First off, I would like to thank all of you who responded to our Call to Action to contact members of the House Finance Committee to ask that they report House Bill 19-1212 (“HB 1212”) out of Committee without any amendments.  Your commitment to help us get HB 1212 out of the Finance Committee worked.  On April 17th, the Finance Committee reported HB 1212 out of Committee without amendments on an 8 to 3 vote, which exceeded our expectations!  This morning, HB 1212 was also passed out of the House Appropriations Committee on an 8 to 3 vote and sent to the full House for a vote on second reading.  The bipartisan support of this bill in the House Finance and House Appropriations Committees was really great to see.

HB 1212 will now be voted on by the full House on second and third readings.  Given the make up of the Colorado House of Representatives, we expect the bill to be voted out of the House and sent over to the Senate for action.  The bill will be on a tight schedule, since the Colorado General Assembly is scheduled to adjourn on May 3rd.  To that end, it’s essential that HB 1212 clears the House and makes it through the Senate without any further amendments.  This will prevent the need for HB 1212 to go to a conference committee, which would eat up time.

Please keep your eye on this blog for updates on HB 1212 as it continues to move through the legislative process and for Calls to Action that may be necessary to keep the bill moving without amendments.

 

 

As you probably know by now, the Community Association Manager Licensure Program (“CAM Licensure Program”) in Colorado is currently scheduled to end on the last day of June.  To ensure that the licensure of Community Association Managers continues, House Bill 19-1212 (“HB 1212”) was introduced in the House of Representatives by Representative Brianna Titone and Representative Monica Duran to improve the CAM Licensure Program and extend it through August of 2024.

 

HB 1212 cleared the House Committee on Transportation & Local Government with amendments and is currently scheduled to be heard on Wednesday, April 17th by the House Finance Committee.  Since the fiscal note on the bill is rather insignificant, HB 1212 should normally sail through the Finance Committee with no issues.  However, some folks have been lobbying members of the Committee to water down this important licensure program by asking this Committee to amend HB 1212 to convert it into a voluntary certification program.

 

What would that mean?  It would mean that that the investment which management companies and community association managers have already made to be licensed will be lost. It also means that managers will no longer be required to demonstrate through passage of an examination that they have the core competency necessary to effectively manage their communities.  In addition, it means the managers will not be required to participate in continuing education to keep them current on changes in the law impacting HOAs and on the latest industry standards relating to management and governance of HOAs.

 

We need your help to ensure that HB 1212 is reported out of the House Finance Committee on Wednesday without amendments!  By Wednesday morning, please call and email the members of the House Finance Committee to ask them to pass HB 1212 out of Committee without amendment. Tell them the following:

 

  • The Community Association Manager Licensure Program has elevated the profession of community association management by ensuring that managers of these communities have demonstrated the basic competencies required to effectively manage HOAs in Colorado;
  • Since a home is typically the largest investment anyone will make in their lives, boards, homeowners and residents of HOAs have a right to expect that the manager of their HOA is competent to manage their community; and
  • The Community Association Manager Licensure Program has been essential in promoting the competent management of HOAs and must be continued to ensure that HOAs are well managed and to protect the investment the citizens of Colorado have made in their homes. 

Members of the House Finance Committee

Representative Leslie Herod,   Chair 303-866-2959

leslie.herod.house@state.co.us

 

Representative Kerry Tipper 303-866-2939

kerry.tipper.house@state.co.us

 

Representative Susan Beckman 303-866-2953 susan.beckman.house@state.co.us
Representative Adrienne Benavidez 303-866-2964

adrienne.benavidez.house@state.co.us

 

Representative Shannon Bird 303-866-2843

Shannon.bird.house@state.co.us

 

Representative Rod Bockenfeld 303-866-2912

rod.bockenfeld.house@state.co.us

 

Representative Matt Gray 303-866-4667

matt@matthewgray.us

 

Representative Janice Rich 303-866-3068

janice.rich.house@state.co.us

 

Representative Shane Sandridge 303-866-2965

shane.sandridge.house@state.co.us

 

Representative Marc Snyder 303-866-2932

marc.snyder.house@state.co.us

 

Representative Tom Sullivan 303-866-5510

tom.sullivan.house@state.co.us

 

Thank you for contacting these members of the House Finance Committee and for helping us to ensure that the licensure of Community Association Managers continues!

Winzenburg, Leff, Purvis & Payne is pleased to announce the next session of our Warehouse Lecture Series, which will be held on Friday, April 12th from 8:30 am to 12:30 pm in our warehouse classroom located at 8020 Shaffer Parkway, Suite 300 in Littleton.  

