BILL NUMBER: AB 985 AMENDED
BILL TEXT
AMENDED IN SENATE JULY 1, 2009
AMENDED IN SENATE JUNE 9, 2009
INTRODUCED BY Assembly Member De La Torre
(Coauthor: Assembly Member Krekorian)
FEBRUARY 27, 2009
An act to amend Sections 12956.1, 12956.2, and 27361 of, and to
add Article 3.6 (commencing with Section 27310) to Chapter 6 of Part
3 of Division 2 of Title 3 of, the Government Code, relating to real
property.
LEGISLATIVE COUNSEL'S DIGEST
AB 985, as amended, De La Torre. Real property: discriminatory
restrictions.
(1) Existing law prohibits discrimination in housing through
restrictive covenants based on race, color, religion, sex, sexual
orientation, familial status, marital status, disability, national
origin, source of income, or ancestry and provides that
discrimination in housing through a restrictive covenant includes the
existence of a restrictive covenant regardless of whether
accompanied by a statement that the covenant is repealed or void.
Existing law similarly declares that any provision in any deed of
real property in California that purports to restrict the right of
any person to sell, lease, rent, use, or occupy the property to
persons having any specified characteristic, including, but not
limited to, race, color, religion, sex, marital status, national
origin, ancestry, familial status, disability, source of income, or
sexual orientation, by providing for payment of a penalty,
forfeiture, reverter, or otherwise, is void, except as specified.
Existing law provides that any deed or other written instrument
that relates to title to real property, or any written covenant,
condition, or restriction annexed or made a part of, by reference or
otherwise, any deed or instrument, that contains any provision that
purports to forbid, restrict, or condition the right of any person or
persons to sell, buy, lease, rent, use, or occupy the property on
account of any of the above-specified characteristics, shall be
deemed to be revised to omit that provision.
Existing law also authorizes a person who holds an ownership
interest of record in property that he or she believes is the subject
of an unlawfully restrictive covenant based on race, color,
religion, sex, sexual orientation, familial status, marital status,
disability, national origin, source of income, or ancestry, to record
a restrictive covenant modification
Restrictive Covenant Modification , which would include a copy
of the original document with the illegal language stricken. Before
recording the modification document, the county recorder is required
to submit the modification document and the original document to the
county counsel who is required to determine whether the original
document contains an unlawful restriction based on race, color,
religion, sex, sexual orientation, familial status, marital status,
disability, national origin, source of income, or ancestry. The
county recorder is required to make available to the public
restrictive covenant modification Restrictive Covenant
Modification forms available to the public . Under
existing law, a county recorder, title insurance company, escrow
company, real estate broker, real estate agent, or association that
provides a copy of a declaration, governing document, or deed to any
person is required to place a cover page or stamp on the previously
recorded document stating that if the document contains an unlawful
restriction, that the restriction is void and may
be removed by recording a restrictive covenant modification
Restrictive Covenant Modification .
This bill would require a county recorder, title insurance
company, escrow company, real estate broker, real estate agent, or
association that provides a copy of a declaration, governing
document, or deed to any a person
who holds an ownership interest of record in property to also
provide a restrictive covenant modification
Restrictive Covenant Modification form with
instructions specified procedural information to
that person. The bill would authorize a title insurance company,
escrow company, real estate broker, real estate agent, or other
person to record a restrictive covenant modification
Restrictive Covenant Modification , in addition
to the owner of record, and would require the county
recorder to notify each owner of record and the requester
to provide a return address in order for the county recorder to
notify the interested party of the action taken on
that request by county counsel on the respective
property . The bill would require the county counsel to make
its determination whether the original document contains an unlawful
restriction within a reasonable period of time, not to exceed 3
months, as specified, and would authorize the county counsel to
compile a list of phrases identified as unlawfully restrictive
language for the purpose of expediting that determination. The bill
would require restrictive covenant modification forms to
include instructions for completion and would permit submissions on
behalf of several homes or in lots the county recorder
to make Restrictive Covenant Modification forms available to the
public onsite in an appropriately designated area, and would permit
multiple submissions on behalf of different homes and for processing
homes in batches with respect to a modification document that affects
multiple homes or lots . These new duties would impose a
state-mandated local program on the county recorder and county
counsel.
