Echo Journal May/June 2020

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PEER PERSPECTIVE

A NEW NORMAL

East Bay Educational Seminar

HOA Amenities & COVID Precautions

An HOA Board Deals with a Homeless Encampment

HOA Business After Coronavirus

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SERVING HOA BOARD MEMBERS & HOMEOWNERS

MAY/JUNE 2020

THE IMPACT OF COVID-19 ON COMMUNITY ASSOCIATIONS

Navigating Uncharted Waters PAGE 8

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BOARD OF DIRECTORS & OFFICERS PRESIDENT

DIRECTORS

David Hughes

Jerry L. Bowles

VICE PRESIDENT Adam Haney

Sarah Dunia

TREASURER

Mark Guithues, Esq.

Karl Lofthouse

David Levy, CPA

Sandra Long

EDUCATIONAL SEMINAR

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• Ask your questions of on-site attorneys • Visit with industry experts at exhibit tables

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• Meet and connect with board members from neighboring communities As an Echo member, you can register AND invite individual homeowners and clients FOR FREE when you apply the promo code!

Rolf Crocker John Gill, Esq.

SECRETARY

7:30 am Check-in, Networking and Continental Breakfast

Diane Rossi Katrina Solomatina, Esq. Wanden Treanor, Esq.

EXECUTIVE DIRECTOR

David Zepponi MEMBER ENGAGEMENT MANAGER

Hannah McAuley hmcauley@echo-ca.org MEMBERSHIP & SALES ADMINISTRATOR

Jacqueline Price jprice@echo-ca.org

Echo is the only statewide organization created solely for HOA board member and homeowner education in California.

For more than 47 years, Echo has continued to be a leader in quality educational programs that build stronger communities.

Echo and the Marriott are taking extraordinary precautions to protect against the transmission of COVID-19 during this event, including limiting attendance, social distancing and increased sanitation of the facilities. The event will also be available via a live stream online.

The ECHO Journal is published bi-monthly by the Executive Council of Homeowners (ECHO). 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.

www.echo-ca.org

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. © 2020 Executive Council of Homeowners (ECHO) All rights reserved. Reproduction except by written permission of ECHO is prohibited.

events@echo-ca.org THANK YOU TO OUR SPONSORS

ECHO member information is never released to any outside individual or organization.

ECHO journal | May/June 2020

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LIVE STREAM ZOOM EVENT

June 2, 2020 | 1:00 - 2:00 pm

Technology That Benefits HOA Board Members

2020 will be remembered as a once-in-a-lifetime moment in time by the entire world.

A board’s duties have become more challenging with the mandated stay-at-home order and continue to be effected by the gradual re-openings of California counties.

The impact of COVID-19 will be felt for a very long time in every industry, in all organizations, in each job, as well as our personal lives.

REGISTER HERE PRESENTED BY

Barry Ross Ross & Ross International

During this live webinar learn about:

• Trends and impact of the coronavirus on HOA boards

• New technologies that can help board members save time, reduce stress and do a better job for their HOA

• Hot technology tips for working from home

HOA Board Member or Homeowner: FREE Professional Service Provider Member: $15 | Non-Member Professional Service Provider: $25 4

May/June 2020 | ECHO journal

Click a title to jump directly to the page!

Features 4

Webinar Registration: Technology That Benefits HOA Board Members

8

Navigating Uncharted Waters

BY J. SPENCER EDGETT, ESQ.

15

Webinar Registration: Opening HOA Communities After COVID

25

What to Do When Your HOA Has No Functioning Board of Directors

BY KARA L. WILD, ESQ.

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The New Normal in Community Associations

BY DEREK MOBRAATEN, CCAM-PM

Happenings

3

15

East Bay September Educational Seminar

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Executive Director’s Message: Reasonableness for HOA Boards & Homeowners – Coronoavirus

BY DAVID ZEPPONI

Electronic Version of Echo Journal

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8

17

At Echo We Care!

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Peer Perspective: Up Close & Personal: How a Proactive HOA Board Dealt with a Homeless Encampment

BY PAM MARSH

22

Hiring for Success: Finding the Right Management Fit

BY JOHN CLIGNY, CAMEX, CCAM-HR, AMS

21

Legislative Review

28

33

Welcome to Our New Professional Members

34

Echo Bookstore Offerings

ECHO WEBINAR

25

Index of Advertisers

ECHO journal | May/June 2020

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EXECUTIVE DIRECTOR’S MESSAGE

Raison d’Etre – The Reason for

What a beautiful phrase, raison d’etre (reason for being). I every board member should consider and collectively agree REASONABLENESS FOR HOA BOARDS AND HOMEOWNERS – CORONAVIRUS The phrase engenders humanity. The words roll from one’s Getting Back to a “New Normal”

stark business senses and adds the element of humanity t

Governor Newsom relaxed the requirements difference isplanning, that the board decisions and are much a board: Strategic execution evaluation; mi of the “Stay in Place” order outlining a fourmore personal because they directly impact the management. The business realities should be reflective of phase plan to restart the economy and a more quality of life of the people they know and see common values of individuals in the community. normal lifestyle safely. President Trump also has regularly from the community. suggested that America needs to get back to Communities are imperfect – because they are made of huma work. Mass demonstrations and civil disobedience Making decisions in a period when uncertainty relating.

Human living. has become commonplace and likely stimulated a Humans rules is notusing. for the faint of heart but it Basically, is a place humans b being human, communities sometimes forget political answer to the handling of the coronavirus to forge courageous leadership.

It is at this very that manag pandemic. Local police jurisdictions are struggling local level that American society will test its establish norms for a successful community. In a sense, t to enforce unclear guidance in regulations, mettle and resilience. the community.

Its purpose is to establish order and elev while local officials try to implement executive progress and pace by establishing norms and constraints directives in workable ways at local levels.

