Bill Text: CA AB466 | 2011-2012 | Regular Session | Introduced
Bill Title: Common interest developments: assessments.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2012-02-01 - Died at Desk. [AB466 Detail]
Download: California-2011-AB466-Introduced.html
BILL NUMBER: AB 466 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Butler
FEBRUARY 15, 2011
An act to amend Section 1366 of the Civil Code, relating to common
interest developments.
LEGISLATIVE COUNSEL'S DIGEST
AB 466, as introduced, Butler. Common interest developments:
assessments.
The Davis-Stirling Common Interest Development Act defines and
regulates common interest developments, and authorizes an association
to levy regular and special assessments in accordance with specified
requirements.
This bill would make technical, nonsubstantive changes to these
provisions.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 1366 of the Civil Code is amended to read:
1366. (a) Except as provided in this section, the association
shall levy regular and special assessments sufficient to perform its
obligations under the governing documents and this title. However,
annual increases in regular assessments for any fiscal year, as
authorized by subdivision (b), shall not be imposed unless the board
has complied with subdivision (a) of Section 1365 with respect to
that fiscal year, or has obtained the approval of owners,
constituting a quorum, casting a majority of the votes at a meeting
or election of the association conducted in accordance with Chapter 5
(commencing with Section 7510) of Part 3 of Division 2 of Title 1 of
the Corporations Code and Section 7613 of the Corporations Code. For
the purposes of this section, "quorum" means more than 50 percent of
the owners of an association.
(b) Notwithstanding more restrictive limitations placed on the
board by the governing documents, the board of directors may not
impose a regular assessment that is more than 20 percent greater than
the regular assessment for the association's preceding fiscal year
or impose special assessments which in the aggregate exceed 5 percent
of the budgeted gross expenses of the association for that fiscal
year without the approval of owners, constituting a quorum, casting a
majority of the votes at a meeting or election of the association
conducted in accordance with Chapter 5 (commencing with Section 7510)
of Part 3 of Division 2 of Title 1 of the Corporations Code and
Section 7613 of the Corporations Code. For the
purposes of this section, quorum means more than 50 percent of the
owners of an association. This section does not limit assessment
increases necessary for emergency situations. For purposes of this
section, an emergency situation is any one of the following:
(1) An extraordinary expense required by an order of a court.
(2) An extraordinary expense necessary to repair or maintain the
common interest development or any part of it for which the
association is responsible , where a threat to personal
safety on the property is discovered.
(3) An extraordinary expense necessary to repair or maintain the
common interest development or any part of it for which the
association is responsible that could not have been reasonably
foreseen by the board in preparing and distributing the pro forma
operating budget under Section 1365. However, prior to the imposition
or collection of an assessment under this subdivision, the board
shall pass a resolution containing written findings as to the
necessity of the extraordinary expense involved and why the expense
was not or could not have been reasonably foreseen in the budgeting
process, and the resolution shall be distributed to the members with
the notice of assessment.
(c) Regular assessments imposed or collected to perform the
obligations of an association under the governing documents or this
title shall be exempt from execution by a judgment creditor of the
association only to the extent necessary for the association to
perform essential services, such as paying for utilities and
insurance. In determining the appropriateness of an exemption, a
court shall ensure that only essential services are protected under
this subdivision.
This exemption shall not apply to any consensual pledges, liens,
or encumbrances that have been approved by the owners of an
association, constituting a quorum, casting a majority of the votes
at a meeting or election of the association, or to any state tax
lien, or to any lien for labor or materials supplied to the common
area.
(d) The association shall provide notice by first-class mail to
the owners of the separate interests of any increase in the regular
or special assessments of the association, not less than 30 nor more
than 60 days prior to the increased assessment becoming due.
(e) Regular and special assessments levied pursuant to the
governing documents are delinquent 15 days after they become due,
unless the declaration provides a longer time period, in which case
the longer time period shall apply. If an assessment is delinquent
the association may recover all of the following:
(1) Reasonable costs incurred in collecting the delinquent
assessment, including reasonable attorney's fees.
(2) A late charge not exceeding 10 percent of the delinquent
assessment or ten dollars ($10), whichever is greater, unless the
declaration specifies a late charge in a smaller amount, in which
case any late charge imposed shall not exceed the amount specified in
the declaration.
(3) Interest on all sums imposed in accordance with this section,
including the delinquent assessments, reasonable fees and costs of
collection, and reasonable attorney's fees, at an annual interest
rate not to exceed 12 percent, commencing 30 days after the
assessment becomes due, unless the declaration specifies the recovery
of interest at a rate of a lesser amount, in which case the lesser
rate of interest shall apply.
(f) Associations are hereby exempted from interest-rate
limitations imposed by Article XV of the California Constitution,
subject to the limitations of this section.
