ECHO Journal - July 2014 by Echo

2014 ECHO Seminars p.6

Unforeseen Conditionsâ&#x20AC;&#x201D; The New Hidden Costs of Construction Projects

Running a Successful Monthly Meeting

p.8

p.16

A Salute to Condominium Directors p.22

It Starts with Us

p.26

We Won the Case: But Now What? p.30

July 2014

Serving Community Associations

echo-ca.org

Hidden Costs of Construction p. 8

ECHO 1960 The Alameda STE 195 San Jose, CA 95126 Change Service Requested

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news from ECHO

News From ECHO July 2014 Are we whiling away the hours, enjoying the amazing California summer here at ECHO? Heck no. We’re working to bring you the best information and advice to make your service as a homeowner association board member easier, more engaging and fulfilling. We’re trying lots of different approaches to giving you what you need and want, when and how you want it. Many of you have visited our website, and I hope you’re finding an amazing array of well-organized information, providing answers to your must-know questions. Not only will you find the ECHO Journal, going back to 2007, but carefully crafted articles under Education addressing virtually every topic of interest to HOAs and their boards. We also have all the statutes you should be familiar with, including the New Davis-Stirling Act, searchable by citation or keyword. And our Professional Directory offers a listing of ECHO members who specialize in homeowner association services. Coming soon is our community of communities: a place where ECHO members can share their experiences and best practices; with over 1300 association members, there’s a lot of learning to share so you won’t have to reinvent the wheel. We hope you use this resource again and again. Next month we’ll host the biggest HOA Trade Show for Board Members in California: ECHO San Jose. Join us to hear from over 20 industry experts offering their best advice on a wide range of topics during 12 sessions all day on August 23. You’ll also be able to visit with, and ask your penetrating questions of, over 100 professional service providers: HOA management companies, contractors, painters, paint manufacturers, landscapers, attorneys, CPAs, and more. They’ll be there to help with your questions and issues, as well as offer valuable prizes. And we’ll feed you lunch on the exhibit floor, included in your registration. Please see pp. 14 and 15 for a description of the event, and visit www.echo-ca.org/events and click on ECHO San Jose to get more information and register. We also have seminars coming up in Fresno, Monterey and Pleasant Hill for a half-day packed with info tailored for your association, offered by experts who provide services in your region. See page 6 for dates and locations. Finally, I hope you are enjoying the ECHO Journal. It’s a joy to produce and I fervently hope the information and advice is useful. Please don’t hesitate to let me know if there are subjects we should address or ways we can improve your membership experience.

Best,

Brian Kidney Executive Director

July 2014 | ECHO Journal

CONTENTS

26 8

16 30

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Unforeseen Conditions – The New Hidden Costs of Construction Projects It is not surprising to know that in the initial phases of every proposed construction project, it is the first task of the Construction Manager (CM), along with other trained professionals such as the Architect and Engineer of record, to develop projected cost budgets.

Running a Successful Monthly Meeting To reach our goal of shorter, more efficient meetings while still permitting homeowners to air views and opinions and allow the board to discuss, debate and take action on various issues, we streamlined how and what we did.

A Salute to Condominium Directors Condominium owners must take into account how very important volunteer directors are. They are the backbone of any condominium corporation. Without these dedicated volunteers , who would oversee the growth, improvement, security and legal operations regarding your valuable investment?

It Starts with Us

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 2014 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 1960 The Alameda, Suite 195 San Jose, CA 95126 408-297-3246 Fax: 408-297-3517 www.echo-ca.org info@echo-ca.org

We Won the Case: But Now What???

Office Hours Monday-Friday 9:00am to 5:00pm

From time to time, a community association is forced to sue a member who has violated the governing documents. This article addresses enforcement of judgments whether obtained by “default”—where the other party does not contest the lawsuit— or following a trial by jury or the court.

Board of Directors and Officers President David Hughes Vice President Karl Lofthouse Treasurer Diane Rossi

DEPARTMENTS

News from ECHO

2014 ECHO Educational Calendar

NEW at echo-ca.org

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

John Garvic David Levy Kurtis Shenefiel Wanden Treanor

ECHO San Jose — Saturday, August 23

ECHO Volunteers

ECHO Bookstore

Advertiser Index

Legislation at a Glimpse

Director of Communications Tyler Coffin

ECHO Event Calendar

Legislative Consultant Government Strategies, Inc.

Executive Director Brian Kidney Director of Marketing & Membership Toni Scurti

Design and Production Design Site ECHO Mission Statement Serving Community Associations

July 2014 | ECHO Journal

2014 ECHO educational calendar

ECHO Seminars Now there’s one near you. If you’ve ever wished that ECHO would hold a seminar closer to your association, chances are that we’ll be nearby during 2014. Don’t miss an opportunity to get the education you need with guidance from some of California’s top HOA attorneys and professionals. Take a look and mark your calendar. We can’t wait to see you there!

Santa Rosa

Sacramento

Marin Walnut Creek Oakland San Francisco

San Jose Campbell Santa Cruz

August 23 ECHO San Jose Annual Seminar & Tradeshow (see page 15) San Jose Convention Center, San Jose

DATE

EVENT

October 4 October 18

Monterey Educational Seminar East Bay Educational Seminar

echo-ca.org

Fresno Monterey

NEW

New legislation, quick tips, and fresh insights — we’re adding new information to our website every day.

Articles It’s Not Easy Being Little: Tips for Small HOAs

When your HOA doesn’t have the financial or human resources of a 300 unit complex, small tasks can seem huge: how do you handle business administration tasks? How do you survive a couple of delinquent owners? The answers aren’t easy, but this article offers a few good tips. Educational Topic: Association

Options for Irrigation Efficiency in HOA Landscaping

During this drought, water efficiency is important. Homeowner associations can often achieve big savings just by making sure that their current irrigation systems work. This article looks at a couple of different systems in use, and the best way to tune them up for optimal performance. Educational Topic: Landscaping

Ethics for Board Members

You do your best to be an ethical person. But being a board member can present new and confusing ethical dilemmas on a regular basis. This article outlines some of those common ethical dilemmas and the appropriate responses. It also offers a sample “Code of Ethics” for board members. Educational Topic: Board of Directors

When Can an HOA Board Raise Assessments?

“At budget time” is the obvious answer. But what about mid-year? What if the association wants to stagger its 20% increase over several months? Learn more about the limits on board authority to raise assessments. Educational Topic: Assessments

at echo-ca.org

How can HOA Boards Delegate Authority?

