AB 1101 (2021)

§ 5380

This act was the only one to amend this section in that window.

1. (a)amended… which is insured by the federal government, or is a guaranty corporation subject to Section 14858 of the Financial Code, and shall be maintained there until disbursed …
2. (b)amended… the association shall be deposited into an interest-bearing account in a bank, savings association, or credit union in this state, state that is insured by the Federal Deposit Insurance Corporation, National Credit Union Administration Insurance Fund, or a guaranty corporation subject to Section 14858 of the Financial Code, provided all of the following requirements are met:
3. (b)(2)amended… provided by an agency of the federal government. government or a guaranty corporation subject to Section 14858 of the Financial Code. Those funds may only be deposited in accounts that protect the principal. In no event may those funds be invested in stocks or high-risk investment options.
4. (b)(3)amended… whom the managing agent holds funds in trust except that the funds of various associations may be commingled as permitted pursuant to subdivision (d). trust.
5. (b)(6)amendedTransfers of greater than ten thousand dollars ($10,000) funds out of the association’s reserve or 5 percent of an association’s total combined reserve and operating account deposits, whichever is lower, accounts shall not be authorized from the account without prior written approval from the board of the association. association unless the amount of the transfer is less than the following:
6. (b)(6)(A)addedThe lesser of five thousand dollars ($5,000) or 5 percent of the estimated income in the annual operating budget, for associations with 50 or less separate interests.
7. (b)(6)(B)addedThe lesser of ten thousand dollars ($10,000) or 5 percent of estimated income in the annual operating budget, for associations with 51 or more separate interests.
8. (d)amended… others that the managing agent receives or accepts, unless all of the following requirements are met: accepts.
9. (d)(1)removedThe managing agent commingled the funds of various associations on or before February 26, 1990, and has obtained a written agreement with the board of each association that the managing agent will maintain a fidelity and surety bond in an amount that provides adequate protection to the associations as agreed upon by the managing agent and the board of each association.
10. (d)(2)removedThe managing agent discloses in the written agreement whether the managing agent is deriving benefits from the commingled account or the bank, credit union, or savings institution where the moneys will be on deposit.
11. (d)(3)removedThe written agreement provided pursuant to this subdivision includes, but is not limited to, the name and address of the bonding companies, the amount of the bonds, and the expiration dates of the bonds.
12. (d)(4)removedIf there are any changes in the bond coverage or the companies providing the coverage, the managing agent discloses that fact to the board of each affected association as soon as practical, but in no event more than 10 days after the change.
13. (d)(5)removedThe bonds assure the protection of the association and provide the association at least 10 days’ notice prior to cancellation.
14. (d)(6)removedCompleted payments on the behalf of the association are deposited within 24 hours or the next business day and do not remain commingled for more than 10 calendar days.