(2) Existing law requires the recorder of each county to establish
a social security number truncation program in order to create a
public record version of each official record so that the public
record is in an electronic format and is an exact copy of the
official record, except that any social security number contained in
the official record shall be truncated by redacting the first 5
digits of that number. These provisions apply to any document
recorded since January 1, 1980, as specified. If a public record
version of an official record exists, and upon a request of any
person to inspect, copy, or to otherwise publicly disclose that
record, the recorder shall make available only the public record
version of that record, and publicly disclose the official record
only in response to a subpoena or court order. The county recorder
may, upon authorization of the board of supervisors, charge an
additional fee of $1 for recording the first page of each document to
be used to implement a social security number truncation program
pursuant to these provisions. The county auditor is required, at the
request of the county board of supervisors, to verify that these fees
are used only for the purpose of the program.
This bill would require the recorder of each county to create a
public record version of each official record for which a restrictive
covenant modification is recorded on or after January 1, 2010, so
that the public record is in an electronic format and is an exact
copy of the official record, except that any unlawfully restrictive
covenant contained in the official record shall be redacted. The
bill would require the county recorder also to convert the official
record into an electronic format at that time. If a public
record version of an official record exists, and upon request of any
person to inspect, copy, or to otherwise publicly disclose that
record, the recorder shall make available only the public record
version of that record, and publicly disclose the official record
only in response to a subpoena or court order. The bill would
provide that the county recorder shall not incur any liability for a
procedural, clerical, or administrative error in the recording of a
modification document or any other activity related to the redaction
of an unlawfully restrictive covenant pursuant to these
provisions. The bill would authorize the county
recorder may , upon authorization of the board of
supervisors, as specified, to charge an additional $3
fee in an unspecified amount for recording
the first page of each document to be used to implement
these provisions. The county auditor is required, at the request of
the county board of supervisors, to verify that these fees are used
only for that purpose by the county recorder for the
performance of any activity related to the redaction of an unlawfully
restrictive covenant pursuant to these provisions or those described
in (1) above. The bill would authorize the board of supervisors to
increase or decrease that fee to recover the costs of providing any
product or service or enforcing any regulation for which the fee
described above is levied. The bill would also provide that if any
person disputes whether the fee levied is reasonable, the board may
request the county auditor to conduct a study to determine
whether the fee is reasonable. By creating new duties for
county recorders and auditors , this bill would
impose a state-mandated local program.
(3) This bill would make legislative findings that any limitation
on the public's right of access to the writings of public officials
and agencies made by its provisions is necessary to protect against
the risk of discrimination.
(4) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that, if the Commission on State Mandates
determines that the bill contains costs mandated by the state,
reimbursement for those costs shall be made pursuant to these
statutory provisions.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 12956.1 of the Government Code is amended to
read:
12956.1. (a) As used in this section, "association," "governing
documents," and "declaration" have the same meanings as set forth in
Section 1351 of the Civil Code.
(b) (1) A county recorder, title insurance company, escrow
company, real estate broker, real estate agent, or association that
provides a copy of a declaration, governing document, or deed to
any person shall also provide a Restrictive Covenant
Modification form with instructions and any person
shall place a cover page or stamp on the first page of the
previously recorded document or documents stating, in at least
14-point boldface type, the following:
"If this document contains any restriction based on race, color,
religion, sex, sexual orientation, familial status, marital status,
disability, national origin, source of income as defined in
subdivision (p) of Section 12955, or ancestry, that restriction
violates state and federal fair housing laws and is void, and may be
removed pursuant to Section 12956.2 of the Government Code. Lawful
restrictions under state and federal law on the age of occupants in
senior housing or housing for older persons shall not be construed as
restrictions based on familial status."
