Bills would put onus on homeowners associations

DENVER — Homeowners associations and the people who manage them would be under more scrutiny under a series of bills introduced into the Colorado Legislature this week.

The measures range from requiring all community association managers to be registered by the state to restrictions on how they can collect unpaid HOA dues.

“I understand that HOAs serve a necessary role, but their powers should be balanced,” Rep. Angela Williams said Wednesday. “They need to be reasonable to protect the rights of homeowners and the association as a whole.”

The Denver Democrat is introducing two of the four measures that deal with HOAs.

One, HB1277, would require managers to be licensed by the Colorado Division of Real Estate, compelling them to take an exam to demonstrate they possess the ability to manage HOAs. That means they must show a “working knowledge” of budgeting, consumer protection laws, fair debt collection and running nonprofit operations.

The second bill would require HOAs to establish debt collection policies that give homeowners more time to pay dues and special assessment fees.

Sen. David Balmer, the only Republican who’s cosponsoring part of the package, said oftentimes HOA boards will file liens against homes whose owners don’t pay quickly enough. The Centennial lawmaker said in some cases the associations don’t give people enough time to come up with the money or offer any kind of payment plan.

“This has come to us as a bipartisan problem,” Balmer said. “We have had constituents of every type come to us with concerns that their HOAs have put on them special assessments that they cannot afford.”

Balmer said such special assessments are approved by HOA boards for special projects, but sometimes they are unreasonably high. When those homeowners can’t pay immediately, HOA boards will place liens against their property, he said.

His measure, HB1276, prevents such liens from being placed on homes for at least six months. In the meantime, those same HOAs must work out payment plans with the homeowners.

“The (bill) is modeled after the Colorado Fair Debt Practices Act,” Balmer said. “It allows homeowners the opportunity to have time to pay their homeowner dues.”

Another measure, SB183, would allow homeowners to use water-saving landscaping techniques, such as xeriscaping, without being fined by HOAs that require certain amounts or types of grass or other green spaces. The final bill, HB1134, calls on the Division of Real Estate to study regulations other states impose on HOAs and report back to the Legislature.


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