BILL ANALYSIS Ó AB 968 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 968 (Gordon) As Amended August 22, 2014 Majority vote ----------------------------------------------------------------- |ASSEMBLY: | |(May 9, 2013) |SENATE: |30-5 |(August 27, | | | | | | |2014) | ----------------------------------------------------------------- (vote not relevant) Original Committee Reference: H. & C.D. SUMMARY : Clarifies the homeowners association (HOA) and the owner's responsibility for repairing, maintaining, and replacing the common area, a separate interest, and the exclusive use common area appurtenant to a separate interest. The Senate amendments delete the Assembly version of this bill, and instead: 1)Clarify that except where otherwise provided in the governing documents of a common interest development (CID), the following are true: a) An HOA is responsible for repairing, replacing, and maintaining the common area of the CID. b) The owner of a separate interest in a CID is responsible for repairing, replacing, and maintaining that separate interest. c) The each owner of a separate interest is responsible for maintain the exclusive use common area appurtenant to the separate interest. d) The HOA is responsible for repairing and replacing the exclusive use common area. 1)Take effect on January 1, 2017. FISCAL EFFECT : None COMMENTS : There are over 49,000 CIDs in the state that range in size from three to 27,000 units. CIDs make up over 4.9 million AB 968 Page 2 housing units which represents approximately one quarter of the state's housing stock. CIDs include condominiums, community apartment projects, housing cooperatives, and planned unit developments. They are characterized by a separate ownership of dwelling space coupled with an undivided interest in a common property, covenants and conditions that limit the use of common area, separate ownership interests, the management of common property, and enforcement of restrictions by a HOA. CIDs are governed by the Davis-Stirling Act as well as the governing documents of the HOA including bylaws, declaration, and operating rules. Under existing law an HOA is responsible for repairing, replacing, and maintaining the common area of a CID. An owner is responsible for maintaining their separate interest and any exclusive use common area attached to the separate interest. To some extent, it is unclear whether the HOA or the owner is responsible for replacing and repairing the exclusive use common area. This bill would make it the HOA's responsibility to repair and replace the exclusive use common area. This bill goes into effect on January 1, 2017. This bill was substantially amended in the Senate and the Assembly-approved version of this bill was deleted. This bill, as amended in the Senate, is inconsistent with Assembly actions and the provisions of this bill, as amended in the Senate, have not been heard in an Assembly policy committee. Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085 FN: 0005213