The classes we will be teaching have been approved by DORA for 4 hours of Community Association Manager Continuing Education Credits.  We are also seeking approval for the classes from CAM-ICB.  Session topics include the following:

√  Fair Housing – Handicaps, Disabilities, Tales from the Trenches and Lessons Learned

√  Property Insurance Coverage and Claims – Who Pays for the Damage?

√ Common Element Management and Improvements

√  Hot Topics – Reports from the Capitol, Courts and Communities

The full half-day session costs $75.00.  Individual credits for attendance at select one-hour classes are available for $20.00 per class.  To register for the half-day session or individual classes, please email Allison Grout at agrout@wlpplaw.com.  We look forward to seeing you on April 12th!

 

On Tuesday, March 26th, House Bill 19-1212 (HB 1212) finally cleared the House Committee on Transportation & Local Government with several amendments and was referred to the House Finance Committee for consideration of the Fiscal Note.  For those of you who follow this blog, you know that HB 1212 is an extremely important bill that will reenact the Community Association Manager Licensure Program in Colorado, which is set to expire on June 30, 2019, unless this bill is signed into law by Governor Polis.

Continuing this important program will protect the significant investment in licensure already made by managers and management companies across Colorado, will continue to elevate the profession of community association management and will provide important consumer protections.

Eight amendments to HB 1212 were considered in the House, with seven of them passing.  This preamended version of the HB 1212 shows the amendments to the bill which include:

• The authority of the Director of the Division of Real Estate, in consultation with the Advisory Committee, to establish by rule the credentials that will be recognized as qualifying for licensure;

• Provides that all fees, including transfer fees, must be included in the manager’s contract with the HOA or an addendum to the contract, in order to be enforceable;

• Includes a comprehensive process which must be utilized by the Division of Real Estate to investigate and adjudicate complaints brought against a licensed Community Association Manager;

• The authority of the Director of the Division of Real Estate, in consultation with the Advisory Committee, to establish rules relating to the appointment and removal of Advisory Committee Members; and

• In the future, a sunset review will be prepared to determine whether this Community Association Manager licensure program will sunset on September 1, 2025.

The heavy lifting for amendments was handled in the House Committee on Transportation and Local Government, and the House Finance Committee will next consider whether to approve the fiscal note for this program – which should not be an issue.  Once this is accomplished, HB 1212 will go before the full House for a vote on second reading of the bill.

Stay tuned to this blog for significant updates on HB 1212 as they become available.

Many Colorado communities are facing the need to impose special assessments as a result of recent wind and hail events in the state. Special assessments may be imposed in circumstances where the association lacks cash on hand to pay for a large or unexpected expense. Such assessments have become increasingly common due to changes in the insurance industry.

Historically, condominium communities and other associations that are obligated to insure roofs and exteriors against damage have paid a flat deductible for various claims. Due to the expense and frequency of hail claims, insurance companies are no longer offering flat deductible amounts, and are instead requiring associations to pay a percentage based on the value of the insured property. Now, instead of a community paying a predictable $5,000 or $25,000 for a hail claim deductible, communities are facing unexpected six-figure deductibles.

Because this change is recent, and the deductibles are high, many communities do not have sufficient cash reserves to pay the deductible. Other communities choose not to reallocate reserve funds that may be earmarked for other projects, like asphalt replacement. As a result, communities turn to their members to bear the deductible by way of a special assessment. Many homeowners have loss assessment or additional coverage on their personal insurance policies, which can help pay some or all of that special assessment.

If your community is facing an unexpected deductible and you aren’t sure how to pay for it, contact legal counsel to determine the process for undertaking a special assessment. In the meantime, as the weather starts warming, hope for rain – and no more hail!

As Lindsay Smith recently reported in a blog post, House Bill 19-1212 (“HB 1212”) was introduced in the Colorado General Assembly on Monday to extend the Community Association Manager (“CAM”) licensure program in Colorado, which is currently scheduled to end on the last day of June.

As you may recall, a bill introduced to extend the CAM licensure program during the last legislative session, was killed in the Senate which was controlled at the time by Republicans who were looking to reduce government regulation.  As a result of the recent elections, the Senate, House and Governor’s office are now controlled by the Democrats.  That means there is a strong likelihood that HB 1212 will pass both chambers of the Colorado General Assembly and be signed into law by Governor Polis.

This is great news for those CAMs and their management companies who have invested a great deal of time and money to obtain and maintain their license.  Licensure also elevates the specialized profession of community association management and provides a consumer protection for folks who live in community associations in Colorado.

