A Bill for an Act
Page 1, Line 101Concerning housing.
Bill Summary
(Note: This summary applies to this bill as introduced and does not reflect any amendments that may be subsequently adopted. If this bill passes third reading in the house of introduction, a bill summary that applies to the reengrossed version of this bill will be available at http://leg.colorado.gov.)
For construction of middle market housing, section 3 of the bill requires a person filing a construction defect action against an architect or engineer to file with the complaint an affidavit of a third-party licensed professional indicating the negligence or other action, error, or omission of the construction professional. Section 3 also establishes a rebuttable presumption that a property does not have a construction defect when a state agency or local government has issued a certificate of occupancy for the property.
Section 4:
- Establishes a claimant's duty to mitigate an alleged construction defect and specifies how a claimant may satisfy this duty and the consequences to a claimant that fails to satisfy this duty;
- Requires that a construction professional must send or deliver to the claimant an offer to settle the claim or a written response that identifies the standards that apply to the claim and explains why the defect does not require repair; and
- Requires a construction professional who is the defendant in a construction defects action to submit specified information to the claimant.
Section 5 updates the statute of limitations for construction defect claims to 10 years unless the construction professional provided the consumer with a warranty that meets the requirements of the bill, in which case the statute of limitations is 6 years. Section 6 tolls the statute of limitations or repose during a claimant's mitigation of an alleged construction defect claim brought for the construction of middle market housing.
Section 7 allows a construction professional that meets specified requirements to use certain affirmative defenses in construction claims brought against the construction professional for the construction of middle market housing.
Current law requires the executive board of a unit owners' association (executive board) to obtain approval from a majority of owners before initiating a construction defect claim on behalf of the owners. Section 8 increases the approval amount to 65%. Section 8 also requires an executive board that is successful in a construction defect claim to first use monetary damages received as a result of the claim to repair the construction defect.
Page 2, Line 1Be it enacted by the General Assembly of the State of Colorado:
Page 2, Line 2SECTION 1. Short title - legislative declaration. (1) The short title of this act is the "Colorado American Dream Act".
Page 2, Line 3(2) The general assembly finds that:
Page 2, Line 4(a) Homeownership is a cornerstone of economic stability, but for
Page 2, Line 5many Coloradans, particularly first-time homebuyers, it has become
Page 2, Line 6increasingly out of reach. Surveys show that while 90% of renters aspire
Page 3, Line 1to own a home, more than half believe it is unattainable. This concern is
Page 3, Line 2personal for many, with over 4 out of 5 parents expressing concerns about
Page 3, Line 3whether their children will be able to afford to live in Colorado. Many
Page 3, Line 4Coloradans agree that increasing the variety and availability of housing
Page 3, Line 5options is crucial, as people want the ability to find and choose housing
Page 3, Line 6that fits their needs, whether it's through more accessible price points or housing types.
Page 3, Line 7(b) Millennials, the largest group of homebuyers in Colorado at
Page 3, Line 838% of the market, are facing increasing challenges, as the median age of
Page 3, Line 9first-time homebuyers has risen from 35 to 38 in just the past year. These
Page 3, Line 10gaps are just a few of many that highlight the urgent need for policies that
Page 3, Line 11facilitate affordable and attainable homeownership, particularly through the construction of entry-level homes.
Page 3, Line 12(c) Condominiums and townhomes have often served as
Page 3, Line 13affordable starter home options, providing the first step on the
Page 3, Line 14homeownership ladder for many Coloradans. Despite the clear need for
Page 3, Line 15these homes, however, condominium development in Colorado has
Page 3, Line 16drastically decreased. Before 2009, there were 1.25 new apartments for
Page 3, Line 17every one condominium. This has shifted radically to 14 new apartments
Page 3, Line 18for every condominium in recent years. The decline in condominium
Page 3, Line 19construction coincides with a housing shortfall of at least 100,000 homes
Page 3, Line 20in the state, further worsening the availability of affordable options for first-time buyers.
Page 3, Line 21(d) Current construction litigation laws are often cited as a
Page 3, Line 22contributing factor to the high cost of construction and a deterrent for
Page 3, Line 23developers to pursue condominium projects. At the same time,
Page 3, Line 24homeowners have limited up-front assurances of high-quality
Page 4, Line 1construction in new homes. It is critical that policies seek to support homeowners' rights while spurring development in a key housing market.
Page 4, Line 2(e) Without addressing these challenges, Colorado will continue
Page 4, Line 3to experience a shortage of entry-level homes for its first-time
Page 4, Line 4homebuyers and struggle to meet the needs of Coloradans. It is imperative
Page 4, Line 5that the state creates policies that encourage the entire housing ecosystem
Page 4, Line 6to work together to create more attainable housing options for Coloradans.
