Cinco Sign Opponents Claim LMA Board Members Have Conflict Of Interest
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Earlier this month, the LMA board voted 3-1 to approve the new signs. Prior to that vote, the Cinco Ranch Neighborhood Representatives Committee voted overwhelmingly to oppose the plan.
The vote by the LMA board was not, however, the final say on the project. It must still be approved by the board of directors of the Cinco Ranch Property Owners Association. That vote is expected in January.
A number of Cinco Ranch residents are now claiming the approval vote by the LMA was tainted because two board members, including the chair of the group and the member who made the motion to approve the measure, have a conflict of interest. Both, sign opponents claim, are employed by commercial developers that will benefit from the new signs.
Cinco resident Leslie Babin said the LMA board’s vote left her with the feeling the sign proposal “is a done deal.”
“It’s really looking like this thing is a done deal under the table; the fix is in,” Babin said.
She pointed out that LMA board members are employees of the Newland Corporation, the developer of Cinco Ranch, and Vista, the management company for LaCenterra. Both developers, Babin said, have a lot to gain because the new signs will be a natural draw for LaCenterra and other nearby commercial developments.
Richard Albrecht, the chair of the LMA board, is an employee of Newland Communities. Dana Garnett, the board member who made the motion to approve the signs, is a senior vice president for Vista and works out of the company’s LaCenterra office, Babin said.
“I find it very suspicious that opposition (to the signs) was overwhelming until it came to the LMA board. Then, amazingly, it was approved,” Babin said. “Despite an overwhelming poll that told them residents opposed the idea and an overwhelming vote of the (Neighborhood Representatives Committee) urging they reject the project, the LMA gave it their stamp of approval. Clearly, some of the LMA board members were looking out for somebody else’s interests other than Cinco residents.”
One Cinco Ranch insider, who asked that his name not be used because of possible retaliation, said some Cinco employees are nervous about the direction the sign proposal is taking.
“You’ve got some folks at the Cinco office that are privately worried this whole thing will give Cinco Ranch a black eye. Nobody ever thought it would come to this,” the individual said. “Everyone thought this deal would sail through without a blink of an eye. Now it’s at a point where it’s getting out of their control.”
The individual said Newland and LaCenterra interests have long controlled what happens in Cinco Ranch. He added that it is well-known by insiders that the board of MUD 12 met with Vista and Newland early on in this process to develop the sign project.
“Don’t let them fool you. Newland and Vista were there at the beginning of this deal. Their fingerprints are all over this thing; the MUD board is just doing what their bidding,” the insider said.
A review of the minutes of Cinco MUD 12 for 2007 and 2008 showed that Vista and Newland representatives were, in fact, present at a number of the MUD board meetings during which the sign project was first being developed. The minutes also reflect the fact that the developers’ input was solicited by the MUD board.
Although Albrecht was not listed as personally attending any of the meetings, Lisa Chahin of Newland Properties was listed as being present and taking part in a number of the meetings. Garnett was listed in the minutes as personally attending several MUD board meetings during which the project was discussed.
Neither Albrecht nor Garnett responded to repeated requests for comment.
Cinco MUD 12 has proposed spending approximately $1.4 million in sales tax revenues to replace eight existing entrance signs along The Grand Parkway. That proposal has come under fire from many in Cinco Ranch as a waste of money benefiting only commercial areas such as the LaCenterra shopping center and a large Super Target store.
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Since they have your attention why not encourage them to put it on the ballot for all members to vote on (without proxies).
Senator Jon Lindsey, Chair
Texas Senate Intergovernmental Relations Committee
Texas Senate Logo
P. O. Box 12068 - Capitol Station
Austin, Texas 98711
From:
Elizabeth McMahon
San Juan Capistrano, California 92693
Re: Letter to Texas Legislature Regarding HOA Insurance & HOA Lawsuit Industry - CAI
Note to Rob Edwards - Committee Consultant:
In our phone conversation on April 3, you assured me that previous insurance information that we had sent had been included in the legislative spreadsheet of comments – apparently, it had been inadvertently left out. You also asked me to send you a cover letter on the insurance issue. As this is a wide ranging and complex issue, I will highlight some of the salient points here.
