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pesticides_-_Google_Search-300x268From the Community Association Attorneys at SwedelsonGottlieb

When community associations decide to have chemical pesticides or weed-killing herbicides such as Roundup applied, they must provide detailed, written advance notice to homeowners and residents.

Pursuant to Civil Code §4777(b), “an association or its authorized agent that applies any pesticide to a separate interest or to the common area without a licensed pest control operator shall provide the owner and, if applicable, the tenant of an affected separate interest and, if making broadcast applications, or using total release foggers or aerosol sprays, the owner and, if applicable, the tenant in an adjacent separate interest that could reasonably be impacted by the pesticide use with written notice…”

Screenshot_5_28_20__3_30_PM-300x187 The COVID-19 pandemic resulted in the closures of community association pools, spas, tennis courts, gyms and other recreational facilties. The good news is that the State of California and the 58 counties are in the process of issuing new orders regarding the use of community association pools, tennis courts and other recreational facilities. The attorneys at SwedelsonGottlieb have researched all 58 counties and follow this link to our listing of same and their current orders regarding pools tennis courts and other facilities. Changes to the orders and guidance cited to in our listing occur frequently and this list is as of May 27, 2020. And as the different counties are progressing through the phased reopening plans at different paces, each association should check regularly with the State, County, and City for the most up-to-date orders and guidelines.

Contact SwedelsonGottlieb for questions: 800/372-2207 or info@sghoalaw.com

weird_swimming_pools_-_Google_Search-300x147From the attorneys at SwedelsonGottlieb, Community Association Attorneys

At the same time as the State announced that California has become the fourth state in the country to surpass 100,000 coronavirus infections and that 100,000 people have died in the United States from COVID-19, Los Angeles County issued a new order allowing for community association pools to reopen so long as certain protocols are followed. The new LA County Order does not mandate that associations open their pool(s). The association’s owners and residents will likely make a demand on the board to reopen the pool; what’s a board to do?

The first thing is to acknowledge that compliance with the new Order will not be easy. Some associations may opt not to open or not open until the association is able to administer the required protocols. These protocols are important. Let us not forget that LA County is still considered a coronavirus “hotspot” and that means that we must all do our part to stop the spread of the coronavirus. The news is filled with stories of people in California crowding certain recreation areas, pools, restaurants and beaches and not wearing masks and how these conditions have led to outbreaks in other states. Community association boards that decide to open pools, must follow the mandatory LA County protocols. In addition, they must make sure that residents comply.

Follow this link to read the new Order/protocol that the County issued for opening the pool(s). This protocol must be adhered to at all times and provides specific guidance/restrictions/limitations on reopening and use of the pools, including the deck area.

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CAI_LOGO_225Earlier this month, CAI released a Statement of Moratorium on Foreclosure Actions urging community associations to immediately suspend all foreclosure activity and not begin new foreclosure actions until June 1. We question how well thought out this position is as it is not all that realistic for California community associations.

Do not get this wrong. We at SwedelsonGottlieb are well aware of the impact that COVID-19 has had on our world and the fact that over 10,000,000 people filed for unemployment nationwide (so far). We recognize that community association boards are going to need to be sensitive to the fact that many owners may be temporarily (hopefully) unemployed and not able to timely pay their assessments.

As CAI said in its introduction to the Statement of Moratorium, the collection of community association assessments is a very serious and important responsibility of a governing board. Failing to collect assessments may impair a community association’s ability to pays its bills, provide essential services, acquire financing for continued operations, and may impact the ability of a potential purchaser to obtain a mortgage or impact existing owners refinancing of their loans.

Screenshot_4_21_20__10_26_AM-300x110Prepared by the California Community Association Attorneys at SwedelsonGottlieb

By now, most people have heard about the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act (2020 H.R. 748). The breadth and scope of this Act, and the speed at which it passed both houses of a divided Congress and became law, is truly remarkable in these partisan times and speaks to the gravity of the COVID-19 crisis.

The Act is a massive stimulus bill that contains a variety of different programs of grants, loans, credits, debt forgiveness, and tax changes. Each of these programs is administered differently and has different criteria for eligibility.

Two of the Act’s provisions have become of particular interest to community associations: the federal Small Business Administration’s (SBA) new Emergency Economic Injury Disaster Loan Advance Grant program (the EIDL Loans which are available to HOAs), and the Paycheck Protection Program (the PPP which is not currently available to HOAs).

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COVID-19__Force_Majeure_Event____Shearman___Sterling-300x131The spread of the coronavirus/COVID-19 has caused and will likely continue to cause unexpected interruption in the business of many California community associations. Many of our association clients are in the middle of large common area refurbishment and restoration projects. With increasing restrictions and/or recommendations by public officials and others intended to control the spread of the coronavirus, contractors/vendors may suspend or cease services/work and advance “force majeure” as a defense to the association’s breach of contract claim. It is important that board members and managers understand what force majeure means and how to respond when a contractor/vendor suspends or seeks to suspend their performance due to the coronavirus citing a force majeure clause contained in the contract between the association and the contractor or vendor. Follow this link to read SwedelsonGottlieb’s article that explains exactly what force majeure means and how it could impact your community association. And if you have Force Majeure issues or questions, contact SwedelsonGottlieb via email (info@sghoalaw.com) or call us: 800/372-2207

Screenshot_4_7_20__12_32_PM-1-300x116Recently, an attorney that also represents California community associations sent out a newsletter that dealt with assessment collection during the pandemic. We already addressed this issue in our COVID-19 HOA Guidebook. We certainly do not agree with a lot of what that other attorney had to say on this issue and we know that most other community association attorneys that we have spoken with feel the same way. And we preface our comments by saying that we are certainly sympathetic to all those association owners who have been laid off or furloughed as a result of the COVID-19 pandemic. But we are also pragmatic and realistic about how the non-payment of assessments will negatively impact the hundreds of California community associations we represent.

