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HOA Homefront Reader Questions: Solar Energy
SOLAR ENERGY
By Kelly G. Richardson, Esq. CCAL
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Banning Solar Installations in Our HOA?
Can a HOA prevent us from placing solar panels on the roof of our townhome? We are in an older condominium association and the roofs are hard, flat shingles that were just replaced. If we agree to be responsible for the repairs needed due to our solar panels (not the ultimate roof replacement in another X years or whatever), do we have the right to place solar panels on the roof above our townhome? – Looking forward to your answer, M.F.
Dear Kelly:
Can my HOA deny me from installing solar panels on my roof?
– M.H.
Dear Mr. Richardson:
I submitted a formal application to my HOA Architectural committee for the installation of solar panels on my roof, believing that the Civil Code section 714 is quite clear that my application can be “reasonably” restricted but not denied. I have since heard that the HOA lawyer advised the Board that they could, in fact, deny my application if they were to come up with “3 good reasons.” Does this sound plausible to you? Where exactly is the law on rooftop solar in common interest developments? – Best, R.O.
Dear M.F., M.H., and R.O.:
California’s strong preference for solar energy installations is reflected in three Civil Code statutes, Sections 714, 714.1, and 4746. Section 714 prohibits governing documents from banning solar installations but allows the imposition of “reasonable” restrictions. However, the term “reasonable” persubparts (b) and (d)(1)(A) means restrictions which do not decrease the system’s efficiency by more than 10% or increase its cost by 10% or $1,000 (whichever is less).
Furthermore, Civil Code Section 714.1(b)(1) prohibits HOAs from prohibiting installations on the roof of one’s home, carport, or garage. This means that, even though a townhouse condominium roof is normally common area and not individually owned by the unit owner, the HOA cannot completely ban solar installations on those common area roofs.
The statutes specially allow certain requirements, which are listed at 714(c) and 714.1(a). The installation must meet all applicable codes, the homeowner can be required to indemnify the HOA from any loss or damage arising from the system and to maintain, replace, or repair the roofs under the system. Section 4746 also allows the HOA to require that the installer be properly licensed and for the homeowner to keep insurance in force if the installation is on a shared roof.
Solar system applications are required by Section 714(e) to be handled like any other architectural application and are automatically deemed approved if the HOA has not approved or denied the application within 45 days (absent any reasonable but unresolved questions from the HOA).
HOAs need to exercise caution regarding solar system applications. HOAs found willfully violating this statute can be ordered to pay a civil penalty of up to $1,000, and the prevailing party will be awarded their legal costs.
So, R.O., I disagree with your HOA lawyer’s (reported) comment that the HOA only must come up with “3 good reasons” to deny a solar installation. The allowable reasons are right in the statutes, and if they aren’t listed, they are suspect at best. – Thanks for your questions. Best regards, Kelly
Have a Policy Regarding Solar Energy Installations
As the cost of energy escalates seemingly weekly, an increasing number of HOA homeowners want to install photo voltaic systems on roofs. Here are some key considerations for boards to consider.
Is the HOA prepared? Reasonable rules regarding solar installations will help both homeowners and the HOA. Such rules must be carefully crafted to ensure compliance with Civil Code Sections 714, 714.1, and 4746. Such rules should address issues including:
Time limits. Under Civil Code Section 714(e)(2)(b) if the application is not approved or denied within 45 days (assuming there are no pending unanswered questions), the installation is DEEMED APPROVED. Have the time limits in the rules.
Code compliance. Civil Code Section 714(c) allows HOA rules to require compliance with health and safety and electrical codes.
Roof repair. The HOA may require that the applicant pay for roof component damage from the installation and ongoing use of the system, per Civil Code Section 714.1(a). This may also include the extra cost of removing the system when the roof needs maintenance or replacement.
