Reminder: July 1, 2022 Deadline to Have Completed Amendment to Rental Restrictions Which Conflict with LawDrew Hendricks
Bad News: If your association’s documents currently contain a minimum rental term of greater than 30 days or a rental cap of less than 25%, they now violate California law. Good news: The Legislature extended the time for unilateral Board amendment to remedy non-compliant rental restrictions until July 1, 2022. However, since it takes some time to review your existing documents and — if amendment is necessary — give your homeowners a 28-day period to review and comment on the proposed amendment, it is imperative that you take immediate action to ensure legal compliance by July 1st.
For example, if your CC&Rs impose a minimum lease term of 6 months, you must amend that provision to reduce it to a 30-day minimum lease term. If you don’t, and a future Board attempts to enforce the provision, the Board faces a penalty of up to $1,000 in addition to damages and paying prevailing legal fees to the owner. Our previous, more detailed, article about the new laws, discussing both AB 3182 and AB 1584, is available here.
More important, if you have a non-compliant provision in your CC&Rs and choose NOT to amend it, this will result in your association effectively having NO restriction on rentals. Since the provision conflicts with the law, it would be totally unenforceable.
We recommend you work with your Board(s) NOW to review your governing documents as to any non-compliant rental provisions and, if necessary, to draft an appropriate amendment in the next month to be then approved by the Board.
To our clients on retainer: we can perform a quick evaluation of your governing documents and let you know with a short email if they need to be amended, for a flat fee of $150 (higher rates apply for associations which have several CC&R amendments and rules we need to look at). If an amendment is needed, the cost of preparing the amendment package will depend on the outcome of the evaluation and how many provisions need to be changed.
We look forward to assisting you!
Community Legal Advisors Inc.
Michael J. Alti, Esq.