Now that the Open Meeting Act prohibits boards from making decisions through an exchange of emails (except in an emergency), board members that were used to dealing with routine matters that arise between regular board meetings have to change their methods. Boards can either meet more often, or figure out how (and when) to delegate authority. Educational Topic: Board Duties & Powers

Facebook Join Our Facebook Community Want to see pictures from our last seminar? Comment on our legislative activity? We only put the latest news up on Facebook, and we’d love to hear from you. Share your experiences, read important and amusing HOA news, and connect with fellow HOA owners on ECHO’s Facebook page. facebook.com/echoorg

ECHO Journal Read the ECHO Journal on the ECHO website before it arrives at your door. We usually post the latest issue on or before the beginning of each month. Log in to browse the latest articles, or read from a huge library of past issues. Find in: echo-ca.org/journal

July 2014 | ECHO Journal

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Unforeseen Conditions The New Hidden Costs of Construction Projects By Ken Kosloff, CSI, CCI

t is not surprising to know that in the initial phases of every proposed construction project, it is the first task of the Construction Manager (CM), along with other trained professionals such as the Architect and Engineer of record, to develop projected cost budgets.

July 2014 | ECHO Journal

hese are the anticipated costs the project will generate, including such items as labor, material and equipment expenses. Obviously, without such cost estimates, a homeowner association board would have no significant way of knowing if they have the resources to fund the project adequately. In order to develop the most accurate cost estimates possible, the CM will utilize a two step approach; first a constructibility/feasibility review and, second, the bidding process.

Constructibility/ Feasibility Review In the constructibility/feasibility review, the CM, utilizing “industry average” values for most expense items, develops generic costs for the project. These costs, set as a benchmark, are provided to the HOA to determine initially whether the scope of work, as first contemplated, is within their financial means. If so, then the CM will proceed with the bidding process to generate concrete, or hard, costs from the contractors vying for award of the project. If not, then the CM would have to “Value Engineer”, or reassess the scope of work, materials and methods of the project in order to reduce the projected costs and bring the project scope of work into an area that the HOA can afford.

Bidding Phase Building on the estimated costs of the constructibility/feasibility review, in

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the bidding phase, the CM will attempt to enhance the cost projections by putting the final project scope of work out to bid. To ensure that the costs provided by the bidding contractors are relatively accurate, the CM will develop specifications for the project that define, with great detail, what scope of work will be performed, in what manner, and with what acceptable materials. Each prospective contractor bidding on the project will have an opportunity to review the specifications, perform an onsite evaluation walkthrough, and generate their own estimated costs to perform the construction according to the specification’s guidelines. The selected bid will later become the fee structure of the contractor awarded the project. In both the constructability review and bidding phases, there is always one aspect of the cost calculation process that can give rise to confusion on the part of the HOA—the “Unforeseen Conditions” line item. Industry-wide, this is the flat ten to fifteen percent charge added to the end value of every bid and constructibility review/feasibility study figure. The comments from the board vary in tone, but all seem to highlight one general theme: Why should we budget a blank check line item for the contractor when we pay you to develop accurate and complete specifications and cost projections?

The answer is simple— there is no such thing as an accurate and complete cost projection.

There are a variety of unforeseen conditions that can impact the total cost of a project negatively. Here are several:

Jurisdictional Fees and Prerequisites

Most of the Bay Area’s local building departments, those infamous governmental agencies that approve construction projects and issue permits, have steadily, and stealthily, increased their permit costs. Unfortunately, uniformity in building department permit fees is not the norm. For example, in a review of 15 Bay Area building departments conducted recently, all had raised their rates significantly from recent years, and most had new or revised approval prerequisites. Prerequisites ranged from the number of visits by an inspector necessary to issue a Certificate of Occupancy upon completion of the project, to what tools had to be on hand when the inspector arrived in order to facilitate the inspection. Not suprisingly, when questioned individually, different personnel in the same building department had different prerequisites for identical construction projects. Such confusion and increased costs have lead to an unforeseen condition of time and fee expenses that cannot be measured accurately by contractors or consultants.

Decay / Dry Rot

Both the constructibility/feasibility review and bidding documentation discussed in this article base their projected costs on a visual inspection and review of existing conditions. Obviously, with few exceptions, there is no way for the CM or the bidding contractor to know what lies within building cavities when they develop the original cost projections. Only when these areas are opened up

does the true nature and extent of decay or mold come to light (pun intended!). Consequently, it is not suprising to have a contractor submit change orders subsequent to initial demolition, once the first building tear off has begun. Significant decay leads to significant additional costs. By state law it is the responsibility of the contractor to remove and replace such decayed material, and it is the responsibility of the HOA to pay for it.

Existing Conditions

Like decay, existing building conditions also may not be identifiable until the building structure is open. No one knows if the original construction was built according to the plans and blueprints, building code, and/or standards of workmanship applicable at that time. Notwithstanding, the repair methods developed in the current specifications, which the potential contractors use in establishing their bids, assume that all the existing construction was built according to the plans and the code that was in effect at the time of original construction. Consequently, if there was a deviation from the code, the condition would need to be remedied as an unforeseen condition. Granted, in cases of reconstruction instigated by litigation, repair schedules developed by experts in the field of forensic testing could mitigate the unforeseen condition, but those schedules do not evaluate every unit in every building for the same condition. The forensic evaluations perform â&#x20AC;&#x153;statistical samplingâ&#x20AC;? of a random number of locations (traditionally 10 percent of an HOA complex). Thus, there is usually no possible way of realizing exactly how many locations throughout the project have an existing condition that fails to meet building codes, until each and every location has been opened.

July 2014 | ECHO Journal

Hazardous Materials

Some older multi-unit residential construction projects may be infested with hazardous materials, most notably asbestos, lead paint or molds/fungus. Under traditional circumstances, these conditions may not affect the construction project and thus are not traditionally included in the original cost projections. For example, if the asbestos were in the ceilings of the units whose roofs are currently being re-roofed, then the only impact on the project would occur should a roofer fall through the roof and damage the ceiling. Understandably, there is no way to estimate how many times a rooferâ&#x20AC;&#x2122;s employees would fall through roofs throughout the life of the project! On the other hand, should the asbestos be in the existing roofing material, which the contractor would be removing, and replacing, then the initial budgets should include the remediation

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cost of removal and disposal of the asbestos.

Homeowner Scheduling

It is difficult for the CM to know the attitude of individual homeowners toward the work being proposed. Depending on the HOA membership, access issues generate many additional hours for the CM and contractor. When unit owners fail to allow access to their units for construction personnel to work or when unit owners fail to follow post construction policies such as limited usage of certain areas of the unit where material is not dry, the costs mount quickly. To mitigate project expense, the CM, HOA board and contractor meet at the inception of each project to develop a schedule for construction, identifying which buildings will be worked on in

a particular order to maximize efficiency during the life of the project. Equipment trailers are parked at one location and employees are dispersed based on the schedule. Preliminary notices are distributed to designated units and buildings, by both the CM and contractor several weeks before the work commences. The notices state what work will be commenced at each unit, the commencement day, and the term period of construction at each unit. The notices further state that it is the responsibility of the homeowners to have their units ready for construction (either interior or exterior work), including having all furniture moved to a safe and secure distance away from the construction area, having all valuable items removed and stored in a secure location, and having all pets confined. If the contractor fails to find the unit in such a prepared condition, delays occur because the work at that unit must be rescheduled and the construction

schedule revised. Likewise, when certain unit owners fail to allow access because they disagree with the HOA’s ultimate construction goals, or they fail to divulge prior vacation or other long absentee periods during the project period, the contractor is forced to revise the project schedule. Remobilization of the crew and equipment trailers to other locations on a weekly, if not daily basis, leads to change orders and additional costs.