Should HOA boards allow use of amenities and to benefitcertain all. activities again or is it just too risky?

For HOA boards and homeowners, management Management should take several things into It seems apparent that board leadership must understand of the pandemic in communities becomes much consideration including compliance of the inmost order to orchestrate a sense of community and g more elementary: What is reasonable andowners what recent health orders and the community’s is not reasonable? Then decide. HOA boards tolerance for health, safety,The financial and legal and protect community values. purpose of arisk. board, ther simply must do what is best for the community After input from member attorneys, the following build community based on common values for the good of as a whole and in consideration collectively of guidance has been provided. In the end, it really individual needs and concerns. Like the President, boilsto down to risk tolerance, reasonableness and time to kno It takes time orchestrate a community.

It takes the Governors and the Speaker of the House, individual liberty versus that of the whole. time to listen to the voices and build a vision reflective of c HOA boards are learning as they go too. The

Continuedmember on page 33 and sati and you will be more effective as a board your reason for being on the board.

ECHO is committed to helping homeowner boards and resid ing and advocacy – this is our “raison d’etre”.

Good luck and stay safe,

Sincerely,

David Zepponi Executive Director

ECHO EXECUTIVE DIRECTOR

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May/June 2020 | ECHO journal

ed rnal Releas u o J o h c E f ersion o oronavirus C h it Electronic V w ls a d just a ion De contemplate t o n s ay as Associat w s; to lives in

wner s and gaged homeo ng businesse en ti d ac p an s im d is ar ic and in the A bo irus pandem government connect HO in to s ed st re sh li te The coronav b ship of esta ers’ in our member o. Echo was te for memb ag rm ca s o fo v th in n ad o to m to l o few unsel; and community a primary to cation and co t of the HOA o Journal is en ch E rm e te h T et . provide edu b the erience dustry arn and exp with them to sociation in le l as ea to y d it ce n to la u p w m o n o com ustry and h uild a comm es to the ind vehicle to b a is It . ts ct the challeng h ra g d p ice. ual ri A thought an O ul of individ tf H f ec o sp m re iu d an t compend had to an importan ses, Echo has es n si u b while being er ased that y oth are very ple and like man e ic W . em es d ic an rv p se ronavirus any of our erations and set of the co owever, as m H ect to its op . sp es re v li h r it With the on ei w s events to th ision ur in-person le disruption o difficult dec tt e li m o h m it fr so w e ed d ak iv m der ployees an t companies, r income is tained its em managemen ortion of ou – p s e er rg id Echo has re la v a ro , p attest posed due to nal service embers can limitations im our professio e m longtime m th y. o fr m o ip fr h g rs elin the econom oing sponso s are also re ur lives and o se es th n o si b and the ong u n b o e t Thes tating impac d vendors. aving a devas h law firms an is h ic h w direct and It is a virus es. The most g an ch COVID-19. w fe azine to an to make a a printed mag o has decided m ch o E fr , l d will a es rn m u ti ng costs an Echo Jo lenging li e al ai th ch m f e o d n es an o th si g n Given is the conver If not, you Echo’s printi ost obvious ail address). ill eliminate w em e g an an e ch av maybe the m h e ine. This boards (if w onic magaz ine to HOA az ag online electr m e th ase ur website. directly rele azine from o allow us to ag m e th t n ay/June and ad and pri ibute the M tr is d may downlo to n la ersion we p e a printed v . Currently, m re su su re ea to m e ry p pora ally. We ho be able to will be a tem al electronic society will rn u er h Jo et We hope this o h w ch E d e s an cho Journal editions of th policymaker sion of the E n er o v p d u le g ai in d m July/August d ile we r depen the printed an standing wh er in d of the yea d n n en o u ti e d p th an ru re is ce o n bef y for the d r your patie avirus. . We are sorr on by coron e also ask fo t W h . g u ty si ro b es resume work es ec ng d the n omic challe u understan me the econ co er and hope yo ov d an new normal adjust to the Sincerely, oni David Zepp irector (Echo) Executive D omeowners H f o l ci n u o Executive C

ECHO journal | May/June 2020

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BY J. SPENCER EDGETT, ESQ.

THE IMPACT OF COVID-19 ON COMMUNITY ASSOCIATIONS

Navigating Uncharted Wat

T

he COVID-19 pandemic and resulting ‘shelter in place’ orders have significantly impacted the operation and management of community associations. We are in uncharted territory and there is much uncertainty with respect to how best to navigate the challenges we are presently facing.

The most important thing for any community is to stay informed and follow the directives of the federal, state and local governments with respect to social distancing and other guidelines to ensure the health and safety of members and guests. Any action taken should be done in consultation with the association’s legal counsel to ensure compliance with the law and best practices at the time of implementation. As the ‘shelter in place’ restrictions are gradually lifted and ultimately come to an end, we will likely be faced with a ‘new normal’ that will require communities to make changes in some aspects of operation and management.

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May/June 2020 | ECHO journal

aters

ECHO journal | May/June 2020

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RS & OFFICERS DIRECTORS

Jerry L. Bowles Rolf Crocker Sarah Dunia John Gill, Esq. ark Guithues, Esq. David Levy Diane Rossi atrina Solomatina Wanden Treanor

Navigating Uncharted Waters

Boards change frequently, so keep your Teleconference and HOA’s informationEducation up to date! that Send builds us:Using Videoconference Technology Many associations are Education that builds stronger communities. grappling with how best 1. Board Names stronger communities. to continue safely holding board meetings and remain in 2. Mailing Addresses compliance with the Davis-Stirling open meeting act. The Davis3. Email Addresses Stirling Act already provides for Continued from page 9

RECTOR

poni

meetings to be held telephonically

rything to account@echo-ca.org or ask your property and manager this is being successfully ENT MANAGER Sign up online for Echo’s applied to new technologies Auleyso on your behalf. Thanks for being an ECHO member! do

Price

Email:

e-newsletter, Echo suchInsight! as videoconferences using It’s free for everyone and theplatforms. internet-based Questions? We can help: content can be repurposed Specifically, Civil for Code § 4090 includes the following in the your community newsletter! account@echo-ca.org. Phone: 408-297-3246

i-monthly by the rs (ECHO). The views es herein do not CHO. We assume no and opinions advanced zine. It is released with sher is not engaged in her professional service. sistance is required, the onal should be sought.

not constitute any n, expressed or implied, services offered. We dvertising copy.

meowners (ECHO) except by written d.

