Monday July 06, 2026
What are special assessments?
Special assessments are additional charges an HOA levies outside regular assessments to pay for specific expenses, projects, repairs, or unexpected costs. In California, special assessments are governed by the Davis-Stirling Common Interest Development Act. California HOA special assessment rules limit when boards can approve special assessments on their own and when member approval is required.Special assessments vs. regular assessments
Regular assessments are recurring charges used to fund the association’s annual budget. Special assessments are separate charges used for specific needs that are not fully covered by regular assessments, reserve funds, or other available funds.What special assessments may be used for
Special assessments may be used for legitimate association expenses, but they should be tied to the actual cost they are intended to cover. Common examples include major repairs, insurance shortfalls, emergency building work, legal obligations, infrastructure projects, or unexpected common area expenses.California HOA special assessment rules
There are several key California HOA special assessment rules boards should understand before levying a special assessment:- Special assessments cannot exceed the cost they are meant to cover: An association may not impose or collect an assessment or HOA fee that exceeds the amount necessary to pay for the cost it was levied to cover (Cal. Civ. Code § 5600(b)).
- The board may be able to approve special assessments up to the 5% threshold without member approval: California HOA law generally limits board-approved special assessments to amounts that, in the aggregate, do not exceed 5% of the association’s budgeted gross expenses for that fiscal year without member approval (Cal. Civ. Code § 5605(b)).
However, boards should also review their governing documents and consult counsel, because an association’s documents or circumstances may require a different process. For example, if an association’s budgeted gross expenses are $500,000, the 5% statutory threshold would be $25,000 in total special assessments for that fiscal year, but the board should confirm approval requirements before proceeding.
- Member approval is required above the 5% threshold: If special assessments exceed the 5% limit, approval is generally required by a majority of a quorum of members at a member meeting or election, with quorum meaning more than 50% of the members (Cal. Civ. Code §§ 5605(b), 5605(d)(3)).
- Associations must give advance notice: Associations must provide individual notice of a special assessment at least 30 days and no more than 60 days before the assessment becomes due (Cal. Civ. Code § 5615).
- Emergency special assessments are treated differently: The 5% member approval limit generally does not apply when a special assessment is needed for a qualifying emergency, such as certain court-ordered expenses, health or safety threats, hazardous conditions, or extraordinary expenses the board could not have reasonably foreseen during the budget process. Boards should confirm the situation qualifies before relying on this exception (Cal. Civ. Code § 5610).
- Some emergency assessments require written findings: Before imposing or collecting certain emergency assessments for unforeseeable expenses, the board must pass a resolution with written findings explaining why the expense is necessary and why it was not, or could not have been, reasonably foreseen (Cal. Civ. Code § 5610(c)). The resolution must also be distributed to members with the notice of assessment.
Tips for boards
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Coordinate with professionals
Special assessments may involve legal, financial, construction, HOA insurance coverage, or reserve questions. Work with qualified counsel, your HOA manager, reserve professionals, engineers, and vendors before adopting the assessment.
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Start with the budget
Before approving a special assessment, review the current budget, reserves, contracts, bids, and project timeline. Boards should understand whether the expense can be covered another way before asking owners for more money.
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Document the reason
Owners are more likely to understand a special assessment when the board explains the project, cost, urgency, and funding gap. Keep contractor bids, reserve study pages, engineer reports, invoices, and meeting minutes organized.
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Use clear owner communication
Special assessments can create concern, even when they are necessary. Explain what the assessment pays for, why it is needed, when payment is due, and what happens if the project is delayed or costs change.
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Be cautious with emergencies
Emergency assessments should be used only when the facts support them. If the board relies on the emergency exception, work with the association attorney, document the condition, timing, legal basis, and written findings carefully before sending the assessment notice.
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Track funds separately
Boards should be able to show how special assessment money was collected and spent. Clear accounting helps the association answer owner questions, manage project costs, and avoid confusion if the project changes.
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Review collection procedures
Before collecting unpaid amounts, review the association’s collection policy, notice requirements, payment plan procedures, and legal obligations. A special assessment approved incorrectly may create collection problems later.
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Avoid over-collecting
A special assessment should be tied to the actual cost it is intended to cover. Boards should be careful not to build in unrelated expenses or broad “just in case” amounts unless they are legally and financially supportable. If costs change, work with counsel and management on the proper next step.
About FirstService Residential
FirstService Residential supports California communities with local expertise backed by national resources. For more than 40 years, our dedicated teams have helped boards stay organized with governance support, recordkeeping systems, financial management, vendor coordination, banking and insurance programs, resident communication, and 24/7 customer care.We help boards apply consistent processes that align with their governing documents and California law, so board members can stay focused on long-term community goals instead of day-to-day administration.
Contact a member of our team today to learn more.
This information is provided for general informational purposes only and is not intended to constitute, and should not be relied upon as, legal, regulatory, financial, or operational advice, or as a representation or guarantee of any specific services, capabilities, or outcomes. Property management needs, regulatory requirements, market conditions, and available services vary by jurisdiction, property type, and community. FirstService Residential provides services through locally based affiliates and associates, and services and results may vary by community, region, contractual terms, and applicable law.