HOA Boards Should Install EV Charging Stations Now to Increase Profits and Attract Buyers
You’ve heard the saying, “when opportunity knocks, answer the door.” Well, as the governing body of your homeowner’s association, opportunity is knocking and promising a revenue stream you’ve never even thought about. Open the door.
Homeowners’ Associations (HOA) have rights when it comes to the installation of EV charging stations on community property. However, HOAs also have responsibilities under California law. It’s important that members of the board understand EV-related legal codes because arguing about whether or not to allow an EV charging station to be installed is a waste of time. However, the HOA can set guidelines for the process.
The California code covering HOAs and owners includes two very important points:
- HOAs in California must allow owners, within the guidelines of reasonable restrictions, to install EV charging stations for their personal use, or depending on parking rules* in the community, for general use by all residents with EVs.
- Condo owners must conform to the established HOA rules and regulations. The HOA has the final say as to the where and how the EV charging station will be installed.
*Reasonable Restrictions Permitted
Does each unit in your community have its own designated parking space? If so, California law states that a condo owner may install an EV charging station by their personal spot.
However, if all parking spaces are open to all residents, the HOA board has a lot more influence when it comes to selecting locations for EV charging stations.
Civil Code Section 4745 permits “reasonable restrictions” on the installation or use of an EV charging station. A “reasonable restriction” is defined as a restriction that does “not significantly increase the cost of the station or significantly decrease its efficiency or specified performance.” (Civ. Code § 4745(b)(2).)
This means HOA boards don’t have to rubber stamp all EV-charging station requests by condo owners. But, beware! If a condo owner decides to legally challenge something the HOA deems a “reasonable restriction,” there could be consequences.
HOA Boards Must Be Aware of Potential Fines
Truthfully, it’s best HOA Boards not “Fight City Hall” on this code. In fact, the code says the HOA may be liable for damages up to $1,000 (Civil Code section 4745) if it refuses a condo owner’s request to install an EV charging station. Further, the HOA would be liable for the condo owner’s attorney’s fees, should the case be litigated.
The HOA Board’s best strategy is to work with the owner of the unit and determine the best solution for all parties involved. California continues to move toward the green lifestyle by enacting regulations to make it easier, more cost effective and certainly more environmentally friendly for residents to trade in traditional combustion engine cars for sleek electric vehicles (EV.) This means EVs are here to stay.
Instead of thinking about a condo owner wanting to install a charging station as a burden, consider it a benefit! The installation of charging stations promises to increase property values and attract new residents.
What Steps Must a Condo Owner Take to Request the Installation of an EV Charging Station?
- If your HOA doesn’t have a specific process in place regarding how residents can make requests to install EV charging stations, now is the time to add such a process to the community’s rules (bylaws or guidelines.)
- Establish an approval process that is uniquely suited to your community. This will help to streamline the process for all subsequent applicants – and there will be many down the road. Count on it.
- Once a request has been submitted to the HOA by the condo owner, the law says HOAs are required to notify the applicant, in writing, within 60 days, about approval or denial.
- If the HOA board responds with questions within 60 days, the clock stops. Now the condo owner must submit answers to the HOA board’s questions.
Needless to say, it’s in the HOAs best interest to put these condo owners’ requests to install EV charging stations at the top of the to-do pile. If you neglect to notify your condo owner within the 60 days, the law states that the application is automatically approved.
Common Areas vs. Exclusive Use… What Does it All Mean?
Each condo development has its own unique features, and each HOA has its own unique governing documents. Generally speaking, the condo owner owns the inside of the home, while the exterior “common” areas including parking lots or garages are under the purview of the HOA. This interior/exterior designation puts the HOA in the driver’s seat.
While the law says you must allow the installation of an EV charging station, there is a lot of freedom given to the HOA to decide where it’s going to be located.
If each unit in your community has a designated parking space (exclusively used only by the owner of the unit), the HOA must allow the installation of an EV charging station there. The HOA, however, is allowed to enforce the following guidelines.
1. The condo owner must comply with the association’s architectural guidelines.
2. The condo owner must use a licensed contractor for installation.
3. The condo owner must provide a certificate of insurance that names the association as also being insured under the owner’s insurance policy. (This certificate of insurance is due within 14 days of approval.)
4. The condo owner must pay for the electricity usage costs associated with the use of the EV charging station, as well as the costs associated with the installation of the station.
