Colorado Law · Budgets & Assessments

HOA Assessment Authority in Colorado: Budget Ratification Under § 38-33.3-303(4)

Colorado adds a step after the board adopts a proposed budget. Owners receive a summary and a meeting, and the budget is deemed approved unless a majority of all owners vetoes it. The statute requires the summary and the meeting, and the rule shapes how a Colorado board plans its budget calendar.

Educational notice. This information is educational in nature and should not be construed as legal advice. Statutory references are to the Colorado Revised Statutes as published by the Colorado General Assembly at the time of writing; later amendments are possible. Consult qualified association counsel regarding legal interpretation specific to your jurisdiction.

Currency: verified against the Colorado Revised Statutes 2024 (Office of Legislative Legal Services printout) and the enrolled bills named in the text, each with its effective date. Later amendments are possible.

The Short Version

• The board adopts a proposed budget. Within 90 days, it must mail or otherwise deliver a summary to all owners (website posting counts) and set an owners’ meeting within a reasonable time (§ 38-33.3-303(4)(a)(I)).
• Owner approval is not required unless the declaration requires it. The budget is deemed approved unless a majority of all unit owners vetoes it at that meeting, or a class majority or larger percentage if the declaration says so. A veto counts whether or not a quorum is present (§ 303(4)(a)(II)(A)).
• If owners veto it, the last budget they did not veto continues (§ 303(4)(a)(II)(A)).
• Pre-1992 communities have been subject to the budget-veto rule since July 1, 2017 (§ 38-33.3-117(1.8)). There is an exception for some declarations that cap assessments (§ 303(4)(a)(II)(B)).
• Assessments are made at least annually, based on a budget adopted at least annually. Interest on past-due assessments may not exceed 8% per year (§ 38-33.3-315(1)–(2)).

Where Colorado Assessment Authority Comes From

The Colorado Common Interest Ownership Act (CCIOA), C.R.S. §§ 38-33.3-101 to -402, governs condominiums, cooperatives and planned communities under one statute, so the same budget rules generally apply to a condominium and a planned community.

Assessment authority has three layers:

1. The declaration. It sets how common expenses are shared and can impose stricter budget rules. Section 303(4)(a)(II) defers to the declaration in three places: whether owner approval is required, which class majority applies, and whether a veto takes more than a simple majority.
2. CCIOA. Section 315 requires annual assessments based on an annual budget. Section 303(4) sets the ratification procedure. Section 209.4 requires annual disclosure of the budget and the assessments.
3. The board. Under § 303(1)(a), the executive board may act for the association in all instances except where the declaration, the bylaws or § 303(3) limit it. Building the budget is a board function. Ratification is the owners’ check on it.

Which communities this reaches. CCIOA applies in full to communities created on or after July 1, 1992. Communities created before that date get only the sections listed in § 38-33.3-117, each from a stated date (see below). Small new cooperatives and planned communities that qualify under § 38-33.3-116 are subject only to §§ 105–107 unless their declaration opts into the whole Act. That covers communities that are nonresidential only, those with 20 or fewer units and no development rights, and those whose declaration caps average annual common-expense liability at $400 per unit (CPI-adjusted). Section 116 was amended by SB24-021, effective August 7, 2024. Which category a particular community falls in is a question for association counsel.

How the Ratification Procedure Works

The summary: within 90 days of adoption

The statute times the procedure from the board’s adoption of the proposed budget. Within 90 days after adoption, the board must mail or otherwise deliver a summary of the budget to all unit owners. Delivery includes posting on the association’s website (§ 303(4)(a)(I)). The statute calls for a summary, not the full working budget. The full current operating budget is also an annual-disclosure item under § 209.4(2) (see below).

The owners’ meeting

The board must set a date for an owners’ meeting to consider the budget within a reasonable time after the summary goes out. Notice is given as the bylaws allow (§ 303(4)(a)(I)). Section 38-33.3-308(1) separately sets general notice rules for owners’ meetings. Notice goes out 10 to 50 days before the meeting, by hand or mail to each unit, with physical posting where feasible. It must state the time, the place, the agenda items, and any budget changes. Boards commonly ask counsel how the bylaw notice language and § 308(1) fit together for the budget meeting.

