02.01.24

ISSUE # 84

CIC Info Bytes 02/01/24

CIC Info Bytes are frequent, succinct updates providing educational and engagement opportunities that help your community thrive!  Please forward and share this newsletter with your peers, neighbors and colleagues so they can connect and join.  Our goal is to curate content that provides a robust basis for contextual understanding to support practical takeaways for you and your association.  Please consider following us on Twitter and Reddit. 

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View the Calendar

• Visit our homepage to view events and add them to your own calendar.

  • Did you miss the first two North Carolina House Select Committee meetings on HOAs?  Listen here: Jan 11 and Jan 24

Want to send feedback?   Email Rep. Frank Iler and his legislative assistant. 

Don’t be Controlled by Inadequate Representation

• We find it impossible to empathize with attorneys who engage in bad behavior, charge $68,000 in fees to collect a $3,800 debt and teach each other how to get away with it.  CAI’s annual law seminar will convene in Las Vegas February 14 to 17.  There’s no love lost kicking off on Valentine’s Day.

Attorneys argue losing cases about 50% of the time.  Sometimes a losing case is waged because their client demands it and attorneys are pleased to take their money.  Other times, attorneys tell clients they have a winning case and it turns out they’re wrong.  NEVER take your attorney's advice, your CAM’s advice, or any other advice without checking it, at minimum, against the plain language of your state statutes and your association’s governing documents.

• Law firms and lawyers are litigation targets now more than ever before.

•  Lawyers are finding everyday actions in practicing law can make them the subject of lawsuits. 

• In May 2020, Carpenter, Hazelwood, Delgado & Bolen, LLP was targeted in a class action lawsuit filed in federal court. The suit alleged the firm violated the Federal Credit Reporting Act. The law firm successfully prevailed after a three-year battle against an aggressive homeowner law firm. Community association lawyers also are being targeted by advocacy groups looking to “protect” homeowners. 

• Owners within associations we represent are filing bar complaints against association attorneys and disparaging lawyers in open board meetings. Being the subject of these attacks can affect how attorneys represent clients. It can make them fear being an advocate can subject them to a claim and tarnish reputations. 

• Join presenters as they walk attendees through one firm’s litigation journey as a defendant, another attorney’s fight against bar complaints, and a third  attorney’s ambush by an owner during an open board meeting. 

Through these stories and lessons, presenters will provide tips on how lawyers and their firms can protect themselves and not fall into a trap or be controlled by fear...

Shielding Ourselves When We Become the Targets — 2024 CAI Law Seminar Presentation

Foreclosure…Mistake

• Greensboro, North Carolina: OOPS!

Delta Adams was told she missed three HOA payments. Adams said that's not true because she has automatic withdrawal and as it turns out, she was right.

…The dues for the HOA were $150 a month and Adams had them automatically drafted from her bank account. The payment process worked fine until one month Adams received a notice that she was being fined for missing the last three HOA payments.

“I thought it was an error at first. I was like that’s not right,” Adams said.

A couple of days later, Adams called the management company to see why she was being fined if she set up automatic withdrawal. A representative said she would have someone investigate the matter and get back to her. The next time she heard from someone it was in the form of a letter threatening foreclosure and legal fees…

A Greensboro woman calls WFMY News 2 after her HOA Management company threatens to foreclose on her home — Kevin Kennedy | WFMY | January 22, 2024

Legislative Intervention

• Why do some homeowner concerns create a public policy response?

In this Article, I suggest reasons why some owner-HOA disputes trigger political intervention, even though most such disputes attract little attention outside the CIC. I argue that homeowner-HOA conflicts are most likely to attract political attention where the owner is a sympathetic litigant able to attract political empathy, and where the rule at issue is intrusive and salient rather than relating to something perceived as of minimal importance. Finally, if the homeowner’s cause aligns with an interest group and does not trigger opposition from a different interest group, the owner’s chance of triggering political change is likely to be significantly increased…

When Homeowners Associations Go Too Far: Political Responses to Unpopular Rules in Common Interest Communities — Ryan McCarl | August 12, 2014

Declined Mediation

• Statistics presented by a 501(c)(3) mediation service during the January 24 North Carolina House Select Committee on Homeowners' Associations.  Most states, including North Carolina, do not require mediation.

HOA United is actively promoting the adoption of required alternative dispute resolution (ADR) in multiple states. 

Industry Mantra

• In his piece from nearly 13 years ago, Tom Skiba (the current CEO of CAI) gives us the industry mantra: CAI is the “national clearinghouse for information, innovations, and best practices in community association development, governance, and management” and that CAI is “America’s advocate for responsible communities…”  Tom goes on to trumpet the “fundamental goals” which include “protecting property values.”

Those are quite flattering words, but they don’t tell the real story.  Economists have debunked the property values myth (see The Property Values Equation from Issue# 80) and CAI’s own actions prove over and over that it’s a business industry trade organization and not the “trusted forum for the exchange of knowledge and information” it claims to be.

