HOAS are Big Business


Submitted as a Commentary to the Arizona Capitol Times

Apr 24, 2001



It has been just about a year since ex-Senator Tom Freestone was able to get the legislature to  create the HOA Interim Study Committee that met from August to  December of 2000. The mission of the committee included To (1) review the effectiveness of current homeowner association laws in ensuring the rights of homeowners are protected; (3) examine the role of management companies hired by homeowner associations."

I feel the committee had failed to effectively to meet items (1) and (3) relating to protecting the rights of homeowners and investigating the practices of management companies, respectively. As for item (3), the committee never called any of the management companies to answer for the charges made against them by the homeowners and therefore, could not come to any unbiased conclusion.

Pat Haruff, HOA committee member and homeowner representative, writes, “The most frustrating part of the legislative process is that ‘Joe Citizen’ is really NOT a ‘part’ of the process … In the final analysis the ONLY persons who have ready access and plenty of contact with YOUR representative are the Lobbyists for the many Special Interests.”

To place these issues in proper context let me say that the intrinsic legal structure of the HOA is defective and that the problems with HOAs are not the grumbling of a “disgruntled minority”. It’s a nationwide problem and Arizona had an opportunity to do the right thing and failed. Shu Bartholomew, host and producer of On The Commons, uses the slogan “You are now leaving the American Zone” to call attention to the private government nature of these nonprofit corporations, with their denials of the civil liberties  that Americans are entitled to.  There have been Supreme Court cases in other states that decided that certain acts by HOAs are “an unconstitutional delegation of government powers”. Yet, homeowners are still being held to a so-called private contract arrangement between HOA and the homeowner that is arguably voidable for 2 reasons: it denies homeowners their civil liberties and there has not been a true “meeting of the minds” with a full disclosure of what living in an HOA really means.

What the legislators and the public are not being told by the special interest management firms, lead by the leading trade group, CAI, that, as Ms Bartholomew states, “Property values and the quality of their lives are subject to the whims of their neighbors and the honesty or lack thereof of management”. As Rick Happ from North Carolina Property Rights says, Even a well directed HOA is "one election away" from tyranny … The HOA problem is a national problem that needs to be addressed on a Federal level.”

“Why”, I ask, “have the Arizona legislators failed to see these basic violations of the American way of government and fair-play?”  Because HOAs are big business! CAI, the special interest lobbying trade group, vigorously attacked homeowners seeking to call attention to these problems in the HOA committee, in the legislature and in the media. And the legislators sat silent and wouldn’t even remove this impediment to the redress of grievances from the HOA committee. Cities and towns get infrastructure paid for by developers rather than having to raise taxes to pay for expansion, creating these private governments that denial civil liberties. This is the extent that special interests have spread their myths about HOAs,  permitting government officials at all levels to look the other way.

HOAs are big business

George K. Staropoli, Pres.

Citizens Against private Government HOAs