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February 5, 1999 The Honorable J. E. "Buster" Brown Dear Senator Brown,
I am writing you again about the proposed changes to homeowners association's
powers. My letter to the hearing held by the Committee on State Affairs was published in their
report titled Legal Powers, Duties and Structure of Homeowner' Associations in
Texas. Though the committee acknowledged the abuses, it appears to me the changes they
suggested are largely cosmetic. The central issue is the provision that allows these
associations to collect all their legal and other costs from a resident who resists their
demands. The potential magnitude of these costs makes the threat into
extortion -- "an offer
they can't refuse. " Until this root problem is corrected all other proposals simply avoid the
issue. In my view, the only committee proposal that does anything at all toward mitigating the
situation is Recommendation Number Four -- binding arbitration. But, Number Four is
made essentially moot/inoperative by Recommendation Number Three. Number Three,
J. P. court, retains much of the extortive legal costs and, doesn't provide as much isolation
from "Good ol' boy" favoritism as is provided by Arbitration. To repeat--whatever the reasons, the Committee's proposed changes don't directly address
the real problem -- a weapon of extortion falling into the hands of irresponsible
people. Irresponsible or over zealous Directors, threatening homeowners with substantial legal
costs if they do not comply immediately with association demands. For example, one proposed change is to require some kind of "certification" of the people
elected as directors of these organizations. It's not at all clear to me how certifying board
members will do anything to prevent irresponsible use of their power. They already have
specialized lawyers advising them and carrying out their actions. Another
example; the Committee suggests adding a requirement that homeowners be given
an opportunity to present their case to the association 's board of directors prior to any
legal action. How will this help? The reasonable people who make up most of these boards
aren't the problem. The problem is boards run by irresponsible people.
How will asking
irresponsible people to stop being irresponsible help? They also suggest making sure each purchaser is informed about the deed restrictions at
the time of purchase. While obviously this should already be being done, it does nothing to
protect against unreasonable interpretations and enforcement of these
restriction. The committee accurately observed that Homeowners' Associations, while treated as
private, nonprofit corporations under the law, have become "de facto political
subdivisions" with powers to compel membership, to collect fees comparable to taxes and
to wrest people's homes from them through foreclosure. They even recognized, in the
words of the Chairman, that "they [are] just a racket in some locations. "
I urge you to press for REAL change to this unhealthy situation.
Sincerely
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