(2) The requirements set forth in paragraph (1) shall not apply to
documents being submitted for recordation to a county recorder.
(3) A county recorder, title insurance company, escrow company,
real estate broker, real estate agent, or association that provides a
copy of a declaration, governing document, or deed directly to a
person who holds an ownership interest of record in property shall
also provide a Restrictive Covenant Modification form with procedural
information, as defined subdivision (b) of Section 27310, along with
the document.
(c) Any person who records a document for the express purpose of
adding a racially restrictive covenant is guilty of a misdemeanor.
The county recorder shall not incur any liability for recording the
document. Notwithstanding any other provision of law, a prosecution
for a violation of this subdivision shall commence within three years
after the discovery of the recording of the document.
SEC. 2. Section 12956.2 of the Government Code is amended to read:
12956.2. (a) A person who holds an ownership interest of record
in property that he or she believes is the subject of an unlawfully
restrictive covenant in violation of subdivision (l) of Section 12955
may record a document titled Restrictive Covenant Modification. A
title insurance company, escrow company, real estate broker, real
estate agent, or other person also may record the modification
document provided for in this section. The county recorder may choose
to waive the fee prescribed for recording and indexing instruments
pursuant to Section 27361 in the case of the modification document.
The modification document shall include a complete copy of the
original document containing the unlawfully restrictive language with
the unlawfully restrictive language stricken.
(b) Before recording the modification document, the county
recorder shall submit the modification document and the original
document to the county counsel who shall determine whether the
original document contains an unlawful restriction based on race,
color, religion, sex, sexual orientation, familial status, marital
status, disability, national origin, source of income as defined in
subdivision (p) of Section 12955, or ancestry. The county counsel
shall return the documents and inform the county recorder of its
determination within a reasonable period of time, not to exceed three
months unless extraordinary circumstances apply. The county recorder
shall refuse to record the modification document if the county
counsel finds that the original document does not contain an unlawful
restriction as specified in this subdivision. For the purpose of
expediting the determination required pursuant to this subdivision,
the county counsel may compile a list of phrases identified as
unlawfully restrictive language.
(c) If a title insurance company, escrow agent, realtor, or other
person requests to record a modification document, the
county recorder shall notify each person who holds an ownership
interest of record in the property of that request and the action
taken. The requestor also shall be notified as to the action taken on
the request; however, that notice shall not include the name of any
owner of record or any confidential information regarding the
property. The notices required pursuant to this section may be
requester shall provide a return address in order for
the county recorder to notify the interested party of the action
taken by county counsel on the respective property. The notice
required pursuant to this subdivision may be made on
a postcard mailed by first-class mail.
(d) The modification document shall be indexed in the same manner
as the original document being modified. It shall contain a recording
reference to the original document in the form of a book and page or
instrument number, and date of the recording.
(e) Subject to covenants, conditions, and restrictions that were
recorded after the recording of the original document that contains
the unlawfully restrictive language and subject to covenants,
conditions, and restrictions that will be recorded after the
Restrictive Covenant Modification, the restrictions in the
Restrictive Covenant Modification, once recorded, are the only
restrictions having effect on the property. The effective date of the
terms and conditions of the modification document shall be the same
as the effective date of the original document.
(f) The county recorder shall make available to the public
Restrictive Covenant Modification forms. Those forms shall
include instructions for completion and shall permit submissions on
behalf of several homes or in lots for processing in batches.
forms onsite in an appropriately designated area,
which shall be deemed to satisfy the requirement of paragraph (1) of
subdivision (b) of Section 12956.1 to provide a Restrictive Covenant
Modification form if the specified procedural information for
completio n is attached to the form. Those forms shall
permit multiple submissions on behalf of different homes and for
processing homes in batches with respect to a modification document
that affects multiple homes or lots.
