Did your HOA raise monthly dues and not tell you about it?

If your HOA Board wants to increase monthly dues, there are very specific requirements for WHEN and HOW they must notify you.

Every year, your HOA Board creates a Budget so they can determine how much each Owner needs to pay each month.

(The requirements below are specific to California)

WHEN

The new budget, along with your monthly payment amount, must be sent to you between 90 to 30 days before your new HOA payment is due.

HOW

The default requirement for sending the Budget is first-class mail. If your Board wants to send you the Budget via email, they must get your written consent.

So what happens if either the WHEN or HOW requirements aren’t met?

Let’s use a real world example…

At 428 Alice in Oakland, CA, the new Budget takes effect January 1, 2023. This means the 428 Alice Board needed to send it out to Owners by December 1, 2022.

Three weeks after the mailing deadline had passed, a concerned Owner at 428 Alice contacted us since they still hadn’t received their 2023 Budget. As such, they didn’t know what their new HOA payment would be. Given their monthly payment had increased an average of 10% per year for the last 5 years, they were particularly concerned about underpaying since the HOA charges penalties for not paying the correct amount.

We advised the Owner to contact their HOA Manager, The Helsing Group, to confirm if and when Budgets were mailed out. The Helsing Group informed the Owner that the Budget was NOT mailed to them, it had been emailed. The Owner informed The Helsing Group that they never gave consent for email delivery and asked for proof of their consent. The Helsing Group responded: “You must have done it on our website”. They could not provide record or proof of consent.

It’s clear The Helsing Group caused the 428 Alice Board to violate the HOW requirement for the new Budget… so what next?

Here is what will likely happen:

1. The Owner pays the new HOA dues amount “under protest”

2. The Owner files a small claims case against the HOA to have the new budget invalidated

3. If the judge decides in favor of the Owner, the monthly HOA payment will return to the 2022 amount

4. If the 428 Alice Board, wants to reinstate the 2023 HOA payment, it will have to go to a vote of the Owners.

For more information:

• CA Civil Code 4040 Providing Notice or Delivery to Individuals

• CA Civil Code 4041 Member Contact Information

• CA Civil Code 5300 Annual Budget Report

• CA Civil Code 5658 Payment Under Protest