In the wake of Surfside, some South Florida’s condominium associations cannot find lenders willing to lend for capital projects or to potential buyers. It’s doubtful South Florida’s condominium associations that restored, rehabilitated, and stabilized their operation can ever leave the list.
For more information:
Fannie Mae, Freddie Mac Keep Secret “Blacklist” of Properties (therealdeal.com)
–By Joshua Gerstin, Esq.
If you own a condominium in Florida, it is important to be aware of the significant cost increases condominium owners will face due to recent changes in Florida law and ever-increasing insurance premiums. In particular, the new Structural Integrity Law, with its mandated increases in reserve requirements and the skyrocketing cost of insurance, will cause many Florida condominium owners to sell their units and many condominium associations to pursue termination of their condominium associations.
The Structural Integrity Law was passed in response to the collapse of the Champlain Towers South condominium building in Surfside, Florida, in June 2021. The law requires all condominium associations in Florida to complete a structural inspection by a qualified engineer or architect and a reserve study by the end of 2021. Condominium associations are required to make any necessary repairs identified in the inspection.
The cost of the required inspections, reserve study and repairs can be significant. According to estimates from the Community Associations Institute, the cost of a structural inspection alone can range from $10,000 to $50,000 or more, depending on the size and complexity of the building. Repairs identified in the inspection can cost millions of dollars, and may require assessments or increases in monthly assessments to cover the costs.
In addition to the costs associated with the Structural Integrity Law, Florida condominium owners will also face increases in reserve requirements. The Structural integrity law prohibits the pooling of reserves for certain designated items or items identified as in need of repair by the structural inspection. Additionally, the law also removed the ability of condominium associations to partially fund or waive full funding of reserves.
The increase in reserve requirements will likely result in higher monthly assessments for condominium owners in associations that routinely chose not to fully fund their reserves. Condominium associations may need to levy special assessments to make up for any shortfall in reserve funds. These assessments can be a significant burden on condominium owners, particularly those who are already struggling financially.
Finally, condominium owners in Florida can expect to see exponential increases in their insurance premiums. Insurance companies are raising rates for condominium associations in response to the Champlain Towers South collapse and the resulting scrutiny of building safety and maintenance practices.
The new Structural Integrity Law, along with increases in reserve requirements and insurance premiums, will have a significant impact on the costs of owning a condominium in Florida. Condominium associations have options to mitigate these issues, but they have to act fast by taking steps NOW to ensure their condominium associations remain financially stable with a safe and secure living environment for their residents.
Another big year for legislation impacting Florida’s community associations. Now is the time for associations to contact their attorneys for guidance. The following items will become law on July 1, 2021, unless vetoed by the Governor. Following is a summary of the highlights. For complete coverage, please click on the various links below to see the bill’s entire text:
1. **Collections have changed. See below for important information. Similar to homeowner associations. Condominium association collections require two forty-five-day notices from an attorney compared to the prior two thirty-day notices (SB 56available by clicking here).
2. Renters have the right to inspect and copy only the declaration of condominium, by-laws, and rules.
3. Requiring members to demonstrate any purpose or state any reason for a record inspection is prohibited.
4. Documents required to be posted on a website can be made available via a mobile application (applies only to condominiums with 150 or more units).
5. For condominiums with 150 or more units, instead of posting copies of certain required documents to a website, the association may make those documents available through an application on a mobile device.
6. Discriminatory restrictions in governing documents (e.g., restrictions pertaining to race, color, national origin, religion, gender, or disability) can be amended by the Board without the necessity of a vote by the members.
7. Board member term limits are clarified as beginning on or after July 1, 2018.
8. If condominium association policies do not allow for subrogation against an owner, an owner’s policy cannot allow for subrogation against an association. This bill may have unintended and expensive consequences in the form of higher insurance rates if association insurers cannot recoup losses against a negligent owner.
