Homeowners Associations

It's strange how "scandal" gets defined these days in Washington. At the moment, everyone is screaming about the "scandal" of the Internal Revenue Service scrutinizing conservative nonprofits before granting them tax-exempt status. Here are the genuine scandals in this affair: Political organizations are being allowed to masquerade as charities to avoid taxes and keep their donors secret, and the IRS has allowed them to do this for years. The bottom line first: The IRS hasn't done nearly enough over the years to rein in the subversion of the tax law by political groups claiming a tax exemption that is not legally permitted for campaign activity.

Question: Even with an annual income of more than $2 million, our association is in a big mess. There's a several-million-dollar loan inclusive of our reserve account the association is paying off that has a variable interest rate currently at 6.85%. The association can't touch the reserves because the bank says it's garnisheed as collateral for the loan. The board says we have to pay this money back because the bank is holding our reserve account hostage. If it is borrowed and we can't touch this high-interest money, can the association just give it back?

Re "Homeowners Groups a Love-Hate Affair" (Sept. 19): I read your informative article with great interest. Members of the board run for election often unopposed. Most residents are apathetic and do not attend meetings unless they have a personal agenda. More often than not, the directors are untalented. In our case, our reserves are too low (28%) and maintenance is less than minimum. We have unchecked termite infestation and many of our roofs leak. When I questioned our reserves, insurance and code violations, I was booed and denounced as a troublemaker.

Question: My homeowner association board acts with impunity because, the members say, they "can. " The reason the board gave me for its untenable actions was that "a person serving on an HOA board cannot be sued. " Is that so? Answer: There is no law in California that prevents an association's board of directors, the association or even its employees and vendors from being sued in any court. Whether or not such lawsuits are justified is decided by the court. The board cannot act with impunity merely because members believe they "can," and efforts to do so usually result in the board's removal or a lawsuit.

Question: I'm an owner and board director for my homeowners association of less than 25 units. For four years our association has been fighting ? to the tune of thousands of dollars per month in attorney fees ? over ongoing nonsense. Although it's wise to have association documents kept up to date, I didn't intend to spend four years of my life copying documents and meeting with lawyers. I believe that small associations like ours should be able to opt out of complying with California's Davis-Stirling Act. The legislature just seems to keep making these laws more complicated, time-consuming and expensive to comply with.

Question: I live in a town house with a tennis court. Children also live here and use the courts to run around in and underneath the nets, treating it as a playground. These children do not play tennis and they are not accompanied by adults. I complained to the board but was informed there is a new California law that prohibits discrimination against children. I am not discriminating against them, I just don't want damage done to the court or complex, whether caused by an adult or a child.

A new homeowner association in Boyle Heights elected officers Saturday, making it one of the first residents groups on the Eastside. The Boyle Heights Resident Homeowners Assn. began meeting about two months ago to participate in decisions about the neighborhood. About 60 families have joined, and organizers said they hope to involve hundreds of people.

A four-year dispute over tall trees and blocked ocean views has escalated into a mini-war in an affluent neighborhood here after 200 eucalyptus trees were abruptly cut down this week by the local homeowners association. Sheriff's deputies responded Tuesday and Wednesday to reports of unrest in the 151-home Potomac Landing community, where tree crews say they were threatened with a shotgun, shoves were exchanged, and members of the Potomac Landing Homeowners Assn.

Prompted by reports of families losing their homes over as little as $120 in unpaid fees, a state Senate committee on Tuesday began hearing testimony on alleged foreclosure abuses by homeowners associations. The private neighborhood groups regulate everything from how homeowners paint their houses to what ornaments they put on their front lawns.

For 14 years, Sam Dolnick owned a home in a Chicago suburb. He cleaned the rain gutters, mowed the lawn and fixed the plumbing. For the past 16 years, Dolnick has lived in a condominium in the San Diego suburb of La Mesa. He leaves the lawn, the roof and the routine maintenance to professionals. "I love taking walks around the complex and looking at the green space and realizing I don't have to mow all that grass," the 75-year-old retired educator said. "It's a great way to live."

Question: I recently was elected to the board of directors of my homeowners association. I was surprised to learn that rather than conducting board meetings with an agenda and homeowner attendance and calling executive sessions, the board regularly makes decisions via email — not an Internet conference, but simply emails. The manager initiates emails to all board directors with an issue or question and requests a majority decision. As soon as she obtains one, she acts on it. It's unclear whether all directors even read all the emails.

Question: What happens if no one runs for the board and we can't get anyone to serve? Does the state take over? Who if anyone puts us in receivership? How do those actions affect all of us titleholders? Answer: Although common interest developments are state-created entities in law, the state has no interest in taking over their operations. There is no state agency that would initiate a "takeover" of a privately owned common interest development with a homeowners association. When there are no directors to serve on the board, there may be two alternatives.

Question: I own a town home in an association that has a couple of hundred unit owners. We have a current liability of more than $1.3 million but only $180,000 in the actual reserve account. At the last meeting, the board handed out an article stating that associations are not required to have reserve accounts. Board members used this as proof that we did not need to fund the association's existing reserve account or have a reserve. Our CC&Rs, however, state that we must have a reserve account.

A Kentucky doctor accused of shooting and killing one person and seriously injured another during a homeowners association meeting in Louisville pleaded not guilty Saturday. Mahmoud Hindi awalked into the meeting at a local church late Thursday and stayed for a short while before he pulled out a gun and began shooting, police said. Hindi tried to leave but was stopped by two people in the room, Louisville Metro Police Lt. Barry Wilkerson said at a news conference Friday, which was posted online by the Courier-Journal.

Question: There are five directors on our homeowners association board. If the vote on an item is two yes, two no and one abstention, what is the outcome: yes or no? Answer: Yes or no? Neither. The matter is unresolved because it did not receive a majority of votes. Tie votes prevent a board from taking any action on the motion. Glassman is an attorney specializing in corporate and business law. Vanitzian is an arbitrator and mediator. Send questions to P.O. Box 10490, Marina del Rey, CA 90295 or email noexit@mindspring.com .

WASHINGTON — Thousands of condominium owners and buyers around the country could soon be in line for some welcome news on mortgage financing: Though officials are mum on specifics, the Federal Housing Administration is readying changes to its controversial condominium rules that have rendered large numbers of units ineligible for the agency's low-down-payment insured mortgages. The revisions could remove at least some of the obstacles that have dissuaded condominium homeowner association boards from seeking FHA approval or recertification of their buildings for FHA loans in the last 18 months.

When police found 78-year-old Lucy DeAbreu in her Dana Point condominium, her face had been pummeled so badly that she couldn't speak clearly. The petite widow had to slowly spell the name of her attacker: M-I-N-E-O. Charles Mineo and DeAbreu were neighbors in a tidy ocean-view complex favored by retirees and weekend sojourners. Mineo, a 47-year-old accountant, was angry at his homeowners association because it had penalized him for an unauthorized addition to his unit.

Question: Shortly after I bought my town home I had to rent it out and move in with my mother because she could no longer live alone. Since I became an owner I've never been late paying my homeowner dues, and my unit is well maintained. Every year the association sends me requests for nominees to serve on the board. I have volunteered my name numerous times and have experience in property management and believe I could contribute valuable service to my community by serving on the board.

Question: My homeowner association board of directors keeps owners in the dark and treats its actions and duties as if they were secrets to be kept from owners. I keep asking my board for documents, and the directors act as if they don't know what I'm talking about. I'm losing patience with their game-playing in avoiding circulating very important documents. As an owner, what should I be asking for? Answer: As an owner in a common interest development you are entitled to obtain certain documents.