California HOA Assessment Limits

Section 1: Overview

California limits how much an HOA board can raise assessments without going to the members. The Davis-Stirling Common Interest Development Act — a single unified statute codified at California Civil Code sections 4000 through 6150 — covers all common interest development types, including condominium projects, planned developments, stock cooperatives, and community apartment projects.¹ Civil Code section 5605 establishes two hard caps: the board cannot raise the regular assessment by more than 20 percent over the prior fiscal year's regular assessment, and it cannot levy special assessments totaling more than 5 percent of budgeted gross expenses — not without the approval of a majority of a quorum of members.² A separate emergency exception in section 5610 lets the board exceed both caps without a member vote, but only within three specifically defined situations.³ California sits at the statutory-cap end of the national assessment-limit spectrum, alongside Arizona, in contrast to ratification-mechanism states that follow the Uniform Common Interest Ownership Act and to states where the recorded declaration sets the primary limits. The sections below detail the authority to levy, the caps, the emergency exception, the procedures, and recent legislative and judicial activity.

Section 2: The assessment framework

2A. Authority to levy and allocate assessments

The board carries a mandatory duty to fund the association. Civil Code section 5600 requires the association to levy regular and special assessments sufficient to cover its obligations under the governing documents and the Act, and it bars the association from collecting any assessment or fee that exceeds the amount necessary to defray the costs for which it was levied.⁴ That duty applies uniformly across all community types, because Civil Code section 4100 defines "common interest development" to include community apartment projects, condominium projects, planned developments, and stock cooperatives, and the Act standardizes governing rules across all of them.¹ The recorded declaration — not the statute — fixes the allocation formula among separate interests, whether equal per unit, by ownership percentage, or by square footage. The board exercises its practical power to set the assessment through the annual budget process under Civil Code section 5300, which requires the board to distribute an annual budget report 30 to 90 days before the end of the fiscal year. That report must include a pro forma operating budget on an accrual basis, a reserve summary, and a reserve funding plan summary.⁵ The budget is the instrument through which the board fixes the regular assessment for the coming year, subject to the statutory caps described below.

2B. The statutory caps on increases

Civil Code section 5605(b) states the operative caps: the board may not impose a regular assessment more than 20 percent greater than the preceding fiscal year's regular assessment, and may not impose special assessments that in the aggregate exceed 5 percent of the budgeted gross expenses for that fiscal year — without the approval of a majority of a quorum of members under section 4070, at a member meeting or election.² The two caps use different measurement bases: the regular-assessment cap measures against the prior year's regular assessment, while the special-assessment cap measures against the current fiscal year's budgeted gross expenses. Section 5605, subdivision (c) defines "quorum" for these purposes as more than 50 percent of the members — a figure that applies regardless of any contrary quorum provision in the governing documents.² Subdivision (a) adds a separate requirement for any no-vote annual increase: the board cannot impose a regular-assessment increase unless it has complied with the budget-reporting requirements in section 5300(b) or has obtained member approval.² In practice, a board that wants to raise the regular assessment without a vote must both stay at or below the 20 percent cap and complete the section 5300 budget distribution. The caps interact with the governing documents in one direction: section 5605(b) applies "notwithstanding more restrictive limitations" in the governing documents to authorize a board to reach the statutory ceilings, but the statute does not let a board override a stricter declaration cap without following the declaration's own approval mechanism. A board that exceeds a cap without the required member approval acts outside its authority, and the increase is not validly imposed. Effective January 1, 2025, section 5605 added subdivision (c), barring associations that record an original declaration on or after January 1, 2025 from raising the regular assessment on a deed-restricted affordable housing unit by more than 5 percent plus the percentage change in the cost of living — capped at 10 percent — subject to several statutory exceptions.⁶

2C. Emergency assessments, notice, and timing

Civil Code section 5610 carves out an emergency exception to the section 5605 caps. The statute defines an "emergency situation" to cover three categories: an extraordinary expense required by a court order; an extraordinary expense the association must incur to operate, repair, or maintain the development or any part of it where a threat to personal health or safety or another hazardous condition is discovered; or an extraordinary expense for repair or maintenance that the board could not have reasonably foreseen when preparing the annual budget report under section 5300.³ Before the board imposes an assessment under the third category, it must adopt a resolution with written findings explaining the necessity of the expense and why it was not reasonably foreseeable, and distribute that resolution to the members together with the assessment notice.³ For routine increases, Civil Code section 5615 requires the association to deliver individual notice — pursuant to section 4040 — of any increase in regular or special assessments not less than 30 nor more than 60 days before the increase becomes due.⁷ The operational result is clear: the board may exceed the caps without a member vote only in a defined emergency, and every routine increase demands advance individual notice within that 30-to-60-day window.

