A community association is a private, not-for-profit corporation, founded by the developer with the approval of local government, to which all the homeowners in a development automatically belong. The association, which is run by a board elected by the individual owners, collects monthly dues from each member. The purpose of these dues is to pay for the upkeep and repair of common property, such as swimming pools, clubhouses, tennis courts, golf courses, parks, and playgrounds. Some associations also own streets, sidewalks, and parking lots.
Although all municipalities have zoning today, deed restrictions have not disappeared. These restrictions go much further than most municipal ordinances. For example, New Daleville homeowners will not be allowed to erect satellite dishes on their front lawns, or park recreational vehicles, trailers, or boats where they are visible from the street, or store trash, lumber, old cars, or scrap in their backyards. Nor will they be allowed to build aboveground swimming pools or any sorts of accessory buildings, such as toolsheds or playhouses. They will need association approval to plant shrubbery more than three feet high and to put up flags, banners, or signs. And despite New Daleville being in the country, they won’t be able to keep livestock.2 Such rules are not unusual. “I actually haven’t read the New Daleville agreement,” Duckworth admits. “Most of it is pretty standard. It’s what we and our lawyers, who draft these things for a living, have found works. There are some buyers who don’t want any restrictions, but most people accept reasonable limits on what they consider objectionable behavior. They don’t necessarily read the fine print when they buy the house, but believe me, they do when their neighbor does something obnoxious.”
“Once we finish the project, people can decide to change the restrictions,” he says, “but they never do. I don’t know of any case where they’ve changed anything fundamental.” That is hardly surprising. At New Daleville, it will require the support of at least two-thirds of the owners to pass an amendment and a unanimous vote to terminate the agreement. The agreement will run for thirty years, which is typical, at which point it will automatically be extended for ten more years, unless terminated by a vote of not less than 80 percent of the owners. In other words, the New Daleville association will be around for a long time.
In the popular imagination, community associations are often linked to gated communities. This perception has lead to a series of critical books with alarmist titles such as Privatopia, Behind the Gates, and Fortress America. But not all communities governed by an association are gated. According to the U.S. Census Bureau, although some 10 million American households belonged to community associations in 2001, fewer than 4 million lived in gated communities.3 This represents about 4 percent of the total population, a small fortress indeed. Like most developers, Duckworth is pragmatic about gated communities. “I’ve built only one gated community in the Philadelphia area,” he says. “It was an upscale community with a hundred and twenty homes, which would each probably sell for about half a million dollars today. We paid for the gates, built a guardhouse, hired guards. I live nearby, and I noticed that shortly after we handed over the project, the association fired the guards and left the gates permanently open.” He believes that, at least in the Northeast, gates are more about projecting an image of exclusivity than about maintaining security. By contrast, he says that if you are building a planned community in South Florida, or in many places in California, buyers absolutely demand walls and gates. “I think gates are a bit like doormen in urban apartment buildings. Are they there for the image, the convenience, or for security?”
There will not be any gates at New Daleville. Access to the neighborhood will be public, since all the streets, although built by the developers, will be deeded to the township when the project is finished. “We insist on that,” says Duckworth. “After all, the owners pay property taxes, and they shouldn’t be burdened with policing, snow plowing, and repaving the streets.” The association will be responsible for maintaining the rear lanes, the green courts, the walking trails, the play lot, and the storm water retention basins, and for the landscaping in the common areas.
Community associations are governed by the homeowner agreement. The sixty-five-page New Daleville agreement is the responsibility of Simi Baer Kaplin, whom I meet for lunch in a suburban mall. She graduated from the University of Pennsylvania Law School four years ago and works at Kaplin Stewart, her father’s law firm. I ask her how she decides what to include in an agreement. In Pennsylvania, community associations follow state regulations, she says, so much of the text is standard: how the developer establishes the association, how the association is run, the rights of the various parties, the procedures for compliance and default, and so on. However, what she calls the “lifestyle restrictions” vary from project to project. They depend on the experience of the developer, what other developers in the area are doing, and the kinds of home buyers the development is aimed at. According to Kaplin, the restrictions are a combination of what buyers expect, what makes them comfortable, and what doesn’t discourage them from buying.
“I asked Dave Della Porta how strict he wanted the rules for New Daleville to be,” she tells me. “He didn’t seem much concerned and left it up to me. It’s housing for families, so that influences the restrictions. In general, I try to be reasonable. For example, I think that restrictions on clotheslines not being visible from the street are okay here, but I wouldn’t write that kind of rule for a modestly priced town-house development where not all the units have dryers.” The restrictions also reflect her own biases. “I tend not to write complicated rules about hiding trash cans,” she says. She agrees with Duckworth that most buyers probably don’t read the agreement at the time of sale. “After all, it’s more than sixty pages. I belong to a homeowner association, and I’ve read all the rules because I’m a lawyer. But my husband, who’s a podiatrist, doesn’t care.”
