Wednesday, June 19, 2013

Impact of the 2013 Florida Legislative Session / New Laws Relevant to Associations

All of the major bills passed by the Florida Legislature have now been signed into law by Florida Governor Scott. These bills include House Bill 73 - Residential Properties, House Bill 87 - Mortgage Foreclosure, House Bill 7119 - Homeowner's Associations, and House Bill 77 - Landlords Tenants.  Below is a brief summary including the key points of each bill along with commentary regarding the pro/cons and practical implications of each bill....

  • Removes the requirement that elevators be retrofitting to meet certain building requirements (Phase II Firefighter’s Service) by 2015. This does not apply to new elevators or elevators that are materially altered or renovated, these will need to meet the new codes.
  • Allows members of an association to use a portable devises, including smartphones, tablets, and portable scanners to make electronic copies of official.
  • Establishes a procedure to allow a board member who has been recalled to file a petition challenging the validity of the recall within. 
  • Clarifies the limitation of use of common elements by delinquent owners. Associations can restrict delinquent unit owners access to the common elements, but those elements do not include Limited Common Elements, Common Elements needed to access the unit, utilities services provided to the unit, parking spaces, and 
  • Gives HOAs and Co-ops the same ability to amend their governing docs without having to get mortgagee consent as condos currently have.  Any amendment to the governing documents that does not affect the rights of the mortgagee does not require the consent of the mortgagee if the mortgage was recorded after July 1, 2013.
  • Change/increases the financial reporting for HOAs and COAs.  Also, formerly condominiums with less than 75 units only had to prepare a report of cash receipts, the number was reduced to 50 units.
    •  Less than $100,000: report of cash 
    • $100,000-$200,000: 
    • $200,00 - $400,000: 
    • $400,00+: Audit
      • NOW
    • Less than $150,000: report of cash receipts
    • $150,000-$300,000: compilation
    • $300,00 - $500,000: Review
    • $500,000+: Audit

HB 87 –  Allows junior lien holders to request and order to show cause. The “show cause” procedure has been in place for quite some time, but has only been available to Plaintiffs/banks. The legislatures has made that same tool available to junior lien holders, like community associations. 
  • the impact of this procedure is discussed in a previous post - Governor Signs HB 87 - again though, this will help associations push uncontested and stalled mortgage foreclosure actions. For those matters it could literally bring the foreclosure to conclusion in a matter of weeks.  They key though is uncontested. The "Show Cause" procedure doesn't not work is the owner is defending the foreclosure.  

  • Requires that CAMs report certain information about HOAs to DBPR by November 22, 2013.  This information includes the name of the association, the FEIN number, the mailing and physical address, the number of parcels, and the total amount of revenues and expenses from the annual budget of the association.
    • Frankly the reason for this in so DBPR can start levying a charge per door on HOAs like there is already in place to COAs. 
  • makes the official records requirements of HOAs and COAs the same, and lowers the costs that associations can charge for copies of records.
  • Gives DBPR the authority to discipline 
  • Provides that certain disclosures have to be made if the association enters into a contract with any of its directors and allows this contract to be cancelled with a majority vote for the 
  • Explicitly prohibits board 
  • Provides that within 30 days after recording an amendment to the governing docs, the association will provide copies of the amendment to the 
  • Within 90 days of taking office, HOA board members have to certify that they read and understand the association’s governing docs or take a DBPR approved class. (Condo directors already have this 
  • HOA no longer have to take nomination for directors from the floor at the annual meeting if voting is allowed in advance of the meeting.
    • This is a good thing and will streamline the annual meetings for 
  • Creates a carve out for the term “previous owner” as it applies to association who acquires title to parcel by deed in lieu or foreclosure.  This only applies to 720 (HOAs) and not 718 (Condos). 
    • I'm going to be writting and entire post about this is the near poses some interesting scenarios for HOAs and collection strategy.  

SB490/HB77 - Beefed up the language which protects tenants who pay rent to the association pursuant to 718.116(11) from retaliation from delinquent owners/landlords.
  • This certainly isn't a bad thing for condo associations but it's redundant. The tenant paying rent pursuant to 718.116(11) is already protected from eviction. This bill adds a line to Chapter 83, Florida Statutes, the chapter on Landlord Tenants, preventing retaliatory conduct by a landlord/owner against a tenant who complies with 718.116(11).  
Overall, the legislative session was a good one for associations in Florida.  Check out the Community Association Leadership Lobby page.  It's the largest lobbying group for associations in the state and are very involved in the legislative process.  

1 comment:

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