Section 3: Assessment limits and procedures in practice

A. Regular assessment increase procedure

To raise the regular assessment without a member vote, the board must complete the annual budget report distribution required by Civil Code section 5300 — distributed 30 to 90 days before fiscal year end — and hold the increase at or below 20 percent over the prior year's regular assessment.⁵ An increase above 20 percent requires the approval of a majority of a quorum of members under section 5605(b), and the board must give individual notice of the increase 30 to 60 days before it becomes due under section 5615.² Where the governing documents set a lower cap, that lower limit controls.

B. Special assessment procedure

A board may levy special assessments totaling up to 5 percent of budgeted gross expenses for the fiscal year without a member vote; assessments that in the aggregate exceed 5 percent require the approval of a majority of a quorum under section 5605(b).² The board must give individual notice 30 to 60 days before the assessment becomes due under section 5615, and the declaration may impose stricter limits.⁷

C. Caps, ceilings, and override mechanisms

The 20 percent regular-increase cap and the 5 percent special-assessment cap mark the outer limits of board authority, with the override requiring approval of a majority of a quorum — defined by statute as more than 50 percent of members.² The only path to exceeding the caps without that member approval runs through the section 5610 emergency exception, which the statute confines to its three categories.³ Where the governing documents set a stricter ceiling, that lower limit governs the board's no-vote authority.

D. Notice, documentation, and disclosure tied to assessments

The board must deliver individual notice of any increase in regular or special assessments — pursuant to section 4040 — not less than 30 nor more than 60 days before the increase is due, as Civil Code section 5615 requires.⁷ On resale, Civil Code section 4525 requires the selling owner to provide a prospective purchaser with a true written statement showing the association's current regular and special assessments and fees, any unpaid assessments, and any approved changes not yet due — along with the most recent documents distributed under section 5300.⁸ Governing documents may require disclosures beyond the statutory minimum.

Section 4: Recent legislative and judicial activity

4A. Recent bills

4B. Recent appellate rulings

4C. Active legislative debates

No bill amending the section 5605 caps, the majority-of-a-quorum approval standard, the section 5610 emergency exception, or the section 5615 notice rule stands as a verified active measure as of June 9, 2026. Recent Davis-Stirling activity — such as AB 130 (2025), which addressed enforcement and fining provisions in sections 5850 and 5855 — did not touch the assessment provisions.

Section 5: National positioning and related coverage

California occupies the statutory-cap end of the national assessment-limit spectrum. In the first group, statutory-cap states — California and Arizona — fix numerical limits on board authority by statute: California caps regular increases at 20 percent and special assessments at 5 percent of budgeted gross expenses under Civil Code section 5605, while Arizona Revised Statutes section 33-1803(A) bars a regular assessment increase of more than 20 percent over the immediately preceding fiscal year's assessment without majority member approval.¹¹ In the second group, ratification-mechanism states that have adopted the Uniform Common Interest Ownership Act — including Colorado, Connecticut, Alaska, and Washington — use an owner veto on a board-adopted budget rather than a percentage cap. Under Colorado Revised Statutes section 38-33.3-303(4)(a), the board sends a budget summary within 90 days of adoption, and the budget stands approved unless a majority of all owners vote to reject it at a noticed meeting.¹² In the third group, CC&R-primary states — including Alabama, Arkansas, and Mississippi — leave assessment limits to the recorded declaration. California's caps rank among the most-cited assessment rules in the country. For multi-state operators, that means a California portfolio requires administration against a hard statutory ceiling and a member-vote mechanic that does not transfer to UCIOA ratification states or declaration-governed states.

1. Cal. Civ. Code § 4100 (definition of common interest development); Davis-Stirling Common Interest Development Act, Cal. Civ. Code §§ 4000–6150 ↩
2. Cal. Civ. Code § 5605 ↩
3. Cal. Civ. Code § 5610 ↩
4. Cal. Civ. Code § 5600 ↩
5. Cal. Civ. Code § 5300 ↩
6. Cal. Civ. Code § 5605(c); AB 572 (Stats. 2023, Ch. 745) ↩
7. Cal. Civ. Code § 5615 ↩
8. Cal. Civ. Code § 4525 ↩
9. SB 900 (Stats. 2024, Ch. 288) ↩
10. Ruffier v. Volcano Hills Road Maintenance Assn., No. C101551 (Cal. Ct. App. 3d Dist. Dec. 15, 2025, ordered published Jan. 6, 2026) ↩
11. Ariz. Rev. Stat. § 33-1803 ↩
12. Colo. Rev. Stat. § 38-33.3-303 (Colorado Common Interest Ownership Act budget ratification) ↩