Glossary of Terms: C

a source of funds that the HOA can use to repair and replace major capital facilities, buildings, and equipment of the association.

Also known as "reserve funds" or simply "reserves"

Unless the governing documents require more stringent standards, the board must review on a monthly basis:

1. A current reconciliation of the association's operating accounts
2. A current reconciliation of the association's reserve accounts
3. The current year's actual operating revenues and expenses compared to the current year's budget.
4. The latest account statements prepared by the financial institutions where the association has its operating and reserve accounts
5. An income and expense statement for the association's operating and reserve accounts.
6. The check register, monthly general ledger, and delinquent assessment receivable reports.

(Amended by Stats. 2018, Ch. 396, Sec. 3. (AB 2912) Effective January 1, 2019.)

CA Civ. Code § 5500

Use of Reserve Funds

1. The signatures of at least two persons, who shall be directors, or one officer who is not a director and one who is a director, shall be required for the withdrawal of moneys from the association's reserve accounts
2. The board shall not expend funds designated as reserve funds for any purpose other than the repair, restoration, replacement, or maintenance of, or litigation involving the repair, restoration, replacement, or maintenance of, major components that the association is obligated to repair, restore, replace, or maintain and for which the reserve fund was established.

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 5510

Reserve Planning

1. The reserve funding plan required by Section 5550 shall include a schedule of the date and amount of any change in regular or special assessments that would be needed to sufficiently fund the reserve funding plan
2. The plan shall be adopted by the board at an open meeting before the membership of the association as described in Article 2 (commencing with Section 4900) of Chapter 6
3. If the board determines that an assessment increase is necessary to fund the reserve funding plan, any increase shall be approved in a separate action of the board that is consistent with the procedure described in Section 5605

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 5560

an accounting method that recognizes income and expenses at the time cash is received or paid out

The other accounting methods include:

• Accrual
• Modified Accrual (or Modified Cash or Hybrid)

https://www.investopedia.com/terms/a/accrualaccounting.asp

https://www.investopedia.com/terms/c/cashbasis.asp

https://www.investopedia.com/terms/m/modified-accrual-accounting.asp

CA Civ. Code § 5200

the entire common interest development except the separate interests

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 4095

1. A community apartment project
2. A condominium project
3. A planned development
4. A stock cooperative

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 4100

a development in which an undivided interest in land is coupled with the right of exclusive occupancy of any apartment located upon it

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 4105

1. a non-profit entity, other than an association, that is organized to provide services to residents of the common interest development or to the public in addition to the residents, to the extent community common area or facilities are available to the public
2. "Community service organization or similar entity" does not include an entity that has been organized solely to raise moneys and contribute to other non-profit organizations that are qualified as tax exempt under Section 501(c)(3) of the Internal Revenue Code and that provide housing or housing assistance.

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 4110

a plan described in CA Civ. Code Section 4285

A condominium plan shall contain all of the following:

1. A description or survey map of a condominium project, which shall refer to or show monumentation on the ground.
2. A three-dimensional description of a condominium project, one or more dimensions of which may extend for an indefinite distance upwards or downwards, in sufficient detail to identify the common area and each separate interest.
3. A certificate consenting to the recordation of the condominium plan pursuant to this act that is signed and acknowledged as provided in Section 4290.

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 4120

1. a real property development consisting of condominiums
2. A condominium consists of an undivided interest in common in a portion of real property coupled with a separate interest in space called a unit, the boundaries of which are described on a recorded final map, parcel map, or condominium plan in sufficient detail to locate all boundaries thereof. The area within these boundaries may be filled with air, earth, water, or fixtures, or any combination thereof, and need not be physically attached to land except by easements for access and, if necessary, support. The description of the unit may refer to (1) boundaries described in the recorded final map, parcel map, or condominium plan, (2) physical boundaries, either in existence, or to be constructed, such as walls, floors, and ceilings of a structure or any portion thereof, (3) an entire structure containing one or more units, or (4) any combination thereof.
3. The portion or portions of the real property held in undivided interest may be all of the real property, except for the separate interests, or may include a particular three-dimensional portion thereof, the boundaries of which are described on a recorded final map, parcel map, or condominium plan. The area within these boundaries may be filled with air, earth, water, or fixtures, or any combination thereof, and need not be physically attached to land except by easements for access and, if necessary, support.
4. An individual condominium within a condominium project may include, in addition, a separate interest in other portions of the real property.

(Added by Stats. 2012, Ch. 180, Sec. 2. (AB 805) Effective January 1, 2013. Operative January 1, 2014, by Sec. 3 of Ch. 180.)

CA Civ. Code § 4125

a recorded documentation that contains a legal description of the development and a statement that is a community apartment project, condominium project, planned development, or stock cooperative

The declaration must additionally include the name of the association and the restrictions on the use or enjoyment of property.

CC&Rs describe property rights and obligations of the membership, such as

1. restrictions on the use of property
2. member and association maintenance duties
3. enforcement powers
4. lender protection provisions
5. assessments obligations and lien/collection rights
6. duty to insure
7. dispute resolution and attorneys' fees provisions

CA Civ. Code § 4250