Kaplin points out that community associations can be activist. “It’s not uncommon for associations to sue developers who they believe have cut corners in completing a project.” Associations can also be strict with their own membership. The board of directors has the right to levy fees on the owners, and to assess fines and late charges, although unlike co-op boards, they do not control who becomes a member. Because associations have such wide discretionary powers, they are sometimes darkly referred to as “private governments.”4 They do not seem so different from social clubs, religious denominations, and other groups that also have special rules about private behavior. But there is no doubt that community associations represent a privatization of traditionally municipal responsibilities, such as street cleaning, trash removal, and park maintenance.
Such privatization is not confined to suburban planned communities. Business improvement districts, popular in many downtowns, likewise do their own cleaning, street maintenance, and policing. Some large city parks are maintained by privately supported conservancies. The privatization of public space has raised concerns among academic critics, but “public space and publicly-owned spaces are not the same thing,” writes Richard Briffault, a law professor at Columbia. “Some of the most successful public spaces — successful in the sense that they contribute to a flourishing public life — are privately owned, such as the English pub, the French sidewalk cafe, the Viennese coffee house, the German beer garden, or closer to home, Rockefeller Center, South Street Seaport, the Quincy Market Place or the Columbia University campus.”5 The village green that Bob Heuser has planned for New Daleville will be similarly publicly enjoyed, although it will be owned by the homeowner association.
Jason Duckworth is responsible for squaring the New Daleville homeowner agreement with the township. “The agreement is actually an entirely private document,” he tells me. “It’s strictly between us and the home buyer; the township is not party to it. But we’re asking them to review it, since we need to make sure that our regulations are in line with their ordinances. For example, if Londonderry Township didn’t allow pink flamingos on front lawns, w
e couldn’t permit them in New Daleville.” Bob Harsch, the township engineer; John Halsted, the solicitor; and Tom Comitta all comment on the agreement. Harsch’s main concern is the association’s ability to manage the sewage treatment system. If there were a major failure, he says, the neighbors’ water supply might be affected, and the township could be held responsible for repairing the system. Jason assures him that the sewage treatment system will be owned and operated by a public utility. In an arrangement that has become increasingly common, the utility will buy the system for a nominal sum from Arcadia and collect fees for operation and maintenance from the community association. Halsted wants to make sure that the association will be properly indemnified. Comitta’s concern is that the agreement be compatible with the traditional neighborhood development ordinance. For example, he wants it made clear to homeowners that, since the plan of New Daleville is subject to a municipal ordinance, the association cannot make any significant changes without the approval of the township. He also has some concerns about the landscaping restrictions, which limit the height of what people may plant in their gardens without the approval of the architectural review committee. Kaplin thinks he is worrying needlessly. “Do I know the difference between twenty-four-inch and thirty-six-inch shrubs? No. Do I care?”
The homeowner agreement refers to a “Handbook for Builders and Contractors.” This document, which will govern the actual design and construction of the houses, contains the material that Jason removed from the old design guidelines. In reviewing the agreement with Kaplin, Comitta suggests that a clause be added to the effect that any changes to the handbook would be “subject to the consent of the township.” Although Kaplin sometimes flippantly refers to New Daleville as “Ye Olde Neighborhood,” she has worked with Arcadia on several projects and understands that it is important for developers to have flexibility as construction progresses. “The design rules are determined by a market analysis and may require revision based on sales figures and reactions by the public,” she writes to Comitta. “My clients cannot allow the Township to have control over what will be a business decision.” She is unyielding on this point.
Community associations give developers a high degree of control while houses are being marketed and sold. At New Daleville, Arcadia will establish the association and appoint the board of directors before any houses go on sale. Since there are no homeowners, the board will consist of Christy Flynn, Jason’s associate, as president, and Susan Callaghan, Arcadia’s financial manager, as secretary and treasurer. As houses are sold, power will gradually shift to the homeowners, although majority control will remain with the developer. “Our first concern with the restrictions is to regulate the appearance of the development during the marketing period,” says Duckworth. “If a new owner breaks one of the rules, like parking an RV on their lot, or putting up a prefab storage shed, we’ll have a sales associate call them and point out very politely that they’re out of line with the agreement that they just signed. I can only remember one or two instances where we’ve ever had to take further action.” According to Pennsylvania law, once three-quarters of the houses are occupied, the developer must cede full control of the association to the homeowners. “After we hand over management of the association to the owners, they can do what they want,” Duckworth says. “What they often do is to fire the landscaper and get someone cheaper, and less good. But that’s their business.”
