This is the ninth year I have worked on HOA legislation in Colorado.  In all of those years, I have never seen so much "stuff" packed into one bill as was packed into House Bill 16-1133 (‘HB 1133"). On Monday, the House State, Veterans & Military Affairs Committee (the "State Affairs Committee") wisely and unanimously killed HB 1133.  Here’s what the bill would have required: 

1.  It would have changed the licensure requirements for those community association managers who manage small HOAs.  It would have required the Division of Real Estate to prepare less comprehensive educational courses and examinations for these managers.  In addition, it would have lowered licensure fees for these managers – which would have increased the fees for all of the other community association managers in Colorado. 

2.  It would have required community association managers to tattle on their boards of directors to the Colorado Division of Real Estate when, in the opinion of the manager, the board is failing to comply with their governing documents or the Colorado Common Interest Ownership Act ("CCIOA").  Putting a manager in the position of being "big brother" for their boards would certainly not be conducive to a good working relationship.  In addition, this provision would have required managers to engage in the unauthorized practice of law.

3.  This bill would also have required management companies to provide detailed receipts relating to the transfer fees they charge for the conveyance of a unit.  Since Colorado law and Division of Real Estate rules already require managers and management companies to disclose their transfer fees on a yearly basis and to provide the exact amount of the transfer fee to a seller or buyer of a unit within three days of receiving a written request – there is no need for such a receipt and it would only have increased the cost of the transfer fee!  In addition, currently if a manager or management company do not disclose their transfer fees, they cannot require payment of the transfer fee and can be disciplined by the Division of Real Estate.

The action of the State Affairs Committee on Monday has put the issue of manager licensure and transfer fees to bed for the 2016 legislative session.  However, as always, stay tuned to this blog for information on other HOA bills we are following. 

 

 

 

Representative Yeulin Willett (R-Grand Junction) has introduced House Bill 16-1201  ("HB 1201") regarding how licensed professionals in Colorado must approach providing recommendations for emotional support animals (also commonly referred to as "emotional assistance animals" and "companion animals") under the Colorado Fair Housing Act.  In particular, this bill would require that licensed physicians, physician assistants, nurses, psychologists, social workers, marriage and family therapists, licensed professional counselors and addiction counselors must make the following findings prior to recommending that an individual should be permitted to have an emotional support animal:

1.  The licensed professional must make a finding that the individual requesting the emotional assistance animal has a disability as defined by Colorado law or that there is insufficient information available to make a determination that the individual has a disability; and

2.  The licensed professional must actually meet with the individual requesting an emotional support animal, prior to making a finding of whether the person has a disability which necessitates the emotional support animal.

The bill also defines a companion or emotional support animal as "an animal that provides therapeutic benefit to an individual with a mental or psychiatric disability." 

Since those of us in the HOA industry have all seen cases where professionals provide recommendations for emotional support animals when they have never met with the individual claiming to have a disability, this bill makes a great deal of sense.  In addition, on its face, the bill doesn’t seem to conflict with HUD and DOJ guidance on assistance animals.  However, great care must be taken to ensure that HB 1201 does not conflict with federal law or guidance from HUD and the DOJ. 

Stayed tuned to this blog for more information on HB 1201 as it proceeds through the legislative process. 

 

Representative Su Ryden (D-Aurora) has introduced House Bill 16-1217 ("HB 1217").  The bill expands the rulemaking authority of the Director of the Division of Real Estate and requires the HOA Information Officer to create statewide lists of election monitors and mediators and arbitrators who handle HOA issues.  The bill has been assigned to the House State, Veterans & Military Affairs Committee of which Representative Ryden is the Chair.  Here is what the bill provides:

1.      It gives the Director of the Division of Real Estate the rulemaking authority to change how the fees for the HOA Information and Resource Center are charged to HOAs.  The Director can choose: (1) a single per-unit annual registration fee; (2) a tiered per-unit annual registration fee; or (3) a single per-association annual registration fee. 

2.       It requires the HOA Information Officer to develop a statewide referral list for HOA election monitors.  In addition, it requires election monitors to report on a yearly basis:  (1) the number of requests they received to monitor elections for the previous year; (2) the number of elections he or she monitored the previous year; and (3) for each election monitored, the type and size of the HOA involved.

3.      Requires the HOA Information Officer to develop a statewide referral list of independent contractors who provide HOA-related mediation and arbitration services.  Each independent contractor shall report on a yearly basis:  (1) the number of requests they received to mediate or arbitrate an HOA matter received the previous year; (2) the number of HOA-related mediation cases they opened and closed the previous year; (3) the number of HOA-related arbitration cases they opened and closed the previous year; (4) the types of HOA-related cases they mediated or arbitrated during the previous year; and (5) for each case mediated or arbitrated the previous year, the type and size of the HOA involved.  These independent contractors are not permitted to disclose confidential information regarding mediations or arbitrations, unless permitted to do so by statute.

