How the penalties actually work

The two remedies are separate, and the distinction is worth getting right.

The $250 is not conditioned on bad faith. Subsection (9)(b)(II) says the former company “shall pay to the association two hundred fifty dollars for each business day” of non-compliance. Note business day, not calendar day — roughly twenty-one per month, so about $5,000 a month of exposure before anything else. It accrues on a company that simply lost track of the deadline.

Treble damages require willfulness. Subsection (9)(b)(III) applies in a civil action to enforce the subsection: if the violation “is found to be willful,” the company is liable for treble the association's actual damages plus reasonable attorney fees and court costs.

And there is a third head of liability that gets overlooked. Subsection (9)(b)(I) makes the company liable for all interest and late fees on late payments the association makes because of the failure, plus any other damages the association incurs from being unable to reach its own accounts, money, property or information. An association locked out of its operating account while a vendor invoice goes past due has a claim for the late fee itself.

The sentence that decides whether any of this applies to you

Subsection (9)(b) opens with six words: “unless otherwise agreed in writing between the association and the former association management company.”

The penalties are defaults, and the parties can contract around them. That makes the management agreement, not the statute, the document that determines a Colorado association's actual position — and it makes any management contract signed on or after August 12, 2026 the single highest-leverage document a board will review this year. A waiver of the per-day amount, or of the treble-damages remedy, is now a term a management company can reasonably be expected to ask for. A board that signs one has given away the enforcement mechanism the legislature just built.

Where boards and managers stand

Boards: read the penalty-waiver question before the renewal, not after the dispute. On the day you terminate or decline to renew, send a dated written itemized demand tracking the statutory list — and put passwords, insurance policies and keys in it by name, because those are the items most often withheld. Then calendar day forty-five and log every business day past it, because the penalty is measured in them.

Managers: build a forty-five-day offboarding procedure with a delivery receipt signed by the successor, and confirm with your software vendor that a full data export is possible. The carve-out protects the platform only if the data inside it actually leaves.

One more item the Division of Real Estate flags: the association's login credentials for its own state HOA registration account are association property too, and registration information must be updated within ninety days after any change under C.R.S. 38-33.3-401(2)(a). An association whose registration renewal notices go to a former manager's inbox has a problem that compounds quietly — CCIOA suspends the association's right to impose or enforce an assessment lien until it is validly registered.

What to watch next

These are private remedies. The Division of Real Estate does not collect the $250 and does not enforce subsection (9); it is an association's claim in court. Watch whether the state's complaint data moves — the HOA Information and Resource Center recorded 364 complainants in 2025, up 21% from 300 the year before, and 24% of the complaint categories it logged were aimed at a manager or a management company rather than a board. Colorado still does not license community association managers, so this statute is now one of the few duties the state has placed on them directly.