Johnson battles homeowner's association in court

A homeowner's association in Kettering is suing Prince George's County Executive Jack B. Johnson (D) and his wife for allegedly failing to pay assessments to the HOA.

In court papers filed in Prince George's County District Court, the Kettering Community Association is asking for about $1,500 in late assessments and legal fees.

"We had this house for 30 years, paid our dues consistently for 30 years," Johnson said in an interview Friday. "They claim we didn't pay. ... It's only $150 (per year). The next thing I know I get a bill for $1,800 or more ... and [got a notice] they are going to foreclose on my house [from] some lawyer. I got pretty mad. I hired a lawyer representing me. ...

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Mr Johnson says: "There's a pattern that's been really frustrating for us," he said. "You have these developers that come in and they build condominium associations and homeowners associations, but the way the bylaws are drafted, the citizens of Prince George's County never take control over their own communities."

Oh, Mr Johnson, I think the problem is much bigger than that!

Two bodies found in S.W. Reno house that burned after reported explosion

Investigators have found two bodies in the burned-out rubble of a home in an exclusive southwest Reno neighborhood. They have been unable to identify the victims who died in the blaze, which began shortly before 11 a.m. Tuesday.

Deputies with the Washoe County Sheriff's Office had attempted to serve an eviction at the home, which was under foreclosure, on Tuesday at about 10:40 a.m. They said they knocked and identified themselves, then heard what sounded like gunfire or an explosion and took cover.
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Thanks to a a friend who alerted me to the story.

No word on whether this was a bank or an HOA foreclosure. Regardless, this is not the first time a homeowner has has self immolated in a burning house they were about to be evicted from. I sometimes think we are a little too cavalier about kicking people out of their own homes in this country.

Petition seeks to have wolves howl across US

Petition seeks to have wolves howl across U.S.

Those wild canines better not howl too close to any exurban HOAs or they may find the HOA will send out the exterminators.

Money missing from St. James HOA leads to embezzlement charge for employee

St. James | Brunswick County Sheriff's Office investigators arrested a Wilmington woman in an embezzlement scheme that siphoned more than $12,000 from the St. James Property Owners' Association.

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Another embezzlement story from Cynthia Stephens.

Carolina Beach woman charged with embezzling $30,000A Carolina Beach woman has been charged with embezzling about $30,000 from homeowners associations

A Carolina Beach woman has been charged with embezzling about $30,000 from homeowners associations whose money she managed.

Michelle Lynn Bowman, 42, of 300 The Cape Boulevard, was arrested June 28 after turning herself in to Carolina Beach police. She is still being held in New Hanover County jail in lieu of $40,100 bond, according to jail officials.

She is accused of using identification numbers from four homeowners associations to get bank cards and withdraw cash, said Lt. Bill Goodson of the Carolina Beach Police Department.

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Thanks to Cynthia Stephens for this story. I wonder how much money is missing from communal coffers in America's hundreds of thousands of residental associations?

California political paradox unveils underlying tension between voters, interest groups

The Los Angeles Times has highlighted a political paradox that's playing out in California and certainly other states and the nation as a whole. While anti-incumbent sentiment remains high (last month, California voters nearly elected an unknown state worker who spent less than $5,000 on his campaign over an incumbent Assemblymember as the GOP nominee for insurance commissioner), it is incumbents whose campaigns are getting funded and not their challengers.

Voters in effect are saying we want new blood and someone not beholden to special interest groups, but we'll elect incumbents over non-incumbents since special interest groups get the incumbents' name out there more than their relatively unknown challengers. The real fight isn't over who gets elected, but between the voters and special interest groups.

The explosion of the Internet, which is already blowing a huge hole in the business models of the mass media, could change the equation. Folks running for office -- particularly in large, populous states like California -- have to raise gobs of money in order to buy political ads from mass media outlets. However, if more voters already sick of junior high school level attack ads decide to ignore them and visit candidates' websites instead, the balance of power is shifted between them and the special interest groups that fund candidates' high priced TV spots.

At Mass this morning, there was a reading from Micah, II,1-3

Sent to me from a friend. Am sharing with permission.
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"Shame on those who lie in bed planning evil and wicked deeds and rise at daybreak to do them, knowing that they have the power!
They covet land and take it by force; if they want a house they seize it; they rob a man of his home and steal every man's inheritance.

Therefore these are the words of the Lord:
Listen, for this whole brood I am planning disaster...

Goodness! I didn't know the CAI-HOA was active then, too!

Texas HOA property owners outraged over lack of transparency, questionable expenditures

The neighbors wanted everyone to know exactly where their dues were going, so they also presented their findings at a recent HOA meeting that got so out of control some people were threatened with arrests.

"People are outraged," exclaimed Peggy Sue Wilson-Schmueckle. She’s the homeowner leading the fight to rid the association of what she calls gross mismanagement of funds by the board. “Once we uncovered it and did an audit, people were very outraged. They want them [the current board] to resign.”

The information we uncovered explain why the homeowners are so bent out of shape. Records detail board meetings at nice restaurants; meetings that were not open to the public. We also found a document showing a $4,200 expense paid to the board president's son-in-law for brush work he did in the neighborhood. Additional records showed the HOA donated thousands of dollars to random charities. The HOA even gave more than $1,300 to a group of HOA lawyers to help them lobby the legislature.

Florida HOA threatens $100 a day fine for unapproved shade of mulch

Lynn of Davie couldn’t believe her eyes, but a letter from her homeowners association confirmed the worst: She faces a potential $100-a-day fine for having the wrong-colored mulch in front of her house.

Lynn tells me that her problems began when the Association made it known it was displeased that home’s mulch had thinned out too much and needed replacing. To appease the board, Lynn and her husband added new match, but apparently the golden shade of mulch the couple chose was not in accordance with what the Association wants. Thus the ultimatum: Put in new mulch or pay $100 a day until you do.

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As the owner of this blog has noted, there seems to be no limit to how frivolous HOAs can be.

Homeowners Associations Get Nasty: Foreclose or Sue to Collect Dues

In 30 states, HOAs have the power to foreclose on homeowners who do not pay up, which has made them even more vilified than the IRS!And now some are resorting to cutting off utilities: A Georgia woman has been living without water for more than a year now, all because she failed to pay her HOA dues.

Texas State Sen. John Carona (R-Dallas), who serves as president of a huge national realty property management firm with $400 million revenue, says the Texas law that permits HOAs to foreclose should not be changed. Tweaked, but not changed. When you sign for your mortgage, he said, you also sign and legally agree to be a part of the homeowners association. That's fair -- you are duly warned and don't have to buy the property if you don't like the association's terms (my words). He advises buyers to read HOA rules carefully before buying. Seek counsel, if necessary. He also says that homeowners who don't pay their share of homeowners association dues force a hardship on other homeowners in the neighborhood, who often have to kick in more for expenses.

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Life is so simple, "if you don't like it, move" or better yet, "Don't live there". If you sign your mortgage docs, you agree to be abused, fined, have your water turned off, get evicted from your own home.

And you thought the IRS was the most hated entity in the country.

Ah yes, more happy homeowners Zogby missed - this time around.

Sailor faces fine for leasing condo

Homeowner's association charges sailor $10 a day CHEASPEAKE, Va. (WAVY) - For three years, the condo on Rivanna River Reach was home for Mike Lukaszonas.
But when the Navy transferred the helicopter pilot to Florida, he started leasing his home to someone else to help pay for the mortgage. He asked his homeowner's association for permission
"They decided unanimously to vote no," said Mike Lukaszonas, "and the reason was never cited in the letter. They just said denied."

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Another genius board at work here.

I wonder if Zogby ever talked to anyone in this haven of happy homeowners?

Power company tells customer she is dead

Power company tells customer she is dead

VIENNA (Reuters) – An Austrian woman has had to convince her electricity supplier that she is alive after the company wrote to her asking for information about her contract following her "passing away."

In a personally addressed letter, the Linz-based company said it had heard of her death through her bank, daily Oesterreich reported on Thursday.

"I am not the dead one," 58-year-old Christine R. wrote back in a fax and email to the company, explaining that it was her neighbor who had died and she was the custodian. She eventually went to the customer center in person to prove her existence.

