Two bills that change the code enforcement process in California were signed recently by Gov. Jerry Brown - AB 2495: Cost Recovery in Criminal Code Enforcement Cases and AB 2485: Local Agency Inspections Cannot Include Persons with Potential Financial Interest. A third, which is related to cannabis cultivation, was signed Tuesday.
 
AB 2495: Cost Recovery in Criminal Code Enforcement Cases
 
Assembly Bill 2495 puts limitations on cost recovery in criminal code enforcement cases. Passed in the California Assembly and Senate with almost unanimous support, the bill limits local agencies’ ability to recover costs under certain circumstances.
 
AB 2495 adds section 688.5 to the Penal Code, which prohibits a local agency from charging a defendant for the costs of an investigation, prosecution or appeal in a criminal case, such as criminal violations of a local ordinance.
 
Various state laws authorize local governments to declare what is a nuisance, and also to approach code enforcement either administratively, civilly or criminally. A local entity may also pursue cost recovery options as long as they have adopted a local ordinance specifically allowing for it. Typically, costs are recovered in connection with civil litigation or administrative enforcement actions. Before adoption of AB 2495, some cities also sought recoupment of various enforcement costs in connection with criminal cases.
 
In November 2017, the Desert Sun uncovered two cities using the same private law firm that took property owners to criminal court over violations of local ordinances. After the conclusion of a criminal case, the law firm would attempt to collect the prosecution’s code enforcement costs. The Desert Sun (and later state legislators) took exception with this process.
 
AB 2495 was drafted in response. Before this change in the law, the recovery of attorney’s fees in connection with a criminal case was sought by some, but not all local agencies. But numerous local agencies regularly sought recovery of investigation costs and other costs incurred by code enforcement staff. Reimbursement of these enforcement costs was typically transparent —accomplished either by an agreement during the plea bargain process or by a judge’s order judge as restitution.
 
Although the law does not go into effect until Jan. 1, 2019, the change may affect how attorneys and courts handle pending cases in which this recovery is sought. Cities and counties should revise their ordinances that purport to authorize cost recovery in a criminal context. Municipalities may still recover costs through administrative processes, but local agencies will no longer be able to seek costs related to the investigation and prosecution of a criminal case.
 
AB 2485: Local Agency Inspections Cannot Include Persons with Potential Financial Interest
 
In response to a newspaper report of possible inappropriate behavior by a code enforcement officer and independent contractor, the state Legislature passed AB 2485.
 
The alleged incident involved an inspection by a code enforcement officer and a private contractor. After the inspection, the contractor offered to correct the violations for a quoted price. The quote provided was higher than the quote previously received by the business owner, but he feared that if he did not use the contractor at the inspection, it could result in delays in getting the applicable permits approved.
 
As such, this bill implements a new law that prohibits code enforcement and health officers from having individuals with a potential financial interest join the inspections of commercial property or businesses. A “person with a potential financial interest in the outcome of the inspection” is defined by the bill as:

1. a person who offers to remediate, for compensation, those violations found during an inspection or
2. a person who offers to compensate a code enforcement or health officer for recommending a specific person to cure the violations or
3. a person who provides the name of the owner to someone who offers remediation services.

The bill explicitly allows the business or property owner, including their agents or representatives, to join the inspection. Further, a person can join if he or she is under contract with the local agency to provide inspection, abatement, legal or remediation services. Finally, the bill provides that contractors or consultants can join if that person is on a publicly available list of qualified bidders that provides inspections, abatement or remediation services for which they receive compensation from the local agency.
 
For those under contract with a local agency to conduct inspections, abatements or remediation services, and who conducts an inspection without a code enforcement or health officer, they are prohibited from soliciting or receiving compensation for curing any of the violations identified.
 
Notably, none of the above applies to any inspections where the code enforcement or health officer has provided written notice identifying the violations present at the property and all necessary corrective action. Further, the legislative record shows that California Building Offices opposed the bill, though the bill does not appear to apply to inspections covered by building officials.
 
Other Code Enforcement Bills to Watch
 
It’s also worth noting there are several other bills have passed the Legislature and are awaiting action by the Governor:

• SB 1416 would explicitly allow local agencies to recover administrative fines through liens and special assessments.
• AB 2598 would allow local agencies to impose higher administrative fine amounts for violations of local building and safety codes and would require the local agency establish a hardship waiver process for repeat violators.
• AB 946 would limit a local agency’s ability to regulate sidewalk vending until it adopts a licensing programing for the same. The bill would further limit a local agency’s ability to restrict the location of vending unless it is directly related to objective health, safety and welfare concerns.

 Finally, AB 2164, signed by Brown Tuesday, will allow a local agency to impose administrative fines for municipal code violations related to cannabis cultivation without waiting a  “reasonable period of time” for corrections of building, plumbing, electrical or other similar structural or zoning issues.

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