Where do governance policies come from?

I recently prepared a package of the nine mandatory policies for a community association. The board of that association read the policies very carefully and sent back a number of questions, asking why I had drafted various provisions the way I had, or why I had included them at all.

When drafting the mandatory policies, there is no single source. The “nine mandatory policies” or “SB-100” policies originate from Senate Bill 05-100 signed into law in 2005. Originally there were seven mandatory policies, with the dispute resolution requirement added in 2006 and the reserve study requirement added in 2009. Since SB-100 became law there have also been many other additions and amendments to the Colorado Common Interest Act (CCIOA) and Colorado Revised Nonprofit Act that affect these policies.

Continue Reading Posted In Governance
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Manager Class on Board Meetings Rescheduled for Wednesday, July 16th

The community association manager class presented by Winzenburg, Leff, Purvis & Payne, which was originally scheduled for this Wednesday (July 9th), has been rescheduled for Wednesday, July 16th at noon.  We hope you will join us next Wednesday for "Everything you need to know about Board of Directors Meetings."  If you have not already signed up attend this free teleconference class on Colorado law, please contact Allison Grout at agrout@wlpplaw.com.

We look forward to talking with you next Wednesday!

Posted In Community Association News
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Don't Miss Out - Sign Up Today!

Have you signed up for our free manager classes on Colorado law yet?

As previously blogged by Lindsay Smith, Winzenburg, Leff, Purvis & Payne, LLP is offering free lunchtime teleconference classes for community association managers designed to help prepare managers to take the Colorado law portion of the licensing examination.  The next class is scheduled for July 9, 2014 at 12:00p.m. and the topic is “Everything you need to know about Board of Directors Meetings.” 

The class will be taught by Molly Foley-Healy, a partner at Winzenburg, Leff, Purvis & Payne.  Molly actively teaches classes to managers and board members on topics ranging from legislative updates to complying with CCIOA to effective governance. Molly is also the Chair of CAI’s Colorado Legislative Action Committee and is the author of The Capitol Chronicles column in the Common Interests magazine.

Don’t miss out on this great opportunity to get ahead of the curve in preparing for the Colorado law portion of the licensure exam before the new law takes effect on July 1, 2015! 

 

Should you wish to participate in these teleconferences, please contact Allison at agrout@wlpplaw.com.

Posted In Community Association News
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Where's my Money?

It is not uncommon for homeowners to wonder where all their dues are going.  Some owners might see their dues go up with no visible changes to the property and even get suspicious.  Of course, associations often bear a lot of expenses that are not directly related to property condition, such as insurance, management, and legal fees.  Nevertheless, owners have the right to know what their association is doing with their assessments.

If a homeowner wants to know where the money is, he or she should first request the association's annual financial statements.  These statements are an association record, and the owner has a right to view them.  The Colorado legislature intends that these statements be available at no cost to the owner, so it is advisable for associations to keep them readily available in an electronic format.

If the annual financials do not satisfy the owner, an audit or review may be an option.  Audits are performed at the discretion of the board, but members are empowered to demand audits in limited circumstances.  If the association has annual revenues or expenditures of at least $250,000.00 and at least one-third of the owners request the audit, the Association must obtain an audit using generally accepted auditing standards, performed by a certified public accountant.  If the Association has revenues or expenditures below $250,000.00, a third of the owners are entitled to demand a review, rather than an audit.

Audits are expensive, and if you find yourself in a situation where owners are requesting an audit or review, listen to the request.  There is a reason for the dissatisfaction, and if the association has properly conducted business, the audit or review will support the board's conduct.

Posted In Governance , Money Matters
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Failing to Reserve and Deferred Maintenance is a Recipe for Disaster

If you have ever served on the board of directors of an HOA, you know that some members are never happy to see their annual assessments increased.  In fact, some folks can be downright hostile when faced with an increase.  This can even be true when an assessment increase is absolutely necessary to adequately fund reserves to be financially prepared to handle major repairs and replacements to association common elements.   