The Next Foreclosure Fight

CNBC does a segment oh HOA foreclosures. Tom Skiba of CAI defends the HOA's ability to foreclose and Bill Davis does a great job of presenting the other side. You can view the video clip at this link.

http://www.cnbc.com/id/15840232?play=1&video=1544519000

HOA Turns Off Marietta Woman's Water

MARIETTA, Ga. - A condominium owner who's been without water for over a year is pleading with the Magnolia Lane Homeowner's Association in Marietta to turn her water back on. Helen Burgess says she is trying to pay off her debt but says the HOA just won't work with her.



Burgess' attorney said if the Magnolia Lane HOA accepted Burgess' offer last year, she would've shaved close to $3,000 off her debt, but now she's added another $3,000.

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They're all heart, these HOAs, aren't they? They won't work with her and instead of making it easy, they just make it harder for her.

Here is another happy homeowner Zogby missed. An "isolated incident"? I think not.

On the front lines in Vegas: Economic firefight erupts from residential real estate crash

In Clark County, Nevada there's little tolerance for owners of foreclosed REO (Real Estate Owned) properties who fail to keep them up to county building and HOA standards. Clark County is levying daily fines of $1000 for failure to correct violations of Clark County Code Title 11, the Rehabilitation of Abandoned or Rental Residential Property, according to this Las Vegas Business Press story. The newspaper reports the fines and similar sanctions levied by homeowners associations "have already chased away prospective buyers" who would have to pay them.

The upshot is if REOs aren't maintained and the fines rapidly accumulate into big liens, the properties could ultimately become worthless since the cost to acquire them with the county and/or HOA liens tacked on could reach an appreciable fraction of their already depressed market value.

This is a real economic firefight arising out of the residential real estate crash that could end up with no winners and plenty of casualties. The owners of the REOs would lose and so would Clark County and HOAs with their jurisdictions littered with unmarketable, dilapidated properties.

Mamas don't let your babies grow up to buy condos

ORANGE COUNTY, Fla. -- Some Orange County condo owners are living with a nasty green swimming pool and large holes in the buildings even though the owners pay more than $250 a month in homeowner association dues.WFTV learned Tuesday that the property managers at the Silver Pines Apartments on Pine Chase Drive (see map) , near Silver Star Road, won't do anything to fix the problems.Brenda Mallard has a nice condo inside, but it's the outside she's worried about.“I'm angry, yes, I am angry because it's ridiculous," Mallard said.Four the past four years, she's seen the place go from bad to worse and she's not the only one who feels that way."It's just bad, man, it's just really bad," condo owner James White said.There are holes under the eaves, you can look straight into the attic at night, and people there say they hear animals running around inside. Then there's the swimming pool, which is filled with green goop. No one has gone swimming there in years.
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Sounds like something out of a Joe Bob Briggs drive in movie review that might read as follows: Pool filled with green goop. Rats in the attic. Indoor rainfall. Condo fu. Film at 11 on WFTV channel 9. Three stars. Joe Bob says check it out.

Blagojevich: Musings of ex-governor included Bleep the public, Oprah for senator

CHICAGO -- Former Illinois governor Rod Blagojevich may or may not have broken the law, but he sure did hate his job. He reviled his political enemies, mocked many of the candidates for a vacant U.S. Senate seat and disparaged the voters who failed to appreciate his talents.

"Only 13 percent of you all out there think I'm doing a good job. So [expletive] all of you," the salty-tongued Blagojevich (D), referring to poll numbers, said in a secretly taped conversation played at his federal corruption trial.

By the time Democrat Barack Obama had won the White House in 2008, the two-term governor was deeply in debt and obsessed with finding a new job that paid well. He spent as few as two hours a week in the office, sometimes hiding in the restroom to avoid his budget director.

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Why is it we manage to elect the worst candidates for leadership positions in this country? Is it because the good leaders don't run for office? Here is another gem!

Economists see U.S. recovery weakening: survey

Economists see U.S. recovery weakening: survey

WASHINGTON (Reuters) – The U.S. economy will lose steam as the year progresses but will not slide back into recession, even though unemployment is unlikely to fall significantly, according to a survey released on Saturday.

The Blue Chip Economic Indicators survey of private forecasters found analysts increasingly glum about the outlook. They now see the economy expanding just 3.1 percent in 2010, down from 3.3 percent in the June poll.

They do not, however, envisage a renewed period of contraction, which has been widely debated in financial markets in recent weeks.

"Our panelists think talk of a double-dip recession is overblown absent a new, major shock," the group said in its report.

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One of the more significant parts of this economic story is near the end:

Along with more moderate growth, inflation is expected to remain extremely tame. Forecasters are looking for a 0.9 percent increase in prices for 2010 as a whole, the smallest rise since 1950.

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When the economy gets the stuffing knocked out of it to the extent it has over the past three years of 2007-2010, the danger of deflation looms. Think of deflation as reverse inflation. Instead of the cost of goods and services being ratcheted up, prices enter a self reinforcing spiral of decline. Instead of too much money chasing too few goods and services, there’s too little money chasing a plethora of products and services. They become undervalued instead of overvalued.

Unlike in an inflationary economy where people accelerate buying decisions in the hope of beating price increases, in a deflationary economy these decisions are delayed with the expectation that prices will decline and a better deal can be had simply by waiting. With consumers tapped out of credit and many unemployed, waiting becomes far easier. That of course retards economic growth, stalling a speedy recovery.

The last time the economy was tanked by speculation and excess leverage was in the Great Depression of the 1930s. It lasted about ten years. We are in a similar situation today. The decade of 2010-20 could end up as a deflationary “lost” decade that people endure and muddle through until a more sustainable socio-economic environment emerges. The deflationary decade may in retrospect mark the death of an economy driven by excess consumerism, speculation and leverage, a passing necessary to make way for the birth of a new and more sustainable economy.

Homeowners association demands removal of energy-efficient door

Ashley Woods West resident says California Solar Rights Act protects his right to use the passive solar door

When Frank Sigrist installed a passive solar garage door in his Granite Bay house, he forgot to submit an application to his homeowner’s association.

He filed the required documents a month or so later, thinking he wouldn’t be denied permission because the $10,000 state-of-the-art door is energy efficient and aesthetically pleasing — besides, the garage sits far back off the street in this upper-end gated community.

“It’s not going to be a big deal,” Sigrist said.

But he was wrong.

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Nah, who would have thunk it?

But board members are reasonable people, acting reasonably, right?

Moral hazard in the jumbo mortgage marketplace

NYT: Biggest Defaulters on Mortgages Are the Rich

LOS ALTOS, Calif. — No need for tears, but the well-off are losing their master suites and saying goodbye to their wine cellars.

The housing bust that began among the working class in remote subdivisions and quickly progressed to the suburban middle class is striking the upper class in privileged enclaves like this one in Silicon Valley.

Whether it is their residence, a second home or a house bought as an investment, the rich have stopped paying the mortgage at a rate that greatly exceeds the rest of the population.

More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic.

* * *

Lenders are fearful that many of the 11 million or so homeowners who owe more than their house is worth will walk away from them, especially if the real estate market begins to weaken again. The so-called strategic defaults have become a matter of intense debate in recent months.

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Moral hazard -- the risk that parties to a financial transaction won't honor their obligations -- played a major role in the Wall Street crash in the fall of 2008. Now it poses a problem in the jumbo mortgage market: mortgages of $500K on up. Since a lot of these highly leveraged, high end properties lie within the upscale gated communities of Privatopia, they pose a risk for their HOAs as well since these "walk away" homeowners will have no qualms about also walking away from their HOA assessments.

East Bridgewater condo association learns hard lesson

EAST BRIDGEWATER —
Residents of Hillcrest Village in East Bridgewater learned a hard fiscal lesson when they let one person control the condo association’s money.
The group’s former treasurer, Edward M. Richards, 55, is now charged with embezzling $102,000 from the association.
“To let one person control the money is a horrible idea,” said Bob McBride, CEO of the Dartmouth Group, a condo and property management company based in Bedford, “because people don’t ask the right questions.”
The safest bet for associations – and other groups – is to have more than one person watching the books and sharing responsibility for the money.
“When it comes to finances, you absolutely need to go with a management company,” said Pamela Brown, a unit owner and former condo association trustee at another complex.
Brown is a 27-year resident of Pomponoho Pines Condominiums in East Bridgewater – a 128-unit complex just yards from Hillcrest Village.