Deemed approval unless vetoed

This is the core of the Colorado rule. Unless the declaration requires otherwise, the budget does not need owner approval. It is deemed approved unless, at that meeting, it is vetoed by a majority of all unit owners, or by a class majority or a larger percentage if the declaration provides for one. This applies whether or not a quorum is present (§ 303(4)(a)(II)(A)).

The statutory default measures the veto against all unit owners, not those present, and the quorum language means attendance does not decide whether the procedure runs. How a particular declaration’s class or percentage terms change the count is a question for association counsel.

After a veto

If the owners veto the proposed budget, the periodic budget last proposed by the board and not vetoed continues until a later budget is not vetoed (§ 303(4)(a)(II)(A)).

Pre-1992 Communities and the Cap Exception

Section 38-33.3-117 phases CCIOA sections in for communities created before July 1, 1992:

Section 315 is not on the § 117 list in full. Only § 315(7) appears, from January 1, 2006. Boards of older communities commonly ask counsel how assessment frequency is governed for them. The 8% interest cap also appears in § 209.5(8)(a), which is within the §§ 209.4–209.7 range on the list.

The cap exception. The veto procedure does not apply to a pre-1992 community whose declaration sets a maximum assessment or caps annual increases, as long as the budget stays within that cap (§ 303(4)(a)(II)(B)).

Opting in. A pre-1992 community may elect full CCIOA treatment by amendment under § 38-33.3-118. In Accetta v. Brooks Towers Residences Condominium Ass’n, 2021 COA 87, the Court of Appeals held that § 118 provides the exclusive means of making that election. Recording a new declaration that “might be interpreted to adopt the provisions of CCIOA” was not enough.

Assessments, Interest and Priority

• Frequency. Assessments are made at least annually, based on a budget adopted at least annually (§ 315(1)).
• Interest. Past-due assessments bear interest at a rate the association sets, not over 8% per year (§ 315(2)). Since HB22-1137 (effective August 10, 2022), the same 8% cap applies to assessments, fines and fees (§ 209.5(8)(a)).
• Six-month super-priority. The association’s assessment lien has priority over the first mortgage up to six months of assessments (§ 316(2)(b)). In First Atlantic Mortgage, LLC v. Sunstone North Homeowners Ass’n, 121 P.3d 254 (Colo. App. 2005), the court held that the amount of the priority lien is measured only by six months of regular common-expense assessments. That case construed the 2004 text, and § 316 has been amended since. Texas has no statutory super-priority; Florida’s safe harbor is a different mechanism.
• Registration. If an association’s annual registration with the Division of Real Estate is missing or expired, its right to impose or enforce a § 316 lien is suspended until it registers (§ 38-33.3-401(3)). See Registering With DORA.

Collecting unpaid assessments is a separate, heavily regulated process. It involves a required collection policy, a recorded board vote before an account is referred, an offer of an 18-month payment plan before foreclosure, and further limits added in 2024 and 2025. That process is covered in Collections in Colorado and Colorado Assessment Liens and Foreclosure.

Owner Oversight Beyond the Veto: Audit, Review and Disclosure

Audit or review (§ 303(4)(b))

The books may be audited (GAAS, by a CPA) or reviewed (SSARS) at the board’s discretion. An audit is required only if annual revenues or expenditures are at least $250,000 and owners of at least one-third of the units request it. A review is required only if owners of one-third of the units request it. Copies are available on request to any owner no later than 30 days after the audit or review is completed.

Annual disclosure (§ 209.4(2))

Within 90 days after turnover from the declarant, and within 90 days after the end of each fiscal year, the association must make available, among other items, its current operating budget, current regular and special assessments by unit type, annual financial statements including amounts held in reserve, and the results of the most recent audit or review. The association may disclose these by website (with mail or e-mail notice of the address), by a literature binder at its principal office, or by mail or personal delivery, at no cost to owners (§ 209.4(3)).