CONTENT © 2019 ECHO

ver released to any n.

10

definition of a board Meeting: (b) A teleconference, where Sign up at www.echo-ca.org at a sufficient number of directors the bottom of the home page. to establish a quorum of the board, in different locations, are connected by electronic means, through audio or video, or both. . . . Except for a meeting that will be held solely in executive session, the notice of the teleconference meeting shall identify at least one physical location so that members of the association may attend, and at least one director or a person designated by the board shall be present at that Sign up online for Echo’s e-newsletter, location. Participation by directors Echo Insight! It’s free for everyone and the in a teleconference meeting content can be repurposed for constitutes presence at that your community newsletter! meeting as long as all directors participating are able to hear one 2019 3 Sign up at www.echo-ca.org ECHO journal | November/December another, as well as members of the at the bottom of the home page. association speaking on matters before the board. [Emphasis added] Civil Code § 4925(a) provides: As specified in subdivision (b) of Section 4090, a member of the Education association shall be entitled to Advocacy attend a teleconference meeting Connection or the portion of a teleconference meeting that is open to members, www.echo-ca.org and that meeting or portion of the CONTENT © 2019 ECHO

STRATOR

May/June 2020 | ECHO journal

Education Advocacy Connection

www.echo-ca.org

Considerations for Videoconference Board Meetings

• The use of passwords to prevent unauthorized participants from entering the meeting;

• Mute all participants on entry but allow for members to speak during the member forum portion of the meeting;

• Advise members that they are not authorized to record either the video or audio of the meeting and these functions should be disabled from the videoconference platform used.

meeting shall be audible to the members in a location specified in the notice of the meeting.

Associations holding videoconference meetings should also provide members the ability to dial in on a teleconference line as the computer audio can be less reliable. Further, due to the current physical distancing guidelines, associations likely can and should (at least for the time being) forego the requirement to have at least one physical location for members to attend in person. The use of videoconference technology can also be used to broadcast the opening and tabulation of ballots by an inspector of elections and thus associations do not need to indefinitely postpone upcoming elections (which will need to be conducted entirely by mail-in ballot only for the time being).

Association’s should discuss this with their own legal counsel as opinions may differ and the recommendations change as the health situation evolves.

The good news is that many associations are quickly adapting to these technologies and are often reporting increased

attendance at meetings! Due to the popularity of these platforms resulting from the convenience and ease of use, video conference meetings are likely here to stay.

Continue to Collect Assessments but Possibly Change Procedures for Delinquent Accounts The current economic situation will certainly result in additional hardships including the inability of some owners to keep up with the payment of assessments.

Although there is a strong desire to be compassionate towards members experiencing hardship, the board has a fiduciary and statutory duty to levy and collect assessments. Specifically, Civil Code § 5600(a) provides that “the association shall levy regular

and special assessments sufficient to perform its obligations under the governing documents and this act.” [Emphasis added] As such, waiving assessments is probably not advisable for any community.

Rather, the better approach for most associations is to continue to collect assessments as they normally would including the imposition of fines or penalties to incentivize all owners to timely meet their financial obligations.

As with any delinquent account, associations should handle them on a case by case basis and consider offering payment plans for those experiencing financial hardship.

Members may request a meeting with the board in executive session to discuss Continued on page 12

Echo Members Can Sign up for FREE online board meetings!

Click Here to Register ECHO journal | May/June 2020

11

Navigating Uncharted Waters Continued from page 11

a payment plan. (Civil Code § 5665). The board can meet with a member in executive session using videoconference technology as discussed above. Similarly, dispute resolution pursuant to the association’s Internal Dispute Resolution “IDR” ‘meet and confer’ process or Alternative Dispute Resolution “ADR” i.e., mediation can be completed using videoconference technology.

Therefore, associations should review their IDR/ADR policies and procedures and consider implementing emergency rules, if necessary, allowing for use of videoconference technologies for dispute resolution.

Use of Common Areas and Facilities Due to the ‘shelter in place’

orders and health directives, many common area facilities were required to be closed, including clubhouse restaurants, gyms, pools, golf courses, etc. The board does not have any discretion with respect to government mandated closures. When the restrictions begin to loosen and/ or if certain common facilities are not required to be closed by the state or local governments, associations may nevertheless want to consider implementing physical distancing rules and other procedures to protect the health and safety of residents and guests. In this regard, the board may adopt emergency operating rules (discussed further below).

Such rules could include requiring all users to wear face masks, maintain physical distances, reduce the number of people that can use a particular amenity

(i.e, no gatherings of more than 20 people in the clubhouse at any one time,) wiping down gym equipment with disinfectant wipes after each use, etc. Further, some communities, particularly those with higher risk members (55+ communities) may want to maintain closures of certain facilities longer than required by the state and local government.

Associations should also consider additional measures such as the installation of hand sanitizer dispensers, disinfectant wipe dispensers in gyms, more frequent cleanings of common areas and use of higher-grade disinfectant cleaning products.

These modifications will of course impact the budget which may need to be modified to account for the added sanitary and cleaning expenses. Although these measures are responses to

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May/June 2020 | ECHO journal

the current COVID-19 pandemic, the long-term implementation of enhanced sanitary practices is likely to be the norm for the foreseeable future.

