Homeowners’ and condominium associations play a crucial role in maintaining the harmony and value of residential communities. A common question that arises is whether these associations can adopt amendments that change the leasing rights of owners within the community. Let’s delve into the specifics according to Florida law. Homeowners’ Associations and Leasing Amendments  Chapter 720 of the Florida Statutes is called the Florida Homeowners’ Association Act. This law was amended in 2021 to address amendments that regulate the leasing of “parcels” within a homeowners’ association. Typically, the parcel is the home and the land the home sits on, and usually other improved or unimproved portions of lots. A new Section 720.306(1)(h) was added, which says that any amendment to the homeowners’ association’s governing documents, adopted after July 1, 2021, that prohibits or regulates rental agreements, only applies to a parcel owner that acquires title to their parcel after the effective date of the amendment, or to a parcel owner who consents to the amendment. However, this restriction does not apply to amendments which regulate or prohibit rental agreements for terms of 6 months or less. Further, amendments that prohibit the rental of parcels for more than 3 times in a calendar year also apply to all parcel owners. Homeowners’ associations continue to have the ability to adopt amendments that regulate or prohibit leases of 6 months or less, and still have the ability to adopt amendments which prohibit leasing more than 3 times in a calendar year. Condominium Associations and Leasing Amendments  For condominiums, Section 718.110(13) of the Florida Condominium Act states that any amendment which prohibits a unit owner from leasing their unit, alters the duration of the rental term, or limits the number of times an owner may rent their unit during a specified period, only applies to those owners who take title after the effective date of the amendment, or those owners who consent to the amendment. There is no 6-month/3 times per year exception in the Condominium Act. Florida Senate Bill 280  During the 2024 Florida legislative session, CS/SB 280 was passed by the Florida Legislature. This...

Last year, there was a disturbing trend of confrontation – some of which even became violent between condominium owners or homeowners, and their association board members. From our own back yard to across the globe, there were several instances of multi-family housing residents whose disputes were bad enough to make the news. This should be unacceptable – and more importantly – avoidable. To prevent physical altercations like these from happening, we offer the following advice: Avoid Confrontation  Remember, you’re only a board member while you are attending a board meeting, and nowhere else. When you’re walking around the halls of the community or when you are at the pool, you are not. You are not conducting board business and therefore, you don't have any obligation to respond to questions or concerns. If you are confronted by an owner outside of a board meeting, we recommend acknowledging their concern, then asking them to submit it in writing to the property manager so it may be addressed at the next board meeting.  Conflict Resolution In a homeowner’s association, before most covenant disputes can be litigated in a court of law, the owner or the association must first make a written demand for pre-suit mediation. This requires both parties to agree to a mediator and to meet and discuss a formal resolution before it turns into an expensive and time-consuming lawsuit. The job of the mediator is to facilitate a resolution that each side can live with. Absent a meditated resolution, either party may then file suit in a court of law. As for condominiums, condo owners and the association have the right to either engage in pre-suit mediation for most covenant disputes or to demand non-binding arbitration, a process more akin to litigation that is heard before an arbitrator appointed by the state agency that governs condominiums. If a party is not satisfied with the arbitrator’s decision, they may timely file a lawsuit to have the matter litigated in a court of law. When there is a dispute in an HOA between an association and a resident, the association may file a demand that the homeowner...

