The Public Report Process is usually the critical path in a residential subdivision. With that in mind, we encourage our clients to initiate the process as early as possible. The Department of Real Estate (DRE) process requires a minimum of four months’ processing time at DRE. Following is a chart that outlines the DRE response times that are mandated by law.
| COMMON INTEREST | STANDARD | PROCESSING STEPS |
| 10 days | 10 days | Substantially complete notice (file acceptance) |
| 60 days | 20 days | Qualitative deficiency notice (initial file review) |
| 30 days | 20 days | Response to deficiency corrections (review of deficiency response submittal) *this step can be repeated multiple times |
| 15 days | 10 days | Public Report issuance (after the file is deemed “perfected”) |
| 115 | 60 | TOTAL MANDATED TIMES FOR FILE REVIEW |
While it is possible to process a public report from beginning to end within these minimum time frames, it is important to note that the final subdivision map must be recorded prior to or within the processing time, and the management documents (CCRs, etc) must be approved and recorded. The vast majority of public report filings take a little longer than the minimum filing periods because coordination of deficiency responses and recordation of the subdivision map and documents takes longer. Even starting with a recorded map, additional time must be allowed in order to provide responses to DRE questions, and to coordinate the recordation of the final documents. Our office will encourage you to allow for one deficiency, plus an additional 10-20 days for obtaining bonds and coordination of recorded documents. With these allowances added, the processing time is then closer to six months. Allowance of four months for a standard subdivision and nine months for a common interest subdivision is reasonable. The initial phase of a complex development could take as long as one year for DRE approval.
To streamline, we recommend that the process commence as soon as the governing agency has awarded tentative map approval, however, it is important that structural decisions for the development have been made prior to initial submittal to DRE. Changes later on will result in delays in the process. Some of these decisions are:
- Phasing program for the marketing and sales
- Establish the advertising name
- Creation of the sales entity. If the ultimate selling owner entity is not in title yet, we can still submit early, however evidence of future vesting must be provided
- Established signing authority for the owner and sales entities must be documented. Be prepared to submit copies of the authority for the entities involved
- If the entity includes a layer of different entities, specific authority documents must be provided to avoid a waterfall signature block
- In a phased development, submit only the initial phase and obtain qualitative approval before submitting subsequent phases
If your project is a common interest development,
- Work with an attorney who maintains pre-approved “MMD’s” (master management documents) with the DRE
- Work with an experienced budget preparer who is familiar with industry requirements for budgeting and management of common interest developments and long-term reserve requirements
- If your company develops multiple subdivisions, consider applying for Statewide pre-approval of your purchase and sale agreement
