Prior to taking enforcement actions to recover money owed to a unit owners' association (HOA) and related collection costs or attorney fees through the foreclosure of an association lien, the act requires the HOA to be in compliance with HOA lien or foreclosure laws (lien or foreclosure laws) and applicable lien or foreclosure provisions of the HOA's declaration, bylaws, articles, and rules and regulations (governing documents). If the HOA is not in compliance with the lien or foreclosure laws or the governing documents, the court may stay the foreclosure proceedings to grant the HOA reasonable time to come into compliance and shall consider the effect of the HOA's noncompliance if awarding the HOA attorney fees.

For purposes of sending notices to unit owners relating to delinquent assessments or foreclosure actions, the HOA shall periodically request from a unit owner or the unit owner's designated contact an email address, a telephone number, and a cellular number for texts.

An HOA's written policy concerning the collection of unpaid assessments must require the notice of deficiency that the HOA sends to a unit owner to include the following:

• An advisement that the unit owner may request a copy of the HOA's ledger verifying the amount owed, which copy of the ledger shall be sent to the unit owner no later than 7 business days after the request;
• An advisement that failure to pay a delinquent assessment could result in the HOA filing a lien and instituting foreclosure of the lien (foreclosure action) and that a foreclosure action could result in the sale of the unit at auction and the unit owner losing some or all of the unit owner's equity in the unit; and
• An advisement that free information relating to the HOA's collection of assessments and the HOA's ability to file a foreclosure action and a link to credit counseling information is available online through the HOA information and resource center (recourse center).

At least 30 days prior to initiating a foreclosure action, the HOA must send notice of the HOA's intent to foreclose the association lien, including notice that the foreclosure of the lien will result in the sale of the unit at auction, which could result in the unit owner losing all or some equity in the unit; the unit owner may obtain credit counseling prior to foreclosure; and free online information relating to foreclosure by an HOA is available through the resource center.

No later than 5 business days after the HOA initiates legal action to foreclose a lien and sell a unit at auction, the HOA shall provide the unit owner with notice that the unit owner has a right to cure the delinquency and to file a motion with the court to stay the sale of the property at auction.

At any time after an HOA files an action for foreclosure of the HOA's lien on a unit, but prior to the date of auction, the unit owner may file a motion with the court to stay the auction of the unit to allow the unit owner to list the unit for sale at fair market value or at an alternate amount determined by the court. The court's order is in effect for 9 months after the date of the order. The court may extend the 9-month stay for good cause or upon proof that the sale of the unit is imminent. Proceeds from the sale will be held in escrow for the court to determine the distribution of the sale proceeds.

As part of an HOA's annual registration (annual registration) with the director of the division of real estate in the department of regulatory agencies (director), an HOA shall submit the following information, which aggregated data must be included in the resource center's annual report:

• The number of unit owners 6 or more months delinquent in the payment of assessments during the preceding 12 month period;
• The number of judgments obtained against unit owners;
• The number of payment plans entered into with unit owners; and
• The number of foreclosure actions filed by the HOA and other information requested by the director.
  (Note: This summary applies to this bill as enacted.)

Fiscal Note

The act amends the statutes that require a person to possess a permit in order to boot a vehicle to apply any application, without the appropriate consent, of a device intended to prevent the normal operation of a motor vehicle.

The act allows the public utilities commission (commission) to suspend, revoke, or refuse to renew a permit to immobilize a vehicle for felonies and immobilization-related offenses. An applicant must disclose each person that is an owner, a principal, an officer, a member, a partner, or a director of the vehicle immobilization company (company) in an application. The commission is authorized to deny an application for or suspend, revoke, or refuse to renew a permit of a company based on a determination that it is not in the public interest for the company to possess a permit. The determination is subject to appeal. Possession of a permit is rebuttably presumed to be not in the public interest if a company has willfully and repeatedly failed to comply with the relevant law.