Damaged Items

At the termination of the project, some unit owners may file expense reimbursement charges with the association for personal items that were damaged as a result of the construction. While the contractor, based on his liability for their damage, reimburses some items, many items are not, and are thus left for the HOA to determine ultimate liability and compensate members. Obviously, most

contractors will not reimburse for items that were the responsibility of the unit owner to store, secure or remove from the premises prior to construction that are subsequently damaged or destroyed. Resolution of such claims adds both time and money to the project budget. The above list is not exhaustive. While many hours are spent in the pre-construction phase to develop accurate cost representations, it is impossible to determine all variable costs that will impact the bottom line. In this regard, construction is more an art than a science, and contingency costs for “Unforeseen Conditions” are a necessary evil that must exist in order to allow an HOA to fund needed projects adequately. Without such a contingency, the greatest delay possible—the inability of the HOA to adequately finance the project from inception to completion—would occur regularly, forcing suspension of work. Ken Kosloff is a Prinicipal at Richard Avelar Associates and a member of the ECHO Maintenance Resource Panel.

July 2014 | ECHO Journal

ECHO SAN JOSE 42nd Annual Seminar & Trade Show Saturday, August 23, 2014

This August, ECHO San Jose returns to the San Jose Convention Center for its 42nd year! ECHO’s Annual Seminars are the only opportunity to receive objective, in-person training for board members (or future board members!). We’ll cover a dozen important subjects, including: • HOA University: important training in the four major areas of board operations. Attend all four sessions and earn a certificate. • Drought Response: how to mitigate the impact of the drought and related regulations. • Managing the Manager: learn how to get the most from your most important service provider. Come for answers, and enjoy the camaraderie of your fellow board members. Registration always includes a buffet lunch, 12 educational sessions, access to a vibrant exhibit floor and hundreds of prizes. 14 echo-ca.org

Visit the ECHO website for complete event details: www.echo-ca.org/events

Event Information

sessions

Location:

HOA UNIVERSITY

San Jose Convention Center 150 W San Carlos St., San Jose, CA 95113 Exibit Hall 3, facing S. Almaden Blvd.

• Finance • Management • Legal • Insurance

Time: 8:00 am to 4:30 pm

HOT TOPICS

food: Coffee and tea in the morning, and a lunch buffet in the afternoon are included in the price of admission.

• Resident Owned Parks • Maintenance Issues • Water Conservation

Parking: Parking at the Convention Center is $20. However, parking is available for $7 in the Almaden/Woz Lot across the street, located at 401 Almaden Blvd. Public transportation options are also convenient and plentiful. Please see the ECHO website for more information.

Lodging: ECHO San Jose is immediately connected to the San Jose Hilton. Special rates are available through the ECHO website, or by calling the Marriott at (877) 901-6632.

Register: Members: $89, Nonmembers: $119 Registration includes lunch and access to all sessions. Register online, or return the form on this page.

Yes, reserve ______spaces for the ECHO San Jose 42nd Annual Seminar & Trade Show. Amount enclosed: $__________ (attach additional names) Name: Email Address: HOA or Firm: Address:

LEGAL • Governing Documents • Avoiding a Reconstruction Nightmare • Managing the Manager & Managing the Lawyer • Legislative Update

sPEAKERS David Levy, CPA Levy Erlanger & Co.

Regan Brown GB Group

Ian Brown, CCAM M&C Association Management

Chris Sigler C.L. Sigler & Associates

Alex Noland, Esq. Swedelson Gottlieb

Stephanie Hayes, Esq. Hughes Gill Cochrane, PC

John Allanson Allanson Insurance Agency

Steve Weil, Esq. Berding | Weil

Aaron Majors Cagwin & Dorward

Bruce Ratliff Action Property Management

Sandra Gottlieb, Esq. Swedelson Gottlieb

John Garvic, Esq. Law Office of John D. Garvic

Tyler Berding, Esq. Berding | Weil

Kerry Mazzoni Government Strategies

City: State:

Zip:

Phone:

SPONSORS

Visa/Mastercard No. Exp. Date: Signature: Return with payment to: ECHO, 1960 The Alameda, Ste 195, San Jose, CA 95126 Orders will not be processed without payment in full. Fees for cancelled registrations will not be refunded. Phone: 408-297-3246; Fax: 408-297-3517

June 2014 July 2014 | | ECHO ECHOJournal Journal

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RUNNING A SUCCESSFUL MONTHLY MEETING By Tim Polk

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hen I joined the Roundtree Homeowners Association, I did so for the usual reason of wanting a say in maintaining and improving the complex. But when I became president a year later, I had another goal in mind: to make the monthly homeowners meetingsâ&#x20AC;&#x201D;at the time running two+ hours and, in my opinion, unfocused and inefficientâ&#x20AC;&#x201D; shorter, less scattered and more productive.

July 2014 | ECHO Journal

nd the results? I’d love to say every meeting now is quick, efficient, and fun—but it’s not. We as a board still go off on tangents, get bogged down in one or more issues, even have tempers flair occasionally. But those meetings are the exception, not the norm. We’ve cut our meetings down to an average length of approximately 75 minutes, have completed numerous small projects and are planning better for the larger, longer term needs of Roundtree.

How did we do it? To reach our goal of shorter, more efficient meetings while still permitting homeowners to air views and opinions and allow the board to

discuss, debate and take action on various issues, we streamlined how and what we did. Specific suggestions I have that any board president and board can utilize or adapt to make their monthly meetings faster, better, and more productive include the following:

board of our goal of a 75-minute meeting and state, in general terms, what are the key issues to be discussed. (We normally devote each meeting to one main topic.)

Use an agenda and stick to it.

Use introductions We start every meeting by having board members state their name and board title. Homeowners, when speaking, also begin by saying their name and unit number. This helps reduce confusion and allows both board members and homeowners to have a better idea who is speaking.

Set the tone at the beginning After calling the meeting to order and having the introductions, I remind the

A lot can happen in a month’s time. Some issues are nagging, difficult, or even contentious. The president must keep the meeting moving by following the agenda, discouraging off-target discussions, and encouraging board members to keep their comments or committee reports brief.

Have each meeting focus on one main topic We as a board try to go through general business, such as committee reports, fairly quickly; then we devote the bulk of the meeting to one main issue. One month this topic might be security, another month landscaping, and so on. This allows an extended, meaningful discussion—but on one topic, not six. Also, by always having the main topic discussed last, board members are more likely to wrap up in a timely manner.