Common-Interest Communities: Opportunities for Greater Understanding—and Success — Tom Skiba | Public Administration Review | July 01, 2011

Ethics in Decline

• We highlight ethics in decline as the CAI and CAMICB fail to reliably enforce the most basic ethical standards theoretically required of their “business partners.” 

Americans’ ratings of nearly all 23 professions measured in Gallup’s 2023 Honesty and Ethics poll are lower than they have been in recent years. Only one profession -- labor union leaders -- has not declined since 2019, yet a relatively low 25% rate their honesty and ethics as “very high” or “high…”

Ethics Ratings of Nearly All Professions Down in U.S. — Megan Brenan and Jeffrey M. Jones | Gallup | January 22, 2024

Long-Term Theft

• The Clover Meadows HOA in Bayfield, New Mexico is no stranger to criminal activity.

A former Bayfield resident suspected of stealing tens of thousands of dollars from her homeowners association between 2010 and 2022 pleaded guilty Thursday in 6th Judicial District Court.

Wendy Crane, 43, plead guilty to theft, a class four felony. She was ordered to pay restitution to the Clover Meadow homeowners association in the amount of $63,642.47. She also received two years of probation, which could be shortened at a later date. If probation conditions are not met, Crane would face 2-6 years in prison, three years of parole and fines as high as $500,000…

…“I just want to apologize to the people of the (HOA),” Crane said. “There’s no excuse for what I’ve done. I want to pay them back.” Her voice broke as she acknowledged the struggles in her life that led to the wrong choices. “I took what didn’t belong to me. Please forgive me and let me make this right.”...

Former Bayfield HOA board member pleads guilty to theft — Garret Jaros | The Durango Herald | March 23, 2023

Public Funds for Private Cameras

• Cleveland, Ohio: An upscale neighborhood where some homes sell for over $6MM has asked for $25,000 in grant funds.

A proposal to spend taxpayer money on security cameras and license plate readers for a homeowners association is before Cuyahoga County Council, but if approved it may not get past the county executive.

The request, from Edgewater Homeowners Association in Cleveland, seeks $25,000 to defray the two-year, $47,000 cost of adding license plate readers and upgrading surveillance cameras. Legislation to approve the request was sponsored by Councilman Martin Sweeney and unanimously passed by the Public Safety & Justice Affairs Committee Tuesday afternoon.

…The homeowners association argues the Flock brand cameras would deter crime and help catch criminals who are traveling through their neighborhood, said HOA President Galen Schuerlein.  The camera footage would be available to law enforcement, but also to the homeowners association, Schuerlein said.

The HOA has had surveillance cameras – about 30 of them in 12 locations -- for over a decade, but the aging technology is too low-quality to identify people or license plates of cars that drive through the neighborhood, Schuerlein said….

Cuyahoga County may spend taxpayer money on security equipment for upscale neighborhood — Lucas Daprile | Cleveland.com | January 17, 2024

Don’t use public funds for homeowners association’s security cameras — Michele Sommerfelt Op-Ed | Cleveland.com | January 19, 2024

Pickle Madness

• San Francisco: Remember In A Pickle from Issue# 79?  Consider this part deux.

Presidio Heights is “a rarefied community where Silicon Valley’s elite mingle with affluent families,” a real estate description coos. It is also ground zero of the latest pickleball battle in America.

Legions of paddle-wielders are feuding with the denizens of some of the priciest mansions in the country. 

The skirmish started last summer when Holly Peterson, who lives with her husband, venture capitalist and Hotwire.com co-founder Karl Peterson, in a 107-year-old mansion valued at $29 million, helped launch a petition asking the city to suspend pickleball in a nearby playground called Presidio Wall: “The endless racket threatens the fragile ecosystem and our community’s prestige,” the petition argued…

‘Hell No, We Won’t Go.’ Pickleball Players Battle Silicon Valley Elites — Jim Carlton | WSJ | January 20, 2024

Government Engagement

• Colorado: Housing affordability requires more engagement like this.

Aspen-Pitkin County Housing Authority board members discussed two measures related to home repairs for aging affordable housing units…

…Participation in the study will be voluntary for HOAs. Gillen said HOAs that choose to be a part of the study will benefit from increased data on their financial capabilities. 

APCHA Board Chair Carson Schmidt said the study will allow local governments to make more informed decisions regarding affordable housing repairs in the future. Pitkin County Commissioner and APCHA board member Kelly McNicholas Kury said a study of APCHA HOAs’ capital reserves is a “top priority” for Pitkin County, the city of Aspen and APCHA.

The city and APCHA are currently engaged in a lawsuit with the Centennial Condominiums Homeowners Association regarding alleged construction defects and water damage at the Centennial Condominiums affordable housing development. Centennial Condominiums HOA members have argued that they do maintain necessary reserves to address repairs, but that their repair costs are beyond what they could possibly afford, especially given the limits to their property values imposed by deed restrictions. 

