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Senate Appropriations Committee due-passes SB 12 38 to protect HOA homeowners; vote 5-1
Summary
The Senate Committee on Appropriations voted 5-1 to due-pass SB 12 38, a measure Senator Wahab said would require HOA managers to meet a duty of care, restrict certain reserve uses, and improve inspection-rating transparency; sponsors estimate a one-time Department of Real Estate cost of $50,000.
Senator Susan Talamantes Eggman Wahab (Senator Wahab) asked the Senate Committee on Appropriations to due-pass SB 12 38, saying the bill "will protect homeowners who reside in communities with homeowners associations by requiring additional disclosures to the homeowner, ensuring HOA managers and board act in the homeowners' best interest." The bill would require HOA managers to provide a duty of care and a highest good-faith effort to the association and its members, clarify that HOA reserves are not to be expended on certain litigation already governed by existing law, and make inspection ratings transparent and understandable for homeowners.
Jennifer Speck, Vice President of Public Policy and Advocacy for the California Association of Realtors, testified as a sponsor, urging the committee to vote. "We're proud sponsors of the bill," she said. Committee staff noted the Department of Real Estate estimated a minimal one-time cost of $50,000 to implement the measure.
Senator Richardson moved that SB 12 38 be due-passed to the Senate floor. The committee called the roll and recorded the following votes: Cervantes, aye; Cabaldon, aye; Grayson, aye; Richardson, aye; Wahab, aye; Searto, no. The chair announced a final vote of 5 to 1. The motion passed and SB 12 38 will be reported to the Senate floor as due-passed.
The committee handled the item under the appropriations "due pass" procedure and did not hear Department of Finance comment, the chair said. No amendments or further committee directions were recorded during the hearing. Next steps will be transmission of the measure to the Senate floor for further consideration.
(Reporting note: the committee record lists the sponsors presentation and the roll-call tally; departmental implementation cost was described as a one-time estimate to the Department of Real Estate.)
