2026 Legislative Update for HOAs

The Colorado General Assembly adjourned its 2026 legislative session on May 13, bringing several updates that impact homeowner associations. Most of the new laws take effect on August 12, 2026. At Westwind, we are committed to helping our boards and communities understand what has changed and how to respond in a practical, informed way.

‍
What are the changes and what may they mean for your community?

HB26-1099

One of the most impactful updates comes from HB 26-1099 “Protect Financial Condition of Homeowners Associations”, which focuses on protecting the financial condition of HOAs. For new communities still under declarant control, an independent reserve study must now be completed as part of the transition process at 75% buildout. This ensures that communities begin operations with a clearer understanding of long-term funding needs. The same bill also adjusts requirements for records turnover when a management contract ends. Management companies now have 45 days to transfer association records, rather than 30 days, and must do so at no cost. Penalties including $250 per business day fines and extra punitive/legal costs apply if the deadline is not met. While this extends the timeline slightly, it also sets clearer expectations

HB26-1007

‍HB 26-1007 “Improve Customer Use Distributed Energy Resources” allows homeowners to use portable solar generation devices designed to plug into a wall outlet. Associations cannot unreasonably restrict these devices, including on limited common elements, but may adopt reasonable guidelines related to size, placement, and appearance. Owners are responsible for the installation, maintenance, and any liability associated with these systems, including compliance with local building and fire codes. Communities should review or adopt rules that address these devices in a balanced way. Clear guidelines will help support sustainability while maintaining the overall appearance and safety of the property.

HB26-1045

HB 26-1045 “Disabilities Housing Protections” expands protections under the Colorado Anti-Discrimination Act by clarifying that assistance animals include both service animals and emotional support animals. Associations must allow reasonable accommodations, though they may request appropriate documentation and deny requests that present a direct threat or risk of damage.
Policies related to animals should be reviewed to ensure compliance. This is an opportunity to confirm your procedures are consistent, respectful, and aligned with current law.

Fannie Mae & Freddie Mac - FHA Lending Guidelines

In addition, some considerations for future budgeting and insurance requirements relate to recent updates tied to Fannie Mae and Freddie Mac lending guidelines. There are new expectations around reserves funding and insurance. Associations are encouraged to allocate at least 15 percent of their budget toward reserves, unless supported by a current reserve study with a different recommendation. Changes also affect insurance requirements, including adjustments to replacement cost expectations and deductible limits for certain communities.
Now is a good time to review your annual budget and reserve contributions. You should also evaluate your current insurance coverage with your broker to ensure it aligns with evolving lending standards.
One notable change for metropolitan districts is the repeal of prior requirements related to irrigation equipment standards under HB 26-1034. This eliminates certain compliance obligations that were introduced in earlier legislation.

Other bills this session include administrative updates to elections, foreclosure procedures, and broader initiatives such as statewide housing and homelessness strategies. While many of these are informational, they reflect ongoing shifts in regulatory priorities.

Most items do not require immediate action, but staying informed will help you anticipate future changes and community impacts.

Legislative updates can sometimes feel complex, but they are an important part of maintaining a well-run and compliant community. Our role as a management partner is to help translate these changes into clear, actionable guidance so your board can make confident decisions.

‍