StoneGate Gets Its HOA Butt Spanked

guest blog by Dave Russell

For those of you who know me, messing with sick or disabled children is my biggest pet peeve. So when I heard the story about the StoneGate Homeowners Association, in Raymore MO and their board president Stacy Bayers, I did a little research. Now according to the Missouri Secretary of State’s Office, the StoneGate HOA was actually ‘dissolved’ back in 2009. I’ll get back to this later. For now, let’s take the story from the top.

Ella Schultz is only 6 years old and she’s battling cancer. The Make-A-Wish Foundation heard that little Ella wanted her very own playhouse. They contacted construction giant J.E. Dunn and that company agreed to build one in Ella’s backyard in Raymore, Missouri. They even used shingles to match those used on other homes in the neighborhood. .

What a touching story — a sick child and some awesome people who wanted to help out. That is until the HOA board officers reared their ugly little heads and threw a wrench into Ella’s playhouse. “I’m not at liberty to discuss that,” Bayers said Tuesday night when asked why it’s difficult to make an exception for Ella. “The proposed plan they’ve given us is a violation of our covenants.

KCTV 5 News (CBS) in Kansas City, has reported, “The StoneGate Homeowners Association is not in good standing with the Missouri Secretary of State’s office and hasn’t been properly registered for four years.” If you pull up the information on the Secretary of State’s website, it clearly shows that this HOA’s status is “Admin Dissolved –nonprofit.” Oh, say it isn’t so! I wonder how the reporters found out about this. No doubt one of those crazy anti-HOA people called them up.

So did the StoneGate HOA really have the legal right to deny the playhouse in the first place? You know, considering the HOA appears to have been ‘dissolved.’ Can this HOA legally enforce any of their governing documents? Has this HOA been illegally operating as a not-for-profit corporation? Are they illegally collecting assessments, fines and placing liens on properties within their Association? As one would imagine, it’s probably going to take a lawyer and judge to figure this one out. This also makes one wonder if the HOA dues they took in over the past four years should be considered taxable income.

I guess you could call this a bad case of HOA KARMA. Now StoneGate HOA president, Stacy Bayers, is doing a little backpedaling. She issued this unbelievable statement last night. Really, it’s unbelievable.

”The board has met for the better half of the day and at this time we would like to release the following statement:”

“Our hearts are with Ella Schultz and her family as they battle this terrible illness. Our homeowners’ association board is committed to working with Make-A-Wish Foundation and J.E. Dunn to see if we can figure out a way to make Ella’s wish come true. The initial request from Make-A-Wish to place a barn-style shed was not accepted because the board did not have enough information to grant an exception to the subdivision’s covenants. In hopes of getting enough information, we are requesting an immediate meeting with Make-A-Wish and J.E. Dunn Construction to work out a solution in the most expeditious manner possible.”

Oh, how nice of you Stacy Bayers, president of the StoneGate HOA, working so hard to make this little girl’s wish come true. I’m personally not buying a word of it! Neither is the rest of the world.


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Ward Lucas is a longtime investigative journalist and television news anchor. He has won more than 70 national and regional awards for Excellence in Journalism, Creative Writing and community involvement. His new book, "Neighbors At War: the Creepy Case Against Your Homeowners Association," is now available for purchase. In it, he discusses the American homeowners association movement, from its racist origins, to its transformation into a lucrative money machine for the nation's legal industry. From scams to outright violence to foreclosures and neighborhood collapses across the country, the reader will find this book enormously compelling and a necessary read for every homeowner. Knowledge is self-defense. No homeowner contemplating life in an HOA should neglect reading this book. No HOA board officer should overlook this examination of the pitfalls in HOA management. And no lawyer representing either side in an HOA dispute should gloss over what homeowners are saying or believing about the lawsuit industry.

29 thoughts on “StoneGate Gets Its HOA Butt Spanked

  1. Steve King

    Nice reporting. How about looking into the FBI and Grand Jury noise in Kansas? No one seems to want to investigate.

