Tag: ethical conduct

The influence of HOA special interests on an AZ legislator — SB 1454

First-termer idealism and the awakening

Michelle Ugenti arrived at the Arizona Legislature in 2011 riding in as a Clean Election Candidate, meaning she took no special interest money.  On her web page she quotes from the Arizona Constitution, “All political power is inherent in the people, and governments . . . are established to protect and maintain individual rights.”

It appears from her comments about her first term that she ran right into the reality of how bills become laws:

The following two years [after being elected] have taught me what happens when ideas and principles meet head-on not just with competing beliefs but also with individual self-interest, whipped into a frenzy by forces armed with money and power. 

She’s talking about the special interest money and the influence it has on legislators.  Still, with a positive outlook facing her re-election in 2012 Ugenti writes on her web page, “I hope that my constituents find me faithful to . . .  preserving our rights and freedoms.”

But, something seems to have happened to Ugenti upon her re-election in 2012.  She seems to have found and adopted the way and the means to make a name and to advance herself in politics.  She talks of hard politics, of when to compromise and when to negotiate, and of being successful and effective.

It is precisely this delicate balance of knowing what to give and what to fight for that makes an effective legislator. I believe I am successful because I have the integrity and courage to examine each issue and stand wherever my conscience and conviction demand I stand.

The lure of the special interests

In 2013 we saw Ugenti’s tenacity to fight and stand by her conscience in regard to her HB 2371 HOA bill and incorporating this failed bill into SB 1454. It ran afoul of the Arizona Constitution and House Rules. She showed her conviction before the Senate GE committee hearing on HB 2371 and clearly demonstrated her newly found path to success as a legislator – by advancing the agenda of the HOA “stakeholders,” the special interests who make money from servicing HOAs.  And CAI is one leading “stakeholder.” (Stakeholders are not homeowners who are excluded from such meetings. And the legislators well know it.)

At that hearing Ugenti stated that each year there was “a plethora of personal HOA legislation” and tried “to spare the [committee] members the constant agony of many personal pieces of HOA legislation,” as contrasted to the industry legislation. She also said that she “felt very responsible to the stakeholders.”   That was in March. In July a lawsuit, Staropoli v. State of Arizona,  was filed against the State for an unconstitutional SB 1454. The Attorney General’s office and court agreed, removing Ugenti’s HOA provisions.

Yet, the Arizona Legislature sees no wrong in her conduct leading to the filing an amendment from the floor and refused to discipline her. Ugenti’s integrity and conviction is examined in SB 1454: Machiavelli at work in the AZ legislature – Part 1 and AZ House ‘circles the wagons’ in defense of pro-HOA legislator.

CAI stakeholder support of Ugenti

In October 2013, stakeholder and national HOA lobbyist CAI praised Ugenti for her efforts to advance HOA interests, as CAI sees them.  In an article in the Fall 2013 Community Resource magazine, AZ lobbyist DeMenna wrote, echoing Ugenti’s view that only  stakeholder legislation has any value:

“Under the leadership of Representative Michelle Ugenti . . . a working group was established to address HOA-related issues advanced by legitimate stakeholders. . . . and Representative Ugenti personally led the effort to ensure that only sensible and functional proposals were considered. CAl played a critical role in this process, although some compromises were required. . . . In the end . . . Representative Michelle Ugenti, is to be commended for her leadership in this area.

And in the AZ CAI chapter’s email, Notice to CAI Members **Very Important-Please read!**, Oct. 18, 2013, the AZ chapter wrote, again echoing Ugenti’s views,

Representative Ugenti . . . is instrumental in the development of HOA policymaking. Representative Ugenti’s stakeholder meetings, formed in effort to tackle the growing number of HOA bills introduced every session, are critical in defeating shortsighted proposals.

The email went on to announce a fundraiser for Ugenti:

Fundraising Reception in support of REPRESENTATIVE MICHELLE UGENTI.  Please make checks payable to: MichelleUgenit.com [sic].  If you are unable to attend, you can mail your contribution to CAI’s Arizona Lobbying Team: DeMenna & Associates. . . . Paid for by: www.MichelleUgenti.com.

