Friday, June 13, 2003 | 11:21 a.m.
CARSON CITY -- Homeowners with complaints about their homeowners associations -- ranging from missing funds and kickbacks to harassment of residents -- now have a place to turn.
With the signing into law this week of Senate Bill 100, a state commission will be established to hear complaints about association boards of directors. The law goes into effect Oct. 1.
"These are governments and they have the power to tax and fine," said Sen. Mike Schneider, D-Las Vegas, who sponsored SB100. "And we have got to get them under control."
Eldon Hardy, ombudsman for the homeowner association, says his office receives 1,500 telephone calls a month from dissatisfied homeowners who feel they are abused by the elected board that rules the units.
Hardy, with his staff of three, try to mediate some of the complaints but there is no enforcement power.
"Big changes will soon be available to the homeowners," with the bill, Hardy said.
Schneider said SB100 will level the playing field and serve as a model for the rest of the nation.
The complaints from homeowners are legendary in Southern Nevada, he said. He received a complaint Thursday from a female homeowner who says the directors want to raise the association fees, and $16,000 is missing. But she can't get an explanation from the association, Schneider said.
There are complaints of hundreds of thousands of dollars missing from homeowner associations; of an association member hiring a relative for work in the unit and then getting a kickback; and of homeowners being fined and harassed for failure to pay their dues, even though they have canceled checks to prove the payment, Schneider said.
Gary Milliken, a lobbyist representing the Community Association Institute involved in managing some of these common interest communities, said the new law gives homeowners a place to go and tell the new commission their story. He said efforts have been made for the past three sessions to get this legislation.
The state ombudsman didn't have the staff or the authority to handle these problems, he said.
Grievances against associations involve such things as prohibition on flying an American flag at the home, parking a car in the wrong place or conflicts over putting up a mobile basketball backboard and not taking it down at night.
Renny Ashleman, a lobbyist for the Southern Nevada Homebuilders Association, said in one case a daughter moved into a home to take care her ailing parents. The mother and father died. The homeowners association sought to evict the woman, who was 52 years old, because the restrictions say a resident must be 55. The woman declined to pay the dues and now owes $3,000.
Milliken said some of the rules make sense, but some homeowners associations go too far. "Some boards get carried away with enforcement," he said.
Ashleman said that there "is not a lot of common sense," used in dealing with the disputes between homeowners and the associations.
Hardy, the ombudsman, estimates there may be as many as 1 million people in Nevada living under homeowner associations, far too many for his staff to serve. "We have four people to deal with 1 million people," he said.
He estimates there are 2,500 to 3,000 common interest communities in the state but only 1,500 have complied with the law to register with his office. Between 75 percent and 80 percent of them are in Clark County, he said. Last year the estimate was there were 875,000 people involved with homeowner associations, he said. And that number has increased this year with the continued construction.
With this new law, Hardy will be able to hire six additional staff members, placing one in Northern Nevada for the first time. The money is there. The associations pay a yearly fee of $3 per unit to the state, building up a fund of about $1 million.
Hardy estimates that about $500,000 will be used by this new commission.
It will be a five-member commission appointed by the governor and must include an attorney, a certified public accountant and others involved in the homeowner associations. One must be a member who has been involved in developing common-interest communities, one who holds a permit to manage property and one who is a unit owner and who has served as a member of an executive board.
The commission can appoint hearing panels to listen to complaints. A person who files a false complaint can be fined $1,000.
Schneider said the commission will have the authority to remove a board member or the entire board if it finds cause. Or it may issue fines up to $1,000. The commission, if it finds a violation, may order an audit of the association or require the association to hire a community manager who holds a permit.
If the association persists in violations, the commission may ask a court for an injunction.
To reach the state homeowners association ombudsman, call (702) 486-4033, ext. 282, or see the website at red.state.nv.us/CIC--ombuds.htm
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