HOA industry trade group favors strict enforcement of covenants, but not fair housing laws?

CAI says it doesn’t want HOA boards to be responsible for getting involved in neighbor disputes with allegations of discriminatory harassment

By Deborah Goonan, Independent American Communities

Most homeowners and residents of common interest, association-governed communities have probably never heard of Community Associations Institute (CAI), a trade group for the industry.

In case you missed it, here on IAC I have exposed the trade group’s legislative and political agenda in several previous posts, including this one  and this one .

In a nutshell, while CAI is sometimes fond of claiming that it represents the interests of homeowners who reside in HOAs, including condominium and cooperative associations, it primarily serves the interests of its trade group: community association managers, attorneys, HOA collection agents, reserve specialists, lenders, insurers, and a small number of board members who authorize HOA service contracts.

It bears repeating that CAI provides training materials designed specifically for board members, with the primary purpose of serving the benefit the HOA corporation, not necessarily all of the people (HOA members and other non-member residents) of association-governed communities.

Critics tend to agree that, because the HOA industry cares mostly about protecting property values, as opposed to social or human values, an HOA doesn’t truly serve the greater good.

Today I present two articles written and released by CAI, to illustrate my point.

HOA planned community aerial view
(pixabay.com free image)


Enforcing rules vs. ending discrimination

It’s no secret that CAI is 100% in favor of enforcing CC&Rs, rules and regulations, No Matter What. In fact, many CAI accredited managers and management companies actively encourage community residents to notify their association of covenant, restriction, and rule violations.

HOA management administered websites often make it easy to file complaints online, so an owner or resident never has to confront a neighbor directly about a nuisance or “eyesore” violation.

In one of CAI’s news releases claiming that most residents are ‘satisfied’ with their association-governed community, the industry talking points are highlighted in this excerpt: (my emphasis in bold)

According to an article by Michele Lerner on Realtor.com, “Homeowners association rules can be what attracts someone to a new home … or what drives them away. But if you’re on the fence about whether you want to live in an area with an HOA and abide by the rules, it’s worth investigating the particular neighborhood and finding out more.”

She says many homeowners prefer to live in a homeowners’ association for several reasons, including:

Community appearance: “Homes within an HOA must meet the standards set by the association or face a fine, so you’re less likely to see unkempt lawns, peeling paint or a garishly painted house,” she says.

Low maintenance: Depending on the HOA, services such as trash and snow removal and lawn care are handled by the association, leaving less work for the homeowner.

Recreational amenities: Many neighborhoods offer attractions such as a community center, walking trails, sports courts and playing fields reserved for residents, if not a swimming pool or tennis courts.

Association management: If you have a problem with your neighbor’s dog barking, loud parties or a dispute over a tree, you can ask the management to handle the issue, Lerner says.

So, the industry trade group promotes the idea that any one of your neighbors can file a complaint if you don’t put your trash can back in the garage immediately after pickup. Or maybe your neighbor disapproves of your choice of window treatments, that little flag in your flower pot, or the short retaining wall in your professionally designed landscape.

RULE blackboard authority Know the rules
Pixabay.com free image

By contrast, however, CAI argues against a neighbor getting the association involved by reporting housing discrimination or harassment.

In a recent white paper, entitled Community Associations Seek Guidance and Clarification on HUD’s Third-Party Harassment Rule, CAI asks the Department of Housing and Urban Development to reverse or amend the Quid Pro Quo and Hostile Environment Harassment and Liability for Discriminatory Housing Practices Under the Fair Housing Act.”

See excerpts, with my emphasis added in bold:

In the white paper, CAI states that community association boards should liable for the direct actions of board members and managers that create a hostile housing environment. We explain, however, that a community association should not be liable when the harassing behavior is committed by a resident against another resident—where there is no agent relationship.

It’s the view of many community associations that the HUD rule imposes on association boards the burden to police conversations and interactions between homeowners. The liability for hostile housing environments should rest with harassing parties.

