Who’s in charge of the larger HOA? The BOD or CAI?

Over the years I’ve come to believe that the CAI member HOA attorney are really in charge and run HOAs, especially the larger ones where the money really is.  Its influence runs the gamut from its CAI School of HOA Governance,[1] to pervasive lobbying state legislatures, and its CAI Manifesto.[2] The manifesto is its “white paper,” 2020 and beyond, in which it advises its followers to influence state legislators and the courts.

QUOTE Most legislators do not thoroughly understand common-interest communities or who their patchwork legislation is actually protecting. Legislators too often shoot from the hip, passing laws that ricochet and cause collateral damage. And they will continue to do so in the future unless the CIC interests undertake vigorous lobbying and education programs and awareness campaigns to enhance their understanding.“[p. 7][emphasis added]. UNQUOTE

In 2016 CAI published its survey[3] of large-scale associations (LSA) that revealed some insights into the strength and dominance CAI attorneys who are involved with the policies and operations of LSA HOAs. CAI  defines these associations as having more than 1,000 lots with an operating budget  of $2,000,000 or more, and that “provide municipal type services.

QUOTECAI’s Large-Scale Managers (LSM) Committee . . . provides input on education curriculum, best practices, public policies related to management or operations of large-scale community associations, or identifying what is of value to the large-scale manager membership” [p. 2]. UNQUOTE

By “municipal type services,” CAI explains,

QUOTE “Many municipal governments viewed this new community housing concept as a means to transfer various public works and recreational responsibilities to a third party, which possessed the ability to assess property owners for the administration of these varied services.” UNQUOTE

The facts revealed

You may ask, so what has CAI really done or is this mere words? Based on CAI’s own data in the 2016 LSA survey, with only 94 respondents, readers can see the extent of CAI’s presence in these large scale HOAs — these master planned communities and these active-adult and retirement communities.  Reworking the data, the study revealed that 83.5% use an HOA attorney, which is not surprising for HOAs that can have as many as 9,000 homes or more and revenues that can reach upwards to $20,000,000.

Also not so surprising is that 92.5% of the HOA’s top leaders – president, CAM/COO — are CAI members in a strong case for conflict of interests.  As for senior staff, 64.9% are CAI members, and just 44.7% are on the BOD.  Understand that an HOA can have one or all three categories at the same time.


I ask again, who runs the HOA, and where does the BOD’s advice come from if not from the teachings of the CAI School of HOA Governance? I suspect that the smaller the HOA the lower the percentages using an attorney or having CAI member HOA officials. The money isn’t there! 

This translates into follow the money that focuses legislators, the media, the political scientists, and the constitutional law think tanks on the LSA HOAs, treating the smaller HOAs as local nuisances. This is one good reason for failures in obtaining meaningful HOA reforms and even daily operational reforms.


[1] The foundation and principles of the School can be traced back to CAI’s Public Policies, The CAI Manifesto (its 2016 “white paper”), its numerous seminars and conferences, its Factbooks and surveys, its amicus briefs to the courts, and its advisories, letters, emails, newsletters, blogs etc. I have designated these foundations and principles collectively as the CAI School of HOA Governance.

[2]  Community Next: 2020 and Beyond (May 5, 2016).

[3] Large Scale Associations CAI study, 2016.

CCHAL in Calif. stands up to CAI

The California homeowner activist group, CCHAL, with Marjorie Murray as its president is moving in the right direction.  In its email distribution urging homeowners to contact their representatives to OPPOSE SB 391, CAI is called to task and criticized for its support.

“’The Community Associations Institute (CAI) and the property managers (CACM) are still “stretching the truth’ about SB391 (to put it politely.) CAI and CACM keep publishing ads saying  ‘SB391 gives HOAs the right to hold teleconference meetings during an emergency…’ This is FALSE.”