Page 4, Line 7(f) This act is intended to:
Page 4, Line 8(I) Promote the construction of affordable homes so that
Page 4, Line 9homeownership becomes a more attainable goal for a larger portion of the population;
Page 4, Line 10(II) Expand prospective homeowners' access to high-quality, well-constructed homes;
Page 4, Line 11(III) Ensure continued protections for homeowners when defects in their homes exist;
Page 4, Line 12(IV) Reform construction litigation to reduce the excessive costs associated with entry-level home development;
Page 4, Line 13(V) Strengthen Colorado's housing market by expanding opportunities for first-time homebuyers; and
Page 4, Line 14(VI) Ensure that future generations of Coloradans are able to
Page 4, Line 15access the American dream of homeownership, which is integral to long-term financial security and generational wealth-building; and
Page 4, Line 16(g) This act is rationally related to the legitimate state interest of increasing middle market hosing in Colorado.
Page 4, Line 17SECTION 2. In Colorado Revised Statutes, 13-20-802.5, add
Page 4, Line 18(4.5), (5.5), and (6) as follows:
Page 5, Line 113-20-802.5. Definitions. As used in this part 8, unless the context otherwise requires:
Page 5, Line 2(4.5) "Multifamily construction incentive program" or "program" means the program created in section 13-20-803.3 (1).
Page 5, Line 3(5.5) "Program claim" means all actions for damages,
Page 5, Line 4indemnity, or contribution brought against a construction
Page 5, Line 5professional to assert a claim, counterclaim, cross-claim, or
Page 5, Line 6third-party claim for damages or loss to, or the loss of use of,
Page 5, Line 7real or personal property for which the builder is a participant
Page 5, Line 8in the program or for personal injury caused by a defect in the
Page 5, Line 9design or construction of an improvement to real property for which the builder is a participant in the program.
Page 5, Line 10(6) "Third-party inspection" means a program of
Page 5, Line 11inspections of a residential housing unit performed over the
Page 5, Line 12course of construction on the unit and designed to assist the
Page 5, Line 13construction professional performing the construction on the
Page 5, Line 14unit in identifying and rectifying any instances in which the
Page 5, Line 15work being performed by the construction professional deviates
Page 5, Line 16from applicable building codes or construction standards. The
Page 5, Line 17construction professional who signs the building permit
Page 5, Line 18applicationshall, subsequent to filing the permit application
Page 5, Line 19and prior to the issuance of a certificate of occupancy,certify
Page 5, Line 20in writing filed with the building department that the
Page 5, Line 21third-party inspector was qualified and theinspection complies
Page 5, Line 22with the following requirements for any component, system, or improvement alleged to be defective:
Page 5, Line 23(a) The inspection was performed by either a licensed
Page 6, Line 1construction professional or a building code inspector,
Page 6, Line 2electrical inspector, energy conservation code inspector, fire
Page 6, Line 3code inspector, or mechanical code inspector, if such inspector
Page 6, Line 4provides evidence of successful completion of the most recent
Page 6, Line 5versionof the commercial building inspector examination by the International Code Council or its successor organization:
Page 6, Line 6(I) Who has expertise designing, constructing, or
Page 6, Line 7inspecting the component, system, or improvement being inspected;
Page 6, Line 8(II) (A) Who is an independent third party not otherwise
Page 6, Line 9employed by or affiliated with the construction professional
Page 6, Line 10who was involved in the development, design, or construction of the component, system, or improvement; or
Page 6, Line 11(B) Who is an inspector acting under the direction of an
Page 6, Line 12insurer providing a commercial general liability policy of
Page 6, Line 13insurance purchased to insure the subject residential housing
Page 6, Line 14unit against property damage resulting from defects in the design or construction of the unit;
Page 6, Line 15(III) Who is responsible for performing the inspection duties with a reasonable degree of care; and
Page 6, Line 16(IV) Who is not designated as a nonparty at fault pursuant to section 13-21-111.5 (3)(b); and
Page 6, Line 17(b) The inspection includes, for each component, system,
Page 6, Line 18or improvement, a signed certification that, for each component, system, or improvement,verifies that:
Page 6, Line 19(I) The component, system, or improvement was included
Page 6, Line 20in approved construction documents and specifications,
Page 7, Line 1including addendums issued during construction, under the valid seal of an architect or engineer licensed in Colorado;
Page 7, Line 2(II) (A) Prior to inspection by the building department, the
Page 7, Line 3component, system, or improvement was subject to a field
Page 7, Line 4inspection and approval by the third-party inspector who
Page 7, Line 5certifies that, at the time of inspection, the component, system,
Page 7, Line 6or improvement was sufficiently accessible to determine
Page 7, Line 7compliance with and did comply with applicable manufacturer's
Page 7, Line 8instructions or recommendations, approved construction
Page 7, Line 9documents and specifications, including addendums issued during construction, and the applicable building codes.
