By: AJ Jahanian, Esq.
We wanted to share a quick, positive update regarding Senate Bill 1007 (SB 1007), introduced earlier this year by the State Legislature.
Quick Recap: SB 1007 proposed significant changes to how homeowners associations handle regular assessments. Among its main provisions, the bill would have capped annual increases in regular assessments at 8% without a vote of the membership. Any increase above that amount would have required approval by a majority of a quorum of members.
The Good News: The bill’s author requested that the scheduled hearing before the Assembly Housing and Community Development Committee (set for June 24, 2026) be canceled. As a result, SB 1007 is no longer moving forward this legislative session. This outcome is welcome news. It preserves the practical flexibility volunteer boards and managers need to address real-world cost increases—such as insurance premiums, maintenance, and reserve funding—without unnecessary procedural hurdles.
Developments like this show how effective engagement with legislators can be. Many boards, property managers, and industry groups (including through organizations like CAI-CLAC) shared practical concerns about the potential impact on community finances and operations. Your voices and collective advocacy truly make a difference in Sacramento. We encourage you to stay informed and involved whenever HOA-related bills arise—it helps protect balanced governance for all common interest developments.
What This Means for Current Law: Current law remains unchanged. Under California Civil Code § 5605(b): “the board may not impose a regular assessment that is more than 20 percent greater than the regular assessment for the association’s preceding fiscal year … without the approval of a majority of a quorum of members…”
In plain terms, boards continue to have the authority to increase regular assessments by up to 20% over the prior fiscal year’s level without requiring a membership vote (provided you comply with the required annual budget notice and disclosure rules under Civil Code § 5300 et seq.). Increases beyond 20% still need member approval.
We will continue to monitor legislative activity closely and will provide timely updates on any new developments that could affect your associations. If your board is preparing a budget, considering an assessment adjustment, or has questions about compliance, please reach out to us—we’re here to help ensure everything is handled properly and effectively.
AJ Jahanian, Esq. is a Shareholder with Beaumont Tashjian, where he advises boards and managers on Civil Code, Fair Housing compliance, elections, governing documents, contracts, and dispute resolution.
