BILL ANALYSIS �
SENATE JUDICIARY COMMITTEE
Senator Noreen Evans, Chair
2011-2012 Regular Session
SB 837 (Blakeslee)
As Introduced
Hearing Date: April 5, 2011
Fiscal: No
Urgency: No
BCP:rm
SUBJECT
Residential Real Property: Disclosures
DESCRIPTION
Existing law requires specified single-family residences to be
equipped with water-conserving plumbing features on or before
January 1, 2017, and requires the owners of those residences to
replace noncompliant fixtures as part of an alteration or
improvement, as specified, that occurs on or after January 1,
2014.
This bill would inform prospective purchasers of residential
property of the above requirements by requiring disclosure of
"water-conserving plumbing fixtures" in the statutorily required
transfer disclosure statement.
BACKGROUND
SB 407 (Padilla, Chapter 587, Statutes of 2009) established
requirements for the replacement of non-water conserving
plumbing fixtures in specified properties built on or before
January 1, 1994. For single-family residential properties, SB
407 imposed a requirement that noncompliant fixtures be replaced
with water conserving fixtures on or before January 1, 2017. On
or after that date, sellers of those properties must disclose
both the requirement to replace noncompliant fixtures and
whether the property includes any noncompliant fixtures.
In order to provide buyers of residential real property with
pertinent information about a subject property, existing law
requires sellers to disclosure various details about the
(more)
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property on a transfer disclosure statement (TDS). This bill
would facilitate notification of the above requirements by
amending the TDS to also include disclosure about whether the
residence has any "water-conserving plumbing fixtures." A
similar provision was included in SB 407, but was removed in the
final set of Assembly Floor amendments.
CHANGES TO EXISTING LAW
Existing law requires the transferor of real property,
consisting of one to four dwelling units, to provide a statutory
transfer disclosure statement as soon as practicable before
transfer of title. (Civ. Code Sec. 1102.3(a).) In the case of
a sale or lease with an option to purchase, transferors of a
manufactured or mobilehome must provide the TDS as soon as
practicable before the close of escrow. (Civ. Code Sec.
1102.3a.)
Existing law codifies the form and content of the TDS, which
includes numerous disclosures, including whether the seller is
aware of any significant defects/malfunctions in specified
components of the home. (Civ. Code Sec. 1102.6.)
Existing law requires noncompliant plumbing fixtures in any
single-family residential real property to be replaced by the
property owner with water-conserving plumbing fixtures on or
before January 1, 2017. On and after January 1, 2017, a seller
or transferor of single-family residential real property shall
disclose those requirements, in writing, to the prospective
purchaser or transferee, and whether the real property includes
any noncompliant plumbing fixtures. (Civ. Code Sec. 1101.4.)
Existing law provides that, on or after January 1, 2014, for all
building alterations or improvements to single-family
residential real property, an applicant for a permit shall
replace all noncompliant plumbing fixtures with water-conserving
plumbing fixtures. (Civ. Code Sec. 1101.4(a).)
Existing law limits the application of the above provisions
relating to water-conserving plumbing fixtures to residential
and commercial real property built and available for use on or
before January 1, 1994. (Civ. Code Sec. 1101.2.)
Existing law defines noncompliant plumbing fixtures as any of
the following:
Any toilet manufactured to use more than 1.6 gallons of
water per flush;
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Any urinal manufactured to use more than one gallon of
water per flush;
Any showerhead manufactured to have a flow capacity of
more than 2.5 gallons of water per minute; or
Any interior faucet that emits more than 2.2 gallons of
water per minute.
(Civ. Code Sec. 1101.3(c).)
Existing law defines "water-conserving plumbing fixture" as any
fixture that is in compliance with current building standards
applicable to a newly constructed real property of the same
type. (Civ. Code Sec. 1101.3(e).)
This bill would add disclosure of "water-conserving plumbing
features" to the TDS and add a statement to the TDS that:
"Section 1101.4 of the Civil Code requires all California
residences to be equipped with water-conserving plumbing
fixtures after January 1, 2017. Additionally, on and after
January 1, 2014, a California residence that is altered or
improved will be required to be equipped with water-conserving
plumbing fixtures as a condition of final approval. Fixtures in
this dwelling may not comply with Section 1101.4 of the Civil
Code."
COMMENT
1. Stated need for the bill
According to the author, SB 837 would add language that is
necessary to implement SB 407 to the transfer disclosure
statement. The author states that:
SB 407 (Padilla) originally contained this bill language but
when there was difficulty reconciling this language with
other pending amendments to the Transfer Disclosure
Statement, this language was dropped to accommodate the
addition of a disclosure for carbon monoxide detectors.
