Everything You Need to Know About SB-721 (Chapter 445)

Property managers, building owners, and the real estate world at large have reason to be concerned in California. With the passage of the landmark “Balcony Law,” also known as SB–721, property owners are now financially responsible for periodic, destructive testing of their property’ balconies, decks, and walkways (also known as external elevated elements). And the law doesn’t just make property owners responsible for the inspections and repairs—it also gives them strict deadlines under the threat of civil penalties and heavy fines.

Under SB-721, almost all wood-based external elevated structures have until January 1, 2025, to be inspected. But there’s so much more to learn about the new Balcony Law. Like most laws regulating real estate, SB-721 has complex ramifications for property owners in California.

Background

The bill was sparked by a tragedy in 2015, when a Berkeley apartment complex’s balcony collapsed, killing six students. Experts showed that the balcony was inadequately waterproofed and was missing a layer of draining membrane, allowing the water absorbed into the balcony’s concrete to leak onto the waterproof layer, and which then rotted load-bearing wooden frame of the balcony. An investigation also found that the property manager delayed maintenance despite there already being indications of water damage. After a lengthy legal battle, the families of the victims recently won a multi-million-dollar settlement against the company managing the property and the owners of the building.

The tragedy sparked a national conversation about who’s held accountable for the structural integrity of residential buildings. But more importantly, it spurred California lawmakers to pass SB-721, a statewide law requiring the owners to get regular, stringent inspections of their external elevated elements. After the bill was signed by former Governor Jerry Brown in 2018, the law came into effect on January 1, 2019. The law created the California Health & Safety Code §17973 while modifying Civil Code §1954 to allow landlords to implement the new requirements. The law is also now called Chapter 445, but thanks to the intense controversy behind the bill, most in the real estate world still know it as SB-721.

Who’s Affected

The new balcony law applies to buildings with 3 or more multi-family dwelling units–in other words, thousands of apartment buildings in California. While a last-minute amendment to SB-721 excluded condos, developments, and apartment projects, apartments who converted to condos after January 1, 2019, are still required to be inspected before the first close of escrow.

What Counts as an Exterior Elevated Element?

The “balcony law” applies to much more than balconies, including:

• Decks
• Porches
• Stairways
• Walkways
• Entry structures more than 6-ft above ground level

In particular, SB-721 applies to structures that are mostly made of wood or have a wood-based framework. This means that steel structures are not regulated by SB-721, but local laws may be more stringent.

What Are the Deadlines & Fines?

Property owners have until January 1, 2025, to have their wood-framed external elevated structures inspected by a qualified professional. After that, they must have their external elevated structures inspected every 6 years.

In the event that inspectors do find cause for repairs and the owners of the buildings don’t comply within 180 days, the inspector will notify local law enforcement and the owner of the building. If repairs are not done 30 days after the notification, the owner will get a civil penalty: around $100-500 dollars for every day the repairs are not completed.

There’s some good news: under SB-721, owners who got an inspection 3 years prior to January 1, 2019, won’t need another inspection until after the January 1, 2025 deadline.

What’s the Purpose of an Inspection?

The inspections for SB-721 are destructive in nature, meaning they will need to chip away past the surface of the external elevated element to evaluate the framing beneath. Inspectors are required to take samples of at least 15% of the load-bearing components of the balcony, so they have a representative sampling for buildings with hundreds of units. Inspectors are also required to specifically take samples of the waterproofing elements.

What SB-721 Inspections Need to Do:

SB-721 also sets forth regulations on how inspectors analyze and report these structures. For example, inspectors have 45 days to present their findings to the owners of the property. However, if immediate repairs are needed, then inspectors have 15 days to present a report to the property owner and give a copy to local law enforcement.

Since the balcony law regulates inspections in perpetuity, there are rules stating property owners must keep the inspection reports for at least 2 inspection cycles. If the building is sold, the inspection reports must be provided to the buyer. Local law enforcement can also ask for a copy of the inspection report.

Objectives of an Inspection

A complete inspection will include photos, test results, and a baseline that can be used to compare to future inspections. For inspectors, an external elevated element is subject to repair when they’re so defective, decayed, or deteriorated that they don’t meet load requirements and may be dangerous to residents. Inspectors will also asses how the elevated structures may perform in the future.

Who Can Perform Inspections for SB-721?

SB-721 is unbelievably precise about who can perform the inspections:

• Licensed architects, licensed civil or structural engineers
• Building contractors with “A” “B” or “C-5” license classifications with a minimum of 5 years’ experience
• Or individuals certified as building inspectors or building officials from a recognized state, national or international association, as determined by the local jurisdiction

What Happens If Repairs Are Needed?

There are three common outcomes after an inspection:

1. No Repairs Needed
   The inspection shows their balconies are structurally sound and have proper waterproofing elements, so no additional repairs are required.
2. Non-Emergency Repairs
   This means the inspection determines that non-emergency repairs are required. In this situation, the owner must apply for a permit to make repairs within 120 days of receiving the report. Once the permit’s approved, the owner has another 120 days to make the repairs.
3. Emergency Repairs
   This means the external elevated elements are not structurally sound, may be dangerous to the safety of residents, and require immediate emergency repairs. Subsequently, any repairs made must again be inspected and reported to law enforcement.

What Makes a Good Inspection?

Why is SB-721 so stringent? Why did they emphasize destructive testing in their inspections? Strict standards in SB-721 aside, how can a company provide property owners and property managers with a proper inspection?

One of the most important principles in inspections is that visual assessments are not enough to properly analyze a structure. While there was outright negligence in the Berkeley case, experts know that the wooden framework relies on a complex system of waterproofing and engineering that can’t be evaluated without diving underneath.

For one thing, owners should consider how external elevated elements are constructed; critical connections and load-bearing structures are often concealed by materials like stucco and concrete. So, with destructive testing, inspectors can adequately evaluate the structural integrity of the balcony and the waterproofing elements. Of course, a skilled inspector can take samples without damaging the integrity or the look of the external elevated element.

And while SB-721 is exacting for so many property owners in California, it should be seen as an opportunity to give residents peace of mind about their health and safety. Inspection, and expert waterproofing, in general, are priceless investments that protect property value and strengthen the relationship between residents, property managers, and owners. Thankfully, there are certified waterproofing and maintenance professionals like the ones at WICR that understand the law and will go above and beyond to help owners avoid astoundingly steep fines and legal action. If you have any more questions about SB-721, contact WICR for advice. And more importantly, to get a proper, thorough inspection by an elite team of waterproofing experts.