As many of you know, Florida’s legislators, in a special session last year, attempted to respond to the tragic collapse of the condominium in Surfside with changes to the laws governing many community associations. Those changes may have been well-intended but created all kinds of headaches for condominium and cooperative associations and the unit owners, board members and managers of these communities.

Unit owners, board members and managers in resident-owned manufactured housing and RV communities found themselves struggling to answer the questions of whether–and to what extent–the “Surfside legislation” applied to their communities. Most, if not all, mobile home and RV communities do not have any buildings three stories or higher. Did these communities still have to have “milestone inspections”? Did they have to obtain “structural integrity reserve studies”? And what about their reserves? Did communities that did not have to have “milestone inspections” or “structural integrity reserve studies” have to provide for the reserve items now listed in Florida Statutes Section 719.104(1)(k) in their budgets? And could the unit owners no longer waive the reserve requirements?

History teaches us that in Florida, for every piece of well-intended and sweeping legislation, there is at least one “glitch bill” that swiftly follows. In the case of the “Surfside legislation”, that “glitch bill” is this year’s Senate Bill 154, which was signed into law by the Governor on June 9th and becomes effective unless otherwise provided immediately.

Here are some observations for our resident owned manufactured housing and RV cooperatives (and similar language can be found in the relevant provisions of Chapter 718 for those of you in manufactured housing or RV condominium associations):

  1. Florida Statutes Sections 553.899(2)(a) and (3)(a) now provide that communities with no buildings three stories or more in height are not required to have a “milestone inspection.”
  2. Florida Statutes Section 719.106(1)(k) provides that no “structural integrity reserve study” is required in communities with no buildings three stories or more in height (and the definition of “structural integrity reserve study” can be found in F.S. Section 719.103(24)).
  3. The requirement that an association’s budget provide that reserves be maintained for any of the items identified in F.S. Section 719.106(1)(k) seems to apply only to budgets adopted by an association that is required to obtain a “structural integrity reserve study.” This would appear to clarify that communities with no buildings three stories or more in height don’t need to provide for any of those items in their budgets except for those items that would otherwise already have to be included in their budgets.

There are two other important changes to note: First, the provisions in regard to the annual vote required to waive or underfund the reserves that would otherwise be required in the association’s budget under F.S. Section 719.106(1)(j) have been changed to require that a majority vote of the total voting interests in the association is now required to waive or underfund those reserves. This revision represents an increase from the former voting requirement of a simple majority of the quorum present in person or by limited proxy at the meeting. Also, in communities where no “milestone inspection” or “structural integrity reserve study” is required, all contracts for sale or resale of a unit entered into after December 31, 2024, must contain a statement, in conspicuous type, that indicated that the association is NOT required to have that milestone inspection or structural integrity study.

Let’s hope this “glitch bill” in fact makes our lives easier…we’re going to need all the help we can get over the next few months…as we’re already monitoring a developing storm (or two) out in the Atlantic!

Disaster assistance

Responding to the devastating 2021 collapse of the Champlain Towers South building in Surfside, lawmakers approved making property tax rebates available when residential properties are rendered uninhabitable for 30 days. During the December 2022 special session, lawmakers passed a measure (SB 4-A) to offer similar rebates to property owners who sustained damage in Hurricane Ian and Hurricane Nicole. Affected property owners will be able to apply to their county property appraiser between Jan. 1 and April 1st.

Our thoughts and prayers go out to everyone who has been affected by Hurricane Ian. As you probably know, Southwest Florida bore the brunt of the storm and has suffered catastrophic losses. At this time, power remains down for more than 50% of the residents from Manatee County down to Collier County. First and foremost, as Southwest Florida mitigates the damage and dangers post-storm, a few things to keep in mind are:

  • Avoid downed power lines: Do not touch or drive over downed power lines. Always assume a downed power line is unsafe and contact the power company and emergency personnel.
  • Be aware of areas where floodwaters have receded: Roads may have weakened and could collapse under the weight of a car.
  • Use a generator safely: Keep generators far from your home. Never use a generator inside a home, basement, shed or garage even if doors and windows are open as these could allow carbon monoxide to come indoors.
  • Stay out of buildings that have structural damage: Do not enter into buildings that have had any structural damage until it has been professionally inspected to ensure its safety.

Our National and State Agencies have resources available to those who have suffered loss due to the storm. Below are some links to the many resources that are available:

Together we will make it through this disaster. Our thoughts and prayers are with you.

