NEW LAWS FOR RESIDENTIAL ASSOCIATIONS

December 31, 2024

31 USC 5336 – Corporate Transparency Act Registration is NOW OPTIONAL?

The Corporate Transparency Act (“CTA”) was enacted in 2021 to combat tax fraud, money laundering and terrorism financing.  Under the CTA, each community association must file a Beneficial Ownership Information Report (“BOIR”) with the U.S. Department of Treasury’s Financial Crimes Enforcement Network (“FinCEN”) providing the identity of its directors.[1] Legal wrangling continues.[2]  As of December 27, 2024, with the decision by the Fifth Circuit Court of Appeals to vacate the stay on the injunction (thus, reinstating the nationwide injunction), FinCEN has updated their website to say that BOIR submissions are voluntary stating “in light of a recent federal court order, reporting companies are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force.” We think it’s easier just to register.

What Happens If A Director Refuses To Register? Assuming that BOIR submissions become required again, ridiculous FinCEN-imposed penalties include $591 per day (civil) and $10,000 and up to 2 years in prison (criminal).  Fines could be levied against the association or the directors individually. However, since the association entity cannot serve prison time, the individual beneficial owners deemed to have willfully caused noncompliance for failure to report complete and updated information may serve prison time. 

Begin By Each Director Obtaining Their Own FinCEN Identifier.  Most of our industry agrees that each director of a community association is a beneficial owner because any majority of directors “exercise substantial control over the reporting company.” Developer/Declarants who own 25% or more of the separate interests are beneficial owners. Because not all directors feel comfortable providing their driver’s license to the association, and because we don’t want the association in possession of personal information, each director should be required to obtain their own FinCEN number.

STEP 1: Directors: (1) Take a photo of the front of your driver’s license or passport and save it to your desktop. Social security numbers, email addresses and phone numbers are not required. (2) Log into: https://boiefiling.fincen.gov and complete the questionnaire. In less than 10 minutes, each director will be provided a unique FinCEN Identifier. (3) Provide that to your treasurer, who will undertake STEP 2. 

STEP 2: Treasurers: (1) Have ready the precise legal name of the association; any trade names or d/b/a names; (2) the physical address of the principal place of business;[3] (3) jurisdiction of formation (California); (4) the association’s tax ID number, and (5) each director’s unique FinCEN Identifier. Then log into: https://boiefiling.fincen.gov and complete the questionnaire. In less than 15 minutes, the association will be registered.

The BOIR Needs To Be Regularly Updated!  Associations have an ongoing duty to update information within 30 days of a change.  Unfortunately, community associations will likely engage in submitting updates more frequently than other types of corporate entities by virtue of annual elections.  Other changes will trigger the need for updates including, but not limited to, drivers license or passport changes, residential address changes, name changes, etc.  There currently is no option to update the BOIR and all reporting company and beneficial owner information will need to be submitted again for each update.

Governing Document Policies? Consider putting in place mechanisms to require and remind directors to comply with reporting requirements. Amend the Election Rules and candidate nomination forms to notify candidates of the CTA reporting requirements.   Adopt or revise your Code of Ethics to require cooperation of directors with the CTA and other similar reporting requirements. 

Treasurers and Managers:  If you hit a snag, or are not comfortable doing this on your own, we will help you and your clients. Contact our firm to set up a zoom and we will coach you through the registration process for $375.

AB 2114 – Balcony Inspections Due December 31, 2024:  We’ve been talking about this “Balcony Bill” since a Berkeley CA balcony collapse resulted in the death of six students and injuries to seven others. Enacted in 2020, Civil Code § 5551 requires inspection and certification of “exterior elevated elements” (decks, balconies, stairs, walkways, etc.) in condominium buildings with 3 or more units.  Previously, inspections could only be performed by licensed architects or structural engineers. AB 2114 adds licensed civil engineers as possible inspectors.

For communities who have performed these inspections and generated the required report, be sure to get that information to your reserve analyst for integration into your reserve report. For communities who have not performed the inspections, FHA and VA (“conventional”) loans are no longer available, often leading to units being sold at a severe discount.  If you are attempting to sell your unit in this situation, locate and arrange private lenders who, though at a higher interest rate, will finance the sale.  

AB 2159 – Electronic Voting Now Optional:  For many years, our industry has championed legislation allowing electronic voting. Following the pandemic, the legislature accepted electronic meetings and now, electronic elections.  Put differently, your community now has the option to vote entirely by secret ballot using the traditional paper double envelope method or utilize new procedures outlined in California Civil Code §§ 5105, 5110, 5115, 5125, 5200 and 5260 to allow elections[4] by “Electronic” secret ballot. The transition to electronic, however economical, is not automatic and we are advising clients to wait one year for software to mature.  

