Date: April
2, 2001 EMAIL LETTER
TO: R.
Gnant, Pres. Of the Senate; J. Weiers, Speaker of the House
From: George
K. Staropoli
Honorable Sirs:
Many people
believe, including several learned scholars who have researched the issue of
the planned community/common interest development/condominium-homeowners
association situation, that these entities (HOAs for discussion) are private
governments; create a special class of citizen whose civil liberties have been
denied; are entered into unknowingly by home buyers without full and adequate
disclosure as is commonly found with the purchase of other products and
services; and exercise functions that are the sole right of a governmental
entity to exercise – taxation and fines as a means of punishment.
Many people
cannot believe that state legislatures, like the Arizona State Legislature,
turn a deaf ear to these violations.
These charges have been made to the Arizona legislators, to the press
and to the public as a result of the recent HOA Study Committee hearings. It is hard to reconcile the attitudes of legislators and state laws with the
explicit provisions of the U. S. and Arizona Constitutions.
I am, therefore,
calling to your attention some of the most egregious violations of the Arizona
Constitution and have provided the appropriate sections along with my
interpretations as to the unconstitutionality of state laws -- by a
non-professional, non-lawyer. Just a citizen’s view.
4. Due process of law
Section 4. No
person shall be deprived of life, liberty, or property without due process of
law.
Cities and town governments also have turned a deaf ear to their
citizens for monetary considerations that benefit a few citizens over others,
without due process for these homeowners to vote, in advance, on the creation
of an HOA private government. Within
these HOAs we see a lack of due process with respect to appeals of decisions by the association’s governing
boards. We see the legislators looking
the other way, hiding behind a weak and fallacious argument of a private
contract, entered into by homeowners with
full and complete knowledge of the ramifications of their decision.
1. Fundamental principles; recurrence to
Section 1. A frequent recurrence to fundamental principles is essential to the security of individual rights and the perpetuity of free government.
Homeowner
rights activists have referred to fundamental principles of American government
with references to the Declaration of Independence, the Bill of
Rights, the Federalist Papers, Thomas Paine and “Democracy in
America” and have suffered
“repeated injury”, to quote the Decl. of Indep.
2. Political power; purpose of government
Section 2. All
political power is inherent in the people, and governments derive their just
powers from the consent of the governed, and are established to protect and
maintain individual rights.
Our individual rights have been trampled on as a result of the special
interest groups involved with HOAs. You
cannot, with all conscious, say that the individual was listened to at the HOA
hearings, or before the various Legislative committees considering new
legislation. Rather, the legislators have left a definite impression that they
are listening to others, not the people from which they are to govern justly,
and have failed to “protect and maintain individual rights”.
9.
Irrevocable grants of privileges,
franchises or immunities
Section 9. No
law granting irrevocably any privilege, franchise, or immunity shall be
enacted.
13 Equal privileges and immunities
Section 13. No
law shall be enacted granting to any citizen, class of citizens, or corporation
other than municipal, privileges or immunities which, upon the same terms,
shall not equally belong to all citizens or corporations.
I maintain that the laws
relating to HOAs do grant a special privilege and franchise to these non-profit
corporations, allowing the HOA to exercise the same authority and functions as
a municipality without being subject to the Arizona laws governing the
formation and creation of governments.
They create a special class of entity, the HOA, to the detriment of the
members and residents of the association who also live within the state and are
subject to state laws. (See section 19
below for additional arguments).
Because of the denial of the member’s civil liberties under a private,
nonprofit corporation form of government, the State of Arizona has created
second-class citizens. Women, minorities and the handicapped are better
protected than a citizen living in an HOA.
These HOAs are and have been placed above the laws of the State of
Arizona and the federal government by virtue of the interpretation that they
are private contracts. And I find it
hard to accept that this position is consistent with the best interests of the
public and the Arizona Constitution.
ARTICLE IX,
TAXATION
1. Surrender of power of taxation;
uniformity of taxes
Section 1. The power of taxation
shall never be surrendered, suspended or contracted away. Except as provided by section 18 of this
article, all taxes shall be uniform upon the same class of property within the
territorial limits of the authority levying the tax, and shall be levied and
collected for public purposes only.
Not only has the legislature allowed the HOA to issue fines as punishment
for offensives as if it were a governmental entity, it has also allowed the HOA
to tax its members in clear violation of the above section. It surrendered it’s rights to the HOA. (See
remarks below regarding what’s a ‘tax’ and why assessments are the same as
taxes).
19 Local or special laws
Section
19. No local or special laws shall be enacted in any of the
following cases, that is to say:
(edited for
brevity and appropriateness)
9. Assessment
and collection of taxes.
13. Granting
to any corporation, association, or individual, any special or exclusive
privileges, immunities, or franchises.
14. Remitting
fines, penalties, and forfeitures.
17. Incorporation
of cities, towns, or villages, or amending their charters.
20. When
a general law can be made applicable.
Yet, HOAS are permitted 1) to
fine members and permit the confiscation of property as a punishment,
which also benefits some third party and not the party involved in the action
(foreclosure of a home and the sale to some third party can be construed as
cruel and unusual punishment); 2) to
collect the equivalent of taxes, in that the imposition of assessments are for
the same purposes that taxes are imposed by a municipality; 3)
the special privilege of operating outside the state laws, and in
particular, in allowing the denial of civil liberties; 4) to be formed as quasi-municipal
governments without compliance to state law on incorporating municipalities;
and 5) to exist by means of special laws in spite of existing law that is
applicable for every citizen.
For your convenience,
I’ve listed several of the more important ARS sections of Title 33, Property:
33-1242
– powers of the unit owners association
paragraphs 2, 11, 18 relating to assessments, penalties and “taxation” powers
33-1255 assessments for common
expenses
33-1256 lien for assessment
33-1803
– Penalties
33-1807
– lien for assessment
Essentially,
Chapters 9 and 16 of Title 33 are the limited authority given to planned
community associations and condominium associations. Other authority and powers
come from the Title 10, Corporations and various provisions relating to generic
non-profit, membership organizations.
There are no additional provisions in Title 10 that grant any other
governmental powers to HOAs.
As an example of state legislature’s failure to comply with its state
constitution, allow me to cite two cases, one in Virginia and one in Rhode Island. Both deal with the unconstitutional
surrender of governmental prerogatives to HOAs
with respect to the imposition of fines by HOAs.
Unit Owners Assoc v, Gillman 223 VA 752 (1982), whereby the Virginia Supreme Court held that the
power to fine is a governmental power.
James Foley v. Osborne Court Condominium et al C.
A. No. 96-360 Superior Court of Rhode Island Newport (1999) where the R.
I. Supreme Court asked the lower court to determine if fining represents an
unconstitutional delegation of judicial or police power to the association. The lower court gave this decision because the statute allowed
associations to act as a tribunal exercising judicial power since the
association had the right to enforce
its orders by depriving a violator of property by foreclosure. Therefore, the statute was unconstitutional
delegation of governmental powers.
I sincerely hope that you will seek advice from the Attorney General in
regard to the existing statutes on
planned community developments and homeowners associations, especially in
regard to the areas mentioned above, to determine their constitutionality
before preceding any further with new legislation.
Yours very truly,
George K. Staropoli
George K. Staropoli
602-228-2891
starmangroup@cs.com