Greetings,

Hurricane Ian is rapidly intensifying and anticipated to hit the Florida coast. In advance, we’d like to extend the following reminders:

1. Mandatory evacuation order means what it says. Do not endanger your life or the lives of others by ignoring that order. Gather your important documents and prescriptions in the case of an evacuation. If you have a pet, be sure to note which shelters are pet-friendly. If you have an immediate housing need, text SHELTER and your ZIP code to 43362 to find a FEMA shelter in your area or visit FEMA.gov. You may also visit the Florida Division of Emergency Management at FloridaDisaster.org/shelters/ for an index of Florida shelters by county.

2. Unless the clubhouse is a Red Cross certified hurricane shelter, it should NOT be used as a “safe place”. And see number 1 above.

3. Let the residents know now that if they have any pre or post storm concerns they should only contact the person(s) designated as the “point person(s) to be the liaisons between park management and the residents.

4. Now is the time to secure all items that could become airborne missiles.

5. Check on your elderly neighbors.

6. Consider doing a full video walk through of each room for insurance purposes.

7. Keep your emergency supply kit in a place you can easily access. Stock up on storm supplies early, including food, extra water, flashlights, and batteries.

8. Stay in tune with local and statewide alerts by listening to radio or TV.

Please stay alert and safe!

Sincerely,
Lutz, Bobo & Telfair, P.A.

Mobile Home Parks have long been attractive investments due to their steady cash flow stemming from the regular payment of lot rents. National park operators, real estate investment trusts and pension funds have been buying “mom and pop” parks over the last several decades leading to an overall industry consolidation. As the industry becomes more and more consolidated, investors have turned their attention to purchasing cooperatives. And they are selling for big money! As posted in the Sarasota Herald Tribune, the Country Lakes Village cooperative recently sold for close to $70million dollars.

See https://www.heraldtribune.com/story/business/2022/08/09/manatee-county-manufactured-home-community-sells-70-million/10265234002/

The transaction usually begins with a “Letter of Intent” mailed to the association officers. The Letter of Intent presents the purchasers interest in purchasing the park. The purchase price will usually be broken down into a “per share price” of, say for example, $200,000 per share. Note that once the association sells the park, the cooperative is terminated and all residents will transform from shareholder owners to lot renters. To address this change, the Letters of Intent will usually present a proposed annual lot rent, capped to a fixed annual increase for the lifetime of the current residents. The interested purchaser will usually promise to provide community-wide amenity upgrades, in amounts upwards of several millions of dollars as well. Those upgrades might include clubhouse renovations, new landscaping, pool renovations, installation of pickleball courts, and the like.

On receipt of such Letters of Intent, Association officers have some big questions to answer: what is my fiduciary duty to the shareholders in connection with this offer? will the other shareholders be interested in selling? what is the appraised value of the park and is that value accurately reflected in the proposed purchase price? what shareholder and director approvals are required in order to sell the park and terminate the cooperative?

In follow-up posts, we will dive into those issues in greater detail. In the meantime, if you receive a Letter of Intent to purchase your park, you should contact your legal advisor without delay to help you begin working through the various issues a Letter of Intent presents.

Good morning, everyone!  Hope all of you are enjoying the summer whether you are still in Florida or “up North”.

Just a brief blog post to let you know that the DBPR has updated the fees that can be charged for estoppel certificates.

A fee of not more than $299 can be charged for preparation and delivery of an estoppel certificate that’s not a “rush” delivery.

If the estoppel certificate is requested on an expedited basis and delivered within 3 business days, an additional $119 can be added to the fee.

If the unit or parcel has delinquent amounts owed to the association, an additional fee not to exceed $179 can be added.

The fees for multiple units or parcels owned by the same owner also have been increased and those fees (as well as the others mentioned above) can be viewed at this link to the DBPR site:  http://www.myfloridalicense.com/dbpr/lsc/documents/ESTOPPEL_CERTIFICATE_FEES.pdf

The statute in Chapter 719 governing estoppel certificates for cooperative associations authorizes the DBPR to adjust the fees for these certificates every five years so, unless there is a change in the statutes, the next adjustment will occur in the summer of 2027.

If you have any questions, please feel free to contact our office.

Stay safe and healthy and let’s hope for a quiet and boring hurricane season!

We’ve made it through the first month of 2020!  February will be very busy as I am offering board certification training for prospective and current Directors of cooperative associations (governed under Chapter 719 of the Florida Statutes) on the following dates:

Our board certification training sessions have always been very well attended and we expect more of the same for these events.  If you wish to attend one of these presentations (or know of someone who wishes to do so) please contact me at sgordon@lutzbobo.com and I will provide you the additional information to RSVP for this training.  As always, you will find both refreshments and networking aplenty!

Earlier this week, the U.S. Department of Housing and Urban Development (HUD) published its latest guidance on how housing providers should deal with a request for an assistance animal as a “reasonable accommodation” under federal Fair Housing laws.  Discussing this latest guidance with your association attorney might be a good item to put at the top of your board’s “to do” list.