Reserves: A Policy Requirement, Not a Funding Mandate

The 2024 CCIOA text contains no mandate to commission a reserve study or to fund reserves at a set level. What it requires is narrower:

• a written reserve-study policy stating whether the association has a reserve study, whether there is a funding plan and what its projected sources are, and whether the study rests on physical and financial analysis (an internal study qualifies) (§ 209.5(1)(b)(IX))
• a reserve-fund investment policy (§ 209.5(1)(b)(VI))
• disclosure of reserve amounts in the annual disclosure (§ 209.4(2))
• keeping the most recent reserve study as an association record (§ 317(1)(k))

The standard for investing reserves. Board members not appointed by the declarant are generally liable only for “wanton and willful” acts or omissions (§ 303(2)(b)). For investing reserve funds, however, CCIOA applies the nonprofit act’s standard: good faith, the care of an ordinarily prudent person, and a reasonable belief that the decision is in the association’s best interests (§ 303(2.5), applying § 7-128-401). Under § 303(2.5), “officer” includes anyone the board delegates to, including a managing agent, attorney or accountant. Section 117 does not list § 303(2) or (2.5), so their reach to pre-1992 communities is a question for counsel.

New in 2026: the declarant reserve study. HB26-1099 was signed April 13, 2026 and took effect August 12, 2026 (Session Laws 2026, ch. 42). It adds § 38-33.3-209.2. Before transferring control to the association of a planned community or condominium, the declarant must obtain and pay for a reserve study projecting 30 years of costs for the components the association maintains. The study must be prepared by an independent professional with no business relationship with, financial interest in, or affiliation with the declarant. The study is added to the annual disclosures (§ 209.4(2)(j)) and to the turnover deliverables (§ 303(9)(n)). The act does not require a post-turnover association to update the study or fund to it. Whether § 209.2 reaches communities already past turnover, or pre-1992 communities, has not been confirmed and is a question for counsel.

Florida’s structural integrity reserve study (SIRS) regime has no Colorado counterpart. See The Nine Policies Every Colorado Association Must Adopt.

Texas Property Code Chapter 209 has no statutory owner veto of the annual budget; see HOA Assessment Authority in Texas in the CIC-SC library for the contrast.

Common Mistakes & Pitfalls

Frequently Asked Questions

Do owners have to approve the annual budget in a Colorado HOA?

Under § 38-33.3-303(4)(a)(II)(A), owner approval is not required unless the declaration requires it. The budget is deemed approved unless a majority of all unit owners vetoes it at the owners’ meeting, or a class majority or larger percentage if the declaration provides for one, whether or not a quorum is present. How a particular declaration’s class or percentage terms change the count is a question for association counsel.

When must a Colorado HOA board send owners the budget summary?

Within 90 days after the board adopts a proposed budget, it must mail or otherwise deliver a summary to all unit owners, and posting on the association’s website counts as delivery (§ 303(4)(a)(I)). The board then sets an owners’ meeting to consider the budget within a reasonable time after the summary goes out. The 90 days run from adoption of the proposed budget, not from the start of the fiscal year, and timing for a specific budget cycle is a question for association counsel.

What happens if Colorado HOA owners veto the budget?

If the owners veto the proposed budget, the periodic budget last proposed by the board and not vetoed continues until a later budget is not vetoed (§ 303(4)(a)(II)(A)). HB23-1131, which would have changed the veto math, was postponed indefinitely on February 14, 2023, so the “majority of all owners, quorum or not” rule remains the text CICSC reviewed. How the rule applies to a specific association is a question for counsel.

Does the Colorado budget veto rule apply to pre-1992 communities?

Under § 38-33.3-117(1.8), pre-1992 communities have been subject to the budget-veto rule since July 1, 2017. The veto procedure does not apply to a pre-1992 community whose declaration sets a maximum assessment or caps annual increases, as long as the budget stays within that cap (§ 303(4)(a)(II)(B)), and the article also notes the § 119 small-community exception. Whether an exception applies to a particular community is a question for association counsel.

What interest can a Colorado HOA charge on late assessments?

Past-due assessments bear interest at a rate the association sets, not over 8% per year (§ 38-33.3-315(2)). Since HB22-1137 (effective August 10, 2022), the same 8% cap applies to assessments, fines and fees under § 209.5(8)(a). Questions about a specific association’s charges go to association counsel.

Is a Colorado HOA required to have a reserve study?

The 2024 CCIOA text contains no mandate to commission a reserve study or to fund reserves at a set level; it requires a written reserve-study policy, a reserve-fund investment policy, disclosure of reserve amounts, and keeping the most recent reserve study as a record. HB26-1099, effective August 12, 2026, requires the declarant to obtain and pay for a 30-year reserve study before transferring control, but does not require a post-turnover association to update the study or fund to it. Whether § 209.2 reaches communities already past turnover, or pre-1992 communities, has not been confirmed and is a question for counsel.