(g) If the holder of an ownership interest of record in property
or a third party causes to be recorded a modified document
pursuant to this section that contains modifications not authorized
by this section, the county recorder shall not incur liability for
recording the document. The liability that may result from the
unauthorized recordation is the sole responsibility of the holder of
the ownership interest of record or third party who caused
the modified recordation.
(h) This section does not apply to persons holding an ownership
interest in property that is part of a common interest development as
defined in subdivision (c) of Section 1351 of the Civil Code if the
board of directors of that common interest development is subject to
the requirements of subdivision (b) of Section 1352.5 of the Civil
Code.
SEC. 3. Article 3.6 (commencing with Section 27310) is added to
Chapter 6 of Part 3 of Division 2 of Title 3 of the Government Code,
to read:
Article 3.6. Unlawfully Restrictive Covenant Redaction
27310. As used in this article, the following terms have the
following meanings:
(a) "Official record" means the permanent archival record of all
instruments, papers, and notices as accepted for recording by a
county recorder.
(b) "Procedural information," as it relates to a Restrictive
Covenant Modification, means the description of how to locate
potentially unlawful restrictive covenants and how to submit the
Restrictive Covenant Modification document to the county recorder for
appropriate processing. This description may, but is not required
to, use the following language:
Some archived property documents may contain offensive, illegal
language that purports to restrict ownership or occupancy of
property. These restrictions are illegal, and have no effect on
anyone's ability to own or occupy the property, but may still appear
in property documents as an unlawful restrictive covenant.
Sometimes these illegal restrictions appear only in archived
documents and may be found only by a review of those documents at the
office of the county recorder. You may search those documents for
free at the office of the county recorder, which is open to the
public. If you discover an illegal restriction, you may obtain a
Restrictive Covenant Modification form from the office of the county
recorder to request the removal of the illegal restriction.
After you complete the form and submit it to the office of the
county recorder, the county counsel will make a legal determination
whether the language is indeed unlawful and should be removed. If an
illegal restriction is found to exist, state law contains a procedure
for the creation of a replacement document that does not contain the
offensive language. This procedure may be used to remove illegal
restrictions from a declaration, governing document, or deed, even if
you are not the owner.
(b)
(c) "Public record" means a record that is in an
electronic format and is an exact copy of an official record except
that any unlawfully restrictive covenant contained in the copied
record is redacted and any social security number contained in
the copied record is truncated pursuant to Article 3.5 (commencing
with Section 27300) . The public record shall have the same
legal force and effect as the official record.
(c)
(d) "Unlawfully restrictive covenant" means any written
covenant, condition, or restriction annexed or made a part of, by
reference or otherwise, a deed or other instrument in violation of
subdivision (l) of Section 12955.
27311. (a) The county recorder of each county shall create a
public record version of each official record for which a Restrictive
Covenant Modification is recorded pursuant to Section 12956.2 on or
after January 1, 2010. The public record shall be in an electronic
format and an exact copy of the official record, except that any
unlawfully restrictive covenant contained in the official record
shall be redacted. The official record also shall be converted
into an electronic format at that time.
(b) Nothing in this article shall be construed to restrict, delay,
or modify access to any official record, or modify any existing
agreements regarding access to any official record, prior to the
creation and availability of a public record version of that official
record. A county recorder shall not charge any new fee or increase
any existing fees in order to fund the redaction of unlawfully
restrictive covenants pursuant to this article, except as provided in
subdivision (e) of Section 27361.
(c) Notwithstanding subdivision (a), a county recorder shall not
be required to create a public record version of an official record
if the fee authorized in Section 27314 is determined by the recorder
to be insufficient to meet the cost of creating the public record
version.
(c) The county recorder shall not incur any liability for a
procedural, clerical, or administrative error in the recording of a
modification document or any other activity related to the redaction
of an unlawfully restrictive covenant pursuant to this article.
