Colorado Homeowners Association Law Blog

The 2009 legislative session began with relatively few bills affecting Colorado common interest communities. But the last few weeks of the session more than made up for the slow start. New laws concerning community association governance do the following: (i) mandate that association boards have access to extensive, specific information to assist with their decision-making, (ii) establish qualifications for individuals serving as committee chairs, and (iii) require policies concerning reserve programs. Other laws enacted but not discussed in this article include restrictions on affordable housing units, modifications to foreclosure time frames for some borrowers, and changes to provisions of the Colorado Common Interest Ownership Act applicable to small, exempt communities. The table below gives a summary of the new laws affecting association governance, the action required by associations, and the effective dates of the laws.

For those of you who have an interest in the evolution and development of the Uniform Common Interest Ownership Act, the American Bar Association House of Delegates recently adopted the 2008 Uniform Common Interest Ownership Act as proposed by the Uniform Law Commission. This new act is an attempt to integrate, address and resolve a number of issues that have been raised in the formation, operation and management of common interest communities in the last thirty years. But, be mindful that this is only a recommended uniform act – it is not the law in Colorado (and may never be), nor any other state at this time. However, it does provide some guidance and insight into the rationale behind various provisions that we are all familiar with in the Colorado Common Interest Ownership Act ("CCIOA").

Colorado’s new law concerning carbon monoxide alarms was signed by Governor Ritter on March 24, 2009 and applies to sales, rentals and remodels of single family and multi-family residences on and after July 1, 2009. The definition of “multi-family dwelling” in the new law specifically includes condominiums, and therefore, subject to certain limitations, would apply to units in condominium associations.

Open windows during the warmer months of the year allow you to experience the fresh, Colorado air.  But sometimes that air is not so fresh.  Secondhand tobacco smoke can make its way into your home, causing irritation and potential harm.  Community associations may have a role, and an obligation, in minimizing the impact of second-hand tobacco smoke in your home.

The Colorado Clean Indoor Air Act took effect nearly two years ago, on July 1, 2006. The Clean Indoor Air Act applies to community associations and prohibits smoking in restrooms, hallways, lobbies and other common areas in any public or private buildings, including condominium buildings, and within a fifteen foot radius of building entryways.  The law does not prevent owners from smoking in their residences, and does not clearly restrict smoking on private patios or balconies, although some associations impose more stringent smoking restrictions through their recorded covenants or rules.  Colorado community associations, and individuals, in violation of the Clean Indoor Air Act may face fines.  The law establishes a fine schedule of $200 for the first violation, $300 for the second, and $500 for the third and subsequent violations.

"Going green" seems all the rage these days. From the cover of Newsweek, to hybrid vehicles, to Al Gore and the bevy of eco-friendly products at the local retail store, the push for consumer products and practices that minimize the impact on Earth and its resources has found its place in mainstream America.

Community associations, too, play a role in the green movement. New or old, common interest communities impact the Earth at both the association level and the individual homeowner level. Individuals and associations alike can implement many practices aimed at reducing energy consumption and the overall carbon footprint of their daily activities.

For the past three decades Colorado statutes concerning solar energy devices have guided community associations’ architectural policies. More recent legislation establishes mandates regarding community associations’ landscaping policies and seeks to allow homeowners to use more energy saving devices such as wind generators, retractable window awnings, and clotheslines.

As part of the changes to Colorado’s foreclosure law that become effective January 1, 2008, C.R.S. §38-38-103(1)(c) will read:

If a recorded instrument does not specify the address of the party purporting to have an interest in the property under such recorded instrument, the party shall not be entitled to notice and any interest in the property under such instrument shall be extinguished upon the execution and delivery of a deed pursuant to section 38-38-501.

Meaning, if your association’s current contact information is not listed in your Declaration, a lender foreclosure could extinguish your association’s super priority lien.

We all know that our 2006 legislature was very busy cleaning up SB-100 adopted in 2005. The legislature, in its haste to get SB 100 passed, left more than a little ambiguity in its provisions. As we’ve reported in the past, SB-89 (formally known as SB06-89) is the clean up bill. We’ve attached here a comparison chart summarizing actions associations should take, or might consider taking, based on the provisions of SB 89.

The full text of SB 100 was 28 pages long, and the full text of SB 89 is 18 pages long. Our summary is simply a paraphrasing of certain key provisions of the two acts. It is always dangerous to paraphrase statutes, as every part of a statute is important. Further, certain provisions of the statutes may be subject to other specific provisions of an association’s governing documents. Therefore, before your association takes any action based on this comparison chart, please check with your association’s attorney for specific application.