Key Takeaways

• The board adopts a proposed budget, owners receive a summary within 90 days, and an owners’ meeting follows within a reasonable time.
• The budget is deemed approved unless a majority of all owners vetoes it, quorum or not. After a veto, the last non-vetoed budget continues.
• The declaration can require owner approval or a larger veto percentage.
• Pre-1992 communities are subject to the veto rule from July 1, 2017, with a cap exception.
• Interest on past-due amounts is capped at 8% per year. The assessment lien has priority over the first mortgage to the extent of six months of assessments.
• Audits and reviews become mandatory only when the owner-request triggers in § 303(4)(b) are met.
• Reserves require a policy, not a study, except the declarant’s pre-turnover study under HB26-1099.

References & Sources

1. C.R.S. § 38-33.3-303(1)(a), (2)(b), (2.5), (4)(a)–(b), (9) — Executive board; budget adoption and veto; audit and review. Colorado Revised Statutes 2024, Title 38 (OLLS). content.leg.colorado.gov — crs2024-title-38.pdf
2. C.R.S. § 38-33.3-315(1)–(2) — Assessments for common expenses; interest.
3. C.R.S. § 38-33.3-117(1), (1.5), (1.7), (1.8) and § 38-33.3-118 — Applicability to pre-1992 communities; election to opt in.
4. C.R.S. § 38-33.3-116 — Small and limited-expense communities (as amended by SB24-021, eff. August 7, 2024).
5. C.R.S. § 38-33.3-308(1) — Owners’ meetings and notice.
6. C.R.S. § 38-33.3-209.4(2)–(3) — Annual disclosure.
7. C.R.S. § 38-33.3-209.5(1)(b)(VI), (IX), (8)(a) — Reserve investment and reserve-study policies; interest cap.
8. C.R.S. § 38-33.3-316(2)(b) — Lien priority. C.R.S. § 38-33.3-317(1)(k) — Reserve study as a record.
9. C.R.S. § 38-33.3-401(3) — Registration; suspension of lien rights.
10. C.R.S. § 7-128-401 — Director standards of conduct (Colorado Revised Nonprofit Corporation Act). crs2024-title-07.pdf
11. HB26-1099, Protect Financial Condition of Homeowners’ Associations, Session Laws 2026, ch. 42 (eff. August 12, 2026). leg.colorado.gov/bills/hb26-1099
12. HB22-1137, HOA Board Accountability and Transparency, Session Laws 2022, ch. 367 (eff. August 10, 2022). leg.colorado.gov/bills/hb22-1137
13. HB23-1131, Majority of Unit Owners Required for HOA Budgets (postponed indefinitely February 14, 2023). leg.colorado.gov/bills/hb23-1131
14. First Atlantic Mortgage, LLC v. Sunstone North Homeowners Ass’n, 121 P.3d 254 (Colo. App. 2005) (construing the 2004 text of § 316).
15. Accetta v. Brooks Towers Residences Condominium Ass’n, 2021 COA 87.

Related Resources & Additional Reading from the CIC-SC Library

• Special Assessments in Colorado — what CCIOA does and does not say about charges outside the annual budget.
• The Nine Policies Every Colorado Association Must Adopt Under § 38-33.3-209.5 — including the reserve-study and investment policies.
• Collections in Colorado — the required collection policy and payment plans.
• Is Your Colorado Association Compliant? — the statewide obligations in one list.
• Colorado HOA Board Member Governance Guide — the CCIOA map for new directors.

Tags: Colorado HOA budget · budget ratification · owner veto · § 38-33.3-303(4) · CCIOA · assessments · 8% interest cap · reserve study policy · HB26-1099 · pre-1992 communities · Colorado HOA governance

Disclaimer. This article is published by the Common Interest Community Standards Council for educational and informational purposes only. It is not legal advice and does not establish an attorney-client relationship. Statutory references and procedural frameworks are intended to support informed governance, not to substitute for advice from qualified Colorado legal counsel. Boards and managers should consult their association’s attorney about the application of any statute, governing-document provision, or procedural decision to their specific circumstances. CIC-SC, its authors, and its members assume no liability for actions taken in reliance on this content.

Published by the Common Interest Community Standards Council (CICSC). Part of the CICSC Member Education Library. © 2026 CICSC. Educational use permitted with attribution.