Davis-Stirling Special Assessments: Rules, the 5% Cap & Member Votes

A special assessment is how an HOA pays for something the budget and reserves can't cover — a new roof, a lawsuit, an insurance shortfall. Davis-Stirling caps how much your board can levy on its own before the members have to vote. Get the cap wrong and the assessment is unenforceable.

What is a special assessment?

A special assessment is a one-time charge an HOA levies on its members to fund a specific expense that the regular operating budget and reserve funds don't cover. Typical triggers:

• A major repair the reserve study didn't fully fund (roofs, roads, elevators)
• An insurance premium spike or a coverage shortfall after a claim
• Litigation costs
• An emergency — storm damage, a failed retaining wall, a code-compliance order

It's different from your regular assessment (the recurring dues that fund the annual budget). Special assessments are extraordinary, and because they hit members with an unexpected bill, Davis-Stirling limits how freely a board can impose them.

The Davis-Stirling 5% cap — the rule that controls everything

Here's the core rule self-managed boards have to internalize: in any fiscal year, the board cannot impose special assessments that in the aggregate exceed 5% of the association's budgeted gross expenses for that fiscal year — without approval from the members (Civil Code §5605(b)). That limit applies regardless of any lower or higher limit in your governing documents, and there's no cap on the number of special assessments, only the total: the board can levy one 5% assessment or five 1% assessments in a year, but the sixth that crosses 5% needs a vote.

The same section caps regular assessment increases: the board can't raise regular assessments more than 20% above the prior fiscal year without a member vote (§5605(b)).

So there are two ceilings the board can act under on its own:

• Special assessment(s) in a fiscal year — Board can do alone if...: Total ≤ 5% of budgeted gross expenses; Needs a member vote if...: Total > 5%
• Regular assessment increase — Board can do alone if...: Increase ≤ 20% over prior year; Needs a member vote if...: Increase > 20%

Free tool: Figure out where your assessment lands against the cap and split it fairly across units with Propty's special assessment calculator — it models lump-sum vs. installment and shows the per-unit charge.

When a member vote is required — and what "approval" means

If a special assessment would push you over the 5% line (or a regular increase over 20%), you need member approval. The approval standard is a majority of a quorum of the members, as defined in Civil Code §4070 — meaning, at a meeting or election where a quorum participates, more than 50% of those voting must approve.

That's a lower bar than "a majority of all members," but it still means you have to run a proper vote — and Davis-Stirling requires that vote to be by secret ballot (Civil Code §5100), the same as a director election or a governing-document amendment. You notice the membership, distribute and collect secret ballots, hit quorum, and have them tallied.

For a self-managed board, this is the part that gets skipped under time pressure — the roof is leaking, the board levies $400/unit, and nobody runs the secret-ballot vote. That assessment is then vulnerable to challenge by any member who didn't want to pay it.

The emergency exception

Davis-Stirling gives boards a release valve. The 5% cap does not apply to an emergency special assessment, which the board can levy without a member vote in three situations (Civil Code §5610):

1. An extraordinary expense required by a court order.
2. An extraordinary expense necessary to repair or maintain the common area (or other association property) where a threat to personal safety is discovered.
3. An extraordinary expense necessary to repair or maintain common area that could not have been reasonably foreseen by the board when it prepared the budget. For this category, the board must adopt a resolution setting forth the necessity for the expense, distributed to members with the notice of the assessment.

The third category is the one boards lean on, and it's also the one most likely to be second-guessed. The documented-resolution step is not optional — it's what makes the emergency assessment defensible.

Notice requirements for a special assessment

Even when the board can act alone, members are entitled to advance notice. A special assessment (or a regular-assessment increase) requires individual notice to members (delivered per Civil Code §4040) not less than 30 nor more than 60 days before it becomes due (Civil Code §5615).

The notice should state the amount, the reason, the due date, and any installment option. Skipping or short-circuiting the notice window is its own enforceability problem, separate from the cap.

How to calculate a special assessment per unit

Once you know the total and you've cleared the cap/vote question, you split it across units. Three common methods — and your governing documents control which one you use (Civil Code §5600):

• Equal per unit — total ÷ number of units. Simple and common where units are similar.
• By ownership percentage — each unit's recorded share of the common interest. Common in condos.
• By square footage — proportional to unit size.

Don't improvise the method — using a "fairer" split than your CC&Rs specify is itself a violation.

Free tools: Propty's special assessment calculator handles all three allocation methods and the installment math. If you're trying to avoid a special assessment in the first place, the reserve study calculator and budget generator help you fund reserves so the emergency never arrives.

The self-managed board's special-assessment checklist

1. Total the expense. What do you actually need to raise?
2. Check it against the 5% cap for the fiscal year (counting any special assessments already levied this year).
3. Decide: board-only or member vote? Over 5% → run a secret-ballot member vote, unless it's a documented emergency.
4. If emergency: confirm it fits one of the three §5610 categories and, for the unforeseen-repair category, adopt the required board resolution.
5. Send individual notice in the 30–60 day window (§5615).
6. Allocate per the CC&Rs — equal, percentage, or square footage.
7. Record it in the minutes and the owner ledgers.

How Propty handles special assessments

Propty ties the special-assessment workflow to your budget and reserve data, so when you start an assessment it shows you immediately whether you're under or over the 5% cap for the year, prompts the secret-ballot member-vote path when you cross it, and generates the member notice with the right 30–60 day timing. The per-unit allocation follows the method in your CC&Rs, and every charge lands on the owner ledger with a record for compliance. For a volunteer treasurer, that's the difference between a defensible assessment and a challengeable one. See how it works for self-managed boards.

Frequently asked questions

What is the special assessment limit for a California HOA? Without a member vote, a board generally cannot levy special assessments exceeding 5% of the association's budgeted gross expenses in a fiscal year, and cannot raise regular assessments more than 20% over the prior year (Civil Code §5605(b)). Exceeding either requires member approval by secret ballot, except for qualifying emergencies.

Can an HOA impose a special assessment without a vote? Yes, if the total stays within the 5% annual cap, or if it qualifies as an emergency assessment under one of the three statutory categories (Civil Code §5610). Above the cap and outside an emergency, member approval by secret ballot is required.

What counts as an emergency special assessment under Davis-Stirling? An extraordinary expense required by a court order, one necessary to repair common area where a safety threat was found, or one for a common-area repair that couldn't reasonably have been foreseen — with a documented board resolution for that third category (Civil Code §5610).

How much notice does an HOA have to give for a special assessment? Individual notice, not less than 30 and not more than 60 days before the assessment is due (Civil Code §5615).

Do homeowners have to pay a special assessment? Yes — a validly levied special assessment is a binding obligation, and nonpayment can lead to late fees, a lien, and ultimately foreclosure. "Validly levied" is the key phrase: an assessment that broke the 5% cap or skipped the required secret-ballot vote can be challenged.

Propty is software for self-managed California HOAs and does not provide legal or financial advice. Consult an attorney or CPA for how the Davis-Stirling Act applies to your association's assessments. Citations were fact-checked against leginfo.ca.gov on 2026-06-02.