Dear Texas Legislators,
1. Many legislatures, due to intense lobbying both by insurance companies (particularly Chubb insurance) and CAI, have passed laws mandating that homeowner associations purchase various forms of insurance, including liability and D&O insurance.
Of course, the homeowners are the ones who pay for this mandatory insurance. What deeply galls homeowners is that this insurance is too often used as a sword against them. See the attached article - "Homeowner Association Insurance, A Sword, Not Shield".
2. CAI lawyers have milked these insurance policies to the fullest.
They manipulate situations between homeowners and their boards so that many homeowners are forced to file lawsuits against the association to protect their rights. CAI lawyers just love this because it triggers the association’s D&O policy. Using this considerable financial muscle, they attempt to strong arm the homeowners with depositions, motions, vast discovery requests – all designed to make the lawsuit cripplingly expensive for the homeowner. Combining this might with trickery, they often drive the homeowner to financial ruin, and resulting foreclosure.
3. Homeowners need protection from this CAI racket.
As the legislature requires them to purchase this insurance, the legislature should require some fundamental protections as well. One protection would be to require insurance companies to have a fiduciary obligation to the homeowner. This would help stamp out the common practice of insurance companies defending boards when the latter are clearly in the wrong.
4. The deeper reform, however, is to eliminate CAI from the entire homeowner association scene, for, without them, there would be far fewer problems in homeowner associations.
The following examples of the damage that CAI does is not intended to be exhaustive.
a). CAI has such a stranglehold on homeowner associations that insurance companies are forced to market their policies through CAI.
Chubb insurance, for example, includes an application form for membership in CAI along with its own insurance application form. An insurance company knows that it has little or no chance of securing the business unless it has the active backing and approval of CAI.
Furthermore, companies such as Chubb Insurance are forced to provide bribes to managers and board members in order to secure the business. Chubb is forced to piggyback coverage for the association’s management company onto the back of the association.
Chubb is forced to offer $100,000 in Accidental Death &Dismemberment coverage for each board and committee member for only $100 a year.
Both of these practices should be outlawed. Not only is bribery against sound public policy, but it raises the insurance premiums for homeowner association policies – and it is the homeowner who has to pay for this increase.
b). In Texas, Chubb has been forced to drop out of the homeowner association insurance market because it was losing too much money in the lawsuits brought by homeowners against Chubb and CAI.
CNA, the country's 5th largest insurance company, is negotiating with CAI to market its D&O policies through them.
c). In many areas of the country, especially in California, CAI lawyers have sued builders to such an extent, that many builders can no longer afford to buy insurance.
In South Orange County, California , an estimated 80% of all homeowner associations have been involved in some form of construction defect lawsuit.
One CAI lawyer openly brags that he has won over $450 million from builders in the last 15 years. Assuming that this lawyer collected 40% of this for his own fees, one can understand how he was able to donate $1million to former president, Bill Clinton.
The building industry in Texas should be no friend of CAI. If builders cannot build, homeowners cannot get homes. If defective homes are built, there should be a recovery mechanism to fix the problems without creating a multi-billion dollar lawsuit industry, that often siphons so much money, that the homeowner is not left with enough to repair his home.
d). For decades, CAI has been lying on a national level to the public, legislatures, the courts and media, that they a friend of the homeowner.
They have camouflaged proposed legislation as being pro-homeowner, whereas in reality it has legislated away homeowner's property rights, and turned the equity in their homes and their savings into lawyers' fees. For example, in California, they bribed legislators into passing a law that allowed homeowner association reserves to be used for attorney fees. CAI should be unmasked for what it really is, a selfish, grasping group of greedy lawyers.
e). For approximately the last 15 years, CAI lawyers have been training managers to be lawsuit chasers and lobbyists (AB555-California).
They train managers to be confrontational with homeowners in an effort to drive the homeowner to file a lawsuit. In California, CAI lawyers in effect created CACM (California Association of Community Managers) to lobby on behalf of CAI policies before the California legislature.
f). In the last few years, CAI has mounted an insidious campaign in such disparate states as Florida, California and Texas to be become the "official trainers" of board members in homeowner associations.
