NO! ON SENATE BILL 551
By Donie Vanitzian
Copyright Donie Vanitzian, BA JD
Coto de Caza , California
Homeowners do not have "stupid" written on their foreheads!
Stay out of our homes - Stay out of our wallets
Knock, Knock. · Who's There? · Fiscal. · Fiscal Who? · Fiscal Impact! Ha! Ha!
Readers should be aware that the "industries" are against Senate Bill 551 for completely different reasons than owners are. Owners have a vested interest in their property; industries doing business with associations do not.
Make no mistake, the vast majority of owners in common interest developments, are dissatisfied and disgusted with the lack of adequate disclosure laws upon purchase.
• WHAT'S WRONG WITH SENATE BILL 551? EVERYTHING.
* There is so much wrong with SB551 it is nearly impossible to set forth all the problems let alone hypothesize corrections or alternatives. One of the main problems with SB551 and the attendant Ombudsman statutes in California is: enforcing the enforcement that is impossible to enforce. You read that right. Irrespective of the bill's language using the word "enforcement" the bill has NO enforcement power in it. None. Nada. Nope. Zero. Zip.
* Through this bill and many others regarding common interest developments, the legislature has made buying, selling, owning, in such "communities" so expensive, that now only the rich can afford to stay because they can afford to pay. Presently, the majority of owners do not fully understand their rights in these developments because (a) they have no rights, and (b) the legislators keep taking what little rights that may exist, away.
• MISSES THE MARK ON WHAT OWNERS WANT AND NEED FOR "RELIEF"
* No amount of "education" can return the owners' rights to us. Only the laws can give us back our homestead rights, our due process rights, our equal protection rights and all other property rights that are taken from us with the recording of restrictions on our titles.
* Nothing will prevent or reduce the severity of problems within a common interest development as long as our legislators' doors are open to campaign contributions and influence by industries while simultaneously locking out constituents and their needs. The legislature has made the principle remedy for violations of common interest development real estate laws, "private litigation" using the mantra, "It's a civil matter." But then, on the other hand, as you will read below, our government takes even that away from us, forcing us into other lesser avenues of redress consisting of "side-courts."
• SB551 FAILS TO PENALIZE THE BOARD OF DIRECTORS
Year after year, I ask the legislature to insert a provision in the Davis-Stirling Act to PENALIZE THE BOARD. Every legislative session, this is ignored.
• SB551 IS NOT EVEN A LAW -- IT IS A PILOT PROJECT! OWNERS ARE GUINEA PIGS FOR TESTING SB551 -- IT IS AT OUR EXPENSE AGAIN
This bill is only a "pilot project" that creates a bureaucracy for one purpose: collect data and money. Period. That's it. Read: "(e) The costs of the Common Interest Development Bureau Pilot Project shall be borne entirely by common interest development HOMEOWNERS, through imposition of a biennial fee. ... There is in the Department of Consumer Affairs the Common Interest Development Bureau, under the supervision and control of the Director of Consumer Affairs.... Commencing July 1, 2007, the Director of Consumer Affairs shall employ a Common Interest Development Bureau Chief and other officers and employees as necessary to discharge the requirements of this chapter."
• LACKS ENFORCEMENT ON SEVERAL FRONTS
There are issues regarding "enforcement." (1) Ask: Who is going to ENFORCE this so-called ENFORCEABLE FINE? The police? (2) Merely stating a bill has enforcement does not make it so, when read closely, there really is NO enforcement mandated in the bill. Owners will learn that all decisions by some clerk in that bureau are APPEALABLE TO THE SUPREME COURT. Here come the ass lawyers.
• NO PLACE TO FILE COMPLAINTS AGAINST THE BUREAU
Ask: If the owner has a complaint against this bureau, "who" or "what" is the overseeing agency to take your complaint? Will there even be one? Did the legislators even think that far ahead?
• SENATE BILL 551 IS RIFE WITH LEGAL PROBLEMS
*There is not enough independent increased revenue to cover the increased expenses of such a "bureau" which is not really a bureau but instead a "bureaucracy." There are presently no funds available to launch this program.
