Make a Target! Goals for 2019

Make a Target! Goals for 2019

The late and legendary coach John Wooden said “The most important key to achieving great success is to decide upon your goal and launch, get started, take action, move.” Your association might benefit from setting a few goals, and then moving to achieve them. Here are some ideas for goals in the coming year: Increase the association’s reserve funds by 15%. The closer the association is to a fully funded reserve account, the more financially secure it is. Reduce assessment delinquencies by 20%. Make sure the association has all the Annual Budget Report (Civil 5300) and Annual Policy Statement (Civil 5310) items and annually provides them to owners. Improve member communication and save money by encouraging members to accept communications by email. The law now allows such a consent to be sent by electronic mail. Update the association CC&Rs and bylaws if they are the original documents or are at least 15 years old. Make sure the documents use the current Civil Code references which have been in effect since 2014. Updating the statutory references can be accomplished by board motion (in an open meeting) under Civil 4235. Review and update the rules. Remove rules discriminating against children or which are outdated and no longer enforced. Make sure the HOA has all the legally required rules. Hire an independent consultant to provide a comprehensive assessment of association maintenance and repair needs, to discover any overlooked problems before they become more expensive later. The consultant should NOT be a candidate for the work, so there is no mixed motive in their recommendations. Re-evaluate and update the association web site (or...

Ten Damaging HOA Myths

Some myths are not only wrong, but harmful. Here are ten HOA myths which create problems for communities: 1. Governing documents are boilerplate Most HOA homebuyers carefully read their purchase contract, and ignore the CC&Rs, bylaws and rules. However, those documents are binding whether or not the owner reads them. Avoid surprises – read the documents! 2. It’s my balcony In condominium associations, balconies are usually exclusive use common area. It is not “MY balcony; because it is “OUR balcony.” The owner has the exclusive right to use it, but the HOA still controls how it is used and maintained. Owners often misunderstand that exclusive use areas are owned in common and therefore still under association jurisdiction. 3. If the association is off course, I can withhold my assessment payments This is a potentially disastrous myth. Members cannot withhold or offset claims against the HOA as a defense to their assessment delinquency. Withholding assessments will result in late fees, collection costs and attorney fees increasing the problem. The better approach is to follow Civil Code 5658, by paying the disputed amount and then filing a small claims court claim seeking a refund. 4. If it’s inside my home, the HOA has no say Most (but not all) condominiums are defined by a subdivision map or condominium plan describing the unit as “airspace.” This means the member often owns the carpet on their floor and the paint on their walls while everything underneath is common area, requiring HOA permission to alter. Before opening a new doorway, check the condominium plan and CC&Rs to see if HOA permission is needed. 5....
Get Ready for the “New” Davis-Stirling Act

Get Ready for the “New” Davis-Stirling Act

On January 1, 2014, the Davis-Stirling Act moves to a more spacious new home, thanks to a major reorganization effort by the California Law Revision Commission. For the past 30 years, the Act was squeezed into Civil Code Sections 1350-1379, and as the Act grew in complexity, the individual sections became more lengthy. Next year, the Davis-Stirling Act will be found at Civil Code 4000-6150, leaving much more space and therefore allowing the Act to be much more readable. Even though this takes effect next year, homeowners, boards, managers and attorneys should not wait until December 2013 to learn about it, because there are some important substantive changes coming. Until the Davis-Stirling Act takes effect on January 1, 2014, the new law can be reviewed as 2011’s AB 805, at www.leginfo.ca.gov under “bill information”. Although the Commission’s primary purpose was to reorganize and clarify the law without changing its content, the new law does make some substantive changes. Most of the changes are technical and not controversial. However, here are 9 new sections which in 2014 could affect how your association operates. 4235 Boards can amend CC&Rs without membership vote, to change (any mentions of the outdated Act Section numbers) to the new statute numbers. 4600 A board may grant exclusive use common area rights to a member to: Accommodate a disability, Assign parking or storage, or otherwise comply with the law, without the requirement of a 2/3 membership vote. 4775(b) The association is not required to pay for a homeowner’s temporary housing if a homeowner is dislocated due to common area repair or maintenance. [This eliminates an ambiguity...
Davis-Stirling Act Reorganized, Relocated in 2014

Davis-Stirling Act Reorganized, Relocated in 2014

On Friday, August 17, Governor Brown concluded the long journey of the California Law Revision Commission’s multi-year project to reorganize the Davis-Stirling Common Interest Development Act, when he signed into law Assembly Bills 805 and 806. AB 805 relocates the Act to a different part of the California Civil Code, while AB 806 updates the many references to the Davis-Stirling Act in other California statutes to reflect the new statute numbers. The law does not take effect until January 1, 2014, which gives managers, boards and attorneys one year to familiarize themselves with the reorganized Act. Currently found at Civil Code Sections 1350-1378, the Davis-Stirling Act will then be found at Civil Code Sections 4000-6150. Until the law becomes effective on that date, it will still be found within 2011’s AB 805, which can be found at www.leginfo.ca.gov under “bill information”. The Commission’s primary purpose was to reorganize and clarify the law without making substantive changes. However, the new law does in fact enact approximately 16 substantive changes, none of which are believed to be controversial. One of the comments already circulating is that many associations are reluctant to update or otherwise amend their governing documents, due to the coming new law in 2014. However, associations do not need to avoid amending their governing documents until 2014, because the new law at Civil Code Section 4235 will specifically provide for associations to update their governing documents (CC&Rs and Bylaws) by a board vote to correct the old Civil Code references and insert the new ones. In my view, the non-partisan Commission did a commendable job on this project. The...