By Deborah Goonan, Independent American Communities
A few months ago I wrote about a situation in Dunwoody, Georgia. The City Attorney warned that allowing Dunwoody HOA (DHA) board members to also serve on City Council boards could lead to conflicts of interest. Although DHA is a voluntary association, there were concerns that dual membership with the neighborhood association and the City could, for example, influence zoning and planning decisions.
City Council met privately in executive session to discuss one particular conflict related to litigation, and that was allowable under Georgia’s open meetings law. But then a discussion ensued about whether or not City-appointed board members should be required to resign from an HOA board to avoid future conflicts of interest.
That led to a hastily written letter to several City Council board members, demanding that they resign from DHA board membership. DHA board members objected to the decision and the matter was brought before the Attorney General as a violation of Georgia law, who recently ruled that the general discussion about whether City Council board members must give up their positions on DHA should have been held in public, not in executive session.
City Council has been ordered to attend training on Open Meetings Law requirements.
In the end, City Council had to reverse their decision. DHA members still serve on Dunwoody City boards, with potential conflicts of interest.
The matter can be put on a future agenda of the City Council for public discussion, and it probably should be.
For reference, here’s the update:
Dunwoody City Council’s private meeting wasn’t allowed
Updated: 5:29 p.m. Friday, Oct. 7, 2016 | Posted: 2:48 p.m. Friday, Oct. 7, 2016
The Dunwoody City Council violated Georgia’s Open Meetings Act when it held closed-door discussions about the role of a homeowners association in government, according to a letter from the Georgia Attorney General’s Office.
State law prohibits conversations about policies and procedures during executive session, wrote Assistant Attorney General Jennifer Colangelo in an Oct. 3 letter to the city’s attorney.
The City Council was permitted to talk in private June 13 about a potential conflict of interest with the Dunwoody Homeowners Association in relation to a pending lawsuit over a zoning decision for a daycare provider, Colangelo wrote. But discussions about how to handle similar situations in the future should have been held in public.
“Council members should always be aware of their legal duty to have such conversations in public, and the council should end its executive session discussion when discussion goes beyond the confines of the actual or threatened lawsuit,” Colangelo wrote.
Read more:
The question that comes to my mind: why can’t all HOA members file complaints with their Attorneys General when HOA Boards fail to meet openly to discuss association business?
Well, for one thing, many states do not even require open meetings for boards of Association-Governed Communities, because they are viewed as private corporations. Open meeting laws that apply to governments do not apply to private organizations.
In some states, HOAs are required by statute to conduct meetings in the open. But the problem is, there’s no one to enforce that law. And in states that do have an agency or consumer protection bureau to take complaints, there is often no legal authority to investigate complaints or penalize HOAs for noncomplaince. As a homeowner, the only way you can enforce the law is to file a lawsuit against your HOA.
For reference, here’s the original article:
Dunwoody HOA members asked to choose between City or DHA board service?
Do any of your homeowners, condominium, or cooperative association trustees or board members also serve on a board or committee of your local municipality or county?
If you do not know the answer to that question, you might want to find out, especially if you live in Dunwoody, Georgia.
Dunwoody drops bombshell on DHA membership about city appointments
The city dropped a bombshell on the Dunwoody Homeowners Association last week, demanding members either resign from the DHA or resign from city boards they currently serve on.City officials emailed out a five-page memo on June 17 explaining the city had adopted a new policy that forbids DHA members from serving on certain city boards or commissions due to the potential of a conflict of interest – and to also stave off potential threats of a lawsuits, according to a city official who asked not to be identified.
…
A city official said the mandate affects 24 members of the Planning Commission, Zoning Board of Appeals, the Construction Board of Adjustment and Appeals and the Design Review Advisory Committee.
Potential conflicts of interest
Think about it. Should Association Governed Housing board members be able to vote on zoning changes?
For example, suppose the City wants to add youth recreation facilities or build a child care center near a condominium or townhouse association where many of the residents are over the age of 55? The board member(s) of that condo association that happen to be on the Zoning board might object to the potential for noise from children playing, and prevent an otherwise popular community improvement project from happening.