2. SB 407 disclosures and the TDS
As noted above, SB 407 required owners of single-family
residential homes to replace noncompliant plumbing fixtures with
water-conserving fixtures by January 1, 2017, and required
noncompliant fixtures to be replaced as part of an alteration or
improvement occurring after January 1, 2014. Those requirements
apply to homes built on or before January 1, 1994 due, in part,
to national standards for water-saving plumbing that apply to
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homes built after that date. To inform prospective buyers of an
owner's compliance with SB 407's requirements, that bill
required the seller or transferor of a single-family residential
property to disclose that the owner is required to replace
noncompliant plumbing fixtures, and to state whether the
property contains any noncompliant fixtures. That disclosure
will be required of all sellers as of January 1, 2017.
This bill would further inform potential purchasers about the
requirements of SB 407 by modifying the statutory transfer
disclosure statement to also include: (1) disclosure of whether
the property contains water-conserving plumbing features; and
(2) a statement that "all California residences" must be
equipped with water-conserving plumbing features after January
1, 2017, that residences altered after January 1, 2014 must be
equipped with those fixtures as a condition of final approval,
and, that the fixtures in the dwelling may not comply with those
requirements. Although the changes to the TDS would take effect
before the requirements of SB 407 apply, they could provide
valuable information for prospective purchasers about future
upgrades that may need to be done to their home. While this bill
requires information about water-conserving plumbing fixtures to
be included in the TDS even when the property is not subject to
SB 407's requirements (for example, built after January 1,
1994), the information provided about the water-conserving
plumbing features within the home could still be helpful to a
water conscious purchaser.
Staff notes that adding disclosure to the TDS was contemplated
when this Committee approved SB 407; the analysis specifically
stated: "Instead of requiring a separate disclosure (the
certification) for residential property with one to four units,
the author has agreed to work with Committee staff to
incorporate that disclosure into the TDS." Although SB 407
incorporated a disclosure into the TDS, that provision was
stricken by Assembly Floor amendments after difficulties arose
in reconciling the change proposed by SB 407 and a proposed
change to the TDS by another bill.
3. Scope of disclosure broader than requirements of SB 407
Although the proposed disclosure would inform potential buyers
of the requirements of SB 407, including whether their
prospective home already contains water-conserving plumbing
fixtures, the proposed TDS disclosure language (referring to
"all California residences") is broader than the scope of SB
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407. There are two components to the difference in scope: (1)
type of property (single vs. multi-family); and (2) year the
home was built. Both of those discrepancies can be addressed
through the clarifying amendment suggested in Comment 3(b).
a. Type of property
SB 407 imposed different requirements on single-family
residential real property and multifamily real property:
Owners of single-family real property (defined as not more
than one unit) must replace noncompliant plumbing fixtures by
January 1, 2017, and, on or after January 1, 2014 any
alterations or improvements must include replacement of
noncompliant fixtures, as specified. On the other hand, owners
of multifamily properties (more than one unit) must replace
all noncompliant plumbing fixtures by January 1, 2019.
While the TDS disclosure language added by this bill could
accurately inform some potential purchasers of the
requirements of SB 407 as it relates to single-family homes
(see Comment 2(b)), the TDS itself must be provided to
purchasers of residential real property with one to four
units. Since the requirements under SB 407 are different for
a property with one unit (single-family), and four units
(multi-family), the proposed TDS disclosure, which only notes
the January 1, 2014 and January 1, 2017 requirements for
single family properties, could mislead purchasers of
multifamily properties who receive a TDS.
The root of the problem is that the TDS is given to a broader
range of properties than SB 407's definition of "single-family
residential property." Given the two divergent definitions,
the simplest way to provide disclosure without modifying the
scope of those statutes, or creating a separate TDS for single
family residential properties, is to clarify the proposed
disclosure language to ensure that the potential buyer is not
mislead. (See suggested clarifying amendment in Comment
3(b).)
b. Year property was built
Similar to the above issue regarding the definition of
single-family residential property, the scope of SB 407 was
also limited to residential and commercial real property built
and available for use on or before January 1, 1994. (Civ.
Code Sec. 1101.2.) As the proposed TDS language would not
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inform potential purchasers about the January 1, 1994 cutoff
date, it could confuse sellers and purchasers as to the actual
requirements of California law.
To address the above issues, the following language is
suggested to clarify the proposed TDS disclosure:
Suggested clarifying amendment:
On the bottom of page 3, strike out "Section 1101.4 of the
Civil Code requires all California residences to be equipped
with water-conserving plumbing fixtures after January 1, 2017.
Additionally, on and after January 1, 2014, a California
residence that is altered or improved will be required to be
equipped with water-conserving plumbing fixtures as a
condition of final approval." and insert:
Section 1101.4 of the Civil Code requires a single-family
residence built on or before January 1, 1994 to be
equipped with water-conserving plumbing fixtures as of
January 1, 2017. Additionally, on and after January 1,
2014, a single-family residence, built on or before
January 1, 1994, that is altered or improved is required
to be equipped with water-conserving plumbing fixtures as
a condition of final approval.
Support : None Known
Opposition : None Known
HISTORY
Source : California Association of Realtors
Related Pending Legislation : None Known
Prior Legislation : SB 407, see Background.
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