1. The first requirement is notice in the Annual Policy Statement (distributed annually 30-60 days prior to the new fiscal year) akin to: “If the association elects to utilize electronic voting you may “opt-out” and vote by secret paper ballot simply by contacting the inspector of election in writing upon receipt of the notice of the election.”  If that notice is not provided in the Annual Policy Statement, we suspect an association, upon determining its desire to hold an electronic election, could send out a written “Amended Annual Policy Statement” containing such language concurrently with its first election notice. Even if an association wishes to observe how electronic voting plays out the next year or two, amending Election Rules and publishing the opt-in/opt-out statement in the Annual Policy Statement now will ensure your association is ready to move forward when the time is right.

• The next requirement is for the association to amend their election rules. Keep in mind that the statutory rule adoption procedures outlined in Civil Code §§ 4340 – 4370 require at least 120 days in order to provide the 28-day member review period before adoption of the amended rules at an open Board meeting at least 90 days prior to the election. The following elements must be met (and incorporated into the Election Rules):

• owners must be permitted to change their preferred method of voting (electronic to written) no later than 90 days before an election;
• electronic and written secret ballots must contain the same items to be voted on;
• written ballots are to be mailed only to members who have opted out of electronic voting or for whom the association does not have an email address;
• electronic ballots are to be sent only to members who have opted-in by providing a valid e-mail addresses.
• maintain a voting list identifying members voting by electronic secret ballot and those voting by written ballot.
• prohibit nomination of candidates from the floor.

3)  At least 120 days before the election, provide individual notice to the members with opportunity to change their preferred method of voting (opt-in/opt-out of electronic secret ballot).  Members must be given 30 days to submit preference to association (deadline to submit at least 90 days before election).  The notice must provide:

•     Member’s current voting method

•     What (member’s) email address will be used

•     Explanation that member is required to opt out of voting by electronic secret ballot if member elects to vote by written secret ballot.

•     Explanation of how a member may opt out of voting by electronic secret ballot.

•     A 30-day deadline by which the member is required to opt out of voting by electronic secret ballot if member so elects. 

Remember – Electronic voting is optional.  While tempting, we’re recommending our clients sit out this initial year and let the industry move from the bleeding-edge of this technology to the cutting-edge. We also recommend against associations attempting to set up the electronic voting system in-house.[5] Community associations should request a demonstration of an electronic voting system from their qualified inspector of election company and possible testing of the system in advance of an election.  In the interim, consider taking the following steps: 

• Include notice and opt in/opt out instructions in Annual Policy Statement
• Consult with legal counsel to amend election rules now to incorporate required language
• Create/maintain voting list with member preferences (written or electronic ballot)

Please contact our office to ensure your association is complying with these new laws should you have any questions or would like to revise your election rules and Annual Policy Statement to take advantage of electronic voting.

AB 2460 – Reduced (20%) Quorum Requires Two (2) Notices:  Civil Code § 5115 and Corporations Code § 7512 were amended in the 2023 legislative session to reduce the quorum necessary to 20% in reconvened membership meetings (i.e. second attempts) to elect directors when the bylaws require quorum for director elections and quorum was not reached. 

If the community has provided the proper notice in its pre-ballot package, then after failing to reach quorum at the initial meeting, an association may reconvene the meeting to a date at least 20 days after the original meeting, at which time the quorum reduces to 20%. This is that language: “The board of directors may call a subsequent meeting at least 20 days after a scheduled election if the required quorum is not reached, at which time the quorum of the membership to elect directors will be 20 percent of the association’s members voting in person, by proxy, or by secret ballot.” Get this language into your pre-ballot forms right now!

Then, if there is not quorum at the election, AB 2460 clarifies that “No less than 15 days prior to” the date of the reconvened meeting, “the association shall provide general notice of the membership meeting,” including (a) date, time and place of the reconvened meeting, list of candidates and something akin to the following disclosure:  “Twenty percent (20%) of the association present or voting by proxy or secret ballot will satisfy the quorum requirements for the election of directors and ballots will be counted if a quorum is reached.”

Our Thoughts: Everyone forgets to give the initial notice, then seeks to reconvene per the statute! Also, and obviously, if your bylaws require quorum less than 20%, go with your bylaws and not the statute. Our office can update your Election Rules and answer any questions you may have with implementing the reduced quorum.

