OCEANSIDE – Residents of the Oceana senior community are divided over a controversial community measure that will equalize land lease fees for everyone living in the community, lowering monthly rent payments for the majority of members while raising monthly payments for others.
Since Oceana was developed in the 1960s, 398 of its older homes in the development have been paying a flat $15 monthly rate for land lease fees, while the remaining 534 pay higher, escalating fees based on the Consumer Price Index.
The fees go towards use of the common areas throughout the community, which are subleased to the community’s homeowners association Oceanside Community Association through the common area land owner, Oceanside Land Company.
When the development was first started, owners of the earlier homes signed a sublease contract that guaranteed them a $15 monthly flat rate for the land lease, but that didn’t carry over to the additional newer homes that were built.
Steve Gillis, a resident in one of the homes that pays the higher escalating fees, discovered what he calls the community’s “dirty little secret” back in 2020 when a neighbor reached out to him with fears about losing her home due to increasing costs, which motivated him to look into the issue.
“Most people had no idea they were paying more than anybody else,” Gillis said, including himself.
Gillis, a former Wisconsin attorney, said he didn’t know about the rate disparities when he bought his house in 2012.
“Realtors weren’t disclosing it, and sellers weren’t either,” he said.
Gillis took the issue to the HOA board, which ultimately decided to put the issue on a community-wide ballot set later in March to let the residents decide whether or not to equalize the fees.
For Gillis, equalizing the land lease fees is fair considering that everyone in the community has equal access to the common areas, but many residents in the homes feel otherwise, especially with the majority of the homes with escalating fees already outnumbering them.
Together, they have formed a nonprofit organization, Flat Lease Alliance, to push back against the equalization effort and “preserve the 99 year contracts signed by every homeowner in the Oceanside Community Association.”
Residents paying escalating fees pay just over $100 more than those in the flat-rate homes, with fees increasing about every decade.
“It just irritates the heck out of them,” said Stephen Graves, one of the residents leading the Flat Lease Alliance charge. “After the increases hit, there’s a lot of hostility between the two …….