Colorado HOA Assessment Limits

Section 1: Overview, how assessment authority and limits work in Colorado

In Colorado, assessment authority for common interest communities created on or after July 1, 1992 rests on a single statute: the Colorado Common Interest Ownership Act, or CCIOA. The state does not cap how much an association can raise assessments in any given year. Instead, CCIOA controls increases through a budget ratification mechanism — the board proposes a budget, delivers a summary to all unit owners, and the budget takes effect unless a majority of all unit owners votes to reject it.¹ CCIOA is codified at C.R.S. § 38-33.3-101 et seq., was enacted in 1991, and took effect July 1, 1992.² Regular assessments carry no numeric ceiling — the control is process: the executive board adopts a proposed budget, delivers a summary to all unit owners, and the budget is ratified unless owners reject it at a noticed meeting.³ Special assessments are generally treated the same way, with the board levying them and the same owner-veto ratification process applying, subject to the governing documents.⁴ On the national spectrum, Colorado falls with the ratification-mechanism states — Colorado, Connecticut, Alaska, and Washington — that rely on an owner veto rather than a fixed ceiling, in contrast to statutory-cap states such as California and Arizona, which limit increases by a fixed percentage, and CC&R-primary states such as Alabama, Arkansas, and Mississippi, where the recorded declaration sets the limits.⁵ The sections that follow detail the statutory framework, procedures in practice, recent legislative and judicial activity, and Colorado's position among other states.

Section 2: The assessment framework

2A. Authority to levy and allocate assessments

CCIOA places a duty on associations to assess for common expenses. Once an association makes its first common expense assessment, it must assess at least annually, basing each levy on a budget adopted at least annually. With limited exceptions, all common expenses get assessed against all units according to the allocation formula set out in the declaration under C.R.S. § 38-33.3-207. Section 38-33.3-315(2) requires every declaration to state that formula. The executive board wields this authority through the budget process: CCIOA permits the association — without specific authorization in the declaration — to adopt and amend budgets for revenues, expenditures, and reserves, and to collect assessments for common expenses from unit owners. Every unit owner is liable for assessments on their unit. No owner can escape that liability by waiving use of the common elements or abandoning the unit.⁶

CCIOA applies in full to communities formed on or after July 1, 1992. Communities formed before that date operate primarily under their recorded declarations and the older Colorado Condominium Ownership Act, C.R.S. § 38-33-101 et seq. But C.R.S. § 38-33.3-117 extends a defined list of CCIOA provisions retroactively to those older communities for events occurring after July 1, 1992. That retroactive list includes the assessment lien under section 38-33.3-316 and — through subsection (1.8) — the budget summary and meeting mechanism under section 38-33.3-303(4)(a)(I), so the budget ratification procedure reaches pre-1992 communities as well. The detailed allocation rule in section 38-33.3-315(2) applies only to communities formed on or after July 1, 1992; for older communities, the recorded declaration controls how the dollar total is divided among units.⁷

2B. Limits on regular assessment increases

CCIOA sets no fixed percentage cap on regular assessment increases. The control lives in the budget ratification process under C.R.S. § 38-33.3-303(4). Within ninety days after the executive board adopts a proposed budget, the board must deliver a summary to all unit owners — by first-class mail or, if the association posts documents online, on its website — and must set a date for an owner meeting to consider the budget. The statute does not specify an exact deadline for that meeting; it must occur within a reasonable time after the summary is delivered, or as the bylaws allow, with notice as the bylaws provide. Unless the declaration requires otherwise, the budget does not need affirmative owner approval. It takes effect automatically unless, at the noticed meeting, a majority of all unit owners — or any larger percentage specified in the declaration — votes to reject it, whether or not a quorum is present. If owners do reject the budget, the last unvetoed budget stays in effect until the board proposes one that owners do not reject.³

