Ep 91: Drug Dealers, Bomb Scares, & Brown Grass

Marc Reich 0:00
I think anyone could have done it. It was, you had to be a little bit creative, because the problem was, they’re selling drugs. There’s potential violence. The problem wasn’t that their grass is brown, but that was an easy thing to point out. So maybe, being an attorney, I had a little more creativity in terms of what can we get these these people on

Announcer 0:26
A regular highlight of the HOA insights podcast is our board heroes feature, where we dedicate one episode each month to celebrate the remarkable efforts of HOA board members to us a board hero is one of the 2 million elected volunteers who deserve recognition for excelling in a role that often goes unnoticed. Today, we’re excited to spotlight one of these exceptional board heroes and share their inspiring story. If you match our definition of a board hero, or know someone who does, please reach out to us. Our contact details and those of our sponsors are provided in the show notes.

Robert Nordlund 0:59
Welcome back to Hoa insights, common sense for common areas. I’m Robert Nordlund, and I’m here today for episode number 91 with a special guest, board hero. I learned of our guest via a mutual friend, hearing the remarkable things he was able to get accomplished for his community. Just another volunteer board member, but a hero to his community and all in our podcast audience. I was so glad I was able to get a spot on his calendar to record this episode for you so he could share his story. Well, I hope you enjoyed last week’s episode number 90, with regular co host and management consultant Julie Adamen discussing trends we expect you’ll see in 2025 we want you to be prepared for the changes that are coming. So if you missed that episode or any other prior episode, you can find them on our podcast website, hoainsights.org, on your favorite podcast platform, or on our YouTube channel, but better yet, subscribe to the podcast. In order to get every episode delivered right to your phone or mobile device. Well, those of you watching on YouTube can see the custom mug that I have here that I got from our merchandise store, which you can browse through from our HOAinsights.org website or the show notes. And you’ll find we have specialty items like this and free board member zoom backgrounds and as a special promotion, go to the merch store, browse through the items and pick a mug you’d like to have, and if you’re the 10th person to email podcast@reservestudy.com mentioning episode 91 mug giveaway, then we’ll give that mug out free of charge to you, shipping and all well, we enjoy hearing from you, and most episodes are in response to a topic that you’ve recommended. So do stay in contact, letting us know what questions you have or topics that you’d like to hear more about. Leave us a voicemail at 805-203-3130, leave a comment on a YouTube video or send us an email at podcast@reservestudy.com but back to today’s episode, I only know our guest today, board member, Mark Reich, by the reputation shared by a homeowner in his community, a friend of mine, so today, I’ll be learning along with you about Mark and the things that he’s done for his community, Majorca maintenance Corporation. It’s a 50 home development of single family homes in a nice section of town in Southern California. They don’t have a lot of common areas there. It’s just pretty much mailboxes, an irrigation system and some landscaping assets, but lots of interesting things going on. So Mark, welcome to the program.
Robert, thank you. A pleasure to be here.
Well, tell me how long? Tell me where the story starts. How long have you lived at Mallorca?
Well, I’ve lived here for 22 years. Okay, and tell me more. Is it professionally managed?

Marc Reich 3:59
It is professionally managed. Power Stone, property management, who has been with us since 2015 and who I like a lot.

Robert Nordlund 4:07
Okay, great. So good management company, professional management. What’s your day job? Or are you retired?

Marc Reich 4:15
I am an attorney. I have my own law practice, a small partnership with two other law partners

Robert Nordlund 4:22
got it. Okay, so, homeowner, attorney, single family home in a nice section of Southern California. What got you interested in being on the board? Okay, so,