9. Bids have to be maintained by an association for only one year.
10. Transfer fee maximum amount is increased from $100.00 to $150.00 and will have a CPI adjustment every five years.
11. Recall disputes may go directly to court or arbitration, mediation is no longer an option.
12. Contracts with a service provider owned or operated by a board member (or other relatives with a financial relationship) are no longer prohibited.
13. Associations cannot prohibit the installation of a natural gas fuel station. However, the installation must comply with all federal, state, and local laws.
14. An association can install, operate and charge for an electric vehicle charging station or natural gas fuel station on the common elements or association property. The installation of an electric vehicle charging station or natural gas fuel station will not constitute a material alteration or substantial addition to the common elements or association property.
15. The Division now has jurisdiction to investigate complaints related to association records.
16. Fines are due five days after notice to the violator compared to five days after the Fining Committee approved the fine.
17. Based on the advice of emergency management officials, licensed professionals retained by the association or public health officials, the Board may limit entry or occupancy of any portion of the condominium or association property to protect the health, safety, and/or welfare of the members, tenants, guests, and invitees.
18. During an emergency, the Board may use heightened sanitation protocols and remove debris to mitigate the spread of fungus, mold, or a contagion. In addition, the Board may contract for services or items that assist with the mitigation of damage, further injury, or the spreading of a contagion.
19. Emergency powers are limited to only the amount of time reasonably necessary to protect the health, safety, and/or welfare of members, guests, and invitees, mitigate further damage or injury or make necessary repairs.
20. An association no longer has to wait for a problem to occur. Emergency powers can be used in response to anticipated damage or injury. The term “contagion” was added to the types of emergencies.
21. An association’s emergency powers cannot be used to prohibit owners, tenants, guests, agents, or their invitees from accessing a unit, common elements, and limited common elements if access is necessary to facilitate the sale, lease, or transfer of title to the unit.
22. In response to a records request, condominium associations must provide the owner a certified and itemized list of records produced.
23. Fourteen days’ notice is required for all member meeting notices unless other stated in the association’s by-laws.
24. Service provider conflict of interest provisions have been deleted.
25. Fines are due 5 (five) days after notice from the association.
26. Unpaid fines are no longer considered a type of financial delinquency that would bar an owner from becoming a candidate for a directorship (SB 1966, available by clicking here).
1. **Collections have changed. See below for important information.
2. Similar to condominium associations, amendments to homeowner association governing documents that prohibit or regulate rentals will apply only to owners acquiring title after the amendment is passed or to the existing owners that consent. Rental restrictions in a governing document amendment will not apply to owners that do not vote on the amendment or that vote no. Instead, the rental restrictions would apply only after the home is sold. A home transferred to an affiliated entity in which the beneficial ownership remains the same, or a home devised (transferred) through a will, does not give rise to the imposition of a rental restriction amendment. This new law does not apply to governing document amendments seeking to prohibit or regulate rentals for terms of less than six (6) months or seek to limit rentals to no more than three times a year. The new law also does not apply to a homeowners’ association with less than sixteen homes.
3. Records or other information obtained by a community association when a guest visits an owner or resident (security check at gated communities, etc.) are not accessible to members.
4. Rules & Regulations are no longer included in the definition of “governing documents.” The inclusion of Rules and Regulations in the definition was the reason homeowner associations started recording them. Considering the flip-flop nature of the legislature and that most Rules and Regulations have now been recorded, continuing to record new Rules and Regulations makes sense.
5. Sign-in sheets, ballots, voting proxies, and all other records pertaining to parcel owners’ voting must be maintained for one year after the vote.
6. If governing documents do not obligate the developer to create reserves, no reserves are accounted for in the budget, and the association is responsible for the repair and maintenance of
capital improvements for which a special assessment may be necessary, financial reports for the preceding year must contain disclosure language in conspicuous type.
7. Reserves are to be considered mandatory only if the governing documents obligated the developer to provide reserves or the reserve(s) are approved by a majority of the association’s total voting interests.
