California legislative updates: HOA election reform and more (Oct. 2019)

By Deborah Goonan, Independent American Communities
debgoonan@icloud.com

It took two years, but this week, Governor Newsom signed an important HOA Election Reform bill that will change the HOA election process “by ensuring that HOA members are not disenfranchised,” according to Senator Bob Wieckowski [D-Fremont].

The new law makes several changes to the Davis Stirling Act, and applies to all common interest communities in the state of California.

For starters, all association-governed communities are now required to hold an election at least every four years. The law also prevents HOA boards from limiting the candidate pool by hand-picking their allies through a nominating committee.

California HOAs must also allow any member to run for election to the board, with just a few narrow exceptions. Those exceptions must be specified in the Association’s bylaws.

SB 323 was supported by the Center for California Homeowner Association Law (CCHAL), California Alliance for Retired Americans (CARA), American Civil Liberties Union, Greater Sacramento Urban League and the Nonprofit Housing Association of Northern California.

Supporters say the reform measures are necessary to ensure that homeowners with opposing views or different priorities have a chance to unseat incumbent boards that don’t serve the interests of all members of the community.

CCHAL, in particular, says it hears from many homeowners who complain that their HOA avoids holding elections. Owners also say that their HOA board creates unnecessary or bogus nomination requirements, which are then used to disqualify certain opposing candidates from being placed on election ballots.

Vote HOA election scrabble
(Pixabay.com free image)

Trade group opposition to Election Reform

Trade group Community Associations Institute, through their California Legislative Action Committee (CAI-CLAC) loudly opposed SB 323. The trade group circulated dozens of email and social media campaigns which grossly misrepresented the contents of the bill.

CAI-CLAC instead sponsored its own Election by Acclamation bill, SB 754, which was also signed by the Governor this week.

SB 754 allows California common interest communities to avoid the expense of holding an election when the number of candidates does not exceed the number of open seats on an HOA board.

However, during the course of this session’s legislative process, SB 754 was amended to add restrictions on election by acclamation, to prevent HOA boards from prematurely closing the candidate nomination process.

Election by acclamation provisions are now subject to all of the following conditions. 

  • The association consists of at least 6,000 units.
  • The association provides at least 30 days advance notice of a call for board nominations. Written notices must be sent to each individual HOA member.
  • The association cannot disqualify candidates, in violation of exceptions allowed by the provisions of SB 323.

Due to opposing interests of advocacy groups, state Legislators ultimately reached a compromise.

Election by Acclamation provisions of SB 754 were rolled into SB 323, while Election Reform provisions of SB 323 were rolled into SB 754.

Similar legislation passed both House and Senate in 2018, only to be vetoed by then Governor Jerry Brown.

This year, SB323 and SB 754 were both signed into law by Governor Gavin Newsom.

For further details about both bills, see this previous IAC post.

California HOA election bills await Governor’s signature

 

Other new California legislation

CA SB 652 – Display of religious objects

As of January 1, 2020, no landlord or homeowners, condominium, or cooperative association can prohibit a resident from displaying a religious object on the entry door or doorframe to that resident’s unit.

Tenants and HOA residents may place one or more objects on the door or door frame of their dwelling, provided the size does not exceed 36 by 12 square inches.

Items placed on a door cannot include vulgarities, and cannot interfere with safe operation of the door. A landlord or HOA can require a resident to temporarily remove items for the purposes of maintaining or replacing the door.

The law defines a “religious item” as “an item displayed because of sincerely held religious beliefs.”

The new civil code invalidates any conflicting restrictive covenants.

Read SB 652

Source:

Little Italy dispute spurs new law protecting religious displays outside homes
Posted: 11:33 AM, Aug 02, 2019
Updated: 8:44 PM, Aug 02, 2019
By: Natay Holmes

SB 326 “Balcony Safety Bill”

Readers of IAC can read several previous posts about unsafe balconies on this website. A 2015 Berkeley catastrophic balcony collapse that resulted in 6 fatalities was the inspiration for legislation last year (SB 721).

Last year’s balcony safety bill was opposed by various advocacy groups, including Community Associations Institute – California Legislative Action Committee (CAI-CLAC). SB 721 was also opposed by many condominium homeowners, who feared the high cost of regular balcony inspections.

Last year’s legislation required a costly, invasive procedure to examine the interior structure of 15% of elevated elements every 6 years.

SB 721 was ultimately signed into law, but only after HOA-governed communities were excluded from inspection requirements.

This year SB 326 addresses balcony safety responsibilities of condominium associations, as opposed to landlords of rental properties.

CAI-CLAC and the Executive Council for Homeowners (ECHO) took an active role in writing SB 326, thus gaining the endorsements of both organizations.

California law now requires condominium and cooperative associations to inspect balconies and other suspended wood structures no later than 2025.

After January 1, 2020, new buildings have six years to complete an inspection.

After the initial inspection, associations must repeat the safety inspection once every 9 years.

The safety inspection requires a licensed structural engineer or architect to conduct a visual inspection of a representative sample of suspended wooden structures at least 6 feet above the ground. Intrusive inspections are not required, but at the discretion of the inspector.

Removing the ‘poison pill’

SB 326 was made more acceptable to CAI-CLAC and ECHO because it includes provisions that outlaw a real estate developer’s. declarant’s or home builder’s ‘poison pill’ provisions in governing documents of an association-governed community.

A ‘poison pill’ provision is one that makes it difficult or nearly impossible for an HOA to sue the developer, declarant, or home builder when it discovers construction defects.

For example, in recent years, some governing documents require a full membership vote before an HOA board can file a legal action against a developer.

The controversial provisions have been challenged by litigation in several states, including Massachusetts. In 2017, that state’s Supreme Judicial Court ruled that provisions in condo documents that require a full membership vote on the issue of suing a developer are blatantly unfair and, therefore, illegal.

In California, as of January 1, 2020, state law makes such ‘poison pill’ provisions illegal. The law is retroactive, meaning it applies to all existing HOA-governed common interest communities.

Read SB 326. ♦

Sources:

Echo Supported “Balcony Safety Bill” Signed into
Law ( by J. Spencer Edgett, Esq.) ECHO – Executive Council for Homeowners
1671 The Alameda, Suite 205 | San Jose, CA 95126

Berding – Weil alert Governor Signs SB-326: Requires Condo Balcony Inspections, Abolishes Member Vote to Commence CD Litigation

6 who died in Berkeley balcony collapse are identified; inquiry begins
By TRACEY LIEN, MAURA DOLAN, JOSEPH SERNA
JUNE 16, 2015
6:15 PM