Emphasize and utilize pre-meeting reports Encourage board members to read and study the pre-meeting packet of information carefully and write down any questions. If everyone has read the same information, the resulting discussion will then be more focused and more productive.

Don’t give each topic the same emphasis or the same amount of time. As president, you must control how much time is spent discussing a topic. The following 18 echo-ca.org

are several example topics along with comments about handling each of them:

A request from a homeowner to fix a leaking roof (major problem, requires resolution). A report about a dog confined to a back patio and living in its own feces (serious problem, but board’s authority is limited; person reporting must be instructed to call local humane society). A board member asking for a volunteer to pick up her mail while she’s on vacation (minor annoyance to one person; ask that this be discussed after the meeting has been adjourned). A homeowner’s complaint that a neighbor’s car alarm occasionally goes off at night (minor annoyance unless chronic problem; acknowledge and move on).

Assign ownership immediately People are great at complaining, making suggestions and generating ideas. The real challenge, however, comes in followthrough. For every action decided on by the board (even if it is to reconsider the issue at a later date), the following must be established:

What action will be taken? Which person or group will carry out the action? By when will the action be completed? If a small group or committee is formed, I strongly recommend that one person be designated “team leader” with ultimate responsibility for the committee’s actions. July 2014 | ECHO Journal

Limit process and instead focus on results Some board members will be “process people”: they love discussing options, getting bids, debating what to do, etc. As board president, always attempt to move the board to making decisions. For example:

Discuss the many options, then reach agreement on two main options. Later, reach agreement on final solution. Put out bids one time only. Resist the temptation to put out request for bid, change some element, put out another request for bid, decide to do something else, put out another request for bid, etc..

Most board members will approve of these suggestions because they’ll appreciate the quicker, more focused meetings. It may take several meetings, but over time you will reduce the meeting length time and get more done.

Control input from homeowners Receiving feedback and suggestions from homeowners is an important part of a board of directors’ role. While valuable, however, homeowner comments can go too far, wasting time, energy and goodwill. The following five-step plan will keep homeowners’ comments focused and productive: Allow the homeowner to state his or her problem or complaint. If the owner is upset, let them vent—but just a little.

Empathize with them. Empathize means “to understand” and shows the board is concerned about the problem. Examples of empathic remarks are, “We all share those same feelings,” or “This is obviously something that must be remedied as quickly as possible.” As quickly as possible or prudent, shift the discussion off the problem and onto the solution. Ask what action the homeowner suggests should be taken. Many times this will be impossible or extremely difficult. Tell the homeowner this (and why) and suggest what the board might be able to. Then, if appropriate, discuss among the board and state exactly what action the board will take and by when. Often information will have to be collected by a board member or some professional expert. In these instances, invite the homeowner to the following meeting to discuss what has been found out. Thank the homeowner, then move on nicely but forcefully. Transitions include:

“Thank you for bringing this to our attention. We will do (a) and (b). Now, are there other homeowners’ comments?” “We appreciate your interest in this matter. We all understand how important properly maintained lawns are, and we will pass along your concerns to the gardeners. Now, are there any other landscape issues from homeowners?”

Building Repair Documents, Decks, Stairs, Settlement, Construction Defects, Expert Witnesses, Forensic Engineers, Moisture Intrusion, Investigations, Drainage, Seismic Retrofit Engineers, Soft Story Specialists.

Serving Northern & Central California Common Interests • Association Managers • Construction Managers HOA Boards • Restoration Contractors • Legal Council www.Qengineers.com • Direct: 408-583-0323 ext.813 A SUBSIDIARY OF QUILICI ENGINEERS, INC.

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Make it fun A final suggestion I’d like to make is this— try to have a little fun to reduce tension and promote camaraderie among board members. Crack a joke, bring a cartoon to share, or encourage funny comments that don’t belittle anyone. Humor reduces tensions and creates an open, honest atmosphere that will lead to more effective debate and more effective meetings. Tim Polk served as president of the 188-unit Roundtree Home Owners Association in Sunnyvale, California.

July 2014 | ECHO Journal

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A Salute To Condominium Directors By Marilyn Lincoln

Condominium owners must take into account how very important volunteer directors are.

hey are the backbone of any condominium corporation. Without these dedicated volunteers , who would oversee the growth, improvement, security and legal operations regarding your valuable investment?

During my interviews, I have discovered that several board members from other corporations have served for five years or more. Many have expressed some real concerns, such as who would fill their position if they were to resign, become ill or sell their unit? Unfortunately, in many condominium communities, owners are not eager and have no desire to step forward as volunteer directors. Many have informed me that they do not relish the thought of accepting such enormous responsibilities.

July 2014 | ECHO Journal

he week of Thanksgiving, I received a call from my mother. She was very concerned after hearing that her President Director was prepared to resign. This director was very tired of receiving constant negative feedback and rude outbursts from certain owners, every time he had to enforce a rule. No one should have to put up with this type of flack—especially while enforcing rules for the safety and security of others. However, directors sometimes have no choice but to be prepared for the irate rule breakers who argue and, in some instances, refuse to admit any wrongdoing.

I feel that current board members should set up a trial system to help enlighten owners. Owners

should experience the positive as well as the negative aspects of being a director. For at least six months allow one owner to volunteer to sit in on all board meetings, etc. This person would have an excellent learning opportunity to experience all the operations of a board member, as an observer. Of course remember that this sit-in volunteer cannot be privy to any confidential or legal issues concerning other unit owners. Explain to them why they cannot be included in these matters and must be excused for those portions of the meeting. After the six-month period, give another owner the opportunity. One at a time owners would come away from this experience with a much better understanding and appreciation of how difficult this job really is. Some may even decide to run as a director in the next election.

I inquired as to what recognition or support my mother’s directors

H I salute each and every one of the volunteers in all communities and I hope that you are given the appreciation that you deserve.

H had ever received. She indicated to me that the board goes out for dinner, once a year, paid for by the corporation. By support or recognition, I did not mean a complimentary dinner. I inquired if any of the residents had ever taken the time to send a letter or card, signed by all the owners to thank these volunteers for their hard work. It is so important that volunteers are appreciated. Owners should not wait until directors are at the end of their rope and are prepared to resign, before they finally decide to acknowledge the boards’ past and current achievements. I have interviewed several directors and most have told me “Being a director is a thankless job, but someone has to do it.” My mother wrote a beautiful letter to thank all the volunteers. She passed it around the entire community and had all the owners read and sign it in support of their directors. At the association Thanksgiving dinner, that letter was read and presented to the board. They were totally surprised and overwhelmed by such kind words and appreciation. It clearly confirmed to all of them that they are very valuable assets to all in their community. Needless to say, no one resigned. I salute each and every one of the volunteers in all communities and I hope that you are given the appreciation that you deserve.