1. **Collections SB 56 (available by clicking here):
An association may not require payment of attorney fees related to a past due assessment without first delivering a written notice of late assessment to the unit owner which specifies the amount owed to the association and provides the unit owner an opportunity to pay the amount owed without the assessment of attorney fees. The notice of late assessment must be sent by first-class United States mail to the unit owner at his or her last address as reflected in the association’s records and, if such address is not the unit address, must also be sent by first-class United States mail to the unit address. Notice is deemed to have been delivered upon mailing as required by this subsection. A rebuttable presumption that an association mailed a notice in accordance with this subsection is established if a board member, officer, or agent of the association, or a manager licensed under part VIII of chapter 346 468, provides a sworn affidavit attesting to such mailing. The notice must be in substantially the following form:
NOTICE OF LATE ASSESSMENT
RE: Unit …. of …(name of association)…
The following amounts are currently due on your account to …(name of association)…, and must be paid within 30 days of the date of this letter. This letter shall serve as the association’s notice of its intent to proceed with further collection action against your property no sooner than 30 days of the date of this letter, unless you pay in full the amounts set forth below:
Maintenance due …(dates)… $…..
Late fee, if applicable $…..
Interest through …(dates)…* $…..
TOTAL OUTSTANDING $…..
*Interest accrues at the rate of …. percent per annum.
2. Covid-19. SB 72 (available by clicking here). If community associations follow safety guidelines properly, they may be immune to COVID-19 related lawsuits. The hurdles for a plaintiff to prove a COVID-19 infection was the fault of an association are sharply increased.
April 29, 2020 (Click here for .pdf version)
As state and local governments begin gradually easing their lock down and coronavirus related restrictions, community associations are struggling to decide when and how to start reopening their community pools and tennis/pickleball courts. In doing so, each community association is going to have to strictly follow a patchwork of federal, state and sometimes local/city restrictions and guidelines.
There is no need to rush, there are no federal, state or local mandates requiring community associations to open their pools and tennis/pickleball courts. In fact, as long as the federal or state emergency declarations remain in place, community associations can decide to keep their pools and tennis/pickleball courts closed. For some community associations, the governmental requirements to open their pools and tennis/pickleball courts will be too costly or impractical at this point to consider.
The first step to determine the guidelines for opening your community association’s pool and tennis/pickleball court is to locate the state, county and local/city emergency orders governing your community association. The best place to locate the most up to date state, county and local/city emergency orders is at: https://covid-19.lobbytools.com/. For your convenience, I posted the emergency orders pertaining to community association pools and tennis/pickleball courts for Broward County (click here) and Palm Beach County (click here). We are also expecting an order from the governor today as well.
Each community association should review the orders governing their location with the assistance of their attorney. In doing so, you may notice some governmental orders conflict. For example, a city a may require an extra precaution not required by the county. In such, instances, you should check with your attorney before proceeding. As a general rule, the more restrictive requirement should be followed.
Following are some highlights from the Palm Beach County and Broward County emergency orders pertaining to the opening of pools and tennis/pickleball courts:
Continued adherence of CDC guidelines, including while in the pool, is required. Community associations are responsible for ensuring compliance. Therefore, if members violate the guidelines both the member and the association could be fined. The CDC guidelines for social distancing can be found here:
https://www.cdc.gov/coronavirus/2019-ncov/prevent-getting-sick/social-distancing.html
A. Tennis Courts: Tennis and outdoor racquet facilities shall reopen provided that CDC Guidelines, including all social distancing guidelines, are adhered to. In addition, the following restrictions shall apply:
1. Singles play only is permitted. No congregating on the court or sidelines is permitted.
2. Locker room and shower facilities shall remain closed. Restrooms must be cleaned and disinfected regularly throughout the day. Soap and water or hand sanitizer and/or disinfectant wipes shall be provided in each restroom.
