Guess who advises Delaware AG on HOA regulation?

By Deborah Goonan, Independent American Communities

Unbelievable but true: The community association industry trade group, whose members feed off of common interest communities, advises the Delaware State Attorney General on how to “regulate” HOAs.

Pardon the cliche, but that’s like the fox watching the henhouse.

Seeing is believing, so here are some screenshots to prove my point.

Delaware AG’s “Fraud and Consumer Protection” web page is little more than an ad campaign for Community Associations Institute. Click on the images in the slide show below to enlarge them.

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Virtually every educational reference is a publication of CAI. It’s as if former Attorney General Matt Denn, who decided not to run for re-election last year, simply directed his staff to cut and paste information directly from CAI’s website.

And a view of Delaware AG’s Fraud and Consumer Protection Division, Ombudsperson Advisory Council webpage explains why CAI has such heavy influence on “educating” homeowners and associations. (Click on the image to enlarge.)

Delaware AG HOA common interest Ombud Advisory Council webpage
Delaware AG HOA common interest Ombud Advisory Council webpage (Screen capture from attorneygeneral.delaware.gov/fraud/cpu/ombudsperson/advisory-council/ on Jan. 11, 2019)

As you can see, CAI and the Home Builders Association of Delaware helped to appoint members of an 18-member Common Interest Community Advisory Council.

So, now take a look at who served on that Council as of 2017: (click on the window below to scroll through the list)

Who’s on the DE CIC Advisory Council?

Listed as the Chair  of the CIC Advisory Council: Gail Launay-Tarlecki, a member of Delaware Human Relations Commission, and former owner of Right Property Management.

Right Property Management was presumably acquired by Equity Cap Property Management within the past year. (Right Property Management is listed as CLOSED, and the web address for the company is redirected to Equity Cap Property Management.)

Other notable members on the CIC Advisory Council include:

  • William P. Brady, an attorney who practices in Delaware, New Jersey, and Pennsylvania, and who specializes in representation of HOAs and condo associations and Alternative Dispute Resolution (ADR)
  • Tony Campisi, Executive Director for the Pennsylvania and Delaware Valley Chapter of CAI
  • Frederick Fortunato, principal of Benchmark Builders, developer of multiple common interest communities in Delaware
  • Chad J. Toms, another Delaware attorney that represents community associations (HOAs)

Seven seats on the Council are held by or reserved for local elected or appointed officials.

Who’s not on the CIC Advisory Council?

Even more telling than who’s on the CIC Advisory Council is who’s not invited to participate.

Of the 18 members, only four are listed as “HOA Executive Board” members. The Council does not include homeowners or housing consumers at large. Not a single one!

That’s ironic, isn’t it? Shouldn’t the CIC Advisory Council consider the perspective of non-board member homeowners and residents of common interest communities?

The Council obviously recognizes the prevalence of disputes between homeowners and their HOAs, or they wouldn’t be pushing mandatory mediation and arbitration. The fact that actual housing consumers have no seat at the table is alarming. It leads to the conclusion that any form of ADR promoted by the Council would put housing consumers at a distinct disadvantage.

The only nod to consumer and civil rights advocacy on the Council: two members of the Civic League of New Castle County. Two out of eighteen.

Notably, Delaware’s CIC Advisory Council does not include the kind of consumer protection and property rights representation that taxpaying voters and homeowners might expect.

For example, the following consumer protection and human rights organization are totally missing from the CIC Advisory Council:

  • Fair Housing Councils
  • Veterans rights organizations
  • Senior citizens advocates
  • Private property rights, Constitutional rights attorneys and think tanks
  • Tenants’ rights agencies
  • Homelessness prevention nonprofits

What consumer fraud protection?

And, ironically, for a “Fraud and Consumer Protection” agency, there’s not a single non-trade group position on the Council that advocates for fiscal responsibility, generally accepted accounting practices, prevention of nonprofit financial theft and fraud, or governing ethics in HOAs.

It makes no sense to allow the HOA management industry to set the legal standards for financial recordkeeping, cash handling, and consumer disclosure.

Someone tell Attorney General Kathy Jennings that CAI and builders of association-governed communities do not represent the interests of housing consumers.

Despite their claims to the contrary, CAI only represents the interests of a small percentage of HOA board members who happen to hire and contract with CAI’s community association managers or attorneys.

And policy makers who receive their one-sided “education” from the industry trade group do a grave disservice to their constituents.

To my colleagues hoping to rein in HOA abuse and protect private property rights in their states, proceed with caution.

Delaware’s Ombudsperson and CIC Advisory Council should serve as convincing proof that housing consumer advocates will get nowhere by promoting legislation to create AG oversight of HOAs.