Boulder Condos HOA Q&A

Tom Hindeman, the HOA answer man has some more great Boulder condos Q&A and I thought that you’d want to have the opportunity to read some more of his wisdom regarding Homeowner Association Questions. While I get a buyer every once in a while that doesn’t want to live in a subdivision with an HOA it’s more common that it’s the other way around. While an HOA usually makes it better for the group, it’s sometimes more difficult for the individual depending on your personal preferences and needs. It’s important to know your rights and the terms of the rules.

Living in a homeowner or condominium association has become the norm for an ever-growing number of homeowners. Relationships between community associations and owners can become strained, but it doesn’t have to be that way. Tom Hindman, a leading Colorado authority on HOA law, provides both legal and common sense solutions to the sometimes-contentious issues that arise form community association living.

Below are questions followed by Hindman’s answers.

Q. My board has announced its decision to re-side our units this summer at the cost of $5000 per owner. They have stated that owners who do not have available funds are expected to obtain personal loans! Is this lawful?

A. Your association’s declaration should state who has the obligation for maintaining, repairing and replacing siding. This obligation typically falls on the association in townhome and condominium communities. However, associations often don’t have the necessary funds to pay for such expensive projects. Your declaration should be reviewed to determine what options are available to fund the project. Often associations may impose special assessments, take out bank loans, or a combination of the two to pay for these types of ‘capital improvement’ projects. Many declarations also require associations to obtain owner approval prior to taking any of these actions.

Assuming your declaration grants your board the authority impose special assessments and all requirements to do so were met, you board may legally impose one to pay for the siding project. However, it is unlikely that the board has the authority to require owner to obtain personal loans to pay for any levied assessments. How and from what funds each owner chooses to meet their obligation should be up to each owner.

Q. My association just hired a new landscaper who happens to be a brother of a board member. At the board meeting where the vote on who to hire was taken, this board member voted in favor of hiring his brother. Isn’t this improper?

A. The Colorado Common Interest Ownership Act. (CCIOA) states that boards are governed by the conflict of interest section of the Colorado Revised Nonprofit Act. The act defines a conflicting interest transaction as “a contract, transaction or other financial relationship,” between 1) an association an a board member, 2)between the association and a party related to the board member or 3) between the association and an entity in which a board member is an director or officer or has a financial interest. Therefore, a conflict of interest does exist when a board member is a director or officer or has a financial interest. Therefore, a conflict of interest does exist when a board member’s brother owns the landscaping company the association is considering hiring. However, the Act does allow a conflicted board member to vote on the issue at hand after disclosing his or her conflict of interest. If a conflicted board member does choose to vote, the conflicting interest transaction must also be authorized, approved or ratified by an affirmative vote of majority of non-conflicted board members. Therefore, if the above conditions were met, the board member’s actions were proper.

Associations may decide to treat board member conflicts of interests more strictly than state law by adopting a broader definition of conflict of interest and/or prohibiting conflicted board members from voting. In many cases, I advise conflicted board members not to vote to avoid the appearance of self-dealing and to build confidence in the board’s integrity.

By Tom Hindman

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November 9, 2007 | Filed Under Boulder Condos 

Comments

3 Responses to “Boulder Condos HOA Q&A”

  1. Kalpana Parekh on July 12th, 2009 12:06 am

    Is HOA responsible to maintian all proporties, or can we vote not to maintain some of the properties which are unoccupied for now?

    Can we then recover all back dues from the new home owners of these properties and have them bring their properties to HOA standard at their own expense and continue paying their dues on the monthly basis?

  2. steven terjak on November 11th, 2009 9:45 am

    The upstairs neighbors have a large dog (german shepherd size), and it whines and rattles a doggie door when the owners leave. additionally, it runs in the 900sf condo – end to end, and i get to hear all the noise. is this legal to own a dog in the condo – especially when it is immediately above another unit? are there published rules and regulations forthis kind of pet ownership?

  3. Zachary on November 11th, 2009 12:48 pm

    Each Homeowner’s association is going to have different by-laws, and other rules that govern how things work within that particular development.
    The best thing to do it to review the Declarations, By Laws, and other governing documents to see how they address your issues, and then the next step is to consider contacting the Board of the HOA, and attending the next association owner’s meeting.

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