3. It is the responsibility of staff or management to ensure compliance with this order.
B. Community Pools: Community pools shall reopen provided that CDC Guidelines, including all social distancing guidelines, are adhered to. In addition, the following restrictions shall apply:
1. Pool capacity shall be limited to ensure that social distancing in accordance with CDC Guidelines is maintained at all times.
2. Locker room and shower facilities shall remain closed. Restrooms shall be cleaned and disinfected regularly throughout the day. Soap and water or hand sanitizer and/or disinfectant wipes shall be provided in each restroom.
3. Pool deck seating or lounging shall be restricted to ensure social distancing in accordance with CDC Guidelines.
4. One or more facility staff or management must be present at each facility location to monitor and ensure compliance with the restrictions within this order.
Continued adherence of CDC guidelines, including while in the pool, is required. Community associations are responsible for ensuring compliance. Therefore, if members violate the guidelines both the member and the association could be fined. The CDC guidelines for social distancing can be found here:
https://www.cdc.gov/coronavirus/2019-ncov/prevent-getting-sick/social-distancing.html
A. Pools. The pool deck and pool can only be used by current residents; six (6) foot social distancing CDC guidelines are adhered to; pool deck and pool occupancy are limited to no greater than 50% capacity; and either:
(1) the use of the pool deck and pool are supervised by a sufficient number of
employees or other person(s) designated by the housing development during the hours
in which they are used to ensure compliance with the requirements of this section, and
employees or other designees of the housing development sanitize the facility’s pool
chairs, railings, gates, tables, showers, and other equipment at the pool and pool deck on
a regular basis;
or
(2) all furnishings are removed from the pool deck.
B. Tennis. Use of tennis courts and pickle ball courts is limited to residents only shall be limited to a maximum of two people on the court at any one time (i.e., singles play only), and disc golf courses limited to singles play. Basketball courts are limited to individual use (no multiplayers or pick-up games are permitted, with the exception of games such as “horse”), and social distancing must be maintained at all times. Racquetball courts are limited to a maximum of one person on the court at any one time.
Stay tuned for more. In the meantime, be safe and be well.
Are you certified?
Congratulations on your election/appointment to your community association’s board of directors. Although your job as a director is unpaid, takes a lot of time and is sometimes thankless, your role as a director is vital to your community. If it were not for volunteers willing to serve on their community association’s board of directors, Florida’s economy would collapse along with its many community associations.
Considering you took the step to get involved, you are probably aware Florida law requires each newly elected or appointed HOA or condo. director to complete Florida’s certification requirements within 90 days of being elected or appointed. Failure to do so will result in your automatic suspension from your association’s board of directors.
Gerstin & Associates offers a free certification course tailored specifically to certify HOA, condo. and co-op board members. Your participation will not only satisfy the statutory requirement, it will provide you with the information you need to perform your job well and to avoid any potential liability associated with your new role. Our certification course is continually updated offering you not only the typical subjects other law firms cover, an entire section of the class is devoted to the most recent court decisions and laws that were passed directly affecting your community association.
Although free, our courses are limited on a first come, first-serve basis. Seating is limited so please act now. Our next course is scheduled for:
January 23rd at 9:00am at the South County Civic Center Auditorium located at: 16700 Jog Road Delray Beach.
The course is free and will last about two hours. To register, simply send an email to Lori Vinikor at vinikoor@bellsouth.net
I look forward to meeting you on January 23rd.
In an effort to promote affordable and sustainable home ownership, especially among credit-worthy first-time buyers, the Federal Housing Administration today published a long-awaited final regulation, and policy implementation guidance, establishing a new condominium approval process. Some of the highlights are (click here to download the new regulations):
Single Family Policy Handbook Guidance
FHA’s new Single Family Handbook sections published today provide the additional requirements that lenders and other industry participants need in order to implement FHA’s new policy, including requirements for single-unit approvals, minimum owner occupancy requirements, and commercial/non-residential space limits.
