Common interest developments: reserve accounts.

Fixed a grammatical error in new Section 5552(b): changed 'no longer to projected to fall below zero' to 'no longer projected to fall below zero.' No policy impact.

Standard enrollment formatting: removed line numbers, added Assembly and Senate passage dates (both August 26, 2026), added Governor's receipt and approval blocks, removed prior amendment history from the header, and removed 'as amended' from the digest heading.

New Section 1 adds legislative findings and declarations stating the intent to establish minimum reserve contribution levels ensuring projected balances do not fall below zero over 30 years, and reaffirming that reserve funds must be strictly safeguarded and used only for their intended purposes.

New Sections 3.1 and 3.2 create conditional versions of the reserve study requirements that incorporate SB 1238's exterior elevated elements (balconies, walkways, etc.) into the definition of major components and add a new study requirement for costs of components identified in Section 5551 reports.

New Section 5 establishes a coordination rule: Sections 3.1 and 3.2 only become operative if both AB 2050 and SB 1238 are enacted by January 1, 2027, this bill amends/repeals/adds Section 5550 while SB 1238 amends it, and this bill is enacted after SB 1238. If those conditions are met, Sections 2 and 3 of AB 2050 do not become operative.

The special assessment provision in Section 5552 was simplified. The old version required the assessment to be 'in an amount necessary to allow the association to fund to minimum contribution level without a reserve special assessment within nine fiscal years.' The new version simply requires the association to levy a reserve funding special assessment subject to the same provisions as a standard special assessment under Section 5605, removing the specific 9-year calculation formula.

Subdivision (d) of Section 5552 no longer specifies that the special assessment amount must equal 'the amount necessary to prevent the projected association reserve account balance from falling below zero over the following 30 years.' It now only states that funds collected shall be deposited in the reserve account and considered reserve funds.

New Section 5552(b) requires an association whose reserve account balance is projected to fall below zero at any time over the following 30 years to transfer a minimum of 15 percent of its gross annual budget to its reserve account each year until the projection no longer shows a deficit.

New paragraph (7) in Section 5550(b) requires the reserve study to include a statement informing the association that, beginning January 1, 2032, state law will require certain actions including the 15 percent budget transfer and, under specified conditions, levying a reserve funding special assessment.

The 'reserve special assessment' is renamed to 'reserve funding special assessment' throughout the bill, and the Senate version adds language requiring that it be subject to the same provisions as a standard special assessment under Section 5605.

New provision in Section 5552(c)(2) requires that if the reserve funding special assessment amount is insufficient to meet the minimum reserve contribution level due to the cap on special assessments without a vote, the association must have the membership vote on approving an amount exceeding the cap.

In Section 5552(b)(1), the period within which an association must fund to the minimum contribution level without a reserve special assessment was extended from 3 fiscal years to 9 fiscal years.

In Section 5552(b)(3), the limit on how often an association may levy a reserve funding special assessment was changed from once every 3 years to once every 9 years.

Assembly Members Dixon and Zbur were added as coauthors of the bill.