    1. Raylyn

      I’m sure it is not “sensational” enough for these scumbags to investigate. Little girls with cancer = puppies and babies on TV commercials

  2. Cynthia

    Thank you Dave Russell, for your activism and outreach in this situation, and also for having the moral compass to help stand up for the rights of this child and her family. Your blog is factual and accurate and cuts to the truth on how many HOAs across the country operate dysfunctionally and too many, illegally. These dysfunctional, abusive and sometimes criminal HOAs have usurped the power to devastate lives and families, destroy the families finances and reputations, negatively impact the health of the family members, and steal homes. I hope this HOA and their board are going to be facing more than just the well deserved “public embarrassment.” Every homeowner abused in this fashion, by an HOA board and/or HOA attorney, whether it be they are targeted, farmed, combed, or victim of an act of selective HOA discrimination (enforcement), should be the subject of a national news story! I thank the press for all the coverage on this story, and also, all the HOA advocates who played an active role in, offering assistance, investigating the facts, writing letters, and/or calling, and getting this story and the facts out! I trust their will be more to come on what has been going on in the Stone Gate HOA!

      1. Cynthia

        Raylyn, if only you knew those I do who genuinely care and how many got the word out to others who care!
        BTW, These news outlets cared to get the whole story too! These are just a few!

        HOA reconsiders denial of playhouse for girl battling cancer ……/girl-battling-cancer-wants-playhouse-but-homeo...
        4 days ago – The Stone Gate Homeowners Association indeed turned down the plans. … Homeowners Association is not in good standing with the Missouri …

        HOA rejects wish for girl battling cancer –…/hoa-rejects-playhouse-for-girl-battling-canc...
        4 days ago – A Missouri girl battling cancer was thrilled to hear a charity wanted to … Stacy Bayers, president of the Stone Gate Homeowner’s Association, …

        6-year-old cancer patient’s playhouse wish KO’d by Missouri ……/missouri-homeowners-associati...
        Fox News Channel
        3 days ago – The decision has been met with criticism. The Stone Gate Homeowners Association, critics say, should have OK’d the project for a sick girl who …

        Little girl battles cancer and the homeowner’s association ……/little-girl-battles-cancer-and-the-homeowners-asso…
        3 days ago – RAYMORE, MO (KCTV) — Ella Schultz is just 6 years old and she’s already … They are battling their homeowners association that has rejected her … The Stone Gate Homeowners Association indeed turned down the plans.

        Homeowners’ association denies young cancer patient’s …
        2 days ago – When Make a Wish offered to grant a wish to a six-year-old Missouri girl battling a … Stacy Bayers, Stone Gate Homeowner’s Association board …

  3. kim

    Did they ask the majority if the residents to vote on the exception? But again that would not matter if they are not a legal standing HOA, then my next question how do they have a legal board to make these decisions?

      1. DeannaDL

        Raelynn are you related to Stacy Byers or other board members? Ypu’re awfully quick to make unverified statements and support this quasi-legal organization.

  4. Kenny

    Actually D. Lucas, I think you are full of it and all you are doing is simply stirring up feelings of others instead of having them about the situation like you claim. Just like the rest of the reporters. First of all your article Neighbors at war couldn’t be farther from the truth because it has absolutely nothing to do with the residents at all. None of us that live here denied the little girl anything. And the fact you would head your article like that just provokes people even more to violence against individuals that had nothing to do with this, I’m assuming you already knew of the violent threats against the entire neighborhood since you do these so called investigations. In fact, how would you feel if your article pushed someone to carry out their threat causing another child to get hurt, oh that’s right, more to write about huh? So your feelings are irrelevant. Speaking of investigating, how about the drives and money that the HOA put together and the residents donations that all went to Ella and her family? What’s most important is that she is getting her dream play house. You only released whatever information you wanted people to see to further your agenda.

    1. Nila Ridings


      I seems apparent you are a board member so I have a question for you.

      Did the board ever stop to think how parents of a gravely ill child were going to perceive the response of NO you cannot allow Make A Wish and JE Dunn to build a playhouse for you daughter? Do you ever for one second contemplate the thought…what if her parents or somebody else contacts the media? How will our HOA appear to the general public and potential buyers?

      If those thoughts crossed your minds your answer should have been BUILD IT! You could have dealt with any repercussions from homeowners later, correct? She didn’t ask for a Merry-Go-Round with a circus and live animals in the front yard. She asked for a simple playhouse in her backyard.

