ECHO Journal - October 2013

Small Association – The Big Picture – Compliance - PT 2 p.8

Strategic Planning for Board Members p.16

Twenty Questions To Ask Before Hiring a Construction Manager p.22

Oh No, Not in My Neighbor’s Backyard!

p.26

Questions to Ask Your Banker p.30

October 2013

Serving Community Associations

echo-ca.org

Small Association The Big Picture Compliance Part 2 p.8

ECHO 1602 The Alameda STE 101 San Jose, CA 95126 Change Service Requested

PRSRT STD U.S. Postage PAID Modern Litho 210

CONTENTS

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Small Association – The Big Picture – Compliance – Part 2 In Part I, you learned about Mini Courts HOA and the many problems that arose when the long time self-appointed manager got ill and handed over files without much instruction. In Part 2, learn about the myriad rules governing the care and management of your homeowners association, and what every board member needs to know.

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Strategic Planning for Board Members

Most successful businesses have embraced the concept of strategic planning and the results attained drive the direction, resources, and decisions made in the daily course of doing business. Learn about the many benefits that your community will experience when the board is guided by a strategic plan.

Twenty Questions To Ask Before Hiring a Construction Manager

Prior to retaining a construction manager or consultant, you should satisfy yourself that the firm you are considering is the best for your project. To help in making up that decision interview each candidate using the following 20 questions as a guide. Their answers to these questions will assist you choosing the individual or firm that best meets your needs.

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Oh No, Not in My Neighbor’s Backyard!

Architectural review is serious business for an association board.

One of the important attributes of any type of planned unit development is its high standard for uniform construction, design and aesthetics. As an association board, you play a vital role in enforcing and maintaining these standards, often with the help of an architectural committee.

Questions to Ask Your Banker

The selection of a banking relationship for your association is important. The best option is a bank that is familiar with the HOA industry at a minimum and preferably one that has a specialized department or staff who understands your needs.

The ECHO Journal is published monthly by the Educational Community for Homeowners. The views of authors expressed in the articles herein do not necessarily reflect the views of ECHO. We assume no responsibility for the statements and opinions advanced by the contributors to the magazine. It is released with the understanding that the publisher is not engaged in rendering legal, accounting or other professional service.

If legal advice or other expert assistance is required, the services of a competent professional should be sought.

Acceptance of advertising does not constitute any endorsement or recommendation, expressed or implied, of the advertiser or any goods or services offered. We reserve the right to reject any advertising copy.

Copyright 2013 Educational Community for Homeowners. All rights reserved. Reproduction, except by written permission of ECHO is prohibited.

The ECHO membership list is never released to any outside individual or organization.

ECHO 1602 The Alameda, Suite 101 San Jose, CA 95126 408-297-3246 Fax: 408-297-3517 www.echo-ca.org info@echo-ca.org Office Hours Monday-Friday 9:00am to 5:00pm Board of Directors and Officers President David Hughes Vice President Karl Lofthouse Treasurer Diane Rossi Secretary Jennifer Allivato

DEPARTMENTS

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News from ECHO

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ECHO Sacramento Educational Seminar — November 16th

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ECHO Bookstore

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Advertiser Index

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ECHO Event Calendar

40

ECHO Volunteers

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Legislation at a Glimpse

Directors Jerry L. Bowles Stephanie Hayes Robert Rosenberg Brian Seifert Steven Weil

John Garvic David Levy Kurtis Shenefiel Wanden Treanor

Executive Director Brian Kidney Director of Marketing & Membership Jennifer Allivato Director of Communications Tyler Coffin Legislative Consultant Government Strategies, Inc. Design and Production Design Site ECHO Mission Statement Serving Community Associations

October 2013 | ECHO Journal 5

news from ECHO

News From ECHO October 2013 Fall is upon us, and with it an opportunity to prepare for the New Year, which means planning and budgets. The better your preparation, the fewer surprises there will be during implementation.

Here is what you can find to help you in this edition of the ECHO Journal. Part 2 of the “Small Association” article series addresses the nuts and bolts of operating your association in compliance with the law. “Strategic Planning” focuses on the important ways and means to work together as a Board on your key responsibilities. “Twenty Questions” helps you ensure your construction manager is qualified to make the most of your association’s construction dollars. “Not in My Neighbor’s Backyard” addresses how your association should approach architectural and landscape issues. And, “Questions to Ask Your Banker” will give you the tools so your association gets the best banking services available.

I want to congratulate Michael Kennedy, the 2013 ECHO Volunteer of the Year.

Michael is President of First Bank Association Services and has been an ardent supporter of ECHO for over 30 years. Often described as the “father of association banking”, Michael understands the unique relationship between an association and its bank. He has been a member of ECHO’s Banking and East Bay Resource Panels and has never failed to support an ECHO event. Thank you Michael.

Next, I want to let you know that our ECHO Sacramento Educational Seminar has been rescheduled to November 16. Details are available on the next page. This will be the last ECHO seminar of the year, which will gird you with the essentials you need to successfully manage your association.

Finally, please continue to visit our new website to get the information you need, when you need it, www.echo-ca.org. Every edition of the ECHO Journal since 2007 is available for review. In addition, you can look up the current and new Davis-Stirling statutes, along with our handy conversion table, so you know where the language from your favorite current version ends up in 2014. And it’s all keyword searchable.

Best, Brian Kidney

Executive Director

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D LE U TH ED 16 H C OV ES R ON T

Sacramento Educational Seminar Saturday, November 16th, 2013 8:30 AM to 12:30 PM

ADDRESS

AGENDA

Westin Hotel 4800 Riverside Blvd.

Sacramento, CA 95822

HOT TOPICS:

SPEAKERS:

The Business of Being an HOA

Ian Brown, CCAM

HOA Financials

William Erlanger, CPA Adam Haney, CPA

Price:

New Davis-Stirling

Deon Stein, Esq.

$59 $49 Members $69 $59 Nonmembers Prices go up after August 23!

Join us at our first-ever Sacramento Seminar and get expert legal guidance, financial tips, and more. The Sacramento Educational Seminar is the perfect opportunity to meet fellow board members, strengthen your community, and reduce your association’s liability.

Watch our website and the ECHO Journal for more speaker and topic announcements.

Sponsor

October 2013 | ECHO Journal

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Small Association –The Big Picture– Compliance –Part 2 Are You Slowly Sinking In The Sea Of California Compliance Requirements?

After Bailing, Get Your Coxswain and Crew in Place and Row — Pragmatically and Persistently.

By Beth Grimm, Esq.

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October 2013 | ECHO Journal 9

In

PART 1, you learned about Mini Courts HOA and the many problems that arose when the long time self-appointed manager got ill and handed over files without much instruction. The person who inherited the files had to bail quickly to stop the progression of problems. Now he becomes the coxswain, the person who steers the boat, provides motivation and encouragement to the crew, keeps the crew informed as to status and what is needed to reach the ultimate goal (which here is getting the association back in good standing and moving forward in the right direction). This person became the “coach”, and even if he had received “instructions” from the prior acting manager/director, he would have had to bring in a new crew and change direction to get the association back on course.