Marc Reich 4:35
one very, very nice introduction. I appreciate the hero comment, but I’m no hero, but I did step up when we had a problem neighbor. So we had a neighbor who appeared to be selling drugs out of their house. We would have cars that would drive up in the middle of the night, midnight, 1am stop for a minute. Someone would come out of the house. House, there would be an exchange of some materials. The car would drive away, and that would happen several times a week. I was not on the board at that time, but I contacted our association property manager, and because, in addition to this suspicious activity, and also we would have strange people who would stay overnight, sometimes seedy looking people. But in addition to that, they weren’t maintaining their house. They had a broken window in their garage door. Their grass was brown. They had dents in their stucco, so they were violating CCN arms. Some neighbors had come to me, because I’m an attorney, saying, What can we do about this? Can we had read about other homeowners filing Small Claims actions against hoarders that for under nuisance theories and being successful, getting judgments and then leaning the house and then foreclosing. So some neighbors came to me, said, Can we do that? And I said, Well, yeah, we can, but really, the association can, can do it for us. So let me contact the property manager. The property manager wasn’t doing anything, and the existing board wasn’t doing anything. So we had an election coming up. We have five positions on the board. So every year there’s two openings, and the other year there’s three openings, because it’s a staggered term I like. So so that year there were two positions open. So one of the neighbors who was concerned about this, and I, we ran for the board.

Robert Nordlund 6:34
So I hear lots of people run for the board on the platform of we’re going to fix the roof, or we’re going to lower the homeowner assessments, or something like that. What was your political campaign? We’re going to get rid of the drug house at 12345, Main Street. You know? How do you how do you say, well,

Marc Reich 6:54
there were, there were, there were two aspects of it. One was, you submit a written statement of your qualifications, and the written statement was, was a vanilla I’m I’ve lived in the community for blah, blah, blah. I’m an attorney. I’m an accountant. I think those experiences will allow me to be a positive contribution to the board playing vanilla. But as you may know, you know, when people get the ballots, most people throw them out, they don’t turn them in. You don’t get quorum at the meeting, right? So what I did is I had the property manager give me 20 or 30 blank ballots, and I went door to door with the blank ballots, and that’s what I said, Hey, we got a problem here. The board’s not doing anything. Me and my buddy Dan down the street, we’re going to get elected. So here, sign here, put our names in, and then here, and I’ll put in the envelope for you without deliver it to the property manager. So we stuff the ballots, and we did that, but it was, yeah, it was legitimate. So that’s how the two of us got elected to the board. And so now there’s five. We don’t control the board, but when we were board members, we were able to turn one of the board members, their attitude was, we’re not going to bother with them, because we’re never going to collect. We’re going to spend a lot of money, extra money with the property manager, with legal fees, so we’re not going to bother with that.

Robert Nordlund 8:15
In addition to the house and the front yard, I’m imagining being in disrepair. Were they also delinquent?

Marc Reich 8:23
Not at that time, okay, but when we start leaning them in retaliation, they stopped paying their dues, which was fine. That was great, so we attacked them on the three violations. One, it appeared they were having non family members stay there. And the ccnr said, if you’re going to rent to somebody, you have to provide a copy of the lease to the to the association. They didn’t provide us with a copy of any lease. So we said, that’s that’s a violation, the holes in the stucco or the debts in the stock, well, that was a violation. The broken window in the garage door was a violation, and their brown grass was a violation, and then also our CCR said that we could double the fines after every infraction. So what we started doing, we started we will normally meet four times a year, but we started having meetings every two weeks so we can double the fines when they didn’t cure the violation. Interesting.

Robert Nordlund 9:19
Okay, so you found a pressure point. The pressure point was a financial you had some you could apply some financial pain to see if you could push them out. Yeah. And

Marc Reich 9:32
so eventually, and then we, we started the Lien process and the foreclosure process. And there’s a number of months you have to do a green lien letter, then you do the lien, then you initiate the foreclosure proceedings. If you do it a non judicial foreclosure, that’s a four month process, if things go smoothly. So we started down that road, and eventually they put the home on the market and they moved. Out, and everything was fine, although we did have that bomb scare that I told you about offline before they left.

Robert Nordlund 10:09
All right, so you’ve got a peaceful, 50 home community in a nice subdivision Southern California, and all of a sudden you have a bit of an eyesore home. And in addition to it being a bit of an eyesore, you have odd traffic. And we’re not talking about Amazon vans or UPS fans. You’re talking can I use nefarious, suspicious characters? Yes, at all times of the day or night. And you’re thinking, this is not what this community is about. What can we do? You got an ally. You not only ran for the board, you did your kissing babies, politicking, knocking on doors. And that reminds me of me getting on the board of my association and passing our special assessment. I was Knock, knock, knock on the boards. Do you know about this? You should vote yes, those kinds of things. And you got yourself elected. Okay, let me, let me wind it back, because I think there’s got to be this entire second phase of the story. But so you got on the board, and you were two out of five. You developed an ally, and you overcame the obstacle of the management company that wasn’t we helping.

