HOA Organizational Development

Not a CAI member, or affiliated with any CAI member organization, or subjected to CAI 'educational' HOA doctrine

"developing homeowner associations into healthier, more member responsive communities"    

INTRODUCTION

Organizational Development (OD) is a fresh approach to resolving the persistent 49 year problems with the HOA legal model and scheme. It is not simply more legal solutions or more pontifications by lawyers or property managers attempting to correct the dysfunctional behavior within HOA communities. OD is a comprehensive behavior based approach concerned with the HOA climate, or HOA "personality," which encompasses members' attitudes and beliefs. It is also concerned with the HOA culture, its deeply seated norms, values and behaviors that members share. These assumptions, values and norms reflect members' unconscious thoughts and interpretations of their organizations.

 

HOA ORGANIZATIONAL DEVELOPMENT
1. What is organizational development?
2. Why the need to develop HOA organizations?
3. What are the primary causes?
4. Member behavior in dysfunctional HOAs
5. The mission for HOA organizational consultants

Information on HOA regimes –
    6. Constitutional Local Government
    7. HOA Constitutional Government

Appendix
    8. Sample HOA governance self-assessment (rate 1- 5)
    9. Author Backgrounder

 

 

What is organizational development?

 

Organizational Development (OD) is a values-based approach to systems change in organizations and communities; it strives to build the capacity to achieve and sustain a new desired state that benefits the organization or community and the world around them.  It approaches communities and organizations as open systems; that is, acts with the knowledge that change in one area of a system always results in changes in other areas; and change in one area cannot be sustained without supporting changes in other areas of the system.

 

Organizational Development (OD) is an approach, a method, a process dedicated to expanding the knowledge and effectiveness of people to accomplish more successful organizational change and performance. OD emerged out of human relations studies where psychologists realized that organizational structures and processes influence worker behavior and motivation, and in turn, organizational mission achievement.

It is behavior oriented. OD is a change process with the goal of transferring knowledge and skills to organizations to improve their capacity for solving problems and managing future change. It focuses on the behavior of the members of the organization and how their behavior contributes to its goals as well as the feelings of satisfaction and stress, and service quality. 

  It is concerned with leadership, openness of communication, participative management, role clarity, conflict resolution, and leader support and control. OD will examine the organization’s mission, goals, policies, structures and technologies; its climate and culture; and desired outcomes and readiness to take action.

 

Why the need to develop HOA organizations?

First, it must be understood that the HOA organization consists of not only the board and officers, but the membership as well.  In the OD approach to HOAs, we must also recognize the strong influence and control that attorneys and managers have over the HOA.

The answer to the above question is simple:  there is a very strong need for change in the HOA corporation, in its legal structure, in its model of government that stands in stark contrast to our system of democratic government, in its climate and culture that imposes a strict authoritarian control over people, and in the radical changes in behavior required of its members in order for the HOA to function as intended.  To many HOA members, living in an HOA is like living in a hostile foreign country, a banana republic.

The mindset that has been imposed upon our society is that the values of HOA governance justifiably exceed any detriments relating to the loss of constitutional protections and the equal protection of the law.  The irrational defense of this HOA concept is the biased interpretation and selective application of the laws to, in effect, make the HOA model work. When such a defense argument is used by state governments to create a form of private government that rejects and opposes the social contract of the US Constitution, the people will react accordingly. 

 

Behavior problems have resulted as we have witnessed:  feelings of hopelessness and abandonment, apathy, stress; the HOA Syndrome (PTSD); anger and violence. Especially creating stress and the feelings of abandonment by the government is the treatment of the HOA as a public entity or as a private contractual entity.  The resultant behavior that we have seen or heard daily in the media across the country is a clear indication that “something is rotten in the state of Denmark.”  Yet, the pro-HOA special interests, as reflected by their very influential lobbying activities, continue to see no evil. 

Their attitude falls under: The HOA has certain rights that must be considered; if only the members would just follow the rules all will be great; that all that is necessary is to legislate proper behavior and proscribe improper behavior.  For they are honorable men; so are they all honorable men.

