Legislation seeks to prune HOA powers

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As the legislative season draws to a close, lawmakers are mulling over two bills that would limit the ability of many Colorado homeowners associations to foreclose on properties over delinquent fees, as well as require community managers to be professionally credentialed.

Molly Foley-Healy, chair of the Colorado Legislative Action Committee, says HB 1176 would provide homeowners who have become delinquent in their HOA dues a one-time opportunity to enter into a six-month payment plan before the association could take other action to collect the debt.

“It’s important to remember that HOAs are nonprofit organizations,” said Westwind Property Association Business Manager Jessica Hanson. “We’re not out there to make money off the hard times of others. Any way we can work with people to get them caught up on their dues is good for the whole community.”

The bill would also require what would equal six months of past due assessments be accrued before an association or third party could foreclose on the association’s lien.

“Foreclosure should only be used as a last resort,” explained Foley-Healy, who is also an attorney practicing general community association and real estate law.

“It all sounds good, like they have my best intrest at heart, but I’m not not really convinced,” said Angelica Adams, who owns a Centennial townhome. “For me to be that far behind would be something like $2,000. I see my HOA dropping by to serve papers, not dropping by to hold my hand and try to help me stay in my unit.”

On the other hand, HB 1277 would require community association managers and management companies to be licensed, a move that Foley-Healy thinks could actually help build better relationships between HOAs and residents.

She said, currently, the industry has a wide variety of skill levels among its managers and should the bill pass, association management professionals would be required to hold the Certified Manager of Community Associations designation as a mininimum.

“Some associations’ managers have experience and credentials, and some do not,” said Foley-Healy. “Some just fell into the position and this is a way to make sure there is a basic level of compentency.”

Hanson, who already holds the CMCA certification, said the credentialing process will also help keep HOA costs down.

Better educated managers can better resolve issues and advise their client HOA boards, she said.

“It’s ususally the homeowners that wind up paying for lawsuits and settlements,” said Hanson. “Higher professional standards may help advert this.”

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