Page 7, Line 10(B) If the field inspection does not include every location
Page 7, Line 11where the component, system, or improvement is constructed,
Page 7, Line 12the signed certification must include the permit number; the
Page 7, Line 13date of inspection; the type of inspection; the contractor's name
Page 7, Line 14and license number; the street address of the job location; the
Page 7, Line 15name, address, and telephone number of the inspector who
Page 7, Line 16performed the inspection; and a statement that the inspector
Page 7, Line 17inspected a sufficient number of locations to conclude with a
Page 7, Line 18reasonable degree of certainty that every location of the
Page 7, Line 19component, system, or improvement complies with the applicable
Page 7, Line 20manufacturer's instructions or recommendations, approved
Page 7, Line 21construction documents and specifications, including
Page 7, Line 22addendums issued during construction, and the applicable building codes.
Page 7, Line 23(III) The construction professional successfully repaired
Page 7, Line 24or resolved any instance of noncompliant design or
Page 8, Line 1construction identified during an inspection and that the
Page 8, Line 2component, system, or improvement complies with the
Page 8, Line 3applicable manufacturer's instructions or recommendations and
Page 8, Line 4approved construction documents and specifications, including addendums issued during construction; and
Page 8, Line 5(c) The inspection is not an inspection performed by or on
Page 8, Line 6behalf of a governmental authority having jurisdiction over
Page 8, Line 7the residential housing unit as a condition of any permitting or the issuance of a certificate of occupancy.
Page 8, Line 8SECTION 3. In Colorado Revised Statutes, add 13-20-803.3 as follows:
Page 8, Line 913-20-803.3. Multifamily construction incentive program -
Page 8, Line 10created - construction defect claims against architects and engineers
Page 8, Line 11- statute of limitations - affirmative defenses. (1) The multifamily
Page 8, Line 12construction incentive program is created. On and after
Page 8, Line 13January 1, 2026, a builder of multifamily, attached housing of two or more units may participate in the program by:
Page 8, Line 14(a) Providing a warranty that covers any defect and damage at no cost to the homeowner for a minimum period of:
Page 8, Line 15(I) One year for workmanship and materials;
Page 8, Line 16(II) Two years for plumbing, electrical, and materials; and
Page 8, Line 17(III) Six years for major structural components;
(b) Having a third-party inspection performed; and
Page 8, Line 18(c) Recording a notice of election to participate in the
Page 8, Line 19multifamily construction incentive programin the real
Page 8, Line 20property recordsof the county in which the property is located
Page 9, Line 1for the project intended to be covered before the unit is offered
Page 9, Line 2for sale.After recording a notice of election to participate, a
Page 9, Line 3builder may withdraw from the program only before the issuance of the last certificate of occupancy for the project.
Page 9, Line 4(2) (a) Except as provided in subsection (3) of this section,
Page 9, Line 5a person must file with a complaint a certificate of review in
Page 9, Line 6compliance with section 13-20-602 for a construction defect action that is:
Page 9, Line 7(I) Against a construction professional who is an architect or engineer; and
Page 9, Line 8(II) For a program claim.
Page 9, Line 9(b) The certificate of review filed in accordance with
Page 9, Line 10subsection(2)(a)of this section must, based on facts known to the party filing the certificate of review:
Page 9, Line 11(I) Set forth the architect's or engineer's negligence,
Page 9, Line 12including any act or omission in providing advice, exercising
Page 9, Line 13judgment, giving an opinion, or exercising a similar professional skill; and
Page 9, Line 14(II) Declare that the individual consulted can
Page 9, Line 15demonstrate by competent evidence that, as a result of training,
Page 9, Line 16education, knowledge, and experience, the consultant is
Page 9, Line 17competent to express an opinion as to the negligence, including an act or omission, alleged.
Page 9, Line 18(c) If a claimant fails to file the certificate of review
Page 9, Line 19required in this subsection (2), the court shall dismiss the
Page 9, Line 20complaint against the defendant unless the claimant shows
Page 9, Line 21good cause for the failure.
Page 10, Line 1(3) A claimant is not required to comply with the
Page 10, Line 2certificate of review requirements of subsection (2) of this section if:
Page 10, Line 3(a) A claim is for construction in which a governmental
Page 10, Line 4entity contracted with a single entity to provide both design
Page 10, Line 5and construction services for the construction, rehabilitation,
Page 10, Line 6alteration, or repair of a facility, a building or an associated structure, a civil works project, or a highway project; or
Page 10, Line 7(b) The period of limitation or reposecould reasonably
Page 10, Line 8expire within ten days after the date of filing and, because of
Page 10, Line 9the time constraint, the claimant has alleged that a certificate
Page 10, Line 10of review by a third-party architect or engineer could not be
Page 10, Line 11prepared. A claimant that does not file a certificate of review
Page 10, Line 12under this section shall supplement the complaint with a
Page 10, Line 13certificate of review within twenty-eight days after the filing
Page 10, Line 14of the complaint; except that a court may, on motion and for
Page 10, Line 15good cause, grant a claimant additional time to file the certificate of review.