Besides the regulations for running the HOA itself, there are several disclosure requirements in selling and refinancing an HOA or Condo unit. These are in addition to the real estate “material disclosure” laws that already exist requiring answers to questions when listing or refinancing a property. The President of Mini Courts HOA found out about seller disclosure very shortly after inheriting the files, when an escrow “demand” found its way to him. A seller is entitled to ask the HOA to provide records directly to the escrow officer or agent of the buyer on behalf of the seller.

And the HOA is required by law to do this, within ten days, or risk monetary penalties for failure to do so and legal liability for providing incomplete or inaccurate information. The HOA can charge its costs to the owner, but has to do the work itself.

The Mini Courts HOA President and his wife had to learn a lot about basic operations very quickly just to keep the association afloat. For anyone reading this who thinks it might be better just to let the association sink (assuming the State will come in and take over), the bottom line is that an HOA without someone in charge is just like a ship without a captain. There are so many things that can go wrong. And each and every homeowner carries some individual accountability for all those mistakes. If an individual owner is unwilling to help row, he or she might be called upon to pay.

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Board Members/Directors: Board members and directors generally are interchangeable terms. These are the elected officials of the association, like in a “mini government”. HOA regulating documents generally have a process for meetings and elections of a board (consisting of Directors). Board members are generally volunteers, meaning they do not get paid for carrying out board business. Most sets of bylaws allow for reimbursement of expenses, but no pay.

Boards can usually hire management but of course there must be enough money to pay for any contract signed so sometimes increased assessments are needed to get professional help. Some

The bottom line is that an HOA without someone in charge is just like a ship without a captain. There are so many things that can go wrong.

boards simply divvy up the tasks and adopt a “dues waiver” (although the proper term is “assessment waiver”), or a payscale or prorated waivers based on tasks assigned. In the case of Mini Courts HOA one person served as a director and manager, with no clear separation of duties or powers. The trouble with the idea of accepting “pay” for running an HOA is that lay people and even attorneys that do not specialize in this arena often fail to fully understand the ramifications.

The amount of “pay” is rarely commensurate with the legal risks. It is important

to recognize that accepting pay as a director can diminish or eliminate legal protections otherwise afforded volunteers. California law offers some immunity from lawsuits and judgments for volunteer directors if certain minimum insurance coverage is obtained by the HOA. If a director is receiving pay and is not protected by a contract that requires insurance or indemnification (protection against lawsuits), the director can be sued directly for the acts of another, or omissions, such as those of the prior “managing” owner. This could have happened to the Mini Courts HOA “director/manager”. The point here is not to say a director can never get paid for services offered. However, it is important to note that an individual trying to do a service for little pay can end up to be a big target without protection.

The governing documents won’t support payment to directors unless amended properly by membership approval.

Any board that feels directors should be compensated and the legal liability risks are worth it should have a proper amendment to the CC&Rs drafted which would allow for an assessment waiver or compensation and then put it to a vote of the members. The amendment requirement should be stated in the Bylaws or CC&Rs, whichever document is being amended. If the members approve it, everyone has equal opportunity to run for the board and so it should be perceived as fair by the courts, if anyone challenges it. The reason it would probably require an amendment to existing regulatory documents is at least two-fold. First, in order to get California Bureau of Real Estate (BRE) approval, which is required for most associations in the state, the bylaws must prohibit compensation. The “model” calls for volunteers. And if payment of assessments is required, the CC&Rs will contain an “assessment obligation” that requires owners to pay a sum toward the costs of operation and maintenance.

That sum may be on an equal or square footage or other basis, and it is enforceable. So if a board member gets a “dues waiver” and does not pay assessments or only pays a portion of what is required, another owner could complain that they are not paying their required share. Without a properly member-approved amendment, there is

no exception to that legal responsibility for paying the assessment obligation.

There are lots of other things HOAs need to know about that would take several more articles to describe in detail:

Meetings: HOA and condo documents and California law require HOA meetings.

Meetings are divided into two categories, membership and board meetings. Board meetings are further defined into several categories: open, executive session, emergency and teleconference meetings.

In a nutshell, membership meetings are open to all owners. If a board wants to allow non-owners such as partners or spouses, significant others, tenants, etc., it can set policy specifying who else can attend.

Membership meetings (regular or special) are for the purpose of discussion and/or reporting on membership matters.

This commonly includes things like reporting on annual financials, review and approval of membership meeting minutes, membership forums, and celebration. The main purpose of the annual meeting usually includes director elections (see more below on elections). Sometimes motions are raised at membership meetings to allow those present to vote. And while voting at annual membership meetings has been phased out in many HOAs because of mail ballot elections laws, counting ballots at annual membership meetings is a common occurrence. Some HOAs use this opportunity to have socials or parties to encourage socialization among members, and to seek out new members willing to serve on the board or committees. Notice of annual meetings has to be provided to members in writing within some reasonable time period before the meeting. Look for the required timeline in the bylaws.

Regular Board meetings are for board business and allow member attendance but not participation in the business.

In order to get business done, boards have to stay on course, and the course be disrupted if members who attend interrupt the business to inject their thoughts and opinions. It is usually best if the board adopts a policy that allows members to address the board at a specific time before or after the meeting, often called the “homeowner forum�, rather than at times when the directors are discussing or voting on businessrelated action items or approving budgets or financials. California law allows members the opportunity to address the directors at board meetings, but it also allows the board to set reasonable controls like time (time of forum, time limits on speaking, and the like). Notice and an agenda have to be provided to members (various options are available) at least 4 days before the board meetings.

October 2013 | ECHO Journal 11

Special Board meetings are those usually called by the President or two board members (look at the HOA bylaws for parameters).

The purpose of special board meetings is to address matters that need attention between regular board meetings and typically involves a topic that might take more time than may be allotted at a regular board meeting. Owner notice requirements of a special board meeting and agenda are the same 4 day requirement as a regular board meeting but with one difference – the purpose of the meeting must be included on the notice.

Executive (closed) meetings are limited to certain topics that need more confidentiality to protect the interests of the association.

Executive session topics include formation of contracts (bidding and negotiation), personnel matters, litigation matters, and disciplinary action. Notice of executive session meetings needs to be given to owners but they cannot attend. Notice has to be posted or provided to owners at least 2 days before the meeting, so owners at least know when the board is meeting in executive session.

Emergency board meetings are those that require faster decisions on matters for which there is no time to wait and call a special board meeting.

There are no notice requirements for owners with regard to emergency meetings. And these are the only type of board meetings that may be conducted via email, in addition to other faceto-face and telephone conference call options. However, for an action to be valid which is decided at an email meeting, the directors have to come to unanimous approval. The emails reflect the meeting record.

Telephone conference call board meetings are legal and may be held, but there are some special requirements.