Enact Immediate Emergency Rules Related to COVID-19 The Davis-Stirling Act provides the board of directors the authority to implement emergency rules to address an imminent threat to public health or safety without providing the 28-day comment period required for the implementation of operating rules.

Specifically, Civil Code 4360 provides: (d) If the board determines that an immediate rule change is required to address an imminent threat to public health or safety, or an imminent risk of substantial

“LET'S TALK INSURANCE, I'M JUST

economic loss to the association, it may make an emergency rule change, and no notice is required, as specified in subdivision (a).

An emergency rule change is effective for 120 days, unless the rule change provides for a shorter effective period. A rule change made under this subdivision may not be readopted under this subdivision. [Emphasis added] The current situation certainly qualifies to trigger the emergency rule making exception. The emergency rules are only in effect for a maximum of 120 days and cannot be extended without circulating to the membership for comment. Therefore, once the emergency rules are implemented, the board should consider circulating them for the 28-day comment period in order to either

make them permanent or at least extend them beyond the initial 120-day period.

Always Consult Legal Counsel Before Making Significant Changes to Operations and Procedures Any significant changes to operations and procedures should be reviewed with the association’s legal counsel to ensure the actions are permissible under the law and procedurally and substantively appropriate.

J. Spencer Edgett, Esq. is a partner with Chapman & Intrieri, LLP, and has represented community associations for more than 15 years, both as general counsel and in pursuing claims against developers and contractors for construction defects. Spencer can be reached at spencer@cnilawfirm.com. Visit www.cnilawfirm.com for more information.

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All participants logged on and did not report any issues with joining the call. It worked seamlessly!! Also, Echo joined the call at the beginning to ensure all questions and issues were answered and everyone was comfortable with using the tools.”

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LIVE STREAM ZOOM EVENT

June 4, 2020 | 1:00 - 2:30 pm

Opening HOA Communities After COVID Presented by

In this webinar we will discuss some of the legal and practical challenges faced by homeowners associations in re-opening common areas and amenities and in fair governance as California counties begin to ease the Shelter in Place restrictions.

John P. Gill, Esq. Hughes Gill Cochrane Tinetti, PC

REGISTER HERE Rolf M. Crocker, AMS, CAMEx, CCAM OMNI Community Management, LLC

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May/June 2020 | ECHO journal

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“ZOOM is user friendly and makes it easy to communicate. I am very appreciative of ECHO for offering this service because without it, our monthly HOA meeting would have been cancelled.�

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FREE Access to Online Video Conferencing for HOA Board Meetings During the coronavirus isolation, you are not alone. Echo is working hard to build resources to assist you and your HOA during this difficult time.

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ECHO journal | May/June 2020

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A PEER PERSPECTIVE

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May/June 2020 | ECHO journal

BY PAM MARSH, HOA BOARD MEMBER & ECHO VOLUNTEER

HOW A PROACTIVE HOA BOARD DEALT WITH A HOMELESS ENCAMPMENT

Up Close & Personal A

s many of you know, California has a growing homelessness issue! This issue became front and center for my community in September 2019. I live in a 268-unit, gated townhouse association in Santa Rosa, which borders the Joe Rodota Recreational Trail – which is where a group of homeless people created a small encampment.

The encampments and the local police had already been engaged in a cycle of rousting the homeless from one spot and forcing them to move to another.

This had been going on for years but suddenly that ceased! The camp kept growing and growing with no intervention by the police. As my HOA board’s vice president, the board of directors and I began to see that more and more of our members were being impacted by our unsanctioned neighbors. As a board, we decided to reach out to our community and see what issues they were experiencing and to determine if we needed to mobilize as a group.

We set up meetings with homeless advocates, legal aid representatives and concerned neighbors. This is where my education began.

We discovered that a judicial order – an injunction – had been put in place in August 2019 which prevented the police from moving people from the camps. The injunction stemmed from a lawsuit in Boise, Idaho in which a homeless woman, undergoing treatment for late stage cancer, sued the city of Boise for constantly making her move. Sadly, she passed before learning the judge ruled in her favor. The injunction essentially stated that homeless individuals must first be offered a reasonable place to stay, a host of services – including mental health and substance abuse counseling – as well as storage of their personal items for a specified period of time. The injunction remains in place until June 2020, when it will be revisited.

The trail is under the county’s supervision, yet the camps were in city limits.

What I found was an absolute reluctance by both city and county officials to assist these folks. They each pointed fingers at one another! In October 2019, Continued on page 20

ECHO journal | May/June 2020

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Up Close & Personal Continued from page 19

Sonoma County was engulfed by the massive Kincaid fire, the winds picked up and our fears grew.

The homeless used open flames for cooking, warmth and social gathering. Unfortunately, these fires were under trees which lined the sound wall that separated the encampment from the HOA. When the threat of the Kincaid

fire had passed, we found the camp had grown exponentially, with the largest portion of the camp 40’ from my front door, separated only by a 10’ high, concrete brick sound wall!

For six months our community endured a host of problems from the encampment including: trash, used needles, bottles of human waste, tents, food, various metal parts, an increased rodent

population, noise, fires, fights, etc. What we found was that the majority of these “campers” had been asked to leave other camps for failing to follow rules and had relocated to our neighborhood.

We asked our members to document all incidents in writing so we had a record to share with authorities illustrating the impact this encampment was having on our community. We worked with our business neighbors, homeless advocates and legal aid representatives to try and open lines of communication.

Additionally, we lobbied both the city and county supervisors to get changes made! On January 31, 2020, after a massive effort by county workers and volunteers, the 250+ homeless residents were removed from the trail, with many accepting the offer of shelter.