Page 10, Line 16(4) A defendant that designates an architect or engineer
Page 10, Line 17as a nonparty at fault in accordance with section 13-21-111.5
Page 10, Line 18(3)(b) must file a subsequent certificate of review that complies
Page 10, Line 19with subsection (2) of this section and section 13-20-602. The
Page 10, Line 20defendant shall file a certificate of review at least forty-five
Page 10, Line 21days prior to any trial or proceeding on the claim. If the
Page 10, Line 22defendant fails to file the certificate of review as required in
Page 10, Line 23this subsection (4), a court shall not consider the negligence or
Page 10, Line 24fault of the nonparty.
(5) Subsections (2) to (4) of this section do not:
Page 11, Line 1(a) Extend the applicable period of limitation or repose; or
Page 11, Line 2(b) Apply to a suit or action for the payment of fees arising out of the provision of professional services.
Page 11, Line 3(6) A personal shall not assert a program claim unless the defect hasresulted in one or more of the following:
Page 11, Line 4(a) Actual damage to real or personal property;
(b) Actual loss of the use of real or personal property;
Page 11, Line 5(c) Actual bodily injury or wrongful death;
Page 11, Line 6(d) An unreasonable reduction in the capability of, or an
Page 11, Line 7actual failure of, a building component to perform an intended function or purpose; or
Page 11, Line 8(e) An unreasonable risk of bodily injury or death to, or
Page 11, Line 9a threat to the life, health, or safety of, the occupants of the residential property.
Page 11, Line 11(7) (a) (I) If the defendant is a construction professional
Page 11, Line 12who is not an architect or engineer and who has provided the
Page 11, Line 13claimant a written warranty for the residence that complies
Page 11, Line 14with subsection (1)(a) of this section, and if the claimant
Page 11, Line 15discovered or should have discovered the alleged defect or
Page 11, Line 16damage within the longest applicable warranty period, the
Page 11, Line 17claimant must bring the suit not later than six years after the substantial completion of the improvement.
Page 11, Line 18(II) If the defendant is a construction professional who is
Page 11, Line 19an architect or engineer, and the construction professional
Page 11, Line 20performed in a manner consistent with the degree of skill and
Page 12, Line 1care ordinarily exercised by members of the same profession
Page 12, Line 2currently practicing under the same or similar circumstances,
Page 12, Line 3the claimant must bring the suit not later than six years after the substantial completion of the improvement.
Page 12, Line 4(b) If a claim involves a defect or damage that is covered
Page 12, Line 5by the warranty described in subsection(7)(a)of this section,
Page 12, Line 6the claimant shall pursue allreasonableremedies available
Page 12, Line 7under the warranty process before bringing an action for
Page 12, Line 8damages.The statute of limitations and repose shall be tolled
Page 12, Line 9from the date the claimant first pursued a remedy available
Page 12, Line 10under the warranty for no more than one year or until the completion of the warranty process, whichever is longer.
Page 12, Line 11(c) Section 13-80-104 (2) and (3) applies to the limitation of claims in this subsection (7).
Page 12, Line 12(8) (a) For program claims, a construction professional
Page 12, Line 13who makes areasonable offer pursuant tosubsection (9) of this
Page 12, Line 14sectionmay be immune, in whole or in part, from an obligation,
Page 12, Line 15damage, loss, or liability under this part 8 related to or arising
Page 12, Line 16out of the construction defect, but only with respect to the
Page 12, Line 17portion of the claimant's damages, if any, the construction
Page 12, Line 18professional can demonstrate by a preponderance of the
Page 12, Line 19evidence were proximately caused or increased by an
Page 12, Line 20affirmative defense specified in subsections (8)(b) and (8)(c) of this section and not by the construction defect.
