Condos and HOAs

Let’s assume that Hurricane Rina with her 160 mph winds has just cut a path of devastation across the Florida peninsula, knocking out power in Broward, West Palm Beach and Lee counties.  Many of the area condominiums are uninhabitable with the unit owners scattered across the country.  The Board, at least those who are here in contact, need to take immediate action to secure the property and begin the recovery process.  What is the extent and limits of the Board’s power?  Can the Board prohibit unit owners from staying in the condominium during the storm and returning afterwards?  The answers to the aforesaid questions can be found in Section 718.1265, Florida Statutes.  Among the board’s powers include the following: [Note: For their powers to become effective, a state of emergency must be declared in the locale where the condominium is located.]

• Statutory required notices of board and membership meetings is dispensed with, allowing boards to give notice in any practicable manner, including publication, radio, mail, or the internet. 
• Non directors can be named as assistant officers with the same authority as the executive officers who they are designated to assist.
• Contract for debris removal.
• Based upon advice of emergency management, officials or licensed professionals, prohibit unit owners, family members, tenants or guests from entering the condominium property.
• Requires the evacuation of the condominium property owners in the event of a mandatory evacuation order in the location where the condominium is located.
• Mitigate property damage, including removal and disposal of wet drywall, insulation, carpet, cabinetry, or other fixtures on or within the condominium property.
• Levy special assessments without approval of the unit owners.
• Borrow money and pledge association assets without prior unit owner approval.

The drought and extremely low water levels are giving us an opportunity to evaluate the health of our lake banks. Lake erosion in south Florida is a major problem. Shoreline erosion is not only unpleasing to the eye but also causes property damage and is a very a serious safety issue. Typically erosion is caused by the action of wind and water, however other factors accelerate erosion including man altering the landscape and some fish species. The more erosion, the steeper the lake slope. The steep slopes can make it impossible to rescue someone that has fallen into a lake. Pesky sailfin catfish burrow into lake banks creating tunnel like areas rendering them unstable, especially for a heavy equipment.

While we can’t stop mother nature, we can help slow down the rate of erosion. There are several solutions available for restoring lake banks and protecting them from future erosion. With low lake levels, now is the time to assess how much of the land has been lost as well as the most effective way to restore the bank. A good website to visit is: lakeerosionrestoration.com.

It’s not exactly a news flash that Broward’s a very, very large county, and we’ve found it challenging to find meeting places that are more convenient for our members. Because they’re all over the county, from the beaches to the edge of the Everglades, and from Palm Beach to the M-Dade line, we’re taking a great suggestion from one of our members. We’re going to have meetings in addition to our regular ones, finding different locations to attract officers, board members, unit owners and anyone interested in what we do.

Catherine Evanoff, Secretary of the Master Association of Beverly Hills Condos has generously offered her facilities for our extra September meeting. She knows how important it is to get the information and education the Coalition offers to as many of Broward’s associations and interested citizens as possible. Catherine has arranged for us to have a meeting on September 23 at Beverly Hills, and she’ll extend an invitation to residents of Hillcrest, Hollywood, Hallandale Beach and Dania Beach as well. Catherine and I are reaching out beginning with this notice.

The sponsor of the meeting will be Kane and Company, PA, with Jeffrey Ducker, CPA speaking on issues vital to the fiscal solvency of associations. This is the number one nightmare that haunts so many of our associations, and it’s not going away anytime soon.

The Coalition’s members take their volunteer responsibilities seriously, and they’re eager for information that will help them be better stewards of their associations.

To that end, we’re alerting everyone that it’s imperative that we ask Governor Scott to veto SB 408, which would allow insurers to raise rates up to 15% without getting permission from the state. Backers say the insurance market is broken, we say you don’t fix it by breaking the backs of the associations and homeowners who are struggling to keep from going into foreclosure. Thanks to member Harvey Wolfman for sending us the piece via e-mail from TampaBay.com. “The Buzz.”

Contact the Governor at www.myflorida.gov and click on Contact Governor Scott.

Hard to believe hurricane season is nearly here, which means it is time to get ready for the worst by preparing your condo, home and community for the worst.

Five things to consider:

Protect  your condo and home, but also protect your neighbors’ home: Remove planters, lawn furniture, lawn gnomes from your yard as a major storm approaches to make sure they do not become projectiles that can damage property and people.

Lend a hand: You may be busy putting up your own shutters, for instance, but try to find time to help a neighbor. Pay particular attention to elderly neighbor or anyone with a medical condition, as well as those who live alone. Getting your home ready early will allow time for you to check in with neighbors. Helping to keep vulnerable neighbors (and their homes) prepared properly is the right thing to do, and it can help lessen damage to the whole community in the long-run.

Read your insurance documents one more time: Make sure you know what is covered and not on your premium. You may think you know, but reading the documents, including that darn fine print, beforehand is just plain smart. Learning after the fact that you have a huge deductible (which you forgot you changed to save money last year) can lead to heartbreak and financial doom. Also, make sure to keep your insurance and other important documents safe. Place in a safe deposit box, or at least a water-proof container.

