HB22-1137 rewrote C.R.S. § 38-33.3-209.5, capping most covenant fines at $500, requiring two consecutive 30-day cure periods (or 72 hours for safety threats) before legal action, mandating notice and a hearing, and barring associations from charging fines on a daily basis or foreclosing for fines alone.
C.R.S. § 38-33.3-209.5(1.7) governs fines. For a violation that is not a public-safety/health threat, the association must send certified-mail notice giving the owner 'thirty days to cure the violation,' and 'the total amount of fines imposed for the violation may not exceed five hundred dollars.' The owner must be granted 'two consecutive thirty-day periods to cure' before any legal action. Safety/health threats get a 72-hour cure before fines. An association 'shall not impose ... on a daily basis' late fees or fines. It may not fine at all unless it follows a written fine policy with 'notice and an opportunity to be heard before an impartial decision maker' (§ 209.5(2)). Critically, fines, fees, and charges are subject to a statutory lien but 'are not subject to a foreclosure action' (§ 316(1)(a)).
Fines are capped at $500 per non-safety violation and may not be levied daily. If the association ignores the fact-finding outcome and the owner is found not responsible, it may not charge the owner its costs or attorney fees. Associations cannot foreclose based on unpaid fines.
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