Today we'll discuss an important topic that seems to be inquired about often regarding community associations governance in Florida - and that topic is closed board of directors’ meetings. An important aspect of the board of directors’ role in governing an association—whether it is a condominium association or homeowners association—is transparency.  The residents of an association want to be able to trust the actions of the board and have a system that ensures accountability.  Accordingly, board meetings are, for the most part, open to members of the association.  However, there are circumstances where closed board meetings, which are not open to the members, are required.  Closed board meetings are a common practice in community associations, but when are they appropriate? Closed board meetings are gatherings of the directors where only board members are present to discuss sensitive or confidential matters affecting the association. In Florida, the law provides when an association’s board can close its meetings to homeowners.  Generally closed meetings are allowed in two situations: those involving legal matters and personnel issues.  The reasons for these particular two subjects to be addressed in closed meetings make sense. Legal matters include items such as pending litigation or consultation with attorneys.  When these matters are discussed at a meeting, the association’s counsel should be present.  Consultations with attorneys often involve the exchange of privileged and confidential information to protect the association’s interests.  Allowing access to others outside the board could result in the inappropriate disclosure of protected information, for example, if such meetings were open that information could be disclosed to those whose interests are potentially adverse to the association. The second subject appropriate for closed meetings is personnel matters. This is logical because discussions concerning an association’s employee’s performance or the need for disciplinary actions should be held in closed sessions in the interests of privacy and fairness. While closed meetings are necessary at times, transparency and accountability are still vital. Even in closed meetings, proper notice under Florida law that there will be a meeting must be provided to the membership and the decisions made in closed sessions should be...

From time to time, an association will be confronted with the need to go into or onto an owner’s property for the purpose of undertaking required maintenance as may be authorized by the governing documents. In some instances, the association, in order to prevent further damage to other property, may need to go into a unit to remediate mold or other water damage when the owner is unavailable or refuses to provide access to the association. In either situation, however, it is not uncommon to encounter owners who are not just uncooperative but some who threaten violence. What is an association to do? First, the association must understand what rights it may have. For homeowner association communities, the Homeowner Association Act, Unlike the Condominium Act, does not have any specific statutory language governing access. In such a situation, the Board of Directors and management must look to its governing documents which almost always (especially for townhome communities) have a provision that allow for reasonable access for the association to the property to fulfill maintenance obligations. As for condominiums, Fla. Stat. 718.111(5) provides the statutory right for access to units during reasonable hours, when necessary, for the maintenance, repair, or replacement of any common elements. The statute further provides guidance on the process an association must take to access an abandoned unit. Second, except when bona fide emergency access is needed, condominiums should give the owner written notice of its need to enter the unit. If the unit is abandoned, at least two (2) days’ notice is required. For units that are not abandoned, the statute is silent on the amount of notice to be given. Absent a provision in the Declaration of Condominium, you may, for guidance, review Fla. Stat. Section 83.53(2) of Florida’s Landlord-Tenant Act which defines reasonable notice as 12 hours prior to entering between 7:30am – 8:00pm. Homeowner associations should follow similar protocols unless the governing documents provide specific notification timeframes. Understanding that an association may have access rights does not guarantee that the owner will be cooperative. In such situations, a homeowners association may serve a pre-suit...

As many of you may be aware, Congress passed the Corporate Transparency Act in January 2021. The intent of this law is to assist in combatting financial crime and fraud. In connection therewith, the law requires “reporting companies” to report specific information about the owners and managers of their companies to the Financial Crimes Enforcement Network (FinCEN). There has been some debate as to whether or not Condominium and Homeowner Associations are governed by this Corporate Transparency Act. The prevailing view in the industry is that unless and until the law is clarified or changed, Condominiums and HOAs are considered “reporting companies” that must submit the required information to FinCEN. This information includes the legal name, address, state of formation and taxpayer identification number(s) for the company; and the legal names, dates of birth, residential addresses and government-issued identification numbers for all of the “beneficial owners” of the entity. The Act defines “beneficial owners” as those individuals who (i) directly or indirectly, exercise substantial control over the company; or (ii) own or control at least 25% of the company’s ownership interests. The Directors and Officers of your Community Association are presumably included under the control aspects of the definition. The reporting date under the Corporate Transparency Act began on January 1, 2024, and any Community Association that was formed prior to that date will have up until January 1, 2025, to file their initial report. Any Community Association that is formed after January 1, 2024, will be required to file their initial report within thirty (30) days of their formation date. Any time there is a change to the “beneficial owners” (e.g., a director resigns, a new director is elected, a director changes her/his address), the association has 30 days to report the change to FinCEN. The penalty for failing to timely submit required reporting information to FinCEN is $500.00 per day, up to $10,000. As such, in 2024, it will be very important for Community Associations (Condominiums and Homeowners Associations) to consult with legal counsel as to their requirements and obligations under the Corporate Transparency Act, in order to meet...