The decline and fall of a legislator

What happened to Rep. Michelle Ugenti since her first term in 2011?  It appears she has serious issues of integrity and the demands of her conscience to fight for her beliefs. She has fallen away from those ideals and values of “preserving our rights and freedoms”; and that governments “are established to protect and maintain individual rights.” The  authoritarian, private HOA government has no legal obligations “to protect and maintain individual rights” as does our Constitution with its Bill of Rights.

Apparently, she has succumbed to “individual self-interest, whipped into a frenzy by forces armed with money and power.” Her conscience and convictions have led her to advancing special interest agendas and to crossing the line and violating the Arizona Constitution.  

AZ House ‘circles the wagons’ in defense of pro-HOA legislator

I feel that I must respond to the statements made by the Senior Republican Policy Advisor and House Ethics Committee Chair, apparent spoke persons for the House, who whitewash and defend Rep. Ugenti’s actions as just another day at the legislature.  The wagons are being circled.

Constitutionality

Their view is that, Filing an amendment from the floor that turns out to be declared unconstitutional is not a violation; it happens all the time.  Considering the very narrowly tailored definition of unethical acts – only those pertaining to money – it’s no wonder legislators are free to do as they please. Allow me to clarify this misleading view of life at the legislature.

In my 13 years following HOA legislation I’ve come to understand that many controversial bills can be subject to opposing interpretations.  One side may see a bill as not violating the constitution and the other sees it as violating the constitution.  Obviously, the sponsor acting in good faith sees the bill as constitutional and proceeds, hoping that it is not challenged at some point in time and found unconstitutional.  

The court determines constitutionality based on several factors, which include an interpretation of the meaning of the words and sentences in the bill and the applicable law. In this case, Section 13 of the AZ Const., Part 2.  The criterion used begins with the ordinary meaning of the words being definitive and if a word is ambiguous, to rational interpretations of the wording of the bill.  It then looks at other criteria such as the intent of the legislature, if necessary to arrive at an interpretation that reconciles any seemingly contrary views.

Disorderly Conduct

To better understand the nature of the “disorderly act” in question let’s take a look at the relevant constitutional sections and House Rules.  Was a House Rule broken is the key issue?  Section 13 is a simple, direct statement:

“Every act shall embrace but one subject and matters properly connected therewith, which subject shall be expressed in the title; but if any subject shall be embraced in an act which shall not be expressed in the title, such act shall be void only as to so much thereof as shall not be embraced in the title.”  

House Rule 16, referring to Section 13, is a simple direct statement:  “To comply with this requirement, an amendment may not expand the scope of the original bill to give it a new purpose.”  

House Rule 1 is a simple direct statement:

“The House may punish its members for disorderly behavior and may, with the concurrence of two-thirds of the members elected to the House, expel any member (Arizona Constitution, Article IV, Part 2, Section 11). A violation of any of the House Rules shall be deemed disorderly behavior.”

It’s quite clear that House Rule 16 was violated by Ugenti and it is disorderly behavior. What is there to interpret in these applicable legal authorities quoted above?  She is subject to discipline if so decided by the House leadership unless she gets, for political reasons, special dispensation. 

Good faith unconstitutionlity

To put the Ugenti incident, “it happens all the time,” into perspective, let’s look at the recent appellate court opinion in Niehaus v Huppenthal (CV-CA 12-0242 Div. 1) alleging that the Arizona Empowerment Scholarship Accounts (ESA) statutes  violated the Constitution, Article 9, Section 10.[i]  The plaintiffs argued “that the ESA is invalid because it conditions the availability of a public benefit on a waiver of constitutional rights.”  The waiver dealt with a requirement not to attend public schools (a public right) if receiving ESA aid, which the court denied and also denied the complaint. This case was a legitimate question of good faith differing interpretations of the constitution and laws, where one party said Yes and the other said No.  The court gave its binding interpretation.

