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Important changes for HOAs – HOA fines are now capped and other new requirements 

7/14/25

By: Mandy D. Hexom and Matthew S. Jones

AB 130 was signed into law, effective June 30, 2025. This bill, which went into immediate effect, aims to speed up housing development by easing CEQA requirements and it also significantly alters HOA enforcement rules by limiting fines under the Davis-Stirling Act, specifically Civil Code Sections 5850 and 5855.

The key changes include:

$100 Fine Cap: Associations can now fine members no more than $100 per violation. (Civil Code Section 5850(c)(2));

Health/Safety Exception: Higher fines are allowed only if the violation poses a health or safety risk. Boards must make a written finding in an open meeting to justify this. (Civil Code Sections 5850(d)(1)–(2));

Right to Cure: Violators must be given a chance to fix the issue before a hearing. If more time is needed, they may offer a financial commitment to the cure. (Civil Code Section 5855(c));

Dispute Resolution: After a hearing, if there’s no agreement, the member may request Internal Dispute Resolution (IDR). If there is an agreement, a written, legally binding resolution must be signed by both parties. (Civil Code Sections 5855(d)–(e)); and

Notice Deadline: Boards must now provide hearing results within 14 days, down from the previous 15-day requirement. (Civil Code Section 5855(f)).

Impact on HOAs: The $100 fine limitation may weaken enforcement, especially for serious violations like unapproved construction or short-term rentals. Luckily, any fines imposed prior to June 30, 2025, are not impacted. However, many existing fine schedules will now be invalid, potentially reducing compliance with HOA rules.

What Should HOAs Do: Consult your counsel for further recommendations and advice. HOAs must comply with these new requirements and should review their rules and regulations, enforcement and/or fine policies to be consistent with these new requirements.

For more information, please contact Mandy D. Hexom at mandy.hexom@fmglaw.com, Matthew S. Jones at matthew.jones@fmglaw.com or your local FMG attorney.

Information conveyed herein should not be construed as legal advice or represent any specific or binding policy or procedure of any organization. Information provided is for educational purposes only. These materials are written in a general format and not intended to be advice applicable to any specific circumstance. Legal opinions may vary when based on subtle factual distinctions. All rights reserved. No part of this presentation may be reproduced, published or posted without the written permission of Freeman Mathis & Gary, LLP.