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I am gobsmacked! There must be something in HOA waters that addles people's thinking.

Millions of dollars have been embezzled by management company employees. As long as HOAs can operate under cover of darkness, embezzlement will be a very real part of association living.

National Anthem a no-go at La Casa

Residents were informed through the La Casa Activity Association president Clint Van Tassell's monthly report. He wrote, "We will inform all our musical groups that if they are performing any patriotic-type routine, at the end of the dance, they are not to perform 'The Star-Spangled Banner' or 'O Canada,' but are requested to use 'God Bless America.' "
Van Tassell wrote, "It is the feeling of the Board that this covers all of the Americas adequately. It is our request that any La Casa Clubs having a musical group follow this policy."


There are many rules that some of our residents don't care for," said Activity Association secretary Dorothy Freiler Wednesday. "We tried to establish a policy without offending people. Nobody has an objection to the 'Star Spangled Banner.' "
Freiler said the songs "My Country 'Tis of Thee" and "America the Beautiful" are more "singable."
" 'The Star Spangled Banner" has a wide range of notes that some people can't reach," she said. "Other patriotic songs are more singable."

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Aren't HOAs great? They even choose your music for you so you don't have to. I feel like singing "It's a beautiful day in the neighborhood." I wonder if it is on the approved song list in my neighborhood?

Ex-Employee Gets 10 Years For $700,000 HOA Theft

HOA Thefts Raised Questions About Financial Controls

ADAMS COUNTY, Colo. -- A former employee was sentenced to 10 years in prison Wednesday for stealing more than $700,000 from homeowners associations in metro Denver.
Stacey Lynn Chevarria, who worked for Vista Management in Westminster, admitted she stole the money, authorities said. She was sentenced in Adams County District Court.
The thefts surfaced in October 2009 when Vista Management President Cindy Combs and her bookkeeper were trying to reconcile bank books and discovered money missing, police said.

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More evidence that HOAs need the power to foreclose. Heavens, if they didn't some homeowners might not pay their assessments and that justwouldn't be fair, would it?

Hmmmm, something just isn't quite clicking.

Strings put on beach-front buyouts

GALVESTON — Some West End homeowners, worried about the city’s plans for beach-front properties acquired through a federal buyout program, want the city to restrict what it does with the newly public land in their neighborhoods.As part of its agreement to buy 64 hurricane-damaged houses under the Hazard Mitigation Grant Program, the city asked those property owners to obtain releases from the homeowners associations so the city wouldn’t have to pay association fees or follow deed restrictions. Homeowners associations typically have some legal authority through deed covenants over how property is used.However, some homeowners associations are refusing to release the properties until the city agrees to leave the land as open space, City Attorney Susie Green said.

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It just keeps getting more and more interesting.

Thanks to Fred Fischer for this story.

Corolla resort manager sentenced

The property manager of a Corolla resort community has been sentenced to nearly three years in federal prison after pleading guilty to embezzling nearly $1 million from her employer.


The embezzled money came primarily from association dues and assessments collected from nearly 100 Buck Island homeowners as well as monies set aside by property owners for ongoing maintenance and repair of their homes, the release states.

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Let's see, HOAs must have the power to foreclose because without it some owners won't pay their dues which just won't be fair on the other owners. Right? But what about all the money that is embezzled from these same poor homeowners? Why is a million dollars" an isolated incident" but a couple of hundred dollars in unpaid assessments cause for foreclosure?

vLog - 29 June 2010: Homeowner's Associations - Putting the "ass" in association

http://www.youtube.com/watch?v=Lxx37s5tzdg

Interesting commentary on associations and why it is so difficult to get more homeowner friendly laws passed in Texas. Thanks to Bill Davis for the link.

In North Bay Village, Fraud and Witchcraft Haunt a Condo Building

There are lots of condo association spats and scams in the tiny, scandal-ridden hamlet of North Bay Village. Most of them are pretty boring. That's because most of them don't involve a wrathful warlock.

The situation got stranger last week when tenants found a flyer posted on every door and littering the parking lot, declaring Laracuente's enemies were "annoying bitches" and continued, "All they know how to do is create chaos. Oh, daughters of Lucifer, that ye have been born... only for procreation purposes and to favor evil. We damn our luck for these people joining our community."

Meanwhile, there has been "no maintenance, no cleaning, [and] no garbage collection" since the mystic shit hit the fan, says North Bay Village Vice Mayor Reinaldo Trujillo. "It's a mess. If this situation isn't irregular, I don't know the definition of the word."

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Ah yes, just as Zogby discovered in the CAI poll of "Happy Homeowners", all is well in condo and HOA land.

Controversy Over the American Flag

Controversy is brewing over a flag pole in Woodstock, Georgia. A homeowner is asked to take down the pole flying an American flag.

Jon Hansen has lived in Woodstock's Summerchase subdivision for a decade. The disabled army veteran and former law enforcement officer has flown an American flag outside his Summer Point Drive home since moving in.

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Here we go again. Oh, when will they ever learn?

This same issue keeps coming up over and over again. When will people, vets or plain old citizens, be allowed to live in peace in their own homes?

HOA rules conflict with energy savings

Homeowner battles HOA, wants her roof to reflect an energy-saving ethic

Zoom in on the Google Maps satellite view of University Acres in east Orlando, and the rooftops along Charlie Piper's cul-de-sac look like dark-gray, asphalt stepping stones baking in the sun.

Piper wants to change that. She wants to replace her dark roof with a white one that better reflects the sun and conserves energy inside her home.

Her homeowners association, though, disapproves.

San Diego homeowner finds naked man asleep on sofa

San Diego homeowner finds naked man asleep on sofa

SAN DIEGO (AP) -- A San Diego resident awoke to a shocking discovery: a naked stranger passed out on his downstairs sofa.

San Diego police Lt. Jim Filley says the Pacific Beach homeowner called police after wandering downstairs Sunday morning and finding the snoring man.

Filley says the naked man was drunk and thought he was in his own home in Mission Valley, some 20 miles away.

The man, whose name wasn't released, had taken off his clothes outside the house and walked in through the unlocked front door.

The homeowner declined to press charges. And since the intruder had sobered up, he was released to find his own way home.

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Hey, it's summer at the beach in one of America's best beach towns. Whaddya expect?

Don't mess with Texas: Your home is not your castle; outlaw HOAs

Chuck Bloom: It's my castle -- not an HOA's

Some state laws hold that concept to be true; it's your castle if an unwanted intruder invades your property and you use your legally registered weapon to defend yourself – even with lethal force. Even anti-gun advocates have understood such thinking.

But when the intruder goes through the courts and takes the property with a pen, it's not your castle, and you have little say about it. Because of various factors (such as the almighty dollar), that's deemed acceptable behavior.

The very existence of homeowner associations should be outlawed in Texas, but, because of the overwhelming influence of major political donors (including major Texas homebuilders, who create the HOAs), we're left to read about such travesties that befell the Clauer family of Frisco.

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I wonder if Chuck Bloom is related to John Irving Bloom aka Joe Bob Briggs, Dallas comedian and drive in movie reviewer.

(Home sells on courthouse steps for tiny fraction of value. Property owner left SOL. Media and blogosphere outrage. HOA foreclosure fu. One star. Joe Bob says check it out.)

media-ocracy

media-ocracy This is a new blog run by Anthony DiMaggio, a political scientist (and friend of mine) who has a lot of very interesting things to say about politics and the media.

ALIEN TELLS LARRY KING TO LEAVE CNN | Weekly World News

ALIEN TELLS LARRY KING TO LEAVE CNN | Weekly World News
That's the only possible explanation.

