HB22-1137 FOOT DRAGGERS: Can Covenants Be Enforced Without Updating HOA Policies?

Poudre Overlook HOA is once again in the middle of a contemplative period where it needs to decide how to enforce certain provisions of the CCRs. The meeting on 1/10/23 passed a motion for the Board to do research to consider 4 options. A question that has been overlooked in this consideration is whether or not POHOA can enforce any rules at all before our policies are updated.

In May of 2022, after the entire Board resigned and the new Board began communicating, I raised as a top priority that we amend our policies for compliance with HB22-1137. The law went into effect on August 9, 2023, and I advised that we should be able to get legal advice and a policy written for presentation to the owners in advance of that deadline. Director Ballweber would not discuss the policy at all outside of meetings, and refused to put it on the agenda until September 13, 2022.

However, at that meeting, I raised the point that most other HOAs in Colorado were going to any of the HOA law firms that exist, and essentially getting these changes implemented in their governing documents for a flat fee. Instead, Director Ballweber presented a policy that either she herself wrote, or one of the homeowner-attorneys wrote, and she refused to state who wrote it. That policy attempted to avoid or circumvent other changes to our governing documents, and basically declaring that our existing Policy for Enforcement of CCRs was now void or invalid.

And, that may actually be true. Which should be motivating to get the policy updates done in case we need to enforce any rules.

Well, because of a debate over the notice period. The Policy proposed by Director Ballweber claimed a notice period could be a short as 7-days, when the minimum notice period is 30 days (and it repeats), or in cases of Health and Safety, notice can be as short as 72 hours. It is never 7 days, and should not cause confusion. So, the matter was tabled.

Less than 2 weeks later, the “dog incident” occurs, and now we are faced with choices regarding our enforcement. The problem is: If it is true our enforcement policy IS void or invalid, what Policy is the Board to follow? Is a Board just allowed to wing it and say they will follow state law because it supersedes?

Altitude Law, a firm POHOA has used in the past, posted guidance about the subject of HB22-1137 on their website on October 3, 2022:

I tried to suggest that we needed to get compliant because it is required, and doing my own research, I found multiple instances where elements of HB22-1137 in even more policies. While perhaps not “required”, if we are going to spend money on it with an attorney, we might as well do the job completely – and it would be hard to imagine an attorney who would not do a document review and identify the same need for changes.

Here is what I sent to the Board on December 30, 2022:

How much would it cost to get our documents into compliance with HB22-1137?

Based upon quotes I’ve seen like the one below, we could get the core 3 required policies done for a flat $495, and the other policies updated (some I am recommended are not just for HB22-1137, but other recent changes to statutes) for the hourly rate of $495/hr. If you notice, they are saying it’s a 1-hour job for the basics.

We’ve burned MANY more hours debating whether to update our policies, and given people like Director Flanary claiming that HB22-1137 is “convoluted”, and given that he had been directing Director Ballweber from the shadows before joining the Board (and will likely return to that role if removed), it is fair to say that we have majority on our Board that is somewhere between dragging its feet and overtly hostile to compliance with these new laws. This isn’t good for enforcement when a failure to comply gives the homeowner upon whom the rules are being enforced, a potential $25k penalty for non-compliance.

It appears, however, with the Board now poised to consider the enforcement options (which includes the option of doing nothing), that this foot-dragging may impede any timely action. If what Altitude Law says is correct, and perhaps other firms might say something different, we literally have to change our policies first – before sending the first notice!

My sense is that it is possible we will likely see yet another short-notice meeting over the near horizon to schedule a policy revision – with a USPS 10-day Notice requirement.