Residents will never get fair treatment in HOAs, because of this fundamental flaw

By Deborah Goonan

What would you say if I told you that your neighbor voted for the Mayor of your city seven times in the last election? And what if you learned in the news that the owner of the apartment high rise down town voted 240 times at the polls? What if your neighbor, going through hard times and behind on his property taxes, was turned away at the polls and denied his right to vote? Suppose there was a controversial referendum on the ballot, and lots of wealthy property owners got to cast one vote for each property they owned?

Chances are you would be indignant, as you should be.

But this is almost always the process used to elect your HOA Board of Directors – well, when there actually is an election – and how changes are made to your HOA CC&Rs (Covenants, Conditions & Restrictions), all those rules you must follow, or else.

Although your HOA may seem like local government, with the power to enforce penalties for various violations large and small, the fact is, your HOA is a legal corporation and not officially a government.

Therefore, the corporate voting model is used. Each property owned represents one share of the HOA, and gives the right to one vote. Unless, of course, you happen to be the Developer, in which case you have weighted votes – anywhere from three to nine votes per lot owned – during the time of construction and sale of homes. (Not that it matters for elections, because during Developer control, the Board is appointed, not elected. But it still matters for amendments to the CC&Rs.)

It doesn’t matter how many people live in your house, you still get only one vote, as long as you’re the owner. If you’re a tenant, you probably don’t get to vote at all, unless the HOA allows the owner to allocate his or her vote to a tenant.

What about that real estate investor, a friend of the Board President that just purchased 40 homes or condos in your HOA? She gets 40 votes, one for each property, of course. It doesn’t matter if she doesn’t actually live in the community, or if she’s an absentee landlord that doesn’t even manage her properties or monitor her tenants (other than to collect rent). She still gets 40 votes to your measly one vote.

As for your next-door neighbor that is behind on her assessments due to unforeseen medical bills, and the neighbor down the street that hasn’t paid a fine for that stubborn brown spot in his lawn: their votes are not counted! Never mind that the poll tax was declared unconstitutional in 1964, with the ratification of the 24th amendment, because corporations do not necessarily have to guarantee shareholders Constitutional protections.

How might this lopsided allocation of voting rights affect your next Board election? Now imagine what will happen when the Board wants to relax rental restrictions. Who has more votes in your HOA – the full-time owner-residents or the bulk buying landlord-investors?

Contrast this to the more democratic process in conventional American communities, where each citizen who is registered to vote gets but ONE vote, regardless of income level, tax delinquency status, or number of properties owned.

The corporate allocation of voting rights practically guarantees inequity in HOAs.

Welcome to the neighborhood.

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