BILL ANALYSIS �
AB 2565
Page 1
Date of Hearing: April 30, 2014
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Ed Chau, Chair
AB 2565 (Muratsuchi) - As Amended: April 21, 2014
SUBJECT : Rental property: electronic vehicle charging
stations.
SUMMARY : Makes a term in a lease, contract, security
instrument, or other instrument affecting the lease of a
commercial or residential property void and unenforceable if it
prohibits or unreasonably restricts the installation of an
electric vehicle (EV) charging station in a lessee's designated
parking space. Specifically, this bill :
1)Makes a term in a lease, contract, security instrument, or
other instrument affecting the lease of a commercial or
residential property void and unenforceable if it prohibits or
unreasonably restricts the installation of an electric vehicle
charging station in a lessee's designated parking space
including but not limited to:
a) An assigned parking space,
b) A parking space in a common area; and
c) A parking space that is specifically designated for use
by a particular lessee.
1)Defines "electric vehicle charging station" or charging
station" to mean a station that is designed in compliance with
the California Building Standards Code and delivers
electricity from a source outside an electric vehicle into one
or more electric vehicles.
2)Defines "reasonable restrictions" or "reasonable standards" as
restrictions or standards that do not significantly increase
the cost of the electric vehicle charging station, its
installation, or significantly decrease the charging station's
efficiency or performance.
3)Requires an EV station to meet appropriate state and local
health and safety standards and requirements, and all
applicable zoning, land use, or other ordinances or land use
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permit requirements.
4)Provides that if the approval of the landlord is required for
installation of an EV charging station the application must be
processed and approved in the same manner as an application
for approval of a lessee modification to the property and must
not be willfully avoided or delayed.
5)Requires the written approval or denial of a lessee's
application to install an EV charging.
6)Provides that if the application is not denied within 60 days
then the application is deemed approved unless the delay is
the result of a reasonable request for additional information.
7)Provides that if the lessor approval is required and obtained
by the lessee, the lessor shall approve the installation if
the lessee agrees to the following in writing:
a) Comply with the lessor's reasonable standards for the
installation of the charging station;
b) Engage a licensed contractor to install the charging
station;
c) Within 14 days of approval provide a certificate of
insurance for $1,000,000 that names the lessor as an
additional insured; and
d) Pay for the electricity usage associated with the
charging station.
1)Requires that the lessee is responsible for the following:
a) Costs for damage to property and the charging station
resulting from the installation, maintenance, repair,
removal, or replacement of the charging station;
b) Costs for maintenance, repair, and replacement of the
charging station; and
c) The cost of electricity associated with the charging
station.
1)Requires the lessor to authorize installation of a charging
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station, for the exclusive use of the lessee, in a common area
that is not an exclusive use common area, if the lessee's
designated parking space is impossible or unreasonably
expensive to install a charging station and the lessee
satisfies all the requirements above for installing the
charging station.
2)Requires the lessor to enter into a licensing agreement with
the lessee if a charging station is installed in a common area
that is not an exclusive use common area for the exclusive use
of the lessee.
3)Allows the lessee or the lessor to install an EV charging
station in the common area for the use of all the lessees of
the lessor in which case the lessor must establish appropriate
terms for the charging station.
4)Allows the lessor to create a new parking space where one did
not previously exist to facilitate the installation of the EV
charging station.
5)Provides that a lessor that willfully violates this Act is
liable to the lessee applying for the EV charging station for
actual damages, and must pay a civil penalty to the lessee in
an amount not to exceed $1,000.
6)Provides the prevailing party in an action to enforce the
provisions of this Act shall be awarded reasonable attorney's
fees.
EXISTING LAW :
1)Provides it is the policy of the state to promote and
encourage the use of solar energy systems and to remove
obstacles to their installation. Finds that reasonable
restrictions on solar energy systems are those restrictions
that do no significantly increase the cost of the system or
significantly decrease efficiency (Civil Code Section 714).
2)Makes void and unenforceable any covenant, restriction or
conditions contained in any deed, contract, security
instrument, or other instrument in a common interest
development (CID) that prohibits or restricts the installation
of an EV charging station.
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3)Defines "reasonable restrictions" as those that do not
significantly increase the cost of the EV charging station or
decrease its efficiency or performance.
