AB 1098 Assembly Bill - Bill Analysis
The ever-alert Fred Pilot noticed this intriguing paragraph in a bill introduced in California to improve member access to HOA and condo association records. The passage is from the arguments against the bill contained in this bill analysis:
The public policy concepts adopted by the California legislature in 1985 established CIDs to relieve the tax burden from local government. The ability to collect assessments to sustain the infrastructure was afforded as well as establishing equitable servitudes via a contract (the CC&Rs) with the owners. In doing so it (the Legislature) did not envision these volunteer driven communities to mirror government. Therefore, CIDs were not given the protection and insulation afforded to government and elected officials.
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Let's unpack this. It seems to reflect the following view: state government "established" residential private governments in 1985 so that local governments wouldn't need to raise property taxes. (Keep in mind that in 1978 Proposition 13 made it impossible for them to do so.) So, CIDs are a way for government to circumvent limits on taxation that were put in place through direct democracy. And CIDs are intentionally illiberal. You are going to get more local government whether you want it or not, and if you won't pay for it, you will get it on the cheap.
Now, keep in mind that what the voters wanted in passing Prop. 13 was a cut in property taxes through reduction in government spending. What they got was an additional level of government that is now costing them a fortune in assessments, along with a ton of headaches. Add up the property tax bill and the assessments, and then you see the real cost of local government in the post-Prop. 13 era.
And how can people continue to view HOAs as always being purely private institutions, when you read something like this? It is becoming obvious that HOAs are, in some places, an extension of the local state. They clearly have the potential to be used by government to extent it's taxing and service delivery capacity and its power--even if the voters have said, "no, thank you."
Comment?
2 comments:
You've cut to the crux of the local government fiscal policy driving the formation of CIDs:
"You are going to get more local government whether you want it or not, and if you won't pay for it, you will get it on the cheap."
That's exactly what is happening and has been widely overlooked in the debate over CIDs that too often tends to focus on community assn industry concocted canards like lifestyle choices and the preservation of property values.
There is little or no organic demand for CID housing: it is being driven by these local governments' financial needs. That's why so of them many require all new development to be of the CID variety.
The growth of CIDs is a form of revenge of local governments against the voters for approving Prop. 13 in 1978 and the property tax cuts that followed in other states. The local governments are in effect telling taxpayers if you don't want to pay for local government, then you and your fellow homeowners are on your own -- and don't come crying to us if your HOA cannot properly govern or finance itself.
In regard to the last sentence, "Therefore, CIDs were not given the protection and insulation afforded to government and elected officials.", CIDs should not be given government immunity or privileges unless CIDs are declared govenmental entities. Without such a declaration, homeowners will continue to be at the mercy of private governments without the same rights as a citizen would have to bring action against a public agency or official.
Otherwise, the state continues to grant special privileges to this class of private entity with the loss of 14th Amendment protections of homeowners.
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