APCHA’s effort to assist homeowners with repairs is more direct. The housing authority’s new essential repairs pilot grant program, initiated in October, provides up to $10,000 in grant funding for homeowners within the APCHA system to make home repairs deemed essential to the health and safety of residents…

APCHA talks home repairs for owners, HOAs — Austin Corona | Aspen Daily News | January 19, 2024

Centennial HOA: How is affordable housing to be cared for? — Guest Commentary | Aspen Times | August 31, 2023

Structural Reforms

• 56 pages dedicated to condominium structural safety reform.  Will legislators across the United States apply the same rigor to governance reforms?

CONCLUSION: Condominium safety is an issue of importance to millions of Americans. The Champlain Towers tragedy is a painful reminder that dangers not apparent to the untrained eye may impair the structural integrity of high-rise buildings, and that condominium boards, if let to their own devices, may blind themselves to the attendant risks.

The tragedy has alerted governments, insurers, and mortgage bankers to the importance of building inspections. But inspections alone do not ensure that condominium associations will devote the resources necessary to address structural issues – in part because of the affordability constraints facing a percentage of unit owners. Creative approaches to condominium finance may increase the willingness of financially strapped owners to support needed repair – and may also enable them to remain in their homes.

A New Framework for Condominium Structural Safety Reforms — Stewart E. Sterk and Reid K. Weisbord | UC Irvine Law Review | March 13, 2023

ORNL and NREL Modeling Finds Installing Geothermal Heat Pumps in About 70% of US Buildings Could Reduce Need for New Long-Distance Transmission Lines by 33%.

New Analysis: Geothermal Heat Pumps Key Opportunity in Switch to Clean Energy — DOE | CleanTechnica | January 27, 2024

This study analyzed the impacts of mass GHP deployment on the electric grid through capacity expansion modeling and production cost modeling of the US electric power sector. The analysis includes a simplifying assumption that GHP deployments in this study were for individual buildings (not district-scale and/or networked systems)...

Grid Cost and Total Emissions Reductions Through Mass Deployment of Geothermal Heat Pumps for Building Heating and Cooling Electrification in the United States (Technical Report) — DOE Office of Scientific and Technical Information | CleanTechnica | January 27, 2024

Figure ES-1. Geospatial representation of the percentage changes in (left) building annual electricity consumption and (right) carbon emissions (from on-site combustion in buildings) resulting from deploying GHPs into 68% of existing and new residential and commercial buildings in the United States, coupled with weatherization in single-family homes. 

The Cost of Net Zero

• Gaslighting over for now.

…On Monday, the fight ended with a new Energy Department regulation that would modestly tighten efficiency requirements for a small fraction of gas stoves on the market. The consensus rule appeared to please stove manufacturers, energy-efficiency advocates, consumer groups and utilities — but didn’t quite quell the partisan row that had flared up over the stoves a year ago, in just the latest culture-war battle over President Joe Biden’s attempt to move the U.S. to a clean-energy economy…

…The DOE rulemaking marked a first-of-its-kind efficiency effort for gas stoves. As many as roughly half the models on the market may have failed to meet the original proposal that DOE floated last year — but the final rule issued Monday turns down the heat. The new rule will require only a small portion of models to make “modest” improvements to match the level of energy efficiency demonstrated by the majority already on the market, according to the department. Compliance will be required in newly manufactured models, including imported ones, beginning in 2028…

The gas stove fight finally flames out — Kelsey Tamborrino | Politico | January 29, 2024

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The Federal Emergency Management Agency (FEMA) announced that it’ll start reimbursing local governments for installing solar panels and more efficient appliances after a disaster strikes….

As the increase of extreme weather hazards become more severe due to climate change, we need to adapt the way we are helping communities rebuild post-disaster,” FEMA administrator Deanne Criswell said in a press release. During the 1980s, the US suffered an average of 3.3 disasters per year that each cost over $1 billion in losses. That’s risen to an average of 20.4 such disasters each year since 2019 (adjusted for inflation)...

FEMA will pay states to install solar panels and heat pumps — Justine Calma | The Verge | January 30, 2024

Environment

• Melting… 🧊🫕🫠

The Greenland ice sheet, an expanse of frozen water about three times the size of Texas, is disappearing much faster than previously thought, according to new research, and the difference may already be affecting the distribution of heat around the world.

The mass of ice lost between 1985 and 2022 has been underestimated by as much as 20%, or more than 1,000 gigatons (1 trillion metric tons). That’s due to the overlooked impact of calving around Greenland’s perimeter, where the sheet’s glaciers meet the sea, scientists wrote in an article published Wednesday in Nature.

