California Special Assessments

Greetings,

The wording of the CA law regarding special assessments is somewhat confusing.

CA CC 1366 states:

“…the board of directors may not … impose special assessments which in the aggregate exceed 5 percent of the budgeted gross expenses of the association for that fiscal year without the approval of owners,…”

It is not clear whether a special assessment of 5% means each unit is charged 5% or that the 5% is divided by the number of units.

Say your annual budget is 200,000 and there are 75 units. 5% of $200,000 = $10,000. $10,000 / 75 = $133.33. $133.33 would be the maximum amount the board can impose with out a vote. I believe the law means EACH UNIT can be assessed $10,000 without a vote of members and that in any one year the total amount of special assessments PER UNIT cannot exceed $10,000.

Can anyone clarify this?
Thanks
Jane

I suspect what Roger says is true of the vast majority of associations, but please read your documents carefully. We are required, by our Delcaration of Condominium Ownership, to apply special assessments on a percentage of ownership basis determined by square footage of the units. There may also be certain exceptions for "emergency repairs" and perhaps other reasons where you don't have to go to the community for a vote, but most special assessments will require a vote. The law established the cap on the total, but not necessarily the individual amounts. Good luck.

How are your dues set now (uniform or by the size of the unit)?

Any raise would follow that same formula.

It is 5% of the annual budget and then divided by the number of homeowners - so this is usually a very modest amount.

Understand. Thanks for the clarification.
Can this be done more than once a year?
Jane

Well, how often is he determining "budgeted gross expenses" ?

I'd say once that budget amount is set (by the approved budget vote,) then that's it for the year UNLESS the budget can be amended.