Boards may not impose assessments or fees that exceed the amount necessary to defray the costs for which it is levied. Civ. Code §1366.1. At times, establishing fees are imprecise and the Davis-Stirling Act provides no clear guidance as to how homeowners associations must go about correlating fees and costs. The fees charged by associations must be reasonable.

Burden of Proof. If challenged, the burden is on the plaintiff to prove that the challenged fees violate state law. (Dey v. Continental Cent. Credit (2008) 170 Cal.App.4th 721, 727, citing Berryman v. Merit Management (2007) 152 Cal.App.4th 1544, 1560 ("It is [plaintiff's] burden to demonstrate why the collection fee is illegal, rather than defendant's burden to justify that it is legal for it to charge a fee for [the] service.")

Reserve Assessment. A special assessment to fund the reserve account does not fall under the fee limitations described above.

Exceptions. Management companies and Community Service Organizations are exempt from fee limitations.