Charging for Association Documents In The Post-SB 100 World.
We have received a lot of questions concerning what documents associations may charge for in the post-SB 100 world. The answer to this question lies in why the documents are being furnished or copied. The following bullet points list the most common situations in which associations furnish or copy records for their owners.
Documents Furnished to Comply With The Required Annual Disclosure: Section 38-33.3-209.4(2) requires associations, within 90 days after transition and within 90 days after the end of each fiscal year after that, to make certain enumerated disclosures such as the date the association's fiscal year begins; the association's operating budget for the current fiscal year; a list of the association's current regular and special assessments; the association's annual financial statements - including any money held in reserve for the fiscal year immediately preceding the current annual disclosure etc.
The statute allows associations to make these disclosures in one of four ways - 1) posting the information on an internet web page with notice of the web address sent either by first-class mail or e-mail to all owners; 2) mailing the information to all owners; 3) personally delivering the information to all owners; or 4) maintaining a literature table or binder at the association's principal place of business.
Association must make this information available AT NO CHARGE to owners. This no charge mandate means that associations may not charge owners to access the website or for the copying costs of assembling the binders, if either of those methods were chosen to make the disclosure. However, the statute requires associations to make the information available, not distribute it (e.g. allowing the disclosures to be made by website or in a binder). Therefore, an association may charge actual costs for copying the disclosed documents if disclosure is made through the maintenance of a literature table or a binder.
Owner Requests To Copy and Inspect Association Documents: Section 38-33.3-317 addresses owner inspection and copying of association records, as well as listing the documents associations are required to keep. Except for any documents posted on a website to achieve compliance with an association's disclosure requirements under section 38-33.3-209.4 (discussed above), an association may charge its actual cost* for providing copies of these documents.
Owner Requests for Association Documents When Selling Unit: SB 100 added two seller disclosure sections - section 38-33.3-223 and 38-35.7-102. These sections require a seller of property within a common interest community to disclose certain documents to the buyer (e.g. association's bylaws and rules, the association's declaration, any party wall agreements, the association's operating budget.) Associations may charge their actual costs* for providing copies of these documents to furnish these documents to the seller. In addition, many associations use CondoCerts or other similar service.
* "Actual costs" is not defined in the statute. However, based on the negotiations concerning this provision during last legislative session, it is our opinion that "actual costs" means a reasonable fee that may include personnel and equipment used for the search, retrieval, and copying of the records. We do not believe that actual cost includes the time spent watching the owner inspect the records.