List your emergency contacts: Now is the time to make sure you have all of your emergency contacts (family, friends, doctors, pet shelters, etc.) listed somewhere safe. Hedge your bet, create multiple lists. Leave one or two in a plastic bag, type them into your computer, laptop and all family smartphones.

Contact your association board: Find out the rules for putting up shutters, ask about a community disaster plan, volunteer to help for duties before and after a storm strike. You may be able to walk the neighborhood to make sure neighbors prepare their homes properly, or after the storm to help find out what damage or injuries occurred. You are not alone, you live in a community in which neighbors depend on each other.

What do you say? Do you have your own tips to share? Does your community have a safety plan you rely on and are proud of? Send an email to dvasquez@sunsentinel.com.

Also, check out my fellow blogger Gary Poliakoff’s recent post on community hurricane preparedness.

Tsunami in Japan, tornados in Alabama, flooding in Mississippi River; Hurricane Season is just around the corner.  Community Associations need to develop a disaster plan without further delay.  Based upon first hand experiences, in the aftermath of Andrew, Opal, Charley, Ivan, Wilma, et al., I wrote a pamphlet titled, “Disaster Recovery and Planning,” which is available, free of charge, on line at -http://www.newneighborhoodspublishing.com/docs/DisasterRecoveryBooklet.pdf.

The key to being prepared are the following recommendations:

1)      Designation of a Disaster Coordinator
2)      Designation of an Information Facilitator
3)      Create a photographic record of the premises and CDs of the association book and records.
4)      Maintain adequate insurance; that which complies with the mandates of state law.
5)      In the aftermath of a storm, move quickly to secure the premises from criminal acts and mitigate damages by:

a)      Drying in “or” shoring up” the premises
b)      “Drying out”
c)      Debris removal

6)      Include within the five (5) phases of reconstruction:

i)        Project planning / scheduling
ii)       Construction bidding
iii)     Construction negotiations
iv)     Construction / rehabilitation
v)      Project completion / close out

Remember to file insurance claims in a timely manner and DO NOT file false claims that will result in the association waiving its entire claim.

Next Thursday, I’ll discuss the Association’s Emergency Powers.

The Broward Coalition regularly gets requests from members looking for firms that others have had good experiences with, and we always send out a “Member needs assistance” blast asking for recommendations. We’ve had feedback on bankers, concrete restoration, engineering, paving contractors, painting, piping and association management, to list a few.

Jim Lord, president of Townhomes of Oriole, made an excellent suggestion that we’re going to follow up on, that we establish an online database that only members can access. It would maintain at a minimum, vendors, specialties, job type/description, satisfaction rating, and consent by members to be contacted about their experiences. We like to give information and help in a positive way whenever we can.

I’m going to send out a blast asking for input on the plan, suggestions for additions or changes, and of course names of vendors that our members have had good relationships with. This is just one example of how we work together to help one another with the myriad of issues association boards have to deal with.

We’re very lucky that we have such an enthusiastic and positive group of members, and we’re always looking for ideas that help make associations as well as our community stronger and better. I can’t imagine doing all that we do without the kind of people that we’ve been blessed with, who always answer the call for help, advocacy, and hard work. We take every opportunity to thank them for everything they do, because without them, we couldn’t have accomplished even a quarter of our goals. Once the establishment realized how many people are vitally interested in making life better not just for associations, but for all citizens of Broward, our positions are taken very seriously.

And that’s what the Coalition’s mission has always been.

Do friends let friends buy Condos? That was the message on the bumper sticker on the car in front of me last week. It made me chuckle but then made me think a little longer about what went into the sentiment.

 Buying a condominium doesn’t have to be a scary or mysterious process and, like planning a wedding without thinking about the potential decades of marriage to follow, deliberation needs to be given to the overall lifestyle choice before signing on the dotted line.

 What do you need to think about if you are considering a condominium purchase?

Perhaps the first item on your “To Do” list is to check to see if the condominium community you are considering is FHA approved. In 2009, the Federal Housing Administration announced that it would insure loans on condos only in developments where at least 50% of the units are owner occupied and, for new developments, where at least 30% of the units are already sold. The rules for FHA approval are even tougher for Florida condominiums. If you plan to use an FHA-insured loan for your condominium purchase, you can check if the community is FHA approved at https://entp.hud.gov/idapp/html/condlook.cfm.

Next you should consider if you can easily afford the monthly maintenance fee for your new condominium as well as any unexpected special assessments that might crop up. You certainly can’t predict if a hurricane will hit your new home months after purchasing it but you can investigate whether or not the community has reserves for the roof, exterior painting, paving and any other item for which the deferred maintenance or replacement costs exceed $10,000. If the association members have routinely waived or underfunded reserves, please know that this puts you at risk for a special assessment some time in the near future.