As we conclude 2023 and go into the new year, many Condominium Associations are consulting with legal counsel as to how to best address the changes in the law with regard to waiving reserves. After December 31, 2024, Condominiums with buildings of three (3) stories or higher will no longer be able to waive or reduce certain types of structural integrity reserves (SIRS) as enumerated under the new law. However, what is often overlooked is the fact that there are other changes to Chapter 718 ("Condominium Act") which affect all Condominium Associations, regardless of the height of the building.Specifically, under the new law which is currently effective, any Condominium Association which wishes to waive reserves that remain waivable (i.e., Condominiums under three (3) stories or for those Condominiums that are three (3) stories or higher, non-SIRS reserves), such reserves may now only be waived or reduced by a majority vote of the total voting interests of the Condominium. This is a major change from the previous statute which only required a majority of those in attendance in person or by proxy at a duly called meeting to waive reserves, as long as a quorum was established. Now, effective as of October of 2023, alI Condominium Associations attempting to waive reserves that remain waivable, will need to meet the higher threshold of obtaining a majority vote of the entire voting interests.As such, whether you are a Condominium of three (3) stories or higher, or not, it is important that you consult with legal counsel when attempting to waive or reduce reserves in the future. Additionally, it is likely that your voting materials may need to change and should also be reviewed by counsel accordingly.Steven G. Rappaport is an Equity Partner in the Community Associations Practice Group. Mr. Rappaport handles transactional matters for the firm’s community association clients, including drafting amendments to governing documents, attending Board meetings and elections, handling covenant enforcement disputes, and providing opinions on all aspects of association issues. Learn more about Steven including how to work with him here: https://ssclawfirm.com/steven-g-rappaport?view=employee&id=18

Creating a budget is one of the primary and most important functions that any community association board does during its tenure. The budget will serve as the guideline to determine the dollar amount owners are charged to live in their communities. There are differing obligations to consider when budgeting for a Homeowners Association (HOA) versus a Condominium Association. Today, we will discuss the differences and offer tips when creating your own community association budget. Let’s start with HOAs. HOA budgets are often a bit simpler than those for condominium associations. That is because HOA budgets normally do not require reserves. Reserves refer to funds set aside for future capital expenses and major repairs or replacements of common property or assets within the community.  Unless members of the association have voted to create reserve accounts, or the original developer of the property put reserves in the HOA’s Declaration of Covenants, Conditions, and Restrictions (CC&R) – commonly referred to as simply the “declaration” – reserves are not mandatory for HOAs. However, if the HOA votes to put money away for future capital expenses, or defer line items (like maintenance), they have that option. Unlike condominium associations, HOAs are not limited or hamstrung by Florida’s Reserve Statutes, which require specific line items in the condo’s budget. For HOAs, the reserves are more like a savings account to use at the board's discretion. One of the misconceptions of the budgeting process is going into it with the intention of trying to hit a target assessment mark. Members may get in the mindset of trying to raise or lower assessments or reach a specific number, like deciding we want $400 a month assessments, then trying to figure out how to get there. Whether for HOAs or condominium association, that's really not how budgets are supposed to work.  Budgets are estimations of expected expenses for the upcoming year that are created in order to derive a necessary revenue stream. The idea is to put all of your expected expenses into a basket, itemize them through your budget, the sum of which the necessary amount of revenue you...

