BILL ANALYSIS �
SB 209
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Date of Hearing: June 21, 2011
ASSEMBLY COMMITTEE ON JUDICIARY
Mike Feuer, Chair
SB 209 (Corbett) - As Amended: June 6, 2011
SENATE VOTE : 25-14
SUBJECT : COMMON INTEREST DEVELOPMENTS: ELECTRIC VEHICLE
CHARGING STATIONS
KEY ISSUE: SHOULD COMMON INTEREST DEVELOPMENTS BE PREVENTED
FROM ENFORCING RESTRICTIONS THAT EFFECTIVELY PROHIBIT OR CREATE
UNREASONABLE BARRIERS TO THE INSTALLATION OF ELECTRIC VEHICLE
CHARGING EQUIPMENT BY HOMEOWNERS IN SUCH DEVELOPMENTS?
FISCAL EFFECT : As currently in print this bill is keyed
non-fiscal.
SYNOPSIS
This bill represents a proactive approach to eliminate what the
author anticipates may pose a potential but significant obstacle
to increased ownership of plug-in electric vehicles (PEVs) in
California, particularly among the estimated 25% of Californians
who live in housing units that are located in a common interest
development (CID). Ownership of a PEV is a much more difficult
proposition if the vehicle owner cannot, for whatever reason,
install charging equipment at home to recharge the vehicle's
battery. This bill seeks to prohibit CIDs from enforcing
restrictions in their governing documents that effectively
prohibit or create unreasonable barriers to the installation of
electric vehicle charging equipment by their member homeowners.
The bill also specifies the duties and responsibilities that
fall upon homeowners as condition of installing and maintaining
the electric vehicle charging equipment within the CID. The
bill also provides for actual damages, civil liability up to
$1,000, and reasonable attorney's fees to be awarded to a
plaintiff homeowner who can show that the homeowner association
of the CID willfully violated these provisions in approving or
denying an application to install charging equipment. This bill
is supported by a broad coalition of organizations, including
environmental groups, regional air quality districts, electric
vehicle advocates and makers, and the American Lung Association.
This bill was approved unanimously by the Assembly Housing and
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Community Development Committee, and currently has no registered
opposition.
SUMMARY : Prohibits common interest developments (CIDs) from
prohibiting or enforcing unreasonable restrictions against the
installation of electric vehicle charging equipment by member
homeowners. Specifically, this bill :
1)Provides that any covenant, restriction, or condition
contained in any deed, contract, or other instrument affecting
the transfer or sale of any interest in a CID, and any
provision of a governing document, that effectively prohibits
or restricts the installation or use of an electric vehicle
charging station is void and unenforceable.
2)Permits CIDs to impose "reasonable restrictions" on electric
vehicle charging stations, defined as restrictions that do not
significantly increase the cost of the station or decrease its
efficiency or performance.
3)Declares that it is the policy of the state to promote,
encourage, and remove obstacles to the use of electric vehicle
charging stations.
4)Requires the CID to process and approve an application to
install an electric charging station in the same manner as an
architectural modification to the property and to not
willfully delay or avoid approval. Further requires the
approval or denial of the application to be in writing, and
provides that if an application is not denied within 60 days
of receipt, then the application will be deemed approved
unless the delay was the result of a reasonable request for
additional information.
5)Provides that if an electric vehicle charging station is to be
placed in the common area or an exclusive use common area, the
owner must obtain approval from the CID to install the
electric vehicle charging station.
6)Provides that if an electric vehicle charging station is to be
placed in the common area or an exclusive use common area, the
CID shall approve the installation if the homeowner agrees in
writing to do all the following:
a) Comply with the CID's architectural standards for
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installation;
b) Engage a licensed contractor to install the station;
c) Within 14 days of approval, provide a certification of
insurance that names the CID as an additional insurer under
the homeowner's insurance policy;
d) Pay for the electricity usage associated with the
station.
1)Requires that any owner and each successive owner of the
parking stall on which or near where the electric vehicle
charging station is placed to be responsible for specified
costs associated with installation, maintenance, and repair,
as well as for the duty to
disclose to prospective buyers the existence of the charging
station and the related responsibilities of the homeowner.
2)Requires the homeowner and each successive homeowner to
maintain an umbrella liability coverage policy for $1 million
that names the CID as an additional insured under the policy
with a right to notice of cancellation.
3)Provides that a CID that willfully violates these provisions
is liable to the applicant or other party for actual damages
and shall pay a civil penalty to the applicant or other party
in an amount not to exceed $1000.
4)Provides in any action to enforce compliance with this section
the prevailing plaintiff is entitled to reasonable attorney
fees.