Let record show: Blago an equal-opportunity disparager :: CHICAGO SUN-TIMES :: Gov. Blagojevich

Let record show: Blago an equal-opportunity disparager :: CHICAGO SUN-TIMES :: Gov. Blagojevich
$#*+%! | If you can't say something nice...
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When you string all these bon mots together like this, it is hilarious. Until you realize that he was elected Governor of Illinois, and then re-elected.

Price cuts mount as condos linger in Chicago - chicagotribune.com

Price cuts mount as condos linger in Chicago - chicagotribune.com
A trio of condo developments — one small, one medium and one large — announced price cuts recently as the market readjusts in a post-tax credit market and lenders show their nervousness about the summer selling season.

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I guess the realtors will tell us this means it's TIME TO BUY!

A taxing dilemma: Rising property taxes are strangling some homeowners, especially the elderly (With Video)

A taxing dilemma: Rising property taxes are strangling some homeowners, especially the elderly (With Video)

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Pennsylvania is noted for its multiplicity of townships, boroughs, counties and other local government units that along with school districts make for big property tax bills.

When those taxes go up, seniors on fixed incomes feel squeezed. This cohort along with apartment building owners allied in 1978 to pass California's historic Proposition 13 to limit property taxes. That tax revolt spread throughout the nation and is a key driver of local government privatization. Will the Keystone State be the next battleground?

Don’t Know Much About History?

There’s good news for American education. About three-quarters of residents — 74% — know the U.S. declared its independence from Great Britain in 1776. The bad news for the academic system — 26% do not.

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Do you suppose Zogby polled the 26% who did not know when they conducted the CAI "Happiness" polls? Yes? No? What do you think?

Special districts also suffer from HOA-itis

It's understandable why residents want local control of fire protection, parks and water. Hundreds of special districts sprouted across California to provide such services.

But there's a disturbing downside to the proliferation of all these fiefdoms, particularly independent special districts that have their own elected boards and run their own affairs.

As the 2009-10 Sacramento County grand jury's final report laid out in excruciating detail, because so many operate outside the same kind of public scrutiny trained on city councils and county boards of supervisors, there's an appalling lack of financial transparency, accountability and oversight.

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Special districts have been suggested as public alternatives to private local HOA government. Unlike HOAs organized under state corporation codes, special districts are governmental entities authorized by state government codes. As this Sacramento Bee editorial points out, however, special districts often lack an open, responsible and accountable governance ethic and require better oversight. Notably, the editorial describes special districts as fiefdoms, a term often applied to HOAs.

This suggests that the smaller and more local a form of government, the more likely cult of personality instead of rule of law will be the predominating governing standard. Since they are small, they are more able to hide in the cracks and avoid the disinfecting sunlight of public and media scrutiny.

It's worth bearing in mind for those seeking an alternative to private local government. Ditto for those who contend smaller government is closer and thus more accountable to its constituents. In theory perhaps but not necessarily in practice.

Payback Time - Budget in the Red, Illinois Has Stopped Paying Bills - NYTimes.com

Payback Time - Budget in the Red, Illinois Has Stopped Paying Bills - NYTimes.com

For the last few years, California stood more or less unchallenged as a symbol of the fiscal collapse of states during the recession. Now Illinois has shouldered to the fore, as its dysfunctional political class refuses to pay the state’s bills and refuses to take the painful steps — cuts and tax increases — to close a deficit of at least $12 billion, equal to nearly half the state’s budget.

Then there is the spectacularly mismanaged pension system, which is at least 50 percent underfunded and, analysts warn, could push Illinois into insolvency if the economy fails to pick up.

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And I sincerely believe that the Illinois "dysfunctional political class" will not do anything to pull the state out of its death spiral.

State and local gov't workers' job security fades

State and local gov't workers' job security fades

States and municipalities are facing gaping budget gaps. Many have responded by slashing services, raising taxes and, for the first time in decades, making deep job cuts.

And public employees should brace themselves: Some economists say the job cuts could worsen in the second half of the year.

Counting companies that work with state governments, a total of 900,000 jobs could be lost to states' budget shortfalls, according to the Center on Budget and Policy Priorities, a think tank in Washington.
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Certainly private local government -- mandatory membership property owner associations -- has been adversely affected by the economic downturn as chronicled in the many posts to this blog over the past couple of years. As Evan McKenzie pointed out On the Commons last weekend, precisely because it's private government, there's little publicly available data on associations that makes it difficult to quantify how the recession has affected them.

There's evidence that the economic downturn isn't affecting public and private local government evenly. Texas attorney David Kahne notes in an item I posted earlier this week that economic pain in Privatopia has translated into economic gain for association management and law firms foreclosing on association properties in arrears on HOA assessments. My guess is county tax collectors conducting tax sales to recover delinquent property taxes aren't making much if any money on these sales.

Local HOA's creative way to make money

Kara Kostanich
BOYNTON BEACH---A Boynton Beach Homeowners Association will soon be making money from a neighborhood foreclosed home.

President of Los Mangos Properties Owners Association Kathleen Dougherty said, "it will go back to the people and it will go back to the people and it will be spread throughout the community to pay our bills."
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What a concept! By the sounds of things HOAs can either fine people to balance their budgets or rent out foreclosed property and collect the rent.

Is it time to ask whether or not this idea of forced communal living is viable and worth preserving?

Genetic Secrets of Living to 100

A massive genetic study of people who lived for more than 100 years has found dozens of new clues to the biology of aging.

--“It shows that genetics plays an extremely important role at these extreme ages. And it begins to be a not-unsolvable puzzle,” said Boston University gerontologist Thomas Perls. “If we start looking at these genes and what they do, we better understand the biology of extreme longevity.”

--People who’ve reached that mark tend to have lives that are not only exceptionally long, but unusually healthly. Unlike most people, they rarely develop diseases of aging — such as heart disease, metabolic disease, cancer and dementia — until well into their 90s. They’re also more likely to bounce back from disease, rather than entering a spiral of declining health.
That manner of aging is a goal for most people, and a public health necessity. Modern medicine has had success in slowing individual aging diseases, but when one is postponed another soon emerges. Americans are living longer but not healthier.

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I wonder if the scientists will look into the effects of HOA living on longevity?

The big question, in my mind though is whether it is worth living to a ripe old age if it meant being stuck in an HOA ?

Public local government beats private local government -- but sometimes it's like an HOA

Grand Jury Blasts City Council

“Major changes” are needed to a South Lake Tahoe City Council that is constantly bickering, routinely drops controversial issues, and operates at a “barely functional level,” according to the 2009-2010 El Dorado County grand jury report.

— “Constant hostility and bickering among members of the City Council and their unprofessional conduct has resulted in a consistent 3/2 split vote creating two 'camps' of Council members. The voting often appears to be the result of Council members pursuing personal agendas rather than operating in the best interests of the City. The bickering and nitpicking between Council members during meetings, combined with hostile comments to media outlets and behind the scenes ‘back biting' has resulted in the failure to address routine and important business entrusted to the Council by the citizens of the City of South Lake Tahoe.

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Private government such as employed by mandatory membership homeowner associations is a non sequitur. Americans see local government as a public function and expect it to be transparent and accountable. Privatizing government through nonprofit corporation law creates an inherent contradiction and uses the law in a setting in which it was never intended to operate.

Unlike private HOA government, public forms of local government have a well established governance culture and are generally served by experienced, well trained professional staff. By contrast, HOAs are governed by property owners who are typically reluctant volunteers who muddle along from year to year. Turnover is high among board members and contracted, part time professional advisors who may or may not place the HOA's best interests first. This governance gap, I believe, accounts for much of the dsyfunction and abuse of power in HOA governance at the same time HOAs have become deeply ingrained in the structure of local government as the owner of this blog has noted.

That said, public local government isn't perfect. Sometimes their elected bodies resemble amateurish HOA boards as this story out of South Lake Tahoe, Calif. illustrates. However, no grand juries investigate HOAs and issue recommendations on how they can improve such as is the case here.