HB 1212 was introduced in the House by Representatives Brianna Titone (D-Jefferson County) and Monica Duran (D-Jefferson County).  The bill has been assigned to the House Transportation & Local Government Committee and is scheduled for a hearing on March 12th.  The bill does the following:

1,  Recreates and reenacts the CAM licensure program with a sunset date of September 1, 2024;

2.  Provides that rountine ministerial functions relating to community associations may be handled by unlicensed individuals and gives the Division of Real Estate the authority to determine what functions may be carried out by unlicensed individuals and what functions must be handled by licensed CAMs;

3.  Addresses the supervision requirements relating to apprentice community association managers who are not yet licensed; and

4.  Removes the automatic acceptance of the non-state specific examination component of licensure for managers who hold the CMCA credential awarded by the Community Association Managers International Certification Board and the AMS and PCAM designations awarded by CAI National.  However, this will not affect those CAMs who are already licensed in part under the CMCA certification and the AMS and PCAM designations.

Since the likelihood that HB 1212 will ultimately be signed into law is high and the licensure program will continue, licensed CAMs should seriously consider not delaying too long in obtaining your normal 8 hours of continuing education credits needed for renewal of your license on July 1st.  In the unlikely event that the bill is killed during the legislative process, you will always benefit from continuing education courses.

Stay tuned to this blog for more information on HB 1212 as it proceeds through the legislative process.

 

 

Yesterday, Representatives Brianna Titone and Monica Duran introduced House Bill 19-1212, which, if passed, will re-create the community association manager licensure program that is currently set to end in July of this year. The proposed bill includes provisions responsive to comments made throughout the industry since the original advent of community association manager licensing, and will create a seven-member advisory committee tasked with making recommendations for rules and guidelines related to manager complaints.

We will regularly update this blog as the bill makes its way through the legislature.

On January 11th, Representatives Dafna Michaelson Jenet (D) and Colin Larson (R) introduced House Bill 19-1076 (“HB 1076”), which would amend the Colorado Clean Indoor Air Act. In addition to prohibiting smoking in many public places, the Clean Indoor Air Act also currently prohibits smoking in the restrooms, lobbies, hallways and common areas of HOAs in Colorado.

From the HOA perspective, HB 1076 would not change the fact that folks are prohibited from smoking in the restrooms, lobbies, hallways and common areas of HOAs.  However, the bill does amend the definition of “smoking” to broaden that definition to include a prohibition on the smoking of electronic smoking devices like e-cigarettes.

HB 1076 defines “Smoking” as “Inhaling, exhaling, burning, or carrying any lighted or heated cigar, cigarette, or pipe or any other lighted or heated tobacco or plant product intended for inhalation, including marijuana, whether natural or synthetic, in any manner or in any form.  “Smoking” also includes the use of an Electronic Smoking Device.”

In addition to amending the definition of “Smoking,” HB 1076 also provides that smoking is only permitted outside of the entryway of an HOA (and other public places) if the smoking takes place at least 25 feet outside of the entryway.  Currently, the Indoor Clean Air Act permits smoking which is at least 15 feet outside of any entryway.

Finally, HB 1076 eliminates exemptions to the Indoor Clean Air Act and eliminates the ability in some settings to create areas where folks are permitted to smoke.  However, these provisions of HB 1076 do not apply to HOAs.

HB 1076 will be heard before the House Health and Insurance Committee on January 30th at 1:30 pm.  Stay tuned to this blog for updates on HB 1076 as it proceeds through the legislative process.

On January 4th, the 2019 Colorado Legislative Session opened.  With both chambers of the General Assembly controlled by the Democrats, it will be interesting to see the types of bills which will be introduced that impact HOAs in Colorado.

While it will be particularly interesting to see whether a bill will be introduced to preserve the licensure of community association managers in Colorado, I have to say that the first HOA bill to be introduced is a real chin scratcher.  In fact, at least from the HOA perspective, my first impression was this xeriscaping bill is a solution in search of a problem to fix.

Representative Brianna Titone, a Democrat from Jefferson County, has introduced House Bill 19-1050 (“HB 1050 “) which would in part stop HOAs from prohibiting the use of xeriscape or drought-tolerant vegetative landscapes to provide ground covering to the common elements of common interest communities (commonly referred to as “HOAs”).  Since the boards of HOAs (and sometimes the architectural control committee, if the declaration for an  HOA provides the ARC with control over common element landscaping) typically have exclusive control over the landscaping on the  common elements, why would they need a statute to provide them with the right to xeriscape on their common elements???

While the HOA specific provision of HB 1050 is not necessary to promote the installation of xeriscapes on common elements, I am concerned that this provision could wrongly imply that owners have the right to install xeriscapes on the common elements of their HOAs.  Hopefully, CAI’s Colorado Legislative Action Committee (“CLAC”) will identify this potential problem and run an amendment to address it during the hearing before the House Energy & Environment Committee, which has not yet been scheduled.