27313. If a public record version of an official record exists,
both of the following shall apply:
(a) Upon a request for inspection, copying, or any other public
disclosure of an official record that is not exempt from disclosure,
a county recorder shall make available only the public record version
of that record.
(b) A county recorder shall publicly disclose an official record
only in response to a subpoena or order of a court of competent
jurisdiction.
27314. (a) Each county may use funds generated by fees authorized
by subdivision (e) of Section 27361 to implement this article.
(b) No later than June 1, 2010, the county recorder of each county
shall petition the board of supervisors in that county for the
authority to levy the fee authorized by subdivision (e) of Section
27361.
(c) It is the intent of the Legislature that counties be permitted
to seek revenue anticipation loans or other outside funding sources
for the implementation of this article to be secured by the
anticipated revenue from the fee authorized by subdivision (e) of
Section 27361.
27317. A county recorder is authorized to take all actions
required by this article notwithstanding subdivision (d) of Section
27203 or any other provision of law.
SEC. 4. Section 27361 of the Government Code is amended to read:
27361. (a) The fee for recording and indexing every instrument,
paper, or notice required or permitted by law to be recorded is four
dollars ($4) for recording the first page and three dollars ($3) for
each additional page, except the recorder may charge additional fees
as follows:
(1) If the printing on printed forms is spaced more than nine
lines per vertical inch or more than 22 characters and spaces per
inch measured horizontally for not less than three inches in one
sentence, the recorder shall charge one dollar ($1) extra for each
page or sheet on which printing appears, except, however, the extra
charge shall not apply to printed words which are directive or
explanatory in nature for completion of the form or on vital
statistics forms. Fees collected under this paragraph are not subject
to subdivision (b) or (c).
(2) If a page or sheet does not conform with the dimensions
described in subdivision (a) of Section 27361.5, the recorder shall
charge three dollars ($3) extra per page or sheet of the document.
The funds generated by the extra charge authorized under this
paragraph shall be available solely to support, maintain, improve,
and provide for the full operation for modernized creation,
retention, and retrieval of information in each county's system of
recorded documents. Fees collected under this paragraph are not
subject to subdivision (b) or (c).
(b) One dollar ($1) of each three dollar ($3) fee for each
additional page shall be deposited in the county general fund.
(c) Notwithstanding Section 68085, one dollar ($1) for recording
the first page and one dollar ($1) for each additional page shall be
available solely to support, maintain, improve, and provide for the
full operation for modernized creation, retention, and retrieval of
information in each county's system of recorded documents.
(d) (1) In addition to all other fees authorized by this section,
a county recorder may charge a fee of one dollar ($1) for recording
the first page of every instrument, paper, or notice required or
permitted by law to be recorded, as authorized by each county's board
of supervisors. The funds generated by this fee shall be used only
by the county recorder collecting the fee for the purpose of
implementing a social security number truncation program pursuant to
Article 3.5 (commencing with Section 27300).
(2) A county recorder shall not charge the fee described in
paragraph (1) after December 31, 2017, unless the county recorder has
received reauthorization by the county's board of supervisors. A
county recorder shall not seek reauthorization of the fee by the
board before June 1, 2017, or after December 31, 2017. In determining
the additional period of authorization, the board shall consider the
review described in paragraph (4).
(3) Notwithstanding paragraph (2), a county recorder who, pursuant
to subdivision (c) of Section 27304, secures a revenue anticipation
loan, or other outside source of funding, for the implementation of a
social security number truncation program, may be authorized to
charge the fee described in paragraph (1) for a period not to exceed
the term of repayment of the loan or other outside source of funding.
