Voluntary dues and CCIOA

We are in Colorado. Our covenates state that all lot owners are members but there is nothing about dues. Our articles state that there are two types of members, dues paying and non-dues paying. If you don't pay dues, you can't serve on the board. Are we a voluntary association since dues are voluntary, even though all must be members of the association?

I'm on the board and we have gotten different answers from attorneys. We would just like to continue ue as we have, paying our bills (amounting to about $3000 per year with the dues people pay voluntarily. Most of us do not want to have mandatory dues, fines, liens, ets. Not worth the hassle when we have dues of $100 per year and most pay and we have money left over. We could pay lots of legal fees when we don't really have a need. We are pre CCIOA and our covenants only state all lot owners are members and have one vote per lot. Nothing about dues, assessments, collections, fines, liens or anything related.

Covenants say nothing about assessments. Articles state there are two levels of members -- dues-paying and non-dues paying. Pic-nic grounds get mowed, weeds sprayed, insurance is paid. No lights, water, road maintenance, trash - none of that. We've existed over 40 years and never ran short of funds. Some prefer not having fines and liens a possibility. I guess you would say we operate on donations or contributions and it works very well.

Covenants say nothing about assessments. Articles state there are two levels of members -- dues-paying and non-dues paying. Pic-nic grounds get mowed, weeds sprayed, insurance is paid. No lights, water, road maintenance, trash - none of that. We've existed over 40 years and never ran short of funds. Some prefer not having fines and liens a possibility. I guess you would say we operate on donations or contributions and it works very well.

We have worked on changes to the documents. We'll see if the community votes for them. We just have a handful of people who want dues to be mandatory and want us to have an HOA lawyer. We told them they need to change the covenants and that they should begin that process if it is so important to them. They believe CCIOA makes our dues mandatory and they are being very unpleasant. We are caught up in something the legislature has done that just shouldn't apply to such a small pre-CCIOA HOA. It just may end up costing us a lot of money.

Colorado's CIOA is based on the Uniform Common Interest Ownership Act and is thus similar to Connecticut's CIOA with which I am familiar. Upon checking the CCIOA I did discover that the provisions are pretty much identical to Connecticut's statute, although the sections may be arranged differently.

Connecticut's CIOA states:

"(b) Except for assessments under subsections (c), (d) and (e) of this section, or as otherwise provided in this chapter, all common expenses shall be assessed against all the units in accordance with the allocations set forth in the declaration pursuant to subsections (a) and (b) of section 47-226. The association may charge interest on any past due assessment or portion thereof at the rate established by the association, not exceeding eighteen per cent per year."

Thus, it appears that assessments are determined by the declaration.

However, Section 47-226(a) states: "(a) The declaration shall allocate to each unit: (1) In a condominium, a fraction or percentage of undivided interests in the common elements and in the common expenses of the association, and a portion of the votes in the association; (2) in a cooperative, an ownership interest in the association, a fraction or percentage of the common expenses of the association, and a portion of the votes in the association; and (3) in a planned community, a fraction or percentage of the common expenses of the association, and a portion of the votes in the association."

I'm not sure how to interpret this provision. I'm not a lawyer, but my opinion is that in the end, assessments are still as set forth in the declaration.

As to whether the CCIOA affects communities already in existence, the statute also contains a section that states the applicability of the statute to existing communities.

Then, there is Section 10 of Article I of the U.S. Constitution which prohibits states from passing laws that impair contracts. Courts have sometimes held that laws cannot be applied retroactively to existing contracts, but only to actions going forward from when the law was passed. Of course, pursuing this angle would require a court decision.

Finally, sit four lawyers in a room and ask a question so that all lawyers hear the same thing. You might get four different answers. This is why we need courts to sort things out. Even then, there are appeals.

It never ends (or at least, it takes a lot of time and costs a lot of money).

Your Covenants do not allow for charging assessments so your association is volunary rather than manditory. There is a difference between dues, which are paid by a person, and assessments, which are against the property. You have two classes of members, those who pay dues and can serve on the Board and those who are nonpaying members (possibly without the right to vote as well as not allowed to serve on the Board). To charge an assessment to all homeowners would require an amendment to the Declaration and would change from voluntary HOA dues to a manditory assessment of each unit(lot). We currently manage an HOA which is in the process of changing from voluntary to manditory. This is in their approved and filed amended and restated Covenants and occurs upon the sale of each individual property.

I appreciate the input. We'll muddle along, but I believe this law is social security for lawyers.

Connie

I share your instincts, and I say if you can remain "off the grid" so to speak, carry on for as long as you can.
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Good luck.

I guess I should ask if there are other associations out there who also prefer staying away from CCIOA or it's equivalent. We want voluntary dues, we don't want to fine or lien our neighbors and we don't want to "need" a lawyer on a regular basis. Since we have such a small budget (under $5,000 per year) and have a membership of only 120 we feel we should police ourselves and so far that is working quite well.

True, but it would be truly wonderful if things were clear enough for us, as a pre CCIOA association, to know for sure if we fall under this law without paying a lawyer for an opinion. Right now we could pay and get one lawyer to say we do not néed to abide by it and another might say we do. So until we are sued and a judge makes a decision, we really dont't know. Therefore, I believe this law is social security for lawyers.