Marc Reich 11:26
We fired that management company. We replaced them with another management company.

Robert Nordlund 11:30
Okay, what was your role on the board? Were you designated tiger or president? Or did they say, Okay, we’ll run the association. You just take care of the bad house. Uh,

Marc Reich 11:45
no, this is a five person board. I don’t, I don’t. We do have titles. We have a secretary or president, a vice president. The titles really are meaningless. You have a one fifth vote on whatever problems and issues that have to be addressed. I was focused on on this problem, and so we very aggressively attacked it. Now that’s kind of opposite of what my general attitude is, because generally, I think as an association and board members wield a lot of power, and I think you have you one should be very careful you mentioned, and we might talk about the four C’s later, but I have a fifth C, and that’s read carefully. If you read your CC and R, there’s a lot of things that would be a violation that really should not be a problem. I think in our association, it’s a violation if you leave your garage door open more than momentarily Well, or if you have your basketball hoop and you leave it on the sidewalk so the kids can play in the street. And those are the kinds of things I don’t want to be enforced. Okay? So I think in general, yeah, show a lot of discretion when there is a need, because there really is a danger, like in this situation or someone is not paying their dues, then I think you have to act aggressively. So this is one of the exceptions to my rule of show restraint, in which we acted very, very aggressively and we went against them for these cosmetic CC and R, but that’s because we really couldn’t prove they were selling drugs or that they were planting bombs, which, yeah, wait,

Speaker 1 13:31
wait, that’s part two. That’s part two. But no, I

Robert Nordlund 13:35
really like what you’re saying, because the board needs to function as a group. You don’t need to be unanimous, but you need to be united in what’s best for our community, and so you don’t want a I’ll be careful, crazy board member off making life hard on people for the minor infractions. So I’m glad that they had you there to, let’s say, spearhead this effort, but it was a unified board, and all five of you got together. Instead of four times a year, you got together as necessary to start to attack this real problem and to find your your leverage point, your pain point. And you started where you could with the cosmetic things and who was the famous bad guy that got tripped up,

Marc Reich 14:25
Al Capone. There you go Chicago in the 1920s or 30s. He probably murdered hundreds of people, but he was ultimately put in jail for tax evasion. Okay, well,

Robert Nordlund 14:37
to our audience, this may give you whiplash, but we’re going to go from murdering and putting in jail for tax evasion to taking a quick break to hear from one of our generous sponsors, after which we’ll be back to hear more of Mark’s story, and I want to hear about bomb scares too on today’s HOA insights podcast episode. Are you

Paige Daniels 14:57
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Robert Nordlund 15:29
and we’re back. Well, Mark you tempted us right before the break about the bomb scare. So if it’s not enough to talk about a drug house, is this a new story or a different part of the drug house story. This is part of the

Marc Reich 15:43
drama. So on on Monday morning, August 4, 2008 police was ascended on my cul de sac, evacuated houses because they had received a tip that the residents of the, what we call the drug house, had planted bombs in their backyard. It,

Robert Nordlund 16:09
it’s gone now from suspicion to now you’re you’re pressing the pain points. You have some financial leverage, you and the board, and all of a sudden, now it’s a police problem.

Marc Reich 16:20
So, yeah. So at this point in time, I had gotten on the board. My neighbor, who was concerned, had gotten on the board. We had replaced the property manager that was had been reluctant to do anything with a property manager that was being very aggressive. We had fined them multiple times. We had doubled we had Rupe the fines. We had leaned the house, and we had not yet started before closure proceedings. But it was in that time frame that there was this anonymous tip that they had bomb making materials or bombs, and so the SWAT unit came on, shout, speed, evacuated the houses, including my house, and raided the house and dug up their backyard and went into the slope, the common slope, the association property behind their house, and found what appeared to be plastic explosives.

Robert Nordlund 17:16
Geez. Louise, yes, yes. Okay, I am fortunate to not know what plastic explosives look like, but I’m glad we have SWAT teams that know, and they can take care of that.

