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DEPARTMENT OF REGULATORY AGENCIES
DIVISION OF REAL ESTATE
SUBDIVISIONS
4 CCR 725-6

NOTICE OF PROPOSED PERMANENT RULEMAKING HEARING
December 2, 2014

CHAPTER 4:	MISCELLANEOUS PROVISIONS, ADDITIONAL INFORMATION

Pursuant to and in compliance with Title 12, Article 61 and Title 24, Article 4, C.R.S. as amended, notice of proposed rulemaking is hereby given, including notice to the Attorney General of the State of Colorado and to all persons who have requested to be advised of the intention of the Colorado Real Estate Commission (the “Commission”) to promulgate rules, or to amend, repeal or repeal and re-enact the present rules of the Commission.

STATEMENT OF BASIS

The statutory basis for the rules titled Rules and Regulations for Subdivision Developers is Part 4 of Title 12, Article 61, Colorado Revised Statutes, as amended.  

STATEMENT OF PURPOSE

The purpose of this rule is to effectuate the legislative directive to promulgate necessary and appropriate rules in conformity with the state statutes concerning Subdivisions.

SPECIFIC PURPOSE OF THIS RULEMAKING

The purpose of this rule is to amend or repeal existing rules with respect to any additional and supplemental information required for subdivisions and to ensure that subdivision developers are familiar with all current regulations.

Proposed New, Amended and Repealed Rules

[Deleted material is shown struck through; new material is shown ALL CAPS.] Rules, or portions of rules, which are unaffected are reproduced.  Readers are advised to obtain a copy of the complete rules of the Commission at www.dora.state.co.us/real-estate/.

Chapter 4:	Miscellaneous Provisions, Additional Information

4.1	All approvals for the use of reservation agreements issued pursuant to §12-61-402(2), C.R.S., will expire on December 31st following the date of issuance. Approval will be renewed, except as provided in section §12-61-405, C.R.S., by payment of a renewal fee established pursuant to section §12-61-111.5, C.R.S., and upon submission and acceptance of a renewal application.

4.2	Upon request of the Commission pursuant to an investigation, a developer will file with the  Commission an audited financial statement in conformity with accepted accounting principles, and sworn to by the developer as an accurate reflection of the financial condition of the developer and/or the homeowners’ association controlled by the developer.

4.3	Any adverse order, judgment, or decree entered in connection with the subdivided lands by any regulatory authority or by any court of appropriate jurisdiction must be filed with the Commission by the developer within thirty (30) calendar days of such order, judgment or decree being final.

4.4	A developer is not required to file amendments to its registration filed with the Commission when revisions are made to documents previously submitted to the Commission, so long as the revised documents continue to: (a) comply with Title 12, Article 61, Part 4, C.R.S., and the rules and regulations promulgated thereunder; and (b) accurately reflect the subdivision offering.
4.5        Notice of Events:

       a.     Notwithstanding Rules 4.3 and 4.4 above, and in addition to the notice requirements under Rule 1.6, developer must provide the Commission with notice of the following events within ten (10) calendar days after such event, unless otherwise provided below:

                 1.   	Any change in the information provided in the registration pursuant to Sections §12-61 403(2)(a)(iv), (vi), (vii) or (viii), C.R.S.;
                 2.		Any change in the terms of any non-disturbance agreement(s) or partial release provisions in connection with any documents previously submitted to the Commission pursuant to section §12-61-403(3)(e), C.R.S., and Rule 2.2(d);
                 3.		Any new lien encumbering the subdivision or any part thereof other than encumbrances created or permitted by purchasers;
                 4.		The termination or transfer of any escrow account, letter of credit, bond, or other financial assurance approved by the Commission pursuant to Rule 2.3; notice of which must be filed with the Commission prior to the effective date of such termination or transfer;
                 5.		Cancellation, revocation, suspension, or termination of the developer’s activity or authority to do business in the State of Colorado; and
                 6.		Any lis pendens, lawsuit or other proceeding filed against the subdivision or developer affecting the developer’s ability: (a) to convey marketable title of the registered subdivision or any interest therein, or (b) to perform the developer’s obligations in connection with the registered subdivision.

b.	Notification under this rule must be provided on a form approved by the Commission. The developer will have a period of ten (10) calendar days after receipt of notice to take such action as may be required by the Commission in connection with any filings made under this rule. 
c.	Within ten (10) calendar days after receipt of a written request from the Commission, a developer will have the duty to provide to the Commission copies of all documents then in use with regard to the subdivision.

4.6	No developer will make misrepresentations regarding the future availability or costs of services, utilities, character, or use of real property for sale or lease of the surrounding area of the subdivision.

4.7	Delivery of Deed:

             a. 	Unless a sale is by means of an installment contract, the delivery of a deed must be made within sixty (60) calendar days after closing. For the purposes of this rule, the date of closing is defined as the date the purchaser has either paid the full cash purchase price or has made partial cash payment and executed a promissory note or other evidence of indebtedness for the balance of the purchase price. (This must be disclosed in the contract.)
b.	If a sale is by means of an installment contract, the delivery of a deed must be made within sixty (60) calendar days after the completion of payments. 

4.8	Where the sales contract contemplates the delivery of a deed, an abstract of title or title insurance policy must be delivered within a reasonable time after the completion of payments by a purchaser. Any period of time exceeding sixty (60) calendar days will be deemed unreasonable for the purposes of this rule. The parties may contract to eliminate this requirement, but any such mutually acceptable waiver must be in writing and in a conspicuous manner or print. The presence of waiver on the back of a contract will not be deemed conspicuous for the purposes of this rule.

4.9	Developer must provide a title insurance commitment or other evidence of title approved by the Commission within a reasonable time after execution of any lease, sales contract or other instrument purporting to convey any interest in the site, tract, lot, divided or undivided interest from a subdivision. Any period of time in excess of sixty (60) calendar days will be deemed unreasonable for the purposes of this rule. The parties may contract to eliminate this requirement, but any such mutually acceptable waiver must be in writing and in a conspicuous manner or print. The presence of waiver on the back of a contract will not be deemed conspicuous for the purposes of this rule.

4.10	Failure to disclose to the purchaser the availability of legal access, sewage disposal, public utilities, including water, electricity, gas and telephone facilities, in the subdivision offered for sale or lease, including whether such are to be a developer or purchaser expense, when proven, is a violation of §12-61-405(1)(b), C.R.S.

4.11	Pursuant to §12-61-405(1)(e), C.R.S., §12-61-406(2.5)(b), C.R.S., and §12-61-406(4), C.R.S., a developer must maintain in a Colorado place of business, and produce for inspection upon reasonable request by an authorized representative of the Commission copies of the following documents and business records:

a.	The sales contract, transfer or lease agreement, installment sale agreement, financing agreement, buyer and seller settlement statement, title policy or commitment, trust deed, escrow agreement, and any other documents executed by the parties or on behalf of the developer in the sale, lease or transfer of any interest in a subdivision.
b.	Records showing the receipt and disbursement of any money or assets received or paid on behalf of any homeowners’ or similar association managed or controlled by a developer.