We need more advocate leaders and homeowners to speak up strongly to force CAI to defend its statements, if they dare, or to shut up!  Silence only helps CAI to increase its stature before legislatures, the media, and the public. Victory is ours by not remaining silent!  

(See If only advocates would stand up to CAI).

CAI knows its defending the indefensible. Do you know that?

HOA Constitutional Government

SB 1454: Machiavelli at work in the AZ legislature – Part 1

Part 1. Rep. Ugenti, Senator Griffin and lobbyist Sandquist 

(See Part 2).

Back in July I commented about SB1454 and wondered whether the Constitution or Machiavelli was alive and well in the Arizona Legislature.  In the subsequent two months I’ve come into possession of additional information on the events surrounding SB 1454 and its predecessor, HB 2371, and the underhanded manner in which it became an unconstitutional law. 

This post elaborates on the above commentary, which should be read first as it provides background information. This post also provides insight on how a legislature really functions, and undoubtedly how your legislature functions with respect to HOA legislation.

Furthermore, for a better understanding of the events the reader should view my video of the HB 2371 hearing before Senator Griffin’s GE committee.  It includes some interesting statements between Rep. Ugenti, who sponsored HB 2371, and Griffin; and between the HOA manager association lobbyist and Griffin. (The lobbyist’s statements begin at 9:13 into the 11 minute video). 

Please pay attention not only to their words, but to their body language as well. Listen to their arguments, but closely examine what is being said “between the lines.”


A.        Representative Ugenti

The March video of Senator Griffin’s hearing shows a perky Ugenti exuding confidence. She makes use of the special interest mantra, “stakeholder,” and states how all the stakeholders met and agreed upon the bill. She basically tells the committee that they are vendors (“stakeholders” refers not to homeowners, but to all those vendors who are making money off the HOA and off the homeowners).  The problem is, is that these vendors are daring to set legislation affecting the rights of homeowners that serve their own agenda.  Yet no committee member asks, “Where are the homeowners?”

Ugenti stated that each year there was “a plethora of personal HOA legislation[1] and tried “to spare the [committee] members the constant agony of many personal pieces of HOA legislation,” as contrasted to the industry legislation. Ugenti also said that she “felt very responsible to the stakeholders.”


B.        Senator Griffin

Senator Griffin is also the Senate President Pro Tempore, second in line in the leadership hierarchy. The AZ Legislative Manual states that, the chief duties of these officers are to preside over Senate and House proceedings and to otherwise assume the duties of the President and the Speaker when they are absent from the Legislature.”  

Griffin played a role in two separate incidents.   The first, see (C) below, is her withdrawal of an amendment to HB 2371, thereby allowing HB2371 to go on the Consent Calendar. This calendar leads to a direct vote by the Floor without further debate by all the representatives. However, it was objected to being on the Consent Calendar, which forced the bill to be debated by the Committee of the Whole (COW).  The bill was never debated and never came to a vote; it died in the Senate.

Second, having faced defeat in her bill Ugenti once again obtained the co-operation of President Pro Tem Griffin. Griffin added the failed HB 2371 HOA amendments to HB 2518 (Rep. Olson was the Sponsor), now before the Senate.  The bill passed the Senate and was sent to the House where a Conference Committee was recommended – the House did not accept the Griffin/Ugenti amendment.  This time, the House failed to hear the amended HB 2518 and it, too, died along with Ugenti’s HB 2371 HOA amendments.[2]

  “The role of morals in politics is mainly to cultivate illusions . . . politics is merely appearance and morality is merely pretense.” (“Machiavelli and America,” Hadley Arkes, p. 104, The Prince (Yale University Press, 1999)).


 C.       Jeff Sandquist, AACM lobbyist

At the end of the above mentioned video (see Part 1), Jeff Sandquist, lobbyist for the Arizona Association of Community Managers (AACM) addressed the committee.  AACM stood to gain much from HB 2371, which would allow its members to represent HOAs in small claims court and before administrative law judges at OAH (Office of Administrative Hearings).  State certified legal document preparers (paralegals) are not allowed this right. There were no provisions in the bill for licensing, training, or educating property managers to adequately represent HOAs. Nor equal representation for homeowners.