Page 12, Line 21(b) A construction professional is not liablefor a damage
Page 12, Line 22or defect to the extent the professional can prove, as an
Page 12, Line 23affirmative defense, that the damage or defect was caused:
Page 13, Line 1(I) By a weather condition, earthquake, or other natural
Page 13, Line 2phenomenon in excess of the design criteria expressed by the
Page 13, Line 3applicable building codes, regulations, and ordinances in effect at the time of original construction;
Page 13, Line 4(II) By a human-caused event, such as war, terrorism, or vandalism;
Page 13, Line 5(III) By a homeowner's unreasonable failure to timely mitigate damages as required in section 13-20-803.5 (1);
Page 13, Line 6(IV) By the homeowner or the homeowner's agent,
Page 13, Line 7employee, or construction professional by virtue of their
Page 13, Line 8failure to follow the builder's or manufacturer's maintenance
Page 13, Line 9recommendations or to do commonly accepted homeowner
Page 13, Line 10maintenance obligations. In order to rely upon this defense as
Page 13, Line 11it relates to a construction professional's recommended
Page 13, Line 12maintenance schedule, the construction professional must show
Page 13, Line 13that the homeowner had written notice of these maintenance
Page 13, Line 14schedules and recommendations and that the maintenance
Page 13, Line 15recommendations and schedules were reasonable at the time
Page 13, Line 16they were issued and that the damage or defect did not directly
Page 13, Line 17prevent the homeowner from performing the recommended maintenance.
Page 13, Line 18(V) After sale or transfer of ownership to the claimant, by:
Page 13, Line 19(A) The homeowner's or homeowner's agent's alterations;
(B) Ordinary wear and tear;
Page 13, Line 20(C) Misuse of the structure or component;
Page 13, Line 21(D) Abuse of the structure or component;
(E) Neglect of the structure or component; or
Page 14, Line 1(F) The use of the structure or component for something other than the structure's or component's intended purpose.
Page 14, Line 2(c) A construction professional may assert an affirmative defense to the extent that:
Page 14, Line 3(I) The damage was caused by a particular violation
Page 14, Line 4covered by a valid release obtained by the construction
Page 14, Line 5professional, if the release is enforceable against the claimant,
Page 14, Line 6was executed with knowledge of the particular violation, and does not violate section 13-20-806 (7); or
Page 14, Line 7(II) The construction professional's repair completed
Page 14, Line 8pursuant to section 13-20-803.5 (3) was successful in correcting
Page 14, Line 9the particular violation and any damage resulting from the violation of the applicable standard.
Page 14, Line 10(d) The affirmative defenses set forth in this subsection (8)
Page 14, Line 11are in addition to, and shall not limit, impair, replace, or
Page 14, Line 12otherwise affect, any other defense available to a construction professional under statute or common law.
Page 14, Line 13 (9) (a) For program claims,a construction professional
Page 14, Line 14and the insurer, as defined in section 10-1-102 (13), providing
Page 14, Line 15coverage related to the claimshall send or deliver to the
Page 14, Line 16claimant, by certified mail, return receipt requested, or by personal service:
Page 14, Line 17(I) An offer to settle the claim by:
(A) Payment of a sum certain; or
Page 14, Line 18(B) Agreeing to remedy the claimed defect described in
Page 14, Line 19the notice of claim;
(II) A written response that:
Page 15, Line 1(A) Identifies the standards that apply to the claimed defect's construction or performance; and
Page 15, Line 2(B) Explains why the claimed defect does not require repair; or
Page 15, Line 3(III) A written response that explains the construction
Page 15, Line 4professional's scope of work and why the claimed defect is not
Page 15, Line 5within the work and responsibility of the construction professional.
Page 15, Line 6(b) A written offer to remedy a construction defect must
Page 15, Line 7include a report of the scope of the inspection, the findings and
Page 15, Line 8results of the inspection, a description of the additional
Page 15, Line 9construction work necessary to remedy the defect described in
Page 15, Line 10the notice of claim and all damage to the improvement to real
Page 15, Line 11property caused by the defect, and a timetable for the completion of the remedial construction work.
Page 15, Line 12(c) The construction professional shall provide an offer
Page 15, Line 13pursuant to subsection (9)(a)(I) of this section within ninety days
Page 15, Line 14after the deadline to inspect the property and claimed defect
Page 15, Line 15pursuant to section 13-20-803.5 or a written response pursuant
Page 15, Line 16to subsection (9)(a)(II) or (9)(a)(III) of this section within thirty
Page 15, Line 17days after the deadline to inspect the property and claimed
Page 15, Line 18defect pursuant to section 13-20-803.5. Notwithstanding any
Page 15, Line 19provision in a contract or any requirement in the governing
Page 15, Line 20documents, if a construction professional requests an extension
Page 15, Line 21to provide an offer pursuant to subsection (9)(a)(I) of this
Page 15, Line 22section and the claimant does not agree to the requested
Page 16, Line 1extension, the parties shall designate a mutually agreeable
Page 16, Line 2third party in writing to determine whether the requested
Page 16, Line 3extension is reasonable. Notwithstanding any other provision
Page 16, Line 4in this section, the total time to provide an offer must not
Page 16, Line 5exceed two hundred ten days after the date of the notice of
Page 16, Line 6claim by the construction professional providing an offer pursuant to subsection (9)(a)(I) of this section.