SB 428 – Workplace Restraining Orders.  SB 428 amends, repeals and adds §527.8 of the Code of Civil Procedure.  Currently, associations can seek a temporary restraining order (TRO) to protect directors, volunteers, managers, vendors, employees, etc., from an individual for unlawful or credible threats of violence connected to the workplace.  Starting January 1, 2025, harassment will be a new basis for seeking a TRO.  “Harassment” is defined under the law as “a knowing and willful course of conduct directed at a specific person that seriously alarms, annoys, or harasses the person, and that serves no legitimate purpose.”  SB 428 specifically limits courts from issuing TROs for actions that are protected by the Constitution.  So, application of the new law will require briefing the First Amendment/protected speech and conduct issues and thoroughly differentiating the harassment. 

Our Thoughts: This will be a wonderful tool for protection of volunteer directors, vendors and employees (in an earlier timeframe), without having to wait for the misconduct to escalate to violence or threats of violence. 

SB 900 – Association Maintenance and Repairs to Utilities:  SB 900 amends Civil Code §§ 4775, 5550 and 5610 relating to association maintenance of utilities, reserving for utilities and expanding the definition of an “emergency” for purposes of imposing emergency assessments.

Initially, SB 900 was broader in scope to address an unfortunate situation where an association experienced long-term interruption of utility services because of finger-pointing between the association and the utility service provider.  That legislation would have required an association to actually restore utility service within 30 days, or be subject to consequences.  Through industry efforts and pushback, thankfully SB 900 was amended to take into account the limited control an association has over utility services that come into the community. 

Commencing January 1, 2025, if there is interruption in utility services AND service interruption starts in the common area AND a third-party utility is not responsible AND the declaration does not state otherwise, the association must commence restoration efforts within 14 days. 

Generally, under §4775 community associations repair, replace and maintain their common area unless the declaration specifies otherwise.  SB 900 broadens §4775 to make a community association responsible for the repairs and replacements necessary to restore interrupted utilities (gas, heat, water or electrical services) that begin in the common area even if the utilities extend into an owner’s separate interest or exclusive use common area, unless the utility line in question is maintained by a utility company.  Such utilities now also need to be included in the reserve study as a “major component.” 

What about financing the repairs?  SB 900 also provides authority to community associations to obtain a loan from a financial institution to cover the costs of repairs should there be insufficient funds in reserves, without a vote of the owners, even if the declaration requires a member vote.  Associations can also levy an emergency assessment to repay/collateralize the loan. Existing Civ. 5605(b) requires the association to demonstrate specific facts to support the imposition of an emergency assessment without membership approval.  Now, the definition of what constitutes an “emergency” under §5610 is expanded to include threats to “personal health or safety or another hazardous condition or circumstance” on association property. This gives a board more authority to expeditiously keep the association safe and healthy and perform its statutory required duty to restore interrupted utility services. 

What if there’s no quorum for the emergency board meeting?  If the board attempts to hold a meeting during this 14-day window and a majority of the board is not available, SB 900 allows the remaining directors to meet and decide.  SB 900 also allows the board to conduct the meeting via electronic means, including email, to authorize the utility restoration work.   

What about reserve funding?  Reserve studies require visual inspections of major components, as defined.  Historically, underground and other utility lines were not inspected nor included in the reserve study.  Utilities now need to be included in the reserve study inspections and reserve analysts must expand their review of utilities as to remaining useful life as a major component and include in their reserve calculations. 

Our office can assist your association with reviewing your governing documents as to utilities located in the common areas.  Associations also need to ensure that utility repairs and replacements are anticipated in their reserve study.

Accessory Dwelling Units (ADUs):  In recent years, the California legislature has enacted a slew of bills narrowing the control exercised over construction of accessory dwelling units (“ADU”) and junior accessory dwelling units by local agencies, including limitations on community associations. SB 477 reorganizes and renumbers the State’s ADU laws to Government Code §§ 66310, et seq. and makes other non-substantive changes.  Several new ADU bills (AB 2533, SB 1077 and SB 1211) will become operative January 1, 2025. 

