Friday, July 27, 2012

From CCHAL: CID promotion and the California foreclosure debacle

This just in from the Center for California Homeowner Association Law--for years I have been posing the question, "What are the long-term consequences to municipalities of promoting CID construction?"  This post from Marjorie Murray is suggestive of one possible answer:

Realty Trac has posted its report on foreclosure filings (Notices of Default) across the country, and once again California leads the pack. 

Note that six of the ten cities/counties with the greatest number of NODs are in the Central Valley, which are now over-run with common interest developments.  Why?  Because that's where vast tracts of land exist: land formerly dedicated to almonds, cotton, alfalfa and other crops.

Not long ago, the Center for California Homeowner Association Law researched, by county, the number of CIDs built in the Central Valley in the last decade.  The growth has been phenomenal. 

After approving dozens of huge planned unit developments in the past ten years, Stockton (San Joaquin County) went on a spending spree in anticipation of the tax revenue it believed CIDs would generate" property taxes, sales taxes, state taxes based on population. This was wishful thinking.  As readers of your blog know, the City of Stockton just filed for bankruptcy.

I won't enumerate all the public policy issues generated by this growth in the Central Valley, but two of them are worth listing: the demand for water by huge new subdivisions and the substitution of CIDs for agriculture in the California economy.  No state agency has examined these key policy issues.

Here's the Huffington Post story on the California foreclosure debacle.

Marjorie Murray, President
Center for California Homeowner Association Law
3758 Grand Ave., Suite 56
Oakland, California 94610

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