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In keeping with the mandates of the HOA Manager Licensing Bill (HB13-1277) the Colorado Department of Regulatory Agencies is seeking the public’s comment on proposed rules for managers of community associations. The form for registering comments, and links to the statute and the proposed rules, is available here.

At first blush, the rules present some (a) opportunities for additional litigation by owners who simply want to profit from 38-33.3-123, C.R.S., and (b) opportunities to fight over what constitutes “original” records where the same materials may be preserved in electronic format.

In 2013 I defended an association at trial against an owner who claimed that he was not given the documents he demanded through a series of ambiguous, but expanding, document requests made under the Colorado Common Interest Ownership Act (“CCIOA”) sec. 317. The outcome for the Association was very good, but the expense associated with the defense of the claim was substantial. At the time, and now, it was believed that the Plaintiff was hoping to use the many requirements of CCIOA to create an opportunity for profit. These rules, unless they are carefully crafted, may only expand on these opportunities.

The take-home from these proposed rules is that the operation, governance, and management of common interest communities is only going to get more expensive and complex in the coming years. Working with an attorney now to craft a compliant contract and agreement between the HOA and its manager will undoubtedly cost a fraction of litigating over whether or not there has been compliance with whatever regulations and rules come into form in the future.