Pacific Association Collections - PAC
Assessment Limitations – 20%
Boards are required to levy assessments sufficient to perform their duties. This legal duty falls on board members, not the membership.
Notwithstanding, more restrictive limitations placed on the board by the governing documents, the board of directors may increase regular assessments by up to 20% of the association’s preceding fiscal year without membership approval. The 20% increase is based on the association’s regular assessments for the prior year.
While boards are allowed to raise dues by up to 20%, the authority is conditioned on timely distribution of a budget report. Failure to meet this requirement nullifies any increase levied by the board. If that happens, any increase for that fiscal year must be approved by the membership. (California Civil Code Section 5605 (b)). The governing documents of an association cannot increase or decrease the approval requirements for membership approval. Any such changes are voided by California Civil Code Section 5605 (b). The budget requirement described above does not apply to special assessments.
Pacific Association Collections