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Homeowners
Associations: Dictatorship or Democracy?

Published 1314 days ago, 3 Comments
  • Darcy Spears

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If you’ve ever found yourself going up against an HOA board, then you already know the answer and the unending headache that comes along with the torment. So what do you when you feel hopeless in your own home? Contact 13 shares their stories of exposing the best of the worst in the HOA Hall of Shame.

By Darcy Spears

There are somewhere around 2,000-3,000 of them acrgmaoss the state. They’ve been called the closest government to the people. Whether you think yours is a dictatorship or a democracy, you probably live in one if you’re like most Nevadans.

They’re homeowners associations.

To some, that’s a bad word. A scar on our society that restricts personal freedom by telling us what we can and cannot do with our own homes … our sanctuaries. If a man’s home is his castle, then why should there be another ruler?

To answer that, we have to look at why HOAs were conceived. Their intent was to take over from developers to manage communities with common areas and amenities like gates, pools and parks. They would have control of private streets, make and enforce rules of conduct and help keep up property values and standards of living. Sounds good in concept, but it’s hard to ignore the reality that unfortunately seems to have developed over time.

Sen. Mike Schneider, who crafted NRS 116 the original HOA law, says, “I think we have a real problem on our hands—a societal problem—with these HOAs.”

By the sheer number of HOA-related bills coming before the legislature this year, Schneider says, “You can tell that the problem is just permeating out there through the whole community, the whole state.”

Because HOAs are governments, Schneider believes they need to be more focused on giving people due process. But he doesn’t believe that’s happening enough of the time with bully boards, excessive fines and kangaroo courts in some HOAs.

“Instead of trying to build a community and we’re all in this together and let’s try to help each other out, it’s us against them.”

When Communities Go From Neighborhoods To Battlegrounds: Contact 13’s Hoa Hall Of Shame

When Deena Trueblood and her teenage son had lived without water for a month, the single mother decided enough was enough. She wrote a letter to Contact 13 describing the extreme action her homeowner association had taken against her (shutting off her water two weeks before Christmas over a fee dispute) and pleading for help.

“It’s the most debilitating thing that you can do to a homeowner,” Trueblood said. “You can live without TV, you can live without phones, you can live without even power if you have to, but you can’t live without water!”

We inducted her association, Tara Villas, into our HOA Hall of Shame.

Bruce Flammey, an attorney who usually works for HOA boards, couldn’t believe what Tara Villas did.

“In what world could this possibly have made sense to anybody?! How could this possibly be the right answer?”

When we went looking for answers, and the board’s side of the story, from Tara Villas President Stan Simcizen, he slammed the door in our faces and yelled at us. He called the police on us too—and when we told the officers what the HOA had done, even they couldn’t believe the inhumanity.

Bottom line, after depriving Deena of water for an entire month, the HOA turned it back on just three days after our story aired.

Another problem area in HOAs that we hear about all the time is parking. The Southern Highlands community of Ansedonia contracted with a parking enforcement company called Boot-It that was cruising the neighborhood, placing boots on residents’ cars (some of which were parked in their own driveways) and demanding cash to remove the boots. Boot-It was eventually booted from the community, but not before multiple residents shelled out hundreds of dollars each to free their cars.

Then there’s the Autumn Chase HOA in North Las Vegas run by the man on whom we bestowed the title of President of the HOA Hall of Shame, Joseph Bitsky. This colorful character is a man who some residents say embodies everything wrong with HOAs and those who run for HOA boards. When I interviewed him about residents’ concerns, he yelled at me, insulted my intelligence, called me a jerk and even stuck his tongue out at me on camera.

Shortly after our story aired, he resigned as board president and is now facing criminal charges in North Las Vegas for coercion after preventing homeowners from leaving a meeting at his house when he found out they were recording it. Recording HOA meetings, by the way, is required by law … but all that will be hashed out in court.

And of course, we can’t forget the curious case of Doris “Penny” Vescio whose story put Sun City Anthem into our Hall of Shame. The SCA board approved her backyard fence after a coyote nearly killed her dog in her own backyard, but reneged on the deal eight months later. They started fining her $100 a week and ordered her to take down the $3,000 fence that all her neighbors approved of.

After our story, the board granted Penny a stay of execution of sorts, agreeing to waive the fines and let Penny keep the fence, but only for two years. At that point she’ll have to take it down or face new fines. I asked her attorney, Bob Sullivan, “Why do you think they’re sticking to their guns so strongly in this case?” His response is exemplary of what’s wrong with the power structure inherent in HOAs.