Yet, state legislatures see no evil. So urgent changes in our mindset, our attitudes, and our value system regarding the social and legal aspects of private government HOAs are in order. The OD process is the method to bring about this change.

 

 

What are the primary causes?

 

From the very beginning of the revised HOA legal model in 1964, as set forth in The Homes Association Handbook, objections to and problems with HOAs were being discussed by political science researchers, attorneys, investigative reporters, authors and CAI itself. A short history includes, among others,

  1.  The Homes Association: Will ‘Private Governments’ Serve the Public Interest, 1967 (paper published by Univ. Calif., Berkeley).

  2. Condominiums and Homeowner Associations That Work, 1978

  3. America II, 1983 (a critique of the HOA concept by an investigative journalist).

  4. Neighborhood Politics, Residential Community Associations in American Governance, 1992.

  5. Privatopia: Homeowner Associations and the Rise of Residential Private Government, 1994.

  6. Common Interest Communities: Private Governments and he Public Interest, 1994.

  7. Community Associations: The Emergence and Acceptance of a Quiet Innovation in Housing, 2000.

As evident from the above publications, the central issue with HOAs is related to their private, contractual nature. The pro-HOA special interests have convinced the legislatures, the public and homebuyers that the HOA is not a government, but a business. Yet, on the other hand, it has for all these years maintained that HOAs are democratic because people can vote, a somewhat confusing statement. And furthermore, that in spite of the evidence to the contrary, buyers have fully agreed to the CC&Rs “contract” that they have supposedly signed, have voluntarily surrendered or waived their rights, and have accepted the HOA’s version of due process, fair elections, ex post facto CC&Rs amendments and freedom of speech restrictions.  Another assertion that is strongly denied by homeowners.

As evidence in defense for these misleading arguments, proponents say that the fact that the member remains in the subdivision is his tacit consent to agree to be bound by the HOA.  As if the HOA were a public entity where residents are held to have agreed to be bound by public laws. All in spite of the terms and conditions of the CC&Rs that govern the legal relationship between the owner and the HOA. Contract law be damned!  These confusing and often irrational defenses play havoc with the homeowner.  Is he or is he not protected by the constitution and state laws is his concern?

In reality, however, the HOA is the de facto governing body of the subdivision, as stated in the statutes and governing documents, under a very confusing and often changing set of laws and interpretations.  And there are no standards and state requirements for the CC&Rs in order to serve as an HOA bill of rights for homeowners. 

But, a rose by any other name is a rose; if it walks like a duck, quacks like a duck, and looks like a duck it’s a duck.  The literature is full of court references, legislative references and special interest references that the HOA is a quasi-government or mini-government and takes on many functions of the municipality: it is allowed to tax, called assessments, allowed to fine, called penalties, to legislate and make laws, called rules, and allowed to adjudicate the taking of a homeowner’s property by foreclosure.

The HOA government, the board and officers, are deemed to be incapable of doing any wrong although James Madison warned of the contrary: "If angels were to govern men, neither external nor internal controls on government would be necessary" (Federalist Papers, #51).  And even though the basic fundamentals of our system of government also addressed the human frailties by imposing checks and balances and a separation of powers are ignored in the HOA scheme.

In short, HOAs are unaccountable to the state that does not impose penalties against the board for violations of the law and governing documents that are sufficient to serve as a detriment. It is content that the homeowner can enforce the laws and governing documents at his own cost while the HOA uses his money to fund an attorney.  The rights that the homeowner thought he possessed as a citizen were stripped from him without his consent, as the HOA is a private contract. The HOA member is treated as a second-class citizen by his state government. Where and to whom can he turn? Nowhere and Nobody! 

  

  

Member behavior in dysfunctional HOAs

 

Given the all-encompassing political and legal structure of the HOA scheme or model, it is not too difficult to understand member reactions and behavior. It is not difficult to understand 1) the discord, the hostility in the HOA community and the stress, both emotionally and financially on the homeowner; 2) the adversity felt by average people who find themselves in a strange world that they would have not accepted if fully disclosed; 3) the feelings of helplessness when they discover that they are powerless without the support of their neighbors, which is rarely forthcoming; and 4) where they are essentially at the suffrage - the whims - of the board that can change in a day.