Those who live and work in Florida know that there is no better place…anywhere.  However, every paradise must have its snake, and for us, that snake’s name is “windstorm.”  Hurricanes, tropical storms, cyclones, and the like are apt to occur anytime, but most particularly between the months of June and November.  Financial planning and budgeting for the ramifications of these disasters, including maintaining insurance, securing lines of credit, and maintaining reserves, can make the jobs of boards of directors that much more challenging.  Nevertheless, with proper planning, and open communication with the membership, associations can mitigate their damages and minimize surprise. Florida is the metaphorical “catcher’s mitt” for hurricanes and tropical storms, necessitating comprehensive property casualty insurance coverage. This includes protection for structural damage, common areas, and liability insurance.  For condominiums associations, the Florida Condominium Act (Chapter 718, Florida Statutes) requires that you must have full replacement coverage, which must be determined by an independent appraisal at least every 36 months.  However, as we all know, the number of insurance carriers authorized to do business in Florida continues to dwindle, and prices continue to soar.  Therefore, strategically the crux lies in choosing the right insurer. Selecting a reliable insurer is a pivotal decision. Condominium associations should prioritize "A" rated carriers for their financial stability and strong track record. Prominent carriers like Chubb, Allianz, and Travelers Insurance have earned their reputations in the Florida market.  If, as has happened to so many of us, you are cancelled and unable to find a replacement private carrier, we are fortunate to at least have Citizens Insurance as our carrier of last resort. Insurance premiums continue to rise with each windstorm.  In fact, while most associations experienced a significant increase last year, that increase did not include the calculation of damages caused by Hurricane Ian, and most experts anticipate even greater insurance costs during 2024.  Managing premium payments can pose a challenge. To alleviate the financial burden, associations may opt for installment plans or explore financing options. Additionally, implementing risk mitigation measures, such as storm-resistant building improvements, may help curtail long-term premium costs.  Consideration should...

Senate Bill 360 (SB 360) was signed into law by Gov. Ron DeSantis on April 13, 2023, immediately becoming effective upon such signing. The bill is sure to significantly impact construction defect claims in Florida. This is because it drastically reduces the time limit for property owners to file suit against builders and construction professionals for construction defects and imposes a more stringent standard for bringing a claim under the Florida Building Code. Furthermore, the bill shortens the statute of repose for construction defect claims from 10 years to 7 years. Essentially, a statute of repose is the absolute deadline by which a lawsuit can be filed, even if a cause of action hasn’t yet occurred or you don’t know you may have a claim.  The bill not only shortens the length of time from 10 to 7 years, but it also changes the events that may trigger the clock to start and changes it from the last event to occur to the first to occur. Previously, the clock started running on the latest of any of the following events: actual possession by the owner; date of issuance of a certificate of occupancy; date of abandonment of incomplete construction; or the date of completion of termination of the contract between the engineer, architect, or contractor and her/his employer. However, now, the clock begins running on the earliest of any of the following events: the date of issuance of a temporary certificate of occupancy, a certificate of occupancy, or a certificate of completion; or the date of abandonment of incomplete construction. This means the length of time before building owners can be barred from bringing defect claims is shortened significantly. The bill also narrows the scope of statutory civil actions against builders for alleged violations of the Florida Building Code from any violation to a “material” violation. The bill defines a “material” violation as a Florida Building Code violation that exists within a completed building, structure, or facility which may reasonably result, or has resulted, in physical harm to a person or significant damage to the performance of a building or its systems. HB 360 Quick...