The newsletter from the other attorney suggested that when addressing unpaid assessments as a result of the pandemic (which may not be that easy for boards to determine), association boards need to balance board duties. That newsletter correctly stated that boards have a fiduciary duty to keep their associations’ operational, meaning that they have to pay the utility bills, pay for insurance, for maintenance of the common area, the cost of dealing emergencies, pay vendors, etc. Our colleague suggested that boards need to balance these obligations against the fact that increasing numbers of members cannot pay their assessments because of the pandemic. The newsletter, however, offered no suggestions on how to do this as there is no way to effectively balance the obligations as associations need the money assessed to pay the association’s bills. Yes, boards can delay any discretionary projects, but most associations do not have significant discretionary projects.

As stated in the introduction, don’t misunderstand our pragmatic approach as suggesting that we are not sympathetic to those owners that have lost their jobs and cannot afford to pay their assessments; of course we are sympathetic. That said, those owners will need to find a way to pay their assessments or at the very least contact their associations to request a payment plan so that their associations can manage their expectation of payments and can continue to operate and meet its obligations.

Screenshot_4_2_20__4_11_PM-300x170The COVID-19 pandemic has disrupted the community association industry both in terms of operations and morale. Community association members, board members, and community managers are presumably staying home to avoid contracting the coronavirus, and are not meeting in person. This seems to have led to a reluctance, by some association boards, to conduct business. Further, the social distancing requirements imposed by our State and local governments are eliminating social interaction that is critical to the functioning of the community.  Along with this, the fear and uncertainty of the COVID-19 pandemic has altered the mood and attitude of board members and professionals involved with operating the community association.

The disruption has become apparent and severe. However, we must examine the “silver linings” and “play with the cards we have been dealt” – so to speak – in order to preserve the integrity of our communities and functioning of same. The business that needed to be done before we all retreated to our homes to be safe still needs to get done and the longer boards wait to do that business, the more likely it is that there will be complications. Below are a few ideas that board members should consider moving forward in the face of this pandemic that may last for months.

1. Meetings.  While in-person meetings should be avoided, associations may still be able to conduct meetings via conference call and/or videoconference (e.g., Zoom). The Davis-Stirling Act sets out a procedure for telephone conference meetings, but the Code requires that someone be at a physical location where the owners can listen to the call via speakerphone and participate during open forum. We believe that the ongoing pandemic would warrant a substantial compliance approach. That is, associations can conduct the meeting via telephone or video conference and attempt to comply with the applicable statutes, as much as possible, while at the same time complying with the State and City social distancing orders now in effect. This way, associations may still conduct business and hold meetings so that the common area components continue to be maintained, insurance policies do not lapse, and other obligations like enforcement of the Governing Documents are met.  In other words, California community associations can still function while the board members and management are at the same time complying with government mandated social distancing requirements.

CoronavirusIt is not a hoax; it is a pandemic. And as a result, we are receiving inquiries from board members and managers concerning what community associations should be doing to address the coronavirus (COVID-19) pandemic and the impact of same on their communities. To address these questions, SwedelsonGottlieb published a guidebook that explains, among other things, why we do not believe that community associations have any direct responsibility to deal with the coronavirus; rather it is each residents responsibility to take steps to limit their exposure to the virus to avoid contracting the virus. That said, there are some commonsense things that should be kept in mind. And there are employees and staff to consider. Follow this link&amp to read and download SwedelsonGottlieb’s Guidebook. And note that as the information that we are all receiving about the coronavirus and how governmental agencies are dealing with the disease keeps evolving, so will our advice. So be sure to visit HOAlawblog for the latest coronavirus information and advice as it relates to California community associations.

From the Community Association Attorneys at SwedelsonGottlieb

Is_It_Finally_Time_To_Buy_A_Condo_-300x174The U.S. Department of Housing and Urban Development (HUD) has finally published the long-awaited final revisions to the Federal Housing Administration’s (FHA) condominium project approval rules. The FHA does not originate loans for purchasing condos, but rather insures these loans for borrowers who might not otherwise qualify for traditional financing requiring a 20% down payment. In practice, these changes will give more people access to FHA-insured financing, which should in turn provide many Californians with a better chance of purchasing a condo. The new rules go into effect on October 14, 2019.

Some of the most significant changes in the FHA regulations include:

• The FHA is once again authorized to approve and insure up to 10% of individual loans in a condo project (formerly called “spot,” and now called “single-unit” approval), as long as the condo association as a whole is financially stable.  The FHA may also insure these loans if the condo project itself has not obtained FHA approval, which can be an expensive and cumbersome process for many condo associations.

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