Sage Port #2

Architectural Control Committee

Larkspur, Colorado

The SP "HOA", HOAs and Colorado Law

Understanding Colorado Homeowner Associations, CO Law and how it applies to

Sage Port #2

In general, an HOA is a legal entity set up to manage and maintain a neighborhood. Its members consist of ALL homeowners in the community - membership is mandatory. The original developer of the community typically creates the HOA in the establishment Covenants.

However Sage Port #2 never established an HOA as part of its Covenants!

Enter the Colorado Common Interest Ownership Act – CCIOA

The Colorado Common Interest Ownership Act “CCIOA” which went into effect on July 1, 1992, is a comprehensive statute covering the creation and operation of common interest communities.

However, this Law did not supersede preexisting Covenants by mandating that all communities establish an HOA. It is only mandatory on new developments. Preexisting communities could be regulated by CCIOA only if they met several sets of very specific requirements.

One of the primary reasons that our Sage Port #2 community does not qualify as a “common interest community” within the meaning of the Colorado Common Interest Ownership Act, “CCIOA” because it does not fit within the following requirement:

38-33.3-103(8) “Common interest community” means real estate described in a declaration with respect to which a person, by virtue of such person’s ownership of a unit, is obligated to pay for real estate taxes, insurance premiums, maintenance, or improvement of other real estate described in a declaration. (emphasis added)

Our Sage Port #2 community does not have “other real estate” for which the property owners are obligated to pay common expenses.

Sage Port #2 home owners, the private Sage Port "HOA" group and CCIOA

Around 2003 the then Board of the private Sage Port "HOA" group under President Mark Hesse (currently still a SP"HOA" board member) stated their desired objective for the conversion of Sage Port #2 from a community of voluntary, self–governance to one of mandatory control with his private SP "HOA" group providing the total regulation and enforcement over our owners.

This desire soon turned to force as the Sage Port HOA's President Mark Hesse in June, 2003 personally recorded 64 liens against Sage Port #2 Owners for back dues to his group, claiming authority to collect mandatory dues from them. This act was quickly escalated to the Douglas County District Attorney who immediately declared the liens illegal and ordered their removal under penalty of legal action. Naturally they were removed! They were also required going forward to clearly state that they were a Voluntary Group - owners could not be forced to join.

The 60+ liens recorded against home owners was just his first attempt to implement this governing control and enforcement over our home owners. It would eventually turn into 5+ years of intense community conflicts, additional legal actions and court battles along with the expenditure of hundreds of thousands in legal fees.

The end of the attack and the reestablishment of Sage Port #2 home owner rights

Finally, in April, 2009, after years of court battles, Judge Nancy Hopf of the Douglas County District Court finally put an end to the disputes and settled the key question: Did Sage Port #2 home owners fall under the HOA requirements of the CCIOA law and as such were we subject to the mandatory control and enforcement of the so-called Sage Port HOA.

Her ruling was simple and to the point:

That under CO law, neither Sage Port #2 nor the private Sage Port HOA is governed in any respect by the terms of CCIOA.

So what we have here in Sage Port #2 is:

· A community not subject to a mandatory HOA under the Colorado CCIOA Law.

· A community established without any regulatory HOA under our 1971 Protective Convents.

· A private SP "HOA" group which has no regulatory powers under CCIOA.

· A private SP "HOA" group which has no regulatory powers under our Protective Convents.

· A private SP "HOA" group with no support from the majority (90+%) of our home owners.

· The only regulatory body in Sage Port #2 is the Covenants ACC with very limited powers.

In 2016 when our Covenants were up for modification, our owners by some 90% again rejected bids by Mark Hesse and other members of this private HOA group to establish themselves as a regulatory HOA for Sage Port #2