Thank you East Mesa Independent and Dianna Wenner for the article regarding HOAS and the Homestead Exemption.  Hopefully we advocates for the homeowners are getting our message out to the consumer.

But with regard to remarks in this article made by Mr. Curtis Ekmark, Ekmark and Ekmark law firm and President of CAI, Community Associations Institute (a vendor organization) I would like to fill in the blanks.

As Ms. Wenner stated CAI is an "HOA Advocacy Group"...translated that means that CAI represents the Boards, the Management companies, the HOA Attorney (of which he is one) and all the Vendors who make their living from the homeowners assessment money.  In fact, CAI pays for their lobbyist and legislative activity in part from the homeowners assessment money, although the homeowners are not aware of this.  Some HOAS send $1.00 per door to CAI, ask yours if it does.  CAI does not represent the individual homeowner!!  CAI has fought every bill the homeowner advocates have ever supported!!

Mr. Ekmark claims "he has never heard of a homeowner losing a home for a minor infraction".  This seems to be a case of selective memory.  Has he forgotten it was his law firm who foreclosed on "Marie Brown"?  I don't have the room here to list all of the "frivolous penalties" pursued by his and other HOA law firm.

Mr. Ekmark fails to tell you that most homeowners pay the "frivolous penalties" because the "out of sight" legal fees attached make paying the lesser of two evils...the homeowner doesn't pay because the penalties and fines are valid but that fact is never disclosed.  Remember the HOA doesn't even have to go to court to PROVE their allegations.  In one breath Mr. Ekmark says he has never heard of anyone losing their home and in the next breath he is telling you  "associations all over the state every week are working out payment plans".  Then this statement from Mr. Ekmark, "They (the associations) don't make money by foreclosing on somebody".  Of course not, the only thing the HOA gains is a fractured community and an empty house (one that is not paying assessment).

I even know of one association that has slapped a lien on a property because they have termites.  Do you suppose it is illegal to have termites?  Do you believe that an HOA can force a homeowner to treat their property for termites?  I guess it doesn't really matter, the only person benefiting is the attorney and his law firm...AMAZING!!!

Mr. Ekmark's statement about the association not making any money is the truest fact I have ever heard but it doesn't explain who DOES make money by foreclosing...it is the HOA Attorney and the Management company.  Don't believe CAI, Mr. Ekmark and those who tell you foreclosure is a MUST, these people most certainly have a CONFLICT OF INTEREST. 
That CONFLICT is $$$$$$$.

And with Mr. Ekmark's condescending remark about not being able to legislatively force someone to "read all that stuff", maybe not, but maybe, just maybe if when the homebuyer were asked to "Please sign this ADHESIVE CONTRACT between you and the HOA", people would pay attention.  And if homebuyers knew that they were signing away their right to the $100,000 Homestead Exemption and their Constitutional rights we might start seeing the consumer demanding changes in "Truth in Buying".

Yes, CHORE does believe that all residents of HOAS should pay their assessments and we are not against HOAS.  But Board of Directors must be responsible and accountable to the homeowners for their actions.  If the Board is NOT "taking care of the community" will they be fined and removed from office..NO they will not.  The only "well reasoned solutions" is ENFORCEMENT of the statutes on the books by the Attorney Generals office and disallowing foreclosure by HOAS. 

A "well reasoned solution" says Mr. Ekmark!  I know that Rep Eddie Farnsworth, representing the Citizens of Arizona and myself, representing CHORE and homeowners, wait anxiously as CHORE has for 4 years to hear ANY solution that is "well reasoned" from Mr. Ekmark and CAI.

The only "well reasoned" solution to the problems with HOAS is to remember 'DO NO HARM'

    Homeowner association critics, led by Rep. Eddie Farnsworth, say state law gives HOAs too much power and promise to again try to change the law when the legislature reconvenes in January.

    "I don't want to prevent (HOAs) from collecting fees that are legitimately owed to them," said Rep. Farnsworth, R-District 22, "but I don't want them to be able to take a homeowners home for a piddley offense and I certainly don't think they should be exempt from the Homestead Exemption."

