SB 326 Inspection for California (HOAs & Condos)

With extensive experience delivering more than 4,000 inspections statewide, we bring a deep understanding of the regulatory landscape and its demands. Our goal is to streamline the compliance process—whether you're overseeing a property, serving on an HOA board, or managing a small portfolio—so you can move forward with assurance and ease.

SB-326 Background

January 1, 2020, the State legislature added California Civil Code § 5551 to require
condominium associations with certain elevated exterior elements (“EEEs”) such as
decks, balconies, walkways, stairs, and related railings to be inspected by January 1,
2025. This new law is often referred to as the “Balcony Bill” or SB326 as that was the
bill number before being passed into law in year 2019. The cause for this legislation was due to the collapse of a balcony that caused several deaths and so the purpose of these inspections is to make sure EEEs are safe to use and if unsafe, limit access until such
EEEs are repaired.

What is subject to inspection?

Condominium associations (this law does not apply to Planned Developments) are
required to inspect certain load-bearing components and the waterproofing systems of
EEEs.

For load-bearing components, these are EEEs components (i) extended beyond the
exterior walls of the building to deliver structural loads; (ii) elevated more than 6 feet
above ground level; (iii) designed for human occupancy or use, and (iv) supported in
whole or in substantial part by wood or wood-based products.
Exclusions: Multifamily dwelling buildings with two or less units; commercial
condominiums; and industrial condominiums.

Who inspects the EEEs and What to Expect?

A licensed architect or structural engineer* must perform the work. (Note*: AB 2114 is a
current bill that may be passed in the next few months that would allow licensed civil
engineers to perform the inspections). LICENSED GENERAL CONTRACTORS are not
authorized by this new law to perform the EEEs inspections to comply with Civil Code §
5551. Licensed contractors would be expected to perform any necessary repairs.
The inspector will perform visual observations of a statistically significant sample of
EEEs to determine whether the EEEs are in a generally safe condition in accordance
with applicable standards. The visual inspection is the least intrusive method necessary
to inspect load-bearing components, including visual observation or visual observation
with the use of moisture meters, borescopes, or infrared technology. The inspector may
determine further investigation is needed based on their professional judgment.
Interestingly, only some but not all of the EEEs in your development may need to be
inspected. In regards to balconies, our office has seen some balconies (for example,
balconies that are not cantilevered) within the development but not others meeting the
statutory criteria. And even if your association has no balconies, it might have other
EEEs subject to inspection, such as stairs and walkways. If your association is unsure
whether Civil Code § 5551 applies, ask the architect/engineer for clarification and
consult with your association’s legal counsel as needed. If your association is already
on a tight or underfunded budget, you don’t want your association to pay for
unnecessary inspections and incur additional repair costs at this time. Consulting with
legal counsel about whether your association is subject to Civil Code § 5551 may
provide immediate savings in time and expense, and allow for better future budgeting.

Timeline

If your association hasn’t explored whether it is required to have its EEEs inspected,
you are behind. Popular and competitively-priced licensed structural engineers and
architects that perform inspections of EEEs may be booked up through the end of the
year which is one of the reasons why a new bill is being considered by the State to
allow civil engineers to perform the inspections.

1st inspection completion date: Complete by January 1, 2025 and then every nine (9) years thereafter. Exception: Newer developments and construction completed after January 1, 2020 have six (6) years since the issued certificate of occupancy to complete the first inspection.
Budget accordingly, it is likely that a few hundred to a few thousand dollars for the
EEEs inspection is required, depending on the circumstances such as the number of
EEEs, conditions of the EEEs, market rate for inspections, etc. If you know your
development has EEEs in a poor state, then your association should also start
budgeting for possible required repairs after the inspection as repairs may cost
thousands of dollars per EEE.

What happens after inspection?

Your association will receive a report that is required to be incorporated into the
reserve study.
Depending on the condition of your EEEs, the architect/engineer may require more
intrusive observations, including destructive testing, if there is an indication of safety-
compromised damage, e.g., opening part of an EEEs surface to reveal extensive dry rot
wood damage.
If the architect/engineer advises that any of the association’s EEEs pose an immediate
threat to the safety of the building’s occupants, the expert is required to provide a copy
of the inspection report to the association, as well as a copy to the local code
enforcement agency, and this is to be done within fifteen (15) days of completion of the
report. The architect/engineer may report dangerous conditions even sooner as
required by other law. The very real result is that certain balconies or stairs may be
“yellow-tagged” or “red-tagged” by your City with a notice of a violation and notice to
comply after receiving the inspection results resulting in the EEEs being barred from
use until it is repaired. When EEEs are red-tagged, your association is required by Civil
Code § 5551 to take immediate action to limit access to the affected area. Your
association may then be dealing with angry residents who cannot use their balcony,
deck, or stairway until the required repairs are made.
-If your association is underfunded and needs more funds for inspections and repairs,
boards need to remember that any levy of a special assessment takes time.

Liability

If your association doesn’t perform the required inspections timely, your association is exposed to liability. Possible claims and issues include:

Breach of fiduciary duties by the Board of Directors
-Breach of the CC&Rs and lawsuit to force the association to complete the inspection
Successful claims of negligence for personal injury and/or property damage claims if
the inspection was required and not timely performed resulting in someone’s injury
Some members of our industry express concern about the possible lack of insurance
coverage for untimely inspections and resulting injuries.
Of course, the real concern is if there are any safety concerns that need to be
addressed irrespective of the liability issues.

Your Board may have already determined your association is not subject to EEEs
inspections but how did it reach that decision? Boards and associations are afforded
protection from liability for their decisions, including the decision to not perform certain actions, when supported by the consultation of experts such as your managers, legal
counsel, engineers, and architects.

Next Steps

Contact your manager immediately and a licensed structural engineer or architect to
discuss whether your association needs EEEs inspections. Your association may also
want to consider seeking legal counsel as needed for further advice on the applicability
of EEEs inspections, funding options, and the review of any large contracts for the
inspections or resulting required repairs. These experts are here to guide your
association to create a safer community.