BIG CHANGES TO
In an effort to create more affordable housing, the California Legislature enacted Senate Bill 1079 which modifies procedures for the sale of residential property through nonjudicial foreclosure.
The goal is to assist eligible bidders in finding affordable housing and stem the flow of foreclosures snapped up by lenders and real estate investors.
Sales Are not Final. Effective January 1, 2021, eligible bidders will be able to bid on foreclosed residential properties after the foreclosure sale has taken place. This is a major change in foreclosure sale procedure. For the past almost 100 years, foreclosure sales have been final when the auctioneer states “sold” at a public auction (subject to the right of redemption).
Eligible Bidders Defined. An “eligible bidder” will be defined as (1) a qualifying tenant who is already occupying the foreclosed property, (2) a person who is willing to move into the property for at least one year, and (3) certain nonprofit housing agencies. These eligible bidders can take ownership of the foreclosed properties away from successful bidders at foreclosure sales.
Procedure. Eligible bidders will have 15 days after the sale to give notice to the foreclosure trustee of their intent to bid on the property, and 45 days from the sale date to tender payment. After-sale tenant buyers only have to match the highest bid at the foreclosure sale, while owner-occupants and nonprofits will have to exceed the successful bid. Responsibility for administering post-sale procedures will fall to foreclosure trustees who handle the original sales.
Thank you to Richard Witkin for this article. Richard is the premier assessment collection attorney in California, with extensive knowledge of assessment lien and foreclosure matters.
COLLEGE OF COMMUNITY
We are pleased to announce that Partner Laurie Poole has been named President-Elect of CAI’s College of Community Association Lawyers (CCAL) for 2021.
CCAL is the most prestigious designation for attorneys in the community association industry. The College puts on an annual nationwide law seminar providing continuing education for attorneys specializing in community association law.
The College works to advance the law for the betterment of community associations. It reports on key court decisions throughout the United States and files amicus briefs on cases important to community associations.
Balanced Budget. Regarding balanced budgets, what about Civil Code 5600? In my opinion, the legislature wants associations to have enough money to pay all their bills, but no more than that. –Scott C.
RESPONSE: You are quite right, I completely forgot about Civil Code 5600(b): "An association shall not impose or collect an assessment or fee that exceeds the amount necessary to defray the costs for which it is levied." That means boards need to prepare balanced budgets. I added it to our page on Preparing Annual Budgets.
Rent Restrictions #1. I would appreciate a more thorough explanation of how the new rent restrictions are applied. For example, in a 100-home HOA with 10 currently rented and with a 10% cap on rentals, do the preexisting 10 rentals get counted towards the new cap of 25 or are they added on top so it's 35 rentals? –Bill B.
RESPONSE: The existing 10 rentals count toward the 25% cap, not on top. Once you have 25 rentals, you hit the cap. However, if you don't conform your governing documents to the 25% cap, your 10% becomes unenforceable on January 1, 2021, which means all 100 units could potentially become rentals.
Rent Restrictions #2. Regarding AB 3182, does it only apply to housing, condo, townhouse etc? We are an RV resort where owners purchase a lot for their recreational vehicle. We are seeing an increase of investors purchasing multiple lots for rental purposes only. –John R.
RESPONSE: It applies to all residential common interest developments--condominiums, planned developments, stock cooperatives and community apartment projects. If an RV resort or mobile home park or stock co-op falls under the Davis-Stirling Act, AB 3182 applies. Our short-sighted legislators in Sacramento think that turning homeowner communities into investor-owned rentals is somehow good for housing.
Balcony Inspections #1. Now that balcony inspections are required, where do we find a company that is qualified to do these inspections? What are their qualifications? Are they required to be certified in “balcony inspections?” -Jim M.
RESPONSE: I'm not aware of a certification for balcony inspections. The statute calls for inspections by a licensed architect or structural engineer. (Civil Code §5551(b)(1).) I know of two companies currently providing balcony inspection and repair services: The Bergeman Group and AWS Consultants. If readers are aware of others, let me know.
Balcony Inspections #2. Is the presentation on SB 326 open to anyone who wants to attend? -M.W.