“I think it’s an issue of one person’s personality dominating and placing others in fear on the board and on the subcommittees,” Sullivan said. “They’re more focused on their own egos and looking good and less concerned with the good of the community and the safety of homeowners.”

While by no means are all or even the majority of, HOAs “bad,” if that’s the term you’d choose, those that are can have such a devastating impact on a homeowner’s life that we were inspired to call them out. We hope our Hall of Shame literally shames the wrong-doers into becoming do-gooders.

“The boards, in many cases, that don’t have a lot of knowledge about how to run a business let alone how to run a community and a government, they set themselves up as dictators,” says Sen. Schneider.

There is some good that’s come out of all the negative publicity.

Some Industry Perspective

Recently we learned of one HOA board that is taking the time to learn about their responsibilities and obligations. All seven members of the Sun City Aliante HOA board of directors have taken the time to obtain the Dedicated Community Association Leader certification. They are the first board in the entire state in which all members of the HOA board of directors have received this certification, indicating that they are taking their responsibility seriously and taking the time to learn how to do it right.

Pat Taylor, president of Nevada Chapter of Community Associations Institute, which is an HOA industry group, says, “Our goal is to educate the board members, homeowners, volunteer leaders and people in our industry as to the proper and legal way to do things. And there are a small percentage of folks who don’t choose to do it that way. And we don’t endorse that. That’s not what we stand for. But there are a larger percentage of boards, management companies and managers that are doing the right thing. We never hear about them. We just hear about the small percentage. Is there room for change? Absolutely. And we look forward to that and we applaud that.”

Collections Cash Cow

Perhaps the biggest change homeowners would like to see comes in the area of collections. HOA boards often hire collection agencies to pursue overdue assessments and fines, but there’s no cap on their fees. So a homeowner who owes $90 could wind up with a bill for $2,600 once a collection agency gets involved.

Barbara Holland, who owns a property management company and regularly writes a newspaper column on HOA issues, says, “Many of the management companies and boards of directors are absolutely going out of their way; working with homeowners that are trying to keep their homes and coming up with some sort of intelligent payment plan during this time period,” referring to the downturn in the economy. But those who don’t have created what some call a collections catastrophe which unfairly penalizes homeowners while creating a windfall for those doing the collecting. That too, is part of what the legislature is considering changing.

Foreclosures, Short Sales and Home Sales, Oh My!

There’s fallout from the collections agency involvement and the fines associated with homes that can affect neighbors who have done nothing wrong and have nothing to do with properties that are being sold.

Realtors tell me in this economy, when they’re trying to short-sell homes that have been abandoned or people can no longer afford, they’re often faced with trying to reason with HOAs to waive fines and fees that have been accumulating. Banks won’t approve short sales if there is a lien on the home. But instead of agreeing to forgive and forget, they tell us some HOAs won’t budge. The result? Homes that could have sold and brought in new owners, who would clean up the property and start paying dues again, are forced into foreclosure. That can, and realtors say often does, drive property values down for the entire community.

Rights and Recourse

“What’s wrong with HOAs?” I asked attorney Bob Sullivan.

“Well, they’re not really kept in check. There’s no real mechanism in place for homeowners to rebalance the power. Right now there’s a very steep power imbalance that favors the HOAs.”

He’s talking about a state law that makes arbitration mandatory before a homeowner can take a case to court. And you have only 30 days to file a formal appeal in District Court. In the arbitration process, the Nevada Real Estate Division’s own statistics show the homeowner loses over 80 percent of the time.

Some might argue that the homeowner is wrong that often, but Sullivan and many others fighting to change the system say it’s for another reason entirely.

“Arbitrators routinely award attorneys fees from $10,000 up to $70,000 against a homeowner. And these are for very minor and generally very simple issues that could have been resolved,” Sullivan explains. “The arbitrators receive their repeat business from the HOAs and the HOA attorneys. They do not receive their repeat business from the homeowner. So if an arbitrator develops a reputation for being homeowner-friendly, or even neutral, in my opinion, their names will be stricken in favor of somebody who’s more favorable to the HOA.”