House Bill 437 (HB 437), a new law that went into effect on July 1, 2023, should be noted by any person living in a community association and every board member of a community association in Florida. With respect to condos, HB 437 adds Patriot Day to the specified days during which unit owners may display 1 portable, removable flag of the United States or one of its military branches. As for HOAs, homeowners may now display up to 2 flags representing the United States, a US military branch, Florida, a POW-MIA flag, and/or a “first responder flag”; previously, only 1 flag was statutorily permitted. The statute defines a “first responder flag” as recognizing and honoring and of the following: law enforcement officers, firefighters, paramedics, EMTs, correctional officers, 911 public safety telecommunicators, advanced practice registered nurses, licensed practical nurses, registered nurses, statewide urban & rescue program participants, federal law enforcement officers. Finally, HB 437 creates a new section of Chapter 720 providing that a homeowners association may not prohibit owners or their tenants from installing, displaying or storing items that are not visible from the parcel’s frontage or an adjacent parcel. HB 437 Key Factors: HB 437 amends Chapter 718 to provide for Condominium Associations that certain flags may now be flown on Patriot Day (September 11th) in addition to the existing list of holidays for which a Condominium unit owner may fly 1 portable, removable flag.HB 437 further amends Chapter 720 for Homeowners Associations to allow the flying of up to two (2) flags and expands the list of allowable flags to include “First Responder flags”. Why is HB 437 important? For Homeowners Associations, this legislation also creates a new Section of Chapter 720 to allow the installation, display and storage of items in a Homeowner’s rear yard, so long as such items are not visible from the frontage of the parcel or from an adjacent parcel. This would include the ability of a homeowner to store, place or install any items, such as boats, RV’s, and artificial turf, or any other items, so long as they are not visible...

Understanding SB 154 - Condominium and Coop Safety (Surfside Glitch Bill) Effective June 9, 2023, except as otherwise indicated herein This bill was passed in response to the surfside legislation passed last year, namely SB4D. This legislation clarifies many of the open issues and concerns that Associations were faced with after last year’s legislative session. Applies to Condominiums and Cooperatives. Milestone Inspections The legislature clarified that the requirements for the milestone inspections and structural integrity reserve studies apply only to residential Condominiums and Cooperatives, and not commercial Condominiums or Commercial Cooperatives. Note, the residential portion of a mixed use Condominium or mixed use Cooperative is subject to the milestone inspection and structural integrity reserve study requirements. The previous legislation differentiated between Condominiums and Cooperatives that were within three (3) miles of the coastline versus those that were not located within three (3) miles of a coastline. The coastline analysis has now been removed, and all condominium or cooperative buildings that are three (3) or more stories must conduct their milestone inspections within thirty (30) years of the building’s certificate of occupancy (the “30 Year Mark”), unless an earlier inspection (i.e., within twenty-five (25) years of certificate of occupancy) is justified by a local enforcement agency taking into account certain environmental factors, such as proximity to salt water. The legislature expanded who could perform the milestone inspection so that it could be performed by a “team of professionals,” with an engineer or licensed architect acting as the person responsible. The bill authorizes local enforcement agencies to extend the deadline for a building if it can be shown with good cause that the building has entered into a contract with an engineer or architect before the deadline but that the report cannot be reasonably completed prior to then. The bill specifies that the association must notify the membership of the deadline to complete a milestone inspection within 14 days of notice from the local enforcement agency that a milestone inspection is required. The bill further permits the local enforcement agency to accept a report issued by an engineer or architect that inspected the...

Understanding HB-919 - Homeowners Bill of Rights This law applies only to HOA’s and does not apply to Condominiums or Cooperatives.  This Act takes effect October 1, 2023. For all HOA notices of Board meetings, the notices now must specifically identify all agenda items for the meetings. The bill requires that where an Association collects a deposit from a member for any reason, including construction or a lease security deposit, or any other deposit, the Association must keep that deposit in a separate account from other Association funds.  Upon completion of the construction project or other reason for which the deposit was collected, the member may request an accounting from the Association, and the accounting must be provided within 7 days of the request.  Also, the Association must return any unused funds to the member within thirty (30) days after the construction project or other reason for the deposit has been completed. The bill provides that an owner’s designated mailing address is the member's property address unless the member has sent written notice to the association requesting that a different mailing address be used for all required notices. Similarly, a member's e-mail address is the e-mail address provided when the member consents in writing to receiving electronic notices unless the member has sent written notice to the association requesting that a different e-mail address be used for required notices. The bill provides that officers, directors or managers who knowingly accept a kickback or other items without consideration may be subject to monetary damages. It further provides for removal from office if charged or indicted for certain crimes such as forgery of ballots and envelopes, theft or embezzlement of Association funds, destruction of Association records, and obstruction of justice. If any such criminal charge is pending against an officer or director, such officer or director may not be appointed or elected to any position as an officer or director in any association, nor may have access to any official records of any association, except pursuant to Court Order. The bill requires developer-appointed officers and directors to annually disclose to the association their...