On a personal note, I was shocked to learn how many of these people were actually born and raised in Sonoma County, who attended school, graduated and still have family and friends here! And finally, a reminder that each individual is somebody’s daughter or son, aunt or uncle, mother or father and to please treat them with the compassion that ANY human deserves, despite their circumstances.

Pam Marsh currently serves as the vice president of the board of directors at Casa Del Sol HOA, and has been a member of ECHO for 25 years. She is co-chair of the Wine Country Resource Panel and is an active member of the North Bay Resource panel. Pam currently works as Benjamin Moore’s HOA and Repaint Specialist. https://www.google.com/amp/s/amp. idahostatesman.com/news/local/ community/boise/article235065002.html https://nlchp.org/supreme-court-martin-vboise/

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May/June 2020 | ECHO journal

The Legislative Session Continues!

For the most up-to-date information, visit the HOA Advocacy section at the ECHO website: www.echo-ca.org/hoa-advocacy

2020 is the second and final year of this legislative session. The list below contains new bills introduced this year. This list, and the impact of each bill, will change as authors amend the language in these bills and others.

Current Legislation AB 2227 AUTHOR: Irwin SUBJECT: FDIC & Fidelity Bond Coverage STATUS: In Assembly Housing POSITION: Watch SUMMARY: Would require that association funds

transfers greater than $10,000 receive prior written approval from the board of directors, that association funds shall be deposited in an institution insured by the FDIC, and that the association maintains certain types and levels of coverage for its directors, officers, and employees.

AB 3182 AUTHOR: Ting SUBJECT: Short Term Rentals STATUS: In Assembly Housing POSITION: Watch SUMMARY: This bill would make void and

unenforceable any governing document that purports to prohibit the rental or leasing of any of the separate interests in a common interest development.

It provides that an owner of a separate interest in a common interest development is not subject to provisions that effectively prohibit or unreasonably restrict the rental or leasing of any of the separate interests. The bill would not apply to a provision in a governing document that prohibits short-term rentals of 30 days or less.

SB 182 AUTHOR: Jackson SUBJECT: Fire Retardant Roofs STATUS: In Senate Housing POSITION: Watch SUMMARY: Within a very high fire severity zone,

requires an association to allow an owner to use at

least one type of fire retardant roof covering material that meets certain requirements as defined in the section and in the International Building Code.

SB 969 AUTHOR: Wieckowski SUBJECT: Association Elections STATUS: In Senate Housing POSITION: Watch SUMMARY: Includes among the permissible reasons

for disqualifying a person from nomination as a member of a Board of Directors of a common interest development, if the person has served the maximum number of terms or sequential terms allowed by the association. Requires additional persons to be appointed and overseen by the Inspectors of Election to also satisfy the criteria of who may be an independent third party.

SB 981 AUTHOR: Archuleta SUBJECT: Email Delivery of Documents STATUS: In Senate Rules POSITION: Watch SUMMARY: Would require an association to deliver

documents by email unless a member has not provided a valid email address. Requires an association to make a good faith effort to acquire member email addresses. Additionally requires an association of at least 50 separate interests to maintain an association website, with certain exceptions.

SB 1340 AUTHOR: Wilk

Subject: Inspection of Decks and Balconies Status: In Senate Housing Position: Watch SUMMARY: Existing law requires an inspection of exterior elevated elements and waterproofing in an association. This bill would eliminate the prohibition against the contractor performing the inspection from bidding on the repair work.

ECHO journal | May/June 2020

21

THE SELF-MANAGED HOA

Hiring for Success: Finding the Right Management Fit The best recruiting advice I have ever received is “if you think it’s expensive to hire a professional, wait until you hire an amateur.” I don’t know who to credit with the saying, but it is just as true as always hitting 16 in blackjack! It never fails!

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May/June 2020 | ECHO journal

BY JOHN CLIGNY, AMS, CAMEx, CCAM-HR

M

oreover, an argument can be made that the primary duty of the self-managed association’s board of directors is the recruitment and hiring of the chief executive, general manager, or manager.

The COVID-19 pandemic has reinforced for self-managed associations the importance of professional executive or management leadership, especially in times of crisis when association and board policies and procedures must be flexible and temporarily modified so that association governance can continue and the association meets its obligations to the community. Martin Luther King stated that “the ultimate measure of a man is not where he stands in the moments of comfort, but where he stands at times of challenge and controversy.” The self-managed association’s board of directors must recognize that times of challenge and controversy validate recruitment and hiring decisions.

Recruitment and hiring of community association management executives is a serious process with wideranging implications for both good and bad and cannot be rushed. A wellrespected talent recruiter told me anecdotally that “the only thing worse than no hire is a bad hire.”

A misstep in recruitment and faulty decisions in hiring can lead to board of director and community frustration, paralysis, legal action and general bad feelings and finger-pointing.

All in all, a waste of community resources

and board time. Avoiding a bad hire and increasing the odds that the right candidate is recruited and hired requires preparation, planning, implementation, and perseverance.

PREPARATION. Recruiting a community management executive starts with a deliberate and objective evaluation of past management successes and failures, as well as a review of the board’s expectations and objectives for community management. The board may consider appointing a search committee or engaging competent recruiting professionals to facilitate this important process. Board and community expectations for the community management executive must align with the realities, resources, and financial strength of the community. Spend time thinking about what makes your community attractive to candidates and develop material to introduce and inform potential candidates about your community. At the end of this preparation process, the board will have a good understanding of its expectations, requirements, and budget for a successful community management executive. Don’t underestimate the amount of time the preparation period will take, this is a foundational first step and requires discipline and commitment from board members.

