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Concerning real estate law, private property rights, and related matters with a focus on Colorado

The power lies with the people in Colorado homeowners’ associations

February 3, 2022

If you live in a neighborhood in a Colorado city or town that is less than perhaps forty years old, odds are you live in what Colorado law dubs a “common interest community.”1 In other words, you live in a neighborhood where there is a (dreaded?) homeowners’ association (“HOA”). HOAs are now the norm for new developments. This is because the land use codes of many Colorado counties, cities, and towns all but require new developments to include some non-buildable “amenity” or “conservation” spaces that are not buildable (such as greenbelts), the care of which is vested in the HOA.

Since modern residential developments confer more and more power on HOAs, conflict is practically inevitable and the parties end up seeking legal advice. As a lawyer, there is only so much I can do in many such situations because the underlying issues are more political than legal. This is especially true when owners disagree with the HOA board members. A perfect example would be a condo development in a resort town such as Estes Park where most owners want to stop short term rentals, but the board members (most of whom rent out their units on Airbnb) disagree. Or perhaps the board is dead set on building a shiny new clubhouse even though the HOA’s finances cannot sustain that.

One political solution is to vote the board members out. This could be done at the next annual meeting, or with a special election if enough homeowners force one. However, there is another solution – amend the covenants. For every properly-created common interest community, there will be on file with the county clerk and recorder a declaration of the covenants, conditions, and restrictions. This document is commonly referred to as the “declaration,” the “CC&Rs,” or the “covenants.” Every declaration should contain an amendment provision stating the necessary votes to pass an amendment. The key point: invariably, the power to amend is vested in the homeowners. Most of the time, covenant amendments arise because the board or management company of the HOA sees a legitimate need for amendment and does the legwork. However, it does not need to be this way. There is no requirement that the HOA entity itself create the amendment, organize the vote, or approve it. There also appears to be no statute in Colorado limiting this right by requiring the HOA’s involvement.

The homeowners’ right to amend the covenants without the HOA is akin to Colorado voters’ power to amend the state constitution or change Colorado statutes without the legislature. Getting this done is not necessarily easy – it will take at least a majority of all the owners, up to 67%.2 But this is one political solution to HOA conflict that merits some thought, at the very least.

1 This is the term used by the Colorado Common Interest Ownership Act (“CCIOA”), which is the primary Colorado statute governing HOAs.

2 Some declarations provide a higher percentage, however, CCIOA will likely apply to cap it at 67%.