HOA Blog - California
Our HOA Blog is added to several times each month so please visit it often. If you would like to respond to any blog, please contact us. Our HOA Articles are also added to and updated regularly.
Neighborhood Councils in the City of Los Angeles are city certified local groups made up of people who live, work, own property, or have some other meaningful connection to a neighborhood located within Los Angeles. There are 99 Neighborhood Councils within the city governed by elected boards. The city provides each Council with funds each year. Neighborhood Councils are not homeowner associations.
When board members pay vendors and contractors with their own funds and then seek reimbursement from the management company, it creates accounting and liability issues. Under these circumstances, the vendor or contractor rarely submits his or her proof of license, proof of insurance naming the association as additional insured, and a W-9 form so the association can report the amounts paid to the IRS and FTS. All payments to vendors and contractors should be made by the management company in order to assure legal compliance and to minimize the association’s exposure to liability. See: How Coast Management of California Processes Invoices.
We are not aware of any lenders that accept completed lender’s questionnaires or even copies of documents from board members. Their concerns are the inability to sell loans
in the secondary market and possible fraud. Lenders know that HOA management companies are reliable sources of authentic documents and an accurate source of unbiased truthful information. See: Lender’s Questionnaire – Purpose.
W-9 forms are required to be submitted to the management company by all vendors and contractors before payments can be made. This applies to all invoices submitted regardless of the amount and regardless of whether the party is incorporated or not. This policy is intended to protect our management clients.
In California, open flame cooking devices, including charcoal and propane grills, may not be operated on combustible balconies or within ten feet of combustible construction except for (1) One and two family dwellings, and (2) When buildings, balconies, and decks are protected by an automatic sprinkler system. In addition, propane containers with a capacity of over one pound cannot be transported through enclosed common area stairs, hallways, or elevators They must be transported into a unit through an exterior stairway or not at all. Boards should create appropriate operating rules and amend their association’s CC&Rs if needed.
Under prior law, unlicensed individuals could perform construction work if the total cost of labor, materials, and other project expenses did not exceed $500. Under AB 2622, the threshold was raised to $1,000, effectively allowing unlicensed persons to handle more small jobs without violating the California’s Contractors State License Law.
The new exemption applies only if no building permit is required. If the scope of work triggers a building permit (electrical rewiring, plumbing changes, or structural modifications) an unlicensed person cannot legally accept the job. In such cases, a licensed contractor is mandatory.
Also, unlicensed persons under the exemption cannot employ any other person to perform or assist with the work. When another person is brought on board whether paid or unpaid, the exemption no longer applies, and a contractor’s license is required.
Mortgage interest rates have declined this last month and are continuing to fall. This is a good time to contact a mortgage broker about refinancing. See: Reasons to Use a Mortgage Broker.
If you want to save money when paying assessments, you can instruct your bank to pay your monthly assessments from your checking account. Most banks offer this service at no cost. You must simply provide them with the name of the payee which is your association and our mailing address: Coast Accounting Office, 5737 Kanan Rd. Suite 630, Agoura Hills, CA 91301. For most associations, assessments are due on the first day of the month and delinquent if not received by the 15th. To be absolutely safe, we recommend that assessment checks be mailed on the 1st. This arrangement is convenient, avoids late fees, and even eliminates the cost of postage and envelopes.
Note that if your building is serviced by Southern California Edison, you may sign up for outage alerts. This way, you will receive notices well in advance: sce.com
When members of homeowner associations make a direct claim on their association’s master insurance policy that is either frivolous or clearly not covered, it has a long-lasting negative effect on the association and its members that will likely increase the premiums charged or result in a non-renewal notice. Unfortunately, associations in California cannot prevent members of associations from making direct claims on master policies. Many owners do not understand the consequences of these claims and some simply don’t care.
Coast Management of California
818-991-1500