Common area roofs. If the installation is in a condominium, in which the roof is normally common area owned in common by all owners, Civil Code Section 4746 allows applicants to be required to submit a “solar site survey” plan and to notify other owners in the same building. The solar site survey plan will be quite simple if the system is only to be installed on a roof or carport serving a single residence, but a multi-story apartment-style condominium building will need a more sophisticated plan showing that the applicant is proposing only to use their fair share of the usable space on the shared common roof.
Recordable agreement. HOAs under Civil Code Section 4746(b) can require that subsequent owners of the applicant’s unit be notified of the ongoing obligations regarding the system installed on a common area roof. This is normally accomplished by a written agreement stating the required conditions that is filed with the County Registrar/Recorder (“recorded”) on the unit in question. This will also automatically notify later unit owners that they are bound by the agreement.
Insurance. If the system is to be installed on a common area roof, the HOA can require proof of insurance (Civil Code Section 4746(a)(2)), which is annually updated to the HOA.
Leasing. Some companies offer to install solar systems under a lease. The installation of a leased system on common area roofs can create huge problems for the HOA and for subsequent unit owners. The leasing company is not subject to the governing documents since it is not a member. After installing its system, leasing companies often sell the lease to finance companies. If the unit sells, the leasing company must consent to the new lessee. The seller could be liable for the cost of the lease if the buyer does not assume that liability. There is nothing in the applicable statutes that requires the HOA permit leased systems to be installed upon common area roofs. The potential problems for the HOA and the future owners can be prevented by not permitting leased equipment to be installed upon common area roofs.
Solar energy generation is the present, not the future. Be prepared with reasonable written policies.
Solar Installations
I live in a planned development, and was told we could not install solar because it would void our roof warranties. Can our management company ban installation of solar because of that reason or do the new regulations override that argument? – Thank you, D.D.
Dear D.D.:
Civil Code Sections 714 and 714.1 do not provide for HOAs to ban solar installations because they allegedly void roof warranties. However, keep in mind that the HOA can hold you responsible for damage to the roof. So, the HOA cannot reject your solar installation request because of the roof warranty, but it may hold you responsible for damage to the roof. Also, management doesn’t make decisions, they carry out board decisions. – Best regards, Kelly.
Hi, Kelly.
I applied for installation of a solar system. My HOA requires installation of pigeon deterrents or critter guards, at a cost of well over $1,000 extra. We think that “pigeon deterrent” should be at owner’s option and cost and the HOA shouldn’t make it compulsory for approval. Please advise when the installation of pigeon deterrent
Dear J.M.:
Per Civil Code Section 714(d)(1)(B), an association cannot impose a requirement which adds more than $1,000 cost to the system. However, the HOA can hold you responsible for damage to the roof if the installation allows pigeons or other animals to damage the roof, per Civil Code Section 714.1(a)(4). Even though the HOA cannot force you to have the guards, if it prevents damage to the roof (which damage will likely be your responsibility), it might be a good idea to include it anyway. – Sincerely, Kelly
Dear Mr. Richardson:
As per CC&Rs, we do not own our own roofs in our complex. Does the law force us to allow solar installation?
Dear R.T.:
Civil Code Section 4746 provides guidance regarding installation of common area roofs. The HOA cannot deny solar installations because they would be on common area roofs, but homeowners can be required to procure and submit a “solar site survey” documenting that the installation will only use a fair share of the useable roof area. In townhouse-style condominiums the roofs are usually common area but the area fairly allocable to the owner is clear — the roof above their own residence. In an apartment-style building, in which condominium units are stacked in multiple stories, the available roof space is more scarce. In that configuration the solar site survey may reveal that the requesting party’s fair share of the roof is too small for a meaningful amount of solar panels to be installed. So, as a technical matter, yes, the law forces HOAs to allow solar installations, subject to important conditions, but as a practical matter it is more likely that apartment-style condominium projects the unit owners will not find it as valuable. Given that townhouse condominium owners can use the area over their home as their “fair share” of the common area roofs, it is more likely that the HOA will be forced to allow solar installations on townhouses. – Thanks, Kelly
