California AB 130 HOA Fine Limits: What Boards Must Know About the $200 Cap and Hearing Requirements

Before Assembly Bill 130, California HOAs had broad discretion to set fine amounts. Some associations imposed fines of $500, $1,000, or more per violation — often without a formal hearing process. Owners had limited recourse, and boards faced inconsistent guidance on what due process required.

AB 130 changed that by establishing:

1. A $200 cap on fines per violation
2. A formalized hearing requirement before any fine can be imposed
3. Clear integration with the Davis-Stirling IDR/ADR framework for dispute resolution

This guide covers what boards need to know, what must change, and how to implement a compliant enforcement process.

What AB 130 Changed

The Fine Cap

Effective January 1, 2022, Civil Code 5850 establishes:

• Maximum fine: $200 per violation
• For continuing violations (e.g., an ongoing noise issue or unapproved modification), the association may impose an additional $200 for each period the violation continues — but only after providing notice and an opportunity to cure
• The cap applies to all common interest developments governed by the Davis-Stirling Act

What This Means in Practice

Important: The $200 cap is per violation, per occurrence. It is not cumulative. A board cannot impose a $200 fine and then add $200 daily until the violation is cured. Each additional $200 fine requires a new notice, a new opportunity to cure, and (if the owner requests) a new hearing.

The Hearing Process

Notice Requirements

Before imposing any fine, the board must provide the owner with:

1. Written notice of the alleged violation — specific enough for the owner to understand and respond
2. At least 10 days' notice before the hearing date
3. Information about the hearing — date, time, location (or remote participation details), and the owner's right to attend and present evidence

At the Hearing

• The owner may attend (in person or remotely)
• The owner may present evidence — documents, photographs, witness statements, or verbal testimony
• The owner may respond to the allegations — challenge the facts, contest the interpretation, or provide mitigating circumstances
• The board must consider the owner's presentation before making a decision
• The decision must be documented — the finding, the fine (if any), and the basis for the decision

After the Hearing

• If a fine is imposed, the owner must be notified in writing
• The fine must not exceed $200 per violation
• The owner may pursue further dispute resolution through ADR (mediation) or small claims court

The IDR/ADR Framework

AB 130 does not exist in isolation. California's enforcement process is governed by the Davis-Stirling Act's broader dispute resolution framework.

Internal Dispute Resolution (IDR) — Civil Code 5900-5920

Before any formal enforcement action, the association must offer IDR:

• Written offer to meet with a board-designated representative
• The representative must have authority to settle the matter
• At least 10 days' notice to the owner
• Informal, good-faith discussion aimed at resolution

Key point: IDR is not optional. It must be offered before imposing a fine. Boards that skip IDR and proceed directly to enforcement expose the association to challenges that can invalidate the action.

Alternative Dispute Resolution (ADR) — Civil Code 5925-5965

If IDR does not resolve the matter:

• Either party may request mediation or arbitration
• ADR must be attempted before filing a civil action (with limited exceptions)
• Costs are shared unless otherwise agreed

The Full Enforcement Sequence

Violation Observed
    ↓
IDR Offered (10-day notice, meeting with authorized representative)
    ↓
If unresolved: Formal Hearing Notice (10 days minimum)
    ↓
Hearing Conducted (owner presents evidence, board deliberates)
    ↓
Decision Documented (fine ≤ $200, or no fine)
    ↓
If disputed: ADR (mediation) available
    ↓
If still unresolved: Small claims or civil action

Record-Keeping Requirements

Every step of the enforcement process must be documented and retained. At minimum, the association should maintain:

• Date the violation was observed, and by whom
• Copy of the violation notice sent to the owner
• IDR offer letter and any IDR meeting notes
• Hearing notice, with proof of delivery
• Hearing minutes (who attended, evidence presented, board discussion, decision)
• Written decision and fine notice
• Payment records for any fine imposed
• Any ADR correspondence or mediation outcomes

This documentation is the association's defense if the enforcement action is challenged. Without it, the board's position is difficult to defend.

How CommunityPay Helps

CommunityPay's owner ledger and governance tools provide the infrastructure for compliant enforcement:

• Owner ledger tracks all assessments, fines, payments, and credits with full transaction history
• Immutable audit trail documents every board action, including enforcement decisions
• Governance workflow with timestamped approvals ensures board decisions are recorded with proper authorization
• Fund accounting ensures fines are properly categorized and tracked separately from assessments

For associations managing enforcement manually — with spreadsheets, Word documents, and informal processes — the risk of procedural errors is significant. A system that enforces the correct sequence (IDR → hearing → documented decision) reduces that risk.

Explore CommunityPay's governance capabilities | Request a demo

AB 130 is one piece of California's broader HOA regulatory framework: - California HOA Disclosure Requirements 2026 — The full picture: SB 410, SB 326, SB 770, and Civil Code 4525 - California SB 326: Balcony Inspections and Special Assessment Risk — When inspection findings trigger special assessments, boards face enforcement questions alongside financial ones

This guide covers California HOA fine limits under AB 130 (Civil Code 5850) and the Davis-Stirling IDR/ADR framework. For legal advice specific to your community or enforcement situation, consult a California real estate attorney.