Eric and Judy Vastine thought they had a little piece of heaven: a cozy, straw-bale house they built out in the desert a few miles south of Interstate 10 in 1999.
Solar power, trucked-in water, a wood stove needed only on the coldest nights, a cell phone. No utilities. No neighbors. No mortgage. No worries.
Then last summer they learned they lived in the middle of a new housing development, Santa Rita Acres Estates, and owed $15,000 to $20,000 to a homeowners association they didn’t know existed.
“We knew this was going to be developed,” said Eric Vastine, a former credit union employee who quit to build the house where he now home-schools the couple’s boys, Joe, 11, and Sam, 14.
After all, their acre was just one of 101 in a parcel subdivided in the early 1960s. Technically, they always had neighbors. It’s just that none of them lived there. Eric Vastine said some bought lots for later retirement, others as an investment, and some for their children.
The original covenants, conditions and restrictions — known as CC&Rs — amounted to only a page and a half and spelled out what could not be done with the property. They were not very restrictive.
Eric Vastine said the 1,600-square-foot straw-bale house — which he built by working seven days a week for 17 months, with help from the family and friends on nights and weekends — was in compliance.
Still, although it was easy to build there, it wasn’t for everyone. Water probably was the main obstacle, because there wasn’t any. The Vastines have water hauled in to their 1,600-gallon tank.
So the Vastines expected that when someone did build, he or she probably would be like-minded: an independent, live-and-let-live type like them, rather than someone who would move into a more traditional development.
The Vastines were shocked to get a letter last summer telling them that a neighborhood association had been formed and was inviting them to a meeting. There they met about two dozen other lot owners.
One was Moshe Gedalia, a Tarzana, Calif.-based developer who they learned owned 67 lots, a majority, and had formed the homeowners association, with a board of directors and an architectural review committee.
He was the developer of Santa Rita Acre Estates and, through his majority landowner status, had staffed the homeowners association with his representatives.
They learned they lived in Santa Rita Acres Estates, where homes start in the low $200,000s and go much higher — attractive, modern-looking three- to five-bedroom homes, some with stone floors and heavy carved oak doors, pools, spas and three-car garages.
The new CC&Rs, the Vastines learned, grew from the original subdivision’s terse page and a half to a complex 19. Construction or modification would have to go through the association’s architectural review committee; the developer could operate machinery day or night; the association could put liens on property to assure payment of assessments; there could be $250 fines for violations of rules; and members of the board of directors need not even be property owners.
And, Eric Vastine said, they were told the association had made some preliminary estimates of how much each lot owner owed the association for roads, water, sewer, electricity, telephone, cable and other shared community upgrades.
“They [Gedalia and his general manager for the project] were throwing numbers around at first, like $20,000,” Eric Vastine said.
Eric Vastine said he, Judy and some others asked, “How can you do this?” To which Ron Amiran, the project director, said: “We had a vote. Moshe with 67 lots and votes. It passes.”
Amiran said Eric Vastine’s version of the meeting is essentially correct. Amiran said the procedure is completely legal, though maybe not the way he’d do it if he had to do it all over again. He said it “would have been more polite” to tell the other landowners that the developer was forming a neighborhood association.
Still, he said, Gedalia has no evil intent but wants to protect his investment in the development against “trashy-looking houses, or putting up trailers.”
Amiran said the developer has spent $850,000 on putting in roads and utilities, all of which he said are required by law. He now estimates the per-lot share to be about $17,500, but he said that since the Vastines had lived there without utilities and don’t intend to use the utilities, “we can sit and talk. But they have to pay for the road.”
Gedalia was out of the country and unavailable for comment.
Eric Vastine said he is concerned about whether he can add a garage.
But most of all, he is concerned that if he cannot get out of the assessment, the couple will have to mortgage their home.
Though he said they don’t want to move, they made an offer to Gedalia asking $210,000 for their home and lot. Amiran wrote back saying Gedalia was not interested. But in an interview earlier this month, Amiran said the developer was still open to the idea of buying.
“I tell you what we had in mind,” Amiran said. “Somebody came up with the idea: `Why don’t we buy them out? The roof shines. A tin roof. It looks like a shed. Buy them out and put on another roof.’ “
The Vastines said they apparently have no other recourse unless they want to pay the assessment and live under the association’s CC&Rs.
Jerome Jordan, a spokesman for the Arizona Department of Real Estate, said there is very little regulation of homeowners associations. He said they register with the Arizona Corporation Commission as legal entities and then come under the Department of Real Estate only to assure compliance with a couple of very basic legal requirements. “All we can see is if the developer is in compliance with the Arizona Revised Statutes for public reports or intentions to take lot reservations,” Jordan said.
He said the public report is the legal description of the property, essentially its location, and “disclosures about unusual safety factors, et cetera, basic things about the property.”
“We get calls about homeowners associations all the time,” Jordan said. “The Legislature hasn’t put homeowners associations under our purview.”
