The Big Question About Big Projects

Imagine your condo building needs a brand new roof. A project like this often comes with a hefty price tag that homeowners will have to pay, either out of reserves or through a special assessment. The management committee, however, is ultimately responsible for selecting the right contractor, which raises questions about how decisions are made and what rights homeowners have if they disagree with the management committee’s decision. 

The Condominium Ownership Act provides clear rules for these situations. These laws help the management committee and the residents. The goal is to make life easier for the community. By following the law, a community can stay in good shape and use its financial resources wisely.

Why Boards Talk About Bids Privately

Most meetings of the management committee must stay open to everyone. This lets you see how the HOA spends your money. But there is an exception for contract deals. Section 57-8-57(3)(b)(iv) of the Condominium Ownership Act allows the board to meet behind closed doors to review a bid or a proposal from a contractor.

This privacy is a tool for confidentiality, practicality, and fiscal responsibility. It is the board's duty to act on behalf of the HOA. If the management committee had to review all bids or conduct all negotiations in an open meeting with the members, it would be nearly impossible for the board to act. Private talks help the management committee negotiate the best value and keep the process moving, so the law allows them to do so in private. 

However, once the board is ready to approve a final bid and sign a contract, Section 57-8-57(1) usually requires them to do so at an open meeting. If the members strongly object to the contract, the management committee must provide them with a reasonable opportunity to speak, after which the board can decide to proceed as planned, reevaluate, or seek additional bids.

Breaking Free from Developer Deals

Developers often sign long contracts before the owners take over. This happens during the period of administrative control. But what if the community wants to change one of these contracts?

According to Section 57-8-39(2)(a) of the Condominium Ownership Act, a contract that the developer signs on behalf of the HOA is binding beyond the period of administrative control, unless the management committee decides to terminate it. 

This law generally applies to services for:

• Garbage collection;
• Lawn care and snow removal; or
• General maintenance.

The law, however, does not apply to golf courses, amenity management, utilities, cable services, and other services that require a significant investment in infrastructure or capital.

The Right to Choose Your Own Contractor

Rules for contracts do not just apply to the whole building. They apply to unit owners, too. A unit owner might want to hire help for their own space. The HOA has limited control over this. According to Section 57-8-8.1(13)(b)(ii), they cannot force you to use a specific contractor, whether or not that contractor is on a preferred vendor list. They also can’t prohibit you from using someone who does not have a professional license, unless the license is required by law.

Protecting Your Community - and Your Home - From Construction Fraud

In 2025, the Utah Department of Commerce launched the Residential Construction Fraud Task Force to combat the growing trend of construction fraud in the state. The HOA Ombudsman Office sits on this task force alongside the Division of Professional Licensure, the Division of Consumer Protection, members of the Attorney General’s office, and other industry leaders to ensure the specific needs of condo and community associations are included in any future policy proposals.

Be sure you and your community are not the next victims of construction fraud by following these steps before hiring a contractor:

1. Prepare plans with an architect or interior designer, if necessary.
2. Get several bids.
3. Always ask for references (a minimum of 3 for each contractor is recommended).
4. Verify the contractor’s license with the Division of Professional Licensure.
5. Check whether the contractor is listed on the Buyer Beware List with the Division of Consumer Protection. This list identifies individuals or businesses that have violated the law, failed to comply with an order, or breached a settlement agreement or other stipulation with the Division.
6. Get a thorough written contract. The contract should include the exact work to be done, the contract price, the project beginning and end dates, permit procurement, and a guarantee of liability coverage.
7. Be cautious of requests for large down payments. Payments should be made as work is completed. Never pay in cash.
8. Monitor progress by regularly checking in with the contractor, including confirming whether all required building permits have been obtained. These permits should be provided or displayed on the job site.
9. Before submitting a final payment, make sure your contract has obtained a signed lien release from all suppliers and subcontractors. You can check the status of liens on your home at SCR.utah.gov.