HOAs Fall Off Politicians’ Radar in Times of Election

Elections are just around the corner, meaning it’s all about politics this year. More to the point, it’s all about Republicans and Democrats. This is the season of the candidates, the issues, and the Parties. We hear everything about illegal immigration, the economy, and the war. But what about HOAs, which house millions of Americans? Why aren’t community associations represented?

How can we possibly say that HOAs are ever “off politicians’ radar?” In 2014 alone, ECHO worked on a dozen bills that would have directly regulated association operations. And this tired story has repeated for decades: every year we see a similar number of bills aimed at reforming HOA practices.

But don’t scoff yet – a quick glance at the 2014 crop of legislation reveals a common thread:

• AB 1738 – regulating dispute resolution
• AB 2100 – regulating landscaping fines during the drought
• AB 2188 – regulating wait times for solar energy permit applications
• AB 2561 – regulating the scope of landscaping rules
• And more…

Nearly every HOA bill in Sacramento focuses squarely on the relationship between owners and their boards. Because that’s how politicians see homeowners associations: contentious communities where each side attempts to take advantage of the other. While these pitched intra-association power battles are real (although far from pervasive), what about the BIG PROBLEMS like rampant underfunding, uninformed owners and boards, decaying infrastructure, and constant litigation?

20% of people in the United States live in common interest developments (CIDs). But as a voting block, they might as well be invisible. Politicians occasionally try to regulate abuses of power, but shy away from fixing a system that fosters financial vulnerability in our communities. Unfortunately, whenever CIDs do get noticed, the statutory results are familiar and often unwelcome.

Tyler Berding, an association attorney with the law firm Berding | Weil and a frequent speaker and writer for ECHO, wrote about this problem a few years ago. He argues that California politicians need to focus on association problems at every level, and use the law both to regulate internal disputes and fix systemic problems.

Why Are Community Associations Underrepresented on Party Platforms? 

Tyler Berding, J.D., Ph. D.

Elections are just around the corner, meaning it’s all about politics this year. More to the point, it’s all about Republicans and Democrats. This is the season of the candidates, the issues, and the Parties. We hear everything about illegal immigration, the economy, and the war. The two political parties and their nominees for public offices everywhere are consumed with new and old answers to such social and economic issues as universal health care, housing, and interest rates. This is business as usual in an election year.

However, if you listen to all of the speeches, read all of the political flyers, hear all of the endorsements, you will still hear nary a word about community associations, which house millions of Americans. “Who cares?” you say, “Elections are about important national and state issues, not about something as mundane as my homeowners association.” While that may be true at the national level where the debate about our country’s future rages over problems that often seem unsolvable, what about at the state and local levels? What about the candidates for city council, the state legislature, or governor?

At the state level, housing and real estate law and land use should carry a great deal of weight with politicians, and HOAs are all about those issues. Where should we build new developments? How do we make them green? How do we govern those that already exist? How do we make them affordable? What do we do with the projects that have reached the end of their useful lives? These are issues which can and will have an enormous impact on any state’s housing stock, its economy, and its future.

Yet we hear almost nothing about this huge constituency from any politician. “Is it that big a deal?” you may ask. Well how about this: as of this year there are over 300,000 HOA governed communities in the United States, and they are home to almost sixty million residents! That’s somewhere around 20% of the entire population of this country living in community associations. Yes, it’s a big deal.

So what do all of these real estate interests need from our elected officials? Well first of all, they need understanding. An understanding of the importance of this type of housing to the entire nation. An understanding of the unique nature of its governance. An understanding of the potential economic disasters that will occur if these communities can no longer self-govern or maintain their facilities. After that, we need carefully drafted legislation that recognizes these concerns and looks to the long-term survival of this type of housing.

HOA Problems that Need Addressing

Current law in most states does not provide meaningful support or even a legal context for the community that can no longer raise the funds necessary to maintain the project, can no longer recruit volunteers to serve on boards of directors, or has reached the end of its useful life. In most states there is no statutory recognition of this problem whatsoever. In California there is an ongoing attempt* to revise the existing statutory framework governing common interest developments, but a viable end strategy for failed communities has not yet found its way into the proposed revisions.

It is apparent that many political candidates are largely unaware of important community association issues. Even less interest is shown by the major political parties. Maybe that’s because what makes good community association government does not lend itself to a Republican or Democratic platform. Is that because the preservation and support of common interest communities has no political ring to it?

That’s not true, of course. Community associations resound with debates over less government versus more government, similar to the rhetoric among political parties. Should boards more aggressively enforce the CC&Rs or should they adopt a “hands off” point of view? Should an individual’s freedom to build what she wants, to choose the color he wants, or to park whatever vehicles on their lot that they want, be curtailed by written rules? Should the board be able to adopt a prudent economic policy by raising assessments as necessary to assure sufficient funds for future maintenance, or should they have to accept the political reality that the owners do not want to pay higher taxes? Are there constitutional questions here? Individual rights vs. the needs of the community?

These issues emulate the national political debate. At the local level, however, they are largely non-partisan. But nevertheless, they should be the focus of state regulators, and politicians owe it to condominium and planned development owners everywhere to focus their radar on the potential consequences of failed budgets or failed community association government. These issues involve such a sizable chunk of the population that politicians at the state level, where real property law and policy is decided, must be aware of these issues so at least they will be prepared to evaluate any proposed legislative changes to the law governing associations. 

It’s time for community association issues to receive more political attention. We’ve experienced foreclosure crises, earthquakes and droughts, each of which significantly affect the homeowners of California. Resolving the issues left by the impacts of these crises takes political guts at all levels, starting with your boards of directors and leading to our elected officials.

*[Editor’s Note: This revision, known as The New Davis-Stirling Act, was completed in 2012 and implemented in 2014. The final version reorganized and simplified the existing statutes, but did not substantially change California association law or practices.]