CHARLESTON – A House bill that critics say would take away some major consumer protection rights for homeowners is dead.
House Bill 3558 was introduced February 23. It would have provided an exception to the provisions of Uniform Common Interest Ownership Act for planned communities. In short, the bill would allow homeowners associations to opt in or out of UCIOA, which is codified as Chapter 36B in state code, with a simple vote.
But, following coverage of the legislation by The West Virginia Record and calls to delegates by concerned parties, the bill is being shelved for the session.
Kirby
| Courtesy photo
Delegate Todd A. Kirby (R-Raleigh) was one of the original co-sponsors of the bill. But once he learned more about the bill from concerned parties, constituents and his own research, he said he wanted him name removed from the legislation.
Then, he says the bill “lost all of its support” and is “dead on the House calendar.”
“It originated in the Economic Development and Tourism Committee, of which I’m a member,” Kirby told The Record. “We were told developers from out of state wanted to build or expand subdivisions in the state and wanted the option to opt in or out. It was sold as free market flexibility for homeowners and that all sides wanted it.
“That made it a no-brainer. I even thought about communities in my home county like Glade Springs.”
But after the bill was introduced, Kirby said he started receiving emails and phone calls from interested parties such as homeowners’ associations, law firms that represent HOAs and developers.
“This bill is just not good,” Kirby said. “It strips away all of these consumer protections. So after I researched it and spoke to residents of Glade Springs, I realized I had made a grave mistake.”
Kirby said everyone involved with writing and sponsoring the legislation is opposed to it running now.
“The intention may have been good, but we’ve got to amend it for later. So we’ll just deal with it before next session. We’re not going to hastily amend it and put lipstick on a pig.
“Personally, I’m not willing to do anything to the existing consumer protection laws in place for HOAs until all interested parties are at the table.”
An attorney whose firm represents 75 homeowners’ associations across the state was quick to criticize the bill last week. He said none of his clients were asking for the legislation.
“House Bill 3558 is a horrible law for developers, purchasers and owners of homes in West Virginia,” Mark Sadd of Lewis Gianola in Charleston told The Record last week. “It removes protections for both the developer and homeowners who pay money to homeowners associations to maintain roads, amenities, swimming pools and similarly common-owned facilities.
“Whole purpose of this act is to protect buyers and homeowners from developers who want take advantage of people who are buying the most important asset in their lives.
“(The bill) removes all of the protections and causes of action against abusive developers. Lenders would go nuts. There’s not stability. It would affect how homes are taxed, and some homeowners conceivably could be double taxed for roads.”
The president of the West Virginia Organization of Homeowners Associations agreed.
“Transparency is being thrown away at the expense of the homeowners,” Nance Brisco told The Record last week. “They’re taking advantage of homeowners who don’t know any better. The developers know better. I’m just livid."
Delegate Jordan Maynor (R-Raleigh) authored the bill, but he wasn’t one of the sponsors. Delegate Gary Howell (R-Mineral) is the primary sponsor. Delegates Wayne Clark (R-Jefferson), Mike Hornby (R-Berkeley), Anita Hall (R-McDowell), Todd A. Kirby (R-Raleigh), Bob Fehrenbacher (R-Wood) and Mickey Petitto (R-Harrison) were co-sponsors.
Kirby and Hornby had their names removed from the bill. Maynor did not return calls and messages from The Record seeking comment for the story.
Sadd represents the Glade Springs Village Property Owners Association in a lawsuit against Justice Holdings, which is owned by Gov. Jim Justice. In 2021, Raleigh Circuit Judge Robert A. Burnside issued an order granting a $6.6 million summary judgment in favor of the property owners.
The case began in late 2019 when Justice Holdings filed a civil complaint against the association seeking amounts due under a loan agreement. Justice Holdings claimed original developer Cooper Land Development Inc. agreed to loan the association $15 million to fund the construction and installation of water, sewer and electric utilities in the development. Justice Holdings is the successor developer to Cooper Land.
In April 2020, the property owners association filed a counterclaim seeking judgment against Justice Holdings for unpaid assessments on lots the company repurchased.
“Since July 31, 2014, Justice Holdings had been ‘offsetting’ its statutory and contractual assessment obligations to GSVPOA … with regard to the Justice Lots against the claimed indebtedness under the loan agreement,” Burnside’s order states. “GSVPOA thus also seeks summary judgment against Justice Holdings for the unpaid, offset assessments, including interest at the rate of 10 percent per annum.
“In addition, GSVPOA seeks judgment against Justice Holdings for reimbursement of $545,000.00 representing payments from GSVPOA accounts tendered to Justice Holdings by the Justice-appointed board under the loan agreement.”
In October 2020, Burnside ruled the Uniform Common Interest Ownership Act applied to Glade Springs Village from its inception, and he ruled the provision that would have exempted the developer from assessment liability was invalid.
Thus, that order granted GSVPOA summary declaratory judgment and said the association was entitled to monetary judgments for unpaid assessments against Justice Holdings and that those judgments should include an amount equal to the unpaid annual assessments on the lots within Glade Springs Village.
Justice Holdings has appealed the ruling to the state Supreme Court. It has been accepted for oral arguments, but no date has been set.
Sadd declined to comment on the pending case, but he did say the bill, if applied retroactively, could render such a case as moot.
“Only foolish and dishonest developers are the ones who would have a problem with the current law,” Sadd said. “This bill would eliminate all protection of homeowners and home purchasers who buy into a homeowners’ association. The UCOIA is an important consumer protection law that has been adopted in many states in the country.
“West Virginia would be the first state to gut it, and it would remove many protections for both the developer and the homeowners against abuse by each other. The fact that it could be retroactive is shocking.”
Maynor was appointed to the House of Delegates in 2021 by Justice. Elmer Coppoolse – general manager of The Resort at Glade Springs, Chief Operating Officer of The Greenbrier Resort which also is owned by Justice and majority owner and CEO of Emco Glade Springs Hospitality – hosted a fundraiser for Maynor’s 2022 re-election campaign on March 25, 2022, at Glade Springs Resort, according to campaign finance records. Coppoolse also donated $1,000 to Maynor’s campaign at that event, according to records.
