HOA reform back on Legislature's to-do list


By Tim Hull

Article Courtesy of The Green Valley News

Published January 27, 2005

GREEN VALLEY--Life and law in homeowner associations is once again the focus of a reform campaign in the Arizona State Legislature.

During last year's legislative session, lawmakers debated more than a dozen bills challenging some of the rules citizens must live by in Arizona's HOAs, passing several into law.

This year's session began recently with at least 17 new bills seeking changes in the way HOAs are operated, and in the duties and rights of those who own property and live within them. (See related story pg. A2).

The effort is largely one of the House, and involves both sides of the aisle.

"We have a group in the house, bipartisan, that has been very concerned about protecting the equity and lifestyle of people living in HOAs," said Rep. Ted Downing, D-District 28, a primary sponsor of several of the new bills.

"There are questions being raised nationally about the value of living in HOAs, and we have to make sure that in Arizona we establish rules and guidelines," Downing added.

Several of the bills introduced this session are based on resolutions passed in the Arizona Silver Haired Legislature late last year.

"We will be working very hard to make the 47th Legislative session as productive as last year's," said Barbara Epperson, a local resident and a delegate with the ASHL.

A majority of Green Valley residents live in HOAs--there are more than 80 in town--a reality that takes on an extra importance in an unincorporated area lacking in a centralized town government, where HOA governing boards often serve as the day-to-day governmental entity of local homeowners.

Battles, lawsuits

Rancorous battles and lawsuits involving HOA members who question the wisdom and authority of their association board of directors have split neighborhoods in recent years both nationally and locally, bringing to national attention the expanding influence of HOAs.

Reform advocates especially resent boards' powers to place liens on and even foreclose on private property for unpaid monthly dues, or for unpaid fines levied for infractions of a community's aesthetic guidelines.

Many towns and cities, especially those in the West and in retiree-heavy states like Florida, rarely approve new developments lacking an HOA structure to provide for basic services like trash pickup, road maintenance, snow removal etc.

There are an estimated 60,000 HOAs in the United States, home to more than 50 million people. Roughly 1.25 million of those people serve as volunteers on boards of directors.

These numbers come from the Community Associations Institute (of which the Green Valley Community Coordinating Council is a member), a nationwide group that advocates on behalf of HOA boards of directors.

Lobbying group

The CAI generally disputes legislation meant to take away or limit an HOA's power to run its community--especially when it comes to lien and foreclosures powers.

The group regularly lobbies lawmakers at the state level.

"We are certainly not blanketly opposed to any change," said CAI spokesman Frank Rathbun in a telephone interview this week.

"HOAs are not huge corporations, they are on budgets, and they have to provide services that people in that community expect--like street paving, pool maintenance, and street maintenance. Assessment (dues) are collected to pay for those services," Rathbun said.

"We believe that the lien and foreclosure process is ultimately necessary. If an HOA doesn't have that leverage, what does it have? If a lot of people say they're not going to pay, that can put an association in a real financial bind," Rathbun added.

The CAI disputes many of the HOA horror stories publicized in recent years--dark tales of foreclosures on homes for $150 in fines and similar loss of property because of the supposed whims of draconian HOA boards.

"You are going to have mistakes, misunderstandings, and miscommunications in any universe that size," Rathbun said.

Reformers "would like you to believe that everyone is clamoring for radical change--that is not true, and it's counterproductive," he added.

But Rep. Downing and other reformers see the issue more as one related to "protecting the wealth (and the property rights) of constituents," he said.

"There is a whole set of bills that say it's unfair to not recognize the property rights of people that own homes in HOAs-- we need to recognize those property rights," he said.

"All of these bills are just common sense, nobody is trying to kill HOAs, we're just trying to lay it down so we can all live together."

SEE: Local legislators focus on HOA bills