CAI respectfully requests:
1. The Department reaffirm, through a revision of the rule, adherence to legal precedent requiring an intent to discriminate be shown for a community association to be liable for third-party hostile housing environment discrimination, and
2. The Department provide written, legal guidance for community associations to ensure compliance with the rule.


(Pixabay.com free image)

Interesting, isn’t it?

In CAI’s view, a resident need not be burdened with confronting a neighbor about a barking dog or a less than pristine front yard. At least in theory, the HOA can and must intervene on your behalf. That’s what the HOA — and its power to impose a monetary fine — is for!

But if one resident is harassing other residents with racial or ethnic slurs or hostile discriminatory behavior, making it difficult or impossible for residents to live peacefully in their homes, then the HOA prefers not to insert itself in the middle of a neighbor vs. neighbor disputes.

See also: 

HUD “Quid Pro Quo” rule clarifies HOA duty to stop discrimination among residents

Note the careful wording of CAI’s stance that HOA boards should only be held accountable for third-party harassment if and when board members or management agents show a clear intent to discriminate.

In matters involving housing discrimination, the industry prefers that your HOA take a “hands off” stance, in the same way your local and state governments often take a “hands off” stance in disputes between HOA corporations and their members.

According to the white paper, CAI claims that filing a legal injunction against a property owner in violation of the Quid Pro Quo/Hostile Environment Act would cost an HOA $10,000 to $25,000 per lawsuit, and those costs would likely not be covered by insurance.

But many HOAs are perfectly OK with spending at least that much money, and often much more, to enforce restrictive covenants, or to collect disputed fines or assessments.

Double standard?


housing-condominium apartment brick tower
Historic downtown condos for sale or rent. Almost two-thirds (63%) of residents say they love living here.

In the same white paper, CAI, makes much ado about the fact that an HOA’s relationship to its members is not equivalent to a landlord-tenant relationship.

But read between the lines: in many ways, tenants are entitled to greater civil protections than homeowners. (Emphasis added)

The differences in the legal status of homeowners in a community association and tenants in leased housing are fundamental. Community association homeowners take title to real property and an undivided interest in common elements, tenants do not. Landlords have specific obligations under law and contract to tenants that associations do not have to property owners. Landlords may unilaterally impose restrictions on the use of a dwelling and the conduct of tenants while associations are limited in the ability to add new restrictive covenants.

One difference of note is lack of eviction authority. Community associations do not possess the one penalty that will, when applied, end a discriminatory housing practice: eviction.

While homeowners’ and condominium associations cannot evict property owners (but cooperative association can do so), nearly all mandatory/involuntary membership associations have even greater power to fine, lien, and foreclose — literally taking property away from the homeowner.

Two other complicating factors:

In most states, HOAs also have the authority to collect rent and evict a tenant when the property owner is delinquent on assessment payments.

And at least 20% of association-governed community residents are tenants. If the absentee landlord must take steps to end housing discrimination, why should the association have no duty to act?

It’s not as though boards of association-governed communities are powerless to act.

For example, HOA boards have the authority to make rules related to covenants and restrictions. While CC&Rs may not provide specific authority of the association to enforce state and federal law, it would be unreasonable to conclude that HOA boards and management agents have absolutely no duty to comply with state and federal law, working to prevent or put a stop to discrimination and harassment.

At the very least, to preseve peace in the community, the HOA must take a “see something, say something” stance, reporting known discriminatory conduct to appropriate state and federal enforcement agencies, or, if appropriate, local law enforcement.

CAI argues that HOAs lack the authority to enforce the Act. But harassment and fair housing discrimination of any kind can be said to create a nuisance. Virtually all governing documents grant associations the authority to enforce anti-nuisance restrictions by way of monetary fines, restriction of access to common amenities, and removal of voting rights.

It’s puzzling that CAI advocates for turning a blind eye to housing discrimination among its members and residents.


Quid Pro Quo and Hostile Environment Harassment and Liability for Discriminatory Housing Practices Under the Fair Housing Act

Community Associations and Third-Party Harassment Association Obligations to Intervene in Resident Disputes



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