The law increases PM business insurance costs, requires recurring
license renewal and educational costs, imposes new background check and testing
fees and for those who want to avoid State educational requirements and testing
they will incur CAI membership, educational, testing and seminar costs. These
costs have already resulted in PMs that serve smaller (less than 25 homes) HOAs
to go out of business.
The fees, business costs and government involvement would be
more tolerable if the law accomplished its’ intended goal of consumer
protection. However, the law is vague on
the most simple demands and accountability for property managers: 1) there are
no direct statements mandating PMs comply with all State laws and an HOA’s
governing documents 2) no direct statements that require PMs to advise an HOA
when they observe non-compliance with the law or to report to DORA when such
advice has been ignored and violations continue
3) no direct statements that hold
PMs accountable when they carry out requested actions of a Board that are in
non-compliance with the law or an HOAs governing documents 4) no mandates for PMs to provide home owners
with a detailed explanation or legal justification of fees and assessments
(such as the HOA Transfer Fee) they independently impose and retain and 5) no
requirement to explain and justify in detail all PM fees in their contracts
with the HOA. Repeated requests to DORA (Department
of Regulatory Services) and legislators from Colorado’s largest HOA home owner’s
group, Colorado HOA Forum, to include these simple specifics have been rejected
making reform and enforcement for home owners very difficult. Legislators also refused to include in the
Law assistance to smaller HOA PMs by reducing their licensing costs and
requirements.
Licensing also witnessed an unprecedented and disturbing legislative
act. The Law contains language directly
promoting a private entity’s (CAI) sales products and educational courses. It also allows the industry that is to be
regulated (CAI) to develop and complete State educational, testing, and credentialing
requirements none of which have been officially reviewed or approved by the
State.
Then there is the missing legislative mandate in licensing
rules to address meaningful “full disclosure” of all fees and assessments on
home owners by PMs. Specifically, the
HOA Transfer Fee that cost HOA home owners millions each year will continue
without any limits or justification. DORA
decided a one-liner on home closing documents with no receipt and/or detail of
charges is “full disclosure” of this fee.
Legislation/licensing that is
crafted by the interest group to be regulated should be disconcerting to home
owners and businesses. The CAI has
dominated the PM industry and HOA legislation in Colorado for decades. Their influence and leadership has led to the
need for licensing and reform. July 1,
2015 was to be a good beginning on reforming the abuses in the PM industry but HOA
home owners will sadly see little change.
Colorado HOA Form: an HOA Home
Owner Advocacy Organization