RESPONSE: The event is put on by HOA Organizers and is open to any board member and homeowner who wants to attend. The virtual event features speakers on topics such as changes in the law, balcony inspections, insurance basics, waterproofing, environmentally friendly landscaping, and more. For information about the event, go to ABCs of HOAs. Those who wish to attend can register here.
Nevada Office. We do a lot of work in Nevada and you are sorely needed. As you know, there are excellent attorneys in NV but there isn’t a cohesive messaging strategy for CID issues such as your newsletter. I am on a NV Task Force, "Reserves for the Recovery," helping the state deal with the flood of calls they are receiving about reserve issues, such as borrowing, missing deposits, etc. -Bob B.
RESPONSE: Reserves are essential for associations. I’ve seen too many situations where associations were faced with large special assessments to address significant deferred maintenance with no reserves in place. New owners saddled with the assessment were angry and dismayed. The recently passed balcony inspection law in California will help associations address this oft-overlooked expense. Nevada should consider something similar.
NEWSLETTERS. Readers can find current year and prior year newsletters posted here. Older newsletters are not posted since the information they contain can change over time with new statutes and case law. The website itself is kept updated with current information which can be found via the "Index" or through our website's "Google Search."
Statewide Update. Governor Newsom moved the State back to a partial lockdown by moving 28 Counties to the most restrictive Purple Tier, nine Counties to Red Tier and two Counties back to Orange Tier. He also issued November 13, 2020 Travel Advisories urging against non-essential out-of-state travel and asking people to self-quarantine for 14 days after arriving from another state or country. Governor Newsom issued a limited stay-at-home order for Purple Tier Counties for non-essential activities, including mixed household gatherings between 10:00 p.m. and 5:00 a.m., starting 11/21. Order is set to expire 12/21.
There are new requirements for face coverings at all times outside the home, with some exceptions (Facial Covering Guidance).
The following Counties have updated Tiers: Alameda (Orange to Purple); Butte (Orange to Purple); Calaveras (Yellow to Orange); Colusa (Orange to Red); Contra Costa (Red to Purple); Del Norte (Orange to Red); El Dorado (Red to Purple); Fresno (Red to Purple); Glenn (Red to Purple); Humboldt (Yellow to Red); Kern (Red to Purple); Kings (Red to Purple); Marin (Orange to Red); Mendocino (Red to Purple); Merced (Red to Purple); Modoc (Orange to Red); Mono (Orange to Red); Napa (Orange to Purple); Nevada (Orange to Purple); Placer (Red to Purple); Plumas (Orange to Red); San Benito (Red to Purple); San Francisco (Yellow to Red); San Joaquin (Red to Purple); San Mateo (Orange to Red); Santa Clara (Orange to Purple); Santa Cruz (Red to Purple); Sierra (Yellow to Orange); Siskiyou (Orange to Purple); Solano (Red to Purple); Sutter (Red to Purple); Trinity (Orange to Purple); Tuolumne (Orange to Purple); Yolo (Red to Purple); Yuba (Red to Purple).
NorCal Counties. Alameda County moved from the Orange Tier to the Purple Tier and issued a November 16, 2020 Press Release regarding the same and indicating some of the changes this will entail. The County linked to the following updates.
Butte County moved from the Orange Tier to the Purple Tier and will require changes in business opening and operations accordingly.
Calaveras County moved from the Yellow Tier to the Orange Tier and will require changes in business opening and operations accordingly.
Contra Costa County moved from Red Tier to Purple Tier and issued a November 16, 2020 Press Release regarding this change and updated their “Openings at a Glance”.
El Dorado County moved from the Red Tier to the Purple Tier and will require changes in business opening and operations accordingly.
Fresno County moved from the Red Tier to the Purple Tier. The County provided the updated facial covering guidance from the State. The County issued updated Youth & School-Based Sports Guidance.
Lake County indicated that they are officially in the Red Tier and will require changes in business opening and operations accordingly.
Marin County moved from the Orange Tier to the Red Tier and issued a November 16, 2020 Press Release regarding this change and necessary changes in business openings and operations.