Melting Greenland Has Lost 1 Trillion Tons More Ice Than Thought — Danielle Bochove | Bloomberg | January 17, 2024

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Governor Phil Murphy (D-N.J.) and New Jersey state legislators touted a new law banning plastic and paper shopping bags at stores when they enacted it in 2020. According to a new study, however, passage of New Jersey’s anti-plastics law has been followed by a near tripling of plastic consumption at Garden State checkouts….

…The Freedonia Group study, which was commissioned* by the American Recyclable Plastic Bag Alliance, found that the reusable bags New Jersey shoppers have been forced to use since the bag ban took effect in May of 2022 are rarely reused, only two to three times on average. With many people in New Jersey now using reusable bags as single use bags, the state’s plastic and paper bag prohibition, though passed with the best of intentions, may be doing more harm than good in practice.

Reusable bags are manufactured with 15 to 20 times the amount of plastic used in the now prohibited single-use plastic bag, notes the Freedonia report. The reusable bags that New Jersey residents now pay for at checkout or when their groceries are delivered, according to researchers, need to be used anywhere from 11-59 times in order to have a net benefit for the environment. The Freedonia study found most reusable bags are used an average of two to three times. As a result, overall plastic usage for bags in New Jersey has risen.

Aside from failing to achieve its plastic mitigation objective, the new Freedonia study documents how New Jersey’s plastic and paper bag ban has created a new revenue stream for retailers, one funded by what is effectively a regressive tax on New Jersey households. In fact, the study found one retailer with 50 stores across New Jersey made an estimated $42 million off reusable bag fees alone. The new source of revenue is nice for retailers, but it’s coming from what is effectively a tax on New Jersey residents, disproportionately harming to those who can least afford it.

The Freedonia study found retailers are charging consumers 200% to 300% of the cost reusable bags, which is how businesses are profiting off the plastic and paper bag prohibition enacted in Trenton nearly four years ago. Freedonia’s Retailer Cost Analysis found New Jersey retailers are collecting an estimated $200,000—800,000 annually from each location from reusable bag fees. In fact, the report estimates reusable bag fees now comprise 1-2% of total revenue for New Jersey retailers….

New Jersey Bag Ban Followed By Increased Use Of Plastic — Patrick Gleason | Forbes | January 22, 2024

Freedonia Report: New Jersey Single-Use Bag Ban Boosts Alternative Bag Production, Increases Plastic Consumption, and Drives Retailer Profits

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Urban gardens are generally more carbon intense.

Fruits and vegetables grown in urban gardens in Europe and the US have a carbon footprint six times larger on average than the same produce grown on conventional farms, according to researchers…

Researchers tracked greenhouse gas emissions from farm infrastructure, supplies and irrigation water through daily diary entries made during the 2019 season. They found that on average, food grown in city gardens emitted 0.42 kilograms (0.9 pounds) of carbon dioxide equivalent per serving, compared to 0.07 kilograms of CO2 equivalent per serving for food from conventional farms.

However, some crops proved to be less carbon intensive when grown in cities than on conventional farms. Urban tomatoes often outperform conventional tomatoes, mainly due to the energy intensity of commercial greenhouses. Highly perishable conventional vegetables like asparagus, which are often distributed by plane, also have an equal or higher carbon footprint than the same crops grown in cities....

About 20% to 30% of global city dwellers engage in some form of urban agriculture, most of which takes place in soil on open-air plots. Growing food in cities has benefits such as mitigating higher temperatures from heat-trapping asphalt and concrete, known as the urban heat island effect. It also provides key social and health benefits to people involved — boosting their mental health, improving their diets and strengthening local social networks…

Urban Farming Has a Surprisingly High Climate Toll — Laura Millan | Bloomberg | January 22, 2024

Seattle Public Utilities (SPU) announced that all batteries are banned from the garbage, because of risks to the environment and the public.

The ban, which took effect on Jan. 1, prohibits batteries, items with batteries embedded in them, and electronics such as computers, monitors, and TVs from being disposed of in the garbage. This includes small button cell and alkaline batteries to lithium-ion batteries used in e-bikes and electric vehicles…

…SPU said it won't be handing out any fines to customers who don't follow the new rule because workers don't have the time to go through people's trash to hold them accountable,

 "There isn't any way for our staff to do that practically and collect all the city's garbage and recycling," said McKenna Morrigan, policy advisory for SPU. "So we're really counting on residents and businesses to do their part."

Batteries are not allowed in the garbage after new ban takes effect in Seattle — Staff | KING 5 | January 29, 2024

The easiest way for Seattleites to get rid of batteries, according to Seattle Public Utilities, is to schedule a pickup for special items. Seattle's special items pickup program can haul away a variety of materials, including batteries. For $5, customers can schedule to have up to two 1-gallon bags filled with batteries picked up.

"As long as the batteries aren't damaged at all, it's fine to save up so you have a collection of batteries. If you have any batteries that are corroded or leaking or damaged in any way, the best thing to do is to get those batteries collected right away."

