A Colorado Home Owners Association (HOA) is a non-profit corporation operating in Colorado under the Non-Profit Act, as well as CCIOA (Colorado Common Interest Community Act). It also has obligations under the Fair Housing Act (FHA), which is administered by Housing and Urban Development.
While there are several types of transparency required by statutes, often the guidance is vague. For instance, while an HOA has an obligation to notify homeowners of when and where Board meetings are held, it is vague about whether there is an obligation to notify homeowners via email, a post on a website, or through any electronic means at all. All an HOA has to do is fail to create a website and claim ignorance of email, and, technically, they can self-describe their single piece of paper taped to a wall in an obscure location as “reasonable” – because there’s no definition of reasonable a homeowner can enforce, particularly when the only means of enforcement upon a Board is through litigation.
When Boards do not operate transparently, it leads to disputes, hostility, and breaks down trust. It is therefore in the self-interest of Boards to operate as openly as possible, allowing homeowners to participate not only at meetings, but also at committee meetings, and even informally.
But, many HOA Boards find that when homeowners disagree with their opinions or decisions, it is easier to erect walls and barriers than to engage in meaningful communication. Routing communications through the CAM (Community Area Manager) may be efficient and convenient, but if after a thoughtful inquiry, the only thing the homeowner receives back is “thank you for your comments, we will take them under advisement”, it may lead to homeowners feeling that they are being ignored.
And, when participation is limited at Board meetings to short 2-minute comment periods, and the Board appears to have already made up its mind, and is only voting in public as a formality, some homeowners may wonder what happened outside of the meeting that really led to the decision. When questions are not answered, its just another brick in the wall.
To build a better HOA, Boards must have a process in place to not only survey the homeowners to get a pulse of support for various agendas and initiatives, but also a means and process by which those who are opposed can voice their concerns without being labeled as “harassers” – even if that criticism includes allegations of non-compliance or ethical concerns. The minority must be heard, says Robert’s Rules of Order, but this is a right often ignored by Boards that consider opposing opinions to be an enemy, and not an opportunity for inclusion and compromise to achieve buy-in and support for community rules and decisions.
At POHOA, strides have been made to open up governance to inspection and participation since November of 2018, when a 9-member board seemed to be caught by surprise that CCIOA governed their actions, and that Board meetings weren’t supposed to be private meetings in each other’s homes. Some vociferously opposed such an arrangement citing years of experience elsewhere – but we were not compliant with state law.
Similarly, we weren’t giving homeowners sufficient notice, or allowing full participation prior to each and every vote. Not to mention we had Board members who defied compliance with our governing documents requiring use of Robert’s Rules of Order in running our meetings – rules that also define certain aspects of transparency.
So, we’ve come a long way.
But, recently, we’ve learned that the ACC (Architectural Control Committee) is now meeting by email, per the ACC chairperson’s own description at the October 2022 Board Meeting. Since there’s no Action Without A Meeting prior to ACC votes by email, homeowners are not able to see transparently into this process, and there’s scant reporting in the meeting minutes, or actual publication of ACC meeting minutes.
Since the ACC has the obligation to author or amend the Guidelines and Rules that are the heart of most enforcement actions by the Association, the agenda for the ACC should be open to input from homeowners who have for years questioned decisions related to things like chickens and fences.
Included in this topic is the issue of Document Requests. Recently, Colorado created a statute that imposes a penalty upon HOAs that do not respond in a timely manner to requests for documents – up to $500. While POHOA has previously ignored document requests with impunity, their reaction to this change in statutes was to create a $ 100/hr fee with a 15 minute minimum charge, and a fee for copying pages – even if documents are digital.
After investigating the matter, I can confidently state that there is no CAM in Fort Collins charging anywhere near this rate – particularly when the CAM is using an inexperienced manager who has no CAI credentials in HOA management. On top of this, DORA itself (which is the state agency overseeing HOA matters) actually has a system for updating its costs that not only charges a much less expensive $25/hr, but also allows homeowners the ability to get documents for free if the request does not exceed 1 hour of time.
This has the appearance of POHOA going in the opposite direction of the intention of legislators who had to put in place a statute to deal with widespread issues of non-transparency in Colorado. POHOA is a non-profit, and therefore, has no actual costs it can balance with such fees – unless they are charged by a CAM. And, Trademark, while legally entitled to charge some fees, isn’t free to price gouge to simply create a disincentive to transparency. Their actions should reflect their costs, and thus far, they’ve failed to produce documentation that what they are charging is in the management contract that POHOA allowed to “rollover” for the 2021-22 contract year.
In addition, Trademark and the POHOA Board engaged in a charade earlier in 2021 in an attempt to prevent recording of Board meetings. While reducing the number of meetings from monthly to quarterly, the Board, acting on direction from an insurance company attorney, attempted to bar recordings. It had one problem, only a year prior it had voted to definitively not just allow recordings, but to record the meetings themselves.
Since meetings had been moved from 7 or 7:30pm to 5:30pm, this made participation and therefore transparency less likely. Of course, if a recording existed, at least homeowners could listen or watch on their own time, and perhaps submit questions or comments post-meeting.
But, it was a charade because Trademark claimed they had a company policy barring recording of meetings. It was summarily rejected by homeowners at the January 2021 Board meeting, and as a result, the Board oddly voted to simply discontinue recording meetings themselves – a step backwards for transparency.
But, in a follow-up call to Trademark, one of their managers, Colleen, admitted that Trademark had no such company policy on recording meetings. It had merely agreed to give cover to the POHOA Board by making that false claim, likely to protect the egos of Board members who wished to make it appear that they hadn’t reversed their 2019 vote, and were merely required by their vendor to comply with their vendor’s policy.
This is a sign that the current POHOA Board is not likely to operate as transparently as possible, but only to offer the absolute minimum information, and to erect barriers to make it difficult for those with different opinions or agendas to know what is actually being planned or done. This isn’t the spirit of the law, or even the ethics endorsed by CAI. An HOA needs to be fully transparent on all matters affecting the community broadly, and not operating in secret for any reason not warranted by legal or privacy matters.
If elected to the Board, one of the first agenda items I intend to have addressed is the document request fee imposed by Trademark. It should be renegotiated if it is actually in the contract, and should be discarded if it is not. And, going forward, simple requests for digital copies of documents should be provided free of charge with reasonable limits.
I believe all meetings should be recorded to ensure accuracy of meeting minutes, as well as the opportunity for those with different schedules to get a more robust amount of information than the paltry words on Meeting Minutes. These should then be posted publicly, and the original recording preserved indefinitely. This is not only for accuracy, but also for continuity – as we seem to revisit some issues repeatedly with turnover of Board members who are unaware of what occurred prior to their service.
Finally, transparency should be applied not only to Board meetings and Actions without A Meeting by the Board, but also to Committee Meetings – which should be held openly via Zoom.
I hope to see these changes in place in 2022.