BILL ANALYSIS Ó AB 905 Page 1 Date of Hearing: April 22, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 905 (Beth Gaines) - As Introduced February 26, 2015 ----------------------------------------------------------------- |Policy |Business and Professions |Vote:|14 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: YesReimbursable: No SUMMARY: This bill authorizes a time-share developer, who creates a time-share plan or is in the business of selling time-share interests, to provide to a purchaser a mandated public report or other disclosures in a digital format at the discretion of the purchase. The bill also corrects a drafting oversight from previous legislation regarding inspection and AB 905 Page 2 disclosure requirement exemptions. FISCAL EFFECT: Costs are minor and absorbable within existing California Bureau of Real Estate (CalBRE) resources. COMMENTS: 1)Purpose. According to the author, "California law requires a number of disclosures to protect Californians who purchase timeshares. However, in this modern and increasingly paperless world, many consumers would prefer not to get these sometimes bulky disclosures in paper form. [This bill] allows the disclosures to be made electronically - at the discretion of the purchaser." 2)Background. CalBRE, in addition to administering and enforcing laws governing the sale of subdivided lots and common interest developments, also administers and enforces laws governing the sale of time-share interests. Time-share interests in a time-share project, also known as a time-share plan, sold in California, whether the plan is located in California or outside the state, are subject to regulation under The Vacation Ownership and Time-share Act of 2004 (time-share Act). The time-share Act requires a Time-share Plan Conditional or Final Public Report be issued and a copy given to each purchaser prior to the execution of a sales contract for a sale of a time-share. A copy of this report must also be given to any member of the public who requests one. The Time-share Final Plan Public Report is issued only after the AB 905 Page 3 developers comply with the provisions of all the applicable laws and regulations. Existing law mandates that the developer prepare the public report, and that the public report include the specific disclosures as required by that statute. According to the author, a number of states allow electronic disclosure of timeshare documents including: Arizona, Arkansas, Florida, Illinois, Louisiana, Nevada, New York, and Virginia. This bill proposes to allow the report to be offered in writing (as in existing law) or in a digital format at the discretion of the purchaser. 3)Prior Legislation. AB 2252 (Montanez), Chapter 697, Statutes of 2004, enacted the "Vacation Ownership and Time-share Act of 2004," consolidated and revised the entire body of time-share vacation property regulation, streamlined the regulatory approval process, and added new consumer protections. Analysis Prepared by:Jennifer Swenson / APPR. / (916) 319-2081 AB 905 Page 4