Marc Reich 17:30
So if one would Google 2008 Rancho Santa Margarita bomb, you’ll Yeah, which I did this morning. I came, I found three articles, two from the Orange County Register and one from the LA Times. So that was august 2008 and it was in the fall that they put their home on the market. And it was the fall that we initiated the foreclosure proceedings, and they they sold. And one of the concerns of the existing board members was they didn’t want to go down this route, because we had to hire a law firm, and we incurred expenses for this, but they had equity in their house, so in the end, we submitted a bill to escrow. We got paid back every cent of what on what we had leaned them. So we actually made, yeah, a profit from the fines we put on their house, but we were not out of pocket anything which satisfy the concerns of the fiscally conservative people that weren’t, which I respect but, but they lost sight of what’s important when you have a situation that it poses a danger, a danger to the safety of homeowners. It’s worth spending money to cure that. They lost sight of that, but in the end, and cost us any money in the end, yeah, he got rid of a danger, a danger in our community. Yeah,

Robert Nordlund 18:57
again, I’m thinking about this imagining I live on a quiet cul de sac in a nice, planned community myself, and it’s one thing to have a few extra cars, maybe in the middle of the night, which I may not even know about, because I I sleep in the middle of the night, and maybe tolerating the nurse who lives down the street who works in the middle of the night, Coming and going to some degrees. You want to be a good neighbor, but you also want to make sure that when there’s suspicious and bad looking things going on, that you do the right things. And we talk about the four C’s of being a good board member, being that you care, that you’re curious what is indeed going on. You have courage to do the right thing. And you got on the board, you let go of the management company. You got a new management company, and you communicated what was going on. You got the rest of the board on your on your side, but boy, that really tips the energy a whole never direction when the SWAT team rolls in. And you’re thinking about a little drugs on the side, compared to we’re blowing up the neighborhood, so that kind of raises the stakes. So they found the plastic explosive. Am I just naive? Or are plastic explosives related to selling drugs being

Marc Reich 20:20
they’re related to selling drugs? But, but what one is a criminal, and in one aspect, maybe they’re criminals, and other aspects, so what you know? Why? Why did they? Yeah, I had heard two different stories about the bomb making materials, because ultimately, they weren’t arrested for that. And one, one story was that one of the one story was that the son of the homeowners had bought what he thought was plastic explosives, but he was hoodwinked what he bought was really plastic explosives. So when the police seized the materials, they couldn’t, I think they initially arrested, but they couldn’t make charges stick, because the it’s not a crime to buy what you think is plastic explosives when it’s not. But in looking at one of the three news articles I found this morning when I was doing my research for this podcast, one of them reported that that the police, the police brought a bomb truck, and so they put the explosives, or what appeared to be explosives, in the bomb truck, and then they exploded it, and that destroyed it. So the sparkle said they couldn’t be charged because they didn’t have any remnants of the evidence.

Robert Nordlund 21:41
Yes, she’s always okay. 2008 was that a day you were at work? And did you say I’m glad I’m at work? Or did you want to run home and see what the heck was going on?

Marc Reich 21:53
Well, I remember that because I went to work, but my wife, it was the summer, and I was taught three kids weren’t in school, and she had arranged to go with another parent with their kids, and they, I believe, they went to using either Disneyland or not. So I so we had some discussion. So they left early in the morning to do that. And I can’t remember if we were home when we were evacuated or not home when we were but my wife would be half cats and dogs, so my wife could was concerned about the pets, so there was discussion. I tried to come home from work to get the pets. What if the the cul de sac blows up? What’s gonna happen to our pets? And I was thinking, Well, if it blows up, you want me in the house trying to save the pets? But

Robert Nordlund 22:38
yeah, how do you answer your wife when she says, can you go rescue Fido? And yes, you say, I love Fido too, but I’m not ready to give my life for Fido.

Marc Reich 22:47
Well, actually, it was Sierra, and the Sierra was an incredible golden retriever night. Oh, excuse me, not Fido, but a golden retriever. Or for Sierra, I would have risked my life because that was okay, but as a practicality, I don’t think the police will let me in to get the Beatles. So, yeah, help me with that

Robert Nordlund 23:05
timeline here. Okay, so in the 2008 I’m thinking, wasn’t that the economic meltdown?

