Tag: California

CA’s condo-mania: AB 1033 allows ADUs to be 2-person condos

A very disturbing 19-page California bill, AB 1033 (Ch. 752)[1], became law this week that extends HOA-Land with respect to Accessory Dwelling Units (ADU)[2]. The rationale seems to be to support low-income housing given the scarcity of California,  and gain income for retired people as well. It allows the property owner to have a livable unit (ADU) on his property  but requires  the owner to form a two-person condo on what was his single-family property. The accessory unit can then be sold as a condo unit subject to the Davis-Stirling condo laws. Why, I ask???

In order to make this plan work a complicated series of amendments were added. In other words, a planning board, for instance, is given authority to allow this approach to housing, along with changes to building requirements, codes, etc.

The Legislative Digest states,

“This bill would, in addition, authorize a local agency to adopt a local ordinance to allow the separate conveyance of the primary dwelling unit and accessory dwelling unit or units as condominiums, as specified, and would make conforming changes. By imposing new duties on local governments with respect to the approval of accessory dwelling units, the bill would impose a state-mandated local program.”

To me, this seems  like a lot of about nothing, unnecessarily complicating property rights and housing.    BUT, extending the fragmented HOA-Land and further eroding adherence to the Constitution – more individual rulers functioning outside the Constitution. It goes beyond home rule laws and the medieval fiefdoms.[3] There is no oath  of allegiance to support the Constitution as the supreme law of the land. And condos pay minimal taxes as a non-profit.  So, what’s the story??

To paraphrase Jack and the Beanstalk, “Fee-fi-fo-fum, I smell the blood of a CAI man.”  CAI-CLAC is the very powerful and highly active CAI legislative action committee (LAC) representing all CAI California chapters. And then there’s Echo,[4] whose membership structure duplicates the  CAI membership structure.

Who says CAI is not a coercive monopoly?[5] Take a close look at California again. Are their any voices in support of homeowners to compete with CAI?  No, sorry to say, although one group has had some influence on legislation but it does not stand close to the overall impact of CAI on events concerning HOA-Land.

NOTES

[1] Bill Text – AB-1033 California Family Rights Act: parent-in-law: small employer family leave mediation: pilot program.

[2] ADUs come in all shapes and sizes – for example, a converted garage, a small home in the backyard, or, as often seen in San Francisco, an unused portion of the main house.

[3] A fief was a central element in medieval contracts based on feudal law. It consisted of a form of property holding or other rights granted by an overlord to a vassal, who held it in fealty (oath to the lord) or “in fee” in return for a form of feudal allegiance, services, and/or payments. 

[4]  “Educational Community for Homeowners (Echo) is a nonprofit corporation dedicated to assisting California homeowners associations. Members receive guidance through live webinars, Members receive guidance through live webinars, virtual seminars and workshops.

[5] Is CAI a coercive monopoly? Definitely YES!

Law review on CC&Rs constitutionality – part 1

While the title of the Ken Stahl Pepperdine Law Review article[1] addresses the “validity of private deed restrictions” (CC&Rs) and “an unconstitutional taking” (eminent domain) with respect to affordable housing, Stahl’s investigation covers many of the HOA constitutionality concerns that I’ve raised over the years. He warns about legislative “overrides” – statutes that impinge on CC&Rs – and the balance of governmental powers between the state/county and private, contractual governments.

While the article is focused on California’s dealing with its affordable housing crisis, my annotations are questions focusing on the constitutionality of the  HOA CC&Rs. The article covers a lot of ground – 55 pages of legalese — and so I will make several commentaries or, in this case, research memoranda. Starting at the beginning, the Abstract and Introduction materials, Professor Stahl speaks to:

  • California legislature invalidating CC&Rs. We  are aware of statutes regulating what HOAs can and cannot do on things like “pets, clotheslines,  signs and flags” but the legislature is going a bit further in regard to local zoning, home rule statutes, and “overriding” many covenants in the interest of affordable housing. 
  • “The doctrine of “home rule” that places some outer limits on the ability of state legislatures to preempt local regulatory power.”
  • Home rule statutes exist in all states that allow a high degree of community independence from state/legislative interference on local matters.  The HOA scheme avoided these statutes that would provide all the current benefits but subject the HOA to the Constitution – HOA could not hide behind “not us, we are private” nonsense.
  • This overriding is facing concerns of the state “taking” of property rights that HOA members agreed to under a private contract. This invokes eminent domain concerns of just compensation as I have raised with respect to the questionable HOA contract’s taking of a member’s property rights.
  • All fifty states have detailed legislation regarding the governance and management of HOAs, including voting rules, budgeting, disclosure, and so forth, and a few states authorize state agencies to regulate HOAs.
  • “HOAs are ubiquitous, vastly outnumbering local governments, and they act essentially as little municipalities, taxing residents through mandatory assessments and regulating land use with detailed restrictions, called “covenants, conditions, and restrictions” (CCRs), that often mirror local land use regulations. Indeed, CCRs are typically far more restrictive than local land use regulations in many respects.”  There you have it, almost like McKenzie’s words in his 1994 Privatopia [2].
  • The question of quasi-government HOAs is expressed  as “the HOA is “simply a convenient mechanism to enforce those rights.”  Recall my charge that “HOAs are a devise to circumvent the Constitution.” The rights in context above refer to “the extension of the property rights” imposed by the CC&Rs.
  • “In contrast to the local government, which is considered a public body within the quasi-federal structure of state government, the HOA is generally considered a private entity, an extension of the property rights of homeowners.”
  • The author is concerned about the aggressive nature of the California legislature in regulating and controlling HOAs, far beyond their previous involvements. They deal with “what HOAs are really about: the ability to strictly control the character of the community by excluding undesirable uses of property within the community.
  • The controversial issue of consent to be governed or agreed to be bound does not escape Stahl’s view. “Homeowners are presumed to voluntarily subject themselves to CCRs when they choose to purchase property.” He makes the strong point that public policy  “causes courts to treat them as formally private, in contrast to the coercive nature of land use regulations enacted by public municipalities.”  This is a reference to the balance of power between the  state and supposedly freely agreed to expression of homeowners, the CC&Rs.
  • The mantra of CAI and legislators – You agreed to be bound! I witnessed an AZ legislator condemn a homeowner speaker that he was trying to get out of a contract that the speaker discovered was bad and he wasn’t going to be a part of it. A deal is a deal!
  • The author believes that the newer  legislative overrides will be constitutionally challenged,  arguing “ that overrides are likely to be upheld against constitutional challenges except in very unusual circumstances.”  In other words, Stahl seems to be saying that advocates can look to favorable legislation regarding due process and the equal protection of the laws for homeowners. He has already made favorable arguments in his journal article that simply need to be focused on justice and homeowner rights than just affordable housing.