There are not enough revenues early enough to cover front-end costs of this new public facility which is not entirely for the general "public" but instead meant only for one segment of the public, that is, those with residential deed-restricted titles. Where's the "equal protection" in that? This alone, immediately creates a negative cash flow.
There is not enough revenue available in the right places or for the right purpose that would be meant to fund this "bureaucracy." This also results in an inequitable distribution of the cost burden.
• HERE'S THE LEGISLATURE'S REASONS FOR FIRST CREATING THE OMBUDSMAN AND SECOND CREATING A BUREAU
By collecting empirical data on the nature and incidence of problems within common interest developments, the Common Interest Development Bureau provides a sound basis for prioritizing reform efforts, thereby increasing the stability of common interest development law."
• HERE WE GO AGAIN. NO DIFFERENT THAN CREATING ANOTHER HOMEOWNER ASSOCIATION ONLY THIS TIME WITH A BIGGER BOARD AND MORE BOARDS
SB551 says: "The bureau shall adopt rules governing practices and procedures under this chapter. Any rule adopted under this subdivision is subject to the rulemaking provisions of the Administrative Procedure Act."
• AND AGAIN.
SB551 says: It will "collect empirical data on the nature and incidence of problems within common interest developments, the Common Interest Development Bureau provides a sound basis for prioritizing reform efforts, thereby increasing the stability of common interest development law." THAT IS RIDICULOUS!
• AND AGAIN.
After wasting the owners' time and expending countless millions of dollars on "testing" grounds, the bill then states: "Information and advice provided by the bureau HAS NO BINDING LEGAL EFFECT and is not subject to the rulemaking provisions of the Administrative Procedure Act."
• SB551 CREATES YET ANOTHER AGENCY JUST LIKE THE CALIFORNIA LAW REVISION COMMISSION
Anyone who has ever dealt with the ineptness of the California Law Revision Commission will loathe SB551. The bill says: "The bureau may convene an advisory committee to make recommendations on matters within the bureau's jurisdiction. A member of an advisory committee may receive per diem and expenses pursuant to Section 103 of the Business and Professions Code. In selecting the members of an advisory committee, the bureau shall ensure a fair representation of the interests involved. (f) The bureau shall not provide any service that relates to an activity of a licensed real estate professional that is governed by Part 2."
• SB551'S LEGAL EFFECT IS THAT IS TURNS OUT TO BE A CONVENIENT PARKING LOT FOR COMPLAINERS AND DISSIDENTS.
This bill sends complainers into the black hole for one reason: to shut them up and there are many ways to accomplish shutting up owners once this bureaucracy is created. The effect of being mired in more paperwork, more rules, more regulations, paralyzes the owner into the 30-60-90-120 day antics consisting of nothing more than "waiting games," all are meant to further silence owners by getting them stuck in a system that CAN'T HELP THEM.
• SB551 FAILS TO CREATE A VICTIM FUND FOR INJURED HOMEOWNERS.
If the legislature wanted to help homeowners, instead of funneling all the money they will make from this stupid bill into other agency departments and industry hopefuls, that money should be funneled back to the owners who generated it. It should be used to right the wrongs committed against owners, NOT, recycled back into the state's coffers where SB551 banks the takings.
• TITLEHOLDERS WANT PENALTIES AGAINST BOARDS, NOT THE ASSOCIATION.
Owners want to hold the board of directors, and/or individual directors liable and/or responsible for wrongdoing. SB551 does not do this. It doesn't even come close. Instead, it creates many escape hatches for boards to continue on as usual and all fines or penalties if any, the "association" pays.
• GET THESE DAMN HOMEOWNERS OFF MY BACK AND OUT OF MY OFFICE -- PASS A BILL -- "ANY" BILL!
Yes, that is what one government official told me. SB551 is nothing more than a convenient parking lot for complaining homeowners. It's a luxurious new jail. It ties us up in a tidy bow and cuffs our hands and rights so as to prevent any effective action. Remember, the homeowner must pay for the privilege of being prejudiced by this system.
• LEVIES FINES AGAINST ASSOCIATION?
This bill levies fines against the association. Guess who pays the fines? The titleholders.