Single-Unit Approvals
As of October 15, FHA will insure mortgages for selected condominium units in projects that are not currently approved. An individual unit may be eligible for Single-Unit Approval under the following conditions:
Minimum Owner-Occupancy Requirements
FHA will require that approved condominium projects have a minimum of 50 percent of the units occupied by owners for most projects.
FHA Insurance Concentration in Condominium Projects
FHA will only insure up to 50 percent of the total number of units in an approved condominium project.
Commercial/Nonresidential Space Limits
FHA will require that the commercial/non-residential space within an approved condominium project not exceed 35 percent of the project’s total floor area.
(click here to download the new regulations)
POINCIANA —
Poinciana residents who are in disagreement with their homeowners association are rooting for two Florida house bills that have just been filed.
Presently pending in the United States Congress, H.R. 1301 is a bill proposed to protect the installation and use of amateur radio antennas and towers in community associations. According to the bill, “[t]here is a strong Federal interest in the effective performance of amateur radio stations established at the residences of licensees”. In regard to a community association’s restrictive covenants, the bill applies existing FCC policy used when dealing with State restrictions on antennas and towers to community association declarations. The bill would, among other things, require community association “to permit erection of a station antenna structure at heights and dimensions sufficient to accommodate amateur service communications.” H.R. 1301 would also apply to private office parks and essentially any privately owned land with use restrictions related to amateur radio antennas and towers.
The full text of the bill is available here: HR Bill 1301, United States Congress, Amateur Antennas and Towers.
The past legislative session was an extremely busy one for both homeowner and condominium associations. Initial legislative proposals ranged from an entire rewrite of Chapter 720 to a depository scheme to collect assessments that would have been a disaster. In the end, at least for this past legislative session, Florida’s community associations avoided disaster. Most, but not all, of the recently passed Florida legislation affecting Florida’s community association’s are reasonable. The hardest hit group in this year’s legislative session is by far homeowner developers. The full text of each passed bill can be found at: www.flsenate.gov; www.myfloridahouse.com; and www.leg.state.fl.us.
Officers and Directors
F.S. § 720.3033 Officers and Directors.- This past legislative session there many changes to the laws governing homeowner association officers and directors. Both Homeowner association Boards of Directors and their property managers should immediately update themselves on these new legislative changes to avoid unknowingly running afoul of the law. The underlined portion below is the amended text of F.S. § 720.3033:
720.3033 Officers and directors.—
(1)(a) Within 90 days after being elected or appointed to the board, each director shall certify in writing to the secretary of the association that he or she has read the association’s declaration of covenants, articles of incorporation, bylaws, and current written rules and policies; that he or she will work to uphold such documents and policies to the best of his or her ability; and that he or she will faithfully discharge his or her fiduciary responsibility to the association’s members. Within 90 days after being elected or appointed to the board, in lieu of such written certification, the newly elected or appointed director may submit a certificate of having satisfactorily completed the educational curriculum administered by a division-approved education provider within 1 year before or 90 days after the date of election or appointment.
(b) The written certification or educational certificate is valid for the uninterrupted tenure of the director on the board. A director who does not timely file the written certification or educational certificate shall be suspended from the board until he or she complies with the requirement. The board may temporarily fill the vacancy during the period of suspension.
(c) The association shall retain each director’s written certification or educational certificate for inspection by the members for 5 years after the director’s election. However, the failure to have the written certification or educational certificate on file does not affect the validity of any board action.
(2) If the association enters into a contract or other transaction with any of its directors or a corporation, firm, association that is not an affiliated homeowners’ association, or other entity in which an association director is also a director or officer or is financially interested, the board must:
(a) Comply with the requirements of s. 617.0832.
(b) Enter the disclosures required by s. 617.0832 into the written minutes of the meeting.
(c) Approve the contract or other transaction by an affirmative vote of two-thirds of the directors present.