They have realized that one of the best ways to ensure that associations continue to be a cash cow for them, is to brainwash board members. Homeowners believe that this is analogous to allowing the tobacco industry to teach children about the health effects of smoking, or even worse, allowing terrorists to train airport security personnel. Homeowners believe that it is simply crazy to allow the very ones who stir up problems in homeowner associations, to be the "official trainers".
The accompanying material documents how CAI even advocates incarceration in mental institutions for homeowners who question their views and validity. (see attached article - "Land of Terror ")
g). CAI attempts to infiltrate members into government offices.
In California, they have tried to do this in the Insurance Commission, the Attorney General’s office, the Department of Real Estate, the courts, and law training publications.
They have sponsored laws that contain loopholes by which they can get unlimited lawyers’ fees for minor dues infractions. They have used fines to mine the bank accounts of homeowners, and ultimately to bankrupt them.
The overarching fact is that CAI has been a scourge on the land – and even its original founder admitted this. It has turned into a rack that seeks to grind out every last penny it can from homeowners.
Legislatures should be shutting such operations down. A home is the most important place for any citizen. Anything which threatens that should be relentlessly outlawed. Without a CAI, homeowner associations would be much better places to live, and legislatures would have much less work to do.
Sincerely,
Elizabeth J. McMahon
Director
American Homeowners Resource Center
http://www.ahrc.se/new/index.php/src/govt/sub/letters/action/display/id/19
HOAs are “privatized governments” with none of the safeguards of “separation of church and state,” transparency, free speech, and basic “checks and balances.” Because of the lack of these vital government measures, HOAs have evolved into some rather abusive, bloated, and feudalistic systems; Systems that serve the secretive HOA structure, but not the members of the community.
The manner in which we give up our rights does not vary much from HOA to HOA, because nearly all of them are either members of an organization called CAI or they conform to the CAI’s guidelines. More can be gleaned about the CAI from knowing its tangled political and economic relationship with the very wealthy Texas State Senator John Carona. http://www.usatomorrow.us/index.php/news_articles/view/hoa_legislation_the_secret_assault/
A “master plan” requires passive and misinformed residents overall, however, it also requires neighbors to finger point among themselves, so that the HOA can step in and show that peace/conformity can be kept with “violation notices, fines, fees, and foreclosures. In this way, Stalin’s fascism depended on and encouraged neighbors to inform on each other. Similarly, HOAs usually have one or two aberrant members who hate dogs, children, or minorities, and are happy to make formal and secret complaints about their neighbors' “violations.” Such power is enticing to certain few people. It only takes one such neighbor for selectively chosen violators to justify their own violation by pointing out five other neighbors who have the same violation, instead of working with healthy neighbors to demand deep changes within the HOA. The seduction of conformity is tough to see through.
http://www.lostmountaintownship.net/HOA Saga.html
http://www.ahrc.se/new/index.php/src/news/sub/article/action/ShowMedia/id/11
Chubb Insurance has a nationwide monopoly on the insurance sold to homeowner association boards, and that it has secured this monopoly by promising to defend boards – no matter what they do.
Here's another interesting site mentioned in the news investigation.
http://pages.prodigy.net/hoadata/
That was a pretty informative investigative report. Why are legislative officials voting and writing bills that put more money in their personal pockets? Why doesn't the Texas Ethics Commission, or the legislature require recusal in such conflicting instances?
Check this recent story out and google HOA abuses. You will find quite a gold mine.
http://www.lasvegasnow.com/global/story.asp?s=9390698
http://www.youtube.com/watch?v=d1jz4OuJZcQ (Here in TX, 2 part series)
http://onthecommons.us/ (national radio show)
One way Cinco Ranch resident could deal with the potential conflicts of interest is report them to the IRS and file a complaint against their Corporate Charter with the Secretary of States Office. If vendors are serving on any of these boards registered as non-profits you may have a good case. Look into it.
Is Conco Ranch still in America?
Did it get Axex by another country that Denieds "LEGAL" votes like they do in Cuba, and such said countries?!?! WOW!?
GOD BLESS and HAPPY TRAILS!!!!
Is Cinco Ranch still in America?