Marilyn Lincoln has 26 years experience in condominium management in Ontario, Canada. She is a a member of the Canadian Condominium Institute. 24 echo-ca.org

ECHO honor roll

ECHO HONORS VOLUNTEERS Resource Panels

Seminar Speakers

Recent Contributing Authors

Accountant Panel Marco Lara, CPA 650-632-4211

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

December 2013 Sandra M. Bonato, Esq. Katherine Naegele Derek Eckert Ann Rankin, Esq. Burt Dean

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 Judy O’Shaughnessy 408-839-6926 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.

Santa Cruz John Allanson Jeffrey Barnett, Esq. Diane Rossi, PCAM Ron Duncan Toby Goddard Piret Harmon South Bay Sharon Pratt, Esq. Rosalia Tapia, Esq. Matthew Harrington, Esq. Terin Reeder Robert P. Hall, Jr., Esq. Stephanie Hayes, Esq. Wine Country Carra Clampitt Bill Gillis, Esq. Steve Lieurance, CCAM Jim MacMillan Michael Cantarutti Paul Schultz, CLCA. Oakland David Levy, CPA Ian Brown, CCAM Mike Hughes, Esq, Dennis Socher Wanden Treanor, Esq. Gavin Leonard Alex Noland, Esq. Dave Rosenblatt, CACM Ricky Chu Paul Windust, Esq. Chris Sigler Toni Rodriguez Scott Sommerfield Sandra Gottlieb, Esq. Steve Weil, Esq. Amy Tinetti, Esq. Bob Burton, CCAM John Stander, Esq. Jordan O’Brien, Esq. Beth Grimm, Esq. Ann Rankin, Esq.

January 2014 Douglas Christison, PCAM Barbara Ellen William S. Erlanger, CPA Joelyn K. Carr-Fingerle, CPA Tyler P. Berding, JD, PhD February 2014 Jeffrey A. Barnett, Esq. David Kuivanen, AIA Elizabeth Lanham Sharon Glenn Pratt, Esq. March 2014 Teresa Powell & Brian Seifert Sandra L. Gottlieb, Esq. Marc Dunia Charlotte Allen April 2014 Thomas Connelly Burt Dean Walt Grady, CPA Andrea L. O’Toole, Esq. Emily K. Clark, Esq. Michael Hardy, Esq. May 2014 Scott Sommerfeld Pat Wendleton, Esq. Sharon Glenn Pratt, Esq. Glenn H. Youngling, Esq. Ken Bade, PCAM June 2014 Steven S. Weil, Esq. David Kuivanen, AIA Beth Grimm, Esq. Robert Hall, Esq. Barrett R.P. Schaefer, Esq.

July 2014 | ECHO Journal

26 echo-ca.org

IT STARTS WITH US Common Interest Developments are in a unique position to have an enormous impact on water conservation By Jeffrey S. Farnsworth, CCAM

fforts to increase water use efficiency in California had come to the forefront as early as 1990 with Assembly Bill 325, the Water Conservation in Landscaping Act. This bill required the Department of Water Resources to appoint an advisory task force in order to draft a model for a water efficient landscape ordinance that local agencies would have to adopt by January 1, 2010 if they had not developed their own qualified ordinance by that time.

July 2014 | ECHO Journal

n 2009, common interest developments were being affected and ultimately asked to help in the Stateâ&#x20AC;&#x2122;s efforts to conserve water by Governor Schwarzenegger signing Assembly Bill 1061 which modified Section 1353.8 of the Davis Stirling Act to read:

1358.8. Notwithstanding any other law, a provision of any of the governing documents of a common interest development shall be void and unenforceable if it does any of the following:

a. Prohibits, or includes conditions that have the effect of prohibiting, the use of low water-using plants as a group. b. Has the effect of prohibiting or restricting compliance with either of the following: i. A water-efficient landscape ordinance adopted or in effect pursuant to subdivision (c) of Section 65595 of the Government Code. ii. Any regulation or restriction on the use of water adopted pursuant to Section 353 or 375 of the Water Code.

On January 17th of this year, Governor Brown declared a state-wide drought, asking for a

20% cutback in water use for everyone in California. Water utility companies

are already expected to cutback 10% by 2015 and then 20% by 2020. Although penalties for non-compliance enforced by the State are somewhat vague, we can only assume that if threatened, local agencies will begin enforcing penalties, surcharges, or tiered water rates for excessive use. This will no doubt affect all of us and the communities we live in.

Common Interest Developments are in a unique position to have an enormous impact on water conservation. In some areas, 50% or more of the water we use daily is used to aid lawns and outdoor landscaping. Weâ&#x20AC;&#x2122;ve all seen the early morning cycle where the runoff makes the concrete look wetter than the grass, or found those pesky sprinkler heads that have been turned away from the intended landscape. However, largescale landscape renovation can be expensive, and if your association is not already budgeting for this, the financial impact to the membership could be startling.

So where do we start? Communication and education is the best place to begin. There are

many websites that offer information on conservation and even water use calculators that can help you gain an understanding of your current use. There are Return on Investment (ROI) calculators that can show you how long it will take for the savings from your modifications to offset the expenses for making these changes. However, before you lose yourself in the land of online search engines, try asking your landscapers how much water your landscaping really needs in order to thrive. These conservation experts can be a tremendous resource for you and observe your water system on a weekly if not daily basis. If you are on a well, ask your maintenance experts to give you an idea of the current level of the natural aquifers you are pulling resources from. Many will recommend annual inspections to ensure the maximization of pressure and the continued availability of this natural (and still limited) supply.

28 echo-ca.org

Although penalties for overconsumption of water have not been related on a local level,

the State has clearly stated penalties to the water utility companies that provide access for domestic use. If these companies cannot meet the Stateâ&#x20AC;&#x2122;s goals, we will most likely see heightened cost structures based on tiered use and possibly penalties for exceeding what they determine to be acceptable amounts of use. It is important to realize that not all water abuse is related to landscaping, and that we can also make a huge impact as individuals.

For example, have you ever brushed your teeth and left the faucet running while you stand there staring at yourself scrubbing away?

Or while you are rinsing off the dinner dishes, have you had to stop and chase your three year old across the room to take that spoon from his hand, leaving the water pointlessly rushing into the sink? Simply remaining conscious of every day habits and trying to turn the water off in between use can be influential in terms of conservation. Taking shorter showers can also help and some people Iâ&#x20AC;&#x2122;ve spoken to actually place buckets in their shower to collect the water as it warms up, in order to use for watering their indoor and outdoor plants or to for washing their cars.

Educating your fellow neighbors is the first step. You will be surprised

at how many others in your community want to contribute. Spread the word through the use of community websites and newsletters and share ideas and links to resources in your community. Ask for ideas from other members in your association. Together, we can make a positive impact on conserving this precious natural resource. Community first! It truly starts with us.

Jeffrey S. Farnsworth, CCAM, is president of Steward Property Services in Petaluma. He is an ECHO member and a regular participant on the ECHO North Bay Resource Panel and Wine Country Resource Panel.