However, this is definitely not the case with Ugenti and SB 1454.  What is there to interpret and where is the good faith, rational alternative interpretation of the constitution?  Anyone can see the obvious black letter violation. Unlike the bills alluded to by the spoke persons, the inclusion of HOA amendments can only be seen as an intentional and knowledgeable act causing the bill to become unquestionably unconstitutional. It was also a violation of House Rule 16. The everyday meaning of Section 13 and the House Rules are quite clear and there is no room for any rational alternative interpretations.  The Arizona Attorney General’s office, representing the Legislature, agreed that the SB 1454 violated Section 13 of the AZ Constitution and offered to settle. The court declared it so.   

Motivation

What is really at issue is why Ugenti violated the constitution and rules?  Failing to conduct an inquiry amounts to a failure to do justice.  Committing an intentional violation cannot be treated as acceptable conduct for an elected official, a legislator.

So we must ask: What was Ugenti’s motivation for her last woman standing act at the last session? We know she told the GOV committee that she had “a responsibility to the HOA stakeholders,” a group that does not include homeowners nor HOA directors. We know the stakeholders held meetings on SB1454 and HB 2371, its forerunner.

In her defense, Ugenti has blamed some mysterious staff person or House attorney for her action, claiming that she was advised that SB 1454 was not unconstitutional. (I am told that the House Ethics lawyer said he gave no such legal advice).  She took this “advice” with its unreasonable interpretation, but allowing for plausible deniability, that somehow using the word “election” in one of the HOA amendments was OK.  It allowed all other HOA amendments to also be germane to the subject of the title.  This defensive argument is not rational by any means, is without merit, and as attorney Tim Hogan commented, “That’s a far stretch.” 

Removal of ‘HOAS’

And let’s not forget the weak defensive argument that the question is really about the “short title” and not the “title” itself; that the title did list the HOA statutes being amended and no error was committed.  But, the title did not contain the wording “Relating to HOAS,” as required by the bill drafting manual, that would have identified and alerted the public to the additional subject matter.  With over 1,000 bills before the legislature, the first and primary vehicle to identify bills is the index to the bills that only shows the short title.

Furthermore, a disciplinary investigation should also look into the matter as to who changed the title of SB 1454 removing “HOAS,” which can be still found on the Arizona Capitol Times and ADRE (real estate department) websites.  ARS 41-1224 makes the tampering of an introduced bill a class 4 Felony (1 – 3.5 years prison time). But, the wagons are being circled and a cover up is becoming apparent.

The settlement agreement bypassed any exposure or testimony relating to the motivation for her disorderly behavior.

Intent to deceive

If we examine the events surrounding these HOA amendments that had their origin in several bills that were combined into HB 2371, and then added to SB1454, it follows that there was an intent to get a twice failed bill made law. It was an intent to accomplish this by violating the Arizona Constitution in a desperate last ditch attempt in the closing hours of the legislative session.

For these reasons disciplinary action is warranted as set forth in the House Rules.  The people seek transparency and have the right to know just what happened!

Notes

[i]Aid of church, private or sectarian school, or public service corporation

Section 10. No tax shall be laid or appropriation of public money made in aid of any church, or private or sectarian school, or any public service corporation.

 

AZ ethics chair finds no violation by Ugenti in SB 1454

See-hear-speak no evil
See-hear-speak no evil

In response to my petition[1] to the AZ Speaker of the House and House Ethics Committee to bring disciplinary action against Rep. Ugenti, I received a short, late evening response from the Ethics Committee Chair, Rep. Lovas.  The terse response amounted to “the act of offering an amendment on the floor does not rise to the level of disorderly behavior for purposes of Ethics Committee jurisdiction. . . . The Ethics Committee will not be taking the matter up further.”  This was a strict interpretation of the meaning of ethics, which under the House Rules deals only with financial issues. It says that a violation of the Arizona Constitution by an elected official is not an ethical concern.

Where ethical restraint is lacking, there can be no hope of overcoming problems. (The Dalai Lama).

 

Very much disappointed in Rep. Lovas’ response, I replied in a little more detail.

