Colorado lawmakers gear up for construction-defects reform in 2015
Supporters of a change to a Colorado law blamed for slowing condominium construction to a trickle are hopeful 2015 will be the year they succeed.
Lawmakers have tried for the past two years to reform Colorado’s construction-defects law, which developers complain makes building condos too fraught with legal liability.
Both times, the legislature came up empty.
But that could change in the new legislative session, which begins Wednesday. Supporters of reforming Colorado’s law say a new Lakewood ordinance, designed to spur condo building in that city, is apt to serve as the impetus for passing a bill, as other cities eye similar ordinances.
“A patchwork around the state on this issue is not the way to go,” said Rep. Brian DelGrosso, R-Loveland, who was part of the reform effort in the last session. “Hopefully, the Lakewood measure will spur the conversation this year.”
According to the market research firm Metrostudy, condos accounted for more than 20 percent of all housing starts — or more than 4,000 units — in late 2005 but only 3 percent through the first three quarters of 2014.
Just last month, Denver Mayor Michael Hancock said reforming the law was his top legislative priority.
“Right to repair”A key concern for builders is that Colorado law lets the majority of a homeowners association board, rather than a majority of the homeowners, decide whether to sue over construction defects. The law also allows home owners to reject a fix offered by a builder even before the builder does the work.
Builders say the law is particularly troublesome for condos because so many home owners live under one roof, complicating legal action.
In October, Lakewood took matters into its own hands by passing an ordinance making it tougher for homeowners living in multi-family developments to sue over defects, like leaky windows, cracked concrete and bad drainage.
The city’s measure gives builders a “right to repair” faulty work before facing legal action and requires that a majority of home owners approve legal action before it is taken.
Nancy Stockton, president of the homeowners association at the Vallagio at Inverness in Arapahoe County, said following Lakewood’s example statewide would only make it that much harder to hold builders accountable for the quality of their work.
“I think it would be a license for builders to cut corners and be even more lax in their construction,” said Stockton, whose community is in litigation over alleged defects. “The dispute process is already onerous.”