No statutory percentage cap limits a Colorado increase. A declaration can impose stricter limits — a maximum assessment amount or a ceiling on annual budget increases — and where it does, that stricter limit governs. CCIOA expressly recognizes this for pre-1992 communities: section 38-33.3-303(4)(a)(II) does not apply where a pre-1992 declaration caps assessments and the proposed budget stays within that cap. Process defects carry real consequences. A board that skips the required summary delivery, fails to properly notice the ratification meeting, or overrides a stricter declaration limit opens the budget to owner challenge. Separately, the interest a board may charge on past-due assessments is capped by statute at eight percent per year unless the governing documents set a different rate — but that is a delinquency-interest cap, not a limit on the assessment itself.^3,8

2C. Special assessments and the declaration

CCIOA creates no separate definition or standalone approval threshold for special assessments. The authority to levy a special assessment comes from the governing documents. In most Colorado communities, once the board approves a special assessment, the board must run the same section 38-33.3-303(4) ratification process: mail a budget summary to all owners within ninety days and hold a meeting where owners can vote to reject it. In most cases, the board may levy a special assessment by majority vote of the board — with no separate owner approval required unless the governing documents require it — and owners must have an opportunity to speak before the board votes. CCIOA contains no emergency-assessment carve-out of the kind found in some statutory-cap states. The declaration is decisive beyond the statutory baseline: it can cap special assessments, require a supermajority owner vote, or restrict them to defined purposes. The operational implication is direct: a board cannot rely on CCIOA alone to determine the ceiling on a special assessment. It must read the declaration against CCIOA to identify the actual limit and approval requirement.⁴

Section 3: Assessment limits and procedures in practice

A. Regular assessment increase procedure

The board adopts a proposed budget, delivers a summary to all unit owners within ninety days, and sets an owner meeting within a reasonable time or as the bylaws allow. The budget is ratified unless a majority of all unit owners — or a larger percentage stated in the declaration — rejects it at that meeting, with no quorum required. The ratified budget sets the regular assessment for the period, under C.R.S. § 38-33.3-303(4).³ This procedure applies to both CCIOA communities and, through section 38-33.3-117(1.8), pre-1992 communities — except where a pre-1992 declaration caps assessments and the budget stays within that cap.⁷

B. Special assessment procedure

The board generally approves a special assessment by majority vote. In most communities, the same section 38-33.3-303(4) summary-and-meeting ratification process then applies, with notice given as the bylaws require. Any additional owner-approval threshold comes from the declaration, not from CCIOA.⁴ This applies to both CCIOA and pre-1992 communities, subject to the same declaration-cap exception.⁷

C. Caps, ceilings, and override mechanisms

CCIOA sets no numeric cap on regular or special assessment increases. The operative control is the owner ratification veto. Where the declaration imposes a stricter limit — a maximum assessment or a budget-increase ceiling — that stricter declaration limit governs, under C.R.S. § 38-33.3-303(4).³ The only statutory numeric figure in this space is the eight-percent annual cap on interest charged on delinquent assessments, which does not limit the assessment amount itself.⁸

D. Notice, documentation, and disclosure tied to assessments

Beyond the budget summary, CCIOA gives owners a key disclosure tool. On written request delivered to the association's registered agent, the association must furnish a written statement of unpaid assessments — a status letter — within fourteen calendar days. That statement is binding. If the association fails to deliver it, the association forfeits the right to assert a lien for assessments due as of the request date, under C.R.S. § 38-33.3-316(8).⁹ The association must also maintain and disclose a list of the current amounts of all unique and extraordinary fees chargeable in connection with a unit purchase or sale — including the fee for the status letter itself — under C.R.S. § 38-33.3-317.¹⁰ The status-letter mechanism and lien provisions in section 38-33.3-316 reach both CCIOA and pre-1992 communities through section 38-33.3-117.⁷

Section 4: Recent legislative and judicial activity

No bill enacted in the past twenty-four months changed the budget ratification mechanism or introduced a percentage cap on assessments. The two enacted measures that touch assessments reshaped how associations collect and foreclose on unpaid assessments.

A. Recent bills

B. Recent appellate rulings

In the past twenty-four months, the Colorado Court of Appeals settled a foundational question about assessment authority in older subdivisions — one that carries direct consequences for any association operating in a community predating CCIOA.

