How to find the law? Federal regulations. Kelly G. Richardson, Esq., CCAL. State: FHA/FNMA/HUD Condominium underwriting guidelines

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1 Kelly G. Richardson, Esq., CCAL Cardinal Property Management Client Education Seminar: Legislative Recap 2011 How does it affect your association? By Kelly G. Richardson, Esq., CCAL January 31, USC Law graduate, 29 years in practice CAI: Board of Trustees, College of Community Association Lawyers, admitted 2006 Orange County Regional Chapter, Board of Directors Past Chair, California Legislative Action Committee, current member Executive Committee Co-author/originator, CAI 3 hour Basic Board Education Course Co-author/originator, CAI California Law Course for Community Managers (8 hours) Co-author,originator, CAI Educated Business Partners curriculum (new in 2012) California Association of Realtors: Licensed Real Estate Broker Member of CAR Housing Committee Member, Legal Affairs Forum Counsel, two Associations of Realtors Author, CAR Owners Guide to the Common Interest Development Community association law since 1989 Past columnist- 12 Newspapers, including LA Daily News, Pasadena Star-News, & Orange County Register on HOAs Represents over 400 Homeowner Associations HOA Homefront on Facebook AV rated by Martindale Hubbell Richardson Harman Ober PC How to find the law? State: Federal regulations FHA/FNMA/HUD Condominium underwriting guidelines Delinquencies (30 days+) no more than 15% of units Maximum 10% ownership by one investor Reserve savings - Minimum 10% of budget Minimum 50% owner-occupied Fidelity insurance Continuing certification

2 AB Tenants SB Tenants Amends Civil Code Section Lengthens the time for a tenant to cancel lease 180 days from issuance of Restraining Order or Police Report Tenant must give 30 day notice Notice can be copy of Restraining Order or Police Report If landlord rents the premises within the 30 days, tenant s rent is adjusted Adds new Civil Code Section Tenants may post political signs In windows, on doors Does not affect CID s, which already have a signage free speech law SB Tenants SB 426 Tenants Adds Civil Code Section Signs must be political, regarding a public vote Signs may be in yard, window, door, window, or balcony.. Or outside wall Signs no larger than six square feet Signs posted no earlier than 90 days before vote and removed no later than 15 days after. Dogfighting Cockfighting SB 426 Adds Civil Code Section Dogfighting and cockfighting ground to cancel tenant s lease 3 day notice Legally a public nuisance SB Tenants Adds Civil Code Section Allows residential landlords to ban smoking in all or part of the rented premises

3 SB 458 Short sales SB 563 Board meeting procedures Short sale agreement eliminates any deficiency liability of mortgage holders Short sale must be consensual Only applies to mortgages, not other liens, such as assessment liens Mortgage holder may not insist on additional payment or waiver as condition of short sale Law effective July 2011 already in effect Background Open Meeting Act (Civil Code ) Action by unanimous written consent gone 2 day notice of meetings which are solely executive session Telephone meeting participation Emergency decisions via All other decisions by expressly banned SB 563 there s more SB 209 Electric Charging Stations Former definition of meeting : majority of the members of the board at the same time and place to hear, discus or deliberate upon any item of business scheduled to be heard by the board NEW definition of meeting : upon any item of business that is within the authority of the board. OR A teleconference with a majority of the board Adds Civil Code Section Homeowners may install electric charging stations Must have insurance, other requirements May be in exclusive use or in general common area Law might be amended further in SB 150 Rental restricitons SB 771 Document fees Adds Civil Code Section Limits ability of HOAs to restrict rentals Any amendment after 1/1/12 will only apply to FUTURE homeowners Landlords must inform HOA of tenant in unit (conflict with FHA/FNMA requirement?) Amends Civil Code Section 1368, adds Civil Code Section Document fees by managers of HOA must be reasonable Disclosure of fees

4 SB 221 Small Claims Court SB 183 (2010) Carbon Monoxide Amends Code of Civil Procedure Section Small claims court limit raised to $10,000 for natural persons A CID is not a natural person Requires installation of carbon monoxide ( co ) detectors in all single family detached homes by JULY 1, All other housing (including apartments and attached housing) must have CO detectors installed by January 1, 2013 Law provides for a fine, after a warning Disclosure item NOW? AB 341 Recycling services Pasadena anti-smoking ordinance Multi-unit residential complexes of 5 or more units must have recycling services in place by July 1, Limited exemptions No recycling service available Undue burdens to create recycling bin location Adds Section to PMC Bans smoking effective January 1, 2013, in all multi-unit housing. Requires lease agreements AND sales agreements contain disclosure of ordinance AND include a copy to tenant/buyer Multi-unit buildings must post signs by 1/1/12 Enforced by City Health Department Legislative outlook 2012 Legislative outlook long term Assessment collections on foreclosed properties Garnishment of rents Election reform? California Law Revision Commission AB 805, 806 Stated intention: No substantive changes Actual impact: over 25 substantive changes from current law Effective date: January 1,

5 Thanks for coming Questions (time permitting) Richardson Harman Ober PC 5