Disclosure/Code Compliance

June 25, 2024

The Balcony Bill SB 326

Condominium Balcony, Stair and Walkway Inspections and Repairs: January 1, 2025 State-Mandated Deadline.

Background

On January 1, 2020, the State legislature added California Civil Code § 5551 to require condominium associations with certain elevated exterior elements (“EEEs”) such as decks, balconies, walkways, stairs, and related railings to be inspected by January 1, 2025. This new law is often referred to as the “Balcony Bill” or SB326 as that was the bill number before being passed into law in year 2019. The cause for this legislation was due to the collapse of a balcony that caused several deaths and so the purpose of these inspections is to make sure EEEs are safe to use and if unsafe, limit access until such EEEs are repaired.

January 23, 2024

New Lender Requirements by Fannie Mae and Freddie Mac Require Current Reserve Studies To Provide For Sufficient Funding.

by Adrian Chiang

Did You Know?

New Lender Requirements by Fannie Mae and Freddie Mac Require Current Reserve Studies To Provide For Sufficient Funding.

By Adrian Chiang, Esq.

January 23, 2024

The 28-day membership comment period is not required for all proposed rule changes.

by Leena Danpour, Esq.

Did you Know?

By Leena Danpour, Esq.

The 28-day membership comment period is not required for all proposed rule changes. Yes, you heard it here.

January 9, 2023

NEW LAWS EFFECTIVE JANUARY 2023 and OTHER RECENT CHANGES IN THE LAW IMPACTING COMMUNITY/HOMEOWNERS ASSOCIATIONS

by David C. Swedelson

By: The Attorneys at SwedelsonGottlieb

Cursor_and_new_legislation_in_california_-_Google_Search-300x148 As it does just about every year, the California Legislature has made changes to the law impacting community association’s statewide. This article covers those changes effective January 1, 2023 and other recent changes in the law that are worthy of being mentioned, as they may apply to your California community association. We have included examples of the application of the new law.

Outline of what is covered in this article:

October 21, 2021

SwedelsonGottlieb Publishes Its 2021 – 2022 Disclosure And Notice Checklist

by David C. Swedelson

Disclosure_-_Overview__How_It_Works__Importance__Limitations-300x198 It is fall, and for most California community associations, it is budget season and boards and managers are in the process of preparing budgets for the 2022 fiscal year. Along with the next fiscal year’s budget, boards and managers need to be thinking of all of the disclosures that California law requires be made. That is why SwedelsonGottlieb annually publish this Checklist. The good news is that there are no major changes in the law relating to disclosures. But that does not mean that there are no other issues or disclosure requirements to consider.

There are issues that we discussed last year that need to be considered, if the association has not already taken action, including the now required balcony inspections, election rules, rental restriction changes, and accounting for bad debt associated with COVID-19.

In addition, economists are projecting inflation to hit associations in the coming year. We have already seen increased cost for materials, utilities, and insurance. Employees all over the state are demanding higher wages to return to work, which will have a trickle-down effect in every service the association receives, be it janitorial, landscape, management, or pool. Associations really need to contact their service providers, contractors and insurance broker to discuss potential increases in next years fees and costs. To respond to homeowner outcry that usually follows an increase in assessments, boards should be prepared to educate homeowners on the rising costs and the plan to keep the association financially stable.

October 11, 2021

AB-38, FIRE PREVENTION, AND NEW ESCROW DISCLOSURE REQUIREMENTS

by Adrian Chiang, Meigan Everett and Sandra L. Gottlieb

Sometimes you do not even know there is an issue until someone raises a question. Special thanks to Ryan Gesell from Cline Agency and to the managers that asked Ryan if Civil Code §§ 1102.6f and 1102.19, as added by AB-38 (2019), apply to homeowners’ associations; teaser alert: they do!

We reviewed Civil Code §§ 1102.6f and 1102.19, Government Code § 51182 which relates to the aforementioned Civil Code sections, and all related material from the Office of the State Fire Marshal who is responsible for this fire prevention program. Civil Code §§ 1102.6f and 1102.19 and Government Code § 51182 do not contain limitations or exclusions as they relate to condominiums or lots; therefore, it appears that these laws apply to both condominiums and lots/planned developments. Uggg!

Seller Disclosure Requirements

June 2, 2021

Use of Association Mailing Lists

by Sandra L. Gottlieb

Did-You-Know-300x300
Does your community association have a Membership List Use Policy and Agreement for when it grants a request for the association’s member contact list? In order to limit unrestricted use of the list, it should.