    Curtis Ekmark, president of the Community Associations Institute, an HOA advocacy group, said he has never heard of a homeowner losing a home for a minor infraction. But, he said it is critical that people pay their dues in order to keep a neighborhood running.

    "The association would end up wasting a lot of time and money (pursuing frivolous penalties) and it wouldn't be good for anyone," he said.

    What is agreed upon is that lawmakers will undoubtedly wrangle over the subject during their 2004 session.

    Law too tough

    According to critics of the existing law, which was originally passed in 1996, HOAs have the power to take someone's home for violations they don't even have to prove.

    The Arizona Homestead Exemption is a state law protecting homeowners up to $100,000 from losing their homes to creditors, but members of HOAs are not protected under that law, said Pat Haruff, president of CHORE (Coalition of HomeOwners for Rights and Education), and critic of HOAs.

    "(Under the Homestead Exemption) if I have a $100,000 home and I hire a contractor to build a pool and I don't pay them, a judge can say I owe them $20,000 and they can put a judgement lien on the home, but they can't foreclose and take my home," she said. "They don't have that statutory right. The only way they're going to get that $20,000 is if I sell my home."

    Not so in an HOA, said Rep. Farnsworth.

    "The Legislature passed a law (HB 2299 in 1996) saying that HOAs have automatic lien authority," he said. "All they have to do is say you did something wrong and then they can file a lien on your home."

    HOAs can put a lien on a home to collect unpaid membership dues or to collect unpaid fines for breaking rules, such as leaving a garbage can out too long or not mowing the grass, he said. 

    And because HOAs don't have to go to court to file the lien, they don't have to prove the homeowner did something wrong. 

    After filing the lien, an HOA has the ability to foreclose after 90 days, Rep. Farnsworth said.

    The HOA isn't required to sell the home for a fair market price, so it can sell the home for just enough money to pay off the mortgage lien and take its own fees, leaving the homeowner with nothing, he said.

    "So you can lose your house and . . . (your) equity because you didn't take in your garbage can or you missed six months of assessments . . . and that seems like an incredibly harsh penalty to me for crossing your HOA," Rep. Farnsworth said. "They have essentially been given the same priority as a lender and what that means is the Homestead Exemption does not apply to them."

    Foreclosures last resort

    HOAs don't really benefit by foreclosing on homes and the vast majority of foreclosures are for unpaid dues rather than fines, according to Curtis Ekmark, of the Community Associations Institute's Central Arizona Chapter.

    "I've yet to hear about a case where someone lost their home over a garbage can or weeds or something like that," he said. "That would be idiotic." 

    Mr. Ekmark calls the subject a difficult issue and insists foreclosures are a last resort.

    "HOAs are non-profit entities that need to collect their assessments in order to maintain their communities, but associations all over the state every week are working out payment plans and waiving assessments and dues for people who have financial problems," he said. "They don't make money by foreclosing on somebody."

    Ms. Haruff said HOAs were around for decades without going bankrupt before the 1996 Legislature passed HB 2299, so she doesn't believe it is needed to keep HOAs afloat financially.

    Another problem, according to Ms. Haruff, is people are unaware of the fact that they are giving up their Homestead Exemption by joining an HOA, because there is no law requiring the HOA to tell the homeowner.

    "When they sign the CC&Rs, they are signing over their constitutional rights and they are waiving their right to the Homestead Exemption protection, but that is never disclosed," she said. "We want to make sure the . . . consumer has the information they need to make the decision, and if they still do it, that's on them."

    Middleground?

    Mr. Ekmark said he agrees homebuyers should be more aware of a variety of issues when they purchase a home.

    "I would be all in favor of some type of disclosure requirement, but the issue is can you legislatively force people to read all that stuff that they get?" he asked.

    Rep. Farnsworth worked on legislation last year that would have "limited the ability (of HOAs) to foreclose on homes and would have removed their status as a secured creditor," but the bill died in the senate. 

    He said he plans to sponsor similar legislation this year.

    "We don't want to get rid of HOAs, we want to create a level playing field so the public is educated," Ms. Haruff said.

    Mr. Ekmark said he looks forward to sitting down with Rep. Farnsworth and Ms. Haruff to work on a "well-reasoned solution."