The act adds the following new duties for companies:

• Before immobilizing a vehicle, the company must document the vehicle's condition and the reason for the immobilization. Standards are set for the documentation, including taking photographs.
• Upon demand by an authorized or interested person, the company must provide copies of the photographs, and if the company does not provide the photographs and a vehicle is damaged, it creates a rebuttable presumption that the company damaged the vehicle or did not have authority to immobilize the vehicle;
• A company shall display its name, the permit number, and a phone number of the company on each company vehicle used in immobilization. Standards are set for the display.
• The representative of a company must have business identification visibly worn at all times while immobilizing a vehicle or accepting payment;
• If a vehicle has been immobilized by a company, another company must not immobilize the vehicle;
• If a company applies more than one immobilization device to a vehicle, the company may not charge more than once for the removal of all the immobilization devices;
• A company must provide, upon request, evidence of the company's commercial liability insurance coverage;
• A company must immediately accept payment and release the vehicle if offered in cash or by valid major credit card;
• Upon request, a company must disclose accepted forms of payment;
• A company must provide an itemized act showing each charge and the rate for each fee incurred as a result of an immobilization and any fee that caused the immobilization; and
• A company may not pay money or provide other valuable consideration for the privilege of immobilizing vehicles.

A company is prohibited from immobilizing a vehicle on private property unless:

• The immobilization is ordered or authorized by a court order, an administrative order, or a peace officer or by operation of law; or
• The company has received permission for each individual immobilization, within the 24 hours immediately preceding the immobilization, from a specified person. The company must retain the permission for 3 years.

A property owner with tenants must give each tenant adequate notice of parking regulations as outlined in the act. A company may not immobilize a vehicle in a parking space or common parking area without the company or property owner giving 24 hours' written notice at least 24 hours before immobilizing the vehicle, unless the vehicle owner or operator has received a previous notice for parking inappropriately in the same manner. Standards are set for the notice.

The company or property owner need not give the notice if one of the following apply but must place a notice on the immobilized vehicle that contains the phone number of the company, the normal operating hours of the company, and the phone number to contact the company outside of normal operating hours if:

• The vehicle is parked a second or subsequent time in the same inappropriate manner;
• The vehicle is parked in a designated and marked fire zone or is effectively obstructing a fire hydrant;
• The vehicle is inappropriately using reserved parking for people with disabilities;
• The immobilization is ordered or authorized by a court order, an administrative order, or a peace officer or by operation of law;
• The vehicle blocks a driveway or roadway enough to effectively obstruct a person's access to the driveway or roadway;
• The vehicle is parked in a designated, rented, or purchased parking space of a resident; or
• The vehicle is parked in a parking lot marked for the exclusive use of residents.

To immobilize a vehicle on private property normally used for parking, the following must be provided upon entering the private property:

• Notice of the parking regulations; and
• Notice that a violation of the regulations subjects the vehicle to immobilization at the vehicle owner's expense.

Unless the immobilization is based on an order given by a peace officer, a company may not immobilize a vehicle on private property because the vehicle's registration has expired.

For a company to immobilize a vehicle, the property owner must have posted signage that meets the size, visibility, and placement standards of the act and contains the following information:

• The restriction or prohibition on parking;
• The times of the day and days that the restriction is applicable, but, if the restriction applies 24 hours per day, 7 days per week, the sign must say "Authorized Parking Only";
• Notice that violating the regulation subjects the violating vehicle to be immobilized at the vehicle owner's expense; and
• The name and telephone number of the company authorized to perform immobilization on the private property.

A company may not patrol or monitor property to enforce parking restrictions on behalf of a property owner. A company may not immobilize a vehicle because the vehicle is inoperable if the vehicle is owned by a resident and is parked in the resident's designated, rented, or purchased parking space or driveway or in a mobile home lot that is leased or owned by the resident.

If a company has immobilized a vehicle on private property, the company must give a written notice of the person's ability to make a complaint to the commission in accordance with the standards of the act.

A company must release a motor vehicle either within 120 minutes after being contacted outside the company's normal business hours or within 90 minutes during the company's normal business hours. A company must immediately release a vehicle without charge to a towing carrier when evidence is presented that the towing carrier has authorization to conduct a nonconsensual tow or law-enforcement-directed tow. A company must immediately release an immobilized vehicle if the person retrieving the vehicle pays $60 and the person signs a form affirming that the authorized or interested person owes the company payment for the appropriate fees. A company may remotely release an immobilization device from a vehicle. The company shall retrieve the immobilization device within 120 minutes after releasing it. The driver must move the immobilization device from the road so that it is not a hazard to vehicles or pedestrians unless the driver has a physical limitation that makes moving the device unreasonably difficult or impossible. The driver need not return the device to the company or a location specified by the company.

