Condo, Strata and HOA News

Category Archives: Texas

HOA vs. Kangaroo – HOA Avoids Bad Press and Possible Suit

The Estates of Legends Ranch, Texas, HOA has jumped back from their decision to oust a kangaroo from the association. The six month old kangaroo named Mike resides with Jeni and Nick Dreis, and their daughter Kayla.

When the HOA found out the kangaroo resided with the family, they issued a demand letter for the animal’s removal. Kangaroos, it seems, are not deemed household animals. As such, they’re not allowed in the HOA.

The HOA relented though, and has allowed the animal to exist at the Dreis residence till the Texas Downs, a special needs education and enrichment facility utilizing a wildlife park and organic farm, is completed (estimated mid 2012).

Honestly, the HOA didn’t have much of a choice. The Texas Downs is founded by the Dreis, and Kayla has Down syndrome. The kangaroo is expected to be transferred to the wildlife park when it becomes habitable for the creature, and in the meantime acts as a companion pet for Kayla.

A simple search on “HOA Kangaroo Dreis” will return 149,000 results – and you can read the massive amount of attention this issue has received. The utter cuteness overload of Kayla and the kangaroo would have been a public relations nightmare if the HOA insisted on enforcing the bylaws (stating the kangaroo isn’t a household pet). The Dreis could have also filed a civil rights suit, as the kangaroo may fit under the Americans with Disabilities Act – which defines a service animal as (and the underline is theirs):

The ADA defines a service animal as any guide dog, signal dog, or other animal individually trained to provide assistance to an individual with a disability. If they meet this definition, animals are considered service animals under the ADA regardless of whether they have been licensed or certified by a state or local government.

I’m personally ecstatic that the HOA has relented on its booting of the kangaroo, and has accepted its bouncy lifestyle until it transfers to the wildlife park. Beyond the public relations issue, it’s OK (really, more than OK) for HOAs to realize that the concept of community is important in an association. That home is more than a house people huddle in, away from their neighbours. It’s a place to form relationships, friendships, and show some decent basic humanity to your fellow neighbours.

The Estates of Legends Ranch has put a great foot forward with their support of the kangaroo. They are to be commended.

Multi-Housing Development OK If Not For The Poor

Residents of the Woodbridge HOA in Sachse Texas have begun to complain that a proposed low-income block will mar their community with lowered property values, an overloaded school system, and a general discouragement of new business.

Sachse is an affluent neighborhood – only 6.5% of the community lives below the poverty level compared to a state average of 17.2%, and their median household income is 70% higher than the state average.

For a zip code that has over 21,500 residents – adding some 350 people (100 low-cost rental units x 3.46 average household size for the region) – increasing the population by 1.6% of low income individuals won’t have any substantial change to the area. Indeed, this might raise the total below poverty individuals to 1750 (including what the residents claim will be 200 new children) or so individuals in the whole community.

Indeed, at that level of “new poor”, along with the location of area – which has been zoned for apartments and commercial development for 10 years – is relatively isolated from the single detached units (you don’t have to drive through the neighbourhood to get to the proposed development), no traffic impact. Indeed – most residents could continue living their lives without ever seeing an actual low-income resident ever step foot on the sidewalk in front of their house. (Though watch out – Google street view shows a suspiciously low income looking van for sale in the Woodbridge community, along with a lot of generic low-cost, 10 year old appearing, cars.)

So – (1) the amount of development, location, and growth on the community should have negligible impact on property values, (2) the area is 70% more affluent than the region so their already have enough of a school tax base to cover new students, and (3) apparently low-income residents drive away discourages new business. That’s so silly I don’t have a better remark.

In a country that welcomed immigrants with the words “Give me your tired, your poor” – they should update it with the tagline “as long as they live far away from me”.

HOA Manager Awards Dad 1.15 Million in Contracts

There’s always such a special bond between a father and son. In this case, that bond comes with 1.15 million in awarded contracts.

Now fired Dallas Texas HOA Holly Oaks Townhomes Association Inc. property manager Jackson Potter funneled work to family members. Handing any work to family members is questionable in any business, but where it involves over a million in contracts it would be prudent to investigative if Mr. Potter acted in the best interest of his client – the HOA – or in the interest of his family, father, and brother.

The conflict of interest includes two really big issues:

One, Mr. Potter and the HOA hired David Potter (Mr. Potter’s father) to represent them in a civil case against an owner. David Potter billed $150,000 in legal work and fees. If I have my cases correct, the amount the HOA sued for was $24,324. That certainly seems like milking a case – brining bills for 6x the amount being sued. It’s also a bad risk – if the HOA loses the case or if the owner being sued cannot cover the judgement, the HOA would be on the hook for those costs.

One method to see if the owner could pay such a legal bill is to review if foreclosing on the owner’s property would cover the legal expenses. The median house cost in Holly Oaks Townhomes (as of 03 July 2010) was $44,450. Nope. The total assessed value of home in the HOA is generally less than one third the legal billings.

Two, when 10 of the units of the HOA in 2010 suffered fire damage – Mr. Potter and HOA hired a company run by (again) his father and his brother. The reconstruction cost – from a photo it looks like a full rebuild on at least some of the units – was 1 million dollars. Remember, the median value of 10 units in the HOA that year was $444,500. That means the value of the units being fixed after the fire was less than one half the reconstruction bill.

Related to this, especially given the size of the contracts, in Las Vegas it appears 16 people so far have entered into plea agreements on charges relating to stacking homeowners association boards with friendly members who would hand out legal work and construction defect contracts at the expense of the associations and their homeowners.

“Hand out legal work and construction defect contracts” – seems an apt or similar description of what Mr. Potter did for his dad.

Losing HOA Sign Case Costs Owners $7000 in Covering HOA Legal Costs

I have often talked about my support of a no-sign rule for condominiums and HOAs, along with the risk owners take if they fight this rule. For Johnnie and Clara Russell of Fort Worth, the judge in their case – which they lost – awarded the defendants, the HOA, legal costs. In this case, the award amounts to $7000 which the Russell family must now pay.

My continuing caution to owners that want to fight no-sign laws: it’s an uphill battle, it’s expensive, and you’re likely going to lose.