Community associations give homeowners a direct sense of control that is often — sadly — lacking in urban and suburban neighborhoods. The association rules are restrictive, but they apply equally to everyone. Unlike municipal zoning ordinances, which can be altered — or circumvented — deed restrictions are difficult to change. This inflexibility may prove to be a liability in the long run, since densification or future subdivision of large lots will probably be impossible, but in the short run it gives homeowners confidence that property values will be protected. Which explains why associations are so popular. According to a 1999 Gallup survey of community association members, fully three-quarters felt that their association rules were either “very” or “extremely” appropriate for the community. The survey also questioned homeowners who did not live in a community association. A scant 7 percent said that they wouldn’t join an association because they objected to “too many” rules and regulations.6 Moreover, there is evidence that buyers place a premium on private government. A recent Virginia study found that homes that were part of a community association “typically sold for 5 percent, or $14,000, more than a similar home nearby not governed by a homeowner association.”7
Although Jason Duckworth and Dave Della Porta have had many meetings with the planning commission, the preliminary plans for New Daleville have still not been approved by the Londonderry supervisors. In preparation for a vote, the township consultants and the developers meet in the township solicitor’s office to hammer out the final details. Kaplin’s father accompanies the Arcadia team. “Marc Kaplin has a reputation as an exceptionally tough and aggressive lawyer,” says Joe Duckworth, who is not at the meeting. “Having him there lets the township know that we’re serious.”
The meeting lasts three hours. “We went through every item,” Comitta tells me. “If it was legal, the lawyers discussed it; if it was technical, the engineers came up with an answer. At the end it seemed like almost everything was resolved.” Even the contentious design guidelines. It is agreed that the guidelines will not include drawings of typical houses — Jason gets his flexibility after all. But he does not get off scot-free. Arcadia agrees to hire an architectural firm to oversee the application of the guidelines. The township solicitor insists that, before the final plan of New Daleville is approved, the guidelines will be formally adopted by the township as an ordinance, and that all discussions about the guidelines must include Tim Cassidy.
During the meeting, the developers are surprised to discover that Londonderry requires them to pay a fee of $2,000 per house in lieu of providing recreation space. “It’s amazing that they never told us about it,” says Jason, “but since this ordinance was put in place just before we submitted our plans, we are liable.” The township agrees that the cost of grading the neighborhood park and putting in walking trails and play lots will be counted as a credit, which will substantially offset the recreation space fee. The issue of the cost of off-site road improvements is still up in the air. Della Porta makes a cash offer of $65,000 on the spot, but the township says it prefers to wait until the traffic consultants have completed their study.
The supervisors’ meeting to give preliminary approval to New Daleville is chaired by Fred Muller, since Howard Benner has stepped down after serving his four-year term. The new supervisor, Martha Detering, a trim woman in her early fifties, was elected last fall. “Marty lives directly across the road from me, the horse farm with a creek running through it and a riding ring,” says Cassidy. “She’s a retired schoolteacher, mother of two, and a hard-core equestrian enthusiast. Her husband, Hank, is a retired Marine pilot and principal of the local high school. They’re the best neighbors anyone could ever have, and I’m delighted that she has taken the thankless responsibility of being a township supervisor.”
Della Porta is the only one of the New Daleville team in attendance. There’s a handful of people in the audience. A young man in a wool jacket comes in. “We just got a quorum,” says Muller. “Let’s start.” Della Porta gets up and says that, except for the design guidelines, which will be voted on later, all the conditions for preliminary approval have been agreed upon, and there is no need to go over them again. “What about this blank space here?” asks Muller. He is referring to the section that describes New Daleville’s contribution to the off-site road improvements — the dollar amount has been left open. “Do you agree with the consultant’s report that suggests one thousand to fifteen hundred dollars for each peak-hour trip generated by New Daleville?” Detering asks Della Porta. According to most traffic engineers, a single-family suburban house gene
rates one car trip per day during peak hours. That means New Daleville could have to pay between $140,000 and $210,000.
“A thousand dollars sounds like the right number,” Della Porta says warily. “We thought of one thousand as the lower figure,” says Detering briskly. Della Porta answers that he isn’t aware of other projects in the area where improvement costs have been higher than a thousand dollars per trip. Now they’re horse trading. It’s clear that the two supervisors (Clair Burkhart, the third supervisor, is absent) have not discussed this between themselves, but Della Porta presses them for a decision. “Since you’re going to make a traffic study, could we agree that we will pay a thousand dollars, and if the costs are higher, then we’ll pay the extra cost, up to a ceiling of fifteen hundred?” he asks. “I’m happy with that,” says Detering. Then Muller makes a formal motion to give preliminary approval to the New Daleville plan. Detering seconds, they vote, and it’s done. The whole matter takes less than fifteen minutes.
For developers, receiving preliminary approval for a project is the critical step in an entitlement process. “Once preliminary approval is given, the township can’t back out or demand any substantive changes,” explains Della Porta after the meeting. “As long as we follow the conditions, they pretty much have to approve the final plan. They’re locked in.”
Even before the negotiations about preliminary approval were concluded, Arcadia’s engineers had started working on the final plans. Della Porta hopes to submit them to the township in a couple of weeks. The sewage module will be ready for the next meeting of the supervisors, who will then forward it to the Department of Environmental Protection. The state agency is supposed to respond within sixty days, but according to Jeff Miller, the environmental engineer, “never in history has DEP approved a drip irrigation project that quickly; they typically extend the review period.” He guesses that it may take as long as six months for the sewage module to be approved.
Last Harvest: From Cornfield to New Town Page 13