When boards are unwilling to propose essential assessment increases or members are unwilling to ratify budgets with these increases, it is not uncommon to see a couple of things happen.  First, these associations tend to defer routine maintenance on common elements which reduces the remaining useful life of components like roofs, siding and asphalt.  Second, these associations may not have enough funds in reserves to cover the costs associated with these major repairs and replacements.  In such cases, without levying a special assessment or obtaining a loan to cover the associated costs, the infrastructure of these communities will begin to erode and eventually fall apart.

Continue Reading Posted In Governance
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If You're My HOA's Attorney, You Represent Me, Right? (No, Not Quite.)

As a community association attorney, I attend a lot of homeowner meetings to discuss legal issues and provide education to boards and owners. I enjoy the opportunity to meet the people who live in my client’s communities. It’s always great to put faces to names and get a feel for the relationship dynamics that make themselves apparent in the meeting space. Often, I stand out as the only person in the room wearing a suit, and I quickly get introduced as the association’s attorney or “the board’s attorney” or simply “our attorney.” This introduction provides a chance for me to answer a question that many owners in the room have: Who do you represent, Suzanne? In fact, I try to answer the following questions, quickly and concisely, with any group of owners that I am meeting for the first time:

Who does the association attorney represent? My firm represents the community association entity, not its board of directors, any of the individual directors, the manager or management company, or the members of the association.

Continue Reading Posted In Off the Top
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Family Friendly Rules

Earlier this month the Department of Housing and Urban Development (HUD) announced that it had reached a settlement with an apartment complex in the Denver Area for rules that discriminated against familial status under the federal Fair Housing Act (FHA). Readers of this blog will be aware that the FHA applies to residential community associations too, and this offending rule wouldn’t look out of place in many common interest communities:

"All children must be supervised by an adult at all times while playing outside. No sports activities, skateboarding, roller-blading, or general extracurricular activities are to take place in our community.  If we see anyone violating any of the above activities or see any unsupervised children they will be sent home immediately."

The settlement required the rules above be amended, that the apartment owner build a $10,000 playground, and that all employees of the apartment complex owner attend fair housing training within one year.

Continue Reading Posted In Community Association News
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Flying the American Flag in Observance of Memorial Day

As we contemplate the observance of Memorial Day, we need only briefly look at the news to be reminded of how lucky we are to live in the United States of America.  As we witness the repression in other countries that is unimaginable to most of us, we must remember the men and women serving in the United States Armed Forces who have died to protect the freedoms we sometimes take for granted.

In addition to attending Memorial Day services, many Americans honor our fallen members of the military by flying the American flag or service flags.  While it is rare that HOAs will prohibit the flying of these flags, here is an important reminder to those living in Colorado about the right to display the American flag and service flags in associations.   

american flag photo: american flag american-flag-3.jpg 

 

 

Posted In Governance
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A Nuisance or Not?

 All of us have complained about a loud and noisy neighbor or some other disturbance that we have deemed a nuisance at one point or other in our lives. However, we should all be thankful that none of us reside in the Plaza at Five Points Condominium Association in Sarasota, Florida. Apparently, the condominium association sits atop of a nightclub. As a single man I appreciate a good nightclub and having one downstairs from where I live sounds interesting. However, this is not just any nightclub but rather one which allegedly stages “drag queen pillow fighting and gelatin wrestling”. Some of the older residents did not appreciate the noise and activities downstairs from them and filed complaints with the city and police and, according to the club’s attorney, pressured the owner of the building to break the club’s lease. The efforts by the association apparently have failed and now the club’s owner has filed a lawsuit against the association claiming that it went too far.  www.heraldtribune.com/article/20140515/ARTICLE/140519808

Continue Reading Posted In Covenant Enforcement
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Servicemembers Civil Relief Act

 Sometimes during a collection of an account, we become aware that the homeowner is in the military.  When this happens, there are certain procedures and precautions we must take before proceeding with collections.  This is due to the Servicemembers Civil Relief Act, which affords a number of significant protections to servicemen and servicewomen who are on active duty.

Continue Reading Posted In Money Matters
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