What to do with all the batteries that Seattle has banned from your garbage? — Dyer Oxley | KUOW | January 31, 2024

• BILLION$: damage and property insurance premiums are all escalating.  

Expected Annual Damage (EAD). In the 2020 projection period (which generally captures current climate conditions), homes with federally backed mortgages face EAD of $9.4 billion, CBO estimates. That amount would rise by about one-third to $12.8 billion (in 2020 dollars) in the 2050 projection period if all factors other than the climate remained unchanged. Under a lower climate change projection, EAD in the 2050 period is $10.2 billion; under a higher one, EAD is $16.1 billion.

Total Expected Damage Over a 30-Year Period. To illustrate how expected flood damage over many years of ownership would compare with the property value, CBO calculated the present value of experiencing EAD each year for 30 years. The total expected damage over a 30-year period to homes with federally backed mortgages rises from $190 billion (in present-value terms) in the 2020 period to $258 billion in the 2050 period.

Flood Damage and Property Values. Properties accounting for about 7 percent of the total value of properties with federally backed mortgages face a risk of flood damage each year in the 2020 period. Among those homes, the total expected damage over 30 years is about 14 percent of the total property value. Among all homes with federally backed mortgages, that share is 1 percent.

Flood Damage and Federally Backed Mortgages in a Changing Climate — Congressional Budget Office (CBO) | November 2023

• Boomer or bust?  Selling and downsizing isn’t easy or appealing in many cases…

Many Boomers whose homes have surged in value now face massive capital gains tax bills when they sell. This is a kind of tax on the profit you make when selling an investment or an asset, like a home, that has increased in value.

Plus, smaller homes or apartments in the neighborhoods they’ve come to love are rare. And with current prices and mortgage rates so high, there is often a negligible cost difference between their current home and a smaller one.

Boomers are not moving out of their big homes, here’s why — Anna Bahney | CNN | January 29, 2024

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Mortgage rate relief in sight.

Mortgage rates in the US will decline this year, stoking optimism about the battered real estate market, according to the latest Bloomberg Markets Live Pulse survey.

The rate on a 30-year, fixed mortgage is expected to fall to 5.5% at the end of the year, according to the median from 236 respondents. That’d be down more than a full percentage point from its current level of about 6.69%, and the first annual decline after three straight years of gains…

…It will likely take a much more significant drop to unlock the market. Only a tenth of survey participants said a 6% rate would produce a meaningful increase in single-family inventory. Another 39% said borrowing costs around 5% would be enough…

Mortgage Rates in US to Drop to 5.5% in 2024, Survey Shows — Natalie Wong and Prashant Gopal | Bloomberg | January 28, 2024

Built Environment

• Calculating mass timber benefits is far from straightforward.

Building-specific LCAs [life-cycle assessments] define the construction process — say from harvest to end-of-life disposal — and estimate who’s responsible for how many emissions along the way. But that’s not the kind of analysis that environmental researchers do, so may not be the most informative one in terms of global carbon, says Danny Cullenward, a senior fellow at the University of Pennsylvania’s Kleinman Center for Energy Policy.

An LCA is simpler than a land-use analysis but misses meaningful system-level insight, Cullenward says. It misses the complexity inherent in a biological system like a forest. 

Just How Climate-Friendly Are Timber Buildings? It's Complicated — Eric Roston | Bloomberg | January 24, 2024

Almere, The Netherlands.  Building of the Year 2024!

Highnote Residential Tower / Studioninedots — Paula Pintos | ArchDaily | January 2024

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Skymart, anyone?!

Decades ago, business leaders in Morristown, Tennessee, came up with a radical infrastructure plan to rescue their struggling Main Street. Here’s how it worked out…

Morristown: Why a Tennessee Town Built a Skywalk to Rescue Downtown — David Zipper | Bloomberg CityLab | January 24, 2024

• Federal deficits are in a “terrible place.”

“The risks are enormous and some of them are materializing already, like higher interest rates,” Rubin said Wednesday on Bloomberg Television’s Wall Street Week with David Westin. The roughly 3-percentage-point surge in longer-term Treasury yields in recent years is due in part to the fiscal outlook and its impact on inflation, he said.

Risks are even greater today than in the early 1990s, when incoming President Bill Clinton crafted a budget-tightening package to shrink the deficit, Rubin said. The danger is that when markets are “out of sync with reality,” they can then “correct savagely” — as happened when Greek bond premiums over German ones soared during the euro crisis, he said.

Ex-Treasury Secretary Robert Rubin Sees 'Enormous Risks' to US Federal Deficits — Viktoria Dendrinou | Bloomberg| January 24, 2024

Inflation and Monetary Policy

• Inflation receding.

US inflation is set to further recede in 2024, ending the year near the Federal Reserve’s 2% target as economic disruptions from the pandemic fade further and prices of some goods even decline.

