BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 2104
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          ASSEMBLY THIRD READING
          AB 2104 (Gonzalez)
          As Amended  April 1, 2014
          Majority vote 

           HOUSING             7-0                                         
           
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          |Ayes:|Chau, Beth Gaines,        |     |                          |
          |     |Atkins, Brown,            |     |                          |
          |     |Maienschein, Quirk-Silva, |     |                          |
          |     |Yamada                    |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :  Specifies that architectural or landscaping guidelines  
          or policies of a common interest development (CID) are void if  
          they prohibit the use of low water-using plants and other water  
          conservation measures.  Specifically,  this bill  :  

          1)Specifies that architectural or landscaping guidelines or  
            policies are void and unenforceable if they:

             a)   Prohibit the use of low water-using plants as a group or  
               the replacement of existing turf;  

             b)   Restrict compliance with a water-efficient landscape  
               ordinance adopted by a local government; or

             c)   Prevent a homeowner from complying with a water-saving  
               ordinance adopted by a local agency.

           EXISTING LAW  :

          1)Defines the governing documents to mean the declaration, any  
            other documents such as the bylaws, operating rules of the  
            association, articles of incorporation, or articles of  
            association, which govern the operation of the CID or  
            homeowners association (HOA).  (Civil Code Section 4150) 

          2)Makes the governing documents of a CID void and unenforceable  
            if they do any of the following:

             a)   Prohibit or include conditions that have the effect of  








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               prohibiting low water-using plants as a group;

             b)   Restrict compliance with a water-efficient landscape  
               ordinance adopted by a local government; or

             c)   Prohibit compliance with any regulation or restriction  
               on the use of water due to severe water shortage.  (Civil  
               Code Section 4735) 

           FISCAL EFFECT  :  None 
           



          COMMENTS  :  

           Background  :  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 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 an HOA.   
          CIDs are governed by the Davis Stirling Act as well as the  
          governing documents of the HOA including bylaws, declaration,  
          and operating rules.  Existing law provides protections to  
          homeowners who wish to install landscaping that includes low  
          water-using plants. 

          Under existing law the governing documents of a CID cannot  
          prohibit a homeowner from installing low water-using plants as a  
          group.  In addition, CIDs cannot prevent a homeowner from  
          installing landscaping that complies with a city's or county's  
          water-efficient landscape ordinance or from complying with any  
          restrictions on watering that a city or county adopts in  
          response to severe water shortages. 

          The board of directors and homeowners of an HOA rely upon the  
          governing documents which provide the rules and regulations for  
          governing the HOA.  State statute defines the governing  
          documents to include the articles of incorporation and  








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          declaration as well as the operating rules.  The operating rules  
          should include guidance to homeowners on which low water-using  
          plants they can use to replace existing turf and, by state law,  
          cannot prohibit a homeowner from installing low water-using  
          plants.  State statute specifies that an HOA can apply  
          landscaping rules established in the governing documents to the  
          extent that the rules do not prohibit a homeowner from  
          installing low water-using plants or complying with local  
          water-saving ordinances.  

          To the extent this is unclear or that the operating rules have  
          not been updated to reflect state law, this bill would clarify  
          that any architectural guidelines or policies cannot prohibit a  
          homeowner from installing low water-using plants, installing a  
          water-efficient landscape that meets a local ordinance, or  
          complying with water conservation policies adopted by a local  
          government agency.  

           Drought emergency  :  In the beginning of this year, due to record  
          low rainfall, the governor declared a drought emergency. The  
          governor's declaration called on residents to voluntarily reduce  
          water consumption by 20%.  When state law was added to clarify  
          that an HOA's governing documents cannot prohibit a homeowner  
          from installing low water-using plants or complying with local  
          water saving ordinances, California was also suffering from a  
          drought. The Assembly Water Parks and Wildlife Committee  
          analysis from AB 1061 (Lieu), Chapter 501, Statutes of 2001,  
          states:    

               California currently suffers from a drought, and many  
               water agencies are considering mandatory water  
               rationing as early as this summer.  In both the short  
               term and long term, Californians will need to conserve  
               water to maintain water supply reliability for a  
               growing population and a fluctuating or diminishing  
               water supply.  Because landscaping can reflect about  
               half of a resident's water use, water-efficient  
               landscaping is critical to long-term water supply  
               reliability.  According to 2007 California Community  
               Association Statistics, approximately 11 million - or  
               about 1/3 of - Californians live in CIDs.  They  
               therefore account for a significant portion of the  
               landscaping in California.









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           The purpose of this bill  :  According to the author,  
          "notwithstanding the clear intent of the law to promote water  
          conservation some HOAs have skirted these rules by: a) adopting  
          less formal policies that have the same effect as the prohibited  
          policies, e.g. requiring homeowners to keep existing  
          water-intensive lawns or keep a certain percentage of their  
          property covered by lawn; and/or b) denying individual  
          homeowners' requests for approval to install drought-tolerant  
          plants on their properties or to replace existing  
          water-intensive lawns with drought-tolerant plants on the  
          grounds that it would not be consistent with the character of  
          the neighborhood.  These actions are allegedly justified because  
          they are not part of the 'governing documents' of the CID. 

          "AB 2104 would reinforce the intent of existing law by making  
          clear that HOAs cannot use the artifice of placing prohibitions  
          against or restrictions on the use of drought-tolerant  
          landscaping in guidelines, policies, or ad hoc decisions by the  
          board of directors, instead of the governing documents of the  
          CID per se. It is intended to state clearly the Legislature's  
          intent that the replacement of water-intensive lawns with  
          aesthetic drought-tolerant landscaping by environmentally  
          conscious homeowners is to be permitted, not thwarted by an  
          interpretation of the law that is intentionally too narrow.   
          This reinforcement of the law is particularly timely given the  
          current drought emergency, and especially in light of recent  
          news reports of HOA's fining homeowners for under-watering their  
          lawns."  
           
          Related Legislation  :  
           
          AB 2100 (Campos) of the current legislative session would  
          prohibit an HOA from fining a homeowner for yard maintenance  
          issues related to under-watered plants during a period of time  
          that the governor has declared a state of emergency due to a  
          drought.  This bill is pending hearing in the Assembly Housing  
          and Community Development Committee.

          AB 1636 (Brown) of the current legislative session would  
          prohibit an HOA from fining a homeowner who does not water his  
          or her lawn during a period that the Governor has declared a  
          state of emergency due to a drought.  This bill is pending  
          hearing in the Assembly Housing and Community Development  
          Committee.








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          SB 992 (Nielsen) of the current legislative session would  
          prohibit an HOA from fining a homeowner for yard maintenance  
          issues related to under-watered plants during a period of time  
          that the governor has declared a state of emergency due to a  
          drought.  This bill is pending in the Senate Transportation and  
          Housing Committee. 

          SB 1144 (Galgiani) of the current legislative session would  
          prohibit an HOA from fining a homeowner for yard maintenance   
          related to under-watered plants during a period of time that the  
          governor has declared a state of emergency due to a drought.   
          This bill is pending in the Senate Transportation and Housing  
          Committee. 


           Analysis Prepared by  :    Lisa Engel / H. & C.D. / (916) 319-2085  



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