An important function of a community association is to oversee essential services that vendors provide for the community such as landscaping, pest control, asphalt paving, and security.  These services require written contracts which should include important terms that protect the association, particularly in the event that the vendor does not perform its side of the bargain or causes damage to a person or property.  As further discussed, it is easier to prevent large costs and legal exposure to an association by sound contract language crafted or approved by an attorney at the start of a relationship with a vendor than to repair the damage that a poorly worded agreement that was simply signed on an association’s behalf without legal review has created. Legal counsel’s assistance with vendor, and other service, contracts can be important.  Contract disputes can be very expensive and time-consuming.  And, such disputes aren’t always incorporated into the association’s annual budget which could put a lot of financial strain on the association and lead to unpopular special assessments.  Also, the association can be stuck with a vendor that is doing a poor job.   Some examples of where an attorney’s advice is important include making sure the vendor is contractually obligated to provide sufficient insurance and that there are well worded indemnification provisions.  There are some nuances in Florida law regarding indemnity and all too often it seems that contracts created by vendors are one-sided and don’t protect the association in the event for example that a third party is injured as a result of the vendor’s services.  Also, contracts created by the vendor may be unclear or unfavorable to the association regarding the vendor’s responsibilities, the timeframe by which the work must be commenced and completed, payment terms, recourse for the vendor’s failure to perform, warranties, under what conditions the agreement can be terminated, and where litigation must be commenced if there is a dispute, to name just some possible provisions where an attorneys’ involvement in contract review can be very important.  I recall an instance where a national vendor puts in its standard contract that any lawsuit...

The Florida Association of Counties (FAC) has appointed Broward Commissioner Steve Geller to serve as Chair of the FAC Community & Urban Affairs Committee and Policy Leader on the FAC Finance, Tax & Administration Policy Committee.  The Community & Urban Affairs Committee is tasked with developing and recommending an annual statewide legislative platform for counties based on the following areas: Affordable Housing; Growth Management; Development, Planning and Zoning; State and Regional Transportation and Strategic Intermodal System Issues.  The Finance, Tax and Administration Committee oversees policies relating to the taxation and funding of local governments, administration of essential public services and accessible and accountable county government.  Commissioner Geller is uniquely qualified to serve on these committees with experience as a County Commissioner (2016-Present), Florida State Senator (1998-2008) and Florida State Representative (1988-1998). Geller served as Chair on the State Community Affairs Committee and as Vice Chair and Ranking Minority Member on the Finance and Tax Committee during his 20 years in the State Legislature. His areas of expertise align with those of the Florida Association of Counties. His most recent record of accomplishment includes: Creation of Film Lauderdale that serves as the Broward County Film Commission providing incentives to create high paying jobs, increase tourism and promote Broward County. Commission approval to allow affordable housing in commercially zoned areas located along transit-oriented corridors.Broward County Apprenticeship Program that mandates apprenticeship participation requirements on County construction contracts over $5 million, increasing opportunities for high paying skilled jobs.Advocate for innovative methods for water management and environmental planning as climate change has posed significant challenges such as flooding, sea level rise and extreme temperatures. Committed to public service, Commissioner Geller currently serves as Chair of the Broward County Water Advisory Board and Chair of the South Florida Regional Planning Council. He also serves on the Executive Committee of the Florida Association of Counties and the Broward County Cultural Council. For more than 85 years, the Florida Association of Counties (FAC) has represented the diverse interests of Florida's counties, emphasizing the importance of protecting home rule - the concept that communities and their local leaders should make the decisions that...