Current through Register 2024 Notice Reg. No. 38, September 20, 2024
(a) The powers and duties of the governing body of
the Association shall normally include, but shall not be limited to, the following:
(1) Enforcement of applicable provisions of the
Covenants, Conditions and Restrictions, Articles, Bylaws and other instruments for
the ownership, management and control of the subdivision.
(2) Payment of taxes and assessments which are, or
could become, a lien on the common area or a portion thereof.
(3) Contracting for casualty, liability and other
insurance on behalf of the Association.
(4) Contracting for goods and/or services for the
common areas, facilities and interests or for the Association subject to the
limitations set forth below.
(5)
Delegation of its powers to committees, officers or employees of the Association as
expressly authorized by the governing instruments.
(6) Preparation of budgets and financial
statements for the Association as prescribed in the governing instruments.
(7) Formulation of rules of operation of the
common areas and facilities owned or controlled by the Association.
(8) Initiation and execution of disciplinary
proceedings against members of the Association for violations of provisions of the
governing instruments in accordance with procedures set forth in the governing
instruments.
(9) Entering upon any
privately-owned subdivision interest as necessary in connection with construction,
maintenance or emergency repair for the benefit of the common area or the owners in
common.
(10) Election of officers of the
governing body.
(11) Filling of
vacancies on the governing body except for a vacancy created by the removal of a
governing body member.
(b) The
governing body of the Association shall ordinarily be prohibited from taking any of
the following actions, except with the assent, by vote at a meeting of the
Association or by written ballot without a meeting pursuant to Corporations Code
Section
7513, of a
simple majority of the members, other than the subdivider, constituting a quorum
consisting of more than 50 percent of the voting power of the Association residing
in members other than the subdivider:
(1) Entering
into a contract with a third person wherein the third person will furnish goods or
services for the common area or the owners' Association for a term longer than one
year with the following exceptions:
(A) A
management contract, the terms of which have been approved by the Federal Housing
Administration or Veterans Administration.
(B) A contract with a public utility company if
the rates charged for the materials or services are regulated by the Public
Utilities Commission provided, however, that the term of the contract shall not
exceed the shortest term for which the supplier will contract at the regulated
rate.
(C) Prepaid casualty and/or
liability insurance policies of not to exceed three years duration provided that the
policy permits short rate cancellation by the insured.
(D) Lease agreements for laundry room fixtures and
equipment of not to exceed five years duration provided that the lessor under the
agreement is not an entity in which the subdivider has a direct or indirect
ownership interest of 10 percent or more.
(E) Agreements for cable television services and
equipment or satellite dish television services and equipment of not to exceed five
years duration provided that the supplier is not an entity in which the subdivider
has a direct or indirect ownership interest of 10 percent or more.
(F) Agreements for sale or lease of burglar alarm
and fire alarm equipment, installation and services of not to exceed five years
duration provided that the supplier or suppliers are not entities in which the
subdivider has a direct or indirect ownership interest of 10 percent or
more.
(G) A contract for a term not to
exceed three years that is terminable by the Association after no longer than one
year without cause, penalty, or other obligation upon ninety (90) days written
notice of termination to the other party.
(2) Incurring aggregate expenditures for capital
improvements to the common area in any fiscal year in excess of 5% of the budgeted
gross expenses of the Association for that fiscal year.
(3) Selling during any fiscal year property of the
Association having an aggregate fair market value greater than 5% of the budgeted
gross expenses of the Association for that fiscal year.
(4) Paying compensation to members of the
governing body or to officers of the Association for services performed in the
conduct of the Association's business provided, however, that the governing body may
cause a member or officer to be reimbursed for expenses incurred in carrying on the
business of the Association.
(5) In the
case of a limited equity housing cooperative, using the corporate equity for any
purpose permitted under Section
33007.5(d)(1)
of the Health and Safety Code without the vote or written consent of a bare majority
of the stock or membership interests of resident owners.
1. New section
filed 1-16-76; effective thirtieth day thereafter (Register 76, No.
3).
2. Amendment filed 1-17-80; effective thirtieth day thereafter
(Register 80, No. 3).
3. New subsection (b)(6) filed 7-9-80; effective
thirtieth day thereafter (Register 80, No. 28).
4. Amendment of
subsections (a)(1) and (b)(1) filed 12-1-81; designated effective 1-1-82 (Register
81, No. 49).
5. Amendment filed 7-1-83; effective thirtieth day
thereafter (Register 83, No. 30).
6. New subsection (b)(1)(E) filed
1-9-85; effective thirtieth day thereafter (Register 85, No. 2).
7.
Amendment of subsection (b)(1)(E) filed 4-2-86; effective thirtieth day thereafter
(Register 86, No. 14).
8. New subsection (b)(1)(F) filed 12-30-86;
effective thirtieth day thereafter (Register 87, No. 1).
9. Amendment of
subsection (b), new subsections (b)(1)(G) and (c)-(d)(2) and amendment of NOTE filed
12-7-94; operative 1-6-95 (Register 94, No. 49).
10. New subsection (e)
filed 11-27-96; operative 12-27-96 (Register 96, No. 48).
11. Repealer of
subsections (c)-(e) filed 6-15-98; operative 7-15-98 (Register 98, No.
25).
Note: Authority cited: Section
11001,
Business and Professions Code. Reference: Section
11018.5,
Business and Professions Code; and Sections
1354 and
1355, Civil
Code.