A company must charge a reduced release charge set by the commission and immediately release the vehicle if the vehicle is released after an employee of or agent of the company starts to immobilize the vehicle but before the agent or employee leaves the private property.

A company must retain evidence of giving the notices and disclosures required in the act for 3 years and provide the evidence to the commission or an enforcement official upon request.

Generally, the act does not apply to an immobilization that is:

• Ordered by a peace officer or technician directed by a peace officer;
• In a parking space that serves a business if the parking space is on commercial real estate;
• Ordered by a municipality, county, or city and county; or
• On federally leased land used for commercial parking purposes.

A violation of the act is generally a deceptive trade practice and is subject to enforcement by the attorney general's office or a district attorney.

(Note: This summary applies to this bill as enacted.)

Fiscal Note

Under current law, common interest communities are encouraged to use mediation prior to filing a complaint with the court. The bill requires permits a dispute between a unit owner and a unit owners' association to go through an internal dispute resolution process participate in an informal negotiation and mediation to resolve the dispute before the parties can file a complaint with the court. If the parties are unable to reach a mediation agreement, the bill allows the parties to undergo arbitration or commence a legal proceeding. If the parties are unable to reach an agreement during the informal negotiation, either party may file a complaint with the court and the court must order the parties to participate in mediation, if mediation has not already taken place.

(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)

(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

Fiscal Note

In an action against a construction professional, section 2 of the bill requires the construction professional to provide the claimant or the claimant's legal representative with:

• Copies of all plans, specifications, soils reports, and available engineering calculations;
• Any maintenance and preventive maintenance recommendations;
• The name, last-known address, and scope of work of each construction professional that performed work or services; and
• Copies of all insurance policies held by the construction professional during the appropriate time.

The construction professional may charge reasonable copying costs for the documents. Failure to provide the identifying information of the other construction professionals bars the construction professional from designating the unidentified construction professionals as nonparties at fault in any subsequent action.

Section 3 requires a court to award prejudgement interest of 8% to a prevailing claimant who alleges defects in a residential property construction. Section 5 voids a provision in a real estate contract that:

• Prohibits group lawsuits against a construction professional; or
• Imposes different or additional requirements than the statutory requirements to bring or join a legal action.

Section 6 changes the time when a claim of relief arises, for the purposes of the statute of limitation and repose, to include both the discovery of the physical manifestation and the cause of the defect.

Current law authorizes, subject to the requirements of the common interest community's (community) declarations, a community to engage in certain actions, such as instituting, defending, or intervening in litigation or administrative proceedings on matters affecting the community. Section 7 exempts an association's authority to institute, defend, or intervene in litigation proceedings concerning construction defects from the requirement that the action be subject to the declaration. Section 8 requires the department of regulatory agencies to include in its "SMART Act" report information concerning construction liability insurance and the basis for rates.
(Note: This summary applies to this bill as introduced.)

Fiscal Note

For construction of multifamily, attached housing of 2 or more units, the act creates the multifamily construction incentive program (program). A builder may chose to participate in the program by:

• Providing a warranty that covers any defect and damage at no cost to the homeowner for specified periods;
• Having a third-party inspection performed on the property; and
• Recording a notice of election to participate in the program in the real property records before the property is offered for sale.

For construction defect claims brought for the construction of housing for which the builder is a participant in the program, the act:

• Requires a claimant to file a certificate of review with the complaint, if the complaint is against an architect or engineer;
• Limits actions to claims that have resulted in: Actual damage to real or personal property; actual loss of the use of real or personal property; actual bodily injury or wrongful death; an unreasonable reduction in the capability of, or an actual failure of, a building component to perform an intended function or purpose; or an unreasonable risk of bodily injury or death to, or a threat to the life, health, or safety of, the occupants of the residential property; and
• Requires that a construction professional must send or deliver to the claimant an offer to settle the claim or a written response that identifies the standards that apply to the claim and explains why the defect does not require repair.

