Info from the Condo Guru

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From time to time, I like to check out the website of Beth Grimm, the "California Condo Guru". There are many HOA law firms that put out newsletters on matters that might interest HOA board members and residents, but I think Beth is one of the better writers. She covers important topics in clear language that most of us can understand.

I just caught up on the past few months' worth of articles, and there are some good ones to share with you:

• Earthquake Country

• How Should an Architectural Review "Appeals" Process Work?

• Setting the Record Straight on Homeowner Forum"

• Parking in the Garage, What is So Misunderstood About That?

Clearly this is not one-stop shopping for all you need to know about community association living, and there are many different perspectives on the topics. But it's a good way to get familiar with some important topics, the associated issues, and how others have handled them.

I wasn't at the board meeting last week, but some of the reports I heard about open forum are prompting me to share my own understanding of the law with readers: Each member of the association has a right to address the board for a reasonable amount of time in each open meeting. The board is not under an obligation to engage in dialogue with you, especially if the topic you are speaking on is not covered by the agenda. But you have the right to speak on a topic whether or not it will be covered in a future meeting, and you have the right to do it, uninterrupted. I believe the general period the board has used is 3 minutes. An agenda is a tool for guiding the meeting but shouldn't provide hard stops if people wish to speak in a respectful manner.

As I've said before, I think a good way to communicate opinions is to inform the board in writing first so they are prepared, but sometimes the forum is the only opportunity residents have to speak up and hear the opinions of others. You and the board should understand what you as homeowners are entitled to - but also realize that the meeting does not provide a limitless soapbox for people to talk with the board throughout the meeting. Once open forum is over, members in the audience become spectators unless requested to speak by the board.

New Year, New Laws

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It's an invisible occurrence, but may be one of the most important ones affecting us in the coming year at Seabridge and elsewhere. When the clock strikes 12 on New Year's Eve, not only will the party horns be tooting, but a set of new laws will take effect in California.

Of these, the one I believe will be most obvious and important to us Seabridge homeowners is the change to the law resulting from the passage of Senate Bill 528. With a few exceptions, this law requires that the board post meeting agendas in advance and keep decisions limited to the topics on the agenda. If you don't like decisions that have been made in the past, there is virtually no reason left for you to be surprised by a board decision you don't like. So keep an eye out for agendas and make sure you keep informed on the issues affecting our community. And share your views with the board.

If you're curious about the other laws lurking just around the bend, the San Jose Mercury Tribune does a decent job at listing some of them. Of the ones they mention, I was happy to read about the changes to acceptance of gift certificates. California has always been good about looking out for the consumer in the area of gift cards and certificates - including our state's unique law about not allowing cards bought in the state to expire. Also, I see that the hands-free-cellphone-use-while-driving doesn't take effect until July. Still, I believe it's good practice now.

Community Association Law isn't the most fascinating topic, but it has a big impact on how our association runs and how our money is spent. If you're in doubt, consider the numerous organizations - including realtors, management companies, homeowners and contractors - taking positions on all sides of pending legislation, and the lobbyists they send to Sacramento to look out for the millions of dollars they have at stake. I think it's worth an hour or two to understand the basics of the Davis-Stirling Act that guides much of the association's operation. Also, the shiny new 2008 California Condo Bluebook is always an excellent guide. If you are curious about other legislation being considered, there is a good summary of what came up in 2007 here and especially here. Of the information, I was intrigued by the legislation our own Senator, Tom Harman has proposed. It would require mandatory education for board members. I can see the arguments that this is an intrusion into the affairs of the association, but I also understand the intent of making sure people running and HOA understand the basic concepts. Ideally all board members would get this education voluntarily as a part of making sure they understand how to best live up to their fiduciary duty.

"Enjoy"!

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Deep Thoughts from the Guru

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As I mentioned in the earlier post, it had been a while since I checked the website of the California Condo Guru, Beth Grimm, so I thought I'd pay it a visit. There were some interesting updates, and below I'll share with you some of the ones I found to be most interesting.

Earthquake Insurance - What are some of the things we should be thinking about? What risks are we willing to take on? What risks are we putting on our neighbors? This is an interesting perspective on the topic.

Additional Perspective on Earthquake Insurance - some additional considerations on the subject

Homeowner Conduct - It's all too easy to focus on what the board does, but sometimes it's helpful to think about how we homeowners conduct ourselves. Even if we don't engage in such behavior ourselves, we might know of someone who does.

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New Law Affecting Board Meetings

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It's been a while since I've written about the California Condo Guru, but I'll have to remember to check her work more often. It's always insightful and relevant.

For example, I recently came across a post from August entitled "Should Agendas Be Required With Meeting Notices?". It discussed a bill pending in the State Legislature that requires boards of HOAs to post agendas prior to meetings, and to only discuss items on the agenda. I've long been an advocate of getting meeting topics out to people in advance, so that homeowners can know what the board plans to discuss, and they can share their opinions on those topics in open forum. How can the board hear from homeowners on projects like entry gate upgrades if homeowners don't know prior to a meeting that this topic will be acted on? Nonetheless, I was still a bit surprised when I went to check on the status of the bill and found it had been signed into law by the governor on September 26th.

So, it will be interesting to see how our board and management company handle the requirement, and where the agenda will be posted. There is the community bulletin board in the pool area, but I would love to see it available on-line, via the association's website.

This also provides me with the opportunity to remind you that there is a board meeting tomorrow, October 16th at 7PM in the Clubhouse. As I understand it, the law is already in effect, so it will be interesting to see how it's followed. I do recognize that it's less than a month old and often difficult to keep on top of every new requirement.