4)Requires EV charging stations installed in CIDs to meet
applicable health and safety standards and requirements
imposed by state and local permitting authorities.
5)Requires a homeowners association (HOA) to process and approve
a request to install an EV charging station in the same manner
as an architectural modification to the property and to not
willfully delay or avoid approval.
6)Requires the approval or denial of an EV charging station in a
CID to be in writing.
7)Provides that if an application is not denied within 60 days
by a CID from the date it receives the application it will be
deemed approved unless the delay was a result of a reasonable
request for additional information.
8)Provides that if an EV charging station is to be placed in the
common area of a CID or an exclusive use common area, the
owner must obtain approval to install the EV charging station.
9)Provides that if an EV charging station is to be placed in the
common area or an exclusive use common area of a CID, the
homeowner must agree in writing to all the following:
a) comply with the architectural standards for
installation;
b) engage a licensed contractor to install the station;
c) within 14 days of approval provide a certification
of insurance that names the HOA as an additional insurer
under the homeowner's insurance policy; and,
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 EV charging station is placed is responsible
for all of the following:
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a) cost for any damage to the station, common areas,
exclusive common areas, or adjacent units resulting from
the installation, maintenance, repair, removal or
replacement of the station;
b) cost for the maintenance, removal, repair and
replacement of the electric vehicle charging station
until it has been removed from the common area or
exclusive use common area;
c) the cost of electricity associated with the station;
and,
d) disclosing to prospective buyers the existence of
any electric vehicle charging station and the related
responsibilities of the homeowner.
1) Requires any homeowner and each successive homeowner to
maintain an umbrella liability coverage policy for $1
million and name the HOA as an additional insured under the
policy with a right to notice of cancellation.
2) Provides that an HOA that willfully violates this
section is liable for actual damages and shall pay a civil
penalty to the applicant in an amount not to exceed $1000.
(Civil Code Section 4745
et.al)
FISCAL EFFECT : None.
COMMENTS :
Background:
According to a 2012 study completed by the California Center for
Sustainable Energy in coordination with the California Air
Resources Board (ARB), Californians own more than 12,000 plug-in
electric vehicles, roughly 35% of all plug-in vehicles in the
United States. Approximately 1,000 new plug-in vehicles are
being sold in the state every month.
In 2012, the Governor issued an Executive Order (EO) directing
ARB, the California Energy Commission, the Public Utilities
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Commission, and other relevant agencies working with the Plug-in
Electric Vehicle Collaboration and the Fuel Cell Partnership to
develop benchmarks to help support and facilitate the rapid
commercialization of zero-emission vehicles. The order directed
these agencies to establish benchmarks to help the state's
zero-emission vehicle infrastructure support 1.5 million
electric vehicles by 2025. In furtherance of this goal, the
Office of Planning and Research and the State Architect
published guidelines to address physical accessibility standards
and design guidelines for the installation of plug-in electric
vehicle charging stations throughout California. These
guidelines are voluntary and apply to public and private sites
and eventually could become regulations within California
Building Code Chapter 11B: Accessibility to Public Buildings,
Public Accommodations, Commercial Buildings and Public Housing.
Last year, AB 1092 (Levine) ( 2012) Chapter 410, required the
California Building Standards Commission (CBSC) to adopt
mandatory standards for the installation of electric vehicle
charging infrastructure for parking spaces in newly constructed
multifamily dwellings and nonresidential development in the next
triennial edition of the California Building Standards Code
(Title 24 of the California Code of Regulations). The first
drafts of these guidelines were recently released and are
expected to be adopted in 2015.
SB 209 (Corbett), Chaptered 121, Statutes of 2011, prohibited
the governing documents of an association from denying or
restricting the installation of an EV charging station by an
owner in a CID. The bill specified conditions for the
installation of an EV charging station in the common area of a
CID. AB 2565 is modeled after AB 209 (Corbett) but it applies
to rental commercial or residential properties. AB 209
prohibited an HOA from unreasonably restricting an owner's right
to install an EV charging station. Whereas in a CID the members
have a shared ownership of the common space in a commercial or
residential tenant has no ownership of the common space.
