07 Aug How Will the Recent Legislative Update Effect my Florida Condominium?
During the last week of June of 2017, the Florida Governor signed three bills into action that dramatically impact condominium communities in Florida. These three bills are known as HB 1237, SB 398, and HB 6027, and here is an overview of how these three bills will affect Florida condo management:
If you recall, El Nuevo Herald and Univision 23 offered extensive reporting on condominium association fraud last year, primarily in Dade County, Florida. The reporting highlighted serious issues related to the enforcement of the Florida statutes that govern condominium associations.
HB 1237 became effective July 1, 2017 as a result of these investigations and prohibits the following:
- Self-dealing by board members
- Election fraud
- Lawyers from representing board members and the condo management association
- Board members purchasing a unit at a foreclosure sale as a result of the association placing a lien for unpaid assessments or taking title to the unit in lieu of foreclosure.
- Engaging a service provider that has any connection to a board member.
- Board members from owning more than 50 percent of the units in a condominium community.
- Officers and directors from not disclosing activities that could be a conflict of interest.
Another area that HB 1237 addresses is to increase the access of condo management records to unit owners. The bill requires that additional records be maintained and made available to unit owners. The condominium association must provide an annual report the the Department of Business and Professional Regulation that provides the financial institutions where accounts are held, and unit owners can have access to this information as well.
As of July 1, 2018, all Florida condominium associations with more than 150 units must have a website where unit owners can gain access to copies of the community’s official records.
Historically, condominium associations have been able to charge a fee for the preparation of certificates for assessments, and some of these fees were astronomical. SB 398 limits the amount of fees that can be charged ($250 maximum and an additional $150 if a delinquency exists) and specifies that information that must be provided to unit owners in the event of a request.
Here are some additional requirements that SB 398 puts in place:
- The condo association must respond to a request for an estoppel certificate within 10 days (was previously 15 days).
- Estoppel requests delivered by hand or email will have a 30-day effective period; requests delivered by regular mail will have a 35-day effective period.
- The condo association may not charge a fee for an amended estoppel certificate.
This bill removes three statutes from financial reporting for community associations in Florida. The elimination of these statues now allows for the following:
- All condo associations with $150,000 or more in receipts must provide formal financial statements unless this requirement is waived by the membership.
- A condo association can waive the annual formal financial reporting requirement.
Our Florida condo management company recommends that all condominium association board members read through these three bills for more information. Please contact us at Vesta Property Services to learn more about how this recent legislative update will impact your Florida condominium.