Selling Your Home

March 9, 2006
 
Denver office David A. Closson, Esq.

Lone Tree Homeowner's Associationc/o Board of Directors8471 Sweet Water Road

Lone Tree, CO 80124

Re: Applicability of CCIOA and SB-100

Our File No. 9912.001

Dear Members of the Board: The Board has requested HindmanSanchez P.C. to provide a letter regarding the applicability of specific Colorado laws as they may pertain to the Lone Tree Homeowner's Association. The Colorado Common Interest Ownership Act ("CCIOA") governs the formation, management, and operation of most Colorado associations and common interest communities ("CIC"). Senate Bill 100 ("SB 100") is a new law that not only amends several existing provisions of CCIOA, but it also adds entirely new sections for board members to master. Associations subject to CCIOA are required to come into compliance with the provisions of SB 100 effective January 1, 2006.

However, CCIOA and SB100 do not apply, in any respect, to voluntary associations in communities that do not fall within the definition of a CIC. Therefore, it is important to understand whether or not your community qualifies as a CIC under Colorado law. As CIC is defined by Colorado law to include "Real estate described in a declaration with respect to which a person, by virtue of such person's ownership of a unit, is obligated to pay for real estate taxes, insurance premiums, maintenance, or improvement of other real estate described in a declaration". Put another way, regardless of whether an association has common areas or common elements, if the payment of association assessments is not mandatory, the community does not fall within the definition of a CIC and neither CCIOA or SB 100 apply to the association.

Therefore, since members of the Lone Tree Homeowner's Association are not required to pay assessments, under Colorado law the Lone Tree Homeowner's Association is not a CIC and the association is not subject to the provisions of CCIOA or SB 100.

Please feel free to contact the LTHOA if you have any further questions.

Sincerely,


David A. Closson, Esq.
HindmanSanchez P.C.

DAC/cnhc: Elina B. Hindley, Esq.

5202788

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