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Common Interest Ownership Communities in the Commonwealth of Pennsylvania
Authorization: 2009 House Resolution 350

 

On July 2, 2009, the Pennsylvania House of Representatives passed House Resolution 350, Printer’s No. 2100, which directed the Joint State Government Commission to study the impacts of Common Interest Ownership Communities (CIOCs) on the Commonwealth and its local governments, collect information on the communities, their residents and infrastructure, tax burden and access to state funding sources. CIOCs are defined in Title 68 of the Pennsylvania Consolidated Statutes, entitled Real and Personal Property, as Condominiums, Cooperatives and Planned Communities. These communities are considered private and are typically governed by a Homeowners Association (HOAs) of residents. HOAs control CIOCs in the same way a municipal government controls traditional residential developments. In exchange for the payment of membership fees and assessments, the HOA ensures that residents are provided certain services and that common property and amenities are maintained and improved. In simple terms, the property owners are taxed by the HOA for the services it provides.

 

There are currently no requirements for municipalities to provide certain public services, such as sanitary sewer, drinking water and roadway maintenance to CIOCs that may be provided to traditional residential developments. Other municipal services, notably emergency services, are provided to residents regardless of where they live. That residents of CIOCs are fully taxed by their municipalities in addition to paying HOA fees leads many to feel they are subject to “double taxation” without receiving an equitable return of services. Conversely, municipal officials say residents are informed of HOA fees, assessments and restrictions prior to their purchase, and residents willingly choose to reside within CIOCs for the amenities they offer.

 

House Resolution 350 directed this study to report on the number of CIOCs in each county and municipality. Though a survey, the Commission staff contacted dozens of municipal, county, and state agencies and found there is no official count made of CIOCs by any government agency in the Commonwealth. While we believe most of the survey respondents provided accurate data, there is no way to know with any degree of certainty as no entity is currently required to maintain data on CIOCs, and they are not required to register with any entity. Further, the resolution directed the study to report on the amount of annual local and state taxes paid by CIOC residents. These data are similarly unavailable. No government agency, either municipal or state, keeps an account of how many Pennsylvania residents live in CIOCs and how much they pay in taxes.  The resolution directed that the study report on the “amount and age of current infrastructure” in CIOCs. With no local or state count of the CIOCs, no means of locating CIOCs, and no agency or association that collects comprehensive data on CIOCs, it is not possible to identify the amount and age of infrastructure in CIOCs.

 

Despite the lack of usable data and Commission staff’s necessary reliance on anecdotal information, this report offers a more comprehensive review of CIOCs than has been previously available. Despite the friction between HOAs and municipalities on the subject of taxation, there are avenues for cooperation between government entities and private communities. Further, the Commonwealth may need to make resources available to private communities when deteriorating infrastructure poses potential hazards to residents outside of CIOC’s. The report’s conclusions offer many practical solutions to current problems, and present many policies that could ease future difficulties with the continued growth of CIOCs as a housing option in the Commonwealth.


 

JOINT STATE GOVERNMENT COMMISSION - GENERAL ASSEMBLY OF THE COMMONWEALTH OF PENNSYLVANIA
108 FINANCE BUILDING - HARRISBURG, PA 17120