*2003 |
| SB1879 | (eff. 9/21/02* interim measure) On January 1, 2002, legislation took effect requiring most sellers of residential one-to-four-unit properties to request from local agencies, and then disclose to buyers, information regarding assessments levied under the Improvement Bond Act of 1915—a method of financing certain public improvements. Recognizing that local agencies would be slow to respond to this legislation, C.A.R. sponsored SB 1879, effective September 21, 2002, which allows sellers to comply with this disclosure requirement by providing a "substantially equivalent" notice to buyers (including a recent tax bill or an itemization of current assessments, such as a title report). In other words, SB 1879 allows a seller to disclose bonded assessments in either manner—by obtaining a notice from a local agency (if available) or via a substantially equivalent notice. |
| AB337 | (eff. 1/1/03) In addition to SB 1879, discussed above, C.A.R. sponsored legislation which affects both disclosure of assessments levied under the Improvement Bond Act of 1915, and disclosure of special taxes imposed pursuant to the Mello-Roos Community Facilities Act (which finance public facilities and services). As with 1915 Bond Act disclosures, most sellers of residential one-to-four-unit properties must request, and then deliver to buyers, Mello-Roos tax disclosure notices obtained from local agencies. Recognizing that sellers now often rely upon third-party disclosure companies to assist with their disclosure duties, AB 337 clarifies that sellers may comply with both of these disclosure requirements by providing notices obtained from private entities. (Sellers still have the option of obtaining notices from local agencies if desired.) Additionally, AB 337 provides disclosure companies and other private entities with guidance in fashioning 1915 Bond Act and Mello-Roos disclosure notices for their customers that fully comply with all legal requirements. |
Airport Noise Disclosure (eff. 1/1/04*)
| AB2776 | In response to growing concerns over the impact that airport activities can have on homeowners, California has enacted legislation, effective on January 1, 2004, designed to alert potential purchasers to neighboring airport influence areas. The disclosure of these areas will occur in several ways. First, a subdivider applying for a public report will have to include in his or her notice of intention a specific notice disclosing that the property is within an airport influence area. Similarly, common interest development declarations recorded after January 1, 2004 must include this same notice. Finally, disclosure companies and other experts who prepare natural hazard disclosures will be required to include the notice in their reports, and such reports will be deemed "substituted disclosures" in compliance with the Real Estate Transfer Disclosure Statement law. Except for a revised introductory paragraph in the Transfer Disclosure Statement that refers to the change in NHD reports, AB 2776 will create no new disclosure requirements directly impacting REALTORS®. Again, AB 2776 does not become operative until January 1, 2004. |
| AB2065 | Effective January 1, 2003, AB 2065 changes the tax withholding requirements for sales of real property in California (the California Foreign Investment in Real Property Tax Act, or "Cal-FIRPTA"). As originally drafted, Cal-FIRPTA generally requires buyers to withhold 3 1/3% of the sales price of real property and forward the proceeds to the Franchise Tax Board, but only if the funds are to be transferred to an out-of-state seller or to the seller's financial intermediary. AB 2065 expands the withholding requirement to apply to sales by California residents and non-residents alike. Fortunately, AB 2065 exempts various transactions from the withholding requirement, including sales of principal residences, 1031 exchanges, involuntary conversions, and sales resulting in a loss. In addition, withholding on sales by corporations, LLCs, irrevocable trusts, and certain other sellers, generally remain subject to more traditional withholding requirements that turn on the seller's residency. The difficulty that AB 2065 presents for individual sellers is that they cannot request a reduction in the amount of the withholding that would limit the amount to the approximate tax that will be owed. Instead, the withholding is to be calculated on the whole sales price. While AB 2065 does not impose any new taxes or increase existing taxes, it does accelerate tax payments by some property owners. For more information, please see C.A.R.'s publication entitled, California Withholding on the Sale of Real Property . |
Escheat Notices (eff. 1/1/04*)