Page 16, Line 7(d) If a claimant unreasonably rejects a reasonable
Page 16, Line 8written offer of settlement made pursuant to this subsection (9)
Page 16, Line 9and subsequently commences an action against the
Page 16, Line 10construction professional, the court may award attorney fees and costs to the construction professional.
Page 16, Line 11(e) If a construction professional fails to make a
Page 16, Line 12reasonable written offer of settlement pursuant to this
Page 16, Line 13subsection (9), the limitations on damages and defenses to
Page 16, Line 14liability provided in subsections (2), (5), (6), (7), and (8) of this
Page 16, Line 15section do not apply, and the court may award attorney fees and costs to the claimant.
Page 16, Line 16(f) (I) A construction professional's written offer of
Page 16, Line 17settlement is reasonable, and a claimant's rejection of the offer
Page 16, Line 18is unreasonable, if the claimant recovers a final judgment in an
Page 16, Line 19amount that is less than the amount offered or the reasonable value of the repair offered by the construction professional.
Page 16, Line 20(II) A construction professional's written offer of
Page 16, Line 21settlement is unreasonable, and a claimant's rejection of the
Page 16, Line 22offer is reasonable, if the claimant recovers a final judgment in
Page 16, Line 23an amount that exceeds the amount offered or the reasonable value of the repair offered by the construction professional.
Page 17, Line 1(10) (a) Within thirty days after the rejection of an offer
Page 17, Line 2made pursuant to subsection (9) of this section, a claimant shall
Page 17, Line 3provide a construction professional with a written proposal to
Page 17, Line 4have the construction defect repaired at the construction professional's expense or to settle the claim.
Page 17, Line 5(b) If the construction professional does not accept the
Page 17, Line 6proposal provided by the claimant pursuant to subsection (10)(a)
Page 17, Line 7of this section in writing within fifteen days after delivery of the proposal, the proposal is deemed to have been rejected.
Page 17, Line 8(c) If the construction professional accepts the proposal
Page 17, Line 9provided by the claimant pursuant to subsection (10)(a) of this
Page 17, Line 10section, the construction professional shall pay the claimant's
Page 17, Line 11reasonable attorney fees and costs incurred in investigating the defect and proposing the repair.
Page 17, Line 12(11) Nothing in this section:
Page 17, Line 13(a) Affects the "Colorado Governmental Immunity Act", article 10 of title 24, or section 13-20-806 (7); or
Page 17, Line 14(b) Prohibits, limits, or impairs a contractual claim or expands the definition of "action" in section 13-20-802.5 (1).
Page 17, Line 15SECTION 4. In Colorado Revised Statutes, 13-20-803.5, amend (1), (3), (7), and (12); and add(3.5), (3.7), and (13) as follows:
Page 17, Line 1613-20-803.5. Notice of claim process - duty to mitigate.
Page 17, Line 17(1) (a) No later than seventy-five days before filing an action against a
Page 17, Line 18construction professional, or no later than ninety days before filing the
Page 17, Line 19action in the case of a commercial property, a claimant shall send or
Page 17, Line 20deliver a written notice of claim to the construction professional by certified mail, return receipt requested, or by personal service.
Page 18, Line 1(b) Before filing a claim pursuant to this subsection (1)
Page 18, Line 2for program claims,a claimant shall mitigate the damage
Page 18, Line 3caused by the alleged construction defect. A claimant satisfies
Page 18, Line 4the duty to mitigate by taking reasonable action to prevent
Page 18, Line 5further damage from the construction defect. A claimant must
Page 18, Line 6certify in the complaint that the claimant has satisfied the duty to mitigate.
Page 18, Line 7(c) If the claimant and construction professional dispute
Page 18, Line 8whether the claimant has satisfied the duty to mitigate
Page 18, Line 9described in subsection (1)(b) of this section, the claimant may
Page 18, Line 10proceed with the action but does not recover any damages that
Page 18, Line 11the construction professional proves were caused by the claimant's unreasonable failure to mitigate.
Page 18, Line 12(d) A claimant does not breach the duty to mitigate if the
Page 18, Line 13cost to mitigate is unreasonable under the circumstances or was beyond the claimant's financial ability to perform.
Page 18, Line 15(3) Except as provided in section 13-20-803.3 (9), within thirty
Page 18, Line 16days
followingPage 18, Line 17pursuant to subsection (2) of this section, or within forty-five days
Page 18, Line 18
followingPage 18, Line 19a commercial property, a construction professional may send or deliver
Page 18, Line 20to the claimant, by certified mail, return receipt requested, or personal
Page 18, Line 21service, an offer to settle the claim by payment of a sum certain or by
Page 18, Line 22agreeing to remedy the claimed defect described in the notice of claim. A
Page 18, Line 23written offer to remedy the construction defect shall include a report of
Page 19, Line 1the scope of the inspection, the findings and results of the inspection, a
Page 19, Line 2description of the additional construction work necessary to remedy the
Page 19, Line 3defect described in the notice of claim and all damage to the improvement
Page 19, Line 4to real property caused by the defect, and a timetable for the completion of the remedial construction work.