This bill is interesting, since the HOA Information Officer already has the authority to create the statewide lists of election monitors, mediators and arbitrators.  In addition, I am unaware of any financial difficulties of the HOA Information and Resource Center which justify the need for Director of the Division of Real Estate to be given rulemaking authority to change the fee structure for financing the Resource Center.

As always, keep your eye on this blog for information on HB 1217 as it proceeds through the legislative process. 

Representative Jovan Melton (D-Arapahoe County) has introduced House Bill 16-1149 (HB 1149) which would require HOAs created before July 1, 1992, to comply with the budget ratification provision in CCIOA.

In a nutshell, the budget ratification provision of CCIOA requires boards of HOAs to provide a summary of the proposed budget (many HOAs provide a copy of the actual budget) they have adopted to the homeowners in their HOA and to notice a budget ratification meeting for consideration of the budget.  (It is not unusual for budget ratification to be held during the annual meeting of an association.)  If at the meeting a majority of all owners (or a larger percentage as specified in the declaration) do not vote to veto the budget , the budget is automatically deemed approved – regardless of whether quorum is present at the meeting.

While I suspect this bill will make it through the House which is controlled by the Democrats, it will be interesting to see how the bill does in the Republican controlled Senate.  Stay tuned for updates on HB 1149 as it moves through the legislative process. 

 

Senator Morgan Carroll (D-Aurora) has just introduced Senate Bill 16-082 ("SB 82") which would protect folks from retaliation when they report an alleged violation of their association’s governing documents or enforce their rights under Colorado law or the governing documents of their HOA. 

If there is any retaliation against these individuals by the HOA, the board of directors, manager or any other unit owner – the person retaliated against has the right to bring legal action against those retaliating and the court may issue:  (1) an injunction; or (2) award damages, court costs, attorney fees and any other relief the court deems appropriate.

The main hole in this bill is that the term "retaliation’ should be defined to give unit owners, HOAs, boards and managers notice of what it means to "retaliate."  Defining this term would go a long way towards preventing retaliation. 

Folks who report an alleged violation or exercise their legal rights, should never be subject to retaliation!  In my humble opinion, when this happens, SB 82 provides appropriate protections for these individuals.  Frankly, since we hopefully live in a civil society, it’s unfortunate that a bill like this is even necessary. 

The first bill which would have an impact on single family home planned communities and very small condominium associations has been introduced in the House by Representative Daneya Esgar (D – Pueblo County) and Representative Michael Merrifled (D – El Paso County) and has been assigned to the House Agriculture, Livestock & Natural Resources Committee. 

House Bill 16-1005 ("HB 1005") would permit rain water to be collected from residential rooftops by the use of no more than two rain barrels with a combined storage capacity of 110 gallons or less.  Water may be collected using this method from single family homes and multi-family residences with 4 or fewer units that are set up as a "row of residences joined by sidewalls." In other words, this bill would affect single family home planned communities and small row house condominium associations or planned communities.

The bill provides that the water collected from these rain barrels must be used for outside purposes (irrigation of lawns and gardens) and must be used on the residential property where the rain was collected.  HB 1005 does not address the ability of an HOA to have architectural guidelines regulating rain barrels.  In addition, the bill specifically provides that HOAs shall not prohibit the use of these rain barrels – even if the governing documents of the association prohibit them.

Stay tuned for more information on the implications of HB 1005 for HOAs and updates on the bill as it begins moving through the legislative process.   

The 2016 Colorado legislative session is kicking off today!  While the morning will be highlighted by speeches and the requisite amount of pomp, it shouldn’t take long for legislators to get down to the nitty gritty of election year politics.

The Colorado House is controlled by the Democrats and the Colorado Senate is controlled by the Republicans.  With slim margins in both chambers, it may be difficult to get much done.  This is particularly true since legislators may be focusing on their re-election campaigns and introducing legislation that will resonate with their constituents – but may not be viable bills for passage.  However, time will tell whether initiatives will be introduced which motivate members of both chambers to reach across the aisle to seek compromise.

On the HOA front, we expect the issue of construction defects to be front and center again this year.  However, if the Metro Mayors Caucus, Denver Chamber of Commerce and builders hope to get anything passed – I suspect they will need to pivot and work on a compromise bill that doesn’t destroy homeowner rights to hold builders responsible for their defective construction.  The Construction Defect Action Reform Act (CDARA) is not perfect and should be fixed.  However, this cannot be accomplished until this coalition is willing to seek a constructive and meaningful compromise.  Check out this article from the Denver Post on the legislative climate in 2016 for construction defects.   