(d) At the next regular or special meeting of the members, disclose the existence of the contract or other transaction to the members. Upon motion of any member, the contract or transaction shall be brought up for a vote and may be canceled by a majority vote of the members present. If the members cancel the contract, the association is only liable for the reasonable value of goods and services provided up to the time of cancellation and is not liable for any termination fee, liquidated damages, or other penalty for such cancellation.
(3) An officer, director, or manager may not solicit, offer to accept, or accept any good or service of value for which consideration has not been provided for his or her benefit or for the benefit of a member of his or her immediate family from any person providing or proposing to provide goods or services to the association. If the board finds that an officer or director has violated this subsection, the board shall immediately remove the officer or director from office. The vacancy shall be filled according to law until the end of the director’s term of office. However, an officer, director, or manager may accept food to be consumed at a business meeting with a value of less than $25 per individual or a service or good received in connection with trade fairs or education programs.
(4) A director or officer charged by information or indictment with a felony theft or embezzlement offense involving the association’s funds or property is removed from office. The board shall fill the vacancy according to general law until the end of the period of the suspension or the end of the director’s term of office, whichever occurs first. However, if the charges are resolved without a finding of guilt or without acceptance of a plea of guilty or nolo contendere, the director or officer shall be reinstated for any remainder of his or her term of office. A member who has such criminal charges pending may not be appointed or elected to a position as a director or officer.
(5) The association shall maintain insurance or a fidelity bond for all persons who control or disburse funds of the association. The insurance policy or fidelity bond must cover the maximum funds that will be in the custody of the association or its management agent at any one time. As used in this subsection, the term “persons who control or disburse funds of the association” includes, but is not limited to, persons authorized to sign checks on behalf of the association, and the president, secretary, and treasurer of the association. The association shall bear the cost of any insurance or bond. If annually approved by a majority of the voting interests present at a properly called meeting of the association, an association may waive the requirement of obtaining an insurance policy or fidelity bond for all persons who control or disburse funds of the association.
720.306 Meeting of the Members; voting and election procedures; amendments —Nominations from the floor at Annual Meetings are no longer required and an election is not required unless there are more candidates than vacancies. Further, all members are now required to receive amendments to the governing documents within 30 days of their passage.
720.303 (5) Inspection and Copying of Records. Official records must be maintained for at least 7 years and have to be made available to parcel owners for inspection and copying within 45 miles of the community or within the county in which the association is located. The Association has 10 business days after receipt by the board or its designee of a written request. Records can be made available electronically. Owners can scan or photograph the records at no charge (if they use their scanner or camera). Copying rates and personnel charges were also amended.
(5) INSPECTION AND COPYING OF RECORDS.—The official records shall be maintained within the state for at least 7 years and shall be made available to a parcel owner for inspection or photocopying within 45 miles of the community or within the county in which the association is located within 10 business days after receipt by the board or its designee of a written request
The association shall allow a member or his or her authorized representative to use a portable device, including a smartphone, tablet, portable scanner, or any other technology capable of scanning or taking photographs, to make an electronic copy of the official records in lieu of providing the member or his or her authorized representative with a copy of such records. The association may not charge a fee to a member or his or her authorized representative for such use of a portable device.
The association may impose fees to cover the costs of providing copies of the official records, including, without limitation, the costs of copying and the costs required for personnel to retrieve and copy the records if the time spent retrieving and copying the records exceeds one- half hour and if the personnel costs do not exceed $20 per hour. Personnel costs may not be charged for records requests that result in the copying of 25 or fewer pages.
