California HOA fines are capped at $100 — and owners get to cure first
California HOA fines are capped at $100 — and owners get to cure first
2026-09-09 · California · Compliance
The most consequential change to California homeowners association enforcement in a decade arrived inside a housing budget bill, took effect the day it was signed, and is still being applied incorrectly.
AB 130 was chaptered as Chapter 22, Statutes of 2025 on June 30, 2025. Because it was an urgency budget measure, it took effect immediately — not on the following January 1, which is where boards working from a “new laws for 2026” summary will have looked for it.1
It rewrote Civil Code sections 5850 and 5855, the provisions that govern monetary penalties and disciplinary hearings.
The cap
New section 5850(c): a monetary penalty “shall not exceed the lesser of” the amount in the association's published penalty schedule in effect at the time of the violation, or $100 per violation.2
“The lesser of” matters. An association whose schedule sets a $50 fine for a violation cannot charge $100; the schedule still binds it downward.
The exception has a procedure attached
Section 5850(d) permits a penalty above $100 only where the violation “may result in an adverse health or safety impact on the common area or another association member's property.”
And the board “shall make a written finding specifying the adverse health or safety impact in a board meeting open to the members” — before imposing it. The finding is not something a board can supply afterwards if the fine is challenged, and it cannot be made in executive session.
No late fees, no interest
Section 5850(e) is one sentence: “A late charge or interest shall not be charged to a member for a monetary penalty.”
Section 5850(f) requires the association to give any member, on request, a copy of the most recently distributed penalty schedule plus supplements.
The cure right
New section 5855(c) is the provision boards most often miss: “A member shall have the opportunity to cure the violation prior to the meeting.”
The board shall not impose discipline if the member cures before the meeting — or, where a cure would take longer than the gap between the 10-day notice and the meeting, if the member “provides financial commitment to cure.”3
What it changes for boards and managers
Section 5855(g) is what gives all of this teeth. It was not amended, but AB 130 made it load-bearing: discipline “shall not be effective against a member unless the board fulfills the requirements of this section.” A fine imposed without offering the cure opportunity is not merely challengeable — it is ineffective. That is a different legal position from a procedural defect the association can cure by redoing the hearing.
Violation letters need a cure path and a commitment path. A notice that recites the alleged violation and the hearing date, without telling the owner they may cure before the meeting or submit a financial commitment where the cure takes longer, is not doing what the statute now contemplates. Associations that have not revised their letter templates since June 2025 are issuing notices built for the prior regime.
The financial-commitment route is the one nobody has a form for. Consider an owner cited for a failed roof or deteriorated paint — work that cannot be completed in the ten days between notice and hearing. The statute lets that owner avoid discipline by committing financially to the cure. What that commitment looks like, how it is evidenced, and what happens if it is not honoured are all questions the statute leaves to the association's procedure. Boards without a procedure will improvise at the hearing, which is where inconsistency becomes an argument.
Anything above $100 requires the meeting before the fine. This inverts the usual sequence. The open-session written finding on the health or safety impact comes first; the penalty follows. A board that fines at $250 and documents its reasoning in the decision letter has done it backwards.
Fine receivables need separating from assessment receivables. Because no late charge or interest may attach to a monetary penalty, an accounting system that ages fines alongside assessments and applies the same late fee is generating charges the statute prohibits. This is a management-software configuration problem as much as a policy one.
The settlement provision worth using
New section 5855(e) has had almost no attention and is genuinely useful. Where the board and the member reach agreement after the hearing, the board shall draft a written resolution; once signed, it “binds the association and is judicially enforceable.”
That converts an informal understanding at a hearing into an enforceable instrument, and it runs both ways — the association is bound too. For a long-running dispute, it is a cleaner exit than either alternative dispute resolution or repeated fines.
One deadline moved by a day, and it will catch people
Section 5855(f) cut the post-decision written notice deadline from 15 days to 14 days.
A one-day change is exactly the kind that survives in a template unnoticed. An association calendaring 15 days is now late by one, on a requirement that section 5855(g) ties to the effectiveness of the discipline.
What did not change, and what is not coming
The cap applies to monetary penalties for governing document violations. It does not limit an association's other remedies — suspension of privileges, alternative dispute resolution, injunctive relief — and it does not reach assessments, late charges on assessments, or the collection costs recoverable under the lien statutes.
Boards hoping the cap would be loosened should stop waiting. AB 2579 would have replaced the blanket $100 limit with an enumerated list of higher-penalty violations and directed the Department of Real Estate to publish that list by January 1, 2028. Its author moved it to the inactive file on May 21, 2026 and never revived it. The 2025–2026 session has adjourned, so it cannot return; a successor would be a new bill in the session convening December 2026.
The cure loophole AB 2579 would also have closed — the habitual violator who stops the day before the hearing — remains open. Associations dealing with that pattern have the tools they had: documented history, separate notices for separate occurrences, and the remedies the fine cap does not reach.
Related California HOA Topics
- AB 130, California Legislature — chaptered text and Legislative Counsel's Digest (Chapter 22, Statutes of 2025, effective June 30, 2025) ↩
- Civil Code § 5850, California Legislative Information — operative text of the $100 cap, the health and safety exception and the bar on late charges and interest ↩
- Civil Code § 5855, California Legislative Information — operative text of the cure opportunity, the binding written resolution and the 14-day notice ↩
- AB 2579, California Legislature — bill status showing the measure ordered to the inactive file on May 21, 2026 ↩
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