June 2013 Legislative Update

With the close of the Colorado Legislative session, several HOA related-bills have now been signed by Governor Hickenlooper, which will soon take effect into the current law.  Below is a brief synopsis of the relevant legislation.

Registration of HOAs; Regulatory Powers of the Division of Real Estate. House Bill 1134 (“HB 1134”) a) requires all HOAs (including pre-CCIOA communities) to register with the Division of Real Estate; b) simplifies the registration process; and c) requires the Division of Real Estate to conduct a study analyzing the need, associated costs and options of the Division of Real Estate to: mediate HOA complaints and election disputes; mandate mediation in such complaints; refer complaints to 3rd party mediation; create an inexpensive and speedy hearing process for Owner related complaints; and provide regulatory oversight for elections, Declarant controlled boards, and directors and residents who have been threatened or defamed. The Bill was signed on May 11, 2013; the bill will become law on August 7, 2013.

Collection Policies. House Bill 1276 (HB 1276) requires HOA Collection Policies to contain, at a minimum: the date when an assessment must be paid; the date an assessment is considered past due; any late fees and interest that will be charged to the delinquent account; and the circumstances under which the Owner is entitled to enter into a payment plan, and the minimum terms of such plan. In addition, before turning a delinquent account over to an attorney or collection agency, the association must send the Owner a notice stating: the total amount of the arrearage with an accounting of such arrearage; whether the opportunity to enter into a payment plan exists; contact information for the owner to obtain a copy of their ledger; and a notice that Owner action is required to cure the delinquency. The Bill goes into effect on January 1, 2014. Many of these requirements are new and not found in current Collection Polices. WesternLaw Group will be in touch with recommendations for your Association’s policy.

Licensure of Property Managers. House Bill 1277 (HB 1277) requires property managers to become licensed in Colorado. The property manager must a) be accredited from one of several organizations, b) take a course and pass an exam relating to Colorado law and the governing documents of associations, and c) pass a criminal background check. Property managers may be subject to discipline by the Division of Real Estate. Disciplinary measures include: fines, probation, and suspension or revocation of the license. The Bill goes into effect on January 1, 2015. However, managers will not be required to hold a license until July 1, 2015.

Xeriscaping Policies. Senate Bill 183 (SB 183) is a measure to combat the recent Colorado drought conditions by disallowing HOAs from requiring the installation of turf grass on yards. HOAs may continue to adopt and enforce design guidelines regarding drought-tolerant vegetative landscapes and the type of hardscapes which an owner may install. This Bill was signed on May 10, 2013; the Bill became law immediately.