Colorado Legislative Action Committee (CLAC)

Minutes-January 29, 2010

Denver Chamber of Commerce

1445 Market Street, Denver, CO

Call to order – 1:35 PM-Vice-Chair Jerry Orten

Attendance-Members/Delegates:

Guests:

Call to order:  Vice-Chair Jerry Orten called the meeting to order at 1:35 PM and asked if any member had a conflict of interest with items on the agenda, or in general regarding the other business of the LAC, which he or she needs to disclose.  There were no such disclosures.

Introductions: Participants introduced themselves.

Resignation: Jerry announced that Deb Karpuk had resigned from CLAC.  

ITEMS OF BUSINESS:  Several items as enumerated on the agenda were discussed:

Lobbyist report: Amy Redfern and Chris Pacetti rendered this report.  Amy indicated that the environment at the capitol was ‘acrimonious’ and tense due to the difficulties surrounding the (a) budget shortfall, (b) the fact that this is an election year and the related politics and (c) the upheaval in the Governor’s office.  Amy distributed copies of the Legislative Matrix.  Several bills were discussed at greater length (CLAC members had been asked to be prepared) and positions were taken:

SB 77:-Regulation of Appraisal Management Companies:  Discussion ensued surrounding whether there was impact to CLAC’s constituency.  The conclusion and CLAC position was to remove the bill from the watch list.

HB 1084: Good Samaritan legislation-Rep Acree/Sen Mitchell:   This is the bill that was discussed last year and it is making a re-appearance this year.  It was indicated that a hearing, for discussion only had taken place on 1/28/10 with several groups opposed to the bill. Concerns were expressed over the need for clear immunity for HOA’s involved in such efforts and it was felt that if clear immunity could be granted to HOA’s we could support this bill.  An envoy group of Suzanne Leff, Andrea Bobb, Molly Foley-Healy and Pat Wilderotter was designated on this bill.

HB 1093:-Real Property Valuation-Bradford/Harvey: There was brief discussion as to whether this bill significantly impacted HOA’s. CLAC’s position was to remove from the watch list.

HB 1118: -County Commissioners regulation of distressed property-J Kerr/Hudak:  There was brief discussion on any potential impacts to HOA’s and the desirability of the Counties contacting the HOA’s. The CLAC position was to monitor the bill.

HB 1133:-Remove Foreclosure consultant-Massey: The bill was briefly discussed and its definition of an ‘equity purchaser’.  The CLAC position was to monitor the bill and Walt Lukasik agreed to be the monitoring person.

HB 1158:-Clarify Wind Rights-Gardner/Hodge: As introduced, the bill essentially treats wind in a similar manner to mineral rights.  After discussion, CLAC position was to monitor the bill and an envoy/monitoring person was designated as Jesse Witt.

SB 45: Homeowner Protection Act-Sen. Morse/A Kerr: There was extensive discussion over the mediation aspects of the bill and the intents of the sponsors.  There were indications that there would be additions to this bill.  The CLAC position was to closely monitor this bill and envoys Jesse Witt, Jerry Orten and Molly Foley-Healy were designated.

SB 93: Junior Liens in Foreclosure-Sen. K. Lundberg:  Senator Lundberg is pursuing ‘lien assessment’ legislation favored by the Douglas County Public Trustee.  Some discussion took place including title concerns.  The CLAC position was to closely monitor the bill and envoys Andrea Bobb, Suzanne Leff and Molly Foley-Healy were designated.

Other proposed/impending legislation/other issues:

HB 1086: A brief discussion took place on this bill and it was announced that the bill had been PI’ed on 1/28/10 by a 6-5 vote.

Possible Solar Gardens Bill-Rep. Levy/Williams:  Amy and Chris reported that they had met with Rep Levy and she was attempting to draft this bill as permissive whereupon homeowners would have another tool to battle energy issues.  She indicated she was sensitive to HOA concerns. No bill has yet been introduced.

Possible bill to limit/regulate transfer fees: Jerry Orten reported on a potential bill to limit transfer fees on the sales of a property being developed by the RE section of CO Bar.  The Bar has asked for comments by Monday 2/1/10.   Some sellers are recording covenants that require the original seller to be paid a transfer fee whenever the property is sold (in perpetuity.)  In all these cases no services are provided relative to the transfer fee.  There is some discussion as to legislation to eliminate the practice.   The Bar has indicated that it is not their intent to affect CIC’s where transfer fees are part of the sales price or community managers who charge a transfer fee for moving the records on a unit from one owner to another.  Several concerns were expressed that the proposal’s exemptions may not adequately protect HOA’s where the transfer fee is not part of the Declarations or management companies.  Although a draft exists, no bill has yet been produced. Several concerns were expressed due to the clear lack of exception for HOA’s and their management companies (particularly when the transfer fees were not founded in the Declarations.)  Jerry Orten agreed to author the comments to the Bar and distribute a draft of those comments electronically to CLAC members on Monday 2/1.