Since the licensure of community association managers has gone live and some small HOAs are not happy about it, we may see a bill which attempts to drill down on which managers must be licensed.  We may also see a bill which attempts to prohibit the transfer fees which management companies are permitted to charge for the services they perform related to the conveyance of a home in an HOA.  if bills on either of these issues are introduced, I suspect they will be on a very bumpy road to passage and will not make it through the legislative process.  However, this is just my early prediction and we will have to see what happens. 

As always, stay tuned to this blog for important information on HOA bills as they are introduced and work their way through the legislative process.  Happy election year, everyone!   

I read this article in the Denver Post about a pet owner not picking up the poop of his Teacup Chihuahua in his HOA.  This association has a rule requiring all owners to pick up after their pets and is utilizing doggie DNA to figure out which dog in the community left behind the droppings.

When enforcing this rule, does it matter whether your dog is a pitiful or prolific pooper?  No!  Poop is poop and HOAs should be consistent in enforcing this rule – regardless of the size of the dog or their droppings.   

However, if your HOA is utilizing doggie DNA, please remember that under Colorado law your association must give the owner of the dog notice and an opportunity for a hearing prior to levying a fine.  Here’s a link to important information your association needs to know when enforcing covenants and rules.

It was just over a year ago that Mayor Murphy led the charge for Metro Mayors by pushing through an ordinance that destroys the right of homeowners living in Lakewood to adequately pursue remedies for construction defects to their homes.  Mayor Murphy argued that the right of HOAs, working on behalf of their homeowners, to hold builders responsible for their defective construction was hampering the development of condominiums in Lakewood and across Colorado.  Mayor Murphy was adamant that his ordinance would spur condo development in Lakewood.

A year after Murphy was able to push through his "groundbreaking" ordinance, the Denver Business Journal has reported that Lakewood has not received even one application from a developer to build a condominium.  While there has been talk by developers about building condos, no ground has been broken and no applications have been forthcoming.

Why is this?  Because the worst kept secret about all of these ordinances is that they clearly violate home rule.  In other words, the issue of how construction defects are addressed is an issue of statewide concern and is not unique to any particular municipality.  As a result, state law is controlling on this matter and that law is Colorado’s Construction Defect Action Reform Act ("CDARA"). 

No developer wants to get involved in protracted litigation over whether the Lakewood ordinance, or any other ordinance for that matter, is controlling and will trump CDARA.  As more and more municipalities jump on the bandwagon to destroy homeowner rights, they are proving that construction defects are an issue of statewide concern.  What developer would want to get involved in litigation on home rule that they have no hope of winning?  This is why Mayor Murphy’s ordinance hasn’t been the panacea that he so proudly proclaimed for condo construction.

Does CDARA need to be fixed?  Yes.  However, it must be fixed in a fair and balanced manner which does not destroy the rights of homeowners living in HOAs and is not unfair to developers.  It’s time for the Metro Mayors Caucus and the Denver Chamber of Commerce to sit down with all of the stakeholders to discuss common sense approaches to fixing CDARA and spurring condominium construction.  It is also time for the Metro Mayors to stop buying into the spin and to embrace and protect the rights of the citizens living in their communities.   

 

 

As the leader in providing educational opportunities for affordable housing and free market HOAs in Aspen and Pitkin County, the Aspen Pitkin County Housing Authority ("APCHA") will be hosting another free seminar on September 15th entitled:  Covenant and Rule Enforcement in HOAs:  What Boards and Homeowners Need to Know.  Here’s a description for the seminar:

What do you mean I can’t use my garage as a storage shed and have to park my car in it?  You can’t tell me what I can and cannot do in my own garage! 

There is no doubt about it, the enforcement of covenants and rules in HOAs can be a nightmare for HOA boards and homeowners.  However, it doesn’t have to be that way!  This class will focus on use restrictions found in the governing documents of your HOA, the obligation of your board of directors to enforce them, the obligation of homeowners (including members of the board) to comply with them, the importance of having use restrictions and rules which fit the priorities of your community, options which boards have for enforcement and related protections for homeowners.  We will also make sure to cover the hot topics of restrictions on marijuana and dogs.  This class will provide important information and is sure to be entertaining!

Date of Seminar:  Tuesday, September 15, 2015

Time:  11:30 am to 1:30 pm

Location:  Aspen City Council Chambers, located at 130 South Galena Street in Aspen

Presenter:  Molly Foley-Healy, Esq.

For more information and to RSVP for this seminar, please call APCHA at 970-920-5050.  We look forward to seeing you on Tuesday!