Mendocino County moved from Red Tier to Purple Tier and updated their Health Order to comply with the changes. The County also issued updated guidance for outdoor gatherings.
Mono County moved from Orange Tier to Red Tier and issued a November 16, 2020 Press Release. Mono County issued Holiday Guidance. The Town of Mammoth Lakes issued a Revised Short-Term Lodging Order.
Monterey County published the CDPH’s new facial covering guidance.
Napa County moved from the Orange Tier to Purple and the County updated the Business Operations FAQs.
Nevada County moved from the Orange Tier to the Purple Tier and issued a November 16, 2020 Press Release.
Placer County moved from the Red Tier to the Purple Tier and will require changes in business opening and operations accordingly.
Sacramento County published Guidance on Safely Celebrating During COVID-19.
San Francisco moved from the Yellow Tier to the Red Tier. The County issued a November 16, 2020 Press Release related to the changes.
San Joaquin County moved from the Red Tier to the Purple Tier and issued a November 16, 2020 Press Release regarding this move.
San Mateo County moved from the Orange Tier to the Red Tier and issued a November 16, 2020 Press Release regarding this move.
Santa Clara moved from the Orange Tier to the Purple Tier. The County updated their Order and issued a Mandatory Directive on Capacity Limitations.
Santa Cruz County moved from the Red Tier to the Purple Tier and issued a November 16, 2020 Press Release regarding the move.
Solano County moved from the Red Tier to the Purple Tier and issued a November 16, 2020 Press Release regarding the move.
Stanislaus County issued a November 16, 2020 Press Release regarding the County’s move to the Purple Tier.
Sutter County moved from the Red Tier to the Purple Tier and will require changes in business opening and operations accordingly. They also published the State’s facial covering guidance.
Tehama County issued Guidance for Gatherings and Travel.
Tuolumne County moved from the Orange Tier to the Purple Tier and will require changes in business opening and operations accordingly.
Yolo County moved from the Red Tier to the Purple Tier and issued a November 16, 2020 Press Release regarding the move. Yolo County issued a November 19, 2020 Health Advisory regarding quarantine after travel.
Yuba County moved from the Red Tier to the Purple Tier and will require changes in business opening and operations accordingly.
SoCal Counties. Imperial County issued a limited stay at home order to abide by the state’s guidelines, with no more than sixteen (16) individuals able to attend any private gathering. Further, singing, chanting, shouting and playing of wind instruments are prohibited during any private gathering.
Los Angeles County established a curfew for restaurants, breweries, wineries and bars, and all other non-essential retail establishments must close between 10:00 p.m. and 6:00 a.m. Non-essential businesses permitted to operate indoors at 25% capacity (retail stores, offices, personal care services), outdoor gatherings are only gatherings permitted, limited to three households and maximum 15 people.
Orange County fell back to Purple Tier.
Riverside County issued Thanksgiving guidelines to keep holiday gatherings “smaller, shorter, safer.”
San Diego County changed its health order to comply with restrictions in Purple Tier. All customers of indoor hair salons and personal care services must sign in with name and telephone number.
Santa Barbara County continued its face covering order until December 14, 2020, and further, issued an amended health order to align with Purple Tier status.
San Luis Obispo County released Thanksgiving guidelines and fell back to Purple Tier.
READING THE CHART. Because the chart is large and the text small, you can easily make it larger for viewing by holding down the "Ctrl" key on the left side of your keyboard and then using your finger to scroll forward or backwards with the wheel on your mouse. You will see the text grow larger or smaller as you move the wheel. For a list of County restrictions and links to health department orders, see County Chart 11-20-20. The chart is also posted on our website.
|DISCLAIMER. Our newsletter provides commentary based on sketchy information we receive from readers. From time to time, we add a little humor. Some find it amusing. Others are appalled. Some readers are excited when they score free legal advice. Not so. Our newsletter provides commentary only, not legal advice. You need to pay real money for an attorney to review all the facts and give you a legal opinion. We do that too, but you have to hire us. It's okay, we're friendly. Keep in mind we are corporate counsel to California associations only. Ask us for a proposal to represent your association.