Towns Rethink Self-Reliance as Finances Worsen - WSJ.com: "As the recession batters city budgets around the U.S., some municipalities are considering the once-unthinkable option of dissolving themselves through 'disincorporation.'
Benefits of this move vary from state to state. In some cases, dissolution allows residents to escape local taxes. In others, it saves the cost of local salaries and pensions. And residents may get services more cheaply after consolidating with a county."
-------------
Who will go out of business first? The municipalities or the HOAs?
2 comments:
The HOAs because privatizing local government is a more optional last -- and unnecessary -- layer of local government. Not only that, they are politically unpopular with many voters who might at some point vote against those who support them or promote referenda barring them.
I agree with Fred Pilot, but will add that many HOAs, in addition to being politically unpopular, are, in many cases, financially unviable. The vicious cycle of increasing foreclosures by lenders, which is exacerbated by the actions of the HOAs themselves, is leading to many CIDs becoming financially imploded ghost towns.
The best public policy would be to allow residents in CIDs to dissolve them and to combine many developments into a single larger public entity, like a city or township to own the "common" areas. Developments without amenities would have the option of having no such entity at all.
Of course this is a pipe dream, because the CID industry will continue to obstruct any useful and meaningful reform. The result will be many more financially imploded developments full of unoccupied and decaying houses. Ironically, this is the very blight that the municipalities were trying to prevent by mandating the instituting of HOAs in all new subdivisions.
Post a Comment