Construction defect legislation: This issue will arise again for the 2010 session.  Senator John Morse and Scott Sullan (construction defect attorney) seem to be leading the effort. These interests are carefully counting their votes in the Senate and it is clear if they do not have their 18 votes they will not attempt to run the bill.  Amy will continue to follow the bill and the details.

Super Lien/First Lien Lenders-update:  Jerry Orten provided an update on this issue.  A group of 11 CAI attorneys had met recently to discuss possible changes to the Super Lien.  Whether the other Colorado Bar facilitated group re-starts remains to be seen.  Jerry reported that a large benefit to the meetings facilitated by the CO Bar was the understanding that the participants had gained in comprehending the superlien issue and CIC’s.  The discussion on the SL is now wholly within CAI and a smaller subcommittee of 5 CAI attorneys are developing a position on proposed changes to present to all CAI attorneys sometime in late February.

Real Estate Filing Fees:  A report from Lynn Jordan on this topic and its interrelationship with HB 1007 was postponed until the next meeting.  Gary Tobey and Lynn Jordan will be monitors/envoys.

Teller County Homeowners—report:  Amy Redfern reported that there will be no attempted legislative solution to this issue this year.  An envoy group composed of Chris Pacetti, Gary Debus, Amy Redfern, Suzanne Leff and Molly Foley-Healy had previously met with Representative Carole Murray.  Representative Murray had expressed some concern particularly over some older communities in her district where infrastructure items (primarily older roads) are fully deteriorated with no funds to repair these. 

Update on Amicus brief-Fairway Pines:  Jesse Witt made a presentation regarding the CLAC participation in an amicus brief in the case of Fairway Pines Estates.  Jesse indicated that Loura Sanchez had assumed the role for HindmanSanchez due to Brian Martin leaving that firm and that the court had been petitioned for permission to file an amicus brief and that the court had granted certiorari and that the brief would likely be filed Monday 2/1/10.

Manager Licensing:  There was a brief discussion and questions asked of Amy Redfern if the recent two embezzlements involving HOA’s and management firms had prompted any calls or inquiries from legislators regarding manager licensing.  Amy indicated there had been no such calls or inquiries.  It was also discussed as indicated in two recent, distributed media stories about CPA’s and Attorney embezzlements that licensure offered no protection or assurances against embezzlement.  It was suggested by several that understanding of the intricacies and processes of these types of legislative changes might provide some better basis for manager licensing. 

State Ombudsman:  Sen. M. Carroll’s concept of an ombudsman was also discussed with the observation that the results were at best, mixed in other states.  It was noted that the HOA Council through its ‘roundtables’ attempts to fill this role on a limited basis.  It was decided not to approach Sen Carroll with any inquiry re: ombudsmen.

Administrative portion- minutes, financials:

Minutes:  It was announced that the minutes, as previously electronically transmitted for the December 3, 2009 meeting were approved by E-vote and posted on the websites & entered into the record.  Three corrections were made to these 12/3/09 minutes:

Financial reports:  Lynn Jordan indicated that the series of Emails relating to the non-filing of financial information was incorrect.  Lynn indicated she had talked by telephone with representatives of Bondi and Associates, CPA’s and she indicated there was some mis-communication due to multiple parties being involved at the CPA firm.  She indicated that Bondi had all the CLAC information that they needed, she gave assurances that everything was proper and that all future communications would be directly from Bondi solely to her.   Lynn also presented a statement of revenues and expenses for CLAC for the period 10/1/09-12/31/09.  She indicated that the advocacy fees were low but didn’t know exactly why.  Lynn also indicated that several amounts had come in since 1/1/10.  The Rocky Mountain Chapter asked that Lynn invoice them regularly for their periodic contributions to CLAC.  In response to concerns over the lack of a CLAC Balance Sheet, Lynn said she didn’t know the members wanted one and would Email a Balance Sheet to all CLAC members.  The revenue and expense statement was approved.

New business:  There was no other new business.

Next meeting:  The date and time for the next meeting will be Friday, February 19, 2010 @ 1:30 PM, 1445 Market Street, 4^th floor (Denver Chamber of Commerce suite)--(Denver Chamber of Commerce Building).

Other CLAC meetings were announced to take place during the session.

 Adjournment:  There being no further business to come before the committee, Jerry Orten adjourned the meeting at 3:19 PM, Friday, January 29, 2010.

Respectfully submitted,

J. Kevin Moore, Secretary

CLAC MEMBER/DELEGATE ATTENDANCE RECORD:

Attendance Policy:

A LAC delegate who has three consecutive unexcused absences (as determined by the LAC’s officers) from LAC meetings may be removed by a majority vote of the LAC at a meeting where a quorum is present provided the LAC chair notified the delegate and his or her chapter, if applicable, in writing following the delegates second unexcused absence that a third consecutive absence may result in the delegate’s removal.