Missing Links

Sorry folks, I thought I had provided a hyperlink in the titles to the articles I posted. Here they are:

William Gammon: Prosecutor's Not Happy The Accused Child Porn User's Out On Bond
http://blogs.houstonpress.com/hairballs/2010/06/gammon_child_porn.php

Group Hit In 'Hebrew Race' Discrimination Case
http://www.thebostonchannel.com/mostpopular/24094600/detail.html

Bushnell on the Park Condominium Association placed in receivership
http://www.hartfordbusiness.com/news13775.html

Group Hit In 'Hebrew Race' Discrimination Case

A civil rights trial against a homeowner's association accused of discriminating against Jewish members has ended in a settlement that is believed to be the largest in Plymouth County history.

The jury awarded the Prescotts $600,000 for the violations of their civil rights and an additional $150,000 for nuisance. Together, with interest, the judgment is in excess of $1.2 million.
The jury awarded Scott J. Hyman $850,000 for the violations of his civil rights and an additional $100,000 for nuisance. Together, with interest, the judgment is in excess of $1.3 million.

In addition, within weeks of an association member's comments that "someone is going to burn him (Hyman) out," Hyman’s home in Middleboro, Mass., was torched and burned to the ground, according to Minchoff. There is an ongoing arson investigation.

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I am guessing Zogby never polled the Prescotts or Scott Hymen to find out if things were going well in their neighborhood and if they were happy with the HOA.

William Gammon: Prosecutor's Not Happy The Accused Child Porn User's Out On Bond

William Gammon, the attorney who's pushed for aggressive homeowners' associations in court and in the legislature, is out on bond on charges of possessing a pornography stash described by an investigator as "one of the largest collections of extremely young children he had ever seen."

According to the [ICE] special agent, Gammon's collection consisted primarily of young males and females under the age of 12, with many being infants 2 to 3 years old. The images and videos showed the young males and females, some as young as 3 months, being vaginally and anally penetrated, bound, gagged, and bleeding from their orifices. One particular image showed a 6 month old female on her back, with her hands and feet bound, a red gag in her mouth, her genitalia spread, and a message written across her abdomen saying "lick me here," with an arrow pointing to her genitalia.

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Oh, how absolutely horrible. It is sickening, really sickening. How can people do that to children?

Bushnell on the Park Condominium Association placed in receivership

"It is the first time, to my knowledge, that a receiver has been appointed for a condo association in Connecticut," Starble said. "It is an extraordinary measure, but it was made necessary by extraordinary circumstances. My clients applaud the court's decision to provide an equitable temporary remedy for home owners who have been the victims of egregious breaches of fiduciary duty. As a result of the actions of Bushnell Regency, the Association finds itself in financial distress and with a building in disrepair. To be clear, this situation is not a result of the economy; it is a result of one company's actions."

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Protecting property values, I presume.

http://theweek.com/article/index/204550/the-illegals-russian-spies-living-in-america

It sounds like the plot of a Cold War thriller: Russian spies living in the suburbs, using invisible ink, code names and "dead drops." The FBI says it's been going on for years.
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I wonder if this alleged plot of suburban Soviet-style espionage involved penetrating the HOA power apparatus to get a real insider view of how local government is increasingly organized in the U.S.A.

http://www.gpb.org/news/2010/06/29/not-so-neighborly-associations-foreclosing-on-homes

David Kahne, a Houston lawyer who advises homeowners, says that in Texas, the law is so weighted in favor of HOAs, he advises people that instead of hiring him, they should call their association and beg for mercy.

"I suggest you call the association and cry," he says.

If a homeowner misses a couple of association dues payments, the s250 or s500 they owe often becomes s3,000 after the association's lawyers add their legal fees, Kahne says.

It's not the HOA that has to pay the lawyer's bill but the delinquent homeowner. If the homeowner wishes to contest and loses, the owner is on the hook for legal fees that could run deep into the tens of thousands of dollars.

Kahne says that as the economy has gone under, HOA management companies and lawyers have been making millions off homeowners through this foreclosure process.

"We're having literally thousands of lawsuits filed over very small amounts of money," Kahne says. "And those very small amounts of money rapidly become large amounts of money when the association attorneys add their bills."

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These are the worst of times and the best of times in Privatopia, USA. Texas attorney David Kahne reports as the HOA foreclosure machine grinds up delinquent homeowners and auctions off their properties for a relative pittance, the community association industry is enjoying a bonanza of legal and other fees. And as with mortgage lenders, homeowners in arrears can only beg for forbearance since they don't have the law on their side in most states that allow nonjudicial foreclosure by HOAs, Kahne notes.

Kagan Declines To Say Gov't Has No Power to Tell Americans What To Eat

Welcome guest blogger Fred Pilot

I am pleased to welcome Fred Pilot as co-guest blogger (with Shu Bartholomew) during my more-or-less absence for vacation. Fred has been sending me articles practically daily for years, and he is one of the most knowledgeable and perceptive people you can find anywhere on these issues. I am honored to have Fred on board.

Thanks, Fred and Shu!

Welcoming guest blogger Shu Bartholomew

On July 1 I will be leaving on vacation with my three children and we will not be back until around July 21. We will be camping in Bryce Canyon National Park in Utah, visiting San Francisco, and doing other fun things. It will be hard for me to stay current on this weblog, so Shu Bartholomew has graciously agreed to serve as a guest blogger while I am away. I will contribute whenever I have the time and an internet connection, but it is hard to say how often that will be. 

Shu, as most of you know, is the creator and grand empresario of On the Commons, the weekly radio show that has featured just about everybody who knows anything about common interest housing.  Thanks, Shu!

Gated communities have ways of getting their fees | PoconoRecord.com

Gated communities have ways of getting their fees | PoconoRecord.com

A Pocono Country Place considered the Sterlins delinquent on all properties and deactivated gate passes held by all of their renters.

It meant that tenants had to go into the community office and register every time they wanted to get through the gate. As a result, many tenants moved out. In Monroe County Court, the Sterlins claimed a loss of $60,000 in rental income and complained that the community wrongfully interfered with their contractual relations with tenants.

Private communities can exert invasive pressure unmatched by municipal tax collectors.

Associations without gates often deny delinquent owners access to amenities such as a pool or other recreation services. Some communities change the key to an owner's mailbox.

At least 56,422 homes are within the borders of private community associations in Monroe and Pike counties. Homes in private associations, some gated, many ungated, account for 38 percent of all housing units in Monroe County and 64 percent in Pike County, according to county and U.S. Census data.

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Thanks to Cynthia Stephens for this link.

Bill gives more rights to Illinois common interest communities - chicagotribune.com

Bill gives more rights to Illinois common interest communities - chicagotribune.com

Common interest communities, which usually are town house or single-family home associations, have been governed primarily by their declarations and Sections 18.5, 18.6 and 18.7 of the Condo Act. Some declarations are more comprehensive and owner-friendly than others.

The new legislation, also known as SB-3180, outlines procedures and requirements for association governance and operations. It passed both chambers of the General Assembly last month and awaits the signature of Gov. Pat Quinn. It becomes effective upon signing.

"The bill is condo-like," said association attorney Michael C. Kim of Chicago. "It's a slimmed-down version of the Condo Act, but it's not the same."

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The idea is to give more protection to owners in HOAs. Section 18.5 of the condo act covers non-condo associations, but it is a bare-bones section. This is more specific and has more protection for unit owners in certain areas, such as access to records, meetings, and assessment increases.

With the clock ticking, Sacramento set to blow another budget deadline - ContraCostaTimes.com

With the clock ticking, Sacramento set to blow another budget deadline - ContraCostaTimes.com

SACRAMENTO — Most of us get in trouble when we're late. If you don't bring back a library book on time, they fine you. Miss a court date, and count on a warrant with your name on it.

But not California's political leaders — at least not when it comes to passing a budget. Wednesday marks the last day of the fiscal year — the day the state constitution says a budget must be in place. Yet, for the 17th time in the past 20 years, lawmakers and the governor will find themselves bickering well into the summer — and busting their deadline.
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This is happening all over the nation now. State and local governments just ignore the laws that limit their power. Does that mean they are becoming more like HOAs and condo associations, or is it the other way around?

Liveblogging the final four USSC decisions now on SCOTUSBLOG

Here is the link to SCOTUSBLOG, where an able team of USSC litigators will be live blogging the announcement of the last four USSC decisions of the term in 15 minutes or so--including McDonald v. City of Chicago, that will determine whether the Second Amendment right to keep and bear arms applies to the states.

