Now that accounts receivables are finally starting to shrink, many associations are working hard to stabilize their communities’ finances and planning to take care of long-deferred maintenance projects.  During this upcoming budget season, boards and managers will be making important decisions about which projects can, and must, be funded next year and over the coming years.

Don’t forget to budget for deferred “legal maintenance” as well as community maintenance.

Through this difficult economic downturn, many communities have put off important legal projects due to lack of funds.  But failing to move forward with those deferred legal projects may expose associations to higher risk or legal fees in coping with lawsuits and governance issues.

Here’s a checklist of some potential “legal maintenance” projects that you may now be able to budget for:

  • Updates to “Good Governance” (SB 100/89) policies, to conform to new laws
  • Maintenance and Insurance Chart
  • FHA Certification (for condominiums)
  • Insurance Audit
  • Amendments to declarations, bylaws or articles of incorporation

For example, experts in the insurance industry expect insurance deductibles to increase in Colorado over the coming year in the wake of recent fires and hail storms.  These increases would mean communities have a greater exposure to uninsured losses, which in turn may increase litigation between associations and owners or insurers over issues like negligence, collection and bad faith. A legal insurance audit is the first step to making sure your insurance coverage is adequate and that your association’s governing documents and policies are clear, to help reduce the risk and cost of these kinds of conflicts.

Contact one of our attorneys for quotes to help budget to take care of your deferred legal maintenance at 303.432.9999.

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