In summary of No. 4, HOAs have no financial responsibility for the installation of EV charging stations (unless the board chooses to install stations for public use.) So, there is little reason to object to the owner installing the charging station in the first place; it’s an amenity for the HOA, at no cost to the HOA board!
HOA EV Charging Station Laws are Clear in California
What happens if a resident owner is assigned a parking spot in a location that makes it impossible to install an EV charging station or makes it unreasonably expensive?
The HOA is required to “enter into a license agreement with the owner for the use of the space in a common area, and the owner shall comply with all” of the approval requirements discussed above (Civ. Code § 4745(g).
If your community does not have designated parking space and residents park in any open space, can the owner still install an EV charging station? Yes, in California, residents of HOAs are permitted by law to have access to an EV charging station where they live. But again, the HOA gets to determine where the EV charging station will be located.
EV charging stations are absolutely an amenity residents seek out. If no parking spaces are assigned, the HOA board can choose to install one or more EV charging stations in a common area for all EV drivers. This will help to make your community stand out from neighboring communities.
The condo owner may also choose to install an EV charging station for the entire community’s use. They will do this at their own expense but it becomes a great amenity for the HOA because every condo owner in the community with an EV could park in the space and charge up.
Lucky for you, HOA board, that “someone” isn’t you!
So, here’s the BIG Question! Who Pays for the Electricity?
As the HOA Board, you don’t want to pay for anyone’s EV charge up any more than you would want to foot the bill for a full tank at a gas station!
The law is in the HOA’s favor! The HOA is not required to pay for anyone’s EV charging expenses — not the station itself, not the installation and not the electricity! And, as noted above in the guidelines (No. 4), the EV owner(s) who want to use the EV charging station must agree to pay for the electricity they use.
So, How Does the Electricity Bill Get Paid?
ShinePay, a cashless app, is a great way to resolve any questions about who pays for EV charging in a community governed by an HOA.When the EV charging station is installed, the cashless ShinePay system can be installed, too. If you already have an EV charging station installed, ShinePay can be added to existing charging stations to simplify payment, as well.
Here’s how ShinePay works:
- The HOA board (most likely the financial secretary, treasurer or whoever pays the community’s bills (such as groundskeeping or pool maintenance) downloads ShinePay’s web app and sets up an account.
- The resident, the EV owner, downloads the free ShinePay app onto a smartphone and sets up an account tied to their personal credit card.
- When they want to charge their EV, they open the app on their phone and scan the QR code on the ShinePay device at the EV charging station.
- Electricity flows and the EV owner’s credit card will be billed for the electricity used.
- The money goes directly into the HOA’s ShinePay dashboard, ready to be downloaded into a bank account so the electric bill can be paid on time!
Benefits of ShinePay for the HOA:
- When it comes to “public” EV charging stations (meaning any that are not installed for one single owner’s use at their assigned parking spot,) ShinePay makes it easy for each EV owner to pay for their own electric charge.
- When it comes to “private” EV charging stations (ones that are installed by EV owners at their assigned parking spots for their exclusive use,) it’s highly recommended that you request your condo owners to install ShinePay at their exclusive-use charging stations to assure the HOA has a streamlined process for paying in place. This can be part of the HOAs rules for installing EV charging stations.
Does your community have a clubhouse, gym, tennis courts or pool? Why not install a few strategically-placed EV charging stations, add the ShinePay system, and sit back, while you watch the dollars flow in. With ShinePay, you set the price for electricity usage.
Change is hard. But, change means progress. Work with your unit owners to facilitate the installation of EV charging stations. Or, better yet, take the initiative and install EV charging stations (with ShinePay) in available public spaces.
Then just add EV charging stations to your list of amenities – it’s a feature that future condo buyers will seek out and will put your community a step above others in this competitive housing climate.
*Here’s the civil code (Civ. Code § 4745(a).):
“A covenant, restriction or condition contained in any deed, contract, security instrument or other instrument affecting the transfer or sale of any interest in a common interest development, and any provision of a governing document, as defined in Section 4150, that either effectively prohibits or unreasonably restricts the installation or use of an [EV] charging station within an owner’s unit or in a designated parking space, including, but not limited to, a deeded parking space, a parking space in an owner’s exclusive use common area, or a parking space that is specifically designated for use by a particular owner, or is in conflict with [Section 4745], is void and unenforceable.” (Civ. Code § 4745(a).)