| AB1772 | California's Unclaimed Property Law creates comprehensive procedures for dealing with abandoned personal property, including money, deposit accounts, shares of stock, and so on. When someone fails to claim property, the holder of that property may deliver it to the state after a certain period of time (a process known as escheating), but must comply with strict procedural requirements. Concerned that many property owners "lose track" of certain assets, such as bank accounts, California has enacted legislation, effective January 1, 2004, mandating a notice to affected property owners identifying their property and disclosing the basics of the escheat laws. It is believed that this legislation will help property owners better protect their property rights. |
| AB2546 | AB 2546, sponsored by C.A.R., is designed to prevent homeowners' associations from enacting rules that unduly restrict property owners or real estate agents from marketing or showing properties for sale within common interest developments. Specifically, AB 2546 prevents associations from enforcing rules or regulations that would establish an exclusive sale/marketing relationship with a particular real estate broker (except for property owned by the association or common areas). In addition, AB 2546 prohibits an association from charging a property owner a marketing fee that exceeds the association's actual or direct costs. It is anticipated that AB 2546 will curtail exorbitant "gate fees" and "sweetheart deals" which might tend to inflate the costs of purchasing properties within common interest developments. |
| AB2417 | California's Common Interest Development Open Meeting Act provides a homeowner in a common interest development the right to attend meetings of his or her association's board of directors, other than executive sessions. The Act left open several questions regarding the association's obligation to disclose to homeowners actions taken in executive sessions. To ensure greater transparency of board decisions, AB 2417 closes this loophole by requiring matters discussed in executive session to be noted in the minutes of the immediately following board meeting that will be open to the entire membership. |
| AB2289 | Homeowners' associations may collect delinquent assessments from homeowners in a variety of ways, including foreclosure of a homeowner's property. AB 2289 was enacted to provide delinquent homeowners with greater procedural safeguards, and to make foreclosure a last resort for associations, rather than a primary means of assessment collection. The following are just a few of the changes made by AB 2289:
AB 2289 is comprehensive legislation which will be of interest to most homeowners' associations. It should be noted that many of its provisions affecting lien enforcement apply only to liens recorded on or after January 1, 2003. |
| AB643 | Effective January 1, 2003, AB 643 requires a common interest development homeowners' association, whether incorporated or not, to submit an information form to the California Secretary of State, identifying a wide range of information about the development, including the association's name, contact information, managing agent, location, type of common interest development, number of units, and other information. The new law contains different filing deadlines depending on whether an association is incorporated or unincorporated, and restricts the Secretary of State's ability to disseminate the information to third parties. AB 643 also amends the list of information which a seller of a unit in a common interest development must provide to a buyer to include a written statement from the association that the association is not incorporated, assuming that's the case. |
| SB1403 | In 2002, California enacted numerous changes to the state's landlord-tenant laws. Effective January 1, 2003, SB 1403 imposes the following requirements:
For more information, please see C.A.R.'s publication, New Landlord-Tenant Laws for 2003. |
| AB2330 | In addition to the changes made by SB 1403 to California's landlord-tenant laws, discussed above, AB 2330 makes further modifications (also effective January 1, 2003) as follows:
For more information, please see C.A.R.'s publication, New Landlord-Tenant Laws for 2003. |
| AB1866 | California's housing crisis has generated a number of legislative responses aimed at increasing the state's supply of affordable housing. For example, state law currently provides for density bonuses (a right to build a project which will result in residential density greater than that allowed by a municipality's current zoning ordinance and housing element) to developers who meet certain local housing needs, and also regulates the approval of "second units." To ensure the availability of these methods for addressing housing needs, and to prevent local governmental abuses, C.A.R. sponsored AB 1866. This bill imposes more stringent requirements upon local governments attempting to deny density bonuses, and requires applications for second units received on or after July 1, 2003 to be considered "ministerally," without discretionary review or the need for a hearing. |
Lead-Based Paint (eff. 1/1/03)
