May 16, 2013Presented byYeline Goin, Esq.With Special Guest Rep. George R. Moraitis, Jr.Moderated by Lisa A. Magill, Esq.The 2013 Florida Legislative SessionAnalysis of the Impacts on Community Associations
Today’s PresentersYeline Goin, Esq.Executive DirectorCommunity AssociationLeadership LobbyHon. George R. Moraitis, Jr.Florida House of RepresentativesLisa A. Magill, Esq.Moderator
Elevator Upgrades – Condominiums andCooperatives (HB 73) Existing elevators will not need to comply withmandatory Phase II Firefighters upgrades until theelevator is replaced or requires major modification. Previous, elevator upgrades were required to bemade by July 1, 2015.
Portable Devices – Condominiums,Cooperatives & HOAs (HB 73) Portable device may be used to copy official records. No charge for copies when a portable device is used.
Directories – Condominiums,Cooperatives & HOAs (HB 73) Association may print and distribute directory. Owner may request exclusion of phone number inwriting.
New Record Requirements – Cooperatives (HB 73) Records to be maintained for 7 years/within 45 miles. Records may be made available electronically. Failure to permit inspection has penalties, includingattorney fees and costs. Destruction/failure to maintain document has civilpenalties. Copies of year-end financial statement must be madeavailable to owners and prospective buyers.
Protected Records – Cooperatives (HB 73) Attorney/client or work product privilege. Personnel records. Certain personal information of owners. Security data (passwords). Software or Operating System used by association.
Personnel Records – HOAs (HB 73) Personnel records of association or managementcompany employees are not to be inspected byowners. This protection is new for management companyemployees.
Official Records – HOAs (HB 7119) Records to be maintained for 7 years/within 45miles. Records may be made available electronically. Personnel costs for copies/retrieval. Copies reduced from .50 to .25/page. Actual outside vendor cost if more than 25 pages.
Financial Reporting – Condos & HOAs (HB 73) Compiled financial statements required for annual revenues$150,000-$300,000. Reviewed financial statements required for$300,000-$500,000. Audited financial statements for>$500,000. Report of cash receipts and expenditures for<$150,000, and all associations of less than 50 units,regardless of annual revenues.
Board Member Terms & Qualifications-Condominiums (HB 73) Governing documents can provide for two yearterms, which negates the need for owner vote.
Director Certification/EducationalCertificates – Condominiums (HB 73) Association secretary must retain certification for 5years after election or the duration of the director’sterm, whichever is longer.
New Board Certification Requirement –Cooperatives (HB 73) & HOAs (HB 7119) Written certification within 90 days of election thatboard member has read and will uphold governingdocuments. Or participate in a board member education course. Board member is suspended until he/she complies. Certificate to be maintained for 5 years afterelection, or duration of tenure. Board action not affected by failure to getcertification.
Elections- Timeshares (HB 73 & HB 7025) Timeshares do not have to follow the “two-notice”system that applies to condominiums.
Elections – Condominiums, Cooperatives & HOAs (HB 73) Any challenge to the election process must takeplace within 60 days after the results areannounced.
Elections – HOAs (HB 7119) Nominations from the floor are not required ifnominations are submitted in advance of themeeting. Election is not required unless more candidates arenominated than vacancies exist.
Recalls – Condominiums, Cooperatives& HOAs (HB 73) If board doesn’t act on a recall petition, ownerrepresentative can challenge the failure. Petition must be filed within 60 days after board failsto act. Recalled board member may file a petition forarbitration to challenge the validity of recall within 60days after recall certified. No recall petitions accepted by Division if 60 days orfewer until next election or if 60 days or fewer havenot elapsed since election.
Hurricane Protection – Condominiums(HB 73) Board can now install code-compliant doors or otherprotection also. Vote of owners not required if doors are theassociation responsibility. Credit to owner for installed hurricane protection.
Suspension of Use Rights – Condominiums,Cooperatives & HOAs (HB 73) Suspension of use rights for failure to comply withgoverning documents does not apply to– Limited common elements used only by that unit– Common elements needed to access unit– Utility services provided to unit– Parking spaces– Elevators
Mortgagee Consent for Amendments –Cooperatives & HOAs (HB 73) Incorporates the mortgagee consent provisionsalready in the Condo Act.
Reporting to DBPR – HOAs (HB 7119) Every CAM/HOA must report identifying informationto Division by 11/22/13. DBPR will have online registration system by10/1/13. DBPR will submit HOA report to Governor by12/1/13. One time requirement. Sunsets on 7/1/16.
Contracts with Board Members – HOAs(HB 7119) Contracts with Board Members– Must comply with F.S. 617.0832.– Enter disclosures into written minutes of meeting.– 2/3 vote of directors’ affirmative vote required.– Next meeting of members, contract maybe canceledby majority vote.
Goods or Services of Value to BoardMembers – HOAs (HB 7119) No kickbacks. Cause for removal of officer or director. May accept food to be consumed at a businessmeeting with a value of less than $25 or goods andservices at trade fairs or education programs.
Criminal Charges Against BoardMember- HOAs (HB 7119) Director or Officer who is charged by information orindictment with embezzlement/theft is removed fromoffice. If resolved without a finding of guilt, thedirector/office shall be reinstated. Member who has such criminal charges pending isineligible for position.
Insurance and Fidelity Bond for BoardMembers – HOAs (HB 7119) Insurance or fidelity bond required to covermaximum funds in association’s custody. Covers all persons who control or disburse funds ofthe association. May be waived annually by vote of the owners.
Amendments – HOAs (HB 7119) Copies of amendments must be provided tomembers within 30 days after recording.
Developer Turnover Affecting BoardMakeup – HOAs (HB 7119) Members entitled to elect majority of board when– Developer abandons responsibility for amenities orinfrastructure.– Developer goes into Chapter 7 bankruptcy.– Developer loses title through foreclosure.– Receiver is appointed for developer. At least one non-developer member when 50% ofunits have been sold.
Developer Amendments – HOAs (HB 7119) Prior to turnover, developer’s amendments togoverning documents must be reasonable.
Association Liability for UnpaidAssessments – HOAs (HB 7119) An association that acquires title through foreclosureis not liable for unpaid assessments. Intent is to allow association to demand past dueassessments from next owner.
Mortgage Foreclosures – Condominiums,Cooperatives & HOAs (HB 87) Banks will have one year to enforce a deficiencyjudgment. Limits on deficiency judgment. Requires certain documents from bank when filing aforeclosure action. Foreclosure judgment is final. Association’s order to show cause shall be reviewedimmediately by judge.
Questions & AnswersYeline Goinygoin@becker-poliakoff.comRep. George MoraitisLisa Magilllmagill@becker-poliakoff.com