 Is the community mostly owner or tenant occupied?If that dynamic makes a difference to you, find out ahead of time. Just as important, if you plan on renting out your condominium at some point check to see how permissive or restrictive your community’s rules on leasing are. In that same vein, other lifestyle factors which are important to your happiness or livelihood such as owning a pet or pets, driving a commercial vehicle, running a business out of your home, etc. all demand a careful review of the association’s governing documents to be sure you can live within the community’s framework. If you cannot, don’t count on changing the status quo after you move in; better to find a community that meets your current and future needs in this regard. Also, don’t count on the fact that the documentary restrictions you find in place at the time of purchase will always stay that way. Association members can and often do vote to change important restrictions and you just might find yourself on the losing end of that vote.

What kind of delinquencies is the community currently experiencing? Again, the answer to this question will impact you in terms of the burden you will be expected to carry. While you are not entitled to a copy of the association’s budget, your seller/owner is and should provide a copy to you as well as proof of the association’s insurance coverage and information about association deductibles which will again impact your wallet as a new owner.

Finally, talk to a few of the residents you might encounter and look at the community bulletin board, newsletter and/or elevators. Does there seem to be a pervasive feeling of distrust or unease? Is the bulletin board littered with demands for a board recall or accusations of misuse of association funds? If you request your seller/owner to give you a limited power of attorney to attend a specific board or membership meeting, you will have a rare but important opportunity to see how well attended that meeting is, what the hot button topics in the community might be and how the board communicates with those in attendance.

Like any real property purchase, buying a condominium is an important step and can impact your future happiness. If you do your homework and buy in a community that fits your needs, the answer to the question “Do friends let friends buy condos?” is a resounding yes!

The Florida House and Senate have passed the latest reform bills, which will soon be sent to the Governor’s office for his signature or veto. If he does nothing, the bill still becomes law.

The reforms, if passed into law, will make life harder for delinquent owners by banning them from serving on boards and forcing landlord/owners to allow tenants to pay full rent money to the board until all debts are paid. They will also make it easier for homeowners in HOAs to speak up about items the board is considering at owner meetings.

Among the highlights:

Condos:

Will clarify that associations can now demand full rent from tenants in delinquent properties as opposed to just the current assessment amount.

Will make sure landlords cannot penalized a tenant for paying rent to the association to cover delinquent payments on behalf of the unit owner/landlord.

Will allow condo board members to submit proof of attending state-approved education courses in lieu of signing a form certifying they have read their documents and Florida law.

Will allow boards to ban delinquent owners from common areas, such as pools and club houses, without holding a hearing beforehand.

Makes clear that when an owner’s voting rights are suspended, the quorum requirement is reduced by the number of such suspended voters so as to safeguard the ability to achieve a quorum.

HOAs:

Will create a form letter for homeowners communities (along with condos and co-ops) to be sent to tenants explaining their obligation to pay rent to the association to cover an owner’s delinquent payments.

Will prohibit associations from cutting certified or franchised services to individual delinquent owners, including Internet and cable TV services.

Will ban felons from serving on the board, which would mirror current condo law.

Will allow owners to speak at board meetings on any item on the agenda, no longer requiring a petition from a number of owners to do so.

What do you say? Do you agree with such law changes? Do you disagree? Send an email to dvasquez@sunsentinel.com.

Recently this paper posted an answer to the question, “Can a Condo Board embarrass a unit owner by posting a late notice for maintenance payments on his front door?”  Unfortunately, the answer posted was “yes.”

I disagree. This answer is wrong on many levels. There is no Florida statute that requires or even authorizes associations to publicly post delinquency notices on a property owner’s door.  The statute erroneously cited in defense of this practice is Fla. Stat. § 718.121.  This statute states that the notice (of intent to file a lien) shall be deemed delivered upon mailing. Delivery clearly means delivery by mail.   (That is also consistent with the law for homeowner’s associations).  The purpose of this statute is to provide notice to the homeowner – not to the pizza deliveryman.

Public posting of delinquency notices exposes the association to liability.  While the federal Fair Debt Collection Practices Act would not apply to associations, the Florida Consumer Collection Practices Act (FCCPA) does.  This Act specifically prohibits such practices.

Public posting may also provide grounds for a lawsuit against the association for invasion of privacy.   This is not based on the constitutional right to privacy, because a community association is not a governmental agency.  Instead, it is a cause of action against a private person (or in this case, corporation) for the public disclosure of truthful private facts that a reasonable person would find objectionable.  The disclosure must be of the type not ordinarily made public – that is, not newsworthy to the public.  Even if disclosure of delinquencies is newsworthy to association members, it is not newsworthy to the pizza deliveryman, FTD florist, or mail carrier.

People may disagree about the wisdom of public shaming.  Frustrated homeowners paying the tab for their delinquent neighbors might even wish we could revive the scarlet letter and medieval stockades.   I sympathize with this frustration.  However, condo boards should be aware that posting delinquency notices on homeowners’ doors is asking for trouble.   It is not legally defensible.    It is also not strategically smart.  There are more productive (and safer) ways to recover late assessments.