We want to let you know about an issue that is important to us at Winzenburg, Leff, Purvis and Payne, LLP. In fact we think it is important enough for all of you that we are for the first time coming out with a public opinion on a political issue. We are asking you to Vote NO on 40 which will term limit judges. Whether you are conservative, liberal, Republican, Democratic or Independent Amendment 40 is a bad idea with serious consequences which you should oppose.

Even though the proponents are pushing Amendment 40 purpose of term limiting judges as a good idea; the negatives far out-weight any gains they offer for passage.

As many of you are probably aware, Colorado recently passed Senate Bill 06-089, legislation intended to clean up provisions from last year’s SB 05-100.  Both Bills modify and add provisions to the Colorado Common Interest Ownership Act (“CCIOA”).  SB 089 creates a number of important new requirements for associations and homeowners, including mandatory procedures for a unit owner filing a claim against the association’s insurance policy and a mandatory disclosure that must be included in every residential real estate contract for property located within a common interest community.  We highlight other SB 089 amendments to CCIOA in this memorandum.

Recently, we have received a number of questions from associations as to how their SB 100 Responsible Governance Policies must be modified to comply with SB 089.  Although we cannot answer this question as to policies drafted by other law firms, it is our general opinion that few changes are required to these policies.  Nevertheless, we recommend that both the Conflict of Interest and Inspection and Copying of Records policies be modified to reflect material changes made to CCIOA by Sections 12 and 13 of SB 089.  Furthermore, we recommend that associations adopt a written dispute resolution policy by January 1st, as required by Section 5.

Please contact our office if you have any questions regarding SB 089 and its requirements.  We look forward to working with you on these matters.

On June 1, 2006, Governor Owens signed into law HB 06-1387. This is a substantial, sweeping, overhaul of Colorado's real estate foreclosure law. Among many other things done by this law, the most significant change made is the elimination of an owner's right to redeem property after a sale of the property. Lienholders still have the right to redeem. As a tradeoff for elimination of the right of redemption, owners are given a longer period of time to cure the default before the property actually can be sold at foreclosure sale.

We know you've been waiting with much anticipation the outcome of this year's legislative session. Senate Bill 06-89, the legislation intended to clean up last year's SB 05-100, was signed into law on Friday, May 26, by Governor Owens. We will be discussing in future posts how this new legislation affects SB 05-100.

SB 06-089 (seen here in its final form) is finally making its way to Governor Owens' desk. Though the heavy lifting is over, the Governor must still sign the bill if it is to be enacted. If you support the bill, you should contact Nancy Lemein, Director of the Governor's Office of Policy and Initiatives to assure that the Governor hears your voice:

Nancy Lemein
Director, Governor's Office of Policy and Initiatives
136 State Capitol
Denver, CO 80203-1792
Ph 303-866-2471

As you already know, SB 06-089 has moved out of the Senate and on to the House for review. Section 16 of the bill has remained substantially intact since the bill's introduction and readdresses C.R.S. 10-4-110.8(5), regarding homeowner's insurance.

SB 06-089 has passed through the Senate and is now on its way to the House where it will again be directed to a committee for review. As we previously mentioned, there have been amendments to the bill as it was introduced. Click here to view the bill as it left the Senate.

If you support SB 89, which is largely a clean-up bill to last year's SB 100, now is the time to call your State Senator and voice that support. The Senate could take action on this bill as early as Monday, February 27, 2006, so be sure to make contact no later than Monday morning.

If you want to help but you're not sure who your Senator is, just go to www.vote-smart.org.

SB 06-089 emerged from the Senate Judiciary Committee with some amendments on Monday. For those interested, CLAC (Colorado Legislative Action Committee) has prepared a useful matrix showing the current status of the bill, with amendments.

We already reported that your Colorado association may be responsible for another responsible governance policy under the proposed revisions to SB 100, but did you know SB 06-089 also proposes an additional disclosure under C.R.S. 38-33.3-209.4?

SB 06-089, the SB 100 clean-up bill, is scheduled to be heard in front of the Senate Judiciary Committee on February 6, 2006, at 1:30 pm. If you intend to make your comments heard prior to the hearing, you should contact your senator by February 3, 2006. You also have the option of attending the hearing.

We already told you that the SB 100 clean-up bill has been introduced. If you have not had the opportunity to review the bill yourself, you may not know that additional changes are proposed to 38-33.3-124, regarding alternative dispute resolution.

The Capitol is again bustling as our state legislators return from hiatus. As you may already know, a clean-up bill has been introduced as follow-up to last year's infamous SB 100. The bill, SB 06-089, is again sponsored by Senator Hagedorn and Representative Carroll. Keep your eye on our site for more information on the bill as it winds its way through the legislative process. A copy of SB 06-089 is here.

