Changes sought in homeowners association rules

Lisa Snedeker

Monday, March 29, 1999 | 11:01 a.m.

Lynette Lynch is looking for a way to stop what she refers to as her runaway homeowners association board.

And if the more than 50 residents who showed up Saturday morning during a special subcommittee meeting of the state Senate's Commerce and Labor Committee at the Sahara West Library are any indication, she is not alone.

Sens. Mike Schneider and Maggie Carlton, both D-Las Vegas, heard more than two hours of testimony from homeowners and property managers on Senate bills 441 and 451, both of which would make various changes to provisions in the state law that governs common-interest communities or homeowners associations.

Lynch, who bought her retirement home in the Fairways Villas development in Las Vegas, told the senators her homeowners association board holds secret meetings.

"They have a little dictatorship instead of representing homeowners," she said.

Lynch said she has been asking for copies of the association's cash-flow reports for several months, only to be ignored.

Making associations' financial statements more readily available to homeowners is one change Schneider has said he would like to see in the current law.

Schneider also suggested the state needs a standard set of covenants, codes and restrictions (CC&Rs) for associations.

"Each association is different, but there should be a list of things that are in each set of CC&Rs," he said.

A number of homeowners asked that the language in the current law be revised so that it is more clear.

The biggest point of contention over SB441 seemed to be that it would eliminate the state office of the ombudsman for owners in common-interest communities.

A number of residents spoke out in support of ombudsman Mary Lynn Ashworth, whose position was created in response to persistent complaints about homeowners associations statewide.

The state Real Estate Division, under which the ombudsman operates, is asking lawmakers to establish an enforcement committee through the real estate office to mediate association clashes.

The ombudsman's post has no authority to resolve disagreements between homeowners and their associations.

Schneider assured those in attendance that Committee Chairman Randolph Townsend, R-Las Vegas, has said, however, he will not process any bill unless the ombudsman's office is included in it.

SB441, if passed as written, also would:

* Authorize an executive board to impose certain fines.

* Require a developer to deliver to the association a reserve fund for repairs and replacement of common elements such as a neighborhood swimming pool.

* Require an association to conduct periodic studies of its reserve fund.

* Revise how notice is given for meetings.

* Revise circumstances under which an association may foreclose on a lien.

In SB451, however, the ombudsman would be required to maintain a data base that would contain the governing documents of each association in the state and create a commission for the resolution of disputes related to associations. It also would abolish the current requirement that such disputes be submitted for mediation or arbitration.

If passed, SB451 also would require an association to prepare and distribute operating and reserve budgets; require association boards to conduct reserve studies; and revise the manner in which fines may be imposed for a violation of the governing documents of an association.