2019 Colorado State Stakeholder Survey Results for Homeowner Associations

The results of the survey were revealed at the fourth of four stakeholder meetings at the Capitol on 10/8/19. The document below was presented on a large screen for those participating, and the results were briefly reviewed.

While the presenters at the meeting characterized this as an indication of successful HOAs, there was much criticism of the survey itself. For one, most homeowners never knew the survey was being taken – ask yourself if you heard anything about it.

Secondly, while the survey does show who participated, the results are mixed together with Community Area Managers (CAMs) and other professionals, who have a stake in outcomes that would be contrary to the interests of many homeowners.

But, most of all, the survey demonstrated a significant percentage of homeowners who are having negative experiences. And, there are patterns to these experiences that match our own in Poudre Overlook HOA. Page 20 of this deck, however, validates some of the points we have been trying to execute in our HOA:

• A need for follow the governing documents and apply them consistently and fairly
• A need for an out-of-court binding dispute resolution process
• A need for More homeowner Involvement and Participation
• A need for Board Education and Training

It’s clear that after removal of the Board led by Walker Flanary and Buck Hammond, we are on our way to rectifying past issues. Our greatest asset is our participation, which is significantly higher than most HOAs. And, now that we actually have board members who are willing to take the time to learn Robert’s Rules, the details of the governing documents, and state statutes, we are more likely to apply them consistently.

What is missing is the issue I’ve raised about barring bad faith board members from future participation. The court process for CRS 7-128-109 is too expensive, and wrought with time delays and challenges.

The State of Colorado has performed a 2019 Sunset Review of the regulatory agency, DORA, and it’s HOA Information and Resource Center. In that 5-year review, they have determined that homeowners are consumers of HOA services, and that these consumers need protection from bad-faith volunteers who are uniformed, poorly informed, or misinformed. This is leading to disputes for which there is not a reasonable means of resolving the dispute.

Their key recommendations are:

Continue the Center for five years, until 2025. 
The Center is charged with two duties: serve as the central repository for complaints related to HOAs and report the complaints in an annual report, and serve as an information resource related to HOAs. The Center receives an average of approximately 1,543 complaints per calendar year. However, it lacks the authority to act on those complaints. It also receives numerous requests for information. For example, in calendar year 2017, the Center received 5,161 requests for information. All of this illustrates that the Center serves as a useful resource for consumers. Therefore, the General Assembly should continue the Center for five years, until 2025. 

Direct the Center to implement a dispute resolution process for HOA complaints. 
Currently, the statute does not authorize the Center to investigate or impose discipline on HOAs. The original purpose for the creation of the Center was to track the number and types of complaints against HOAs. As highlighted above, the Center receives an average of more than 1,500 complaints per calendar year. The large volume of complaints against HOAs suggests that there may be many instances where consumers are experiencing harm. It is difficult to quantify the number of complaints that have merit since the Center lacks authority to investigate them. So, the potential for consumer harm exists, but the statute does nothing to address it. 

Since many complaints against HOAs exist and consumers are perhaps being harmed, a more equitable avenue to effectively address complaints would be to authorize the Center to investigate complaints. If, after an investigation, Center staff determines that a violation of CCIOA could have occurred, the Center should have the authority to enforce the CCIOA statute to correct violations. This may be accomplished by creating a dispute resolution process where the Center could act as a mediator to resolve issues between an HOA and a consumer. 

2019 HOA Sunset Review

As I stated in my article regarding removal and barring of Board Members who willfully and knowingly violate the rules and statutes, as well as those who engage in actions defined in CRS 7-128-109 (such as fraudulent or dishonest conduct), once another Board member notices the non-compliant reactions, there’s literally no good option to handle the situation. If the member is a minority on the Board, the majority can (and in our case did) obstruct and dismiss the concern out of hand with no consequences.

Worse, they can retaliate to use defamation to pressure the whistleblower into recanting or surrendering to their perceived authority. After listening to speaker after speaker recount the offenses against whistleblowers in HOAs all over the State of Colorado, it was instantly apparent that we are merely seeing symptoms of the same ultimate issue – the lack of a viable dispute resolution process.

In order to move forward and get this in place, our representatives need to hear from us. Please read through these documents and see if you see the same patterns in our HOA. Our participation and adherence to the governing documents helps, but we must push for dispute resolution that allows any of us (whether owners, committee members, or board members) to submit complaints to a higher authority for review. And, we need binding decisions that can help us avoid the internal contention that was emotionally distressful to so many.