UPDATE 10/17/07: - I was once again impressed with Morgen Hardigree, who was aware of this bill's passing and explained that it would be taking effect 1/1/08. (I still have not seen any dates in the bill, so if someone out there understands the process and can explain how we know when it takes effect, enlighten me!) I am also pleased to report that the board president and management supported making agendas and minutes available to homeowners via the website. That was really the key thing for me, as it's important that you understand what work the board is doing on your behalf, and that you have a chance to participate in a meaningful way.

UPDATED 10/20/07: - The California Legislative Information website explains that most bills that are signed into law take effect January of the following year. Only urgency bills and certain other measures take effect immediately. Still, I hope that the board gets an early start on the spirit of the measure.

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Pearls Of Wisdom

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One of our neighbors shared these Pearls of Wisdom from CAI, the Community Associations Institute. CAI puts out some pretty good educational material for homeowners associations, and I think this is right in line with their other stuff.

You may read it and think they are obvious - but it's amazing how many people live in HOAs - or lead HOAs - and have little awareness of these. I think it's well worth a read.

Among my favorites...

• 1. Review the covenants, conditions and restrictions
  (CC&Rs) and other association documents before you buy a home.

• 2. Read them again when you move in. It's amazing to me how we can all manage to remember just our favorite ones. Or think that we never agreed to abide by them.

• 6. Follow the rules.

• 7. Serve on a committee.

• 8. Serve on the board or, at a minimum, attend board meetings.

• 9. Don’t expect someone else to do it for you. Amen.

• 28. Use CAI courses and information to learn how to run a community association and work most effectively with others in your community.

• 29. Study the documents before you enforce them.

• 123. Conduct surveys to gauge community opinion and solicit input.

How about you? Which ones resonate with you? Share your thoughts in the Comments...

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Math Class

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On Rewriting Our CC&Rs

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Introducing the Condo Guru

"CID", "Davis-Stirling", "PUD", "fiduciary duty" - there are enough terms floating around association living to make one's head spin! But as I've said before, they affect us whether we pay attention or not. So it's good for all homeowners to have at least a familiarity with the current issues surrounding community association living.

But it's a confusing world to navigate - how do you go about it? I was recently reminded of a great resource I discovered when I served on the board: the California Condo Guru. Beth Grimm, an attorney in Northern California set up this website and does an excellent job of serving up relevant information in Plain English. There are many other HOA law firms in California that provide legal updates and newsletter, but I found Beth's site to be most helpful to the average homeowner.

I now see that Beth is also providing information on her own blog, and I find this feature to be extremely helpful. Topics she has recently covered include:

• Homeowners planting flowers in the common area
• Earthquake Insurance - Drop It or Keep It?
• Reserves and "Healthy" Financial Planning

Each article only takes a few minutes to read, yet provides a good background on topics that our association often deals with. The board should always consult with its own experts when needed, but at a minimum, the information provided helps homeowners and board members set out in the right direction to learn more and make the right decisions for the community.

Let me know if you find her blog helpful. I'll try to remember to link to specific posts of hers if I read any that are especially relevant to us.

In the Spotlight: Meeting and Notice Requirements

From time to time, I intend to focus on some aspect of Common Interest Development living that might interest Seabridge homeowners. When I was on the board, I found the Condominium Bluebook, published by Piedmont Press, to be extremely useful. If each current board member doesn't have a copy, I highly recommend it. And while I will use this space to highlight important items from it, I would also recommend the book to any homeowner. This column is no substitute for the wealth of knowledge that this book keeps collected, current, and organized. Both the board and the homeowners have responsibilities to ensure that the community runs well. For many laws affecting our community, you can also go straight to the source: sections of the California Civil Code, also known as the Davis-Stirling Act. Many of these points are from section 1363.05.

There are several kinds of meetings that occur here at Seabridge. Every June, we have a membership meeting. That's when each of us as homeowners have the opportunity to vote on matters, including the election of board members and the determination on what to do with excess operating funds.

The rest of the year, most meetings consist of regular meetings of the board of directors. While these are open to the homeowners, we do not have the opportunity to vote since these are not meetings of the membership, just the board of directors. We do, however, have the opportunity to speak in open forum.

The board is also allowed to take certain discussions into executive session. By law, the discussion that may take place is limited to consideration of litigation, matters related to the formation of contracts with third parties, member discipline, personnel matters, or to meet with a member subject to discipline, if the member requests it. The matters discussed must be generally noted in the minutes of next meeting open to homeowners following that session.

Meetings of the board are required to be announced to homeowners 4 days prior to the meeting. The notice should be posted in a prominent place or places in the common area. In the past, a posting on the clubhouse has been common. Seabridge Board meetings occur on the third Tuesday of each month at 7PM, and that has been announced regularly in the newsletter distributed to all residents. I'm no lawyer, but I suspect that this adequately announces those meetings. It never, hurts, however, to over-communicate, and perhaps the board can also employ the website.

Did you Know? Civil Code 1363.05(g) says that "...Notice shall be given by posting the notice in a prominent place or places within the common area and by mail to any owner who had requested notification of board meeting by mail, at the address requested by the owner." The last part certainly seems aimed at reducing confusion as to when meetings take place, and I think I'll request it myself.

Emergency meetings may be called if there are circumstances that could not have been reasonably foreseen which require immediate attention and possible action by the board, and which make it impracticable to provide notice.

Each type of meeting has its purpose and will be appropriate for certain situations. I believe that the test for what should not be covered in a regular board meeting should not be made loosely. That may lead to a longer meeting - believe me, I know from experience! - but also leads to the most trust in the board and its actions.

As with any other posting on the site, the information provided only reflects my understanding. The best thing to do is go straight to the source and learn for yourself! I hope this has helped you get started.