Briny Breezes is a resident owned manufactured housing cooperative located in Palm Beach County.

Two of the community’s sea walls that protected the cooperative property needed repairs and upgrades.   The directors of Briny Breezes, Inc., the cooperative association that owns and operates the community, hired an engineer who reported that the required repairs and upgrades to the seawalls would cost approximately $150,000.

While there were adequate funds in the association’s reserve account to pay for these repairs, Briny Breeze’s governing documents clearly prohibited the association’s board of directors from spending more than $30,000 for capital improvements or spending more than $30,000 for replacement of capital assets in any fiscal year.  According to the association’s governing documents, the affirmative vote of at least 51 per cent of the members was required for these expenditures.

Earlier this year, Briny Breeze’s manager asked the Division of Florida Condominiums, Timeshares, and Mobile Homes (the "Division") to determine whether the association’s board of directors could use the reserve funds to pay for the seawall repairs that were needed to protect the cooperative property without obtaining the approval of the association’s members.

The Division, in its Declaratory Statement issued this May, held that the association could use its reserve funds to make the needed repair to the seawalls without a vote of the membership.

The Declaratory Statement cited Florida Statutes Section 719.104(5), a federal bankruptcy court decision interpreting Florida law, several decisions of our state appellate courts and a decision rendered by one of the Division’s arbitrators. 

The Division noted that , even if expenditures result in alterations or improvements to the community’s common elements, it is within the board’s authority to authorize these expenditures without member approval where the expenditures for the alterations or improvements are needed to protect the common elements.

At the same time, the Division did caution that an association’s directors might very well be precluded from unilaterally spending money for upgrades that constituted material alterations to the common elements and went beyond the repairs required to protect the common elements.

The Division concluded that, while the "safest course for the board is to get a unit owner vote", the board should not be limited to "simply repair the sea wall to protect the common elements."

Hopefully, this Declaratory Statement will provide ROCs with some guidance in the future.

I’ll be discussing issues affecting aging members of resident owned communities this week on "Community Matters".

I’ve written several entries on the risks that ROCs take when copyrighted music is played in their communities.

Last year, the National Association of RV Parks & Campgrounds ("ARVC") introduced a new benefit for its members–a combined music licensing agreement with two of the three major music license companies, ASCAP and BMI.

In connection with this new benefit, the ARVC prepared a very concise and informational "FAQ" sheet for its members.

While most of Florida’s ROCs are not members of the ARVC, I hope you’ll find that FAQ sheet–aptly titled "What You Need to Know About Music Licensing" educational and useful.

On last Saturday’s "Community Matters" radio show, I discussed hurricane preparedness with Ed McCrane, Sarasota County’s Emergency Management chief, and then spoke with State Representative Mike Fasano about the need to change the policy of the Florida Hurricane Catastrophe Fund, which currently may exclude some condominium developments from the Fund’s reinsurance coverage–which has the potential to substantially and negatively impact condominium associations and unit owners throughout the state.  The podcast of that show is now available at the "Community Matters" site.

The recent revisions to Florida’s laws governing condominium associations, cooperative associations, and mandatory homeowners’ associations updated the procedures for producing, inspecting and copying an association’s "official records".

Effective July 1, 2013, an association in Florida’s resident owned communities can satisfy the requirement that it make its official records available for inspection and copying by:

  • making the records available to a member electronically via the Internet or
  • allowing the records to be viewed in an electronic format on a computer screen and printed upon request

Board members and managers in resident owned communities should note that the association is not responsible for the use or misuse of the information provided to a member or that member’s representative when it complies with the requirements to produce official records for inspection or copying unless the association has an affirmative duty not to disclose that information–for example, if that information falls within the category of "protected" official records.

In addition, associations must now allow a member or his or her authorized representative to use portable devices, including smartphones, tablets, portable scanners, or any other technology capable of scanning or taking photographs, to make an electronic copy of the official records instead of the association providing that member or his or her representative with a copy of those records.  The association may not charge that member or his or her representative for the use of a portable device. 

Again, board members and managers should remember that certain information–while part of the association’s official records–is not to be produced to members and great care must be taken to carefully inspect all records and to remove or redact all information that is required to remain confidential or otherwise protected before those records are produced to the member or his or her representative.

When faced with requests to produce records for inspection or copying, an association should strongly consider consulting with its attorney before responding to that request.

We’ll be discussing hurricane preparedness and Citizens Insurance this Saturday from 11 to noon on Community Matters and I hope you’ll listen live or by podcast.

As many followers of this blog may already know, House Bill 87 was signed by Florida’s Governor last Friday.  This bill provides community associations with some hope that the foreclosure process–which seems to take an eternity before it concludes–will be expedited and that an association can have a meaningful voice in the foreclosure action. 

I discussed House Bill 87 and several other bills affecting resident owned communities last weekend with lobbyist Travis Moore on our inaugural hour of  "Community Matters," which airs every Saturday from 11 a.m. until noon on Sarasota TalkRadio, WSRQ–1220 AM and 106.9 FM.