C. Active legislative debates

A 2023 bill, HB23-1131, would have changed the ratification mechanism to require a majority of all unit owners to be present before a budget vote — but it was postponed indefinitely in committee and did not become law. The existing owner-veto ratification process remains unchanged.¹⁴ No pending Colorado proposal in the current session would impose a percentage cap on assessments or alter the ratification threshold.

Section 5: National positioning and related coverage

Colorado occupies the middle of the national assessment-limit spectrum. Statutory-cap states fix a numeric ceiling. California provides that notwithstanding more restrictive limits in the governing documents, "the board may not impose a regular assessment that is more than 20 percent greater than the regular assessment for the association's preceding fiscal year or impose special assessments which in the aggregate exceed 5 percent of the budgeted gross expenses of the association for that fiscal year without the approval of a majority of a quorum of members" under Cal. Civ. Code § 5605(b). Arizona similarly provides that "[u]nless limitations in the community documents would result in a lower limit for the assessment, the association shall not impose a regular assessment that is more than twenty percent greater than the immediately preceding fiscal year's assessment without the approval of the majority of the members of the association" under A.R.S. § 33-1803(A).¹⁵ Ratification-mechanism states — built on the Uniform Common Interest Ownership Act, including Colorado, Connecticut, Alaska, and Washington — use an owner veto on an adopted budget rather than a numeric cap. CC&R-primary states such as Alabama, Arkansas, and Mississippi leave the limits to the recorded declaration.⁵ For a multi-state operator moving from a percentage-cap state into Colorado, the control shifts from a numeric ceiling to a calendar and threshold question: meeting the ninety-day summary deadline, noticing the ratification meeting, and tracking whether a majority of all owners might veto. Colorado remains anchored to its 1991 enactment of CCIOA, as amended by the General Assembly over time, rather than adopting later uniform-act revisions to the assessment and budget provisions wholesale.²

1. Colo. Div. of Real Estate, Passing an Association Budget (C.R.S. § 38-33.3-303(4)) ↩
2. Colo. Gen. Assembly, Colo. Rev. Stat. tit. 38, art. 33.3 (CCIOA, enacted L. 91, eff. July 1, 1992) ↩
3. Colo. Div. of Real Estate, Passing an Association Budget, citing C.R.S. § 38-33.3-303(4)(a) ↩
4. Colo. Div. of Real Estate, HOA Forum: Special Assessments (Nov. 21, 2025) ↩
5. Colo. Div. of Real Estate, 2024 Colorado Common Interest Ownership Act (noting CCIOA is modeled on the Uniform Common Interest Ownership Act) ↩
6. C.R.S. § 38-33.3-315, Assessments for common expenses, as published by Colo. Div. of Real Estate ↩
7. Colo. Div. of Real Estate, HOA Forum: Pre-CCIOA Communities (Aug. 29, 2025), discussing C.R.S. § 38-33.3-117 ↩
8. Colo. Div. of Real Estate, HOA Frequently Asked Questions (eight-percent interest cap on delinquent assessments, C.R.S. § 38-33.3-315(2)) ↩
9. Colo. Div. of Real Estate, HOA Information about Assessments/Delinquency (C.R.S. § 38-33.3-316(8) status letter) ↩
10. C.R.S. § 38-33.3-317, Association records, Colo. Gen. Assembly ↩
11. Colo. Gen. Assembly, HB25-1043, Owner Equity Protection in Homeowners' Association Foreclosure Sales (2025 Reg. Sess.) ↩
12. Colo. Gen. Assembly, HB24-1337, Real Property Owner Unit Association Collections (2024 Reg. Sess.) ↩
13. Frisco Lot 3 LLC v. Giberson Preserve Homeowners Ass'n, Inc., 2024 COA 125 (Colo. App. Dec. 12, 2024) ↩
14. Colo. Gen. Assembly, HB23-1131, Majority Of Unit Owners Required For HOA Budgets (postponed indefinitely, 2023 Reg. Sess.) ↩
15. Ariz. Rev. Stat. § 33-1803; Cal. Civ. Code § 5605 ↩