When a homeowner makes a demand for the association’s membership and contact list, aka its mailing list, it does not mean they get a free pass to use the association’s mailing list on an ongoing basis even if the owner was previously given the membership/mailing list for another purpose. That’s not the way the statute is written, and giving carte blanche would really invite abuse. If every owner could just request the membership list once for a specific purpose, which then enabled them to use it whenever they wanted indefinitely into the future, this would create nuisances and potential privacy concerns for those owners who later opted out of providing their information.

According to Civil Code Section 5225, “A member requesting the membership list shall state the purpose for which the list is requested which purpose shall be reasonably related to the requester’s interest as a member. If the association reasonably believes that the information in the list will be used for another purpose, it may deny the member access to the list. If the request is denied, in any subsequent action brought by the member under Section 5235, the association shall have the burden to prove that the member would have allowed use of the information for purposes unrelated to the member’s interest as a member.” This language, on its face, implies that a member must request to use the membership list each time they wish to make use of it, as the provision of the list requires board approval of such use and the board to make a determination that the use of the list will be association related.

November 14, 2017

2017 – 2018 DISCLOSURE AND NOTICE CHECKLIST For California Community Associations

by David C. Swedelson

SwedelsonGottlieb annually updates and publishes its Disclosure and Notice Checklist as a resource for Managers and Board Members of California Community Associations. The updated Checklist is 14 pages (there are a lot of things that California community associations are required to give notice of or disclose) and sets out what disclosures and notices California community associations are to provide to homeowners, when and how they are to be provided, as well as other considerations. Included is information regarding the Code requirements for the Annual Budget Report, the Annual Policy Statement, Fiscal Year End Disclosures, and other Additional Disclosures/Notices. We have included information regarding the recent changes to Civil Code Section 4041 relating to the solicitation of owner mailing addresses, etc. and the required New Management Disclosures. Follow this link to download your copy of this important resource.

June 29, 2016

Civil Code §5300: Amended/New FHA/VA Disclosures Required After July 1, 2016

by David C. Swedelson

By David Swedelson, Partner at SwedelsonGottlieb, Community Association Attorneys

7_New_PA_Laws_That_May_Change_Your_Life_In_2016___Patch.png As we previously reported, (follow this link) Section 5300 of the Civil Code was amended in 2015 and becomes effective as of July 1st of 2016. The changes to section 5300 of the Civil Code requires California community associations to include statements in their annual budget reports disclosing whether the Association is certified by the Federal Housing Administration (FHA) and Veterans Affairs (VA).

If an Association’s fiscal year runs on or after July 1, 2016, it will be required to include the FHA and VA required information in the Annual Budget Report.

August 27, 2015

New FHA/VA Disclosures Required in California Condo Annual Budget Reports

by David C. Swedelson

By Sandra L. Gottlieb, Esq., Senior Partner and Mark Petrie, Marketing Coordinator at SwedelsonGottlieb

On August 12, 2015, Governor Brown signed AB 596, which adds the following two new required disclosures to the Annual Budget Report for California condominium associations (this does not include planned developments or other common interest developments).

(10) When the common interest development is a condominium project, a statement describing the status of the common interest development as a Federal Housing Administration (FHA)-approved condominium project pursuant to FHA guidelines, including whether the common interest development is an FHA-approved condominium project. The statement shall be in at least 10-point font on a separate piece of paper and in the following form:

“Certification by the Federal Housing Administration may provide benefits to members of an association, including an improvement in an owner’s ability to refinance a mortgage or obtain secondary financing and an increase in the pool of potential buyers of the separate interest.

This common interest development [is/is not (circle one)] a condominium project. The association of this common interest development [is/is not (circle one)] certified by the Federal Housing Administration.”

(11) When the common interest development is a condominium project, a statement describing the status of the common interest development as a federal Department of Veterans Affairs (VA)-approved condominium project pursuant to VA guidelines, including whether the common interest development is a VA-approved condominium project. The statement shall be in at least 10-point font on a separate piece of paper and in the following form:

“Certification by the federal Department of Veterans Affairs may provide benefits to members of an association, including an improvement in an owner’s ability to refinance a mortgage or obtain secondary financing and an increase in the pool of potential buyers of the separate interest.

This common interest development [is/is not (circle one)] a condominium project. The association of this common interest development [is/is not (circle one)] certified by the federal Department of Veterans Affairs.”
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