      I’ve learned over the years one of the biggest problems with HOA board members is the fact they have not one iota of common sense.

      In this case just a little common sense would have gone a long way. But since nobody exercised any common sense there is a black cloud over your HOA now. Everybody that drives by your ‘gate’ is going to point and say “that’s where those heartless people live” and the stigma will take decades to pass.

      You have misdirected your anger towards the media and activists and anybody that has a different view of the board’s decision than you do. You did this to yourselves and your neighbors. Everybody will suffer reduced property values and pay the price for the mistakes of the HOA board. And many lessons have been learned from this experience. Buyers will walk away from all HOAs. HOAs will think twice before telling the parents of a child with cancer they can’t build a playhouse. And board members…hopefully your board, too…will think twice before they say, no.

      1. Raylyn

        Nila- sorry, but I know Kenny personally and he is NOT on the HOA board. NO, I’m sure no one ever stopped to think, “What if they called the media” because there was NO STORY to report other than the HOA needing a FEW DAYS to find a legal way to do this. My son had meningitis when he was little and only had a 10% chance of surviving. Does this mean that my we can add an office in a huge two story shed in my back yard? Well, my poor son has to share a room and he’s been through so much trauma already, and he shouldn’t have to share a room with his brother. So, now I’m going to go build a shed so I can move my office and give him his own room. This is not a direct comparison to Ella’s case as her situation is REAL and tragic, but it IS what would happen in a neighborhood of over 200 homes if the proper legal paperwork is not filed first for her playhouse. We hate what has happened to Ella, but just because her family has a tragedy does not mean that we all should throw our hands up and NOT care what the aftermath is if it was not done correctly! A FEW DAYS…that is all the HOA needed. IT IS DONE NOW! She gets her playhouse. My neighbors STILL can’t put a huge greenhouse in their backyard. PROBLEM SOLVED> MOVE ON!!!

        1. Nila Ridings


          I think you believe you know what you are talking about, but I know you don’t.

          First off…your board President Bayers in front of the television camera never said a word about working on a solution, contacting the attorney for legal advice, Zip. Nada. Nothing. No, she said it was against the covenants. Secondly, she had the option not to step in front of the camera at all.

          Intelligent people recognize the media is called when somebody tries unsuccessfully to get something accomplished and it fails. In this case, we don’t know who called the media, but I’ve seen both of Ella’s parents talking on camera more than once. That tells me they willingly went on camera and stated their concerns. I applaud both of them for going to the level it took to get their very ill daughter’s wish to come true! Had she been my daughter I would have let them build it and the HOA would have been the last of my concerns. Especially since her request was nothing outlandish.

          I sense you are a tad bit angry because you want to build an addition to your home and give your son a room of his own. Perhaps you can use this playhouse as a precedent and go ahead and do just that? An attorney will be able to guide you.

          On a separate note I think your entire neighborhood should be thankful this story fell into the hands of the media. Why? Because you learned the HOA was not in good standing with the Missouri Secretary of State. The HOA experts have spent countless hours discussing this. I think in time you are going to be most grateful because you don’t know what you don’t know but you will find out at some point.

          Owning in an HOA comes with massive risks. Some of us have learned that the hard way and others have learned by studying them. Fortunately, there are people like Ward Lucas, George Staropoli, Donie Vanitzian, Shelly Marshall, Sara Benson, Don DeBat, Dave Russell, Shu Bartholomew, Evan McKenzie, Deborah Goonan, Jonathan Friedrich, Dr. Gary Solomon,Robert E. Frank, Colonel, USAF (Ret.) and many others that have dedicated decades of their lives and time and money to provide an education for all of us. And, I assure you it’s a priceless education by highly educated and professional people. This website is where those who want to learn about HOAs come to read. is where they go to listen to the experts. I hope you will bury your anger and seek the education.

          There are no “scumbags”in the HOA reform activists group. These are the finest people with the highest level of integrity and concern for others that I have ever known. And I’ve known a lot of people in my lifetime. If you’re looking for the “scumbags” in the HOA industry go check out the CAI. That stands for the Community Associations Institute. You just might find them more suitable to your style.

          1. R. Reyno

            Amen, Nila, Amen. Very disturbing what is going on across the nation. We need more reporting on these issues, not less, so that people begin to hound their government to make much needed changes.

