Homeowners' rights groups fight back

New state laws give more power to residents facing conflicts with associations

       

Article Courtesy of The Arizona Republic

By Cary Aspinwall

Published August 14, 2005

  

Tina and Brian Crossley knew they were moving into a neighborhood with a homeowners association when they came to Gilbert from Ohio in June.

But it wasn't until they received a 200-page book of the association's rules and documents before moving that they realized it meant they would have to leave their toddler's swing set behind. It was too tall, and its bright circus colors weren't allowed, only muted shades of taupe, white and brown.

"I knew there were going to be some fees we'd have to pay, but I about fell over when I got that book in the mail," Tina said.

Across the country and in Arizona, increasing numbers of homeowners associations are watching for weeds in the yard, prohibited paint colors and unapproved renovations or remodels.

Last week Arizona's newest HOA laws went into effect, making it easier for residents to remove board members and eliminating proxy voting, among other changes.

Homeowners' rights groups and the author of the new legislation, Rep. Chuck Gray of Mesa, have touted the HOA reform package passed under House Bill 2154 as a way to resolve many of the conflicts within HOAs.

An estimated 54 million Americans live in areas governed by homeowner and condominium associations, and the number continues growing, according to the Community Associations Institute in Alexandria, Va. There are as many as 9,000 HOAs in Arizona alone.

So who's watching the growing number of HOAs?

Officially, no one, at least in Arizona. HOAs act as de facto minigovernments but are usually classified as private, non-profit corporations.

They have powers that most private corporations don't - they can foreclose on a home if the homeowner doesn't pay assessments. Yet there's no government agency required to monitor or regulate the everyday workings of HOAs.

That's what George Staropoli discovered about five years ago when his Phoenix HOA decided to gate the neighborhood's entrance, a decision he didn't agree with.

"These (HOAs) are really governments," Staropoli said. "But the concept of a democracy with majority rule but minority rights is lost."

He lost the fight on the gated entrance and remained in the community, but he continues to fight against HOAs by lobbying with the group he started, Citizens for Constitutional Local Government.

Homeowners in Arizona who disagree with fines they are charged or want to fight a lien placed on their property by an HOA have only the HOA to appeal to, he said. Or they can file a civil lawsuit at their own expense.

The state Legislature has typically passed a new slate of laws each year meant to clarify or restrict the power of HOAs. The primary features of this year's batch include a simplified process of removing HOA board members from office, eliminating proxy voting and ensuring that homeowners' payments are first applied to any unpaid assessments.

An entire cottage industry of property management groups, attorneys and homeowners' rights lobbying groups has sprung out of the debate.


 Want to better train your board members or community manager? Sign them up for the CAI Community Leadership Forum, Oct. 20-22 in Atlanta.


 Neighbor refuses to trim his weeds or pay his assessments? Call Curtis Ekmark, a Scottsdale attorney who deals solely in HOA law, one of several such attorneys in the Valley.


 Frustrated with your HOA board for not letting you speak at meetings? The Coalition of Homeowners for Rights and Education or the American Homeowners Resource Center will advise you of your rights.

And Arizona is hardly alone when it comes to the battle between the growing HOA industry and homeowners' rights advocates lobbying for sweeping reforms.

Nevada first tried a "common interest communities" ombudsman, and when that wasn't enough, added a five-member commission with the legal power to order settlements, fine board members or remove them from office.

Florida has a state Homeowners' Association Task Force. In 2001, the Texas Legislature banned foreclosures for violations of community rules.

Californians are arguing over a bill that would ban foreclosures unless a resident owed more than $2,500 in assessments, a bill that Gov. Arnold Schwarzenegger vetoed the previous year.

Arizona legislation passed in 2004 that prevented HOAs from foreclosing on homeowners for unpaid fines was known as the Marie Brown bill, after the Peoria woman booted from her home by her HOA for not trimming her bushes. The house was sold at auction because Brown refused to pay her HOA fees, plus the cost of court-ordered trimming of her trees and legal fees.

Her case and several other conflicts have made national headlines, including a Gilbert HOA in 2003 trying to foreclose on the home of a woman dying of cancer, or the Peoria man who stormed into a homeowners' meeting in April 2000 at the Ventana Lakes clubhouse and began shooting, killing two.

Association vs. homeowner conflicts in other states have also generated buzz in the debate.

An 83-year-old woman in Tequesta, Fla., recently battled her community in federal bankruptcy court because she owed nearly $1.8 million in fines for years of having a yard full of overgrown plants.

A few years ago in Texas, an 82-year-old widow was evicted over $814.50 in unpaid dues.

A California association foreclosed on a couple because they failed to pay $120 in assessments.

Although the Marie Brown bill, which passed in 2004, prevents HOAs from foreclosing because of unpaid fines, efforts in Arizona to prevent HOAs from foreclosing because of unpaid assessments remain unsuccessful.

"It's not fair. You can lose your house, but they (the HOAs) can't even get a slap on the wrist if they do something wrong," Staropoli said.

Despite their HOA's many rules, the Crossleys say they love Gilbert's Neely Commons and have been greeted by neighbors with trays of brownies and cookies.

They were concerned about buying in an HOA originally, but they toured non-HOA neighborhoods and were unimpressed, Tina said.

"All the rules were a little shocking at first, but it's beautiful and we love it," she said.
         
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