| SB460 | With concerns growing over the potential health impacts of lead, the California Department of Health Services sponsored SB 460—a bill which strengthens the ability of local agencies to order the abatement of specified lead hazards. The bill contains other provisions regulating providers of lead-related construction work and construction courses, abatement, and evaluation, and requires better reporting by laboratories performing blood lead analysis. SB 460 also designates properties containing certain excessive lead hazards as "untenantable," and thus subject to remediation, under California's landlord-tenant laws. |
| AB2851 | The Mello-Roos Community Facilities Act of 1982 creates a mechanism for financing public facilities and services through the imposition of special taxes. The implementation of the Act is subject to a wide array of statutory regulations which, effective January 1, 2003, are expanded by AB 2851. For community facilities districts formed after January 1, 1992, AB 2851 requires a district to prepare an annual report upon the request of a person who resides in or owns property in the district, summarizing the amounts and disposition of taxes and other moneys collected during the fiscal year. This report shall be made available to the public upon request. |
Telemarketing
| SB771 | "Do Not Call" List for Unwanted Telephone Solicitations (eff. 2001 - included for reference purposes) |
| SB1560 | "Do Not Call" List Amended On January 1, 2002, new legislation took effect directing California's Attorney General to establish, no later than January 1, 2003, a "do not call" list which residential or wireless telephone subscribers can use to block telephone solicitations from many types of businesses. (This law contains a number of REALTOR®-friendly exemptions specifically requested by C.A.R.) SB 1560 extends until April 1, 2003 the date by which the Attorney General must establish the list. The bill makes additional changes to the law, effective January 1, 2003, prohibiting anyone other than the Attorney General's office from selling or leasing the list, and clarifies what constitutes unlawful use of the list. |
| AB870 | Auto-Dialers (eff. 7/1/02*) Some telemarketers use automated dialing technology called "predictive dialers," which are capable of automatically dialing a potential customer's telephone number before one of the telemarketer's operators is available to speak with the customer. When such a dialer calls more quickly than operators can respond, the person called may be greeted by silence—a potential annoyance and safety concern, which also thwarts the ability of the person called to request to be placed on a "do not call" list. To remedy this problem, new legislation, effective July 1, 2002, prohibits anyone using automatic dialers from making calls for which the telemarketer's agent will not be available to respond. However, the Public Utilities Commission may determine an acceptable "error rate" for calls made in violation of this new rule. |
| AB1769 | Cell/Pager Messages Advertising Regulation. In its ongoing attempt to regulate unsolicited advertising, California has enacted new legislation, effective January 1, 2003, prohibiting certain businesses from sending unsolicited text message advertisements to cell phones and pagers. Various exceptions apply. |
| AB2944 | Fax and E-mail Advertising Regulation. The Telephone Consumer Protection Act of 1991 (TCPA) is federal legislation which, among other things, bans unsolicited fax transmissions. In 1998, California enacted its own legislation regulating unsolicited faxes, which differed in several significant ways from the TCPA, and permitted unsolicited faxes under certain circumstances. Effective January 1, 2003, California has repealed its unsolicited fax law, leaving the TCPA as the primary regulation of unsolicited faxes in California. |
| SB2098 | California recently enacted the Toxic Mold Protection Act, which creates various mold and water intrusion disclosure/remediation requirements for commercial and industrial property owners. Compliance with most of the Act's requirements is not required until the first January 1 or July 1 that occurs at least six months after the California Department of Health Services (CDHS) adopts standards and guidelines for dealing with indoor mold problems. (CDHS is scheduled to report its progress in developing these standards and guidelines by July 1, 2003.) As originally drafted, however, a few provisions of the Act applicable to commercial and industrial landlords and tenants apparently were effective on January 1, 2002. SB 2098 clarifies the law, making all of its relevant requirements subject to the former timeframe. In other words, property owners need not prepare for compliance until CDHS adopts standards and guidelines. |
Copyright © 2002 California Association of REALTORS® (C.A.R.). C.A.R. Legal Department. All rights reserved. Revised 12-12-02.
If you require legal assistance, locale a California attorney by visiting one of the legal directories noted below.
Bob Schwartz
619-300-8819
fax: 619-229-0048 Postal address: Bob Schwartz c/o Brokerforyou 7966 Laurelridge Road San Diego, CA 92120
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