AB 2533 adds protections for pre-existing ADU’s by prohibiting a local agency from denying a permit for an unpermitted ADU constructed before January 1, 2020, unless the local agency makes a finding that correcting the violation is necessary to comply with conditions that would otherwise deem a building substandard.  The local agency will be required to publish information of conditions that deem a building substandard, among other things. SB 1077 addresses planning and regulation of development in the coastal zone overseen by the California Coastal Commission to require the commission to develop and provide guidance for local governments to facilitate the simplification of the permitting process for ADUs within the coastal zone.  SB 1211 extends the prohibition of a local agency requiring replacement of offstreet parking spaces if a garage, carport or covered parking structure is demolished in conjunction with construction of an ADU to also include where uncovered parking spaces are demolished.  SB 1211 also prohibits local agencies from imposing any objective development or design standards for ADUs that are not authorized by the state ADU laws.  SB 1211 continues the legislative trend of limiting local agencies from imposing building standards for ADUs different from those established by state law. 

Our Thoughts:  Associations generally have authority to control the appearance of an ADU. Conversion of garages into ADU’s are allowed in PUD (lot) associations, but not condominiums.  If your architectural committee is approached with a request for an ADU, involve our office. If your governing documents reference specific and outdated ADU laws, you’ll want to update to these new code sections.

AB 2622 Handyman // Contractors Exemptions: Work and Advertisements.

The Contractors State License Law makes it a misdemeanor for a person to act as a contractor without a license for jobs over $500.00.  This creates a universe for use of an unlicensed “handyman,” where the maximum contract price for labor, material, and all other items must fall below that number.  AB 2622 increases the maximum aggregate contract price for unlicensed contractors to $1,000 in 2025.  

NEW CASES

MORRIS V. WEST HAYDEN ESTATES, (2024) 104 F. 4th 1128.

RE: Letters discriminating on a basis of race, creed or color can violate Fair Housing law. 

Factual Background: How much is too much Christmas spirit?  Prior to moving into West Hayden Estates, Plaintiff Morris had used their home for a multi-day Christmas event to raise money for charities and desired to do the same at their West Hayden home.  The program included free hot chocolate, candy canes, Christmas carols, costumed Christmas characters, massive light displays with over 200,000 lights, a live nativity with a real camel, and was so successful that visitors arrived by the busload.

 In 2014, Morris made an offer on a home in West Hayden Estates and immediately got pushback from the Association after requesting the association’s position on their annual Christmas extravaganza.  In January 2015, Morris received a letter from the Board.  A first draft of that letter (produced in discovery but not sent to Morris) was written by a former Board member and identified a number of CC&R provisions that he believed the Christmas program would violate, and concluded with a statement “… some of our residents are avowed atheists …” and “… we do not wish to … fill our neighborhood with the riff-raff … We don’t allow “those kind” in our neighborhood.” 

The Board revised the first draft and the version that was sent to Morris toned down the reference to “avowed atheists” to residents that are “non-Christians or of another faith.”  The letter also expressed that it was not the intention of the Board to discourage Morris from becoming a part of the neighborhood but the Board does not wish to “fill the neighborhood with hundreds of people and possible undesirables.”  In February of 2015, the Board scheduled a meeting of the members at which Morris’s home purchase and Christmas program were discussed and the membership voted to not approve the program. 

Undeterred, Morris moved forward with their home purchase and put on even more extravagant Christmas programs in 2015 and again in 2016.  The association did threaten to seek an injunction in 2015, but took no legal action.  After allegedly receiving threats from a West Hayden resident, Morris filed suit in federal court in January 2017 alleging that the Association’s conduct violated the Fair Housing Act and various forms of religion-based discrimination in access to housing.  The Association counter-claimed to enjoin Morris from holding their Christmas program again.  Following jury trial, the jury found for Morris on their FHA claims and specifically finding that the January 2015 letter expressed a preference that a non-religious individual purchase Morris’s home.  Morris was awarded $75,000.

After trial, the federal district court rejected the jury verdict against the association and granted its motion for judgment as a matter of law, holding that Morris’s claims rested primarily on the January 2015 letter and that an ordinary reader would not view the letter as showing that the Board intended to discriminate on the basis of religion.  The district court concluded the Christmas program violated the association’s CC&Rs and granted an injunction barring Morris from hosting the program in West Hayden Estates.  Morris appealed. 

Holding: The Ninth Circuit Court of Appeals partially affirmed the district court’s rejection of the jury verdict, holding that Morris did not establish intentional discrimination by the Association because they did not show that they were adversely affected by the association’s actions.  The Court also reversed in part holding that a reasonable jury could find that the association interfered with Morris’s right to purchase and enjoy their home free from discrimination, affirming a grant of a new trial as to that claim. 