Note the very friendly dialogue between Sandquist and the Chair, Griffin, which is out of order for a committee hearing.  “Tell your Mom hello for me.” Griffin mentions that making an amendment got her to see her “buddy” Sandquist.  He thanks her for not offering her amendment.

Sandquist also vaguely spoke about how the courts would like to see a provision moved to another section, implying an acceptance by the courts. It also implies a recognition of a separation of powers issue on granting HOA managers representation rights.

Two days after filing the complaint, about a month after the Governor signed SB 1454, a Supreme Court Rule 31 change was requested seeking an exception for HOA managers to be able to represent HOAs in small claims court (still pending).

[1] I digress. My emphasis reflects, to good extent, homeowners failing to see the broader picture beyond their HOA problem, such as raising substantive issues of constitutionality. Ugenti is saying that homeowners don’t really understand the problems with HOAs, which only the HOA industry special interests can solve. It is evident that this is the view held by all state legislatures across the country. Homeowners have failed to deal with this reality.

[2] In my 13 years I have seen isolated cases in various legislatures in different states where the right and ethical action was taken and legislation was defeated or passed as appropriate, as we see here with these 2 bills.  But, on the whole, far too few.

SB 1454: Machiavelli at work in the AZ legislature – Part 2

Part 2 – UPL violations and “HOAS” in the title.

(See Part 1).

E.         Sanctions against HOA managers violating UPL

In spite of several emails sent to Rep. Ugenti, the Senate GE members, and the public in general there was no mention in the public hearings about the actions taken by the Arizona Supreme Court document preparer board in 2012 regarding the unauthorized practice of law, Supreme Court Rule 31). (See Arizona’s HB 2371 empowers unlicensed HOA property managers to avoid UPL).  I refer to the State Bar UPL Advisory Opinion, 12-01 and the decision holding AAM, a AACM and CAI member, to have repeatedly violated UPL.  (Supreme Court Board of Legal Document Preparers v. AAM, LDP-NFC-09-L094 and LDP-NFC-10-L026). Rather than seek remedial legislation SB1454 and HB 2371 sought to exempt HOA managers from UPL.

The illusion and appearance that all is well and that no stakeholder or legislator was aware of these actions was successful. 


F.         Arizona Capitol Times showing “HOAS” in SB 1454 short title

Finally, the weekly Arizona Capitol Times (ACT) covers goings on at the capitol and produces an online LOLA Report listing the short and long titles of all the bills. Its LOLA shows “HOAS” in the short tile of SB 1454. It states that the info is taken “from Arizona Capitol Reports reporters and records and from state and other databases. Bill-tracking information is updated continuously during legislative sessions.”   But, the official ALIS public access to legislative bill information does not show a short title with “HOAS.”   Who, when, and how was “HOAS” removed from the short title?  And why was it removed?  Surely ACT had no motive to change ALIS to add “HOAS”, and would not dare to do so.

Curiously, the AACM website under Legislative Update shows the same short title as from LOLA, as AACM states that’s where it got the info.  Why wasn’t this called to Ugenti’s attention, or did nobody notice?  Yet, there’s an addendum tacked on to the title, in all caps, “AS SIGNED BY GOVERNOR,” which could only come on June 20th or later with still no correction to reflect the official ALIS version.  Why not?

It has come to my attention that Jeff Sandquist, AACM lobbyist, explained that the state’s position for settling the constitutionality lawsuit was because it wanted to save portions of the bill that it thought was more important.  He seems to be aware that if the court declared the entire bill unconstitutional the initial SB 1454 provisions dealing with Elections would also be invalidated. However, by leaving off “HOAS” in the title the State could argue, if indeed the “plot” was discovered, as it was, that only the second part of Section 13 of the Constitution applied. This would only invalidate the HOA provisions. And so it happened. 