When necessary, board meetings can be held telephonically or a director can be allowed to “dial in”. Sometimes this is necessary to meet the quorum requirements for a board meeting. The notice requirements are the same as for regular and special board meetings.

However, arrangements do need to be 12 echo-ca.org

made for one board member, or someone designated by the board, to be present as near as possible to the association so that owners can be allowed to hear the directors and address the board in homeowner forum.

The following items in a nutshell represent other things a board has to know to do it’s job properly: Every year several financial disclosures have to be provided to owners. These include next year’s budget, assessment notice, a reserve study and funding plan to deal with maintenance and repair planning for buildings, HOA capital facilities, or roads that have to be maintained and HOA insurance policies.

Nothing gets the attention it needs when there is no active responsible board in place. And when things fall apart, the finger pointing begins.

Every year several policy disclosures have to be provided to owners. These include information on sending notices to the association, dispute resolution processes, architectural control processes, fines and enforcement, collections including lien and foreclosure, and others.

Upon every escrow demand the board has to provide certain documents and disclosures to the escrow officer. The disclosures include financial and policy documents provided to owners annually, reporting on the status of construction defects lawsuit proceeds if any,

information on discriminatory clauses and/or lease limitation restrictions in the governing documents and the entire packet of governing documents. The board also has to provide cost estimates for providing these documents. It can charge, but only actual costs. This is not a profit-making endeavor and the director in charge is not generally compensated for doing the work, unless a manager is under contract to do it on behalf of the association and the manager presents a bill or has a contractual arrangement.

These documents must be provided within 10 days of the request and penalties, damages and attorneys’ fees can be awarded to buyers for failure to cooperate.

Most HOA elections require a secret ballot package sent out at least 30 days prior to an election that includes envelopes to return to an inspector of elections. Because the 2006 California law was modeled on public elections, there are a number of difficult aspects for HOAs that have historically dealt with proxy voting. The HOA has to have rules that explain many aspects of the elections and inspectors, and that provide for equal access by candidates and those with opposing views if the HOA directors are treated to use of HOA resources for their candidacy or views.

Owners have rights to view extensive financial records. The law is generous in what owners can see related to financial records. The request has to be presented in writing by the owner and the HOA can charge for copies and costs of production, to a reasonable degree.

HOA liability insurance for accidents and directors’ acts is imperative!

Check for insurance policies. The members and the directors have the right to be protected with liability insurance coverage and most HOA documents require it.

Most HOAs could benefit greatly from professional management (assuming the person is trained in HOA management as opposed to general property management only).

Unless a small group of owners wants a second taxing job they don’t get paid for while carrying responsibility and liability and having to give an inordinate amount of time to the HOA, an HOA can benefit October 2013 | ECHO Journal 13

from professional management. The Mini Courts HOA has hired management.

The membership was polled, allowed to vote, approved an assessment increase although not drastic, and the President is no longer alone in service – all because he worked hard to organize records, learn basic requirements, present options, and gather support for a proper structure in the association, and he and the board were able to convince owners that professional management was a good option. If a board is not headed in this direction, then it is imperative that the directors seek to learn California compliance requirements. It is critical to the health of the association and their own pockets. Legislators add new laws every single year that impose more obligations on HOAs because owners complain, long and loud about the shortcomings in their HOA. The courts are plagued with HOA related lawsuits based on director errors and omissions and the costs of liability and other insurance coverage continues to escalate.

And deferred maintenance is a rampant issue in California HOAs. Nothing gets the attention it needs when there is no active responsible board in place. And when things fall apart, the finger pointing begins. HOA lawyers are busy sorting out the differences that arise and negligence that commonly occurs when no one steps up, or those that do fail to fully understand their responsibilities.

Resources: Directors, managers, vendors and homeowners in HOAs are hungry for information, although many would prefer to remain “armchair quarterbacks�. ECHO offers seminars and an abundance of resources and contacts and is a very good place to start looking for information. If the President of Mini Courts HOA had no resources, or was not willing to go out and seek any, the association members would ultimately feel the pinch, maybe in little ways, or maybe in a very big way. He had to look for insurance policies and an agent, had to look for budgets and reserve studies and a provider, had to read the association documents and scan the laws to see what he needed to know to get the right kind of help. He needed to locate contractors because if the streets were allowed to fall into disrepair or the front yards were no longer maintained 14 echo-ca.org

well, there might be accidents or lost “curb appeal.” If rules were not sent out, they could have experienced an overabundance of vehicles and ended up with 5 or 6 vehicles parked face in or blocking driveways in the “mini courts”.

There is also a considerable amount of information available on the web – however, consider the source. Knowing how to operate legally and how to get what you need in place to do so is what keeps HOAs out of court. You can locate the Civil Codes at www.ca.gov by navigating to the state’s 29 codes and you can pull up sections by code number, after searching the code itself or by a word search. In 2013 the Davis-Sirling Common Interest Development Act is found at Civil Code Sections 1350-1378.

As of January 1, 2014, the Davis-Stirling Act will move to the 4000-6000 series of the Civil Code. ECHO has both the current and “new” versions of the Davis-Stirling Act on its website at www.echo-ca.org/ law. Law firms have access buttons to the Davis-Stirling Act on their sites and you can find conversion charts from the old to new and new to old statutes on the CLRC site (California Law Revision Commission), and ECHO’s website, and most law firms that advertise on the web.

Don’t get confused about DavisStirling. com. That is a law firm website strategically named, and although a good resource in many ways, it is often confusing to lay people who mistake it for a state agency site. Watch out for the sites that feed on negativity – such as complaints and threats. They offer very few solutions to any problem. If you are looking for help in doing things right, standing up as a board member, or resolving a dispute, stay with those sites that offer real help, including my site at www.californiacondoguru.com.

By Beth A. Grimm, Esq. ECHO East Bay Resource Panel Chairperson, 2012 ECHO volunteer of the Year, a 20+ year member of ECHO and CAI, past Public Relations Chair of the California Legislative Action Committee (CAI-CLAC), and author of FINDING THE KEY TO YOUR CASTLE, THE CONDO OWNERS HANDBOOK by Sourcebooks, THE DAVIS STIRLING ACT IN PLAIN ENGLISH, 100s of articles, and more than 30 Primers on various topics.

Visit www.californiacondoguru.com for helpful resources, facts, FAQs, and information.

October 2013 | ECHO Journal 15

STRATE

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EGIC FOR

PLANNING BOARD MEMBERS

BY DEBRA A. WARREN, PCAM, CCAM, CMCA

September October 2013 2013 || ECHO ECHO Journal Journal 17 17

M

ost successful businesses have embraced the concept of strategic planning and the results attained drive the direction, resources, and decisions made in the daily course of doing business. It guides the leadership and unites the employees and partners through common goals and objectives.