  5. Josh

    It’s obvious that the leadership of this HOA is utterly heartless, but I’d like to comment on the issue of their right to operate. It seems there’s a lot focus on the “Dissolved” status of their non-profit corporation with the state of Missouri. Many states allow HOAs and Condo Associations to operate in an unincorporated manner. Just because their corporation’s status is “Dissolved” doesn’t mean that the HOA is operating illegally. They still must file taxes each year and operate within their covenants and declaration, but being a corporation is likely not required.

    1. Raylyn

      Thank you for your comments. As to heartless: All they needed was a few days to figure out how to do it legally. This went to the media before they had finished their private meetings. OH,and the “heartless HOA” organized a “welcome home” parade for her, donated $ and meals, tied green ribbons in support on every mailbox and had a huge “Stonegate loves Ella” sign on the front gate (that was removed right before the media came to shoot video. ???) Does this sound heartless??? It was 25 degrees that week it was proposed for heavens sake. A few days is not going to hurt as is is still too cold to go outside to play.

    2. Nila Ridings

      ” being a corporation is likely not required” I see where you are coming from Josh.

      My question to you is this: If they are not in good standing with the non-profit corporation are they legally required to pay taxes on the dues collected? And if so, what corporation are they paying taxes under if the HOA non-profit corporation is no longer in good standing? And not being in good standing can they perform as a business and enforce CC&Rs? Can they place liens on property and foreclose when they are not considered a corporation any longer? If so, how can they have that authority without being incorporated in good standing?

      Wouldn’t this be something like a person that once had a medical license or a pilot’s license who let it lapse? Or even a driver’s license. Could they still practice medicine? Can they still fly? Can they still drive? I think we all know how that works. The doctor would be practicing illegally. The pilot would be flying without a license and subject to penalties by the FAA. And the driver of the car gets arrested.

      I would really like to hear what the Missouri Attorney General has to say about this.

      If there are no tax liabilities involved what prevents any other non-profit that is not in good standing from collecting revenue and not paying taxes? For example, churches that have closed their doors.

      I would venture to guess a number of HOAs that have allowed their non-profit status to lapse with their state are probably now looking to rectify their situation due to the exposure this HOA has received.

      If the incorporation of a business is not required to function as a business why would any business be incorporated other than for protection from liability? Or in the case of non-profits to be exempt from paying taxes.

  6. Cynthia

    More national coverage on this HOA and let’s be real about why this HOA has “back pedaled” and changed their minds! No matter what it took, Ella, there are countless HOA homeowner advocates and experts across the country, who want to see you get better and make sure your wish became a reality! Take care, get better and best wishes to you and your family!

    World’s Worst Homeowners Association Changes Its Mind, Allows 6-Year-Old Girl Her Make-a …
    Curbed National
    The HOA’s board president Stacy Bayers originally held that the proposed plan was “a violation of our covenants,” even though J.E. Dunn planned to …
    Homeowners association changes decision after denying 6-year-old with leukemia’s Make-A-Wish … – KTRK-TV
    Ella’s Make-A-Wish playhouse officially in the works – KCTV Kansas City
    Cancer Patient Denied Playhouse By Homeowner Association – SportAct
    Full Coverage

    1. Raylyn

      NO back peddling. If you would personally know the HOA board you would know that there were meetings being held to figure out how to get around the bylaws BEFORE the media coverage. No one is interested in getting the real facts!! Just another example of the media machine needing to be feed sensational stories.

  7. Tom

    First, I hate home owner associations. But having said that, who do you think Ms. Bayers is? In my experience, nobody wants the job, because of the time it takes up, and the people you have to deal with. Ms. Bayers, probably took the job because she felt an obligation to her community. It is unfortunate that at her one opportunity to actually make her community a better place, she was more concerned with the complaints she would undoubtedly get from a few curmudgeons. For this failure I feel sorry for her.

    1. Todd

      Tom, you feel sorry for her? Are you kidding me? She, the HOA did this to there self. There should never been ANY question on what the answer should have been. Stacy Bayers took the President Job because she loves power and likes the attention. Well she is getting the attention…. world wide. You can play anything anyway you want but it should never been a discussion…Still cannot believe it I feel sorry for her OMG

      1. Nila Ridings


        If your assessment of Ms Bayers is correct than she may be typical of many HOA presidents. Although I don’t know her personally I haven’t seen many HOA board presidents that aren’t drunk on their power.