Marc Reich 23:10
Oh, yeah, you’re right, but I can’t remember what month the meltdown came. What I’m thinking came in the fall, so the meltdown was about to come by. Okay, so

Robert Nordlund 23:19
you got the house foreclosed, and it sounds like you got a new owner in there that I want to say was a normal homeowner assessment, paying member of the community.

Marc Reich 23:33
Lovely family, four young kids now, three of the kids are in college, once in graduate school, they have one remaining kid who’s a junior in high school, and then they’re going to join me as empty nesters, and in a couple of years, yes, we so we replaced that the drug house with with a wonderful family

Robert Nordlund 23:52
good and were there ever arrests made, or was it just that you said, this is not the place for you?

Marc Reich 23:59
If you go to the Orange County Superior Court website and you plug in the last name of those homeowners, you will see that the Son has been arrested. Well, at at that point in time, he had been arrested, I want to say to two to four times, but since then, he’s been arrested. Well, since then, there’s been another 30 or so criminal proceedings brought against him. And the mother of the house also had at least two criminal proceedings against her before they moved out, as had several more criminal proceedings against her since she moved out. So

Robert Nordlund 24:36
where there’s smoke, there’s fire, yes, okay, all right. And then timeline. How long was this process? I you know, before this conversation, I don’t think I was aware that this was, what, 15, 1616, years ago or so. What was the process? The timeline between understanding that you have a. Problem at the association running to get on the board, and then August, when you finally got them out, how long of a was that months? Was that a couple years?

Marc Reich 25:07
I think it’s probably a couple of years, because it’s slowly degraded and it and over time, the residents start acting weirder and bringing in outsiders to stay their house, or who would drive by for a short period of time or hang out in their house. I remember my neighbor who wanted to do these small claims, neusance actions. He also was in pretty good shape. So he would sometimes sit and he was next door to the drawing house. He would sometimes sit out on his property with a baseball bat, glaring at the people who would go in. And I thought that’s a bad idea, because, well, he has a baseball bat. They might have knives and

Unknown Speaker 25:51
guns. So

Marc Reich 25:53
I thought that. But so I want to say probably is 2006 or so when we became concerned. I live in a sub Association The so there’s a master Association, but it’s I contacted them also, but they weren’t. Neither of them were really doing much. So and then it was in the fall of of 2007 where we were having the election. I submitted my candidacy statement, and I think it was probably a January 2008 where we, I got elected to the board, and we gave the three month notice to the existing property matter, because I went back to my records and I saw the termination letter, which so they were terminated at the end of April 2008 and the the bomb scare was August of 2008 and the foreclosure proceedings began in September of 2008 but we had to do this lein pre lein process, and leins and and so I think it was probably on the fall of 2008 where they put the home on the market and they voluntarily sold to avoid the foreclosure

Robert Nordlund 26:58
process. Got it okay. So a couple year process, a few months of intensive work, I got to ask, could someone else have done this, meaning another board member, or did it require someone like you with a attorney background who just knows things? I

Marc Reich 27:17
think anyone could have done it. It was you had to be a little bit creative, because the problem was, you know, they’re selling drugs, there’s potential violence. The problem wasn’t that their grass is brown, but that was an easy thing to point out. As enforcement the city, CNRS, yes, it probably is a violation to be operating an illegal business out of your house, I would just, I would think so, yeah, but to prove that is difficult. When the brown is the grass is brown or not, that’s just an easy thing. The window being broken, that’s an easy thing. So maybe, being an attorney, I had a little more creativity in terms of what can we get these these people on, and then also having a novel once they don’t pay, whether they don’t pay their dues or they don’t pay these fines, we have the ability to lean and foreclose. I would think a properly a savvy property manager. And we have professional property managers, both at the master Association and at our small sub Association, they should have figured that out. This was known as a problem drug house and then why someone else didn’t think of this earlier. Instead, the reaction seemed to be, Let’s not mess it with these people, either, because they might retaliate. Or two, is going to cost the association a lot of money, and we don’t want to spend money that we’re not going to recover. Yeah, which was a fallacy, because it was equity in the house, so it was really plenty of money to recover.

