expenses to obtain and maintain a blanket fidelity bond to insure the HOA against losses resulting from theft or dishonesty c ommitted by the officers, directors, or persons employed by the HOA, or committed by any managing agent or employee of the managing agent.

What This Bill Does

This bill requires a homeowners' association or a unit owners' association (together, a "HOA") collecting assessments for common expenses to obtain and maintain a blanket fidelity bond to insure the HOA against losses resulting from theft or dishonesty c ommitted by the officers, directors, or persons employed by the HOA, or committed by any managing agent or employee of the managing agent.
Such bond or insurance policy must generally provide coverage in an amount equal to the reserve balances of the ass oc iation plus 1/4 of the aggregate annual assessment income of such HOA.
However, the minimum coverage amount must be $10,000.
The board of directors or managing agent may obtain such bond or insurance on behalf of the HOA.

Limits and Unknowns

This entry is temporarily using official source text because the generated explanation could not be confirmed against the official bill text during the last sync.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HA0744

Amendment 1-0 to HB2338

Plain English: Amendment No.

Amendment No.
1 to HB2338 Hemmer Signature of Sponsor AMEND Senate Bill No.
2326* House Bill No.
2338 HA0744 015607 - 1 - by deleting SECTION 2 and substituting: SECTION 2.

SA0694

Amendment 1-0 to SB2326

Plain English: Amendment No.

Amendment No.
1 to SB2326 Yarbro Signature of Sponsor AMEND Senate Bill No.
2326* House Bill No.
2338 SA0694 015607 - 1 - by deleting SECTION 2 and substituting: SECTION 2.

Bill History

2026-04-23 Tennessee General Assembly
Comp. became Pub. Ch. 731
2026-04-23 Tennessee General Assembly
Effective date(s) 01/01/2027
2026-04-23 Tennessee General Assembly
Pub. Ch. 731
2026-04-13 Tennessee General Assembly
Signed by Governor.
2026-04-02 Tennessee General Assembly
Transmitted to Governor for action.
2026-04-01 Tennessee General Assembly
Signed by H. Speaker
2026-03-30 Tennessee General Assembly
Signed by Senate Speaker
2026-03-26 Tennessee General Assembly
Sponsor(s) Added.
2026-03-26 Tennessee General Assembly
Comp. SB subst.
2026-03-26 Tennessee General Assembly
Enrolled and ready for signatures
2026-03-26 Tennessee General Assembly
Passed H., Ayes 91, Nays 0, PNV 0
2026-03-26 Tennessee General Assembly
Am. withdrawn. (Amendment 1 - HA0744)
2026-03-26 Tennessee General Assembly
Subst. for comp. HB.
2026-03-26 Tennessee General Assembly
Rcvd. from S., held on H. desk.
2026-03-23 Tennessee General Assembly
Engrossed; ready for transmission to House
2026-03-23 Tennessee General Assembly
Passed Senate as amended, Ayes 30, Nays 0
2026-03-23 Tennessee General Assembly
Senate adopted Amendment (Amendment 1 - SA0694)
2026-03-20 Tennessee General Assembly
Placed on Senate Regular Calendar for 3/23/2026
2026-03-19 Tennessee General Assembly
H. Placed on Regular Calendar for 3/26/2026
2026-03-18 Tennessee General Assembly
Placed on cal. Calendar & Rules Committee for 3/19/2026
2026-03-11 Tennessee General Assembly
Rec. for pass; ref to Calendar & Rules Committee
2026-03-10 Tennessee General Assembly
Recommended for passage, refer to Senate Calendar Committee
2026-03-09 Tennessee General Assembly
Placed on Senate Commerce and Labor Committee calendar for 3/10/2026
2026-03-09 Tennessee General Assembly
Rule #83(8) Suspended, to be heard in Senate Commerce & Labor Committee on 3/10/2026
2026-03-04 Tennessee General Assembly
Placed on cal. State & Local Government Committee for 3/11/2026
2026-03-04 Tennessee General Assembly
Rec. for pass by s/c ref. to State & Local Government Committee
2026-02-25 Tennessee General Assembly
Placed on s/c cal Cities & Counties Subcommittee for 3/4/2026
2026-02-09 Tennessee General Assembly
Sponsor(s) Added.
2026-02-05 Tennessee General Assembly
Assigned to s/c Cities & Counties Subcommittee
2026-02-05 Tennessee General Assembly
P2C, ref. to State & Local Government Committee
2026-02-05 Tennessee General Assembly
Passed on Second Consideration, refer to Senate Commerce and Labor Committee
2026-02-04 Tennessee General Assembly
Intro., P1C.
2026-02-02 Tennessee General Assembly
Filed for introduction
2026-02-02 Tennessee General Assembly
Introduced, Passed on First Consideration
2026-02-02 Tennessee General Assembly
Filed for introduction

Official Summary Text

This bill requires a homeowners' association or a unit owners' association (together, a "HOA") collecting assessments for common expenses to obtain and maintain a blanket fidelity bond to insure the HOA against losses resulting from theft or dishonesty c
ommitted by the officers, directors, or persons employed by the HOA, or committed by any managing agent or employee of the managing agent. Such bond or insurance policy must generally provide coverage in an amount equal to the reserve balances of the ass
oc
iation plus 1/4 of the aggregate annual assessment income of such HOA. However, the minimum coverage amount must be $10,000. The board of directors or managing agent may obtain such bond or insurance on behalf of the HOA.

ON MARCH 23, 2026, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 2326, AS AMENDED.

AMENDMENT #1 changes the effective date of the bill from July 1, 2026, to January 1, 2027.

Current Bill Text

Read the full stored bill text

SENATE BILL 2326
By Yarbro

HOUSE BILL 2338
By Hemmer
HB2338
012636
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 66,
relative to property owners' associations'
responsibility to maintain fidelity bonds.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Title 66, Chapter 27, is amended by adding
the following as a new part:
66-27-901.
As used in this part:
(1) "Board of directors" means the body, regardless of name, designated
in the declaration to act on behalf of a homeowners' association;
(2) "Declaration" means an instrument, however denominated, that
creates a homeowners' association, and amendments to that instrument,
including restrictive covenants, bylaws, and similar instruments governing the
administration or operation of a homeowners' association; and
(3) "Homeowners' association" or "HOA":
(A) Means an incorporated or unincorporated association owned
by, or whose members consist primarily of, the owners of the residential
property covered by the declaration and through which the owners, or the
board of directors or similar governing body, manage or regulate the
residential subdivision; and
(B) Includes a unit owners' association organized under § 66-27-
401.
66-27-902.

- 2 - 012636

A homeowners' association collecting assessments for common expenses shall
obtain and maintain a blanket fidelity bond to insure the HOA against losses resulting
from theft or dishonesty committed by the officers, directors, or persons employed by the
HOA, or committed by any managing agent or employee of the managing agent. Such
bond or insurance policy must provide coverage in an amount equal to the reserve
balances of the association plus one-fourth (1/4) of the aggregate annual assessment
income of such HOA; provided, that the minimum coverage amount must be ten
thousand dollars ($10,000). The board of directors or managing agent may obtain such
bond or insurance on behalf of the HOA.
SECTION 2. This act takes effect July 1, 2026, the public welfare requiring it.