Keep your eye on this blog for updates on HB 1050 as it proceeds through the legislative process.

 

And knowing is half the battle. – G.I. Joe

When owners in community associations sell their homes, associations and their management companies inevitably get involved in the transactions by providing governing documents for the buyers’ review and status letters showing assessments and other amounts due at the time of closing. These document disclosures typically fall within the sellers’ obligations under Section 7 of the Colorado Real Estate Commission-approved Contract to Buy and Sell Real Estate (Residential).

Effective January 1, 2019, the standard residential real estate contract form includes additional documents that sellers must disclose to buyers. This means that associations and their management companies will receive requests for different documents starting January 1st. The following table lists the documents required under the old contract and those that associations and management companies will need to gather and provide as of January 1, 2019, under the new contract:

OLD CONTRACT NEW CONTRACT
Declarations Declarations
Articles of incorporation Articles of incorporation
Bylaws Bylaws
Articles of organization Articles of organization
Operating agreements Operating agreements
Rules and regulations Rules and regulations
Party wall agreements Party wall agreements
Responsible governance policies adopted under § 38-33.3-209.5, C.R.S.
Minutes of most recent annual owners’ meeting Minutes of the annual owners’ or members’ meeting; such minutes include those provided under the most current annual disclosure required under § 38-33.3-209.4, C.R.S. and minutes of meetings, if any, subsequent to the minutes disclosed in the Annual Disclosure. If none of the preceding minutes exist, then the most recent minutes, if any.
Minutes of any directors’ or managers’ meetings during the six-month period immediately preceding the date of the Contract. If none of the preceding minutes exist, then the most recent minutes, if any. Minutes of any executive boards’ or managers’ meetings; such minutes include those provided under the most current annual disclosure required under § 38-33.3-209.4, C.R.S. and minutes of meetings, if any, subsequent to the minutes disclosed in the Annual Disclosure. If none of the preceding minutes exist, then the most recent minutes, if any.
List of all Association insurance policies as provided in the Association’s last Annual Disclosure, including, but not limited to, property, general liability, association director and officer professional liability and fidelity policies. The list must include the company names, policy limits, policy deductibles, additional named insureds and expiration dates of the policies listed.
A list by unit type of the Association’s assessments, including both regular and special assessments as disclosed in the last Annual Disclosure.

The most recent financial documents which consist of:

(1) annual and most recent balance sheet

(2) annual and most recent income and expenditures statement

(3) annual budget

(4) reserve study, and

(5) notice of unpaid assessments, if any.

The most recent financial documents which consist of:

(1) the Association’s operating budget for the current fiscal year

(2) the Association’s most recent annual financial statements, including any amounts held in reserve for the fiscal year immediately preceding the Association’s last Annual Disclosure

(3) the results of the Association’s most recent available financial audit or review

(4) list of the fees and charges (regardless of name of title of such fees or charges) that the Association’s community association manager or Association will charge in connection with the Closing including, but not limited to, any fee incident to the issuance of the Association’s statement of assessments (Status Letter), any rush or update fee charged for the Status Letter, any record change fee or ownership record transfer fees (Record Change Fee), fees to access documents

(5) list of all assessments required to be paid in advance, reserves or working capital due at Closing

(6) reserve study, if any.

Any written notice from the Association to Seller of a “construction defect action” under § 38-33.3-303.5, C.R.S. within the past six months and the result of whether the Association approved or disapproved such action.

These changes to the contract incorporate annual disclosure requirements that have applied to community associations since 2005 under Section 209.4 of the Colorado Common Interest Ownership Act (“CCIOA”). Even though associations must provide many of these documents at no cost to individual owners pursuant to CCIOA, associations can charge to fulfill title company requests for these documents.

The 2019 Contract to Buy and Sell Real Estate may affect the timing for status letter requests as well. A new provision in the contract requires the seller to request a status letter “at least fourteen days prior to the Closing Date.” Associations and management companies may need to adjust procedures to ensure that payoff amounts remain accurate for longer periods of time.

With these new requirements in mind, associations and their management companies can take the following steps to prepare for and comply with requests under the new standard real estate contract:

  • Gather and maintain all documents required for disclosure under the standard contract form.
  • Determine pricing, if any, for the bundle of documents required under the contract.
  • Consider whether to offer the status letter as part of the document bundle or on its own for a separate fee.
  • Update management contract terms to reflect any pricing for the new document package and/or status letter.
  • Consult with legal counsel as needed.

Now you know!