(4) A county board of supervisors that authorizes the fee
described in this subdivision shall require the county auditor to
conduct two reviews to verify that the funds generated by this fee
are used only for the purpose of the program, as described in Article
3.5 (commencing with Section 27300) and for conducting these
reviews. The reviews shall state the progress of the county recorder
in truncating recorded documents pursuant to subdivision (a) of
Section 27301, and shall estimate any ongoing costs to the county
recorder of complying with subdivisions (a) and (b) of Section 27301.
The board shall require that the first review be completed not
before June 1, 2012, or after December 31, 2013, and that the second
review be completed not before June 1, 2017, or after December 31,
2017. The reviews shall adhere to generally accepted accounting
standards, and the review results shall be made available to the
public.
(e) (1) In addition to all other fees authorized by this section,
a county recorder may charge a fee of ___ dollars ($___)
of no more than three dollars ($3) for recording
the first page of every instrument, paper, or notice required or
permitted by law to be recorded, as authorized by each county's board
of supervisors. The funds generated by this fee shall be used only
by the county recorder collecting the fee for the purpose of
implementing performing any activity related to the
redaction of an unlawfully restrictive covenant pursuant to Sections
12956.1 and 12956.2, and Article 3.6 (commencing with Section
27310).
(2) A county recorder who, pursuant to subdivision (c) of Section
27314, secures a revenue anticipation loan, or other outside source
of funding, for the implementation of Article 3.6 (commencing with
Section 27310), may be authorized to charge the fee described in
paragraph (1) for a period not to exceed the term of repayment of the
loan or other outside source of funding.
(3) A county board of supervisors that authorizes the fee
described in this subdivision shall require the county auditor to
conduct two reviews to verify that the funds generated by this fee
are used only for the purpose of implementing Article 3.6 (commencing
with Section 27310) and for conducting these reviews. The reviews
shall estimate any ongoing costs to the county recorder of complying
with subdivision (a) of Section 27311. The board shall require that
the first review be completed not before June 1, 2014, or after
December 31, 2015, and that the second review be completed not before
June 1, 2019, or after December 31, 2019. The reviews shall adhere
to generally accepted accounting standards, and the review results
shall be made available to the public.
(2) The fee described in paragraph (1) shall be reauthorized by
the county board of supervisors every five years.
(3) The county recorder shall fulfill the requirements of Sections
12956.1 and 12956.2, and Article 3.6 (commencing with Section
27310), regardless of whether the county board of supervisors
authorizes the fee described in paragraph (1).
(4) Notwithstanding paragraph (1), a county board of supervisors
shall have the authority to increase or decrease the fee described in
paragraph (1) in an amount reasonably necessary to recover the cost
of providing any product or service or the cost of enforcing any
regulation for which the fee is levied. The fee may reflect the
average cost of providing any product or service or of enforcing any
regulation. Indirect costs that may be reflected in the cost of
providing any product or service or the cost of enforcing any
regulation shall be limited to those items that are included in the
federal Office of Management and Budget Circular A-87 on January 1,
1984.
(5) If any person disputes whether a fee levied pursuant to
paragraph (1) is reasonable, the board of supervisors may request the
county auditor to conduct a study to determine whether the fee is
reasonable.
(6) Nothing in this subdivision shall be construed to mean that
the county shall not continue to be subject to fee review procedures
required by Article XIII B of the California Constitution.
SEC. 5. The Legislature finds and declares that Section 3 of this
act imposes a limitation on the public's right of access to the
meetings of public bodies or the writings of public officials and
agencies within the meaning of Section 3 of Article I of the
California Constitution. Pursuant to that constitutional provision,
the Legislature makes the following finding to demonstrate the
interest protected by this limitation and the need for protecting
that interest:
In order to protect against the risk of discrimination when
government documents maintained by county recorders contain
unlawfully restrictive covenants, it is necessary to enact
legislation that minimizes the existence of unlawfully restrictive
covenants in those government documents.
SEC. 6. If the Commission on State Mandates determines that this
act contains costs mandated by the state, reimbursement to local
agencies and school districts for those costs shall be made pursuant
to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of
the Government Code.