        Perhaps this will give you some insight as to what can happen with pompous power-hungry board members. My board had a president that called the neighbors she didn’t like “pariahs” in the HOA newsletter. That newsletter was presented in front of a jury of twelve when a homeowner sued the HOA for breach of contract. The trial lasted three days but the plaintiff’s attorney looked at me when she walked off the witness stand and said, “this trial is over.” He was right, the HOA lost all counts of the lawsuit! The judge told the HOA’s attorney her first witness didn’t do her any good. During the trial we learned the newsletter was published by an “independent publisher.” Guess who that was? Yep, the HOA president. She was pocketing the advertising dollars for all the ads in the newsletter.

        Welcome to the real world of HOAs! Read through this website for some very interesting stories about the mistakes made in HOAs around the country, the corruption, and the future. Check back often…the HOA nightmare stories are endless!

    2. Nila Ridings

      Tom your question confirms exactly why HOAs are a failed concept. Volunteers without the skills or knowledge to run a business should not be in a position of running an HOA that in many cases also takes care of the maintenance of the individual properties. I do not believe that is the case in this Stonegate HOA but they do have common areas. That comes with responsibilities such as making sure the non-profit corporation renewal is kept current. It includes hiring vendors and making purchasing decisions. It also means handling other people’s money and keeping it carefully accounted for. For special projects or major repairs it requires strategic planning and project management. It requires making decisions that are not going to please everybody. It’s a lot of responsibility. And it takes a lot of time.

      All of the above requires knowledge and skill.

      Precisely, these responsibilities cause the insanity that exists in the HOAs today. Yet, we have 65,000,000 Americans living inside of these hellholes. It is a $65B industry. Yes, that is BILLION. There is little to no government oversight. Homeowners have signed away their US Constitutional Rights when they buy the property. They became business partners in a non-profit corporation with all of their neighbors. And they are the guarantor of all debts, loans, lawsuits, liabilities, construction defects and disaster rebuilds because the board can assess the homeowners for any amount they deem necessary for any reason.

      Stepping in front of a camera on local television requires one simple thing. Common sense. Simple as it might be I’ve learned very few board members in HOAs have it. Perhaps Ms. Bayers should have asked herself “Am I prepared to handle the adverse reaction from the television viewers when I say the playhouse can’t be built for a six year old with cancer because our covenants do not allow it?” Well, we all know the outcome of her not asking herself that question.

      And because of a lack of common sense, the Stonegate HOA will suffer property value losses, difficult to sell houses, and neighbors who will despise each other. The social functions will be tense and fewer people will attend. The playhouse that is intended for a place of fun and entertainment for an ill child will be the source of rising blood pressure every time the neighbors drive by. I will be surprised if the Shultz family is living there a year from now. The LAST THING they needed was more stress to deal with. But everyone should understand that any parent is going to go to the ends of the earth to make their child happy…especially one so gravely ill. If that means calling the media for help so be it.

      Sure, I feel sorry for Mrs. Bayers because she was not prepared for the consequences of her actions. And a good part of the entire world knows about it. I would expect her resignation from the board. She was the messenger and part decision maker. She failed. But I bet she has learned a great deal from this experience.

      A lot of people have learned from this experience. It opened eyes about HOAs. Some buyers will walk away from a purchase in an HOA. Others will find it hard to sell. And some will come here to this website to learn more.

      Much is learned and legislation is created from plane crashes. This is the plane crash in the HOA industry. Hopefully, it will be a teaching moment for our legislators to see how HOAs have too much control, too little oversight, and volunteers who severely lack skills to be managing them. Bottom line: Neighbors Do Not Want To Be Dictated To By Neighbors. Therefore the HOA concept was a failure from day one. It is past time to abolish the creation of them.

      And this is the reason the activists work tirelessly to stop this insanity before it gets any worse but educating the masses is the only way to do it.