I plan  at least  2 additional commentaries concerning this article following its structure: the role of equitable servitudes (covenants) and CC&Rs, and  constitutional concerns.

Acknowledgement

I would like to thank Barbara Lorraine-Johnston  for bringing this law review article discussing many of the constitutional issues that I have repeatedly argued and commented on over the years.  The importance of advocates bringing events, court cases, statutes, papers, articles, and law journal publications cannot be overstated. I can only comment on what comes to my attention.

For additional information, visit my comments, some 1,314 since 2004, can be found at HOA Constitutional Government.  Become a Subscriber to receive automatic updates.

NOTES

[1] “The Power of State Legislatures to Invalidate Private Deed Restrictions: Is It an Unconstitutional Taking?” (pepperdine.edu). (50 Pepp. L. Rev. 579 (2023)). Kenneth Stahl is a Professor of Law and the director of the Environmental, Land Use, and Real Estate Law program at Chapman University Fowler School of Law.

[2] Evan McKenzie, Privatopia: Homeowners Associations  and the Rise of Residential Private Government (1994) and Beyond Privatopia (2012)).

Calif AB 572 may face constitutionality challenges

42 USC 1983

The proposed California bill, AB 572[i] (brought to my attention by Marjorie Murray of CCHAL) faces a constitutionality challenge if past and enforced by the courts. This bill attempts to aid the state in its affordable-housing program by providing reduced  CID assessments to owners in the program: 5% limit increase on affordable housing units while others can be as high as a 20% increase.   This amendment also removes the CID covenant of equal assessments for all owners.  

HOAs (CIDs) are private contractual organizations protected by the Constitution prohibiting interference in contracts.[i] If a case is upheld by a court it can be argued that the law violates 42 USC 1983, Civil action for deprivation of rights – contract interference and “the equal protection of the laws” that favors owners in affordable housing.

“Every person who, under color of any statute [court decision], ordinance, regulation, custom, or usage . . .  subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law . . . .“

I would argue this position to the California House committee prior to its public meeting to give the committee time to consider its impact.

References

[i] AB 572.

[ii] See Art. I, Section 10, paragraph 1: “No state shall . . . pass any law . . . impairing the obligations of contracts.”

Fair HOA voting at risk in CA – SB 391

In April of this year I urged support (CCHAL in Calif. stands up to CAI) for CCHAL’s (Center for California Homeowner Association Law) opposition to California’s SB 391 that would allow online vote counting with no meaningful homeowner oversight. Another defeat of fair elections as expected in a community claiming to be democratic. At that time, Marjorie Murray CCHAL President, wrote:

“’The Community Associations Institute (CAI) and the property managers (CACM) are still “stretching the truth’ about SB391 (to put it politely.) CAI and CACM keep publishing ads saying  ‘SB391 gives HOAs the right to hold teleconference meetings during an emergency.’ This is FALSE.”

Yesterday Murray wrote in her urgent call to action email,

“SB391 is a dangerous bill – it’s being marketed by the association industry as one that “engages homeowners in governance” when what it really does is strip owners of the right to transparency and accountability in elections.

“SB391 IS NOW ON THE SENATE FLOOR AND WILL BE VOTED ON NEXT WEEK.  BE READY TO PHONE YOUR SENATOR TO URGE ‘NO ON SB391/MIN!”  Please PHONE, don’t email.”

Get with it Californians! Your voice is needed as legislators pay attention to the widespread  voice of homeowners affected by the bill.

CCHAL in Calif. stands up to CAI

The California homeowner activist group, CCHAL, with Marjorie Murray as its president is moving in the right direction.  In its email distribution urging homeowners to contact their representatives to OPPOSE SB 391, CAI is called to task and criticized for its support.

“’The Community Associations Institute (CAI) and the property managers (CACM) are still “stretching the truth’ about SB391 (to put it politely.) CAI and CACM keep publishing ads saying  ‘SB391 gives HOAs the right to hold teleconference meetings during an emergency…’ This is FALSE.”

We need more advocate leaders and homeowners to speak up strongly to force CAI to defend its statements, if they dare, or to shut up!  Silence only helps CAI to increase its stature before legislatures, the media, and the public. Victory is ours by not remaining silent!  

(See If only advocates would stand up to CAI).

CAI knows its defending the indefensible. Do you know that?

HOA Constitutional Government