Was this the plan for removing “HOAS”?  Was this the plan for getting Senator Yee’s approval for attaching HB 2371 to her bill, SB 1454?  That her original bill would survive? Recall that Rep. Olson apparently didn’t approve of the Griffin attempt to add HB 2371 to his bill, HB 2518, and it died.

So I argue SB1454 was rushed through in the final hours of the night on the last day of the session, in the midst of attention focused on the budget and Medicare issues. The session ended just before 1:00 AM on the 14th.

“The founders understood that the principal mission of government was to secure people in their natural rights — to protect them against the lawless private thugs as well as of ill-intentioned legislators.” (Machiavelli and America,” Hadley Arkes, p. 145, The Prince (Yale University Press, 1999)).

The arguments and events presented here make a case for a frustrated Rep. Ugenti who, in an act of desperation, intentionally violated the Arizona Constitution and House Rule 16(D).  The Legislature cannot sit idly by and allow a flagrant violation of the Arizona Constitution to go unpunished. It must send a message that such ardent belief in a bill does not allow for the law to be broken and that the end does not justify the means. 

I have urged the Arizona Speaker of the House and House Ethics Committee to bring disciplinary charges against Rep. Ugenti and to seek her expulsion under House Rule 1. Many questions remain unanswered.

CAI reacts to HOA Enlightenment Movement with targeted lobbying of legislators

Apparently, CAI Central in Falls Church, VA is feeling the heat of the Enlightenment Movement — the awakening of the public, the media and state legislators as to what HOA-Land is really all about.  It has sent an email (“You can Enhance CAI’s Advocacy Program by Participating in this Brief Interview,” July 24, 2013) to its faithful members — presumably its “volunteer” members who are for the most part HOA directors — asking for their participation in a survey of their relationships with elected officials.  Obviously, for intense, micro-managed lobbying efforts in support of CAI’s objectives.

By understanding our network of relationships with elected officials, we can build advocacy programs that advance our positions on any number of issues that directly impact our members and the community association industry.

Recall that I wrote that CAI was formed in 1973 to deal with the problems of HOAs as defined and modeled by the 1964 Homes Association Handbook.  In 1992, CAI made a substantial change in its mission and elected to no longer be an educational organization (Tax exempt 501(c)3) and to become a business trade organization (501(c)6).   It did so under mounting pressures and criticisms in articles, research journals, and books, including McKenzie’s Privatopia.  CAI had to reach the legislatures that controlled state laws regarding the HOA industry.

This latest “brief interview” is another attempt to influence legislators in favor of HOA friendly legislation, knowing that advocates are still fragmented.  With the response from the party faithful, CAI will not only know who the friendly legislators are, but what members have good relationships with specific officials.  CAI Central, or through the local state chapter, can then produce targeted emails — as successfully used by Obama in the past election — to influence legislators. The advocates, unless they want to demand copies of all emails, will be in the dark.

This tactic by CAI has ominous consequences for HOA reforms in every state!  It becomes extremely important that advocates and homeowners in every state seeking redress of HOA problems form an advocacy group to inform the public, the media and their legislators of their views.  As I have long argued, advocates must, even more so now, confront, challenge and expose CAI propaganda.  They must also advance quality reform legislation.

This tactic by CAI of addressing legislators in all states makes it a national issue of unfairly influencing state legislators to advance authoritarian private governments not subject to the US Constitution.  Homeowner rights advocacy groups must be given equal access to their legislators!  Advocates must be given equal bargaining powers over HOA issues!  Legislative committees must not be allowed to hear that the “stakeholders” met without hearing from an advocacy group!

Links to representative CAI “interview” questions: CAI-network3, CAI- network 4, CAI- network 5, and CAI-network6.


See What is this “association law” thing all about? and The questionable role of HOA attorneys.