PLANNING. The planning process is the roadmap for recruiting, interviewing, and selecting qualified candidates. The planning process includes the development of the job description and specifications, the development of candidate qualifications and requirements, development of the employment terms, compensation, benefits, and contract requirements. During the planning phase policies and procedures for how and when the search will be conducted, and the process for reviewing and vetting letters of interest or resume submittals will be determined and how interviews will be scheduled and conducted. During this phase consider how to ensure the recruitment process is fair and equitable and how to include and be transparent to community members.

IMPLEMENTATION, THE FORMAL SEARCH. Having prepared and planned for successful recruitment and Continued on page 24 ECHO journal | May/June 2020

23

The Self-Managed HOA Continued from page 23

hiring, the formal search begins.

Establish a firm search start and ending date, be specific with timelines, and consistently enforce deadlines. Take time to review and evaluate your preparation and planning along the way.

ECHO and other community management resources can provide options for publicizing your search and reaching qualified candidates. As letters of interest and resumes are submitted, review them carefully, and begin to develop a list of questions to dig deeper into candidates’ backgrounds, qualifications, and experiences. As a final list of qualified candidates is selected, consider how to conduct interviews and allow candidates to see the community and meet and engage with committees,

community members, staff members, or employees.

Perseverance is “persistence in doing something despite difficulty or delay in achieving success.” Successful recruiting and hiring cannot be rushed.

Especially in the hiring of a community management executive. The executive will be charged with implementing the strategic goals and policies of the board of directors, and in many cases leading a team of staff members, vendors, and service providers to effectively manage the community association for the benefit of its members. In my experience, the recruitment, and hiring of a community management executive can take up to 12 months depending on the size of the community, candidate qualification requirements, and job specifications. By taking

your time and being diligent in the preparation, planning, and implementation phases the board can be confident that it is meeting its responsibility of duty of care for the community and its members.

For additional information, tips, and tactics for successful recruiting and hiring contact ECHO. John Cligny, CAMEx, CCAM-HR, AMS, is the co-founder of Association Consulting Group and is a veteran portfolio manager and industry thought leader. John advises and educates HOA clients and management companies on a wide range of community management topics and provides expert testimony in litigation.

Echo membership benefits you and your HOA. Join today!

OUR MISSION STATEMENT Fostering a better quality of life in community associations through education, advocacy and networking.

For more information visit www.echo-ca.org 24

May/June 2020 | ECHO journal

What to Do When Your HOA Has No Functioning Board of Directors

By Kara L. Wild, Esq.

M

embers of a homeowner’s association commonly receive periodic letters or postings from the board governing the HOA. One common complaint is: “Why are they bothering me? I pay my monthly HOA fee, don’t I?” What if an HOA does not have a governing body?

For example, what if the president were the only board member, making binding decisions on behalf of the rest of the HOA? That would not only be wrong, but also illegal. Under California Corporations Code § 7210, an HOA must have a governing board. That board must hold regular meetings and a quorum (a majority of directors) must be present to conduct any business. Cal. Corp. Code § 7211(a)(8). If the bylaws of an HOA require five directors and only one or two remain, the only power the remaining board members

have is to appoint new members to fill vacancies until there is a quorum. Cal. Corp. Code §§ 7211(a)(7)-(8), 7224(a). The board has a legal duty to represent the HOA at large, not serve one individual’s whims.

These types of cases probably exist because no one, not even the board president, has bothered to read the bylaws. Instead, the HOA members behave like tenants in an apartment complex, believing that their only obligation is to pay monthly “rent” while the property manager makes all of the decisions and deserves deference. There may not have been any board meetings or annual meetings for years, even though both are required by law. (See Cal. Corp.

Code § 7510.) Though members may be frustrated by rising monthly assessments, they would have Continued on page 26 ECHO journal | May/June 2020

25

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Continued from page 25

no opportunity to voice their concerns due to no meetings.

For HOA members who find themselves in this type of situation, here are some steps to help get their HOA back on track.

Appointment Power First, if the current HOA president is merely ignorant of the law, HOA members can coax this individual to use his or her appointment power to appoint members to fill vacant spots until there is a quorum. While it would be ideal to elect new directors, if the membership as a whole is disengaged, it could be extremely difficult to reach the voting quorum required by the bylaws. When HOA members need a functioning board quorum in order to conduct business, the 26

May/June 2020 | ECHO journal

• Governing Document Interpretation • Governing Document Revisions • CC&R and Rules Enforcement

easiest way is to find one or two HOA members willing to serve and appoint them.

What if the remaining board director is either too disengaged to be reached or, worse yet, consumed by power? Under these circumstances, HOA members have the following options: 1. PETITION FOR RECEIVERSHIP.

In a desperate situation, an HOA member can go over the board director’s head and petition for a receivership.

When there is no board, an HOA member must petition the superior court to appoint a third party to manage the association pursuant to California Code of Civil Procedure § 564(b)(9). Once appointed, the receiver has the power to run the association, including, but not limited to, collecting monthly assessments.

The downside, of course, is that

an HOA in receivership loses control over the amount of the assessments and over the services being provided. Further, the HOA is required to pay the receiver for his or her services.

By contrast, volunteering to be a board member is a much smaller headache.

2. ELECTION AT ANNUAL MEETING. If the HOA holds annual

meetings, an HOA member can try to ensure that enough owners are present to constitute a voting quorum. The number of voters constituting a quorum is set by the bylaws. Pursuant to California Corporations Code § 7512(a), the quorum is usually no less than one-third of the membership, though the bylaws may set a higher threshold. If HOA members cannot achieve the quorum required by the bylaws, they could try to petition a court of appropriate jurisdiction to accept the number of owners who attended as a voting quorum.

Cal. Corp. Code § 7515(c). Only the “owner of a separate interest” can vote; not the owner’s spouse or anyone else who is not on title. Cal. Civ. Code § 4160.