 

Rep. Lovas,

I appreciate your late evening response to my emails seeking disciplinary action against Rep. Ugenti for her conduct in submitting her waning hours amendment to SB 1454. The strict interpretation of the committee’s jurisdiction holding that Ugenti’s conduct was not “disorderly behavior for purposes of Ethics Committee jurisdiction” is disturbing. How can a violation of the law by an elected representative, a legislator, not be viewed as unethical? The bill with Ugenti’s amendment was stipulated by the Legislature (per paragraph 22 of the Stipulation) to have violated the Arizona Constitution’s prohibition against bills with more than one subject. And the court so invalidated her additions.

I am disappointed in your response. You treat this incident as “just another day at the office” and this is the way the Legislature works. That if a legislator can violate Section 13 of the Arizona Constitution, so be it. And if caught in doing so and a court invalidates the effects of the legislator’s actions, the attitude of the Ethics Committee seems to be, Oh well. The legislation is invalid. Let’s move on to next year. It smells of, if you can get away with it, good. If not, don’t worry since we will take no action.

 (I am well aware of Randall Gnant’s comments in his guide for the public, From Idea . . . To Bill . . . To Law, p. 51-52, on the not infrequent disregard of constitutionality of legislation by the Legislature).

I do not understand how Ugenti’s actions do not constitute grossly unethical conduct. It sends the message that, yes, this is the way it is. That the Legislature, as sovereign of the State of Arizona, can do no wrong. Sorry, I cannot accept that “this is the way it is.” The people have a “social contract” with the State of Arizona government that binds both parties, which, by your decision, shows that the Committee has chosen to ignore its duties and responsibilities under that contract, the Arizona Constitution.

I understand that much of what I had described in my case for disciplinary action is considered as that’s the way legislation is accomplished, that’s the way the legislature works.[2] Nothing wrong. However, in your response you categorize and restrict Ugenti’s action as a simple filing of an amendment. You mention nothing about the bill was her third and last ditch attempt to get it passed into law. Or that it was in violation of the Constitution and House Rule 16(D), which prohibits any such bill. House Rule 1 says that a violation of these rules can result in disciplinary action and even the expulsion of a legislator. You trivialized the entire incident.

Let us understand the gravity of Ugenti’s knowing and planned violation of the constitution. In the late 1930s President Roosevelt attempted to get legislation passed to pack the US Supreme Court in order to accomplish goals that he believed were for the good of the people — not the party, not the special interests. He was opposed by the US Senate that believed that the President was tampering with the balance of the separation of powers, which was not good for the country. In this incident, no laws were broken and no rules were violated in spite of the overwhelming controversy and seriousness of the legislation.

 More recently, the US Supreme Court in its Kelo decision found justification for interpreting “public purpose” the same as having the eminent domain meaning as “public use.” No laws and no procedures or rules were broken. All was legit and was viewed as in the best interest of the country. But, sadly, not with SB 1454. Not only was a Rule broken, but the Arizona Constitution as well. And the evidence I put forth shows the heavy hand of special interests, the HOA “stakeholder” cabal. (There is more that I have not yet released). Yet, no evil is seen by the Ethics Committee and that no investigation into the affair is warranted. What message does this send to the people of Arizona? What does it say about the State of Arizona?

 I cannot stress the need for action by the Ethics Committee to restore the faith and confidence in the Arizona Legislature. I ask that the committee take whatever action is appropriate and necessary for the House to commence disciplinary charges per House Rule 1. Ugenti must not be given a clean bill of health, a pass, a walk to try again another time. Disciplinary action will also serve as a deterrent to other so inclined legislators.

Please urge the Speaker to undertake disciplinary action on behalf the people, for the good of Arizona.

 

George K. Staropoli

 

SB 1454: Machiavelli at work in the AZ legislature – Part 1

Part 1. Rep. Ugenti, Senator Griffin and lobbyist Sandquist 

(See Part 2).

Back in July I commented about SB1454 and wondered whether the Constitution or Machiavelli was alive and well in the Arizona Legislature.  In the subsequent two months I’ve come into possession of additional information on the events surrounding SB 1454 and its predecessor, HB 2371, and the underhanded manner in which it became an unconstitutional law. 

This post elaborates on the above commentary, which should be read first as it provides background information. This post also provides insight on how a legislature really functions, and undoubtedly how your legislature functions with respect to HOA legislation.