EXISTING LAW :
1)Defines "governing documents" to mean the recorded declaration
and any other documents, such as bylaws, operating rules of
the association, articles of incorporation, or articles of
association, which govern the operation of the common interest
development or association. (Civil Code Section 1351 (j).)
2)Provides that any covenant, restriction, or condition
contained in any deed, contract, or other instrument affecting
the transfer or sale of real property, and any provision of a
governing document of a CID that effectively prohibits or
restricts the installation or use of a solar energy system is
void and unenforceable. (Civil Code Section 714(a).)
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3)Permits reasonable restrictions on solar energy systems that
do not significantly increase the cost of the system or
significantly decrease its efficiency or specified
performance. (Civil Code Section 714(b).)
4)Allows a CID to impose reasonable restrictions on the
installation of solar energy systems, including requiring an
owner to obtain the approval of the CID prior to installing a
system in a common area or in another owner's separate
interest. (Civil Code Section 714.1).
5)Establishes the Alternative and Renewable Fuel and Vehicle
Technology Program, administered by the State Energy Resources
Conservation and Development Commission, and authorizes the
Commission to create a program to provide funding for
homeowners who purchase a plug-in electric vehicle to offset
costs associated with modifying electrical sources to include
a residential plug-in electric vehicle charging station.
(Health and Safety Code Section 44272(d)(13).)
COMMENTS : This bill represents a proactive approach to
eliminate what the author anticipates may pose a potential but
significant obstacle to increased ownership of plug-in electric
vehicles (PEVs) in California, particularly among the estimated
25% of Californians who live in housing units that are located
in a common interest development (CID). Ownership of a PEV is a
much more difficult proposition if the vehicle owner cannot, for
whatever reason, install charging equipment at home to recharge
the vehicle's battery. This bill seeks to prohibit CIDs from
enforcing restrictions in their governing documents that
effectively prohibit or create unreasonable barriers to the
installation of electric vehicle charging equipment by their
member homeowners. The bill also specifies the duties and
responsibilities that fall upon homeowners as condition of
installing and maintaining the electric vehicle charging
equipment within the CID. The bill also provides for actual
damages, civil liability up to $1,000, and reasonable attorney's
fees to be awarded to a plaintiff homeowner who can show that
the homeowner association of the CID willfully violated these
provisions in approving or denying an application to install
charging equipment.
Stated need for the bill: According to the author, this bill
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idea was inspired by events from the state of Hawaii, where a
homeowner's association prohibited one of its members who owned
a PEV from installing a charging station on the property. In
response, Hawaii passed bipartisan legislation in 2010 that,
like this bill, limits the ability of CIDs to prohibit or
unreasonably restrict the installation of electric vehicle
charging equipment.
According to the author:
Allowing CIDs to impose prohibitions on the installation
of electric vehicle chargers interferes with the PEV
market. CIDs enacting such a prohibition raise the
transaction cost of prospective buyers of PEVs who live
in CIDs. These prospective buyers may be forced to go
through a cumbersome and possibly expensive and litigious
process to obtain permission from the CID to install
charging equipment. This daunting process shuts out
Californians living in CIDs who want to drive clean
electric vehicles.
As the California Plug-In Electric Vehicle Collaborative
notes, "The convenience of charging at home is one of the
most appreciated benefit of PEV ownership. By simplifying
the installation process for residential charging
stations, stakeholders can bring down upfront costs for
consumers and ensure positive purchase and use
experiences with PEVs. Positive early consumer
experiences will proliferate and push the market
forward."
Background on common interest developments . There are nearly
50,000 common interest developments (CIDs) in California that
vary in size and structure, but generally speaking, CIDs are
multi-unit communities characterized by the following: (1)
separate ownership of individual residential units coupled with
an undivided interest in common property; (2) covenants,
conditions, and restrictions (CC&Rs) that limit the use of both
separate interests and common property; and (3) management of
common property and enforcement of restrictions by a homeowner's
association (HOA).
Under the Davis-Stirling Act (Civil Code Section 1350 et seq.),
which sets forth general rules governing common interest
developments, each individual CID is subject to rules and
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regulations set forth by the HOA's "governing documents." These
governing documents include the recorded declaration and any
other documents, such as bylaws, operating rules of the
association, or articles of incorporation that govern the
operation of the association. (Civil Code Section 1351(j).)
CIDs are governed by volunteer boards of directors who are
elected by the members of the HOA and who are responsible for
interpreting the governing documents and state law. Except when
CIDs are first developed, no state agency provides ongoing
oversight to these communities. In order to amend the governing
documents, an HOA must follow the procedure outlined in their
governing documents, or if the governing documents are silent,
the process provided in state law. State law and most governing
documents require that a majority of members vote to approve an
amendment to the governing documents. The governing documents
of CIDs typically contain many restrictions over aspects of use,
appearance, and transferability of interest of the property, and
it is not hard to imagine that some HOAs may elect in the future
to adopt restrictions regarding the installation of PEV charging
equipment.