• ASSOCIATION IS THE STATE'S COLLECTION AGENCY
The association once again is the collection agency for the state. Because the "association" is the collection agency for the state, the amount paid is considered to be an assessment against the owner's home which can then have a lien placed against it and be foreclosed upon to collect.
• ASK:
What's wrong with a bill that terms itself out on "January 1, 2012?" This is the first clue this bill was in trouble.
• "AMONG OTHER THINGS."
How can anyone express confidence in a bill that uses nebulous and unclear, language like that? What the hell is the LEGAL DEFINITION of "among other things?"
• NO SUCH THING AS A FREE LUNCH.
Watch all statute language using the word "REQUIRES." SB551 says: "Requires the bureau to offer training materials and courses to common interest development directors, officers, and owners, in subjects relevant to the operation of a common interest development and the rights and duties of an association or owner. The bill would require the bureau to maintain a toll-free telephone number and Internet Web site for purposes of further providing that information and assistance, and would require an association director or agent to meet certain requirements in that regard."
• REQUIREMENTS MEAN REQUIREMENTS FOR OWNERS TO PAY AND FUND.
Now, not only will owners be responsible for funding their association's coffers, guess what? You will now be funding this porked up agency's coffers! The bill would REQUIRE the bureau, upon request and within the limits of its resources, to investigate and assist in resolving any dispute involving the law governing common interest developments or the governing documents of a common interest development. The bill would set forth applicable procedures for responding to the investigation request, serving a written citation and administrative fine on an association for violations of the Davis-Stirling Common Interest Development Act and other laws governing common interest developments, administrative review of any citation issued, and enforcement of any order or fine contained in a citation. [don't hold your breath waiting for this to happen and don't wait for it to happen in a meaningful manner that is readily accessible, remember this bill makes owners using this fiasco to pay for everything they get from it]
•n PAY CLOSE ATTENTION TO ALL THE OTHER GOVERNMENT AGENCIES WHO HAVE NOW GLOBBED ONTO THIS NEWLY CREATED CASH COW:
The bill would IMPOSE A BIENNIAL ASSOCIATION FEE on common interest development associations, payable upon filing specified information with the Secretary of State. The bill would require the Secretary of State to deposit the fee revenue in a NEWLY CREATED FUND [like a reserve slush fund!], the Fee Account of the Common Interest Development Bureau Fund, for the administration of these provisions upon appropriation by the Legislature. The bill would require the Secretary of State to develop a form [making a form is really HARD to DO!] for an association that is excused from paying the fee to certify that another association has paid the fee, as specified. The bill would PROVIDE THAT COSTS INCURRED by the Secretary of State pursuant to these provisions SHALL be REIMBURSED from the Common Interest Development Bureau Fund.
The term "SHALL" means there is no way around that, it is a MUST, it is non-negotiable.
• MORE REQUIREMENTS WRITTEN INTO SB551 TO BE REIMBURSED BY OWNERS FOR EVERY CENT SPENT -- AND CREATE A-N-O-T-H-E-R BANK ACCOUNT CALLED "PENALTY ACCOUNT"
But no one KNOWS where that money goes - read this double talk: "The bill would REQUIRE money paid to the bureau that is attributable to administrative fines imposed by the bureau, or cost recovery by the bureau from enforcement actions and case settlements, to be placed into the Penalty Account of the Common Interest Development Bureau Fund, for the administration of these provisions upon appropriation by the Legislature."
• SB551 IS FILLED WITH LOOPHOLES AND MONEY-RAISING PROVISIONS FOR THE BUREAU AND PROTECTIONS FOR INDUSTRIES
What's wrong with a statute that takes away the owner's right to sue in a court of law unless their request is first addressed by a letter requesting a 'resolution,' then agreeing to mediate or arbitrate, and then pay your own fees, with no guarantee of success one way or the other. That is the present Davis-Stirling Act. Did you think the Davis-Stirling Act was for homeowners? Think again. The longest and most comprehensive section in the Davis-Stirling Act is on "construction defects." Add to that, this part of SB551 wherein it states: "(iii) If applicable, the amount of funds received from either a compensatory damage award or settlement to an association from any person or entity for injuries to property, real or personal, arising out of ANY CONSTRUCTION OR DESIGN DEFECTS, and the expenditure or disposition of funds, including the amounts expended for the direct and indirect costs of repair of CONSTRUCTION OR DESIGN DEFECTS..." [how is it the construction defects lobby end up in every bill?]