Since the benefits of developing a strategic plan are generally positive, why don’t community associations enthusiastically proceed along the same path? There are several answers to this question. One answer is simply the perception that creating a plan is complicated and requires a lot of time and money. Another answer is that many community association volunteers believe that the 30-Year Reserve Study is their plan. While this financial tool is an important part of a comprehensive plan, it does not include many factors that contribute to the overall health of the community. Some of these factors are changing demographics, local economic conditions, and aging landscaping and design elements. A complete plan will also consider the needs and wants of the individual community members.

Let’s first tackle the perception that creating a plan is complicated and requires a lot of time and money. If we look at some of the examples used in the business environment—SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats), Team Alignment, or Scenario Planning—this might be a true statement. But we can take the essence of these models and apply three simple steps—preparation, development, and implementation—and we now have a process that can be used by any size community association.

Step 1: Board Member Preparation Before you can begin to initiate projects and programs, it is necessary for you to have a general understanding of your association.

This is true even if you don’t have a strategic planning process. So to prepare for service on the board, as well as for planning, ask yourself these five questions.

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Do you understand the legal structure?

The CC&Rs, Articles of Incorporation and Bylaws provide you with information about the structure of your community.

First the CC&Rs define maintenance and financial responsibilities of the association and the members. All of the funding for the association comes from the members, and the formulas and limitations on assessments are also found in the CC&Rs. Next are the Articles and the Bylaws which set forth the rules for operating the association as a corporation. These documents contain information about meetings, elections, and distributing information to the membership. You don’t need to memorize any of this information, but understanding the legal structure will help you fulfill your obligations as a Board member.

Do you understand the financial condition of your association?

The objective of this second question is for you to look at the big picture, not at how much it costs to change a light bulb.

You will need four documents to provide you with the necessary information.

You will need the most current month’s balance sheet and revenue and expense report along with this year’s budget and the most recent reserve study.

This year’s balance sheet will tell you how much cash you have, how much money is owed to the association and how much the association owes to vendors and/or lenders. The current revenue and expense report will tell you if you are operating within budget for the current fiscal year. The current budget will provide information on all the services and projects funded for this year and the cash flow schedule in the reserve study will inform you of the funding required over the next 30 years to keep your association’s common elements properly maintained.

Do you understand the human resources available to your association?

Allocating human resources, including the time of the volunteer board of directors, is equally as important as the financial resources. Therefore, it is important to be aware of the services

outsourced to professionals versus the services that are absorbed by volunteers.

Do you have a professional management firm? What projects does the board choose to manage by volunteers? Will you be delegating projects to volunteer committees? Every association is different so a quick assessment of human resources will be helpful to the planning process.

What is important to your members?

If improving the landscaping is important to you, it is likely that you will be most familiar with others in your community who share the same desire. As a decision maker for the entire community, it is necessary to have some form of outreach to understand clearly the priorities and needs of all the members in your community. Ask your committee representatives for their perspective on needs, conduct an annual survey, or develop a task force to ask members what is important to them.

What conditions are present in your general community?

Conduct some general research into your surrounding community to determine factors that will impact your association and its members. Gather information about the status of the employment and housing market in your community. Keep track of plans for new development or other changes to property use in your area. If there are other community associations in your neighborhood, work to establish a process for sharing information.

By investing time in the process of learning about your community, you will not only create a strong basis for service to the association, you will also establish a solid foundation to begin the process of developing an effective plan.

Step 2: Developing the Plan Developing a strategic plan for your association will require a commitment by the board and each of its members.

Each member should be prepared to invest 10 – 15 hours to complete the plan. Although this time commitment

is divided into four specific tasks, it is important to move through the process as steadily as possible.

Purpose and Values Set aside 1 to 2 hours to discuss the purpose of your association and your core values. Every association is different and your values will be determined by your region, demographics, and size.

There are many books and tools that can help with this process. One question can help with this definition: “What makes your community unique?�

Develop the Agenda for the Planning Session Select a time period when all board members can attend and a location that will minimize disruptions. It is recommended that you not conduct this session in conjunction with a board meeting at the end of a long day. Instead try to set aside time on a Saturday morning or on a weekday when you can begin by 1:00 in the afternoon.

The goal is to create 4 to 6 hours of uninterrupted time.

When developing the agenda, you will also need to decide if a facilitator will be used to help with the discussion.

A facilitator is a neutral party who is responsible for keeping the discussions on point and for making sure that everyone participating has equal opportunity to share ideas and opinions.

The goal at the end of the day is to have a plan that was developed by all board members, not by the resident or the strongest voice in the room. The most sustainable plans are developed by all members sharing ideas and opinions.

Brainstorming – The Master List The first part of the planning session involves all participants sharing ideas, priorities, and projects. You will want to make sure you have a current, midterm and long-term perspective. What do we want to complete in the next year?

Three years? Five years? The goal is to have a master list that can be used for a detailed discussion. This is the portion of the planning session that benefits the most from the services of a facilitator.

The role of the facilitator is to assure October 2013 | ECHO Journal 19

that all attendees are participating, that differences of opinion can be shared in an accepting environment and that all ideas receive the same consideration.

The facilitator may also use a variety of tools to create a list that is manageable as the group moves into the next phase of the planning day.

“Don’t let the perfect be the enemy of the good.� What is most important is that you finish the plan, so you may experience the benefits. Once the plan is in place it will move into the implementation phase where constant review, analysis, and modifications will take place as circumstances change.

Allocating Resources & Prioritization

Step 3: Successful Implementation

In this final step of the planning session, the group talks about each item on the list, estimates the financial and human resources required and assigns a priority to each item.

It is common for some items to gather support during the discussion and others to be eliminated as more pressing matters are identified. The plan will be based on the final list of priorities and is generally drafted after the session is completed. The most critical step in completing the plan, is to complete the plan. It can be tempting to get attached to creating a perfect document to post in the Club House or on the community website. Author Patrick Lencioni, says

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Implementing your strategic plan occurs over a period of time. It will be necessary to incorporate the results of your plan into your reserve study and into the operating budgets for future years. Generally speaking you should begin or reevaluate your plan 6 months before the beginning of your fiscal year so that the planning results can be included into your next budget. If you have available resources to implement projects in the current year, that will be a bonus.

Successful implementation also requires regular review. Schedule a portion of

every board meeting for reviewing progress, monitoring outcomes, and reallocating resources or deadlines.

Complete the review by communicating the results to all stakeholders.

By following this simplified process and adding your own sense of commitment and discipline, your community will have a guide for current and future leaders, members and partners.

There are many benefits that your community will experience when the board is guided by a strategic plan. The board’s actions will be consistent because they will be based on the priorities established in the plan. Projects can be scheduled in a proactive manner to take advantage of pricing opportunities and timing.

Board members will benefit because the decisions required for implementation can be placed on an Annual Calendar and they will have adequate time to prepare.

Management benefits because they can proactively calendar the scheduled activities and communicate clearly with the association members. And finally, members benefit as the resources they contribute are being allocated strategically to meet their needs.

Debra Warren is the principal at Cinnabar Consulting in San Rafael.

Cinnabar provides businesses with the tools they need to maintain healthy and successful organizations by creating and implementing comprehensive training programs, providing team assessment and development, and facilitating effective meetings. She was previously the owner and CEO of Powar Management.