Page 19, Line 5(3.5) (a) By the earlier of when a construction
Page 19, Line 6professional, other than an architect or engineer, offers to
Page 19, Line 7settle a claim or sixty days after a construction professional
Page 19, Line 8receives actual notice of claim, the construction professional
Page 19, Line 9shall provide the claimant with the following documents and
Page 19, Line 10information, to the extent the documents and information are
Page 19, Line 11within the construction professional's possession, custody, or control:
Page 19, Line 12(I) Copies of all plans, specifications, and soil reports related to the claim;
Page 19, Line 13(II) Maintenance and preventive maintenance recommendations related to the claim;
Page 19, Line 14(III) The name, last-known address, and scope of work of
Page 19, Line 15each construction professional who contracted to perform
Page 19, Line 16work or provide services and did perform work or provide services related to the claim;
Page 19, Line 17(IV) All documents related to the third-party inspection
Page 19, Line 18of the property and the name and last-known address of the inspector who performed the third-party inspection; and
Page 19, Line 19(V) Copies of each insurance policy purchased by the
Page 19, Line 20construction professional and related to the claim through the
Page 19, Line 21date of the notice of claim and from the earlier start date of:
Page 20, Line 1(A) The date the construction of the alleged defect was substantially completed; or
Page 20, Line 2(B) The date the construction professional substantially completed work on the alleged defect.
Page 20, Line 3(b) A construction professional may charge reasonable
Page 20, Line 4copying costs for the documents described in subsections(3.5)(a)(I), (3.5)(a)(II), (3.5)(a)(IV), and (3.5)(a)(V)of this section.
Page 20, Line 5(c) Failure to provide the identifying information
Page 20, Line 6required in subsection (3.5)(a)(III) of this section by the
Page 20, Line 7applicable deadline for designating a nonparty at fault bars the
Page 20, Line 8construction professional from designating the unidentified
Page 20, Line 9construction professional as a nonparty at fault under section
Page 20, Line 1013-21-111.5 (3)(b) in a subsequent action. If the construction
Page 20, Line 11professional fails to provide the information required in
Page 20, Line 12subsection (3.5)(a)(I) of this section, the claimant need not
Page 20, Line 13comply with the certificate of review requirement in section 13-20-803.3 (2).
Page 20, Line 14(3.7) (a) By the earlier of when a construction
Page 20, Line 15professional who is an architect or engineer offers to settle a
Page 20, Line 16claim or sixty days after a construction professional receives
Page 20, Line 17actual notice of claim, the architect or engineer shall provide
Page 20, Line 18the claimant with the following documents and information, to
Page 20, Line 19the extent the documents and information are within the architect's or engineer's possession, custody, or control:
Page 20, Line 20(I) Copies of all approved construction documents and
Page 20, Line 21specifications, including addendums issued during construction,
Page 20, Line 22prepared by the architect, engineer, or consultants;
Page 21, Line 1(II) The name, last-known address, and scope of work of
Page 21, Line 2each architect or engineer who performed work or provided
Page 21, Line 3services as a consultant related to the claim and on the claimant's property; and
Page 21, Line 4(III) Copies of each insurance policy purchased by the
Page 21, Line 5architect or engineer and related to the claim through the date of the notice of claim and from the earlier start date of:
Page 21, Line 6(A) The date the construction of the alleged defect was substantially completed; or
Page 21, Line 7(B) The date the architects and engineers substantially completed work related to the alleged defect.
Page 21, Line 8(b) An architect or engineer may charge reasonable
Page 21, Line 9copying costs for the documents described in subsection (3.7)(a) of this section.
Page 21, Line 11(7) If an offer by a construction professional is made and accepted
Page 21, Line 12or if a proposal made by a claimant is accepted, and if thereafter the
Page 21, Line 13construction professional does not comply with
itsPage 21, Line 14or settle a claim for a construction defect or with the claimant's
Page 21, Line 15proposal, the claimant may file an action against the construction
Page 21, Line 16professional for claims arising out of the defect or damage described in the notice of claim without further notice.
Page 21, Line 17(12) Except as provided in this section and section
Page 21, Line 1813-20-806, a claimant shall not recover more than actual damages in an action.