Purpose of the bill : According to the author, "in order to
address the lack of EV infrastructure, AB 2565 seeks to remove
an impediment to EV charging station installation. Property
owners may refuse to allow the installation of a charging
station even if the tenant is willing to pay for the
installation and operation of the station. AB 2565 would remove
this impediment by stating that a property owner cannot deny a
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tenant the ability to install a charging station if the tenant
is willing to pay for all expenses related to the installation
and operation of the station."
Arguments in support: According to ChargePoint, the sponsor of
the bill, EV charging infrastructure is not keeping up with
electric vehicle adoption. In 2013, there were 75,000 EVs
registered in California and 7,542 charging ports for a ratio of
nearly 10 vehicles for every port causing congestion to charging
stations. The sponsor states that individual businesses have
realized the financial and environmental incentive of offering
EV charging. By offering EV charging, an employer can give
employees the equivalent of a 5% raise through reduced fuel and
maintenance costs and time saved through HOV lane access.
Further, 41% of California residents live in multi-family
housing. The sponsor contends that without the ability to charge
at home, Californians are unlikely to purchase electric vehicles
and therefore do not get the benefits which include saving
thousands on gas and maintenance costs and helping the
environment.
Arguments in opposition: Opponents of AB 2565 have both broad
policy as well as operational concerns with the bill. According
to opponents, "AB 2565 uses the language from SB 209 (Corbett)
in an attempt to give a lessee of a commercial or residential
property the ability to install an EV charging station. However,
SB 209 was written to assure that homeowners (property owners)
would be able to install EV charging stations at their residence
over any "unreasonable" objections made by the HOA. This makes
sense: a homeowner should be able to make this decision for
their property. But simply transferring the language to
commercial and residential rental environment creates a
significant change in that it reverses the roles and gives the
power to the party that does not own the property." In
addition, the opponents have concerns with the bill's use of the
term "unreasonable" to judge as to whether or not a property
owner is in compliance with its provisions. "Even though the
bill's intent is to include all costs of installing and
maintaining an EV charger we are not sure that a future
interpretation of the unreasonable standard would actually
include all costs."
Policy issues to be considered :
1)Installing an EV charging station could involve ripping up
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concrete that may be part of the travel path for other tenants
and could create Americans with Disability Act (ADA) issues.
This would create liability for the owner and may require
coordination outside of the tenant's control. It may be more
appropriate to have the owner of the property control the
installation of the infrastructure to support the EV charging
station.
2)The bill requires the lessee to comply with a lessor's
reasonable restrictions and standards for installing an EV
charging station. Reasonable restrictions and standards are
defined as restrictions or standards that do not significantly
increase the cost of the EV charging station or installation
or significantly decrease the charging station's efficacy or
performance. There is going to be a lack of uniformity in
application throughout the state and even within an individual
jurisdiction on what is a reasonable restriction. A charging
station that is functional may cost significantly less than
one that is both functional and esthetically pleasing. Beyond
just the need to agree to a standard, if a landlord and tenant
disagree on the correct approach, and the landlord denies the
tenant's request to install, then the landlord may be seen as
unreasonable. If a landlord violates this standard they are
subject, to a $1,000 fine. The committee may wish to consider
if this is an appropriate standard.
3)How will the tenant be billed for the electricity for the
charging station? Will there need to be a process for master
metering?
4)What happens to the EV charging station if the tenant moves
out? Is the tenant responsible for taking the charging station
out? Who pays for the maintenance of the charging station once
a tenant moves out?
5)The committee may wish to consider if this bill will achieve
the goal of encouraging the use of electric vehicles or if the
demand for those vehicles is dependent more on price and
availability rather than access to EV charging stations.
Committee amendments:
The committee may wish to consider the following amendments:
1.Make clear that the provisions of this bill apply only to new
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leases.
2.Give the lessor the option to oversee the installation of the
infrastructure for an EV charging station unless they choose
to give that authority to the lessee.
Double referred : The Assembly Committee on Rules referred AB
2565 to the Committees on Housing and Community Development and
Judiciary. If AB 2565 passes this committee, the bill must be
referred to the Committee on Judiciary.
REGISTERED SUPPORT / OPPOSITION :
Support
ChargePoint
Opposition
California Business Properties Association
Building Owners and Managers Association of California
California Apartment Association
California Building Industry Association
California Chamber of Commerce
California Grocers Association
California Retailers Association
Analysis Prepared by : Lisa Engel / H. & C.D. / (916) 319-2085