The downdraft should keep the US central bank firmly on course for lower interest rates, with cuts expected to come as soon as March. President Joe Biden, for his part, may have a harder time capitalizing politically on the campaign trail, especially if lower inflation comes alongside a broader slowdown in the economy.

The December report on consumer prices, released by the US Bureau of Labor Statistics Thursday, will probably give a taste of the disinflation to come in the months ahead. Goods prices overall have stopped rising and some, like those for cars, are falling…

US Inflation Rate Is Set to Fade in 2024 as Goods Prices Keep Falling — Matthew Boesler | Bloomberg | January 10, 2024

This week provided more proof that the US economy is steaming ahead in the face of more than a year of gloomily incorrect predictions. Economic growth in the fourth quarter trounced forecasts and gross domestic product increased 2.5% for the year. You may recall that 2023 opened with economic experts jostling for air time to warn the public of a guaranteed American recession. But the year ended with a US expansion rate that added about a South Korea’s worth of GDP to the world. On Friday, there was even more good news for the US on the inflation front. The Federal Reserve’s preferred gauge of underlying price pressures, the so-called core personal consumption expenditures price index, cooled to an almost three-year low in December, even with robust holiday spending. That report capped a year in which inflation retreated at a much faster rate than the Fed (and certainly Wall Street economists) anticipated, all while a sturdy job market kept powering consumer spending. You could call it the Teflon economy.

US Economy Closes Out ‘Remarkable’ Year — Victoria Cavaliere and Ian Fisher | Bloomberg Weekend Reading | January 27, 2024

Fed's Preferred Inflation Gauge Cools on Robust Spending — Augusta Saraiva | Bloomberg | January 26, 2024

Federal Reserve officials start the year with a problem they would ordinarily love to have: Inflation has fallen much faster than expected.

It does, nonetheless, pose a conundrum. The reason: If inflation has sustainably returned to the Fed’s 2% target, then real rates—nominal rates adjusted for inflation—have risen and might be restricting economic activity too much. This means the Fed needs to cut interest rates. The question is, when and by how much.

The Fed won’t cut at its two-day meeting ending this Wednesday because the economy has been growing solidly. While inflation excluding food and energy on a monthly basis has been at or below 2% in six of the last seven months, the Fed wants to be sure that can be sustained before cutting rates.

Instead, Fed officials are likely to take a symbolically important step this week by no longer signaling in their policy statement that rates are more likely to rise than fall. Ditching this so-called tightening bias would affirm that officials are entertaining lower rates in the coming months.

Plummeting Inflation Raises New Risk for Fed: Rising Real Interest Rates — Nick Timiraos | WSJ | January 28, 2024

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• De-stigmatizing bank stability:

Almost a century after the US Federal Reserve first tried to discourage regular bank borrowing from its traditional backstop program—known as the discount window—officials now are trying to rebrand the primary credit facility as a source for everyday liquidity. The problem with that is banks remain leery of doing so, given the stigma associated with it. As one might expect, the Fed’s effort is being driven in no small part by last year’s regional banking bloodbath, led by the collapse of Silicon Valley Bank. Regulators were shocked by the rapid flight of deposits, but also that SVB and other lenders were ill-prepared to even access the discount window, instead relying heavily on Federal Home Loan Banks. Now regulators, including the Fed, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. are drafting a plan to require that banks tap the facility at least once a year, a measure aimed at removing the perceived red flag associated with its use. “Banks need to be ready and willing to use the discount window in good times and bad,” Fed Vice Chair for Supervision Michael Barr recently said. 

— David E. Rovella | Bloomberg Evening Briefing | January 26, 2024

Cashing Out

• Americans' lack of savings is an ongoing challenge.

Nearly half of Americans have $500 or less in their savings accounts, an amount that leaves them vulnerable to unexpected expenses, according to a GOBankingRates survey of 1,063 U.S. adults conducted in November 2023.

About 29% of respondents have between $501 and $5,000 in their savings accounts, while the remaining 21% of Americans have $5,001 or more.

Few hold much cash in their checking accounts as well. Of those surveyed, 60% report having $500 or less in their checking accounts, while only about 12% have $2,001 or more…

How much money Americans have in their savings accounts—nearly half have less than $500 — Mike Winters | CNBC | January 24, 2024

How Much Money Do Americans Have in Their Bank Accounts in 2024? — GOBankingRates

Livestock Lawsuit

• Ventura Maintenance Association in San Antonio, Texas.

…In August, Ventura sued homeowner William Wade, his wife, Amanda, and tenants Richard and Ja’Net Hayes, alleging they had been keeping “various unauthorized animals” — including “a horse, goats, chickens and most recently ducks” — on the property since about April. The Wades live in Arizona; the Hayes family has rented the house for about five years and have a right to purchase it.