July 2014 | ECHO Journal

WE WON THE CASE: By Paul W. Windust, Esq.

30 echo-ca.org

BUT NOW WHAT???

July 2014 | ECHO Journal

rom time to time, a community association is forced to sue a member who has violated the governing documents. Many times, these lawsuits are “settled” without trial. Sometimes however, a trial must be held to determine whether and to what extent the association can obtain enforcement of the architectural or other “use” provisions of the governing documents, especially the CC&Rs. This article addresses enforcement of judgments whether obtained by “default”—where the other party does not contest the lawsuit—or following a trial by jury or the court.

A judgment arising out of a governing document violation almost always includes an “injunction” (sometimes called “injunctive relief ” or, simply, a “court order”), which is a court “command” that requires the owner either to do something (restore property to its pre altered condition) or to stop doing something (operating a business in his home). Sometimes a judgment will permit the association to enter a member’s property or even the inside of his home if the owner fails voluntarily to cure the violation within the time stated in the judgment. For instance, in the case of a member’s unapproved addition of a second story balcony, the judgment should contain a provision that allows the association to enter upon the member’s property to remove the balcony whether the owner allows access or not. Finally, the judgment usually includes an award of attorneys’ fees and costs incurred by the association in enforcing the CC&Rs, rules, regulations, or architectural standards as permitted by Civil Code Section 5975 and most CC&Rs. The judgment should also include

language allowing the association to record liens to recover all sums awarded or expended to enforce the judgment (such as the contractor fees to remove the balcony or legal fees and costs). In certain circumstances, it may be unfeasible or dangerous for the association to enter upon the member’s property or unit to achieve compliance with the judgment, and such access should never be undertaken lightly or without the advice of counsel. In that case, the association may be faced with the problem of a member’s ignoring the court’s judgment by continuing the offending behavior or refusing to remove the unapproved alteration. Aside from “self help,” a judgment can be enforced with further judicial assistance. The usual way to force a member to comply with the injunctive relief portion of a judgment or court order is to have the member held in contempt of court. A contempt proceeding is like a criminal trial. The party seeking the contempt citation must prove beyond a reasonable doubt that

1 2

the judgment or order violated is valid;

the respondent or member has the ability to comply with the judgment or order;

the respondent or member has willfully disobeyed the judgment or order.

the respondent or member has actual knowledge of the judgment or order;

The remedy for contempt is either a monetary sanction, imprisonment, or both. A contempt proceeding begins with an application to the court that issued the judgment or order for an Order to Show Cause why the member should not be held in contempt. The association needs to show with evidence that the judgment was served on the member and

32 echo-ca.org

that the member has not complied with the terms of judgment or order. Usually, a sufficient showing can be made by a declaration by the association’s manager or a board member that the judgment was served on the member and that the member continues to engage in the offending behavior or has failed to remove the unapproved alteration. The application must be served on the member with enough time for the member to prepare a response. The court then holds a hearing to determine whether enough evidence has been put forth to hold a contempt hearing. If the association has made a sufficient showing at the Order to Show Cause hearing, the court then sets a contempt hearing. A contempt hearing is a quasi criminal proceeding at which the court will take evidence, either orally or in writing, concerning the member’s failure to abide by the judgment or order. The association is required to prove beyond a reasonable doubt that the member has willfully violated the judgment by continuing the offending behavior or failing to remove the unapproved

alteration. If the association meets its burden of proof, the court will hold the member in contempt of court and either issue a “body attachment” or a monetary sanction, or both. A “body attachment” is essentially an arrest warrant that directs the county sheriff to take the member into custody until such time as the member complies with the judgment or order. A monetary sanction may include an award of attorneys’ fees incurred by the association in obtaining the contempt citation and an amount to punish the non-compliant member. The member is released from the contempt citation only after he or she has complied with the terms of the judgment or order. Even if the member complies with the injunctive relief portion of a judgment, an association may be faced with the problem of collecting the money portion of the judgment. A money judgment can be issued for attorneys’ fees, damages, and even unpaid assessments. An association has several options available to it to collect a money judgment if the member does not voluntarily pay it. First, the association may record the judgment

in the county in which the member owns real property. Recording the judgment creates a judgment lien against all real property owned by the member in the county. In addition, the judgment lien attaches to all real property acquired by the member after the judgment lien is recorded. If the member transfers the real property to another person, the acquiring person takes the real property subject to the judgment lien. If the member decides to sell real property subject to the judgment lien, he or she must pay it off in order to convey good title to the buyer. In addition, lenders will require that a judgment then be paid off if a member decides to refinance real property subject to a judgment lien. An association may also foreclose on its judgment lien if it does not want to wait until the affected real property is sold, refinanced, or if the member will not pay it voluntarily. In this process, the association applies to the court for a writ of execution and directs the sheriff in the county where the real property is located to sell the real property to satisfy the judgment lien. Once the sheriff receives

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July 2014 | ECHO Journal

the writ of execution and the applicable levy fee, the sheriff will serve the writ of execution on the member, any tenants, and post it on the applicable real property. This process is called a levy. The sheriff will then notify all parties that have an interest in the real property of the execution proceeding or levy. After serving and posting the writ of execution and providing all interested parties with notice of the levy, the association must wait 120 days before giving notice of the sale. This waiting period is designed to provide the member with enough time to pay the judgment lien before the real property is sold. If the real property to be sold is a dwelling (i.e., someone lives in it), the association will have to apply to the court for permission to sell it. The court will hold a hearing to determine whether there is enough equity in the property to satisfy the judgment lien after deducting the amount of any senior liens and the member’s statutory homeowner’s exemption. If the court finds that the real property is the member’s dwelling and that there is

sufficient equity to satisfy the judgment lien, it will order the real property sold. If the court finds that the real property is the member’s dwelling and that there is not sufficient equity to satisfy the judgment lien, the court will not allow the real property to be sold, effectively halting the levy process. Real property that does not serve as the member’s primary residence will be ordered sold even if there is not enough equity to satisfy the judgment lien. Therefore, it is important that the association obtain lien and market information respecting the real property before it begins the foreclosure process. This information can be obtained by purchasing a preliminary title report respecting the real property to obtain lien information and consulting with real estate professionals to obtain market information. After 120 days have elapsed and the order for sale is obtained, the sheriff will set a sale date. The sheriff is required to publish the notice of sale and set the sale date at least 20 days in the future. The sale is conducted like a foreclosure sale where title is awarded to the highest

bidder. The association need not have cash on hand as it may credit bid the amount of its judgment. The winning bidder takes title to the real property subject to all liens senior to the lien under which the sale was conducted. In the vast majority of cases, the member will satisfy the judgment lien to avoid losing his or her real property. Judgment creditor sales are unique. The sale is conducted by a sheriff under court order and the sale is absolute, which means that the debtor cannot undo the sale by paying the judgment after the sale takes place. Finally, the sale process is governed by the Enforcement of Judgments Act, a series of special laws intended to clarify debtor and creditor rights regarding collection of judgments. To use this process, a creditor simply files a collection lawsuit in the appropriate court (small claims court is fine). Once it obtains a money judgment, it begins the execution sale process described above. To hold the sale, the only requirement is that the real property has sufficient equity to pay off the lien.