Our Thoughts: (1) Do you see the admission and use of a director’s (not the Board’s) draft letter? Every e-mail you send can be discovered and used against you and your community!  (2) Competent counsel would have revised this correspondence to discuss only impacts like noise, traffic and emergency access.

COLYEAR V. ROLLING HILLS COMMUNITY ASSN., (2024) 100 Cal. App. 5th 110.

RE: CC&Rs must be recorded to be enforceable. 

Factual Background: Palos Verdes Corporation acquired a large portion of the Palos Verdes Peninsula and began subdividing Rolling Hills in the mid-1930s.  The first set of CC&Rs for the first phase established a general plan for the Rolling Hills development; however, the CC&Rs were recorded with a legal description that only covered a portion of Rolling Hills.  Over time, additional tracts were annexed in.  The original CC&Rs and many subsequent CC&Rs contained provisions permitting the Association to trim trees on properties to preserve views.  Some CC&Rs did not contain this provision.  Colyear owned two parcels that contained many mature trees.  The CC&Rs covering his property did not contain a tree-trimming provision.  Colyear preemptively initiated legal action seeking a declaration that the original CC&Rs were not binding on Colyear’s property and an injunction against trimming the trees on his property.  The trial court granted Colyear’s request for declaratory relief and an injunction, awarding Colyear attorneys’ fees. 

Decision: The Court of Appeal upheld the trial court, finding that the original CC&Rs containing the tree-trimming covenant was not enforceable against Colyear’s lots because the original CC&Rs were not recorded against Colyear’s property when he purchased it and he could not impliedly agree to the terms of the original CC&Rs terms.

Our Thoughts: A very good decision which cleared up previous conflicting cases about applicability of non-recorded instruments. A servitude is either recorded, or its unenforceable.

DOSKOCZ V. ALS LIEN SERVICES, (2024) 102 Cal. App. 5th 107.

RE: Contract between owner and association superseding statute violates public policy.

Factual Background: Teresa Doskocz owns a townhouse in Danville Green Homeowners Association.  The association hired ALS Lien Services (ALS) to collect unpaid assessments from Doskocz.  In November 2013, ALS sent Doskocz a pre-lien letter for delinquent assessments in the sum of $1,239.08 threatening possible foreclosure. ALS recorded a delinquent assessment lien the following month and thereafter, Doskocz entered into a payment plan.  The plan included a waiver of Civil Code § 5655(a) which requires payments to first be applied to the outstanding assessments, and that only after the assessments are paid in full are the payments to be applied to collection costs and fees, attorney’s fees, late charges or interest.  Instead, ALS was paid its fees and costs first, followed the client’s receipt of interest and principle.  Doskocz filed a class action lawsuit against ALS in federal court alleging violations of the Fair Debt Collection Practices Act (FDCPA) and California’s unfair competition law (UCL). 

Holding: The Court of Appeals upheld the finding that ALS’s waiver of Civil Code § 5655(a) was void as against public policy and that ALS’s pre-lien and pre-NOD letters improperly threatened foreclosure when the claim was less than the threshold of $1,800/12 months. 

Our Thoughts: ALS mis-stepped here by contractually agreeing to circumvent the law. Review your collection policy and remove language suggesting foreclosure prior to the $1800.00 mark.

DUBAC V. ITKOFF, (2024) 101 Cal. App. 5th 540.  

Re: Some statements by owners are defamatory.

Background: Director Robert Dubac and homeowner Sandra Itkoff owned units in the same six-unit condominium building. These neighbors did not get along.  Several emailed statements from Itkoff alleged Dubac as racist and acting with racial animus, acting in bad faith as a director of the association, accosting women, stealing mail, filing false police reports, mistreating their daughter, among others.  Dubac filed suit against Itkoff for defamation and other claims.  Itkoff filed an anti-SLAPP motion contending that their statements concerned a matter of public interest (because Dubac was a director) and thus were protected. 

The trial court ruled that several of the statements did not meet the first prong of anti-SLAPP analysis – requiring that the statements were speech in connection with a public issue or an issue of public interest.  The trial court also found that Dubac demonstrated a likelihood of prevailing on his claims for most of the statements.  Itkoff appealed.  At issue on appeal was whether the statements made by Itkoff furthered public discussion of the implicated public issues. 

