By Alyssa Chirlin, Smith Jadin Johnson, PLLC

HB25-1272: this bill does a number of things including imposing a six-year deadline (statute of limitation) on Construction Defect actions and setting forth Affirmative Defenses that a Construction Professional may raise against a claim, including that the defect was caused by weather, failure to follow maintenance recommendations, human-caused event (such as vandalism) or ordinary wear and tear. It also increases the owner voting threshold to pursue a construction defect claim from a simple majority to a 65% vote.

Community associations often call attorneys when something has already gone wrong—a foreclosure is stalled by a procedural technicality, or an insurance claim is denied due to a documentation gap. In practice, though, the strongest legal position is built well before any dispute arises. It starts with preparation, clarity, and diligence. 

As we head into 2026, Colorado community associations are operating in a changed legal environment. Recent legislation has raised the bar for compliance in several critical areas, including LIST. “Strict compliance” is, in many cases, no longer simply a best practice; it is the baseline requirement for enforcing a community’s rights. With new laws reshaping foreclosure procedures and construction defect claims, the early part of the year is the ideal time for boards to take stock and strengthen their foundations. 

To that end, here is a practical 12-week plan designed to move your association from reactive problem-solving to proactive risk management. 

THE 12-WEEK ROADMAP FOR A STRONGER 2026

Weeks 1–4: Collections & Foreclosure Readiness 

Focus: Perfecting procedures to protect an association’s lien rights.

House Bill 25-1043 introduced new "Owner Equity Protection" regulations that alter assessment collections and foreclosure. Collections notices must now include more detailed information about a delinquent owners’ rights, the collections process includes more steps, and, once the foreclosure process has begun, delinquent owners have a greater ability to pause foreclosure proceedings if an association cannot demonstrate strict compliance with every statutory requirement. 

Key steps for boards to take: 

• Review your collections policy: Your policy is your first line of defense and must clearly reference required disclosures, including notice of delinquent owners’ ability to access relevant information from the HOA Information and Resource Center and HUD Without this specific language, collections actions may be vulnerable to delay or dismissal, and your community may even be responsible for paying the delinquent owners’ attorney fees. 

• Treat collections notices as evidence: Notices of delinquency should be drafted with care. Ensure that they contain the newly-required statutory language, including notice to delinquent owners of their right to receive an account ledger within seven (7) business days and of the potential risk to their home equity. 

• Confirm compliance before escalation. Before authorizing legal action, associations should verify that all steps required by law and by the association’s governing documents were completed, including communication and voting requirements. Establishing a procedure to verify compliance will save time and put the association in the best position to succeed on its legal claims.

• Re-evaluating insurance obligations. Many governing documents assign insurance responsibilities that no longer align with today’s coverage realities. Where the law allows, boards should consider whether the current allocation of insurance duties between the association and owners still makes sense or whether updating those provisions could reduce financial obligations, clarify expectations, and better protect all parties.

• Governing document cleanup: While a governing document amendment is not always necessary, outdated or conflicting provisions should be addressed at least through a rule or policy, where possible.  Items to review include fine limits, enforcement language, and other rules affected by newer statutes, such as flag and sign limitations. Conflicting documents create confusion and ambiguity, and in court, these can be expensive.

• Re-evaluating insurance obligations. Many governing documents assign insurance responsibilities that no longer align with today’s coverage realities. Where the law allows, boards should consider whether the current allocation of insurance duties between the association and owners still makes sense—or whether updating those provisions could reduce disputes, clarify expectations, and better protect all parties.

• Deductible transparency: If your master policy deductible has increased, homeowners may be exposed without realizing it. Associations should clearly communicate specific deductible amounts so homeowners can confirm that their personal HO-6 policies provide adequate coverage.

• Plan for slower recovery timelines: Under HB25-1043, homeowners may request a stay of foreclosure for a period of up to nine months (which may then be extended even further for good cause) in order to sell their home at fair market value. While this protects a homeowner’s equity, it also means associations should budget for longer collection cycles. 

• Understand new construction defect requirements: HB25-1272 has raised the homeowner approval threshold for construction defect lawsuits from a simple majority to 65% of all homeowners.  For newer communities approaching statutory deadlines, early education and outreach are essential. Achieving this high level of support requires more than a single notice—it calls for a thoughtful communication strategy.

1. Commit to strict compliance. In today’s legal environment, “almost right” is no longer good enough. One missed step can halt enforcement efforts.

1. Budget for delays in collections. New foreclosure stays mean recovery may take longer. Cash-flow planning is more important than ever.

1. Update owner contact information. Laws now require the use of multiple communication methods. Without current email addresses and cell numbers, enforcement options may be limited.

1. Assess the 65% vote threshold. Communities with potential construction issues should gauge owner sentiment early and plan well ahead of any deadlines.

1. Communicate insurance deductibles clearly. Make sure owners know exactly what your association’s deductible is so they can coordinate their personal coverage accordingly.

Weeks 5–8: Risk Management and Insurance Check-In

Focus: Closing coverage gaps before a loss occurs.

Insurance challenges continue to grow as premiums rise and coverage terms tighten. While some disputes stem from carriers’ bad faith, disputes can also stem from misalignment between governing documents, insurance policies, and homeowner expectations. 

Board should focus on:

Weeks 9–12: Litigation Strategy in a New Legal Landscape

Focus: Planning for longer litigation timelines and higher thresholds.

Recent legislative changes have altered expectations around both collections and litigation. Including: 

A little planning at the start of the year can prevent significant frustration—and expense—down the road. By taking a structured, proactive approach in early 2026, Colorado HOAs can protect their communities, strengthen their financial footing, and reduce the likelihood of unpleasant surprises later on.

Manager’s Tear-Sheet: Summary for Boards

(Cut and paste this section for your Board packets)

If You Only Do 5 Things This Year…

Alyssa Chirlin a partner at Smith Jadin Johnson, PLLC, which focuses on representing community associations in Colorado. The firm provides comprehensive legal services to HOAs, including routine governance, collections, covenant enforcement, developer transition, litigation and general counsel support.