Q:  Do homeowners have the right to reject the dollar amount in proposed budgets?

A:  Communities created after July 1, 1992 are subject to the budget ratification provision set forth in the Colorado Common Interest Ownership Act (“CCIOA”).  That provision states that unless an association’s declaration provides otherwise, a proposed budget does not require approval from owners.  Instead, a proposed budget will be deemed approved by owners if a majority of all owners in the community fail to veto the proposed budget.  Pursuant to the CCIOA budget ratification process, homeowners can reject the total dollar amount in a proposed budget only if a majority of all the homeowners veto the entire proposed budget.  CCIOA does not allow owners to reject individual dollar amounts in proposed budgets, rather, only the entire budget.

If the declaration of an association created after July 1, 1992 requires owner approval (as permitted by the CCIOA provision), that requirement must be followed by the board of directors when presenting a budget for approval.  Thus, the homeowners’ right to reject dollar amounts presented in the budget will depend entirely on the budget provisions set forth in the declaration.

If a community was created prior to July 1, 1992, it is not subject to the budget ratification process set forth in CCIOA.  Therefore, the board must comply with any approval/ratification requirements set forth in the association’s governing documents.  If you are not sure about the requirements set forth in your governing documents, legal counsel should be consulted.