F.S. § 720.3085 Payment for assessments; lien claims. The most positive and important change this legislative session was legislation designed to correct or overrule the Court’s decision in the case of Aventura Management, LLC v. Spiaggia Ocean Condominium Association, Inc. HB 7119 amends F.S.§ 720.3085 and allows Florida homeowner associations to collect assessments, that were past due upon its ownership of a home, from a subsequent owner. The underlined portion below is the amended text:
720.3085 Payment for assessments; lien claims.—
(2)
(b) A parcel owner is jointly and severally liable with the previous parcel owner for all unpaid assessments that came due up to the time of transfer of title. This liability is without prejudice to any right the present parcel owner may have to recover any amounts paid by the present owner from the previous owner. For the purposes of this paragraph, the term “previous owner” shall not include an association that acquires title to a delinquent property through foreclosure or by deed in lieu of foreclosure. The present parcel owner’s liability for unpaid assessments is limited to any unpaid assessments that accrued before the association acquired title to the delinquent property through foreclosure or by deed in lieu of foreclosure.
F.S. § 468.436 CAM Disciplinary Proceedings. This law was amended to classify a Community Association Manager’s violation of either Chapt. 720, 719 or 718 as a violation subject to a disciplinary proceeding by the Department of Business and Professional Regulation. For the overwhelming amount of law abiding Community Association Managers, this legislative amendment should not be a cause for concern. The underlined portion below is the amended text of F.S.§ 468.436 (7):
Violating any provision of chapter 718, chapter 719, or chapter 720 during the course of performing community association management services pursuant to a contract with a community association as defined in s. 468.431(1).
Homeowner Association Developers
F.S.§ 720.303 (6)(d) Budgets. If a homeowner association developer elects to maintain a reserve account for the HOA, the developer’s budget must designate the particular purpose or use of the funds. The underlined portion below is the amended text of F.S.§ 720.303 (6)(d):
(d) An association is deemed to have provided for reserve accounts if reserve accounts have been initially established by the developer or if the membership of the association affirmatively elects to provide for reserves. If reserve accounts are established by the developer, the budget must designate the components for which the reserve accounts may be used. If reserve accounts are not initially provided by the developer, the membership of the association may elect to do so upon the affirmative approval of a majority of the total voting interests of the association. . .
F.S. § 720.307 Transition of association control in a community —Added to the threshold for an “automatic transition” to member control are a developer’s abandonment of its assessment, maintenance or construction responsibilities or if the developer files for Chapter 7 bankruptcy, enters receivership or loses title to a common area through a foreclosure. The underlined portion below is the amended text of F.S. § 720.307:
720.307 Transition of association control in a community.—
With respect to homeowners’ associations:
(1) Members other than the developer are entitled to elect at least a majority of the members of the board of directors of the homeowners’ association when the earlier of the following events occurs:
. . .
c) Upon the developer abandoning or deserting its responsibility to maintain and complete the amenities or infrastructure as disclosed in the governing documents. There is a rebuttable presumption that the developer has abandoned and deserted the property if the developer has unpaid assessments or guaranteed amounts under s. 720.308 for a period of more than 2 years;
(d) Upon the developer filing a petition seeking protection under chapter 7 of the federal Bankruptcy Code;
(e) Upon the developer losing title to the property through a foreclosure action or the transfer of a deed in lieu of foreclosure, unless the successor owner has accepted an assignment of developer rights and responsibilities first arising after the date of such assignment; or
(f) Upon a receiver for the developer being appointed by a circuit court and not being discharged within 30 days after such appointment, unless the court determines within 30 days after such appointment that transfer of control would be detrimental to the association or its members.
F.S. § 720.307 Pre-transition Board of Directors. The amendment to F.S. §720.307 also lowered the threshold for a member to serve as a director on the pre-transition Board of Directors. Members, other than the developer, are allowed to elect at least one non-developer related member to the pre-transition Board of Directors if 50% of the parcels in all phases have been conveyed to the members.
F.S. § 720.3075 Prohibited clauses in association documents–Developers. At
any point pre-transition of control (not the 90% conveyed mark) a developer’s unilateral amendment to the Governing Documents will be subject to scrutiny as to its reasonableness. No longer considered reasonable or allowable are “ . . .amendments to the governing documents that are arbitrary, capricious, or in bad faith; destroy the general plan of development; prejudice the rights of existing nondeveloper members to use and enjoy the benefits of common property; or materially shift economic burdens from the developer to the existing nondeveloper members.”