Page 21, Line 20(13) An insurer, as defined in section 10-1-102(13),shall
Page 22, Line 1notcancel, deny, or reduce coverage based on any claim for
Page 22, Line 2benefits covered by an existingliability insurance policy issued
Page 22, Line 3to a construction professional based on the construction
Page 22, Line 4professional making an offer to repair or settle a construction
Page 22, Line 5defect claim pursuant to this section. Any settlement or repair agreement that affects coverage is subject to insurer approval.
Page 22, Line 6SECTION 5. In Colorado Revised Statutes, amend 13-20-805 as follows:
Page 22, Line 713-20-805. Tolling of statutes of limitation. (1) If a notice of
Page 22, Line 8claim is sent to a construction professional in accordance with section
Page 22, Line 913-20-803.5 within the time prescribed for the filing of an action under
Page 22, Line 10
anyPage 22, Line 11limitations or repose is tolled until sixty days after the completion of the notice of claim process described in section 13-20-803.5.
Page 22, Line 12(2) If an alleged construction defect is being mitigated
Page 22, Line 13pursuant to subsection 13-20-803.5, the statute of limitations or
Page 22, Line 14repose is tolled for the duration of the mitigation; except that
Page 22, Line 15the maximum length of tolling under this subsection (2) cannot exceed one year.
Page 22, Line 16(3) The tolling of the statute of limitations or repose
Page 22, Line 17under subsection (1) or (2) of this section does not preclude the
Page 22, Line 18tolling of the statute of limitations or repose under the other subsection of this section.
Page 22, Line 20SECTION 6. In Colorado Revised Statutes, 38-33.3-303.5,
Page 22, Line 21amend (1)(d)(I)(A) and (1)(d)(III) introductory portion; and add (5) as
Page 22, Line 22follows:
Page 23, Line 138-33.3-303.5. Construction defect actions - disclosure -
Page 23, Line 2approval by unit owners - definitions - exemptions. (1) (d) Approval
Page 23, Line 3by unit owners - procedures. (I) (A) Notwithstanding any provision of
Page 23, Line 4law or any requirement in the governing documents, the executive board
Page 23, Line 5
maytheonlyPage 23, Line 6authorized within the voting period by owners of units to which
aPage 23, Line 7
majorityPage 23, Line 8allocated.
SuchPage 23, Line 9with a construction defect action if the alleged construction defect
Page 23, Line 10pertains to a facility that is intended and used for nonresidential purposes
Page 23, Line 11and if the cost to repair the alleged defect does not exceed fifty thousand
Page 23, Line 12dollars.
SuchPage 23, Line 13with a construction defect action when the association is the contracting party for the performance of labor or purchase of services or materials.
Page 23, Line 14(III) Vote count - exclusions. For purposes of calculating the
Page 23, Line 15required
majorityPage 23, Line 16(5) An executive board that is successful under a
Page 23, Line 17construction defect claim or settlement shall first use net
Page 23, Line 18monetary damages ornetproceeds received pursuant to the claim to repair the construction defect.
Page 23, Line 19SECTION 7. In Colorado Revised Statutes, 29-32-105, amend (2)(a) as follows:
Page 23, Line 2029-32-105. Affordable housing commitments - local
Page 23, Line 21governments - tribal governments - three-year commitment cycle -
Page 23, Line 22expedited development approval process - eligibility for assistance
Page 23, Line 23from the fund. (2) (a) In order to receive financial assistance under this
Page 24, Line 1
articlePage 24, Line 2government, municipality, a city and county, or the unincorporated area
Page 24, Line 3of a county to be eligible for funding, the tribal government or local
Page 24, Line 4government, other than a local affordable housing authority, must
Page 24, Line 5establish processes to enable it to provide a final decision on any
Page 24, Line 6application for a special permit, variance, or other development permit,
Page 24, Line 7including a for-sale multifamily condominium project and
Page 24, Line 8excluding subdivisions, of a development project, for which fifty percent
Page 24, Line 9or more of the residential units in the development constitute affordable
Page 24, Line 10housing not more than ninety calendar days after submission of a complete application, referred to herein as a "fast-track approval process.
Page 24, Line 11SECTION 8. Act subject to petition - effective date -
Page 24, Line 12applicability. (1) This act takes effect at 12:01 a.m. on the day following
Page 24, Line 13the expiration of the ninety-day period after final adjournment of the
Page 24, Line 14general assembly; except that, if a referendum petition is filed pursuant
Page 24, Line 15to section 1 (3) of article V of the state constitution against this act or an
Page 24, Line 16item, section, or part of this act within such period, then the act, item,
Page 24, Line 17section, or part will not take effect unless approved by the people at the
Page 24, Line 18general election to be held in November 2026 and, in such case, will take
Page 24, Line 19effect on the date of the official declaration of the vote thereon by the governor.
Page 24, Line 20(2) This act applies to construction defect claims brought on or after the applicable effective date of this act.