The findings of the Colorado HOA problem identification report are as follows, and substantiate the fact that HOA democratic governance is sorely lacking:
What we discovered was that the complaints we received primarily involved the board of director’s failure to follow corporate governance rules and procedures of the HOA; the transparency of the board of directors, particularly as it related to the finances of the HOA; and harassment and bullying of homeowners by the board of directors and management company by arbitrary fining, preclusion from providing input into the associations’ affairs, and verbal harassment. These complaint types were much more serious than the aforementioned three P’s because they substantially interfered with a homeowner’s ability to enjoy his property and to have avenues of democratic participation in the HOA to remedy their issues.
An additional and perhaps one of the more troubling complaint types the Office heard was that the HOA board or manager was harassing, discriminating or retaliating against homeowners. Many homeowners felt that their boards had singled them out and were arbitrarily fining them for violations, when they were not in violation; engaging in selective enforcement of covenants; and precluding them from participating in meetings. . . . A frequent complaint heard was that older board members were discriminating against younger homeowners or where older homeowners felt they were discriminated against by younger board members.
Another troubling subset of complaints involved diversion, fraud, and theft. . . . The most frequent complaint types filed against managers mirrored those pertaining to HOAs, including access to records, transparency and communications, not communicating with homeowners, harassment and selective enforcement of covenants
And the report makes the following, not unexpected, observation, which can apply to all HOA legislation in all states (emphasis added).
The drafters of SB-100 and SB-89 obviously understood the need for statutory protections to homeowners, but the issue homeowners are having is not that the law does not address their specific issues, rather the law does not provide a realistic or economic means to seek redress.
The lack of such realistic means for redress can be found in the public policy of each state to support and protect the HOA even against unjust and unconstitutional denials of homeowner rights and freedoms. One very effective and proven means is to provide for effective penalties against HOA violations of the laws and governing documents in the name of the people. That means sufficient fines and even misdemeanor charges as warranted, especially when considering such penalties are imposed for wrongdoing by a government official or agency.
2. “Hannaman Report”, (Similar report in NJ, 2002).
3. The StarManPub videos on the Florida House HOA hearings (2008).