Holding: The Court determined that the content and context of the emails from Itkoff showed a personal feud with Dubac, with a dominating theme of mistreatment of their daughter.  Contextual factors taken into account included the identity and number of speakers, the audience, the location of the communication and the purpose and timing of the communication.  Applying these factors, the Court rejected Itkoff’s argument as an attempt to elevate her “personal squabble” and “name-calling” into a public issue.  Itkoff’s statements were primarily focused on the personal dispute, made by a limited identity and number of speakers, confined to the small association membership and not disseminated to the general public.  The Court also reiterated that homeowners associations are private organizations with the fundamental purpose of controlling private property to which the public has no inherent right of access.  The Court of Appeal affirmed.

Our Thoughts: This is a very good case, which changes the landscape of libel/slander actions by directors. Not every issue within a homeowners association is a public issue. However, plaintiff Itkoff hurt themselves substantially by stating in their letter that this was: “… not HOA business…This has nothing to do with the HOA at this point, this is between you and me.” Without that statement, the court could quickly have gone the other way. 

WOOLARD v. REGENT REAL ESTATE SERVICES, INC., certified for publication

Re: When an association has no duty to intervene in resident disputes

Background: The Fourth District Court of Appeal addressed an ongoing and ultimately physical series of conflicts between tenants which took place on and across the association’s common areas.  Amongst others, the tenants sued their landlords, the association and the management company. Dismissing the case against the association and the management company, the Court stated as follows:

Holding: “In sum, there is simply no law to support Woolard and Hall’s contentions that (property management company) Regent and (association) Greenhouse had some unspecified duty to do something to prevent what turned into an allegedly violent dispute. Imposing a duty on homeowners associations or their managing agents to intervene and attempt to resolve disputes between homeowners (or their tenants) would place an untenable burden on these entities. Run by volunteers, they already have enough (and some would argue too much) authority and responsibility. Associations do not have police powers or subpoena power. They cannot compel owners, much less tenants of owners, to sit down and work out their differences, and they cannot adjudicate differences except in the limited context of violations of the association’s governing documents.”

Our Thoughts: Obviously, this is a phenomenal ruling for the association and those who manage them. However, this area of law (an association’s duty to its owners) is littered with conflicting holdings depending on the background circumstances. For example, Board’s must balance this case with Federal Code Section 24 CFR 100.7 holding associations liable for failing to intervene when made aware of conflicts between residents arising from race, color, creed and the full panoply of protected classes. In that situation, contact our offices immediately.

NEW LAWS WRAP UP/TO DOs:

• Consider submitting the BOIR for association and beneficial owners now, or discuss a plan to do so if the courts rule in favor of the Federal government.  
• Condominium Projects – Complete Balcony Bill inspection and submit the report to the reserve analyst.
• Prepare for electronic voting by (a) amending Election Rules and (b) updating the Annual Policy Statement report with opt in/opt-out instructions.
• Amend Election Rules and Call for Candidates nomination form to reference CTA reporting requirements and compliance.
• Amend Election Rules and Bylaws to reference 20% reconvened quorum or to remove quorum for director elections
• Review governing documents for common area utilities and update reserve study for SB 900 compliance.
• Planned Developments – Adopt ADU policy or amend existing policy to update code section references.

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[1] Some 23 exceptions to the registration requirement apply, including unincorporated associations, charitable corporations (like a 501C(3)) and large operating companies (which separately report).  However, a nonprofit mutual benefit corporation is not exempted. If you think your association falls within an exemption, consult with us. 

[2] On 12/03/24, a federal court in Texas stopped all enforcement of CTA’s reporting requirements nationwide.  On 12/10/24, FinCEN stated companies were not subject to liability for failure to report by 01/01/25.  On 12/23/24, the Fifth Circuit Court of Appeals Motions Panel granted an emergency motion to stay the nationwide preliminary injunction – which reinstated CTA’s reporting requirement.  FinCEN then extended the deadline to report to January 13, 2025.  On 12/26/24, the Fifth Circuit Court of Appeals full panel of judges vacated the Motion Panel’s stay, thus, reinstating the nationwide injunction.

[3] The physical address of the association can be a bit tricky to determine, as the actual business of the association occurs at board meeting, which may be held virtually, at a manager’s office, at an on-site office, or in a member’s home. If professionally managed, use that address. If not, use the address of the president or other officer who handles the mail for the corporation.   

[4] Elections for directors, the transfer of common area and amendments to the governing documents.  For reasons which are unclear, electronic voting is not available for special assessments.

[5] Inspector of election companies are already setting up their systems to implement the technological and security requirements of the new laws to, amongst other things: authenticate member identities; securely transmit the secret ballot to prevent alteration; separate member identification from actual ballot to preserve anonymity; receive receipt of vote; preserve secret ballot and tally sheet; and provide receipts of voting.