Once a year every California association owes its members two packets: the annual budget report and the annual policy statement. They share a deadline, they have separate contents, and skipping either one has consequences, including losing the board's power to raise assessments without a vote. Here is what goes in each, when it goes out, and a checklist to build it from.
30 to 90 days before the fiscal year ends, and the policy statement shares the window.
Section 5300(a) says that notwithstanding a contrary provision in the governing documents, an association shall distribute an annual budget report 30 to 90 days before the end of its fiscal year. Section 5310(a) gives the annual policy statement the same 30 to 90 day window.
The step before the step. Section 4041 requires the association to solicit each owner's preferred and alternate delivery method, legal representative, and occupancy status every year, and to enter that data into its records at least 30 days before making the section 5300 and 5310 disclosures. Build that solicitation into your calendar first, or you will be mailing the packet to stale addresses.
Why the date matters. Under section 5605(a), a board that has not complied with the core parts of section 5300 for the fiscal year cannot impose an annual increase in regular assessments without member approval. A late or incomplete packet can turn a routine dues adjustment into a membership vote. Our guide to when a California HOA needs a member vote for an assessment covers that rule in detail.
Twelve required items, most of them about reserves, plus the disclosure summary form.
Section 5300(b) lists what the annual budget report must include unless the governing documents impose more stringent standards.
The reserve summary, section 5565. The summary must be based on the most recent reserve study or review under section 5550, count only cash or cash equivalents, and be printed in boldface. It includes, for each major component, the current estimated replacement cost, estimated remaining life, and estimated useful life; the amount of cash reserves the association should have at the end of the fiscal year and the amount it actually has; the percentage of the first that the second represents; and the current deficiency in reserve funding expressed per unit. That per unit deficiency is the line owners read first. If the numbers mean nothing to your board yet, see how to read your HOA reserve study.
The rules of engagement: where to write, how notices arrive, and how collection, discipline, and disputes work.
The policy statement is a separate document with separate contents. Section 5310(a) requires all of the following.
The penalty schedule deserves a fresh look this year. AB 130 capped most fines at $100 per violation in 2025, so a schedule that still lists larger amounts is out of date; see the AB 130 fine rules. The architectural approval summary is easier to write when your process is consistent; that is what ARC HOA is built for.
A standard form the statute writes for you, and it must ride along with every budget report.
Section 5570 sets out the form word for word, and section 5300(e) requires it to accompany each annual budget report or summary of the report. It answers, in one place, the questions a buyer or lender asks first.
Do not retype the form from memory. Copy it from the current statute each year so the wording matches.
Yes to both, as long as it goes by each member's chosen delivery method and anyone who asked for the full report gets it.
Section 5320 lets the association deliver either the full report or a summary that describes the contents and explains how to request the full report at no cost. A member who has requested full reports must receive the full report, not the summary.
Individual delivery. Both packets go by individual delivery under section 4040. That means the delivery method the member chose in the section 4041 solicitation, which can be a mailing address, a valid email address, or both. If a member never responded, the association uses first class, registered, certified, or express mail, or overnight delivery, to the address on file. If an email bounces, section 4041 requires the notice to be resent to another address the member identified.
Electronic records. Under section 4055, a writing requirement is satisfied electronically only if the record is capable of retention by the recipient. A link to a page that blocks printing or saving does not count. Send a PDF or a link to a downloadable file.
As of October 2026, sections 5300, 5310, and 5320 had not been amended for 2026. Section 4040 in its current form became operative January 1, 2023. Check again before your next packet goes out.
Print this, assign each line to a person, and check it off before the packet goes out.
The board usually adopts the budget at an open meeting before the packet goes out, so that meeting needs proper notice too; see how much notice a board meeting needs. Boards that also run their own elections should cross check dates against California HOA election rules. Self managed boards can fit all of it into the self managed HOA checklist, and the leasing rules in your policy statement should match what rental restrictions a California HOA can enforce.
The annual packet is the one time each year every owner gets the full financial picture, and it generates questions for months afterward. HOA180 Board Packets helps boards assemble the paperwork, and the Online Assistant answers owner questions from the packet itself, any hour, citing the page it used. See how the 24/7 Community Information Hub works, or start with the 30 day free trial.
Statutes change, courts interpret them, and your governing documents may impose stricter or different requirements than the Act does. Nothing here creates an attorney client relationship, and no summary can account for the facts of your community. Before your board acts on an assessment, a deadline, a fine, a rental rule, or an amendment, confirm it with your association's legal counsel.
HOA180 is not a law firm and does not practice law. Where this page states a specific number of days, dollars, or percent, we have taken it from the current Civil Code section cited alongside it or from the agency that administers the requirement; where the law does not set a number, we have said so rather than supply one.
Statutes cited: Civil Code § 5300 · Civil Code § 5310 · Civil Code § 5320 · Civil Code § 5565 · Civil Code § 5570 · Civil Code § 4040 · Civil Code § 4041 · Civil Code § 4055 · Civil Code § 5605
Last reviewed October 2026. Spotted something out of date? Tell us and we will check it.
Most of the owners who read this page are not on their board. That is fine. The fastest way to change how your community handles information is a short, polite note to the people who can. Copy this, change the name, and send it.
Hi [board president's name],
I came across a plain English guide on what the annual budget report and annual policy statement have to include and when they go out, and I thought it was worth sharing with the board: {URL}
It also mentions a service that answers homeowner questions any hour from our own CC&Rs and rules, with a community website included, for $89 a month with a free 30 day trial. I am not asking for anything, I just thought it might save the board some repeat questions and help owners like me feel informed. Happy to talk about it at the next meeting.
Thanks for the work you put in,
[your name], [your street]
Our Online Assistant answers homeowner questions from your community's own documents, the CC&Rs, the rules, the minutes, any hour, and cites the exact section it used. $89 a month, a 30 day free trial, no minimum term, and a full custom community website included. The board keeps every decision.
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