Public finances: Can pay, won't pay | The Economist

Public finances: Can pay, won't pay | The EconomistThis article from The Economist compares and contrasts deadbeat American states, such as Illinois, with deadbeat nations like Greece. Thanks to Doug Selby for the link (and for the picture of the rattlsnake he dispatched today on his ranch).

FT.com / US / Economy & Fed - US state budget crises threaten social fabric

FT.com / US / Economy & Fed - US state budget crises threaten social fabric
This is from the Financial Times, a publication not given to panic or exaggeration.

RealClearMarkets - Is Illinois the New California?

RealClearMarkets - Is Illinois the New California?
As of Monday, the credit default swap spread for Illinois general obligation bonds climbed to 313 basis points for a five-year contract -- meaning a bondholder must pay over 3% of the bond's face value per year to be insured against default.

That's a higher price than for all but seven sovereign entities tracked by CMA, and slightly higher than California, whose five-year CDS spread sits at 293. Investors rate Illinois's debt as slightly riskier than Iceland's or Latvia's, but not quite as big a gamble as Iraq's.
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This is an essay by Josh Barrow that was cited in a Chicago Tribune editorial (one of many) pointing out that the State of Illinois is in a terrifying downward financial spiral that places it, in terms of the risk of defaulting on its public debt, worse than Portugal and California, and just below Dubai and Iraq. The data on government probability of default can be found here. What I find disturbing--above and beyond the desperate situation this state is in--is the la-de-da attitude that prevails everywhere in elite circles except the editorial board of the Trib. The public can't be bothered, of course. When I bring this up in conversation with anybody I feel like one of those scientists in the movies who keep ranting about how Planet X is going to crash into the earth, and people just say, "Yeah, sure, but how about the Cubs?"

And of course, California is on it's own path to perdition, but as the Barrow article notes, California's public pension plans are not as badly underfunded as those in Illinois. Here's a taste from the Barrow article about how bad this is: Illinois's pension funding irresponsibility may come home to roost soon. Joshua Rauh, a professor at Northwestern University, estimates that the state's pension funds will run out of money in 2018 at the current funding pace. "He estimates the plans' total funding gap at $219 billion -- a liability that dwarfs the $117 billion in bonds outstanding from the state and localities within it."

That's $219 BILLION DOLLARS.

Tiny prefab units promote eco-friendly building

Tiny prefab units promote eco-friendly buildingZeta Communities will construct the housing for the 22-unit developments, planned for parking lots in Berkeley and San Francisco. The projects will feature tiny living spaces - 310- to 340 square-foot studios - and no parking. Instead, they will include a car-sharing space.

The proposed four-story projects are the first foray into prefabricated housing for East Bay developer Patrick Kennedy of Panoramic Interests.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/05/18/BUCG1DEGD3.DTL&type=realestate#ixzz0s4KnkW7R

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How lovely. A 310 square foot condo with no parking. And all for only $200-$275K.

On The Commons

On The CommonsOn The Commons turns 10 years old this month. Our special guest is Evan McKenzie as we celebrate 10 years and kick off a brand new season of On The Commons.
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Give it a listen and post a comment telling us all what you think...

Breezy summer reading about associations just a click away - chicagotribune.com

Breezy summer reading about associations just a click away - chicagotribune.com
privatopia.blogspot.com: The Privatopia Papers runs headlines and links to news stories about dreary financial reports, dubious legislation and homeowner associations behaving badly. Attorney Evan McKenzie, a political science professor at the University of Illinois at Chicago, offers snarky commentary along with explanations of the finer points of law and governance.
Get the Chicago Tribune delivered to your home for only $1 a week >>

In one post, a Baltimore association proposed DNA-testing of its resident dogs to determine which owners aren't cleaning up after their pooches. McKenzie assured his readers the story was not something invented by The Onion, a satirical news source.

"It is no longer possible to parody the antics of homeowner association boards because no matter how absurd the concept you come up with, they have all ready exceeded it," he wrote.
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Thanks to Pam McKuen for including this blog among the cool summer readings on HOAs. She gets my vote for most knowledgeable journalist on this subject (and not because of this article!) Hey--am I snarky? I thought I was just realistic...

Lawmakers to talk about severing Lake Michigan from Mississippi River to halt carp - chicagotribune.com

Lawmakers to talk about severing Lake Michigan from Mississippi River to halt carp - chicagotribune.comA century ago, reversing the Chicago River and building a complex system of channels to steer sewage away from Lake Michigan was considered one of the great engineering feats in world history.

As concerns mount about Asian carp, momentum is building to re-engineer Chicago's waterways to allow for the passage of boats and ships, but not harmful invasive species.
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Reversing the direction of the Chicago River was one of the greatest engineering feats in American history, considering it was done between 1889 and 1900. Now, with every Illinois government insolvent, from the state down to the local mosquito abatement district, the plans are being proposed to do something equally grandiose. And all because of a fish. Last time at least it was because of...well, never mind.

Some California fire departments billing after accidents - Sacramento Living - Sacramento Food and Wine, Home, Health | Sacramento Bee

Some California fire departments billing after accidents - Sacramento Living - Sacramento Food and Wine, Home, Health | Sacramento Bee
More than two dozen fire agencies, struggling for ways to boost sagging budgets, have begun tallying service charges at crash sites and sending bills to drivers or their insurance companies.

Is a pumper truck called to the scene? That'll be $400. Traffic cones and flares needed? Another $20. An incident commander to oversee? That's $75 an hour.

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As I was saying on "On the Commons" today, local governments are clever about finding ways to make up for lost revenues. Whenever state legislatures and voters try to make them cut back, they find new way to raise money. CIDs, which are now the lowest level of local government, are one of those fiscal tools used by cities and counties. People who think that CIDs will replace local governments are missing the big picture--CIDs are the lowest and most vulnerable level of local government. Their supposedly "private" nature is just a legal fiction that allows them to get away with things public governments can't do.

Durbin asks Obama to appoint carp czar - Chicago Breaking News

Durbin asks Obama to appoint carp czar - Chicago Breaking News As concerns mount about the presence of Asian carp near Lake Michigan, U.S. Sen. Dick Durbin today urged President Obama to appoint a carp czar to oversee efforts to keep the invasive species out of the Great Lakes.

"We need to have one person who coordinates the efforts of the federal, state and local agencies that are doing everything they can to keep the Asian carp out of Lake Michigan," Durbin said during a news conference at the Shedd Aquarium. "We believe it's absolutely essential."

Durbin was responding to the discovery of a bighead carp, a variety of Asian carp, during routine sampling this week in Lake Calumet, just six miles from Lake Michigan. Standing beside environmental advocates who have championed closing Chicago-area locks as a way to prevent carp from entering Lake Michigan, Durbin called the finding a possible "game changer" and said "we have to take it very seriously."
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Durbin wants a czar so the President will have ultimate control over what happens to Illinois shipping in the Chicago River. He has been trying to prevent anybody from interfering with the status quo--an obviously ineffective system that is allowing the carp to move up the river toward Lake Michigan. Durbin thinks Obama will look out for the local economic interests, which are substantial. Durbin is afraid the Supreme Court or even Congress (imagine them actually solving a problem!) will effectively close the canal and river system down to prevent these nasty carp from wrecking Lake Michigan and then the rest of the Great Lakes.

The Supreme Court refused to rule on this twice in the last term. Big mistake, in my opinion. These Asian carp are a destructive invasive species. We were looking at them yesterday in the Shedd Aquarium in Chicago. Weird things, with eyes below the midline of their bodies--constantly sucking in water and eating the plankton. They grow at an incredible rate and if they kill the bottom of the food chain, the Great Lakes will never be the same.

Court Upholds St. Louis’s Attempt to Suppress Eminent Domain Protest Mural | Institute for Justice: Litigating for Liberty

Court Upholds St. Louis’s Attempt to Suppress Eminent Domain Protest Mural | Institute for Justice: Litigating for LibertyArlington, Va.—The right of free speech suffered a blow today when a federal court upheld St. Louis’s attempt to suppress activist Jim Roos’s mural protesting the city’s abuse of its eminent domain power.
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Thanks to Mystery Reader for this link to the Institute for Justice website (the property rights law firm), where you can read about the battle over Jim Roos's "End Eminent Domain Abuse" mural. The struggle over municipal use of the eminent domain power looks like a lasting issue. There are several areas where property rights activists, and many citizens, want reform.