3. CALL A SPECIAL MEETING.

If the HOA is so dysfunctional that it does not even hold annual meetings, individual HOA members have the power to call a special members’ meeting pursuant to California Corporations Code § 7510(e).

Calling a special meeting requires only that they get a petition signed by five percent of the members. In a small HOA, that may be as few as two people.

If HOA members are able to exercise the second or third option, they should be on the right path. Their HOA would have enough directors on the board

to reach a quorum and legally conduct business. The HOA would be out of immediate danger.

Educating the HOA is how to prevent this from happening again. At board meetings, HOA members should stress the importance of reading their bylaws and familiarizing themselves with their Covenants, Conditions, and Restrictions (CC&Rs). Most HOA members probably put these documents away in a drawer when they purchase their homes and never look at them twice. They are certainly not easy reading – drafted by lawyers, the text is usually dry and formal.

Notwithstanding, all HOA members should have at least some familiarity with what their governing documents require.

If the HOA membership as a whole is still too disengaged to attend board meetings, individual members may need to resort to greater measures, such as a newsletter or in-person efforts to talk with their neighbors. If even a handful of people remain interested and engaged, the HOA may have enough of a cushion to sustain the loss of one or two board directors.

Kara L. Wild, Esq. is a Senior Associate at the law firm Ericksen Arbuthnot in their Oakland/East Bay office.

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NEW PROFESSIONAL SERVICE PROVIDERS

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New Professional Service Providers If you’re a property owner or homeowners association member looking for quality pest management solutions for your community, Accurate Termite and Pest Control is proud to offer a comprehensive list of commercial services to meet the individual needs of our customers. Our HOA services are utilized in over 200 homeowner associations in the Los Angeles, Orange County, and San Diego areas – all with local crews and offices.

You can be assured that our staff understands the protocol and use of the proper communication channels when keeping board members and their managing agents informed.

Accurate Termite and Pest Control staff members understand that every HOA has different CC&Rs, Rules and Regulations and specific service needs.

All services performed in HOAs are catered to the community’s needs.

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AllPro Association Management is a leading full-service management company with an emphasis on excellent customer service, easy to read financials and CAI-certified, experienced managers who will work with your board to ensure your association is run at maximum efficiency.

We understand the obligations the board has to the community to ensure property values are maintained, that the association runs within budget and homeowners are “in the know.”

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May/June 2020 | ECHO journal

Our goal in managing your community is to streamline your processes, ensure you have the best vendors working at your project at the best cost, the board is educated and homeowners are happy with the services they are provided. This approach has led to better-run HOAs, less stress for boards and increased homeowner satisfaction overall within the community.

We listen to the concerns and needs of the board and community and collaborate to form a custom management plan ata n affordable cost. We care about the communities we manage and are ready to discuss your needs.

Alex Karkov ClientRelations@AllProHOA.com | 877.255.7761 www.allprohoa.com

B2R’s team of experienced and licensed architects and engineers bring decades of experience providing building inspections, property condition assessments and reports, damage assessments, SB800 inspection, and building expert consultation. Our many years of experience uniquely qualifies us to provide minimally invasive and costeffective inspections and reports on the condition of exterior elevated elements.

Our focus is responding to the requirements of SB 326. Our services will keep your communities in compliance with the inspection and reporting requirements of the new law via a variety of fee structures that minimize the financial impact to the Associations. The health and safety of your property owners and their guests is our priority.

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Kirk Miller Insurance is proud to serve the San Diego area as your local Farmers® agent. Having served the insurance industry for over 13 years, we have the knowledge and experience to help you better understand your coverage options!

Helping customers identify the insurance coverage that best fits your needs is something we pride ourselves on. This process is straightforward and personalized to help make you smarter about insurance. Neighborhoods served include Carlsbad, La Jolla, Rancho Santa Fe, Del Mar, and Encinitas.

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Email us: info@B2Rconsultinggroup.com www.B2RConsultingGroup.com ECHO journal | May/June 2020

29

The New Normal IN COMMUNITY ASSOCIATIONS This article, read through the thin veil of a coveted N-95 mask, neck gaiter, handkerchief, cut-up shirt, or an old pair of garments, indicates the new norm for 2020. COVID-19 has wreaked havoc on the American economy, disrupted lives, and the management of associations. From the onset the most common question related to association management and COVID-19 is ‘how to handle association management in a pandemic’.

Laws, codes, covenants, and rules govern associations, which makes the answer complicated; but there is an answer.

From attached buildings, to shared walls, to community amenities, there is no question homeowners and board members are living in the close-quartered living environments in which COVID-19 thrives and propagates. Homeowners and boards can institute commonsense protocols to temporarily limit exposure, risk to the association while facilitating, as best possible, the enjoyment and safe living within the community.

In associations, board members are arguably at the highest risk of exposure. Board members are frequently stopped by community members or staff for business or simply to socialize. A board member may get stopped at a grocery store, going to the car, or checking mail.

An angry resident may, at times, be susceptible to being yelled at well within the government social distancing guidelines of 6 feet. So, how should a board react to these new “threats” and still conduct business

30

May/June 2020 | ECHO journal

BY DEREK MOBRAATEN, CCAM-PM

and engage with residents while the stay in place order is still in effect? As for conducting business, the most important limitation imposed because of the COVID-19 stay at home order is how to conduct board meetings which are usually done in person.

The Open Meeting Act, in its definition, prohibits board members from holding meetings via teleconference, email, or in an otherwise inaccessible way for homeowners to attend remotely. When the Governor of your state or the County where the HOA is located mandate that everyone stay indoors, save for certain essential activities and jobs, such as grocery shopping and medical workers, maybe the rule book needs to be taken less literally and best judgement rule.

It is true, association management firms are considered an ‘essential business.’ Vendors need to repair plumbing leaks, roofers must fix leaks, arborists cut tree branches when health and safety are of concern. These are essential businesses. How can HOA management conduct business during an extended period due to continued restrictions required by politicians and enforcement agencies as a result of the COVID-19 pandemic?

