To the South Carolina legislature: 
Give us a law to protect homeowners! 

"The fox is guarding the hen house..."
ChangeTheBoard.Org
Indian Land, South Carolina
Without laws, money buys governance
South Carolina boasts an estimated 6,500 homeowner associations, each governing a common-interest community. These governing associations are commonly called HOAs, but may be called a community, condominium, or property owners association.
 
Local jurisdictions are partial to HOAs, because developers pay for the community’s infrastructure and amenities, passing the costs onto homeowners when they purchase their homes.
 
As the population of this Sunbelt state rapidly grows, buyers find it more and more difficult to find a home in a community that is not governed by an HOA. Yet, to its shame, this state has enacted no laws to protect residents who live in common-interest-ownership communities. There are no laws to protect homeowners from mismanagement by a developer-controlled HOA!
 
For a dozen long years, the state legislature has received, then promptly killed, bills that would protect homeowners from corrupt and mismanaged HOAs. Hoping to remedy the lack of protection, Change The Board soon will be beginning its fourth year of trying to get a state law that changes how developers manage HOAs.
 
HOA problems begin when a developer writes the documents that govern an HOA. Unfortunately, the state has established no guidelines for protecting its hundreds of
thousands of citizens living with HOA governance.
 
With no oversight, no accountability, no checks and balances, developers can—and all too often do—write the governing documents to award themselves and their companies innumerable personal and financial advantages.

After all, no one provides oversight for HOAs. Anything goes!
TAXATION WITHOUT REPRESENTATION!

“The developer says he will never give up control...We are literally paying nearly $3,000 a year per homeowner in HOA fees with no clarity as to where they are spending our money… He [the developer] ignores every email and voice message without any response.”
Although homeowners in South Carolina pay their fees to operate their HOA, developers rule as they choose, appointing their busy building staff or associates to the Board of Directors. While paying the bills, homeowners are shut out of their own governing process. Many call this "taxation without representation."
 
As many homeowners will attest, a developer can dictate limitless ways to shroud HOA governance and harm homeowners. After all, no one is watching the developer!
 
A few examples…

  1. Secret meetings of the Board of Directors mean no homeowners are allowed to attend, no minutes of meetings are provided, and homeowners cannot hold developer-controlled Boards accountable for questionable actions.
  2. No problem-resolution mechanism is provided for dealing with community issues that arise from suspected mismanagement of the HOA funds paid by homeowners.
  3. Developer-subsidized HOAs often suppress HOA dues to entice new buyers. When developers complete their work in a community, the HOA must then assess homeowners huge balloon fees to finance the maintenance of their community. Those who cannot pay typically face a lien and foreclosure on their home.
  4. Withheld HOA financial records, including line-item details, can indicate incompetence, embezzlement, negligence, kickbacks, and other unethical actions. Remember, nobody is watching the developers.
 
As South Carolina homeowners know, developers find countless ways to waste HOA funds, as well as con homeowners—all to the glory of the “bottom line.”

Quick and easy solution
This past year, a single bill, 3886, passed the Senate Judiciary Committee but never made it any farther. The bill would have provided an ombudsman to collect and report 
complaints, provisions for homeowners to take small claims to magistrate courts, and optional training in HOA matters. 

Like so many other HOA bills, 3886 may have fallen victim of of the cash-rich builder-real estate PACs. 

Click here to read Bill 3886.

Bill 106, the bill supported by Change The Board, never made it past the Senate Judiciary Subcommittee. It would have given homeowners insight into, and oversight of, their HOAs. The bill would have phased elected homeowners onto the HOA Board of Directors in lagging proportion to the percentage of home sales in a developing community.

Click here to read Bill 106. 
 
More on why we need an HOA law
Homeowners all over the state--indeed, across the nation--have become victims of closed HOA governance and the resulting mismanagement and abuse. Below are a few—just
South Carolina is one of a minority of states that offer virtually no protection to homeowners governed by developer-controlled
Homeowner Associations (HOAs).

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a very few—examples of abuse throughout the state. These events might not have occurred if homeowners had access to their Boards of Directors and their governance. ​
  • Foreclosures in numerous communities on homes lacking only a few hundred dollars of unpaid HOA dues.
  • A lack of problem-resolution mechanisms other than cost-prohibitive lawsuits.
  • Widespread ignorance of HOA obligations and operations, which highlights the need for training home buyers, developers, and Board members on their HOA responsibilities.
  • Secret HOA subsidies to entice buyers, which cause HOA fees and assessments to surge after a developer leaves the community.
  • Underfunded reserves, leaving homeowners unable to pay the hiked payments and costing them loss of their homes.
  • HOA overcharges of $168,000 to senior citizens who had no one to field their complaints before they (those still living) could eventually obtain a refund.
  • Contracts not put to public bid, costing homeowners, in one specific example, $142,000 per year, because no one appears to have read the fine print.
  • Developers completing construction and remaining in control of an HOA for years, even decades—one developer controlling his community’s HOA for a 40-plus years…and with no homeowner-Board members.
  • Lack of an inventory of common-interest assets, leaving some properties without insurance and insuring others needlessly.  
  • ​An HOA’s refusal to repair badly leaking roofs shared (in a horizontal regime) by villa owners.
  • No inventory of community assets—some assets (retaining walls) insured, but others not covered by policies, all of which lacked the specific coverage needed.
​​​Change The Board receives many emails similar to this one:
“The developer says he will never give up control...We are literally paying nearly $3,000 a year per homeowner in HOA fees with no clarity as to where they are spending our money… He [the developer] ignores every email and voice message without any response.”
 
How can the State of South Carolina sanction a closed, secret governance?
Legislators, time to protect homeowners!