TUPCA is a lengthy bill full of traps for homeowners deliberately written to give the appearance of providing "protection"

November 05, 2006

By StopTexasHOARackets (View author info)

If you read Community Association Institute's (CAI) "Public Policies", they seek to establish a consensus that the Federal Fair Debt Collection Practices Act does not apply to Homeowner Associations.

Of course they paint HOAs as these semi-charitable helpless organizations.

Step 1: The management company moves in

The management company moves in and convinces the Board to assign all collection rights/proceeds, etc. to the management company and to permit "back-charges" against the homeowner for expenses "specific" to that homeowner. In addition, the Board is talked into adopting an "administrative policy" of applying payments first to fines, collection fees (management company), and attorney fees (management company affiliate) prior to applying them to the designated assessment.

Step 2: The management company looks for anything that might generate a fine in the interest of "aesthetics"

The management company looks for anything that might generate a fine in the interest of "aesthetics". Of course, Board members, lots owned by developer, etc. are off limits because the management company knows who butters the bread.

Step 3: Any payment is applied first to fines, collection fees, attorney fees

Any payment is applied first to fines, collection fees, attorney fees contrary to homeowner's written instructions. Why? Because this allows the management company to extort even disputed amounts from homeowners under threat of foreclosure. Guess who gets the equity in the house since the Board assigned their interest to the management company? If the FDCPA applies, this behavior is prohibited. Many states/circuits have determined that the FDCPA does apply in the context of HOAs. Texas apparently has not, but you will note that many of these HOA attorneys specialize in defense of FDCPA claims. CAI is against application of the FDCPA because it would stop the extortion cold in its tracks

Step 4: If you resist, you do so at risk of losing your home

if you resist, you do so at risk of losing your home.

By the way, if you read Texas Property Code §209.xxx, you would think it would protect you from foreclosure from fines, attorney fees, etc. related to breach of the covenants.

Indeed, the author, Senator John Carona, originally named this the Wenonah Blevins Property Owners Protection Act suggesting that this would somehow prevent against the abuses that were evident in that case.

To the contrary, John Carona is the largest owner of all of these management companies. Indeed he appears to be the owner of the largest property management organization in the United States. He writes these laws proclaiming it protects from such abuses.

Meanwhile, his management companies engage in re-characterization of monies. The result is that your payments are first applied to their fees (even if disputed). This means you are delinquent on your regular assessments. Thus §209.00X of the property code is a legislative fraud since your payments are re-characterized so that you are delinquent on assessments.

Senator Jeff Wentworth authored legislation to prohibit this tactic last year. John Carona personally tried to stop it in the Senate, but he was unsuccessful (is there any ethical standard in the Legislature, at all?). Carona then had a crony set the bill up to fail days before passing the House (it passed several readings) due to an undisclosed "point of order" (see SB 244 history at http://www.legis.state.tx.us/BillLookup/History.aspx?LegSess=79R&Bill=SB244)

Call your representatives about Carona and his management companies brazen effort to extort homeowners with TUPCA

John Carona is at it again with the Texas Uniform Planned Community Act (www.tupca.org). This legislation is absolutely horrible for homeowners. Carona is trying to create HOAs even where HOAs never previously existed.

TUPCA now authorizes this "priority of payment" scam §83.102(14). Carona is trying to ensure that all disputes have to be sent to arbitration rather than the court.

In addition to all the absurdities, you are expected to have to pay disputed charges in full before you can protest them (§83.163).

Generally every section of this lengthy proposed bill has a hidden trap for the homeowner. The text is deliberately written to give the appearance of providing "protection" until you understand how Carona and his organization behave.

If you live in any community that has any type of commonly owned property, you should contact your legislator and tell them you are adamantly opposed to TUPCA because it is a brazen attempt to

1) force the creation of HOAs, and

2) extort money from homeowners under a newly authorized threat of foreclosure for the benefit of John Carona and his management companies. The entire bill is an exercise in how to create a despotic government for the benefit of John Carona and other CAI members. Every state they have entered into has had to subsequently enact legislation to protect from what TUPCA is now trying to do. Texas has had to establish patchwork protection for Harris County where they are most active in the state. There are far too many problems with TUPCA to list here.

Attorney General with guts needed to pursue this Carona - CAI racket

Frankly, I would like to see an attorney general that had the guts to not only pursue this racket, but to look at where the money has flowed in the legislature, who has authored the legislation benefitting themselves, the representations made to constituents and lawmakers by CAI attorneys and lobbyists, and the great harm wreaked by Carona and his management companies to line his pockets.