Robert Nordlund 28:52
Yeah. Well, I like hearing that again. The Four C’s started with you caring, started out with you being curious. What is the problem here? Being courageous, applying that. I like hearing that it could have been someone else going through those steps. I like hearing that sometimes, when the management company doesn’t see it as their problem, you took it on as your problem, and you made things you made things happen. So tell me, now that we have a story arc, are you still on the board? I am still on the board. Yes, okay, yes, to solve one problem in 2007 or so and you’re still on the board. What keeps you on the board?

Marc Reich 29:35
Well, we have 50 homeowners with really no common area. We have slopes behind the house, so we hired a landscaper to maintain the slopes. We maintain the mailboxes this. There’s not a lot to do. We meet four times a year, so it’s a good group. So I stay on the board, because I think it can’t hurt to have a say on this, this body. That has could happen. A lot of that it does have a lot of authority, really, to keep things reasonable and in check and not to overreact to things. So you talk about communication, sometimes we have homeowners that. One example is that one home was having auto bill paying service pay for the association dues. But something went awry with that, and they stopped paying their dues. But they didn’t know about that. Well, the property manager goes on autopilot and they send out a form letter, but these people don’t open the letters from the association. Why? Because they know their their dues are being paid, so they on autopilot. They go four months without paying, and now they’re, yeah, they’re getting fines they don’t know about because they’re not only in the mail. We get a board packet. We meet once every three months, we get a board packet. I get wind of it because I see the delinquency in the board packet. But I know these people, so yeah, I give them a call. Hey, Laurie, do you have any idea that you haven’t been paying your dues? No, we pay it on we use it’s auto paid. And I said, Well, something happened. You haven’t been Oh, my God, I’ll take care of it. And then that’s that solves the problem. So I think being on the board allows me to intervene, to stop issues before they become issues, because most of the times the these things can be corrected if you use little common sense and a little in a little common courtesy. So maybe it doesn’t mess a sixth C, we could raise a courtesy. These contacts are going

Robert Nordlund 31:37
to get longer and longer if we’re going up to

Marc Reich 31:41
six C’s. So it’s really an easy job. We don’t have a lot of issues, but if there is a top issue, I think it’s helpful to be there to try to solve the tough issue. And we had one other tough issue in my 15 or so years on the board, which, yeah, we may not want to get into right now. Yeah,

Robert Nordlund 31:59
we’re I’m trying to bring this in for a landing. Yeah, I like hearing that you knew when to be firm and when to give grace. It reminds me of we had some very good friends, and the husband died of a sudden heart attack, and I knew where they lived. I knew the management company, and I literally called up the management company. I said, you know that the husband in this house just died. Is there any way you can put them on pause and give the widow grace for a few months to get her financial affairs squared away? They got enough problems going on right now with the loss of the Father, and they were wonderfully considerate, and they did exactly that. And there’s a time to give grace, there’s a time to be to build community, to be a good neighbor, and then there’s a time when, in the best interest of the association, you are a good neighbor by squashing the bug that’s in the community. So I I like that. Well, Mark, I want to thank you for taking the time to join us on today’s program, as we regularly do with our board heroes. In closing, I want to ask what advice you have for the board members in our audience. I

Marc Reich 33:13
think maybe a 7c is could be compassion. If you live in an association, some people take the attitude it’s me and them, and they’re coming down on me and they’re being unfair, but they are you. It is. So I think one point of advice is, get involved. Don’t be afraid to run for the board, and don’t be afraid to knock on doors, because otherwise no one while this to read the ballots and no one fills it out. So you don’t have quorum, and then just more and more problems, and then you’re right. So I think don’t be scared to get involved. It’s easy for me to say, because I have a very easy association of only 50 homes with that practically no common area to maintain. And number two, once you do get involved, realize you wield a lot of power. So use it sparingly, with discretion and with good judgment, right? I like that was be my advice,

Robert Nordlund 34:09
too. Bad judgment is not another C, or would be up to eight, yeah, well, think of a word right after we close, yes, we want to publicly acknowledge mark for performing a thankless job well and compliment the entire board of directors at Mallorca maintenance Corporation for taking their responsibility seriously to act in the best interest of their association. Well, we hope you gain some HOA insights from Mark’s story, and that it helps you bring common sense to your common area. Now remember, if you match our definition of a board hero, or know someone who does, please reach out to us. Our contact details are provided in the show notes. Thank you for joining us, and we look forward to another great episode next week.

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