Agenda Summary – Common Interest Development Committee Marriott Hotel Anaheim, California Grand Ballroom, Salon K Thursday, October 11, 2007 9:30 am – 11:30 amPresiding: Steve Delmartini, Chair Rana Linka, Vice Chair Michael Tessaro, Vice Chair Susan Tilling, Committee LiaisonC.A.R. Staff: Dave Milton Natalie CardenasI. Opening CommentsII. Introduction of 2008 Committee LeadershipA. Susan Tilling, Chair B. Gwen Hodge, Vice Chair C. Mile Reilly, Vice Chair D. Malcolm Bennett, Committee LiaisonIII. C.A.R. Basic Guide to Owning a Home in, and Administration of CIDsA. Discussion and Acknowledgement of Final Draft (A PDF Copy of Final Draft can be found athttp://www.car.org/library/media/papers/pdf/CIDBrochure.pdf) B. DisseminationIV. Report from the Working Group (WG) on Occupancy Restrictions inCommon Interest DevelopmentsA. Summary of Working Group Deliberations (See attached Issues Background Paper.)B. Motion for Action by the Committee (Subject to Final Approval of the WG at its October 11 Meeting.):That California Association of REALTORS® sponsor legislation in 2008 providing that the rights of an owner in a common interest development to own, occupy, lease or sell his or her ownership interest shall not be changed throughout the duration of such ownership, and such rights ofa subsequent owner can only be affected by a 2/3 affirmative vote by the members of the association pursuant to a written ballot.V. LegislationA. California Law Revision Commission (CLRC) “Tentative Recommendation for the Statutory Clarification andSimplification of Common Interest Development Law”. C.A.R. submitted comments to the CLRC on September 21. (A PDF copy of C.A.R. comments can be found athttp://www.car.org/library/media/papers/pdf/CIDLawRev.pdf.)B. 2007 Bills of InterestAB 567 (Saldana) Common Interest Development Bureau – As amended on April 10, this bill proposes to create a CID Bureau within the State Department of Consumer Affairs. To be funded by a $5 annual fee on every CID unit in the state, the Bureau would provide three primary services: - Education of homeowners and association officers, through an Internet Website, toll-free telephone call center, and training classes. - Empirical data collection, intended to provide policy makers with reliable information about the nature and incidence of problems occurring within California’s 41,000 common interest developments. - Provide a neutral, non-judicial forum for the resolution of common interest development disputes. The goal would be to informally resolve as many disputes within CIDs as possible, through the Bureau auspices. As a last resort, the Bureau would be authorized to issue a citation for violation of thelaw. The bill is being held in the Assembly Housing & Community Development Committee. C.A.R. Position: Not Rated File. Status: Assembly Housing Committee – Two-year Bill. There will be an “Interim Hearing” on the bill onOctober 30 in the district of the Author, Assembly Housing Committee Chair Lori Saldana (San Diego). C.A.R. will participate in this hearing, intended to generate input on how such a Bureau should be structured. The bill will be set for hearing in the Assembly Housing and Community Development Committee in January, 2008.AB 691 (Silva) Certified Common Interest Development Managers- Sponsored by the California Association of Community Managers (CACM), this bill proposes to extend the sunset date on the heretofore successful voluntary certification program for professional managers. The sunset date is being pushed out to January 1, 2012. This program is currently set to expire January 1, 2008. Additionally, this bill proposes to further the education of CID managers by including “conflict avoidance resolution” courses in the certification training. C.A.R. supports AB 691 because it provides professional enhancement for individuals serving as CID managers and does not burden real estate licensees. C.A.R. Position: Support. Status: Governor’s DeskAB 952 (Mullin) Common Interest Development Assessments – AB 952 prevents a CID from imposing a regular assessment that exceeds 20 percent of the association's preceding year’s budget, or special assessments that exceed 5 percent of the association’s gross expenses, without obtaining the approval of 50 percent plus one of the market-rate unit owners, as well as requiring approval of a majority of the low- or moderate-income unit owners. This voting requirement would give a small minority of owners veto power over the vote of a majority of unit owners. Furthermore, the bill requires the association to establish an optional payment plan for all regular and special assessments imposed on affordable units and may not assess interest or late charges if the assessments are fully paid within 12 months. C.A.R. opposes AB 952 because the proposed voting process could place in block significant maintenance and property improvement actions by a CID Board of Directors and thus negatively impact property values in the impacted CID. C.A.R. Position: Oppose. Status: Senate Inactive File. (Two year bill that the Author may attempt to move in 2008. Also opposed by the Department of Real Estate, California Association of Certified Managers (CACM), Community Associations Institute (CAI), and Executive Council of Homeowners (ECHO)).SB 528 (Aanestad) Common Interest Development Meeting Agenda Requirements- The bill, as enrolled on September 4 following a 36-0 concurrence vote in the Senate, provides as follows: 1) It prohibits a CID board of directors from discussing and taking action on an item in a non-emergency meeting unless the item was placed on the agenda when the meeting was noticed pursuant to current law. 2) It clarifies that the requirement in paragraph 1 does NOT prohibit a resident who is not a member of the board from speaking on issues not on the agenda. 3) It requires meeting notices to include theagenda for the noticed meeting. 4) It provides several exceptions to the requirements in paragraphs 1-3, providing latitude to a CID board of directors regarding responding to, or clarifying, comments made by members, as well as taking emergency actions.
The author introduced this bill to address concerns expressed by CID unit owners in his district that, while current law requires a CID board to provide notice of meetings at least 4 days prior to a regular meeting, the law does notrequire an agenda to be provided with the notice or that the board follow what is on the agenda. As a result, some boards were taking actions without the knowledge or participation of the HOA members. This bill was intended to close this “loophole”. C.A.R. Position: Favor. Status: Governor’s DeskSB 948 (Harman) Education Requirements for Common Interest Development Association Board Members- This legislation is sponsored by the Community Associations Institute (CAI). As amended on May 25, it addressed C.A.R.’s concerns with earlier versions of the bill. The Davis-Stirling Common Interest Development Act provides for the creation and regulation of common interest developments. Existing law requires the Department of Consumer Affairs and the Department of Real Estate to develop an online education course for the board of directors of an association regarding the role, duties, laws, and responsibilities of board members and prospective board members, and the non-judicial foreclosure process. This bill, as amended on May 25th, would, as of January 1, 2009, require every member of the board of directors of a CID association to complete at least one course during the first 12 months of his or her first full term of office, and at least one course every 4 calendar years after becoming a member of the board. Such a course shall cover decisional and statutory law regarding common interest developments, and the cost of such a course cannot exceed $25. SB 948 proposes to require the course to be approved by the Department of Real Estate and establish uniform guidelines for the course. The bill would exempt the developer of a common interest development from this requirement until the board of directors governing that development is formed. It also exempts real estate licensees and attorneys who take such courses during the maintenance of their respective licenses, as well as common interest development managers. C.A.R. Position: Watch Status: Senate InactiveFile. The Author placed this bill on the Inactive File when sponsors and opponents could not reach an agreement on its contents. Efforts to reach a compromise will be re-instigated in January.VI. Other BusinessVII. Adjournment