For all construction defect claims, the act:

• Establishes a claimant's duty to mitigate an alleged construction defect and specifies how a claimant may satisfy this duty and the consequences to a claimant that fails to satisfy this duty;
• Requires a construction professional who is the defendant in a construction defect action to submit specified information to the claimant;
• Prohibits an insurer from cancelling, denying, or reducing coverage based on any claim for benefits covered by an existing liability insurance policy issued to a construction professional based on the construction professional's offer to repair or settle a construction defect claim;
• Tolls the statute of limitations or repose during a claimant's mitigation of an alleged construction defect;
• Increases the percentage of owners that an executive board of a unit owners' association (executive board) must obtain approval from before initiating a construction defect claim on behalf of the owners from a majority to 65%; and
• Requires an executive board that is successful in a construction defect claim or settlement to first use the net monetary damages or net proceeds received as a result of the claim to repair the construction defect.

The act requires a local government to establish a fast-track approval process for an application for for-sale multifamily condominium projects in order to qualify for assistance from the state affordable housing fund.

(Note: This summary applies to this bill as enacted.)

Fiscal Note

The bill creates 2 enterprises in the division of insurance (division) in the department of regulatory agencies.

The bill creates the strengthen Colorado homes enterprise (strengthen homes enterprise), which is a state-owned business that imposes and collects a fee from insurance companies (insurers), including the FAIR plan association, that offer on policyholders of homeowner's insurance policies issued by insurance companies (insurers) and the fair access to insurance requirements (FAIR) plan association in the admitted market covering property located in or risks in Colorado. which The fee is collected on a per-policy basis and is equal to 1.5% of one-half percent on the dollar amount percentage of the total premiums that the insurer collects in the immediately preceding calendar year from homeowners for issuing homeowner's insurance policies ( insurer fee); except that an insurer shall not collect the fee on policyholders that have resilient roof systems.

With the insurer fee revenue, the strengthen homes enterprise board administers a grant program (grant program) to strengthen homes against the risk of future damage claims caused by high winds, wildfire, hail, and other extreme weather events (extreme weather events) by allowing a homeowner to use grant money to upgrade their roof system with certain resilient roof materials. By paying the insurer fee to support the grant program to retrofit homes with resilient roofs, policyholders may defray the cost of retrofitting their property to resist losses due to common perils, including windstorms, wildfire, and other extreme weather events, and insurers reduce their overall risk in the market due to hail and other extreme weather events, in order to promote insurance market stability throughout the state.

The bill also creates the wildfire catastrophe reinsurance enterprise (reinsurance enterprise), which is a state-owned business implementing and administering the wildfire catastrophe reinsurance program (reinsurance program). The reinsurance program makes reinsurance payments to insurers that offer homeowner's insurance on properties located in the state to partially mitigate losses in the event of a state or federally declared wildfire-related disaster (wildfire-related disaster). The purpose of the reinsurance program is to stabilize the homeowner's insurance market in the state and to attract and retain homeowner's insurers. In exchange for access to the reinsurance program, the reinsurance program requires insurers to sell homeowner's insurance in areas of the state that are at high risk for wildfires.

To pay for the reinsurance program, the reinsurance enterprise:

• Issues revenue bonds secured by the reinsurance enterprise;
• Issues a catastrophe bond to a person that purchases the bond but pays the principal to cover costs of a wildfire-related disaster if it occurs;
• May impose and collect an insurer fee on insurers to cover a shortfall if a wildfire-related disaster does not occur during the bond term and the reinsurance enterprise has insufficient money to redeem the bonds at maturity; and
• Beginning in the 2026 calendar year, impose and collect a fee on a per-policy basis on each policyholder of a homeowner's insurance policy issued in the admitted market covering property in or risks in the state. The amount of the fee is equal to one-half percent on the percentage of total premiums collected by each insurer in the immediately preceding calendar year.
• Invests the revenue from the revenue bonds and insurer fees.