    3. Nila Ridings


      I understand why you feel sorry for her BUT you know what I have yet to hear from anybody at the HOA board, Ms. Bayers included…

      I’m sorry. We’re sorry. We never meant to come across as being cold and heartless towards Ella. Not even on the Facebook page “Prayers for Ella” have I seen any words of a public apology to her, her parents, her extended family, and to the homeowners in the HOA.

      I’ve been told there is approximately 400 homes in this HOA. If each one lost just $25,000 in property value over this that is TEN MILLION DOLLARS over a board president lacking skills. A high price to pay. It would have been far less expensive to hire a professional public relations firm.

  8. Cynthia

    HOAs are structured and designated as incorporated nonprofits from inception, in every state I know of, however, I think you may be confused about HOAs under declarant (developer) control and HOAs that have been turned over to homeowners and acting as non profit businesses.

    Difference between incorporated and unincorporated businesses:

    “An incorporated business, or a corporation, is a separate entity from the business owner and has natural rights. Conversely, a business owner and an unincorporated business are the same, and the owner personally bears all results of the business. Unincorporated businesses are usually sole proprietor or partnership companies. The main difference between an incorporated and unincorporated business is the way owners shoulder business activities.”

    Now, as far as a nonprofit business in the state of Missouri, here is what the Missouri Secretary of State’s website has to say:
    “II. Nonprofit Corporations”

    “Nonprofit corporations may be organized under Chapter 355, RSMo. for a variety of purposes. Common examples include churches, civic associations, political groups and trade organizations.

    All nonprofit corporations registered to do business in Missouri are required to be designated as either “public benefit” or “mutual benefit” corporations. See Section 355.881, RSMo. for more information.

    If you intend to apply for IRS federal tax exemption as a charitable organization, your articles of incorporation must contain a required purpose clause and a dissolution of assets provision. Valuable information on 501(c)(3) qualification is on the IRS website It includes sample articles of incorporation. Click the “Charities and Nonprofits” link and then the Life Cycle of a Public Charity link.

    Please note that the Office of the Secretary of State does not grant tax-exempt status to nonprofit corporations. Nonprofit corporations seeking tax-exempt status must apply directly to the Internal Revenue Service and the Missouri Department of Revenue.”

    Further, on mutual benefit nonprofits:

    “Chapter 355, Nonprofit Corporation Law, August 28, 2014”

    “Designation of public, mutual benefit corporations.
    355.881. On July 1, 1995, each domestic corporation existing on that date that is or becomes subject to this chapter shall be designated as a public benefit or mutual benefit corporation as follows:

    (1) Any corporation designated by statute as a public benefit corporation or a mutual benefit corporation is the type of corporation designated by statute;

    (2) Any corporation which does not come within subdivision (1) of this section but is organized primarily or exclusively for religious purposes is a public benefit corporation;

    (3) Any corporation which does not come within subdivision (1) or (2) of this section but which is recognized as exempt under section 501(c)(3) of the Internal Revenue Code, or any successor section, is a public benefit corporation;

    (4) Any corporation which does not come within subdivision (1), (2) or (3) of this section, but which is organized for a public or charitable purpose and which upon dissolution must distribute its assets to a public benefit corporation, the United States, a state or a person which is recognized as exempt under section 501(c)(3) of the Internal Revenue Code, or any successor section, is a public benefit corporation; and

    (5) Any corporation which does not come within subdivision (1), (2), (3) or (4) of this section is a mutual benefit corporation.

    (L. 1994 H.B. 1095)

    Effective 7-1-95”

    1. Nila Ridings

      Thank you for researching and providing all of this Cynthia!

      When the news anchor mentioned the State of Missouri does not go after HOAs when they fail to renew their non-profit corporation status this would possibly explain why. The Secretary of State has nothing to do with the tax liabilities.

      Per this paragraph below it leads me to believe the agency that could be knocking on the door at Stonegate HOA is the IRS and the Missouri Department of Revenue. Last I heard those folks are not interested in anything but money.

      So the $1,000,000 question is how does Uncle Sam feel about a non-profit corporation that didn’t file its non-profit status renewal for 4 years?

      “Please note that the Office of the Secretary of State does not grant tax-exempt status to nonprofit corporations. Nonprofit corporations seeking tax-exempt status must apply directly to the Internal Revenue Service and the Missouri Department of Revenue.”


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