Additional Resources The Table Group, Patrick Lencioni Library www.thetablegroup.com Field Guide to Non Profit Strategic Planning and Facilitation Carter McNamara, MBA, Ph.D. Authenticity Consulting, LLC www.authenticityconsulting.com

October 2013 | ECHO Journal 21

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By Richard Tippett

Twenty Questions to Ask Before Hiring a Construction Manager

P

rior to retaining a construction manager or consultant, you should satisfy yourself that the

firm you’re considering is the best for your project.

October 2013 | ECHO Journal 23

To help in making up that decision, invite each candidate, individually, to a board or committee meeting, sit with him or her and conduct your interview. Their answers to these questions will assist you choosing the individual or firm that best meets your needs.

Other questions may come to mind as you read this list. Be sure to write them down and ask them of your prospects.

Interview your prospective construction managers carefully and compare their answers. You will be relying on the results of their work for at least 10 years.

Remember, also, that the least expensive consultant may not always be the best choice; a little extra money spent on knowledge and experience can often produce great savings in the cost of the construction of the project itself. Look for a construction manager who wants

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to work with you, is willing to meet your special needs and schedule, and with whom you feel comfortable.

1 2 3 4

Does the company have a license for the type of work that they will be managing?

How long has the company been in business?

What type of projects do they consult on or manage?

Does the company specialize in working with homeowner association?

5 6

What professional organizations does the company belong to?

What types and amounts of insurance does the firm have?

1. Errors & Omissions

$_________

2. Property Damage

$_________

3. Personal Injury

$_________

4. Workman’s Compensation

$__________

5. Vehicular

$_________

7 8

Will the firm provide you with references for both current projects & projects more than two years old?

Who will be the person on their staff assigned to your project?

1. How long has he/she been employed by the firm?

2. How many years experience does he/ she have with projects similar to yours?

9 10

Will a firm representative be available to attend board meetings to give periodic progress updates?

Change Order preparation

Board meeting attendance

Job schedule updates

Mileage

Copying

Telephone calls

11 12 13 14 15

Do they require a retainer fee or deposit?

If so, how much?

What is their federal tax ID number?

Will the company analyze your problems and present alternatives?

Will the company develop cost estimates for the alternatives?

Do they conform to their design work to local building code requirements? To the CSI format?

16 17 18 19 20

What is their estimate of the length of time that it will take to complete your project?

What will they do to minimize the disruption at your association while work is underway?

Do they provide any form of construction quality observation or auditing?

Has the firm ever been let go from a project by a client? What was the reason?

What do they believe separates them from their competition?

Enjoy the process!

Richard Tippett is the principal of ERTECH, Inc, based in Watsonville and San Francisco CA. He is a former Chair of ECHO’s Maintenance and Central Coast Resource Panels and a former member of ECHO’s Board of Directors.

Does the company charge for any of the following?

Letters to the board or management company Notices to homeowners October 2013 | ECHO Journal 25

Oh no, not in my

26 echo-ca.org

By Sharon Glenn Pratt, Esq.

neighbor’s backyard!

A

rchitectural review is serious business for an association board. One of the important attributes of any type of planned unit development is its high standard for uniform construction,

design and aesthetics. People choose to live in planned communities for this very reason. As an association board, you play a vital role in enforcing and maintaining these standards, often with the help of an architectural committee.

October 2013

| ECHO Journal 27

H

ow should you, as a board or committee, approach the process? Your governing documents, along with pertinent California statutory and case law, will provide the framework for you to follow.

One owner wants to remove structural walls in his remodeling. Another wants an elaborate arbor built over her backyard. Yet another seeks to add a koi pond.

What to do?

You may be tempted to reject all proposed additions or remodels, just to keep things simple and uniform, and to satisfy neighbors who oppose the improvements. Yet blanket rejections are as irresponsible as a laissez-faire acceptance of every proposed change. Every proposal should be considered on its own merits. You have a duty to protect property values. Remodeling and making improvements can preserve and increase those property values, when they are done correctly. To protect against shoddy work and unsightly changes, request an appropriate expert’s stamp of approval from a structural engineer, architect, or koi pond expert, whatever the case may be. A mock-up of the arbor, structural calculations on the wall removal, a photo of a similar koi pond—all can do wonders in assuring a quality improvement.

Modifications of the requested improvement can be suggested and approval can be made contingent on such changes.

Let the owners know your concerns, and those of their neighbors, and engage in a give and take process when discussing whether to grant architectural approval.

If your committee is made up of board members, be careful not to conduct your architectural review behind closed doors, or on an ad hoc, over-the-phone or email basis. Under Corp. Code section 7211, when a committee constitutes a “committee of the board”, the notice and quorum requirements for board meetings also apply to the committee.

This means that your discussion of the application, as well as your vote, should all take place at an open noticed meeting.

Whatever you do, don’t ignore or “back burner” an application that you have received. A lack of response from the architectural committee may be deemed to be an approval after a certain amount of time, depending on your governing documents.

28 echo-ca.org

Having a step-by-step procedure in place for all architectural review applications is advisable. California law requires that the decision of the committee and/or board must be made in good faith and may not be unreasonable, arbitrary, or capricious.

It may not violate any applicable codes, such as building codes, land use, or public safety provisions (Civil Code section 1378).

A written decision should be issued.

What if the owner is unhappy with the decision? Your governing documents are required by law to include an appeal procedure that is “fair, reasonable, and expeditious” and “provides for prompt deadlines.”

Owners are typically quite invested, both financially and personally, in the architectural changes that they propose. As a board, recognize this fact. The appeal process and hearing can be emotionally charged. The more controversial the issue, the more important it is for the board to follow proper formal procedure.

Owners will appreciate the fact that you are taking their proposals seriously and

giving them due consideration. If your governing documents do not contain the roadmap for the architectural committee and board to follow, including prompt deadlines and a maximum time for response, then it is time to add such a written procedure. Not only is it mandatory that it be included in your documents; it is also mandatory that a copy of the procedure be provided to the owners on an annual basis [CC §§1378 (a) (1) and 1378(c)].

You are not likely to please everyone every time with your architectural review decisions, but all parties involved will appreciate an orderly, professional, and legal process, and the fact that the decision has been made within such a context.

Sharon Pratt is the managing partner of Pratt & Associates in San Jose, California.

She is a specialist in common interest development law and litigation and has been practicing in the San Jose area for 28 years.

October 2013 | ECHO Journal 29

QUESTIONS TO ASK YOUR BANKER

By Geri Kennedy

30 echo-ca.org

T

he selection of a banking relationship for your association is just as important, (if

not the most important), as the selection of any other vendor for the property. The best option is a bank that is familiar with the HOA industry at a minimum and preferably one that has a specialized department or staff who understand your needs.