Furthermore, for a better understanding of the events the reader should view my video of the HB 2371 hearing before Senator Griffin’s GE committee.  It includes some interesting statements between Rep. Ugenti, who sponsored HB 2371, and Griffin; and between the HOA manager association lobbyist and Griffin. (The lobbyist’s statements begin at 9:13 into the 11 minute video). 

Please pay attention not only to their words, but to their body language as well. Listen to their arguments, but closely examine what is being said “between the lines.”

 

A.        Representative Ugenti

The March video of Senator Griffin’s hearing shows a perky Ugenti exuding confidence. She makes use of the special interest mantra, “stakeholder,” and states how all the stakeholders met and agreed upon the bill. She basically tells the committee that they are vendors (“stakeholders” refers not to homeowners, but to all those vendors who are making money off the HOA and off the homeowners).  The problem is, is that these vendors are daring to set legislation affecting the rights of homeowners that serve their own agenda.  Yet no committee member asks, “Where are the homeowners?”

Ugenti stated that each year there was “a plethora of personal HOA legislation”[1] and tried “to spare the [committee] members the constant agony of many personal pieces of HOA legislation,” as contrasted to the industry legislation. Ugenti also said that she “felt very responsible to the stakeholders.”

 

B.        Senator Griffin

Senator Griffin is also the Senate President Pro Tempore, second in line in the leadership hierarchy. The AZ Legislative Manual states that, “the chief duties of these officers are to preside over Senate and House proceedings and to otherwise assume the duties of the President and the Speaker when they are absent from the Legislature.”  

Griffin played a role in two separate incidents.   The first, see (C) below, is her withdrawal of an amendment to HB 2371, thereby allowing HB2371 to go on the Consent Calendar. This calendar leads to a direct vote by the Floor without further debate by all the representatives. However, it was objected to being on the Consent Calendar, which forced the bill to be debated by the Committee of the Whole (COW).  The bill was never debated and never came to a vote; it died in the Senate.

Second, having faced defeat in her bill Ugenti once again obtained the co-operation of President Pro Tem Griffin. Griffin added the failed HB 2371 HOA amendments to HB 2518 (Rep. Olson was the Sponsor), now before the Senate.  The bill passed the Senate and was sent to the House where a Conference Committee was recommended – the House did not accept the Griffin/Ugenti amendment.  This time, the House failed to hear the amended HB 2518 and it, too, died along with Ugenti’s HB 2371 HOA amendments.[2]

  “The role of morals in politics is mainly to cultivate illusions . . . politics is merely appearance and morality is merely pretense.” (“Machiavelli and America,” Hadley Arkes, p. 104, The Prince (Yale University Press, 1999)).

 

 C.       Jeff Sandquist, AACM lobbyist

At the end of the above mentioned video (see Part 1), Jeff Sandquist, lobbyist for the Arizona Association of Community Managers (AACM) addressed the committee.  AACM stood to gain much from HB 2371, which would allow its members to represent HOAs in small claims court and before administrative law judges at OAH (Office of Administrative Hearings).  State certified legal document preparers (paralegals) are not allowed this right. There were no provisions in the bill for licensing, training, or educating property managers to adequately represent HOAs. Nor equal representation for homeowners.

Note the very friendly dialogue between Sandquist and the Chair, Griffin, which is out of order for a committee hearing.  “Tell your Mom hello for me.” Griffin mentions that making an amendment got her to see her “buddy” Sandquist.  He thanks her for not offering her amendment.

Sandquist also vaguely spoke about how the courts would like to see a provision moved to another section, implying an acceptance by the courts. It also implies a recognition of a separation of powers issue on granting HOA managers representation rights.

Two days after filing the complaint, about a month after the Governor signed SB 1454, a Supreme Court Rule 31 change was requested seeking an exception for HOA managers to be able to represent HOAs in small claims court (still pending).

[1] I digress. My emphasis reflects, to good extent, homeowners failing to see the broader picture beyond their HOA problem, such as raising substantive issues of constitutionality. Ugenti is saying that homeowners don’t really understand the problems with HOAs, which only the HOA industry special interests can solve. It is evident that this is the view held by all state legislatures across the country. Homeowners have failed to deal with this reality.