Prior to filing suit, the homeowners association sent multiple letters requesting the animals be removed. But Crist said the Hayeses “continued to accumulate additional animals, most recently the ducks.”

…He acknowledged they had a horse, two Nigerian goats, another goat and two ducks on the property at the time of the hearing. “The chickens have been gone forever,” he said….

Goats and a duck and a horse, oh my! HOA sues homeowner, tenants over backyard menagerie

— Patrick Danner | San Antonio Express News | January 18, 2024

NDA?  No Way!

• Your community association Board does not have the authority to require homeowners or volunteers to sign an NDA.  Period.

NDA for Board Members — u/Hoaallday | r/HOA | January 19, 2024

Morbid

• Care for your property, including your cemeteries.

A Buckhead homeowner’s association is failing to take care of a historic Black cemetery near its property, according to claims made in a lawsuit.

The lawsuit claims the Bluffs at Lenox Homeowners Association (HOA) is not maintaining the Piney Grove Cemetery on Canterbury Road despite promises to do so. A new lawsuit by descendants of people buried in the cemetery is seeking to force the HOA to take care of the cemetery…

Lawsuit: Buckhead HOA failing to take care of historic cemetery — Ellie Parker | ANF | January 18, 2024

Right to Build

• Cornwall, Connecticut: The Coltsfoot Valley Association does not want a new home built on an empty lot.  The plaintiffs began with counsel, but are now pro-se.

A contentious conflict between a Connecticut couple and a homeowner’s association in a historic section of rural Cornwall, where some multi-acre properties are valued over $1 million, has grown to become an extensive and expensive court case, showing that it’s not always easy to build houses in Connecticut, even if you have the money…

Couple battles HOA in Cornwall over the right to build a home — Marc E. Fitch | CII Inside Investigator| January 17, 2024

MELK, LISA MARIE Et Al v. COLTSFOOT VALLEY ASSOCIATION, INC.

Don’t Deny It: Fair Housing is Serious Business

• Long Beach, California.  We first covered this case in October 2022.  Now it’s headed to jury trial for monetary damages, but there’s now a painful consent decree in place.  Great summary in “what you need to know:”

  • If a handicapped person asks for a parking spot to accommodate a disability, grant it unless you have a legal opinion that you don’t need to. 

  • Contesting a reasonable accommodation case can be time-consuming and expensive, even if you win. If you lose, it’s even more expensive.

Parking for Handicapped Individuals – Denying a Reasonable Accommodation is Costly

— Daniel Miske | Husch Blackwell LLP | December 28, 2023

CV 23-02498-SB-JPR: United States v. Aqua 388 Cmty. Ass'n — January 22, 2024

DOJ: United States v. Aqua 388 Community Association, et al. (C.D. Cal.)

Don’t Feel Bad

• Los Angeles, California.  Beverly Park North HOA.  It’s challenging to empathize…

James Harden Files Cross Complaint vs. HOA in Damaged Mansion Suit — Daniel Miske | MyNewsLA | January 23, 2024

Coastal Litigation

• Half Moon Bay, California.  Casa Mira Condominium Association.

The fate of California’s coast may hinge upon the outcome of a contentious ongoing lawsuit in which a small group of homeowners is battling to build a sea wall that the state has refused to approve.

Rising sea levels are threatening to eat away much of the state’s 1,100-mile shoreline, while potentially destroying many of the homes and businesses that have been built alongside it.

In a case that has pitted public beaches against private property rights, the resolution of a regulator-residential rift could help clarify who is allowed to shield their properties from this encroaching danger — and in doing so, make a far-reaching impact on the future geography of the state’s bluffs, beaches and coastal communities…

How a homeowners association lawsuit could shape the future of the California coast — Sharon Udasin | The Hill | January 18, 2024

State officials wouldn’t let these homeowners build a sea wall. Their lawsuit could reshape California’s coast

— Paul Rogers | Santa Cruz Sentinel | January 07, 2024

The Tribunal Has Spoken

• Avid readers know we’re huge fans of the Condominium Authority of Ontario and its Tribunal (CAT) because it’s a system that generally WORKS for all parties involved.

In this case, the CAT ordered an association to:

• replace its garage door system with a newer, quieter version within 90 days

• Pay some of the applicant’s costs for expert reports and legal fees

…the particular wording of section 3.1 in the Respondent’s declaration has sufficient breadth to impose upon the Respondent [the Association], in so far as it acts on behalf of all unit owners in accordance with the Act, a duty not to allow a condition that unreasonably interferes with the use and enjoyment of the common elements or their units by any of the owners.

NOTABLY: The CAT generally will not order one Party to reimburse another Party for legal fees or disbursements (“costs”) incurred in the course of the proceeding. However, where appropriate, the CAT may order a Party to pay to another Party all or part of their costs, including costs that were directly related to a Party’s behaviour that was unreasonable, undertaken for an improper purpose, or that caused a delay or additional expense.

