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October 2, 2006

The Senate Intergovernmental Relations Committee held a public hearing on the charge to review the Texas Uniform Planned Community Act or TUPCA. Texas Homeowners for HOA Reform, Inc. was added to the agenda as a resource. Beanie Adolph gave testimony as representatives of Texas Homeowners for HOA Reform. During their testimony Senator Royce West, the newly appointed Chairman of the IGR Committee responded to claims that homeowners were not represented in the writing of TUPCA by appointing Beanie to the panel reviewing TUPCA. Those already on the panel included:

Sharon Reuler, Texas College of Real Estate Attorneys

Connie Heyer, Texas Community Associations Institute

Susan Wright, Texas Association of Builders

Tom Morgan, Vice President of Legal Affairs, Texas Association of Realtors

The Senator's instructions to the panel were to talk among the members of the panel and finds those areas in TUPCA where the panel could come to an agreement, and those areas where the panel could not agree on should be submitted to the IGR Committee. David Kahne, a Houston attorney and homeowner rights advocate, and Harvella Jones, founder of Texas Homeowner's Advocate Group, was later added to the panel.

During her testimony, Beanie Adolph listed just a few reasons legislators should not support TUPCA. Below is her testimony.

We do not like TUPCA. TUPCA is contrary to the Texas Constitution. Article I - Bill of Rights, Section 26: "Perpetuities…are contrary to the genius of a free government and shall never be allowed…"

TUPCA 83.004 states: "…the rule against perpetuities does not apply…"

TUPCA 83.151 - "…the rights listed…are not exclusive or intended to limit the rights guaranteed by the Constitution and laws of the United States and this state." Yet section after section gives unlimited powers to the HOA board.

Sec. 83.067 states that the governing documents will be liberally construed in favor of the organization - not the homeowner. I've been here almost 50 years and I know that this is totally contrary to Texas law - an individual rights state. Governing documents should exist to serve homeowners, not the association.

TUPCA 83.113 - Architectural standards means a person or persons with power to approve or deny applications for proposed construction, etc. Here you have American homeowners who have bought their homes, hold responsible jobs, raise their children and TUPCA forces them to be subject to an unknown entity who will control their lives.

TUPCA 83.114 - Accumulation of Assessments. This is a booby-trap for homeowners and a boon to the greedy industry. Most homeowners are on budgets and cannot bear a sudden demand for exorbitant assessments with the alternative being foreclosure. This appears intended to overrule the Brooks case where the Supreme Court ruled 9 - 0 for homeowners. Associations don't need this power. It encourages excessive spending without accountability to the homeowners who pay the bills.

TUPCA 83.116 - Foreclosure - Obscene for an HOA to have this power. Nobody else does - not doctors or other professions - not even Enron. But TUPCA makes it worse: "A court may not set aside a sale under this section solely because the purchase price at the foreclosure sale was insufficient to fully satisfy the former owner's debt to the association."

TUPCA 83.204 - puts the burden of disclosure on the seller of the property to advise the purchaser of HOA rules and assessments. Sellers won't do this correctly. That won't protect buyers. -Buyers won't know what CAI knows. On this I agree with CAI's Dick Spears who said buyers "surrender their civil rights". He said buyers do it voluntarily. We say buyers don't know.." Do you honestly believe that Texas homeowners voluntarily surrendered their civil rights when they bought their homes?

There are major problems with Property Code 204. Our website www.HOAdata.org. shows how foreclosure lawsuits grew in Harris County alone after passage of 204. At first 204 only applied to Harris County. It's bad enough that 204 was recently expanded to adjacent counties. TUPCA would make this a truly statewide problem. TUPCA says it must be statewide. We from Harris County are here to warn all Texans that TUPCA takes away basic property rights. TUPCA means a homeowner does not own his own home. Do your constituents know what you are considering? Do your children, grandchildren, relatives and friends know that you are considering denying them their rights "in perpetuity"?

As TUPCA states - 83.012 - Uniformity of Application: - Any amendment… to limit this application to less than the entire state, e.g. population or geography is void.

For decades basic Texas law has said that deed restrictions must be clear and that limitations on the use of property are disfavored. TUPCA 83.067 has overturned this. TUPCA says the DRs don't have to be clear.

TUPCA 83.116 (a) creates the right to foreclosure even if it is not in the deed restrictions. That should violate the Texas Constitution because even Inwood and Brooks require the right to foreclose be included in the deed restrictions.

TUPCA 83.116 (b) seems to allow an association to sell your house by non-judicial foreclosure without going to court and even allows the association to buy the house at firesale prices. That creates a real incentive to trump up and boost the fees. Look at the long list of laws CAI has had enacted against the homeowner. Stop these anti-homeowner laws. Represent your constituents - the people of Texas. Do not take any portion of TUPCA. Support the Homeowner Bill of Rights.

Thank you.

Below is a link to the October 2nd archived hearing. This link will take you directly to the taped video archived on the Texas Legislature website. The portion of the hearing regarding TUPCA begins at 58:00 minutes.

Texas Senate Hearing of the Intergovernmental Relations Committee on October 2, 1006