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A creditor that does not want to undertake the time and expense of a foreclosure sale may collect the monetary portion of its judgment like any other money judgment. For example, the debtor’s bank account can be “attached” or his/her wages garnished. Successful litigants are surprised to learn that obtaining a judgment which contains injunctive and monetary relief does not guarantee immediate recovery of money or compliance with court orders. A judgment is simply an order from a court that a member refrain from certain behavior or compels certain action. It is not self executing. Accordingly, the “winner” will still have to undertake judgment enforcement proceedings to ensure that a judgment awarded in its favor is complied with. The procedures discussed above are designed to achieve judgment compliance. Paul Windust, Esq., is a principal with Berding & Weil in Walnut Creek. Paul is a regular contributor of content and presentations for ECHO.

July 2014 | ECHO Journal

Beyond Privatopia Member Price: Non-Member Price:

The Board’s Dilemma $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, frm state oversight to laissez-faire libertarianism.

Condominium Bluebook 2014 Edition Member Price: Non-Member Price:

$17.00 $25.00

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.

Member Price: Non-Member Price:

$10.00 $15.00

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.

2014 Condominium Greenbook Member Price: Non-Member Price:

$17.00 $25.00

This companion to the Condominium Bluebook 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.

Condos, Townhomes and Homeowner Associations

Questions & Answers About Community Associations

Member Price: Non-Member Price:

$29.00 $45.00

$18.00 $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.

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.

Community Association Statute Book—2014 Edition

Board Member Handbook

Member Price: Non-Member Price:

$15.00 $25.00

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.

Home and Condo Defects Member Price: Non-Member Price:

$12.95 $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.

Member Price: Non-Member Price:

$15.00 $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.

Reserve Fund Essentials Member Price: Non-Member Price:

$18.00 $25.00

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.

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

$15.00 $20.00

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.

36 echo-ca.org

ciation o s s A unity Book Comm Statute dition 2014 E

Dispute Resolution in Homeowner Associations Member Price: Non-Member Price:

$15.00 $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 www.echo-ca.org

Bookstore Order Form Board Memberâ&#x20AC;&#x2122;s Guide for Contractor Interviews Member Price: Non-Member Price:

EDUCATIONAL COMMUNITY FOR HOMEOWNERS 1960 THE ALAMEDA, STE 195, SAN JOSE, CA 95126 PHONE: 408-297-3246, FAX: 408-297-3517

TITLE

QUANTITY AMOUNT

$15.00 $25.00

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

Yes! Place my order for the items above. Check

Board Memberâ&#x20AC;&#x2122;s Guide for Management Interviews Member Price: Non-Member Price:

$15.00 $25.00

This guide for use by boards for conducting complete and effective interviews with prosp ective managers takes the guesswork out of the interview process. Over 80 questions covering every management duty and includes answer sheets matched to the questions.

Visa

MasterCard

Credit Card Number Exp. Date

Signature

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

State

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Daytime Telephone

July 2014 | ECHO Journal

directory updates

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

New Members Teevan 2247 Union Street San Francisco, CA 94123 Contact: Jesse Ladomirak Tel: (415) 474.TVAN GET Insurance Services and Associates 1060 Willow St. San Jose, CA 95125 Contact: Tom Gurske Tel: (408) 279.7171

Law Offices of Barrett R. P. Schaefer 790 Mission Ave. San Rafael, CA 94901 Contact: Barrett Schaefer, Esq. Tel: (415) 485.2200 R& R Handyman Services 1966 Tice Valley Blvd. Walnut Creek, CA 94595 Contact: Todd Rowe Tel: (866) 377.0003 Boland Insurance, Inc. 120 D Oliva Court Novato, CA 94947 Contact: Kevin Boland Tel: (415) 898.4370

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

advertiser index

about ECHO

ACE Property Management.................11 www.acepm.net

GET Insurance......................................21 www.hoacoverage.com

Applied Reserve Analysis....................33 www.ara-llc.com

Medallion Landscape...........................29 www.mlmi.com

A.S.A.P. Collection Services.................21 www.asapcollect.com

Mutual of Omaha Bank.......................33 www.mutualofomahabank.com

Association Reserves...........................11 www.reservestudy.com

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

Benjamin Moore Paint & Company...29 www.benjaminmoore.com Berding|Weil .........................Back Cover www.berding-weil.com

Neighborhood Association Management.........................................13 www.neighborhoodam.com

Collins Management............................20 www.collins-mgmt.com

PML Management................................19 www.pmlmanagement.com

Compass Management Group............32 www.gocompass.com

Pollard Unlimited.................................13 www.pollardunlimited@comcast.net

Cornerstone Community Management.........................................24 www.cornerstonemgt.biz

R.E. Broocker Co...................................21 www.rebroockerco.com

Ekim Painting.......................................19 www.ekimpainting.com

Rebello’s Towing..................................35 www.rebellos.net

Eugene Burger Management..............38 www.ebmc.com

Silicon Valley Civil & Structural Engineers..............................................20 www.Qengineers.com

Focus Business Bank...........................28 Focusbusinessbank.com

Steve Tingley Painting, Inc..................34 www.tingleypainting.com

Flores Painting & Drywall....................11

The Manor Association........................21 info@TheManorAssociation.com

Forster Construction Management.....18 Forster_CM@yahoo.com

Union Bank...........................................12 www.HOAbankers.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 HOA 2 to 25 units...........................$130 HOA 26 to 50 units.........................$180 HOA 51 to 100 units.......................$275 HOA 101 to 150 units.....................$375 HOA 151 to 200 units.....................$450 HOA 201 or more units..................$575 Professional Membership.................$499 Association Management Membership.......................................$499 Individual Membership.......................$75

How Do You Join ECHO?

Office 1960 The Alameda, Suite 195 San Jose, CA 95126-2308

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.

August 2013 ||| ECHO ECHOJournal Journal February 2014 ECHO Journal July 2014

39 39

legislation at a glimpse

The legislative session isn’t over, and we may need your help. Make sure your voice is heard in Sacramento. June was a busy month for ECHO and Sacramento legislators. Major modifications to several bills, including AB 1738 concerning attorneys at dispute resolution, are still being considered. Sometimes your legislators need to hear from you. We’ll email our members when the time comes, so make sure that we can reach you. Send your name, the name of your association, and email address to newaccount@echo-ca.org. Thank you for supporting our efforts to improve legislation for your HOA!

Current Legislation Bill Information

Summary

AB 968

Common Area Maintenance

Support

ECHO is sponsoring legislation to clarify who maintains and repairs “exclusive use common area” in associations. Current law is ambiguous about responsibility for repair and replacement, which has caused terrible building practices and unnecessary litigation. This bill will clarify that the association is responsible for repair and replacement of “exclusive use common area” unless the association’s governing documents provide otherwise.

