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POAs: Legislation to improve disclosure picks up support

By Charles Swenson
Coastal Observer

After years spent fending off legislation that property owners groups called “punitive,” the associations are ready to back a bill in the coming legislative session that would require disclosure of fees and assessments to buyers.

“The thing association managers hear all the time is, ‘I didn’t know,’” said Press Courtney, president of Waccamaw Management. He also chairs the legislative committee for the S.C. Community Association Institute.

He told board members of the 29 community associations within the Litchfield by the Sea Property Owners Association last month that the institute will back a bill by Sen. Darrell Jackson called the S.C. Homeowners’ Association Cooperation Act. It didn’t get out of committee in the last session.

The bill would amend the state’s real estate disclosure law to include fees and assessments. It would also require associations to hold at least one public meeting for members and give at least 10 days’ notice. Associations would have to “provide a fair, reasonable and expeditious procedure for resolving a dispute” with owners, “which we think is a good thing,” Courtney said.

Jackson, a Richland County Democrat, has also introduced legislation that would require associations to register with the state Department of Consumer Affairs. The department would collect a $10 annual fee for each property within an association to cover the cost and to handle disputes between associations and owners. That was vigorously opposed by the associations and the institute.

“It was punitive to well-run associations,” Courtney said. “I’ve been to every Senate hearing that’s been held [on the bill]. It’s not going anywhere.”

Tom Sticker, president of the Hagley Estates Property Owners Association, attended a hearing conducted by the Horry County delegation in Conway this fall on homeowners associations. He said many of the complaints were about lack of transparency. That’s not an issue he hears locally, said Stickler, who is also president of the Waccamaw Neck Council of Property Owners Associations.

Stickler said a simple solution to the problems would be to create an online repository for master deeds and restrictive covenants, something he proposed at the hearing.

Property owners in Hagley don’t have to be members of the association, but they are impacted by the community’s deed restrictions. Under current state law, those have to be disclosed to a purchaser. But Stickler said he still finds new owners “who had no idea deed restrictions applied to their property.”

Those cover such things as building setbacks, which are more restrictive than those contained in county zoning, and a ban on shooting firearms.

One reason disclosure is important, he said, is that other property owners can go to court to enforce those restrictions. “We’re here to help you avoid making mistakes,” Stickler said. “People should know what they’re getting into.”

Courtney agreed disclosure is a major concern. He met last month with the S.C. Association of Realtors to enlist support for the Homeowners’ Association Cooperation Act. “It’s got to go before their legislative committee,” he said.

He also noted that the current disclosure law exempts the sale of new homes. “We brought that up with the Realtors,” Courtney said.

Like Stickler, Courtney said he hasn’t heard of major problems with homeowners associations on Waccamaw Neck. But he said legislators in Horry County will be pressing for action on homeowners issues and he thinks it’s time, provided the law isn’t onerous. “There are plenty of HOA problems out there,” Courtney said.

Another piece of legislation the Community Association Institute will push in the coming session will require licensing for property managers.

“We want to be regulated more than we are to elevate the profession,” Courtney said.

But he acknowledged it could be a tough sell because the legislature is in an anti-regulatory mood. Still, “you have to have a license to cut sombody’s hair,” Courtney said, so there may be hope.

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