State lawmakers are being urged to scale back the number of laws they propose; they should start with those that impact California condominium and homeowner associations

By David C. Swedelson, SwedelsonGottlieb Partner

There was an interesting article on new legislation in the March 6, 2011 edition of the Los Angeles Times about the 2,323 new bills that have been introduced in the California legislature, and this includes several that impact California community associations (more on that below). As reported in the Times:

In addition to addressing the state’s $25-billion deficit this year, the Legislature is making time for some other less-pressing matters: Caffeinated beer. Spaceships. How to properly describe a dog pound.

Proposals on those subjects are among the 2,323 bills lawmakers have introduced this year. Others would revise the definition of olive oil and regulate the reflectivity of pavement to help curb global warming. There’s a measure to create a “Parks Make Life Better” month.

“Spay Day”, a bid to encourage the spaying and neutering of pets, has already received two legislative analyses and one committee vote (it passed). And there’s a bill to provide new tax credits for commercial space vehicles being developed in the Mojave Desert.

The number of measures lawmakers are considering is slightly less than average. In fact, the volume has been dropping since a cap was applied in the early 1990s. But Gov. Brown, good-government activists and even some legislators say there are still too many, especially as California mulls deep cuts in services and possibly more taxes in its effort to balance the budget.

Like his predecessor, Brown has asked the Legislature to rein in its zeal for new laws. “I definitely think there are too many laws, just as there are probably too many regulations,” Brown said, “We have chosen over our whole history to increasingly resort to laws, to lawyers and to courts – and it’s a heavy burden.”

One lawmaker has introduced a bill calling for fewer bills. Assemblyman Brian Nestande (R-Palm Desert) wants to restrict each Assembly member to 30 bills -10 fewer than now allowed. That could shelve as many as 800 bills a session. “I’m sure each bill is important to each author,” Nestande said, “but when you add it up, it’s just too much…. It almost seems like some people are straining to have a bill.”

Certainly, California’s lawmakers have produced pioneering legislation, including a landmark global warming law and the nation’s first health insurance exchange. This year, they have proposed expanding renewable energy, streamlining business regulations and tackling government corruption. More than a dozen bills address issues raised by allegations of financial improprieties in the cities of Bell and Vernon.

But too many proposals are simply self-serving, said some observers. A bill can help a lawmaker make a name for himself or herself – and raise campaign cash – in a large institution where most key decisions are made by a handful of power players. And term limits create a sense of urgency.

“These legislators show up, they’re not here for long and they want to do everything they ever thought of,” said Rob Stutzman, a Republican consultant in Sacramento.

I have a different take on this. If a constituent complains about how their community association is operated, their legislator may attempt to totally revamp how elections and secret balloting are conducted, or require that associations only deal with the business listed on their agenda, even if an important new issue arises (those who manage or sit on the board of a California community association likely know what I am talking about).

So what are some California legislators cooking up for California community associations this term? There are bills proposed that will limit the amount that can be charged for document production fees by third parties (to legislatively address the Court of Appeal decisions in Brown and Berryman), impact how associations offer delinquent assessment payment plans/agreements, require installation of electrical outlets for vehicles, bar board actions between meetings, and revamp the entire Davis-Stirling Act.

AB 771 would cap the fee (and profit) charged by private companies for gathering and delivering CC&Rs and financial statements to sellers at time of sale. This will then require that all of the other owners pay for the services of those service providers that charge for performing this service. Someone has to pay and the services are required.

SB 209 would prohibit California community associations from restricting an owner’s installation of an electric vehicle charging station anywhere in the development. Associations that violate this proposed new law would be liable for damages and a civil penalty of $1,000 per occurrence. The bill fails to address who pays for installing and mantaining these charging stations, who is liable for injury or damage from installation and use of the outlets, and who pays the cost of the electricity.

SB 561 would require any paid assessments from a delinquent owner to first be applied to the assessments owed and not the collection fees or costs. This would allow a delinquent owner to pay the assessments and leave the association and the other members responsible for paying the collection and attorneys’ fees and related costs. Associations may be forced to pay the collection companies’ fees up front with no guarantee that they will be repaid by the debtor/ owner.

SB 563 would prohibit association boards from discussing and taking action on any item outside of a properly noticed meeting and not via email. A room is to be available for members to participate in the teleconferences. This would negatively impact an association’s ability to make important decisions that cannot wait for the next board meeting.

We at HOALawBlog will be carefully monitoring this proposed legislation and updating you on what is happening in Sacramento. We may call on you to write letters and emails to your legislators letting them know just how you feel about these bills. Stay tuned.

Questions/comments? Contact David Swedelson:

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