October 2013 | ECHO Journal 31

C

ommon interest developments (CID’s) are unique in their banking needs. The association will have multiple deposits throughout the month, officers that may change every year or even more frequently, a management company or bookkeeper that needs access to account information but may not be a signer on the account and requirements for maintaining reserve accounts.

Although the CID is generally a nonprofit corporation, it is still considered a commercial account. As such, many of the “special deals” offered are not available. It is important to understand what your bank can do to help your association keep your funds safe with a minimum of paperwork and hassle.

The following list of questions will be helpful in choosing the right bank for your association: 1.

1 Is this an “HOA Friendly” bank.

Does it have staff or better yet a full

e. Is there a procedure to place an account “on hold” in the event of a delinquency collection process.

division dedicated to handling association accounts.

22. Are all accounts insured by FDIC? Your governing documents may require this.

66. What online banking options are available?

a. Is Billpay an option?

33. How are signature cards handled?

b. What information can be seen?

a. Can one card be used for all accounts, including CD’s?

c. Will information on CD’s or loans be available?

b. How much personal information from the volunteer board members is required? c. What happens when there is a change of account signers? Do prior officers have to “sign-off ”?

d. Can additional board members, accountant, etc. be granted full or limited access?

77. Are debit or credit cards available? a. Can limits be placed on purchases?

d. Do the board members need to physically go into a branch?

b. Can access to cash be limited or denied?

44. What are the charges and fees? a. Is there a minimum balance to maintain to avoid a service charge?

c. Are there fees?

88. Does the bank provide a CD

b. Are there per check or per deposit charges?

placement service for funds in excess of the FDIC limits?

c. What are the charges for stop payments, wire transfers, returned homeowner assessment payments.

a. How does the service work: b. Are there fees? c. What is the procedure for placing or withdrawing funds?

d. Is there a charge to send a duplicate statement to another board member, accountant or management company?

d. Are statements provided in summary form with a single 1099 at year end?

25. Does the bank provide Lockbox

e. How are renewal reminders provided?

services for the homeowner’s assessment payments?

f. What controls are in place to avoid placing more than the FDIC limits in any one bank?

a. What are the charges? b. What options are available for the homeowner? i. Automatic debit from their account each month. ii. Credit card. iii. Payment through the bank’s website. iv. Personal online banking. c. How are the payments reported to the association? i. E-mail/PDF/Data file/Web access d. Do homeowners need to have a coupon book or statement coupon? i. What are the costs? ii. Will the bank assist with the ordering process?

32 echo-ca.org

g. Are the recipient banks “vetted” for safety and security?

99.

Does the bank have a loan program for CID’s? a. While this is not a frequent need, it is good to know that the bank understands the industry sufficiently to know how a loan should be processed. b. What amounts and terms might be available? c. What fees are involved? d. What requirements must the association meet to qualify?

10. What will be the bank’s relationship 10 with my bookkeeper, accountant and/or management company?

a. Generally, a bank employee will only discuss account specifics with one of the account signers. This generally does not work for CID’s as the board member signers are off at their regular jobs or are out enjoying their retirement and don’t have time to be calling the bank all the time. b. An HOA friendly bank should have a procedure for authorizing your management company or other staff to receive information and discuss your accounts. c. The management company may require additional services, such as remote scanners to make deposits from their office, courier service, special data files for reporting the lockbox information, online access so statements can be printed close to the start of each month and cleared items can be viewed, etc.

11. What are your rates?

11 a. This is generally one of the first questions asked, however, it is probably the least important in the association’s quest for the best bank for their needs. b. Rates at the moment are still quite low, so the income involved has a minimal impact on the association’s bottom line. c. The banks are fairly competitive regarding rates so the dollar differences between the banks will be insubstantial.

This may seem like a daunting list, however most of the HOA Friendly banks will be ready with these answers and more! It should give you a great start however in choosing the bank that will best serve the needs of your association.

Geri Kennedy is Vice President of Focus Business Bank. She has been a member of the ECHO Board of Directors, continues to serve on the ECHO Legislative Committee and several Resource Panels, and is a frequent speaker and contributor to ECHO events. She was elected the ECHO Volunteer of the Year in 2002.

October 2013 | ECHO Journal 33

Beyond Privatopia Non-Member Price:

$20.00 $25.00

The rise of residential private governance may be the most extensive and dramatic privatization of public life in U.S. history.

In Beyond Privatopia, attorney and political science scholar Evan McKenzie explores emerging trends in private governments and competing schools of thought on how to operate them, from state oversight to laissez-faire libertarianism.

Condominium Bluebook 2013 Edition $17.00 Non-Member Price: $25.00

Condos, Townhomes and Homeowner Associations Member Price: $29.00 Non-Member Price: $45.00

Community Association Statute Book—2012 Edition Member Price: $15.00 Non-Member Price: $25.00

To make these a sustainable investment, new buyers, owners and board members need to understand “best practices basics” of how this form of housing works and have more realistic expectations of this form of “carefree, maintenance free” living.

Contains the current version of the Davis-Stirling Common Interest Development Act, the Civil Code sections that apply to common interest developments and selected provisions from other codes important to associations.

Robert’s Rules of Order $7.50 Non-Member Price: $12.50

The Board’s Dilemma Non-Member Price:

A step-by-step guide to the rules for meetings of your association, the current and official manual adopted by most organizations to govern their meetings. This guide will provide many meeting procedures not covered by the association bylaws or other governing documents.

In this essay, attorney Tyler Berding confronts the growing financial problems for community associations. Mr. Berding addresses board members who are struggling to balance their duty to protect both individual owners and the corporation, and gives answers to associations trying to avoid a funding crisis.

2012 Community Association Treasurer’s Handbook Member Price: $29.00 Non-Member Price: $35.00

Reserve Fund Essentials Member Price: $18.00 Non-Member Price: $25.00

The Condo Owner’s Answer Book Non-Member Price:

This book is an easy to read, must-have guide for anyone who wants a clear, thorough explanation of reserve studies and their indispensable role in effective HOA planning. The author gives tips to help board members mold their reserve study into a useful financial tool.

An excellent guide to understanding the rights and responsibilities of condo ownership and operation of homeowner associations. The question-and-answer format responds to more than 125 commonly-asked questions in an easy to understand style. A great resource for newcomers and veteran owners.

This well-known compact guide for operation of common interest developments in California now includes a comprehensive index of the book and a chapter containing more than 200 frequently-asked questions about associations, along with succinct answers.

W NETION I ED

Home and Condo Defects Member Price: $12.95 Non-Member Price: $17.95 Construction defect litigation can be confusing, expensive and fraught with legal pitfalls. This eye-opening guide, written by accomplished construction-defect attorneys, is an essential tool for board members who need to understand the legal process.

Questions & Answers About Community Associations Member Price: $18.00 Non-Member Price: $25.00 For 12 years, Jan Hickenbottom answered homeowners’ questions in her Los Angeles Times column on community associations. Now collected in one volume, readers can find answers to almost any question about CIDs.