I hope to see many of you this month at board certification training or at the annual meetings I’ll be attending.

Labor Day has come and gone, several tropical systems are swirling in the Atlantic (you may recall that all of Florida was in panic mode awaiting Irma this time last year) and our snowbirds will be returning before we know it.  Seems like a good time to discuss some of the changes made to Chapter 719 by Florida’s legislature earlier this year–all of which became effective on July 1, 2018:

  • Florida Statutes Section 719.104(2)(a) was revised to provide that the book or books containing the minutes of all meetings of the association, of its board of directors, and of its unit owners now apparently must be retained forever as the provision that stated “which minutes shall be retained for a period of not less than 7 years” has now been deleted.  That same deletion occurred in the paragraph relating to the retention of the association’s accounting records which now must also apparently be retained forever.
  • Section 719.104(2)(a) was also revised to include “electronic records” relating to voting as part of the documents related to voting by unit owners that must be maintained for a period of 1 year after the date of the election, vote, or meeting to which the document relates.
  • Section 719.104(2)(b) now clarifies that the association has 10 working days (rather than 5 working days) after its board or designee received a written request to inspect or copy official records to make those records available.
  • Co-owners of a unit in a cooperative with more than 10 units can no longer serve as board members at the same time unless those co-owners own more than one unit or unless there are not enough eligible candidates to fill the vacancies on the board at the time of the vacancy.   This revision to Section 719.106(1)(a)1 follows a similar revision to Florida’s condominium association statutes that occurred several years ago.
  • Section 719.106(1)(c) was amended to allow for board members to use email as a “means of communication” with other board members but board members may not cast a vote on an association matter by email.  I have a feeling that this amendment may create all kinds of issues–not the least of which will be whether or not these email communications might in some cases become part of the “official records” of the association.  I’m also concerned that these email communications between board members may end up becoming the “real” board meetings and will be very interested in seeing whether this provision creates new headaches for board members and managers of resident owned communities in our state.

Stay tuned and I’ll be posting Part II of the 2018 revisions to Florida’s Cooperative Association Laws later this month.

 

I’m typing this blog entry on an absolutely beautiful afternoon in Sarasota. Sunshine, low humidity and temperatures in the mid-seventies. It’s hard to believe that it’s been just six weeks since Hurricane Irma rampaged through our state and disrupted our lives.

All in all,most of the resident owned communities we work with were spared the worst of the storm–although several of our ROC’s will be dealing with the challenges of post-Irma recovery for at least the next few months.

Thankfully, we have not heard of any storm related injuries but once again would stress that managers and board members take all steps needed to make sure that residents understand that, unless the community’s clubhouse is a Red Cross Certified Shelter, the clubhouse should not be used as the place to "ride out the storm".

Sadly, but not unexpectedly, Hurricane Irma (and Hurricane Harvey), brought out those human vermin who prey on those in need. Here’s a link to an article about just some of those Irma/Harvey scams.

While I’m on the topic of scams, I want to highlight two that just make my blood boil:

  1. If you’ve recently purchased your home or unit, you may receive an official looking notice from a company or "office" offering to help you obtain a copy of your deed or assignment of lease. All you have to do is send this company or "office" a check for a "service fee". We were provided with a copy of one of these notices and the check requested was for $89.00. Do yourself a favor if you receive this (or a similar) notice–throw it out. You don’t need a copy of your deed or assignment of lease and if you really want a copy, you can go online and print the recorded document you want for free or make a trip to your county’s recorder’s office and you’ll pay $1 per page. You do the math.
  2. I’ve blogged about the "service dog" scam before but it’s not going away. In fact, it’s getting worse. It astounds me that people are willing to throw money away for diplomas, identity cards, collars, etc. that wrongly identify their pet as a "service animal". Why would anyone pay $100 or more for pieces of paper or cloth that are worthless? I’m going to repeat this again and again until it sinks in: A "service animal" under the Americans With Disabilities Act is defined as a dog (and in certain limited situations, a miniature horse) that has been individually trained to do work or perform tasks for an individual with a disability. The task or tasks performed by the dog must be directly related to the person’s disability. In addition, the Americans with Disabilities Act does NOT require service animals to wear a vest, ID tag, or specific harness.

So let me break this down one more time: It doesn’t matter whether or not you’ve paid $150 for a piece of paper "certifying" that your pet is a "service animal". Either you have a dog that has been individually trained to do work or perform tasks that are directly related to your disability or you don’t. Whether or not you’ve got that "certificate" is irrelevant. And one last thing–which I’ve also mentioned before–Florida Statute Section 413.08(9) makes it a crime for anyone to knowingly and willfully misrepresent that he or she is using a service animal.

Let’s put an end to these two scams once and for all!