The state government’s laissez-faire attitude toward HOA communities has allowed the HOA to become a closed, inbred society where "the state is everything." It is not surprising, then, that several groups with personal agendas have emerged, creating a dysfunction climate and culture within the closed HOA society. These negative influences helped shape the character and quality of life in the community. Here are links to a few appropriate research studies:

1. Before the HOA Syndrome there was The Milgram Experiment (harmful acts carried out under pressure by "authorities").
2. Why do people harm others in HOAs? (Milgram and Stanford Prison research, where role models by "authority" and "submissive" subjects had to be cut short).
3. Psychologist defines the HOA Syndrome caused by oppressive HOAs (psychologist identifies PTSD attributed to living in an HOA).
4. Solomon Asch experiment (1958) A study of conformity (group pressure influenced decisions by subjects).

The 1955 interviews by Milton Meyer, a journalist, who sought answers to the question as to "how could the people allow Hitler to take control of Germany?" are very revealing. A very apropos question today for HOA regimes. Among the replies from his respondent, working class Germans were,

"What happened was the gradual habituation of the people, little by little . . . . This separation of the government from people, this widening of the gap, took place so gradually and insensibly, each step disguised. . . . [Mayer believed that the good people went along] in the usual sincerity that required them only to abandon one principle after another, to throw away, little by little, all that was good.

"They further rationalized that "when men who understand what is happening - the motion of history not the single events or developments - when such men do not object or protest, men who do not understand cannot be expected to."

"On the one hand your enemies, the law, the regime, the Party intimidate you. On the other hand, your colleagues pooh-pooh you as pessimistic, or even neurotic. Now you live in a world of hate and fear, and the people who hate and fear do not even know it themselves. . . . Now you live in a system which rules without responsibility even to God."

They Thought They Were Free, Milton Mayer, 1995.   

These issues cannot be corrected by lawyers writing CC&Rs or by crafting pro-HOA legislation. Nor can they be corrected by property managers. And state legislatures cannot mandate correct behavior, following in the footsteps of the approach adopted by the HOAs with their rules and strict enforcement of the rules.

  

The mission for HOA organizational consultants

 

I have been immensely disappointing that no one in the behavioral sciences field has undertaken an in-depth analysis of the behavioral dynamics operating within the essentially closed communities commonly known as homeowners associations. If such a study (similar to Whyte intermingling with and observing and interviewing his subjects) were to be conducted today, the findings would show that the Street Corner Society mentality was alive and well in homeowner associations.

A comparison between Whyte’s Cornerville community, with its Corner Boys and College Boys, and today’s HOA communities can be made. Whyte describes the problems Cornerville as, “Cornerville’s problem is not lack of organization, but failure of its own social organization to mesh with the structure of the society around it.” I speak not of the board of directors and officers, but of the rank and file members who blindly defend the actions of their board, right or wrong, and their community as healthy and satisfying. Whyte was concerned about the “big shots” in Cornerville, who were the racketeers and politicians, or our HOA directors of today. He asks, “What makes a man a big shot and by what means is he able to dominate the little guys,” or the rank and file HOA members of today.

I have earlier described the dysfunctional climate and culture of homeowners associations. Leaving aside the questions of legality, which would need to be addressed as part of any OD effort, the mission for HOA OD consultants is,

1. to return the climate and culture of the HOA to where its members are able to re-identify with the values, beliefs, principles, and purposes of healthy and desirable communities functioning within the larger society of the municipality and the state; and
2. to remove the very strong external influences of the special interest vendors and lobbyists that are the primary causes of this deviation from the general societal norms and values.

A massive, multi-disciplined OD intervention is needed that is not for the faint of heart. OD diagnosis, evaluation, and the transference of knowledge and skills to HOA regimes are in order. It must be fully understood that education in constitutional law and politics will be required.

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