Board meetings are integral to the business of an association. They are mandated based on the needs of that association and actions required.

Instead of postponing a board meeting in a time like this, hold a board meeting remotely but use a software that either enables homeowners to call in to the meeting, or even better, allows for video conferencing for those who wish to participate. Many options are available and the features are impressive. Some have the option to mute individuals who may talk out of turn or speak longer in homeowner forum than the time they are allotted.

Of course, this violates the open meeting act because a location to meet hasn’t been established but these are unique times and for the health and safety of the community and especially when government officials mandate social distancing, a judge would likely side with the best health and safe interest of the community over that of the procedural requirements of the law.

Another unexpected problem which the COVID-19 pandemic has created is mail. Associations receive and send a lot of mail. Without it, there would be no way to notify the membership of important disclosures that are mandated by law. The problem is people may not want to wait in line at the post office to mail documents that the membership needs to receive.

A workaround for this problem lies in securing email consent forms from homeowners. Email consent forms allow homeowners to approve having correspondence sent to them via email.

Continued on page 32

ECHO journal | May/June 2020

31

As the adoption of modern technology evolves and board members and homeowners become familiar with remote meetings, there is a good chance that associations will run more smoothly and efficiently with greater engagement of homeowners.

The New Normal Continued from page 31

If your association does not have a way for members to be notified through email, an association may not have a way to notify the membership of important updates, say, for example, how to communicate with the agent or board member of an association during the pandemic. Email consent forms can be a very valuable tool if used properly. Some homeowners might be reluctant to provide their email for fear of someone ‘selling their email’ to advertisers, etc.

The consensus seems to be that smaller association management companies, and those associations that are self-managed, cannot use the email address of homeowners in any way other to communicate association related information.

Further, under the concerns about COVID-19, sending mail physically could be a very difficult problem. Anyone with a completed annual budget for an association is most likely imagining what this pandemic will be like when budget time rolls around, which for most, is in November. Fortunately, there are several very impressive reproductions and copy service companies that offer mailing and postage services which the association may use. In other words, if a board has approved and completed an annual budget and it is ready to be mailed to the membership, not only could the budget be emailed, as mentioned earlier, it might be appropriate to send the mailer to a reproduction and copy service. These companies will make the correct number of copies and mail them to the membership list saving the management company from handling the physical correspondence. There is a timing risk to outsourcing association official mailings. It is possible that there 32

May/June 2020 | ECHO journal

is not enough time for the order to be processed and mailed, which could result in a missed deadline such as a 30-day comment period, a budget deadline mandated in CC&Rs and new election law deadlines... and the list goes on.

The COVID-19 pandemic has disrupted all facets of community management. Board members and some homeowners may have much busier schedules and may be less available to help with the management of the association. This could be taxing on all those involved with trying to get things done. Technology provides a partial answer. Online business, including board meetings and annual meetings, may be able to use an electronic platform satisfactorily and keep the business of the HOA moving ahead. It can be cumbersome at first, and in some ways risky, there is no telling how long this pandemic will last. As the adoption of modern technology evolves and board members and homeowners become familiar with remote meetings, there is a good chance that associations will run more smoothly and efficiently with greater engagement of homeowners. Electronic platforms have weaknesses, but so do paper, inperson meetings and mail. Everything is a risk when managing an association but at this time, it might be worth associations considering new means of communication for association business. The result might be a pleasant surprise.

With over seven years’ experience, Derek and his wife, Kaley, operate Hudson Management out of Pleasant Hill, California. He is a recognized leader in the industry while managing a staff of association management veterans. He holds a CCAM-PM and is a frequent contributor to Echo publications.

Executive Director’s Message Continued from page 6

Guidance on Relaxing Stay-in-Place Orders

• Make sure the activity is compliant with the law.

• Determine the health and safety risk (potential to transmit the disease) level of the activity.

• Establish rules, following federal and state guidelines, to mitigate the health and safety risk of the activity such as wearing masks and 6-foot distancing.

• Consider new rules to make the activities safer during the pandemic such as only allowing singles tennis and forbidding doubles and allow only pull carts and the carrying of bags when golfing.

• Ask for a waiver of liability from participants.

• Require training and perhaps certification in order to use a facility – like the process commonly used for work out and weight rooms.

• Require participants to be registered for an amenity which may be revoked for any reason, at any time including failure to properly adhere to safety guidelines.

• Reserve the right to stop the activity if there are persistent violations.

• Be prepared to enforce the new requirements, rules and regulations.

• Consider emergency rules to ensure the policies and requirements are followed and they have teeth.

• Enforce the rules.

INDEX OF ADVERTISERS

Ace Property Management..............................................14 AllStar Painting & Maintenance, Inc............................27 Applied Reserve Analysis..................................................14 Benjamin Moore Paints.......................................................14 Berding | Weil, LLP............................................................ 20 Boland Insurance...................................................................13 B2R Consulting Group.......................................................29 Cagwin & Dorward Landscape Contractors...........27 CIT Bank.....................................................................................12 Heritage Bank of Commerce...........................................14 IQV Construction & Roofing...........................................26 Levy, Erlanger & Company, LLP....................................35 Rebello’s Towing Services, Inc......................................... 2 White & MacDonald, LLP..................................................26

Visit the Echo website for event registration and more information. www.echo-ca.org ECHO journal | May/June 2020

33

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RESCHEDULED! NEW DATE!!!!

Saturday, August 15, 2020 Santa Clara Convention Center CLICK HERE TO REGISTER Echo and the Santa Clara Convention Center are taking extraordinary precautions to protect against the transmission of COVID-19 during this event, including limiting attendance, social distancing and increased sanitation of the facilities.

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