As you undoubtedly know by now, the first significant time sensitive obligation imposed by S.B. 100 has now passed. (You can review a copy of S.B. 100 by clicking on S.B. 100 under the "Other Resources and Lawyer Blogs" in the left margin of this page.) By January 1, 2006, virtually every common interest community was to have adopted seven mandatory responsible governance policies dealing with how it goes about adopting and amending policies, handling collections, dealing with board member conflicts of interest, conducting meetings, providing for members to inspect and copy association records, enforcing covenants and rules and imposing fines, and investing association reserve funds. If your association has not yet adopted these policies, it should do so right away. While there is no explicit remedy or penalty for an association's failure to adopt these policies, to carry out its fiduciary responsibilities, your board must adopt these policies to comply with Colorado law and avoid any liability to your members for failure to do so.

If you follow the news reports, it can sometimes seem as if community members do not appreciate the work undertaken by volunteer board members and other active homeowners. A recent nationwide study conducted by Zogby International on behalf of the Community Association Institute dispels that myth, showing, among other things, that an overwhelming 71% of residents have positive opinions of their associations.

We have discussed in previous postings that S.B. 100 (the "Act") was signed by Governor Owens on June 6, 2005. Portions of the Act became effective immediately, while the balance of the Act becomes effective on January 1, 2006. For the most part, the Act modifies the provisions of the Colorado Common Interest Ownership Act ("CCIOA"). We continue to receive a number of questions about the applicability of the Act to pre-CCIOA associations (those formed before July 1, 1992), as well as associations that were exempt from the provisions of CCIOA, and specifically, whether the mandatory responsible governance policies required by the Act must be adopted by all associations.

Occasionally, we get questions from board members and managers about members that want to not only attend meetings, but also want to record the meeting, by either audio or video means. When your association has not contemplated this request, too often the meeting can turn out like this one.

We have received a number of questions about whether SB 100 limits an Association's ability (acting through its board of directors) to make changes to its common elements - as an example, can the board change hardscape landscape improvements to irrigated sod? While SB 100 does a number of things, including imposing a number of additional requirements on the association's board of directors, the simple answer is that it does not restrict the board's authority to make this type of decision.

Let's face it. Colorado has a drier climate than, say, Florida. We live in a semiarid state and throughout history it has seen its share of droughts. Legislators certainly had this in mind when they passed S.B. 100 which, in part, stifles the ability of associations to prohibit or limit Xeriscape.

Even though no major elections are scheduled for 2005, as early as mid-September, Coloradoans may see more evidence of ballot issues and party candidates than in recent years. Section 2 of Senate Bill 100 opens the door for homeowners living within community associations to display political signs on their property up to forty-five days before an election and seven days following the day of the election. This new addition to the statutory mandates for community associations allows an association to regulate the size and number of political signs that an owner displays only if a city, town, or county ordinance also regulates political signs on residential property. If an ordinance exists, the association may not create more restrictive policies for its owners concerning political signs. If no ordinance exists, an association can only limit the number of signs that an individual owner places on her property to one sign per office or ballot issue contested in the pending election. But, where no ordinance controls, an owner cannot place signs larger than three feet by four feet on his property. Many Colorado cities, towns, and counties either do not have political sign regulations or have broad regulations that place few restrictions on the number and size of political signs permitted.

Now that SB 100 has been law for a month, we, and you, are able to start comprehending its many changes to the way community associations have historically done business. For the full text of the law as approved by Governor Owens, click here. One of the most significant changes has to do with the collection of attorneys fees from members that violate the association's governing documents.

In the current economic climate, community associations have no choice but to deal with bankruptcies being filed by homeowners who are often delinquent in their assessment payments to the association.

Everyone, except those lucky few who have been vacationing in the tropics for the last several months, knows that SB 100 is now law. Good or bad, or both, SB 100 will require some adjustment to most associations' practices. To understand SB 100, one must understand the relatively short text of the amendments but also how those amendments will affect the Colorado Common Interest Ownership Act ("CCIOA" which sounds like "KIOWA"). This sounds more difficult than it is, although some of the ambiguities in the statute will keep life interesting for a little while. Now that the dust has settled regarding the bill, we will try to examine the more relevant parts of SB 100 in an easy to understand format. Please stay tuned to our blog for a multi-part series on "SB 100 for the mere mortal." We reserve the right to change the name of the series at any time...

Introduction
Those of us involved in community associations in Colorado have been closely following the progress of SB 100, a bill introduced and sponsored by Senator Hagedorn and Representative Carroll. On June 6, 2005, Governor Owens signed the bill into law. There were more than 100 changes to the bill during its journey to becoming law. Below, we discuss the many provisions of the new law, and what they mean to community associations in Colorado. For the full text of the law as approved by Governor Owens, click here.

Almost everybody having any involvement with homeowners associations in Colorado has been following the progress of S.B. 100 in the Colorado legislature this year. On June 6th, Governor Owens signed the bill into law.