The Colorado Legislature enacted two construction defect reform legislation, one decreasing insurance prices to encourage condo growth and the other protecting homeowners from poor buildings. Although there is certain opposition, the measures strive to balance the interests of homeowners and builders by addressing concerns regarding affordable housing and construction defects.
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Colorado Construction Reform
This week, the Colorado Legislature passed two bills to reform the state's construction defect law. One of the bills would reduce insurance premiums to encourage more condo development, and the other would provide homeowners with excellent protection against substandard construction. The Construction Defect Action Reform Act of the state, which establishes a framework for homeowners to bring suit against developers if they uncover flaws with the build, is the subject of both of these cases; yet, the focus of each case is on a different party in the defect resolution procedure.
On Friday, Mar. 22, the House of Representatives handed preliminary approval to bill 24-1230. By increasing the statute of repose from six to ten years, an individual could file a construction defect lawsuit. Even if they are not members of a formal homeowner association, homeowners in a comparable situation, such as those who live on the same street and have properties with the same structural problems, could bring a claim together under the bill's provisions.
Moreover, although there was a delay of two weeks between the hearing of witnesses and the committee's voting, Senate Bill 24-106 succeeded in its first committee on Thursday, Mar. 21. As mentioned, rather than concentrating on the more significant housing market, it is more concerned with boosting the supply of condominiums, which are typically more affordable housing options for persons with lower incomes and younger generations than detached single-family homes usually are.
Advocates of the legislation, predominantly comprised of builders and municipal governments, assert that its implementation is critical for the state to accomplish its affordable housing objectives through mitigating litigation and, consequently, insurance expenses associated with condominium construction.
Accordingly, the bill's sponsors made an effort to include a provision that would have provided a more precise explanation of the kind of 'imminent and unreasonable' damages necessary for filing a lawsuit about the matter. For instance, collapsing stucco, an issue that could produce mold or a problem with the building's structural stability, would be examples of the types of damages required. In addition, incorrectly built roof flashing would reportedly not be sufficient to sustain a claim because the problem is not causing any damage to the property or affecting the roof's performance.
Also Read: From Damage Repair to Weather Protection: 8 Benefits of Giving Your Structure a Fresh Coat of Paint
Oppositions to the Bill
On Thursday, Mar. 21, Democratic Senators Winter, Sonya Jaquez Lewis of Longmont, and Julie Gonzales of Denver voted against SB 106 despite the many implemented amendments. Winter expressed her disapproval of the trade-off proposed by the measure, which she considers an excessive number of risks for homeowners and in which builders will not address their concerns in return for a 'nudge' to reduce insurance premiums.
Thus, many supporters were delighted to see the measure make it through the committee, especially considering that pre-session adjustments replaced moderate Democratic Sen. Dylan Roberts on the committee's board with the considerably more progressive Sen. Winter. Furthermore, Exum demonstrated his ability to influence the outcome by actively engaging in revision negotiations and urging the industry and contractors to re-enter the condo market, which was considerably more robust before implementing a 2007 law that facilitated the filing of defect litigation.
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