This bill adopts an early problem-solving approach to an
imminent potential problem . Currently, the Committee is not
aware of any reports of CIDs in California that have actually
prohibited a member from installing such charging equipment
pursuant to the CID's governing documents. However, it may be
just a matter of time before such a scenario arises,
particularly with projections of a sharp increase in the number
of PEVs sold in California. For example, the California
Electric Transportation Coalition estimates that by the end of
2011 there will be between 1,000 to 3,000 plug-in electric
vehicles (PEVs) in California, with that number increasing to
125,000 to 250,000 vehicles by 2015. For these reasons, the
author proposes this bill to establish guidance in this area.
Specifically, this bill provides that any covenant, restriction,
or condition contained in any deed, contract, or other
instrument affecting the transfer or sale of any interest in a
CID, and any provision of a governing document, that effectively
prohibits or restricts the installation or use of an electric
vehicle charging station is void and unenforceable. The bill
does not prohibit a CID from regulating charging station
equipment at all, but establishes that CIDs may only impose
"reasonable restrictions" on electric vehicle charging stations,
which are defined as restrictions that do not significantly
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increase the cost of the station or decrease its efficiency or
performance. For example, among the restrictions that are
expressly allowed by this bill, homeowners must agree in
writing, as a condition of obtaining HOA approval of an
application to install a charging station, that they shall
comply with the CID's architectural standards for installation,
hire a licensed contractor to perform the work, and name the CID
as an additional insured under their homeowner insurance policy.
Civil liability provisions. The bill provides that a homeowner
association shall be liable to the homeowner for actual damages
and civil liability up to $1,000 for willfully violating these
provisions with respect to handling the homeowner's application
to install charging equipment. In addition, the bill requires
reasonable attorney's fees to be awarded to the prevailing
plaintiff in an action against the CID to enforce compliance
with this section. Prevailing plaintiff attorney's fee
statutes, such as this one, are intended to encourage persons to
pursue litigation which advances a specific public policy, or to
enhance the ability of aggrieved parties to enforce their rights
when the legal costs may otherwise be prohibitive. In this
case, the bill advances public policy "to promote, encourage,
and remove obstacles to the use of electric vehicle charging
stations" and would also allow a homeowner to enforce his or her
right to install charging equipment if he or she believed the
CID was willfully creating unreasonable restrictions to prevent
installation of the charging equipment.
ECHO cites Support if Amended position: The Executive Council
of Homeowners (ECHO), representing more than 1,550 community
associations that comprise its membership, submitted a letter to
the Committee stating a "Support If Amended" position. ECHO
reports it "has been working with the author's office on
amendments, including ones relative to encroachment on common
areas, insurance coverage and responsibility for costs." At the
time of this analysis, neither ECHO nor any other group had
registered official opposition to this bill.
ARGUMENTS IN SUPPORT : The bill is supported by electric vehicle
advocates and automobile manufacturers, who generally support
efforts to build up electric vehicle recharging infrastructure.
Plug In America, an organization "representing millions of
potential future customers of plug-in hybrids and electric
vehicles" writes in support:
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SB 209 will accelerate the market deployment of
electric vehicles by promoting the implementation of
plug-in charging infrastructure in apartments,
condominium, and other multifamily dwellings. SB 209
will significantly reduce the barriers for installation
of electric vehicle charging equipment in these kinds
of residences . . . and will support consumers who will
drive demand for the next generation of clean efficient
vehicles that run on domestic electricity.
The bill is also supported by air quality management districts
and environmental advocates, including the Natural Resources
Defense Council, which states:
California state policy is helping the nascent plug-in
electric vehicle industry grow in a manner consistent
with state goals to clean the air, create jobs, reduce
oil dependency, and develop an alternative fuels
market. Over thirty different plug-in electric vehicle
models are expected to be launched over the next
several years, based on recent industry forecasts.
Particularly at a time of rising oil prices, California
should ensure that barriers to adoption of
alternatively-fueled vehicles are removed. SB 209
takes a proactive step to ensure that plug-in electric
vehicles and charging infrastructure are supported in
homes across California.
REGISTERED SUPPORT / OPPOSITION :
Support
Alliance of Automobile Manufacturers
American Lung Association
Bay Area Air Quality Management District (BAAQMD)
California Electric Transportation Coalition
National Resources Defense Council (NRDC)
Plug In America
South Coast Air Quality Management District
Tesla Motors, Inc.
Union of Concerned Scientists
Support (If Amended)
Executive Council of Homeowners (ECHO)
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Opposition
None on file
Analysis Prepared by : Anthony Lew / JUD. / (916) 319-2334