F.S. § 720.303 (13) Reporting Requirements — Homeowner associations are now required to register with the Division of Florida Condominiums, Timeshares, and Mobile Homes. Whether this will lead to enhanced regulation similar to condominiums, and its associated higher cost of compliance, is yet to be seen. The legislation is due to expire in 2016.
F.S. §720.303(7) Financial Reports. Mandatory financial report thresholds for homeowners’ association were increased as follows:
F.S. §720.303(10)(g) Directors: Recall. A petition to challenge a homeowner’s association failure to act on a recall petition must be filed within 60 days from the end of the Board of Directors five day review period.
F.S. §720.305(2)(a) Suspensions. The suspension of an owner’s common area use rights cannot extend to the common elements needed to access the unit, utility services to the unit, parking spaces, and elevators.
F.S. §720.306(1)(d) Amendments: Mortgages. After July 1, 2013, mortgage holders rights to approve or disapprove of amendment is limited to a negative notice and limited rights to contest.
F.S. §720.306(6) Meetings: Speaking. Advanced notice is not required for a homeowner association member to speak at a Board of Directors’ meeting.
F.S. §399.02(9) Elevators. The July 1, 2015 deadline for retrofitting elevators is removed. However, certain renovations to an elevator may require compliance even in the event of a replacement or major modifications are required for compliance.
Financials. F.S. §718.111(13). A condominium developer is required to provide financial two years after recording of the surveyor’s certificate.
Budgets. F.S. §718.1112(2)(f). Up until the second fiscal year a condominium developer can vote for reserves up until the second fiscal year after recording of a surveyor’s certificate.
Transition. F.S. §718.301(1). Transition can occur as late as seven years after the recording of the surveyor’s certificate. without an accompanying assignment of developer rights.
Hurricane Protection. F.S. §718.113(5)(a). A condominium association’s board of directors has the authority to install hurricane resistant protection extends to doors and other items. authority to install additional hurricane resistant protection is extended to include doors and other similar hurricane protection. A code compliant unit entitles the unit owner to a credit for assessments levied related to installation of hurricane protection
Suspensions. F.S. §718.303(3). The suspension of an owner’s common area use rights cannot extend to the common elements needed to access the unit, utility services to the unit, parking spaces, and elevators.
Insurance. F.S. §718.111(11)(g)2. If a condominium owner does not undertake required work, the association may do so and assess the owner for the expense.
Records. F.S. §718.111(12). Condominium association members may use their own equipment, without charge, to copy Association records. Excluded records from disclosure includes personnel records of the Association and its management company. Absent a written request for exclusion, Homeowner association’s can print a community directory with each member’s name, address and telephone number, unless the member request to be excluded.
Financial Reports. §718.111(13). Mandatory financial report thresholds for condominium associations were increased:
Directors: Terms & Qualifications. §718.112(2)(d)2. Authorization for condominium association directors staggered terms can be authorized by an association’s articles of incorporation, as well as tits by-laws. Any owner that owes money to the association is ineligible to run for the Board of Directors and his/her name should not be on the ballot.
Directors: Recall. §718.112(2)(j). A petition to challenge a condominium association failure to act on a recall petition must be filed within 60 days from the end of the Board of Directors five day review period. The challenge can be through arbitration.
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As more legislation is introduced and existing legislation is applied by the courts and governmental authorities.
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According to a June 2, 2013 article in the Sun-Sentinel a recent home sale in Broward County for 14.2 million dollars was not a record. The article continues to list the top five all time highest residential transactions in Broward County. Of this top five, Gerstin & Associates were the attorneys for the top two largest residential transactions in Broward County history! The full text of the article can be found online here or here
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