Author: Gordon Status: Amended 5/27. In Senate Transportation & Housing Committee.

AB 1360

Electronic Voting

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. The bill also sets forth minimum requirements of an electronic voting system for an association’s election.

Author: Torres Status: Amended 6/15. Passed Assembly. In Senate Judiciary Committee.

AB 1738

Attorneys at Dispute Resolution

Support if Amended

This bill would require that association dispute resolution procedures, including internal dispute resolution (IDR), permit both the association and members to include their attorney (or another person) to participate in the proceeding if advance written notice is provided. Agreements reached in Dispute Resolution proceedings would be judicially enforceable.

Author: Chau Status: Amended 6/16. Passed Assembly. Senate Third Reading.

What Do You Think? Read more about HOA legislation on our website or visit our Facebook page and join the discussion. On the web: echo-ca.org/hoa-advocacy, On Facebook: facebook.com/echoorg

40 echo-ca.org

legislation at a glimpse

Current Legislation Bill Information

Summary

AB 2100

Drought and Under-Watering Fines

Support

This bill would prohibit an association from imposing a fine or assessment against a member for reducing or eliminating watering of vegetation or lawns during a declared emergency due to drought. Associations may require that landscaping be safe and otherwise maintained. The bill would take effect immediately.

Author: Campos Status: Amended 6/10. Passed Assembly. Senate Third Reading.

AB 2188

Solar Energy Permits

Support if Amended

This bill would expedite permits for solar panel installations. This bill would require boards to decide on applications for solar panel installations within 45 days and to notify the applicant in writing.

Author: Muratsuchi Status: Amended 6/18. In Senate Governance & Finance Committee.

AB 2430

HOA Transfer Fees and Disclosures

Watch

This bill would require that a seller provide a prospective purchaser with certain current documents that the seller possesses free of charge. It would also require that the seller be responsible for compensating an association, person, or entity for providing documents under these provisions.

Author: Maienschein Status: Amended 5/7. Passed Assembly. Senate Third Reading.

AB 2561

Voiding HOA Landscaping Rules

Neutral

This bill would require associations to permit personal agriculture in a unit owner’s private back yard, subject to reasonable restrictions. ECHO opposed an earlier version of this bill that prevented such reasonable restrictions, and allowed owners to plant in front yards as well.

Author: Bradford Status: Amended 5/28. Assembly third reading.

AB 2565

Electric Vehicle Stations

Support

Subject to certain conditions, this bill would compel a lessor in a common interest development to permit a lessee to install an electric vehicle charging station, provided the lessee agrees in writing to various requirements related to costs, insurance, and potential damages.

Author: Muratsuchi Status: Amended 6/16. Passed Assembly. In Senate Judiciary.

SB 391

Fees on Recorded Documents

Oppose

In order to fund affordable housing, this bill would impose a $75 fee on each document to be recorded in California.

Author: DeSaulnier Status: Passed Senate. In Assembly Appropriations Committee.

SB 992

Drought and Under-Watering Fines

Support

This bill would prohibit an association from imposing a fine for reducing or eliminating watering of vegetation during a declared state of emergency due to drought.

Author: Nielsen Status: Amended 5/28. Passed Senate. Assembly Third Reading.

SB 1026

Foreclosure Action Notice

Watch

This bill would permit an association to serve an owner or owner’s representative with notice of a foreclosure action to collect delinquent assessments by posting a copy of the notice on the owner’s separate interest in a manner most likely to give actual notice to the party to be served and mailing a copy of the notice, as specified.

Author: Vidak Status: Amended 4/28. In Senate Judiciary.

July 2014 | ECHO Journal

ECHO event calendar

RESOURCE PANEL CALENDAR ECHO Resource Panels meet during lunch on weekdays to enable managers, professionals and board members to hear about important topics presented by experts in the industry, and share experiences and issues. The meetings are open to all ECHO members, and those interested in learning about ECHO, offered in a casual atmosphere where the cost of attendance is the price of your lunch. The sessions last about an hour and a half. Check-in with the ECHO Panel Secretary for details and to register.

Please join us: DATE

PANEL LOGISTICS

PANEL SECRETARY

TOPIC

July 8, 11:45 a.m.

Central Coast Resource Panel Michael’s on Main 2591 S Main St., Soquel

Ann Thomas 800-537-4098 ext.7530

An architect’s perspective about building in Santa Cruz

August 13, 11:45 a.m. South Bay Resource Panel Buca Di Beppo 1875 S. Bascom Ave, Campbell

Rosalia Tapia, Esq. 408-369-0800, ext. 205

Insurance

Cindy Wall, PCAM 925-830-4580

Trees

Pam Marsh 415-686-9342

Managers’ Expectations of Vendors

August 15, 11:45 a.m.

East Bay Resource Panel Massimo Restaurant 1603 Locust St., Walnut Creek

August 20, 11:45 a.m. Wine Country Resource Panel Serv-Pro 377 Blodgett St., Cotati Sept. 4, 11:45 a.m.

North Bay Resource Panel Contempo Marin Clubhouse 400 Yosemite Dr., San Rafael

Denise Wolford 415-458-3537

Cyber Theft

Sept. 9, 11:45 a.m.

Central Coast Resource Panel Michael’s on Main 2591 S Main St., Soquel

Ann Thomas 800-537-4098 ext.7530

TBD

Sept. 17, 11:45 a.m.

Wine Country Resource Panel Serv-Pro 377 Blodgett St., Cotati

Pam Marsh 415-686-9342

Water Damage

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

42 echo-ca.org

Nominating Committee Seeks Candidates for ECHO Board of Directors

he Nominating Committee for the ECHO Board of Directors is seeking expressions of interest from persons who are interested in serving on the ECHO Board of Directors. Four positions on the board will be up for election at the ECHO Annual Meeting that will be held in November. These positions are for three-year terms. Current directors whose terms expire in 2014 are Robert Rosenberg, Diane Rossi, Brian Seifert, and Kurtis Shenefiel.

Board members are expected to attend four three-hour board meetings held each year, generally at the ECHO office in San Jose. Each board member also serves on one or more committees that hold regular meetings

throughout the year. In addition board members are expected to attend the Annual Meeting and a two-day board retreat each November. Board members receive no reimbursement for these activities. Nominees must also be members of ECHO, either through their homeowners association or business and have thorough familiarity with the organization and the CID industry. Persons interested in being considered for nomination should obtain and complete a nomination and qualifications form, available by request from the ECHO office. Every potential candidate, including incumbents, must submit a full form. All completed forms must be submitted to the ECHO office no later than July 24, 2014 , to be considered by the nominating committee. Those requesting nomination may be requested to interview with the nominating committee. The committee will meet in late July to prepare recommendations for board consideration. July 2014 | ECHO Journal