model HOA regulatory agency bill

shockingThe attached was submitted to AZ legislators.  The model bill should be tailored to your state’s laws.  The sections under 41-2000 et seq. are the amendments that should be included as part of any similar effort to create a level playing field for homeowners.

 From: George

Sent: Monday, January 26, 2015 6:11 PM

Subject: department of HOA is desperately needed as DFBLS is doomed

Dear Arizona Legislators,

I quickly put together a solid bill (attached) based on a Florida bill and adapted to Arizona to help relieve continued legislative involvement in what should be handed by a bona fide regulatory agency.   I took pains to write a good bill in conformity with the drafting requirements and I hope it will ease your review.

I well understand the current atmosphere of no government interference, but the gross and shameful treatment of HOA members by the HOA stakeholders demands justice.  It is not a question of misplaced dogma, but of treating all the people equally under just and fair laws.

The proposed bill summary reads:

Summary.   This bill establishes a department of homeowners associations with full direct regulatory authority over Ch.9 and Ch. 16 associations under the direction of a commissioner. It provides for receiving complaints, investigations, filing legal actions, issuing civil penalties, rulemaking, and establishing an Advisory Board to provide recommendations to the commissioner.  Funding is provided by a $4 per unit fee per year.  The processing of HOA disputes by DFBLS is stricken.

My proposal brings a more level playing field in that the proposed Advisory Board will be balanced in favor of the members, and does not consist of any HOA stakeholder vendor lawyers or managers.  It’s the people’s vehicle for justice.

I urge you to stand behind the effort and sponsor the bill, and campaign for its passage.  I will be happy to meet with any legislator to explain the bill and answer any concerns.

Respectfully,

George K. Staropoli

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Published in: on January 27, 2015 at 5:56 pm  Comments (10)  
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  1. […] Last Friday, June 5th,  I emailed a revised AZ model bill to AZ legislators for sponsorship in January 2016.  It was initially drafted this past January, too late for introduction in 2015.  See model HOA regulatory agency bill. […]

  2. […] model HOA regulatory agency bill […]

  3. George, your bill is excellent. I am working on a similar legislative fix this year to have the Florida DBPR at last enforce HOA laws obviating the necessity of cost prohibitive lawsuits. The other idea about right to own property without mandatory association membership is good but I fear faces bigger legislative obstacles. Respectfully, Ralph in Florida

  4. TL;DR

    That means: “too long; didn’t read”. Nor do I have any idea what “DFBLS” is, so you lost me from the beginning. Instead of 26 pages of legalese that I cannot understand, how about prohibiting mandatory membership in an H.O.A. corporation as a condition of home ownership? For example:

    Right To Home Ownership Without Membership In An H.O.A. Corporation

    No person shall be denied the opportunity to purchase or own residential property because of non-membership in an H.O.A. corporation, nor shall the State or any subdivision thereof, or any corporation, individual or association of any kind enter into any agreement, written or oral, which excludes any person from home ownership or continuation of home ownership because of non-membership in an H.O.A. corporation.

    It’s not a radical proposal, becuase it’s taken directly from Arizona’s “right to work” law :

    Ariz. Const. art. XXV

    Title 23. Labor
    Chapter 8. Labor Relations
    Article 1. Right to Work

    ARTICLE 1. RIGHT TO WORK

    Right To Work Or Employment Without Membership In Labor Organization

    No person shall be denied the opportunity to obtain or retain employment because of non-membership in a labor organization, nor shall the State or any subdivision thereof, or any corporation, individual or association of any kind enter into any agreement, written or oral, which excludes any person from employment or continuation of employment because of non-membership in a labor organization. (Addition approved election Nov. 5, 1946, eff. Nov. 25, 1946; amended November 30, 1982.)

    If home owners are given the statutory right to “opt-out” of their H.O.A. corporation, the problems with H.O.A. corporations will solve themselves. It will remove the perverse incentives and moral hazards that are built into the H.O.A. system. H.O.A. corporations will have to start treating home owners like customers, whose business must be continually earned, rather than the status quo of treating home owners as a captive revenue stream for Tom Skiba and his minions.

    • PS — That being said, I should commend you for doing the work and actually writing a specific proposal. One of my complaints about whatever it is that passes for an “H.O.A. reform movement” is that there is a lot of complaining, but almost nobody comes up with any ideas about what should be done. Oh sure, there are a lot of platitudes thrown around (e.g., “restore rights to home owners!”), but almost nothing that can be translated into a real policy. You have come up with something that can be taken to legislators and put into law.

  5. Interesting. I downloaded and read through the first part of this bill–I like that it says “according to the delcaration” but of course boards don’t follw the doucments as Karen wrote above.

    We had to write bylawas that prohibited the “association” ie the board from ” Make contracts and incur liabilities.” or do budgets or even create rules WITHOUT A VOTE OF THE MEMBERS. This is becasue one board signs a contract with their buddies, corporate law says the next board has to honor it–AND the members pay through the nose for somehting they never wanted in the first place. So theorectically our board cannot hire a mamager, write a rule, sign a contract, or incur a liability over $500 without a vote by members–it is the only way to limit their abuse of power becasue they rationallize that what they want is good for everyone. I would be scared of this bill without clear limits on the power that can be exercised by a board without the consent of the members.

    • If you read my post carefully, I said sections 41-2000 et seq. were the actual reforms to be sought in your state to create the regulatory agency. The remainder of the bill pertains to Arizona only and serves to see the connection between the Commissioner and the AZ statutes.

    • Excellent idea!!! Since I wrote that, I have learned that our President had the management company sign an agreement under her signature alone (don’t even know if the Board knows about it yet) prohibiting the Management company from dealing with anything in regardings to one Board member she has a vendetta with who sat on the previous board that she wants off (probably a violation of the Open Meeting law); had a section put in the management company contract prohibiting them from contacting the HOA lawyers without her permission or her being present. It gets worse day by day.

  6. Mr George Staropoli, THANK YOU for your proposal for HOA governance. Your idea and proposal is EXCELLENT. Texas can use your proposal to address its problems too. Thank you again. Albert

  7. It needs to include abuse of power as well. That is perhaps the biggest problem with HOA’s I’ve been involved with. Our Board just voted to have trees on the median removed because it was affecting a Board member and his neighbor’s pool pump and the Board member didn’t recuse himself from voting; the Board voted to have themselves reimbursed for a failed recall election from HOA funds and non of them recused themselves again; the President passed a motion where she could remove any homeowner she considered disrespectful or disruptrive for 30days plus charge them for the room rental fee and prevent them from being on the school property (even though their kids may attend school there); etc, etc.


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