The internet recently has been ablaze with people talking about Marie Kondo and her Netflix show on tidying up. The show revolves around Marie helping people declutter their homes and keep only the things that “spark joy”. And while we wish that homeowner associations could toss out documents as easily as Marie tosses out items on the show, the Colorado statutes seem to care very little about “spark joy.”
The Colorado Common Interest Ownership Act (CCIOA), at C.R.S. §38-33.3-317 and C.R.S.§38-33.3-209.4, and the Colorado Nonprofit Act, at Article 136, outline the type of documents required to be maintained by an association. Despite the specific list of documents to be maintained, the statutes lack explicit retention time frames for all but a few documents. Here are a few retention time frames prescribed by statute:
- Board and owner meeting minutes, permanently;
- Records of all actions taken by the owners or board without a meeting (i.e., actions by mail or electronic mail), permanently;
- Association tax returns, seven years;
- Contracts, two years after the completion of work performed;
- Proxies and ballots, one year after election, action or vote to which they relate;
- All written communication within the past three years to all unit owners generally as unit owners.
Associations produce and retain a myriad of documents over time. Given the lack of statutory retention time frames for most documents, associations should adopt their own time frame via a Document Retention Policy. The policy includes a comprehensive list of records and the requisite retention time frames for all. Having such a policy makes it convenient for associations to know exactly what they need to keep and how long to keep it for.
Document retention is an integral part of association governance. Proper organization and maintenance of documents allows for an association to adequately comply with the owner inspection and disclosure provisions of CCIOA, as well as to protect itself should it become engaged in litigation. Failure to properly maintain documents could result in fines and penalties should the matter proceed to the courts.
Please feel free to contact any of our attorneys at 303-432-9999 if your association would like more information on document retention policies, or has questions on the legal framework within which organization documents must be maintained.