But for now, at least, that’s the system homeowners seeking redress have. The only path to justice for homeowners with grievances they can’t resolve with their boards is to start by filing a formal complaint with the Real Estate Division’s Office of the Ombudsman for Common-Interest Communities. The problem there is the office was established with limited jurisdiction and often can’t intervene—leaving homeowners battling their board through the above-described arbitration process, and possibly court, if they’ve got the stamina and the money to stick with it.

“I’m tired of the bully boards. And I want HOA boards to start treating people like human beings and stop pushing them around,” says Rana Goodman, a Sun City Anthem homeowner who attended a rally recently at the Grant Sawyer building.

The bottom line here is that everyone wants to be able to play nicely together in the sandbox. We’re taught to do so as children, but we often forget that as adults, when a little bit of power comes into play. If HOAs were abolished, would people who previously took pride in their homes suddenly start painting them purple and letting weeds grow thigh-high? Probably not, but there is the need for someone to take care of common areas and streets, so we’re in a situation where we need our HOAs. We just need them to be livable communities where no one’s throwing sand. 

Darcy Spears

Contact 13 Chief Investigative Reporter Darcy Spears is the voice for Las Vegas residents when it comes to HOAs. Her Contact 13 segment, “HOA Hall of Shame” calls out the offending HOAs and brings a bit of justice to the residential community. She’s been investigating Las Vegas for 15 years and her stories have changed lives, laws and taught lessons to those who would do wrong. To view past segments, log onto ktnv.com.

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  1. Joyce LaValleyJune 15, 2011, 8:52 am

    We have a HOA here, and when you bring up the rules (which the wrote) the president who does not own property always says that he okayed it. We have dogs that we should not have, like shephers, pitbulls, pincheres, but because he also works for the owner who’s renting out apartments until he can sell them we have to tolerate this. He’s also trying to pit the owners against one another, other wise he likes to use extortion of some sort. Thanks for letting me blow off steam. I’m sorry that I bought a condo, and in this state I won’t do it again.

    Reply
    • Sara AguinagaAugust 27, 2012, 5:19 pm

      Our HOA has been in litagation since 2005 with developer over defective plumbing fittings, just recently settled.
      July 28,12, my bedroom was flooded due to a fitting that broke. Their contractors cut a portion of my bedroom wall out,
      along with a section in the water tank closet. They pulled up my carpet and cut out most of the padding, and here we sit.
      My bedroom is now in my small diningroom. HOA = pass the buck. Calls to HOA are useless, I’m told to make all contacts with their attorney’s office. Attorney’s response is when and IF the 3 Board members approve repairs I will be notified. No
      one will even give me enough respect as to tell me why the delay! I have been forced to contact my attorney. My fault for not researching HOA’s before our move here. The board members are also neighbors, and and these women obviously enjoy their power, and probably have no trouble sleeping at night. If this should happen to one of them, will be interesting to watch how fast the process of repairs are made. Thank you for letting me vent

      Reply
  2. Nila RidingsSeptember 7, 2013, 9:03 pm

    HOA nightmares don’t just exist in Nevada.

    I’ve been studying HOAs for six years. I’ve lived in one for eight. Never again!

    We have one here in Kansas where a board member, a former administrative judge, beat a homeowner with a crowbar! That case is in federal court now and should go to trial in the Fall of 2013.

    My HOA board has demonstrated very nicely the downsize of dishonest board members. They love filing lawsuits against homeowners when they are in breach of contract themselves. Results: over 20% rentals, foreclosures, a million dollar loan, insurance has been canceled once, countless lawsuits, property values that have dropped by 40% since 2005 and dues that have increased by 40%. No hope in sight. Plus, we have TEN MILLION dollars unaccounted for thanks to the guy that was the board president for 26 years. He died as soon as some of us starting an investigation! At the time of his death he had purchased two places in California and was running for the board out there. His replacement convinced the board t hire a property manager at 400K per year. They were caught doing wood rot repairs on the siding of our homes but it was so severe due to failed maintenance that the frames on the homes were rotten . The told employees to cover the rotten frames up and not tell the homeowners! Lucky us…one of their employees resigned and became a whistle blower. This nightmare goes on and on .

    Bottom line, I learned about the best book ever on homeowners associations. “Neighbors At War!” by Ward Lucas. He has a website as well, http://www.neighborsatwar.com

    There are limited few stories in the media compared to what is truly going on out there in HOA America.

    Thank you to Darcy Spears for doing her part to expose the corruption, deceit, and nightmares that lurk in this horrible communities.

    Reply

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