BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 968
                                                                  Page  1

          CONCURRENCE IN SENATE AMENDMENTS
          AB 968 (Gordon)
          As Amended  August 22, 2014
          Majority vote
           
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          |ASSEMBLY:  |     |(May 9, 2013)   |SENATE: |30-5 |(August 27,    |
          |           |     |                |        |     |2014)          |
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                          (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  



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