While the confusion regarding the new laws restricting a homeowners association’s ability to fine members has received most of the attention, one additional line was added to the emergency budget bill that also impacts how homeowners associations operate.

Civil Code section 714.3 has been amended over the years and allows a homeowners association to regulate, but not ban, accessory dwelling units (ADUs) and Jr.ADUs.  The change to the law creates a new definition of what might be considered a “reasonable restriction” by adding “Reasonable restrictions shall not include any fees or other financial requirements” to Civil Code section 714.3.

This new definition of what is and is not “reasonable” essentially eliminates an association’s ability to charge a fee or deposit for the architectural review of an ADU or Jr.ADU application. It should be noted that ADU architectural applications rarely include adding a new ADU structure without modifying any other improvements on the lot such as landscaping, walls, fences, hardscape, etc. Associations may still be permitted to charge fees and deposits for the review of the improvements that do not fall within the ADU or Jr.ADU definition.

 Including this new language clearly indicates an intent to remove barriers that might make ADUs unaffordable, thus creating roadblocks to the legislature’s intent. But it also increases the burden on the membership by essentially requiring any architect’s or management company fees related to administering or reviewing architectural applications to be subsidized by the entire membership rather than borne by the owner who seeks to profit from the rental of the ADU.