• NO PENALTIES IN THIS BILL FOR INTERFERING OR AIDERS AND ABETTORS SUCH AS MANAGEMENT COMPANY OWNERS AND THEIR PERSONNELL
Why is it, that the interlopers who are responsible for much of the strife occurring in associations escape liability and penalties? You've read about many of them in the newspapers, they handle YOUR MONEY, they embezzle, defraud, get perks just for doing business with you, sabotage your living environment, cause you to end up in court, and the list goes on and on. Why do they escape liability?
• HOMEOWNERS GET ANOTHER DICTATOR ON THE PAYROLL
The Common Interest Development Bureau Chief shall have the powers delegated by the director.
• OWNERS MUST REIMBURSE THE GOVERNMENT AGENCIES
If you want to know the REAL purpose of this bill it is this: "Costs incurred by the Secretary of State pursuant to this chapter SHALL BE REIMBUSED FROM the Common Interest Development Bureau Fund." [the state now wants to generate income from the OWNERS]
• DO YOU HONESTLY BELIEVE YOU WILL EVER SEE THAT FINE!
Part of SB551 explains why you-the-owner will never be successful in implementing the fine:
"(a) An order or fine contained in a citation is not enforceable until one of the following conditions is satisfied: (1) The order or fine is reviewed under Section 1380.340 and is upheld.
(2) The time to request review under Section 1380.340 passes without review being requested."
Now read this: "IF an association does not comply with an enforceable order or fine, the bureau may file an action in superior court to enforce the order or fine. IF, after a hearing, the court determines that the order or fine is enforceable under subd. (a), and that the association has not complied with the order or fine, the court shall issue a JUDGMENT enforcing the order or fine. The judgment is nonappealable and has the same force and effect as, and is subject to all the provisions of law relating to, a judgment in a civil action."
Ask yourself how the owner ends up in court to get a judgment that the law prevented from them from filing in court to begin with? Does that really make sense to you?
*The bureau may CHARGE A FEE FOR TRAINING MATERIALS... [that's a shock - training!]
*A toll-free telephone number (that owners fund)
*Shall maintain an Internet Web site (that owners fund)
*A description of the services provided by the bureau and information on how to contact the bureau for assistance. (imagine that! we get a description of their services!)
*An analysis, prepared each year, of legislative changes to common interest development law. (more b.s. that WE PAY for, create more paperwork)
*Any other information that the bureau determines would be useful to an association or owner. ("any other"...oh, ok, lets just keep it open ended so we can keep adding more b.s. to this bill)
*Information provided on the bureau's Internet Web ... the bureau may CHARGE A FEE for the purchase of printed material... (it just gets worse from here, but we all pay for it)
*Any person may request the bureau's assistance in resolving a dispute ... [just have to wait in a looooong line]
*On receipt of a request for assistance the bureau shall, WITHIN THE LIMITS OF ITS RESOURCES ... assist BY MUTUAL AGREEMENT of the parties.
*IF the bureau receives a ...
*IF the complaint involves a ...
*IF it appears appropriate to ...
*IF the bureau determines, after investigation ...
*IF a violation cannot be remedied ...
*The citation MAY (but might not) include an administrative fine ... to be PAID BY THE ASSOCIATION TO THE BUREAU - NOT PAID TO THOSE HARMED BY THE VIOLATION.
*Within 30 days ...
*Within 50 days ...
*Within 90 days ...
*Within 120 days ...
*And we're back in court: A final decision reached after administrative review is subject to JUDICIAL REVIEW under the Government Code.
Take a close look at the language in this and the other bills, they are filled with contingencies: IF, MAY, MIGHT, BUT, EXCEPT. There's no teeth in this.
We do not make jokes, we simply watch the Coto de Caza Board of directors, the LA Trash and the Orange Crud Repository and report the facts
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