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Seeking to protect homeowners

As of January 2008 there were 2,942 homeowner associations in the state. One million people live within these associations. We were complete strangers until disputes with our respective homeowner association boards brought us together. Both of us had run into differing problems, but soon realized that a strong advocacy group was needed.

Out of our battles was born www.hoadvocates.com. This Web site has been created to bring homeowners together to fight for the restoration of homeowner rights and allow people to know what changes are being made to HOA laws.

The Web site gives members easy access to their legislators. This will give lawmakers input on how homeowners feel about proposed changes in the laws and help homeowners protect their rights by having an organization that helps them seek unity in numbers. It is the people who change laws — and, yes, it’s time for change.

Associations are governed by a state statute (NRS 116), enacted in 1991, that is supposed to protect homeowners. But just the opposite has taken place. Over the years, this statute has been modified to give more and more powers to association board members at the expense of homeowners.

Another provision in NRS 116 established the office of the ombudsman. The intent was to resolve problems and prevent runaway board abuses.

It has turned out to be a farce and window dressing. The ombudsman’s office has been told by the attorney general’s office that it has no power to intervene in disputes between homeowners and their association boards concerning governing document disputes. So much for that protection.

At the conclusion of the 2007 Legislative session, the governor vetoed Assembly Bill 396, which would have given boards unprecedented powers to enact special assessments without the approval of homeowners. It also would have required full funding of reserves and allowed boards to operate in a vacuum, shutting out homeowner input or approvals on budgets.

At present there are 10 bills pending before the Legislature dealing with homeowner associations. Assemblyman Harvey Munford, D-Las Vegas has introduced one of special interest. This bill — entitled The Homeowners Bill of Rights — would help stop the abuses against homeowners and the fines being levied against individuals for petty infractions.

Thousands of hard-working homeowners have been threatened and have had to pay fines to their overzealous boards for minor infractions. The alternative is to retain an attorney to fight these boards, which can be more costly than paying a fine.

What is needed is an organization that will have the clout, muscle and financial strength to get the laws changed removing excessive powers from homeowner boards.

Last year, one of us brought an arbitration suit against his board for enacting a special assessment to fund the reserve account at Rancho Bel Air without a vote of the residents. After an expensive legal battle Mr. Friedrich prevailed. His board spent more than $41,000 in legal fees.

Currently there are battles raging in both Sun City Summerlin and Anthem between boards and individual board members. In these communities, the issues revolve around lack of transparency by a majority of the board members, and millions of dollars in lost revenues thanks to the lack of business plans covering the operations of golf courses and clubhouses.

Poor bookkeeping and the failure to require the developer to provide the reserves as required are just a few of the problems at these communities.

Sun City Summerlin was hit with a federal lawsuit filed by Robert Hall, a resident, for imposing a special assessment without a vote of the homeowners as required by that communities CC&Rs.

In many cases the personal agendas of board members take precedence over individuals rights. Abuses continue unabated by runaway boards.

Of recent interest is the FBI probing into possible collusion between association attorneys, contractors and board members. This case has broadened, as more and more unhappy homeowners have come forward. Supervisory Special Agent Richard Beasly of the FBI is heading up the investigation.

The possibilities of elected officials using taxpayer funds to substantiate boards’ positions are being looked into.

In February of 2009 the Legislature will be in session. High on the agenda will be changes to homeowner association laws. The resurrection of vetoed AB396 will be near the top of the list for the Legislature to consider.

Behind the scenes is the Community Associations Institute a powerful national organization, which has and will continue to lobby legislators to give more powers to association boards and to enrich attorneys representing these boards, all at the expense of homeowners.

The residents of Nevada need a strong and powerful voice in the Legislature to represent individual homeowners. The launch of www.hoadvocates.com is a start.


Ian Dixon and Jonathan Friedrich are Las Vegas residents.

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