[2] In my 13 years I have seen isolated cases in various legislatures in different states where the right and ethical action was taken and legislation was defeated or passed as appropriate, as we see here with these 2 bills.  But, on the whole, far too few.

SB 1454: Machiavelli at work in the AZ legislature – Part 2

Part 2 – UPL violations and “HOAS” in the title.

(See Part 1).

E.         Sanctions against HOA managers violating UPL

In spite of several emails sent to Rep. Ugenti, the Senate GE members, and the public in general there was no mention in the public hearings about the actions taken by the Arizona Supreme Court document preparer board in 2012 regarding the unauthorized practice of law, Supreme Court Rule 31). (See Arizona’s HB 2371 empowers unlicensed HOA property managers to avoid UPL).  I refer to the State Bar UPL Advisory Opinion, 12-01 and the decision holding AAM, a AACM and CAI member, to have repeatedly violated UPL.  (Supreme Court Board of Legal Document Preparers v. AAM, LDP-NFC-09-L094 and LDP-NFC-10-L026). Rather than seek remedial legislation SB1454 and HB 2371 sought to exempt HOA managers from UPL.

The illusion and appearance that all is well and that no stakeholder or legislator was aware of these actions was successful. 

 

F.         Arizona Capitol Times showing “HOAS” in SB 1454 short title

Finally, the weekly Arizona Capitol Times (ACT) covers goings on at the capitol and produces an online LOLA Report listing the short and long titles of all the bills. Its LOLA shows “HOAS” in the short tile of SB 1454. It states that the info is taken “from Arizona Capitol Reports reporters and records and from state and other databases. Bill-tracking information is updated continuously during legislative sessions.”   But, the official ALIS public access to legislative bill information does not show a short title with “HOAS.”   Who, when, and how was “HOAS” removed from the short title?  And why was it removed?  Surely ACT had no motive to change ALIS to add “HOAS”, and would not dare to do so.

Curiously, the AACM website under Legislative Update shows the same short title as from LOLA, as AACM states that’s where it got the info.  Why wasn’t this called to Ugenti’s attention, or did nobody notice?  Yet, there’s an addendum tacked on to the title, in all caps, “AS SIGNED BY GOVERNOR,” which could only come on June 20th or later with still no correction to reflect the official ALIS version.  Why not?

It has come to my attention that Jeff Sandquist, AACM lobbyist, explained that the state’s position for settling the constitutionality lawsuit was because it wanted to save portions of the bill that it thought was more important.  He seems to be aware that if the court declared the entire bill unconstitutional the initial SB 1454 provisions dealing with Elections would also be invalidated. However, by leaving off “HOAS” in the title the State could argue, if indeed the “plot” was discovered, as it was, that only the second part of Section 13 of the Constitution applied. This would only invalidate the HOA provisions. And so it happened. 

Was this the plan for removing “HOAS”?  Was this the plan for getting Senator Yee’s approval for attaching HB 2371 to her bill, SB 1454?  That her original bill would survive? Recall that Rep. Olson apparently didn’t approve of the Griffin attempt to add HB 2371 to his bill, HB 2518, and it died.

So I argue SB1454 was rushed through in the final hours of the night on the last day of the session, in the midst of attention focused on the budget and Medicare issues. The session ended just before 1:00 AM on the 14th.

“The founders understood that the principal mission of government was to secure people in their natural rights — to protect them against the lawless private thugs as well as of ill-intentioned legislators.” (“Machiavelli and America,” Hadley Arkes, p. 145, The Prince (Yale University Press, 1999)).

The arguments and events presented here make a case for a frustrated Rep. Ugenti who, in an act of desperation, intentionally violated the Arizona Constitution and House Rule 16(D).  The Legislature cannot sit idly by and allow a flagrant violation of the Arizona Constitution to go unpunished. It must send a message that such ardent belief in a bill does not allow for the law to be broken and that the end does not justify the means. 

I have urged the Arizona Speaker of the House and House Ethics Committee to bring disciplinary charges against Rep. Ugenti and to seek her expulsion under House Rule 1. Many questions remain unanswered.