In addition, the bill sets the loss ratio for homeowner's insurance by presuming that the rates charged to purchasers are excessive if the insurer's loss ratio is less than 75% over a 3-year period and, if rates are in excess of the loss ratio, requires insurers in the admitted market participating in the reinsurance program to submit rates that are at least 5% less than the previous year one set of rates taking into consideration the reinsurance program and one set without. In addition to offering a replacement-cost policy in accordance with current law, an insurer may offer a replacement-cost policy that has a reasonable coverage limit or percentage cap for additional living expenses if the insurer provides a premium decrease for the coverage limit or replacement cap that is approved by the division.

For the 2025-26 state fiscal year, the bill appropriates $7,410,037 to the department of regulatory agencies from the strengthen homes enterprise and also appropriates money to the department of law for legal services to implement the reinsurance program.

(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)

(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

Fiscal Note

Current law restricts construction defect negligence claims unless the negligence claim arises from a construction defect which results in actual damage to or loss of the use of real or personal property; bodily injury or wrongful death; or a risk of bodily injury or death to, or a threat to the life, health, or safety of, the occupants of the residential real property. Section 1 of the bill changes this restriction so that all construction defect claims are restricted unless the claim arises from a construction defect that causes:

• Actual damage to real or personal property caused by the violation of a building code, manufacturer's instructions, or industry standard;
• Actual loss of the use of real or personal property;
• Bodily injury or wrongful death; or
• An imminent and unreasonable risk of bodily injury or death to, or an imminent or unreasonable threat to the life, health, or safety of, the occupants of the residential real property.

Sections 2 through 12 modify existing warranty of habitability laws by repealing recent updates and reenacting the laws as they were prior to the updates. The modifications include repealing certain procedures for both landlords and tenants when a warranty of habitability claim is alleged by the tenant; repealing a rebuttable presumption that a landlord failed to remedy an uninhabitable premises in certain conditions; modifying requirements regarding notice given to a landlord of an uninhabitable premises; and modifying other laws related to rental agreements, records, and procedures for remedying uninhabitable premises. Section 13 repeals law that allows the attorney general to independently initiate and bring actions to enforce laws relating to the warranty of habitability. Section 14 makes a conforming change to law governing county courts' jurisdiction over cases involving tenant's remedies in warranty of habitability cases and tenant's remedies in cases of unlawful removal. Section 15 modifies the statement included in a summons issued to a defendant in a court proceeding regarding an action for possession brought by a landlord. Sections 16 through 20 repeal provisions related to evictions of residential tenants, including repealing:

• Requirements that a landlord and residential tenant participate in mandatory mediation prior to commencing an eviction action if the residential tenant receives cash assistance;
• A prohibition on a law enforcement officer's ability to execute a writ of restitution until 30 days after the entry of judgment if the residential tenant receives cash assistance;
• Requirements that a written demand include a statement that a residential tenant who receives cash assistance has a right to mediation prior to the landlord filing an eviction complaint;
• Requirements that a written rental agreement include a statement that current law prohibits source of income discrimination and requires a nonexempt landlord to accept any lawful and verifiable source of money paid directly, indirectly, or on behalf of a person; and
• Requirements that prohibit a written rental agreement from including a waiver of mandatory mediation or a clause that allows a landlord to recoup any costs associated with mandatory mediation.

Sections 21 and 22 require any provision of any energy code adopted by a county or municipality on or after January 1, 2026, to be cost effective. "Cost effective" means, using the existing energy efficiency standards and requirements as a base of comparison, that the economic benefits of the proposed energy efficiency standards and requirements will exceed the economic costs of those standards and requirements based upon an incremental multi-year analysis.
(Note: This summary applies to this bill as introduced.)

Fiscal Note

The act implements the recommendations of the department of regulatory agencies (department) in its sunset review and report on the HOA information and resource center (center). The center was scheduled to repeal on September 1, 2025.

The act:

• Continues the center until September 1, 2030;
• Clarifies that the director of the division of real estate in the department is the appointing authority for the HOA information officer who is the head of the center; and
• Makes a technical change to refer to the HOA information officer by title, rather than by "he or she", to reflect gender-neutral language in statute.
  (Note: This summary applies to this bill as enacted.)

Fiscal Note

The bill clarifies that construction professionals owe an independent tort duty of care to construct residential homes in a non-defective and reasonable manner, and that this duty is owed equally to original and subsequent residential home purchasers.

(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

Fiscal Note