HOAs by the numbers
Kansas lawmakers have rejected a bill that supporters said would have made homeowners associations more accountable by placing their oversight under the Kansas Attorney General’s office.
Lawmakers shot down House Bill 2629 after a 36-minute debate on the House floor, followed by an unrecorded voice vote.
"I just don't get it," said Scott Wircenske, an Olathe homeowner who sued his HOA to see its financial documents, then went to authorities after discovering the property manager was mishandling the funds. "Why would you not want this level of protection if you’re a homeowner? If I’m a homeowner, I want to know that the books are clean through and through and that I don’t have to worry about it because there’s this oversight."
Under the proposal, the attorney general would have been required to investigate homeowners’ complaints about their overzealous HOAs. The bill also would have required all homes associations in the state to register annually with the attorney general, providing the names of the HOA's board members and property managers. And those who knowingly violated homeowners’ rights could have faced a $500 civil penalty.
Proponents said it would have made HOAs more transparent and given homeowners relief without having to resort to costly lawsuits. A recently resolved lawsuit involving the Avignon Villa Homes Community Association in Olathe racked up hundreds of thousands of dollars in attorneys’ fees for both sides.
“This provides a pathway to our consumers of Kansas that would prevent them from having to spend thousands to millions of dollars in litigation,” said Rep. Kristey Williams, R-Augusta and chairwoman of the Local Government Committee, which handled the bill.
But during the debate last week, opponents said the bill was overkill and would discourage homeowners from volunteering to sit on their boards.
“I’ve served on one; my wife is serving on one right now,” said Rep. Tom Phillips, R-Manhattan. “If we have the threat of a $500 fee against individuals that are serving in a voluntary capacity, I think a lot of people simply will not serve…
“I really think this is an overreach. It’s casting a net that is way too wide.”
The Star published a series on homeowners associations in 2016, finding that HOAs wield far more power than homeowners realize and that some actually torment the residents they’re supposed to support. And The Star continues to regularly receive calls about horror stories in HOAs.
In 2010, Kansas became the first state to adopt the Kansas Uniform Common Interest Owners Bill of Rights Act, which requires HOAs to hold open meetings, keep minutes of those meetings and allow members of the HOA to inspect the associations’ books and records upon request. But many said the law, which went into effect in 2011, didn’t have any teeth.
House Bill 2629 would have authorized the attorney general to investigate consumer complaints about violations of the homeowners bill of rights by an HOA’s board of directors or property manager.
House Speaker Pro Tem Scott Schwab, an Olathe Republican who proposed the bill, told how Wircenske, a constituent, was forced to take his HOA to court because board members wouldn’t let him see the financial records or meeting minutes.
“These are mini-governments. And the city can’t stop it. The county can’t stop it. The township can’t stop it. The only way to hold them accountable is you’ve got to sue yourself and your neighbors for people who aren’t obeying existing law,” Schwab said.
But Rep. Russ Jennings, R-Lakin, said homeowners know what they’re getting into when they buy in an HOA.
“People who buy property that have restrictions or covenants on that property do so at the time of the purchase knowing that it exists,” he said. “I’m not sure why the state should provide counsel for folks who have a complaint about an HOA when they entered into a contract to do it with them in the first place.”
Rep. Elizabeth Bishop, a Wichita Democrat who has served as president of her HOA, said the bill “is all stick and no carrot.” The homeowners bill of rights was a step in the right direction, she said.
“But I believe we can come up with another option that gives homeowners associations support and training and points them at these very good guidelines and helps them with it,” she said. “This needs to go back to the drawing board. Craft some enforcement that also has some carrot along with the stick."