BILL ANALYSIS Ó
AB 634
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ASSEMBLY THIRD READING
AB
634 (Calderon)
As Amended April 28, 2015
Majority vote
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|Committee |Votes |Ayes |Noes |
| | | | |
| | | | |
|----------------+------+-----------------------+--------------------|
|Privacy |11-0 |Gatto, Wilk, Baker, | |
| | |Calderon, Chang, Chau, | |
| | |Cooper, Dababneh, | |
| | |Dahle, Gordon, Low | |
| | | | |
| | | | |
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SUMMARY: Provides a process for a time-share property owner to
communicate with other owners within a time-share association on
matters related to legitimate association business, without
requiring the release of the owner list. Specifically, this bill:
1)Prohibits a time-share association from publishing a list of
owners or providing a list of it to any time-share interest
owner or to any third party, or use or sell the list for
commercial purposes, except to accomplish legitimate association
business, as specified.
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2)Requires the board of administration (board) or managing entity
of a time-share owner's association to determine whether a
request from an owner to communicate by mail with the membership
of the association pertains to legitimate association business,
as defined.
3)Requires the board or managing entity to make the requested
mailing within 30 days of receipt of the request and payment for
actual costs if the mailing pertains to legitimate association
business.
4)Requires the board or managing entity to notify the requesting
owner in writing with reasons for rejection if the board or
managing entity determines that the requested mailing will not
advance legitimate association business.
5)Requires the requesting owner to pay the association in advance
for the actual costs of the mailing.
6)Requires the association to make a good faith effort to minimize
the costs of the mailing, including the use of a less expensive
delivery method with respect to those owners who have previously
consented to such methods.
7)Where the requested mailing is a proxy solicitation related to a
board recall or management discharge, and the board of
administration or managing entity does not complete the
requested mailing within 30 days after receipt and payment, the
requesting owner may petition a local court on an expedited
basis to order the mailing.
8)Authorizes the court to order the board or managing entity to
pay the owner's costs, including attorney's fees, unless the
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board or the managing entity can prove it refused to distribute
the materials in good faith because of reasonable doubt about
whether the requested mailing pertained to legitimate
association business.
9)Reiterates that proxy solicitations must comply with the
provisions of this bill and existing law.
10)Prohibits the board or managing entity from refusing to
distribute a communication requested by an owner if the
requested mailing would address legitimate association business.
11)Declares that provisions relating to the right of inspection of
records and reports of nonprofit mutual benefit corporations do
not apply to time-share associations regulated under the
Vacation Ownership and Time-share Act of 2004.
12)Makes findings and declarations related to the need to provide
privacy protections for time-share association membership lists
and other technical or non-substantive changes.
FISCAL EFFECT: None. This bill is keyed non-fiscal by the
Legislative Counsel.
COMMENTS:
1)Purpose of this bill. This bill is intended to protect
time-share owner privacy by creating a process for owners to
communicate with one another about legitimate association
business without requiring the association to release the owner
list, and exempting time-share associations from existing
requirements for the sharing of member lists that apply to
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certain types of nonprofits. This bill is sponsored by the
American Resort Development Association and its related resort
owner coalition.
2)This bill in practice. While explicitly exempting time-shares
from the general record access provisions in the Corporations
Code pertaining to non-profit mutual benefit corporations, the
most recent version of this bill has some additional protections
for owners and requesters added to it. In practice, this bill
would generally prohibit the sharing of the owner's list with
any owner or third party, except for legitimate association
business. It requires the board to make mailings requested by
owners within 30 days of the request and payment of costs, and
further requires the association to provide any rejection in
writing to the requester with an explanation of the reasons for
the denial. This bill would also require the association to
make a good faith effort to minimize the cost of a mailing,
which could include the use of email for those owners who have
consented. In cases where the requested mailing relates to a
proposed recall of board members or discharge of the management
company, a requester may seek expedited action from a local
court if the association does not act within 30 days. The court
may also order the payment of the requester's court costs if the
association cannot show that its refusal was reasonable and in
good faith.
Analysis Prepared by: Hank Dempsey / P. &
C.P. / (916) 319-2200 FN: 0000302
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