File# 2022-00509N: Kimel v. Toronto Standard Condominium Corporation No. 2026

Condominium Authority Tribunal (CAT) Guide to Effective Negotiation

No, Just No!

• Yikes!  This 34 page academic paper considers the lack of authority to “evict” owners from their real property.  Reasonable laws have identified ways to address less than desirable behavior such as the power to remove consistently disruptive members from meetings.

Penalties are punitive.  The community association ecosystem needs reasonable remedies within reach to help everyone successfully enforce the law and governing documents.

…While one of the main features of living in a condominium or HOA is that the unit or property owner owns their parcel in fee simple, this also creates issues for the board of a condominium or HOA when dealing with unruly residents. For example, if there is a unit or property owner who continuously disturbs the community by making threats, getting into physical altercations, or exhibiting nuisance-like behavior, the board does not have the ability to evict that unit or property owner, no matter how disturbing this behavior may be. This is because of the fee simple ownership of the unit or property. While condominiums, HOAs, and co-ops are all common interest communities, one of the major differences is that co-ops have the ability to evict a tenant/shareholder for exhibiting such behavior, because a tenant/shareholder living in a co-op does not own their unit in fee simple and is instead bound by a proprietary lease which can authorize termination of a tenancy.

When dealing with an objectionable unit or property owner living in a condominium or HOA, the board of a condominium or HOA, unfortunately, does not have many choices. They may be able to fine the unit or property owner, but the only way they would be able to evict that owner is if they do not pay that fine, the board places a lien on the unit, and then the board eventually forecloses on that unit. Those living in a condominium or HOA may need a faster and more efficient solution when dealing with such an unruly resident in order to protect the community at large…

What a Board Wants, What a Board Needs: A New Way to Evict a Property Owner for Bad Behavior in Common Interest Communities

— Amanda Ricci | Hofstra Law Review | June 1, 2023

• Washington State: In addition to SB5796 (see WUCIOA.info) and HB1054, heat pumps are getting the same treatment as EV chargers in SB5793.

• Nebraska is considering several bills this session as it looks to follow many other states to curtail unreasonable restrictions related to solar panels and political signs.

…Concerned about the environment, in part after studying Pope Francis’ encyclical that climate change is real and that we must care for our “common home,” Rosalind Carr took action.

In October, Carr had 14 solar panels installed on the roof of her townhouse in the Cape Charles Square neighborhood of south Lincoln.

The reaction, however, wasn’t that good from some neighbors and the homeowners’ association that governs the neighborhood.

The Cape Charles Square Homeowners Association ordered Carr to remove the solar panels, or the association would do it for her, because she hadn’t gained permission from the HOA board, as required in the local covenants, to install them…

Installation of solar panels gets Lincoln condo owner in hot water — Paul Hammer | Nebraska Examiner | February 23, 2023

___________________

…The signs in question must advertise candidates or ballot measures pertaining to an upcoming election, and the proposed ban only applies for the 90 days prior to that election and 10 days following it, according to the legislation.

The bill also clarifies that HOAs can impose restrictions on how signs are displayed, and limit each owner to one sign per candidate or ballot measure. Signs that are larger than four feet by six feet, contain offensive material, threaten public safety or pose a distraction to passing motorists would not apply to the new rule.

Conrad said there is a plethora of past case law relating to political signage, including some cases that made it to the U.S. Supreme Court. In most cases, she said, courts have protected the rights of free speech, with political speech being the highest valued. However, HOAs have been left in a gray area, as they do not count as a governing body, she said.

“What’s most important to remember about this measure, because I really see it as having two quintessential, key issues … in it — the importance of private property, and the importance of free expression,” Conrad said.

Nebraska bill seeks to prohibit homeowners associations from banning political signs — Erin Bamer | Omaha World-Herald | January 26, 2024

• North Carolina’s House Select Committee hearings are turning up the heat along with bills introduced last year like HB542 and HB311.

They say a man’s home is his castle. But what happens when that castle is under the rule of an unruly homeowners’ association?...

After years of waiting, NC homeowners push legislators to rein in powerful homeowners associations — Clayton Henkel | NC Newsline | January 29, 2024

Homeowner angst: North Carolina lawmakers urged to address growing HOA complaints — Clayton Henkel | NC Newsline | January 16, 2024

• Pierre, South Dakota: SB39 would prohibit a homeowners' association from placing restrictions on firearms or firearm ammunition.

• SCOTUS declined to hear a challenge to Seattle’s criminal background check ordinance (which was previously upheld in part and reversed in part by the 9th circuit).

Seattle Banned Landlords From Rejecting Tenants Based on Criminal Records. Will the Supreme Court Step in? — Gabriel Ogunjobi | Reason | December 1, 2023

Ninth Circuit guts Seattle ban on criminal checks for potential tenants — Alanna Mayham | Courthouse News Service | March 21, 2023