34 echo-ca.org

$10.00 $15.00

$15.00 $20.00

The Handbook is an in-depth guide to all aspects of association finances, including accounting methods, financial statements, reserves, audits, taxes, investments and much more. Not for the accounting novice, this is a tool for the treasurer or professional looking for specific information about association finances.

Board Member Handbook Member Price: $15.00 Non-Member Price: $25.00 This publication is the essential guidebook for HOA Board members, dealing with governance, finances, insurance and maintenance issues.

Revised and updated in June 2012.

Dispute Resolution in Homeowner Associations Member Price: $15.00 Non-Member Price: $25.00 This publication has been completely revised to reflect new requirements resulting from passage of SB 137.

Publications to answer your questions about common interest developments Order Online at store.echo-ca.org

Bookstore Order Form Board Member’s Guide for Contractor Interviews $15.00 Non-Member Price: $25.00

Executive Council of Homeowners 1602 The Alameda, Suite 101, San Jose, CA 95126 Phone: 408-297-3246 Fax: 408-297-3517

TITLE

QUANTITY AMOUNT

This report is a guide for directors and managers to use for interviews with prospective service contractors. Questions to find out capabilities and willingness of contractors to provide the services being sought are included for most of the contractor skills that associations use.

SUBTOTAL CALIFORNIA SALES TAX (Add 8.625%) TOTAL AMOUNT

Board Member’s Guide for Management Interviews Member Price: $15.00 Non-Member Price: $25.00 This guide for use by boards for conducting complete and effective interviews with prospective managers takes the guesswork out of the interview process.

Over 80 questions covering every management duty and includes answer sheets matched to the questions.

Yes! Place my order for the items above.

Check

Visa

MasterCard

Credit Card Number Exp. Date

Signature

Name (please print) Association (or company) Email Address City

State

Zip

Daytime Telephone

October August 2013 | ECHO Journal 3535

36 echo-ca.org

advertiser index

about ECHO

Ace Property Management..................28 www.acepm.net

Focus Bank............................................20 www.focusbusinessbank.com

American Management Services........21 www.amspcam.com

Haney Accountants, Inc......................38 www.haneyinc.com

Angius & Terry.......................................3 www.angius-terry.com

Helsing Group, The..............................33 www.helsing.com

Applied Reserve Analysis....................29 www.appliedreserveanalysis.com

M&C Association Management Services...........................2 www.mccommunities.com

A.S.A.P Collection Services.................33 www.asapcollect.com Association Reserves...........................36 www.reservestudy.com Benjamin Moore Paint & Company...28 www.benjaminmoore.com Berding|Weil ........................................44 www.berding-weil.com Cityscape Property Mgmt....................13 www.cityscapeHOA.com Collins Management............................38 www.collins-mgmt.com Community Association Finacial..................................................14 www.HOAsManagement.com Compass Management........................33 www.gocompass.com Condominium Financial Management.........................................12 www.condofinancial.com Cool Pool Service..................................14 Cornerstone Community Management.........................................19 www.cornerstonemgt.biz Ekim Painting.......................................19 www.ekimpainting.com Eugene Burger Management Co.........11 www.ebmc.com First Bank..............................................15 www.firstbankHOA.com

The Manor Association........................36 www.themanorassn.com Mutual of Omaha Bank.......................36 www.mutualofomahabank.com Neighborhood Association Management.........................................32 www.neighborhoodam.com PML Management................................15 www.pmlmanagement.com Professional Gutter Service.................21 www.pmlmanagement.com Pollard Unlimited.................................20 www.guttercleaning.com R.E. Broocker Co...................................28 www.rebroockerco.com Rebello’s Towing..................................41 www.rebellos.net Saarman Construction.........................13 www.saarman.com Silicon Valley Civil & Construction Quilici Engine.......................................25 www.svcse.com Steve Tingley Painting, Inc..................43 www.tingleypainting.com

WHAT IS ECHO? Serving Homeowners to Build Strong Community Associations The Educational Community for Homeowners (ECHO) is a nonprofit membership corporation dedicated to assisting California homeowner associations. ECHO provides help to homeowner associations on many fronts: finances, legal issues, insurance, maintenance and management. Members receive help through conferences, trade shows, seminars, online education, a monthly full-color magazine and discounted publications.

Who Should Join ECHO? If your association manages condominiums or a planned development, it can become a member of ECHO and receive all of the benefits designated for homeowner associations.

Benefits of Association Membership • Subscription to monthly magazine • Access to members-only online education • Updates to the Association Statute Book • Frequent educational seminars • Special prices for CID publications • Legislative advocacy in Sacramento

ECHO Membership Dues Association Membership 2 to 25 units....................................$120 26 to 50 units..................................$165 51 to 100 units................................$240 101 to 150 units..............................$315 151 to 200 units..............................$390 201 or more units...........................$495 Professional Membership.................$425 Association Management Membership.......................................$425 Individual Membership.....................$100

How Do You Join ECHO? Over 1,700 members benefit each year from their membership in ECHO. Find out what they’ve known for years by joining ECHO today. To apply for the membership, sign up online at www. echo-ca.org.

For more information about membership and ECHO, call us at 408-297-3246 or visit the ECHO website.

October August 2013 | ECHO Journal 3737

directory updates

All current listings may be found in our Professionals Directory available online at www.echo-ca.org.

New Members Bay Alarm 1290 Hammerwood Ave. Suite D Sunnyvale, CA 94089 Contact: Doug Easter Tel: (408) 986.0519

Become an ECHO Professional Member and receive the benefits of membership.

To learn more, visit our membership page at www.echo-ca.org 38 echo-ca.org

ECHO event calendar

RESOURCE PANEL CALENDAR Wednesday, October 2 Maintenance Resource Panel 12:00 Noon ECHO Office, 1602 The Alameda, Suite 101, San Jose

Thursday, November 7 North Bay Resource Panel 11:45 a.m.

Contempo Marin Clubhouse, 400 Yosemite Dr, San Rafael

Wednesday, December 11 South Bay Resource Panel 12:00 Noon Buca Di Beppo 1875 S. Bascom Ave., Campbell

Wednesday, October 9 South Bay Resource Panel 12:00 Noon Buca Di Beppo 1875 S. Bascom Ave., Campbell

Monday, November 11 Accountants Resource Panel 6:00 p.m.

Scott’s Seafood, 2 Broadway Oakland

Friday, December 13 East Bay Resource Panel 12:00 Noon Massimo Restaurant, 1603 Locust St., Walnut Creek

Friday, October 11 East Bay Resource Panel 12:00 Noon Massimo Restaurant, 1603 Locust St., Walnut Creek

Tuesday, November 12 Central Coast Resource Panel 12:00 Noon Michael’s On Main, 2591 S Main St., Soquel

Wednesday, December 18 Wine Country Resource Panel 11:45 a.m.

Serv-Pro, 373 Blodgett St., Cotati

Wednesday, October 16 Wine Country Resource Panel 11:45 a.m.

Serv-Pro, 373 Blodgett St., Cotati

Wednesday, November 20 Wine Country Resource Panel 11:45 a.m.