First, there is the issue of what constitutes a taking. There are what we call "regulatory takings," where the city doesn't actually condemn the land and pay you for it, and instead they just pass regulations that restrict your use of the land so heavily that it loses much of its value, and for all practical purposes the city might just as well have taken it from you--without paying for it.

Second, there is the the Kelo v. City of New London issue: what are the limits of the "public use" condition in the due process clause? The Kelo decision upheld the right to take property from one private party and practically give it to another private party (in that case, Pfizer Corporation) in order to enhance tax revenues and stimulate economic development, even though there was no public use. Most states passed reform legislation to limit that sort of taking, but UIC Political Science graduate student Tom Kelly wrote a dynamite dissertation showing that this legislation has been ineffective (I was on his committee).

Third, what kinds of property interests can be taken? Does it have to be physical property, or can intangible property interests be "taken" and thus require compensation?

Stone Oak resident claims HOA harassment over porch gate to protect autistic son | kens5.com | San Antonio News, Weather, Sports, Traffic, Entertainment, Video and Photos

Stone Oak resident claims HOA harassment over porch gate to protect autistic son Christa says Luke would run out of the house and into the street just about every day. He came close to being run over by a car on a few occasions.

So Christa says she decided to do something about it. The Colquhouns filed an application with the Panther Creek at Stone Oak Homeowners Association asking to build the gate.
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And, she says, the HOA let 60 days go by without responding, so they built the gate. And then somebody complained to the HOA, who demanded that she remove it, complete with the usual threats of litigation.
Thanks to Fred Pilot for another example of the kind of thing that, according to the industry, hardly ever happens.

China's Desert Ghost City Shows Property `Madness' Persists - Bloomberg

China's Desert Ghost City Shows Property `Madness' Persists - BloombergInvestors are stockpiling empty apartments because there are few alternative investments, undermining government efforts to deflate a property bubble, said Patrick Chovanec, an associate professor at Tsinghua University in Beijing.

“Money is being dumped into property because there are no alternatives,” said Chovanec, adviser and former vice president of the Hong Kong venture capital firm Asia Mezzanine Capital Group. “Policy makers are nibbling around the edges of the core problem.”
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A bursting real estate bubble in China? That would be interesting.

Meredith Whitney Predicts Double Dip in Housing Market: Is She Right?

Meredith Whitney Predicts Double Dip in Housing Market: Is She Right?
Well, I think she's right.

New-home sales plunge 33 pct with tax credits gone - Yahoo! Finance

New-home sales plunge 33 pct with tax credits gone - Yahoo! Finance
Sales of new homes collapsed in May, sinking 33 percent to the lowest level on record as potential buyers stopped shopping for homes once they could no longer receive government tax credits.
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The smoke and mirrors economic policy is collapsing.

Maywood, CA Plans To Disband ALL City Services

Maywood, CA Plans To Disband ALL City Services The small city of Maywood south of downtown Los Angeles plans to lay off almost all its employees, disband its police department and contract municipal operations to a neighboring city.

Facing a budget deficit of at least $450,000 and unable to get insurance because of a history of lawsuits, many involving the police department, the Maywood City Council said Monday night it had no choice but to adopt the plan.
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The article says this is "unprecedented" in California.

Housing Starts Drop in May; Producer Prices Dip - WSJ.com

Housing Starts Drop in May; Producer Prices Dip - WSJ.comU.S. home construction plunged in May as builders remained cautious about sales prospects absent government support programs for the housing sector.

Housing starts dropped 10% the month after the government ended its tax-credit program for home buyers, to a seasonally adjusted annual rate of 593,000. Permits for new construction also declined, the Commerce Department said Wednesday. Single-family housing starts slid by 17.2% to an annual rate of 468,000, the lowest level in a year.
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Isn't it clear by now that this all this federal "stimulus" spending is a failure? Short term gain followed by bust, and more debt accumulated that has to be paid off. Where does it end? Apparently the White House doesn't get it. Now they say that we need to take another $50 billion out of the deep end of the pool and pour it into the shallow end to bail out state and local governments. And after that runs out, then what?

UPDATE 2-Fannie Mae, Freddie Mac to delist shares on NYSE | Reuters

UPDATE 2-Fannie Mae, Freddie Mac to delist shares on NYSE | ReutersJune 16 (Reuters) - Fannie Mae (FNM.N) and Freddie Mac (FRE.N), the largest U.S. home funding companies, will delist their shares on the New York Stock Exchange after failing to meet minimum trading price requirements, the companies' regulator said on Wednesday.

The companies, each taken under government control in September 2008, said they no longer met NYSE listing standards and that shares would trade in the over-the-counter market.
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This housing recovery is just rocketing along.

FDIC's Bair questions housing tax breaks - Street Sweep: Fortune's Wall Street Blog

FDIC's Bair questions housing tax breaks - Street Sweep: Fortune's Wall Street BlogBair took aim at federal tax deductions for mortgage interest, local property taxes, and capital gains on house sales (in certain circumstances). She said these taxpayer subsidies for homeowners, taken together, "are about three times the size of all rental subsidies and tax incentives combined."
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Why don't we just put all our money in a paper bag and send it to President Obama to do with as he sees fit?

the-housing-market-recession-is-not-over: Personal Finance News from Yahoo! Finance

the-housing-market-recession-is-not-over: Personal Finance News from Yahoo! FinanceIn a presentation to the National Association of Real Estate Editors in Austin, Texas, last week, Stan Humphries, Zillow.com's chief economist, pointed to four myths he said consumers are latching on to as they try to make sense of recent housing statistics.
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Myths, says he:
1. the housing recession is over
2. after markets hit bottom, prices will rebound to boom levels
3. the worst of the foreclosure mess is behind us
4. the tax credits saved the housing market

New Home Sales Set to Plunge in Former Bubble Markets (Update1) - Bloomberg.com

New Home Sales Set to Plunge in Former Bubble Markets (Update1) - Bloomberg.comNew home sales in Phoenix and Las Vegas, two U.S. markets hardest hit by foreclosures, are set to plunge as a federal tax credit for homebuying expires, according to data from real estate researcher Metrostudy.
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Possibly an infusion of mud and golf balls would help.

Soldier in Iraq Loses Home Over $800 Debt | Mother Jones

Soldier in Iraq Loses Home Over $800 Debt | Mother JonesMichael Clauer is a captain in the Army Reserve who commanded over 100 soldiers in Iraq. But while he was fighting for his country, a different kind of battle was brewing on the home front. Last September, Michael returned to Frisco, Texas, to find that his homeowners' association had foreclosed on his $300,000 house—and sold it for $3,500.
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Here's another one of those "isolated examples."

Bankruptcy talk spreads among Calif. muni officials | Reuters

Bankruptcy talk spreads among Calif. muni officials | ReutersStreet expects more talk of municipal bankruptcy across California because local government finances are in such dire shape -- a situation underscored on Wednesday when a top finance officer for Sacramento County projected a worse-than-expected shortfall for the county of $181 million, which could force more than 1,000 layoffs from the county's payroll.
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That's peanuts. Illinois is in the hole to the tune of $80 billion just to the state employee pension funds.

US money supply plunges at 1930s pace as Obama eyes fresh stimulus - Telegraph

US money supply plunges at 1930s pace as Obama eyes fresh stimulus - TelegraphThe M3 money supply in the United States is contracting at an accelerating rate that now matches the average decline seen from 1929 to 1933, despite near zero interest rates and the biggest fiscal blitz in history.
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This recovery is just rocketing along.

Renewed effort in Austin to limit HOA powers | kvue.com | KVUE News local | Austin, Tx | Breaking news

Renewed effort in Austin to limit HOA powers | kvue.com | KVUE News local | Austin, Tx | Breaking news"You don't seize someone's home that's entirely paid off for a few hundred dollars in back dues," said State Rep. Chris Turner (D-Dist. 96). "That's fundamentally unfair and not right."