Here’s another example. Suppose your HOA board is still under developer control. Let’s say the developer decides he wants to change zoning on multiple parcels of land from detached single family to multifamily homes, or to redevelop what is now a golf course. Should the developer’s appointed HOA board members be able to promote and vote on zoning changes to benefit their interests, without any regard for the impacts on the rest taxpayers in the association or neighboring communities?
Or should Association board members sitting on a city’s design review committee be able to impose their restrictive stance on aesthetics or property use upon non-HOA property owners? What would stop a city committee of like-minded HOA board members from enacting HOA-like restrictions on the size and type of signs that could be posted for businesses, or from prohibiting food trucks, or a convenience store anywhere that is remotely visible from their private communities? Just imagine if your HOA board members sitting on the city’s committee decided to require expensive upgrades and improvements to improve the facade of businesses on Main Street – in approved colors, of course.
You can see where the influence of a few citizens could go overboard.
When you look at the big picture, Dunwoody’s new policy makes a lot of sense.
The new policy implicitly acknowledges that Association Governed Communities are hyper-local units of government.
Just as a State Representative cannot simultaneously serve on a City Council, Dunwoody officials are saying that appointed City board and committee members cannot serve two masters. They must choose whether they wish to serve on the board of their Association or on a board or committee for their City.
Just a start toward eliminating conflict of interest
I think what Dunwoody is doing is a good thing, but it won’t completely eliminate political conflicts of interest.
Take Florida for example. Poinciana HOA consists of more than 26,000 homes. It is the major “mini-government” in both Osceola and Polk Counties, and, with approximately 60,000 residents, a major player in state and federal voting districts. Poinciana’s multiple attempts to get a referendum on incorporation as a city have been consistently blocked by both County Delegations. The delegations must approve going forward with a state referendum to allow Poinciana registered voters to decide how they want to govern themselves.
But consider that, from the Counties’ perspective, the more tax money that goes to municipalities, the less tax money that will flow to County governments. So why would the County Delegation be in favor of allowing Poinciana to incorporate as a municipality?
Each time the County Delegation votes “no” on moving forward with incorporation, it denies Poinciana residents their civil liberties to decide for themselves at the ballot box.
Eliminating conflicts of interest that create disproportionate influence of HOAs or local governments is a daunting but important challenge. But there is great value in preserving individual property rights and, more broadly, civil liberties for all.
Note:
Dunwoody Homeowners Association is a voluntary association. Many of its members live in voluntary HOAs, some live in mandatory HOAs and condominium associations. Dunwoody is a relatively affluent city consisting of many historic and vintage homes, as well as new construction.
UPDATE:
The City of Dunwoody has suspended its order that DHA board members must resign from either their DHA or their own Association Boards, pending a legal review. Citizens have objected that the policy was not presented and voted on in open session, and that it singles out DHA even though dozens of other similar associations also participate in City government.
Dunwoody council suspends order to DHA members to choose between membership in the group and city appointments
The matter will most likely be addressed in future open meetings.
I believe you have misread my article and completely missed the point. Although I have fully acknowledged that DHA is a voluntary HOA – more akin to a Civic Association – that fact is irrelevant to the discussion of what constitutes a conflict of interest.
The possibility that a developer might sue both the City and DHA over a denial of a requested zoning change or variance, or denial of a development plan, is quite real. The citizens of Dunwoody have the right to expect all of the members of their City Council or Zoning Board to be actively involved in defending the interests of all their constituents, and how development or litigation will affect City taxpayers. If one or more council/committee members must leave the room for every discussion of pending or ongoing litigation, city residents effectively end up with diluted representation.
As someone has pointed out in the comments below the referenced article, not everyone who lives in the City of Dunwoody holds the same views and priorities as DHA. And not everyone who resides within DHA boundaries participates as an active member of the civic association, nor do they agree with your stance – as a Director and Officer of DHA – on important issues involving new development.
Civic Associations such as DHA can serve a valuable role in their communities.
A civic member of DHA could still be appointed to a committee by City Council. At issue is whether a Board or Committee member of DHA, who is obligated to represent the specific interests of DHA, can also adequately represent the interests of the city as a whole, particularly when those interests are opposing.
I agree with your point that the City’s process of discussion and making policy on this issue needs to be done in the open. And I agree that a conflict of interest policy must apply to all HOAs/neighborhood associations, whether mandatory or voluntary in nature.