Serv-Pro, 373 Blodgett St., Cotati

Wednesday, October 16 Legal Resource Panel 6:30 p.m.

Porterhouse, 60 E 3rd Ave, San Mateo

Wednesday, December 4 Maintenance Resource Panel 12:00 Noon ECHO Office, 1602 The Alameda, Suite 101, San Jose

Details and agenda for resource panel meetings can be found on the ECHO website @ www.echo-ca.org/events.

REGULARLY SCHEDULED RESOURCE PANEL MEETINGS Panel

MEETING

location

Maintenance

First Wednesday, Even Months

ECHO Office, San Jose

North Bay

First Thursday, Odd Months

Contempo Marin Clubhouse, San Rafael

East Bay

Second Friday, Even Months

Massimo Restaurant, Walnut Creek

Accountants

Second Monday, Odd months

Scott’s Seafood Restaurant, Oakland

Central Coast

Second Tuesday, Odd months

Michael’s On Main, Soquel

South Bay

Second Wednesday, Even Months

Buca Di Beppo, Campbell

Wine Country

Third Wednesday, Monthly

Serv-Pro, Cotati

Legal

Quarterly

Varies

October 2013 | ECHO Journal 39

ECHO honor roll

ECHO HONORS VOLUNTEERS ECHO Resource Panels

Regional Seminar Speakers

Accountant Panel Marco Lara, CPA 650-632-4211

Marin David Feingold, Esq. Wanden Treanor, Esq. Glenn Youngling, Esq.

Central Coast Panel John Allanson 831-685-0101 East Bay Panel Beth Grimm, Esq. 925-746-7177 Cindy Wall, PCAM, CCAM 925-830-4580 Legal Panel Mark Wleklinski, Esq. 925-280-1191 Maintenance Panel Brian Seifert 831-708-2916 North Bay Panel Diane Kay, CCAM 415-846-7579 Stephany Charles, CCAM 415-458-3537 South Bay Panel George Engurasoff 408-295-7767 Wine Country Panel Pam Marsh 415-686-9342 Legislative Committee Paul Atkins Jeffrey Barnett, Esq. Sandra Bonato, Esq. Jerry Bowles Oliver Burford Joelyn Carr-Fingerle, CPA Chet Fitzell, CCAM John Garvic, Esq., Chair Geri Kennedy, CCAM Wanden Treanor, Esq.

San Francisco Steve Weil, Esq. Santa Cruz Lisa Esposito, CCAM Sharon Pratt, Esq. Rob Rosenberg, CCAM Paul Schultz Rosalia Tapia, Esq. Wine Country Carra Clampitt Bill Gillis, Esq. David Hughes Ken Kosloff Tom O’Neill Steve Weil, Esq. South Bay Derek Eckert Stephanie Hayes, Esq. Robert P. Hall Jr., Esq. Fresno Geri Kennedy David Levy, CPA Michael J. Hughes, Esq. Walnut Creek Stephanie Hayes, Esq. Lisa Esposito, CCAM Rob Rosenberg, CCAM Beth Grimm, Esq. ECHO San Jose Speakers September 24, 2013 Board Essentials Tyler Coffin Lisa Esposito, CCAM Pat Falconio Brian Kidney Mike Muilenberg Rob Rosenberg, CCAM Brian Seifert Wanden Treanor, Esq. Hot Topics Anton Bayer Ian Brown, CAM

40 echo-ca.org

Don Danmeier Glenn Kenes Nico March Steve Saarman Steve Weil, Esq. Legal Tyler Berding, JD, PhD John Garvic, Esq. Michael Hughes, Esq. Julia Hunting, JD, SE Kerry Mazzoni Alex Noland, Esq. Paul Windust, Esq. Recent Contributing Authors May 2013 Tyler Berding, PhD, Esq. Julia Hunting, Esq. Jeffrey Barnett, Esq. Ann Thomas Sherry Harvey, PCAM June 2013 Brian Kidney ECHO Maintenance Resource Panel Sandra Gottlieb, Esq. Alexander Noland, Esq. Tracy Neal, Esq. Stephanie Hayes, Esq. Richard Tippett Tyler Berding, JD, PhD David Levy, CPA July 2013 Anton Bayer, CFP Beth Grimm, Esq. Dave Phelps, ASLA, ISA Judy O’Shaughnessy Michael Petite August 2013 Julie Adamen Stan Malos, JD, PhD Sharon Glenn Pratt, Esq. John R. Schneider September 2013 Kevin Canty, Esq. Beth Grimm, Esq. Judy O’Shaughnessy Diane Rossi, PCAM, CCAM Steve Saarman

legislation at a glimpse

Hot Bills Bill No

Author

Subject

Status

Position

Summary

AB 968

Gordon

Elections in Small Associations

This Assembly bill has Support stalled in the Senate Transportation & Housing Committee.

This bill seeks to establish alternative election procedures for associations of 15 units or less, if approved by a majority of the members. The new procedures would allow qualifying associations to conduct votes in simplified fashion, by nominating candidates and casting ballots at the election meeting.

AB 637

Torres

Maintenance Responsibilities

This bill is now a two-year bill, and will be reintroduced under a new number in 2014.

Support

This ECHO-sponsored bill establishes that the owner of each separate interest is responsible for maintaining the exclusive use common area appurtenant to the separate interest unless otherwise provided for in the governing documents. ECHO is continuing to work to educate legislators on the importance of this clarification.

As the bill is now on a two-year track, ECHO’s text has been removed from AB 637. Our language will be reintroduced in a new bill in 2014.

Other Legislation Bill No

Author

Subject

Status

Position

Summary

SB 745

Committee on Transportation & Housing

Housing Omnibus Bill

This bill has passed the Assembly Appropriations Committee to the Consent Calendar.

Watch

“Omnibus� legislation is intended to clean up errors in existing codes, and proceeds absent any objections. This bill contains language that cleans up the rewritten Davis-Stirling act, among other provisions. ECHO is watching these changes closely to ensure that no substantive changes are introduced.

AB 126

Hall

Time-Share Mailing Lists

This bill not yet been set for hearing, and is dead for 2013.

Watch

This bill requires a time-share association to maintain a complete list of the names and postal addresses of all owners of time-share interests in the time-share plan and to update the list at least every 12 months.

AB 746

Levine

Smoking Prohibition

This bill failed in committee and is dead for 2013. The bill was granted reconsideration and may appear again in 2014.

Watch

This bill prohibits the smoking of cigarettes or other tobacco products in all areas of multifamily dwellings. It provides an exception for designated smoking areas.

AB 1360

Torres

Electronic Voting

This bill passed the Assembly with bipartisan support and is now in the Senate Judiciary Committee.

Support

This bill authorizes an association to conduct elections or other membership balloting by electronic voting. It also requires an association to provide each member with an opportunity to indicate that he or she will be voting electronically and to provide a member who did not indicate so with a paper ballot.

42 echo-ca.org