Turner is the latest state legislator to tackle HOA reform, and on Monday, he recruited Sherre Mueller to join his fight.

"I want to be an advocate for people to never let this happen again," she said.

State lawmakers have tried unsuccessfully to reduce the powers of HOAs for years. In 2009, two proposals in the House and Senate ran out of time.

Turner would like to add two major safeguards to the law, including one that would make it impossible for an HOA to foreclose without a court order.

He also thinks members of an association — your neighbors — should have the final say and vote whether to seize a house.
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Thanks to Fred Pilot for this link to yet another cavalry charge in the TX legislature.

KOB.com - Homeowner faces fines over 'for sale' sign in yard

KOB.com - Homeowner faces fines over 'for sale' sign in yardA Rio Rancho homeowner is facing hundreds of dollars in fines for putting up a "For Sale" sign in his own front yard. Geoffrey Padilla, who lives in Diamond Ridge, said his homeowners association fined him $400 over the past few months. He said the the association handbook bans signs and billboards, including "For Sale" and "For Rent" signs. Padilla said the policy went into effect several weeks after he bought his home, so he thinks the fines should be waived. He also said he thinks the policy is unfair because the subdivision's developer, D.R. Horton Homes, posted similar signs throughout the neighborhood. Padilla claims the builder encouraged the homeowners association to enforce the policy because it doesn't want competition from homeowners.
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From Fred Pilot--and keep in mind that municipalities can't ban all signs under the Supreme Court decision of Ladue v. Gilleo, but even Ladue didn't ban "for sale" signs. That was covered by the earlier decision of Linmark Associates v. Willingboro. This is one of those "get away with violating constitutional rights if you are a pseudo-private corporation" kind of things.

I-Team: Homeowners Hammered with HOA Arbitration Fees - KLAS-TV Channel 8 News Las Vegas

I-Team: Homeowners Hammered with HOA Arbitration Fees - KLAS-TV Channel 8 News Las VegasIn July of last year, a dispute over a budget ratification meeting went to non-binding arbitration under the Nevada Real Estate Division. It's a mandatory first step before going to court. Friedrich lost, and to the victor went the spoils. He was ordered to pay $22,000 in arbitration and attorneys fees. "I was expecting the worst, and the worst came true," he said.

Friedrich responded with a lawsuit challenging the arbitrator's authority to impose attorney's fees. It is a common practice among arbitrators selected by the Real Estate Division. Records obtained by the I-Team reveal a dozen recent awards in excess of $10,000 against homeowners. Some awards were as high as $20,000.
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Fred Pilot sent this along, which we are talking about even though it happened in Vegas. This is a big issue. The whole idea of ADR is to cut costs. If lawyers can make five figures off it, courtesy of the "arbitrators," it makes you wonder if the process is just another lawyer-driven arm of the industry.

Homeowner won fight over HOA foreclosure

Homeowner won fight over HOA foreclosure

What are the large barcode stickers on windows on cars in Florida?

What are the large barcode stickers on windows on cars in Florida?
The answer seems to be that they get your car through the gates of your gated community. Maybe the unit owners should get bar codes tattooed on their foreheads as well. That would simplify getting back in if you go for a walk outside the compound.

Toms River, condo association at odds over fence around beach | APP.com | Asbury Park Press

Toms River, condo association at odds over fence around beach | APP.com | Asbury Park PressTOMS RIVER — Though township officials contend a condominium complex has violated municipal ordinances by building a fence around its private beach, condo association leaders say it's a simple misunderstanding.
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Seems the township leases the beach from the condo association and didn't do so this year. So the condo association decided to fence it off to keep out the Jersey Shore riffraff.

Problem: the condo association didn't get a construction permit before building the fence.

How's that for irony?

Weak strata laws favour developers

Weak strata laws favour developersThe unchecked ability of a B.C. strata developer to ignore the Strata Property Act, fail to maintain reserves, fail to pay strata fees on unsold strata lots and use its block of votes from unsold strata lots to corrupt governance for the developer's benefit are all too common in British Columbia.

In the absence of any defined offences and penalties under the Strata Property Act, a developer is subject only to civil action by the "empty-pocketed" strata buyer, a virtual impossibility.

Read more: http://www.timescolonist.com/Weak+strata+laws+favour+developers/3060211/story.html#ixzz0ofKlUv7p

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A familiar story, this one from Canada, where condos are called "strata property."

Condos and HOAs | Sun-Sentinel.com

Condos and HOAs | Sun-Sentinel.comRay says his West Palm Beach condo lease will likely not be renewed because of his daily habit of waiting outside the building on the sidewalk for about 10 minutes each day for his wife to arrive from work. As far as he knows, that is the only reason for rejection.
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This post is from a blog by Daniel Vasquez, a Florida journalist who writes a column on condo and hoa issues.

Dusting for dog-crap in a fancy condo - Boing Boing

Dusting for dog-crap in a fancy condo - Boing Boing
The condo association at Scarlett Place, a posh Baltimore building, have proposed to DNA-test all the dogs on the premises, and use DNA from errant dog-turds to identify feckless owners and fine them $500 per dog-pie.
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I told my 19 year old son about this, and he said, "That sounds like something from The Onion." Yes, it does. But it is real. It is no longer possible to parody the antics of HOA boards because no matter how absurd the concept you come up with, they have already exceeded it.

Thanks to Mystery Reader for this link. I also got it from Fred Pilot who contributed two more stories below. I have been too busy to blog for several weeks so thanks to those who sent me items--I will see about catching up.

South AfricaNews - 'They are a mafia' (Page 1 of 2)

News - Crime & Courts: 'They are a mafia' (Page 1 of 2)
It is a comfortable complex with a mix of upmarket and middle-class homes, some with views of the sea - but run by a homeowners' association from hell, say some residents.

So heated has the low-level war between residents and The Capricorn Beach Homeowners' Association (HOA) become that the association has reportedly racked up a R191 000 bill in legal battles against homeowners.
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Those R thingies are Rands. That's the currency in South Africa. According to my friendly neighborhood internet converter, R191,000 amounts to $24,227. So it seems that HOA lawyers are expensive the world around.

Homeowner Wins Court Battle With HOA - San Antonio News Story - KSAT San Antonio

Homeowner Wins Court Battle With HOA - San Antonio News Story - KSAT San AntonioHidden Forest off of Bitters Road looks quiet, but for more than three years, it's been the center of a legal battle over the rights of homeowners associations.

"They were suing to foreclose on my home over $390," said Hern.

Hern said he was late on his association dues but objected to the added fees and decided to fight. Over the years, he said the attorney's fees kept adding up.

"They were asking for a little over $25,000 in fees," he said.
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And of course now that the HOA has lost, their attorney is promising to "address this further through the legal process," which translates into litigation without limit to crush any owner who stands up for his rights.

U.S. Banks Post Profit, but Woes Persist - WSJ.com

U.S. Banks Post Profit, but Woes Persist - WSJ.com
WASHINGTON—A total of 775 banks, or one-tenth of all U.S. banks, were on the Federal Deposit Insurance Corp.'s list of "problem" institutions in the first quarter, as bad loans in the commercial real-estate market weighed on bank balance sheets.
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This recovery is going well.

Living in denial: How corporations manufacture doubt - opinion - 20 May 2010 - New Scientist

Living in denial: How corporations manufacture doubt - opinion - 20 May 2010 - New Scientist"Objective scientific research": those words would almost make you believe that Panzer was talking about objective science. But when doubt is your goal, the misuse of language is just another way to confuse the public.
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Hmmmmmmm.

Harrisburg, Pennsylvania, Council Told to Consider Bankruptcy - Bloomberg.com

Harrisburg, Pennsylvania, Council Told to Consider Bankruptcy - Bloomberg.com: "April 27 (Bloomberg) -- Harrisburg, Pennsylvania, which has missed $6 million in debt payments since Jan. 1, should consider seeking Chapter 9 bankruptcy protection, City Controller Dan Miller told a three-hour special committee hearing."
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No worries. It's only the capitol of Pennsylvania.