Special Assessment 5% Limitation

SPECIAL ASSESSMENT
5% LIMITATION

Boards are allowed to special assess the membership up to 5% of the current year's budgeted gross expenses without membership approval regardless of any limitations that might be found in the governing documents. Civil Code §1366(b)

How Determined. If an association's annual budget is $100,000, then the maximum special assessment the board can impose without membership approval is $5,000. That does not mean $5,000 per unit. The $5,000 assessment is divided among all units according to the allocation schedule contained in the CC&Rs.

Membership Approval. For special assessments over 5%, boards must seek membership approval by secret ballot using Election Rules adopted by the association. For purposes of a special assessment, the statute defines "quorum" to mean more than 50 percent of the owners of an association. The governing documents of an association cannot increase or decrease the approval requirements for membership approval. Any such changes are voided by Civil Code §1366(b)

Updated by ADAMS KESSLER 6/12/2008