In addition to providing our listeners with an explanation of House Bill 87 and its effect on the foreclosure process, Travis summarized a number of other provisions, including the following:

  • Changes to the fees to be paid by communities to the State of Florida for submerged land leases
  • A requirement that mandatory homeowners associations be registered with the State
  • Updates to statutes governing a unit or parcel owner’s right to copy the association’s "official records" which will expressly allow for such copying to occur by use of an iPad, tablet,  iPhone or similar device.
  • Provisions clarifying what information about a unit owner or parcel owner an association can safely include in its membership directory
  • Amendments to the statutes governing cooperative associations that will provide those associations with the same protections in regards to personnel matters and personnel records as found in the statutes governing condominium and mandatory homeowners associations
  • An additional amendment to Chapter 719 of the Florida Statutes requiring newly elected or appointed board members of cooperative associations to meet the same certification or education standards as board members in condominium associations

If you’d like to hear last Saturday’s show–here’s the link to the podcasts for "Community Matters": sarasotatalkradio.com/community-matters/  .  Just click on "read more" and you’ll find the podcast.

We’ll be discussing hurricane preparedness for the next two weeks. I hope you’ll listen live or to our podcasts and I’ll look forward to your questions and your suggestions for future topics for "Community Matters".

I just finished speaking with the manager of one of the resident owned communities in our area.

An email was received at the community’s email address, allegedly from the Federal Trade Commission.  The subject of the email was "NOTIFICATION OF CONSUMER COMPLAINT" and the email contained a very official looking document advising that a customer had complained "about your business and believes you have contravened the Consumer Credit Protection Act (CCPA)".

The document further stated that "Federal Trade Commission has initiated a formal investigation into this complaint" and asked the association to "consider the details of the enclosed letter"–which conveniently did not accompany the email.   Instead, the document advised the association that the letter (which contained the complaint) could be downloaded from a website listed in the document.

The document advised the association that it was "welcome to contact us regarding this matter" using a form that could be downloaded from another website address.

The document closed with the address of the FTC and its website and warned the association that "the FTC is required to post information about businesses who fail to respond to consumer complaints".

Our firm’s technology professional quickly determined that the email was yet another scam and located this link that describes the scam in detail.  

You’ll note that the Federal Trade Commission advises the recipients of this scam that they should not click on the links to the websites listed  in the email.

Managers and board members of resident owned communities should always be alert for these scams and use common sense–after all, it’s doubtful that, even in this day and age, any agency of the federal government would choose email to notify a business of a consumer complaint.

Our best wishes for a happy and healthy holiday weekend.

Earlier today, I received an email from the Community Association Institute’s Florida Legislative Alliance ("FLA") alerting me to bills to be introduced in the upcoming legislative session in Tallahassee.

According to the email, Senate Bill 286 and House Bill 575 "will have a serious negative impact on community associations and other consumers of design professional services."

The email from the FLA continues:

"As presently designed, these bills will permit surveyors, engineers, landscape architects, architects and interior designers ("design professionals") to eliminate all personal liability for economic damages caused by the negligent performance of their design professional services pursuant to a contract with the consumer.  This is done by them simply placing a ‘prominent statement (in their form contract), in uppercase font that is at least 5 point sizes larger than the rest of the text’, and, pursuant to this legislation, an individual employee or agent may not be held individually liable for negligence."

According to the FLA, supporters of these bills argue that consumers will take steps to re-impose liability on a "design professional" upon seeing that "prominent statement" in the contract.  However, this argument–according to the FLA–"completely ignores human nature" and the fact that many, if not most, consumers (including ROC boards) sign form contracts without even reading those contracts.

In addition, while these bills do not protect design professional companies, the FLA contends that design professional companies can easily "hide" assets by placing them in other entities–thus eliminating any realistic chance of a consumer or community association recovering any amounts when suffering damages as a result of the negligence of a "design professional".

The FLA’s email summarizes SB 286 and HB 575 as "an unfortunate attempt to shift the ultimate negligence liability burden from the design professionals to the consumers."

If you agree with the FLA’s analysis of these bills, the FLA urges you to contact your state senator and state representative as well as the members of Florida’s Senate Judiciary Committee and House Civil Justice Subcommittee to request that they oppose any attempt to reduce liability for these "design professionals".   The FLA asks that you include a reference to SB 286 in your correspondence to Florida’s Senators and refer to HB 575 when contacting Florida’s Representatives.

Just a reminder–if you’re a ROC manager or board member and haven’t already sent in your reservation for the Third Annual Community Association Festival at the Venice Community Center on Wednesday,  February 20, there’s still time!  Just send an email to deanna@sleuthpt.com or call 941-809-2031.  Remember, the event’s free, and that includes a continental breakfast, a barbecue lunch, and a lot of information and networking opportunities.  I hope to see you there–just wear your favorite Hawaiian shirt!
 

 

I always enjoy sharing positive stories about resident owned communities and the August 22 column by Eric Ernst in the Sarasota Herald Tribune is a great example of cooperative living at its best.

Country Club Estates in Venice is in the midst of a very exciting project that will enhance and increase its value and desirability both on a short term and long term basis.   The unit owners’ commitment to the future of Country Club Estates is indeed "good news for affordable housing in Venice."   Kudos to the board, the manager and all of the members of Country Club Estates!

So much for the good news.

Here’s an incredible story from a recent edition of the New York Post, entitled "Co-op Brawl":

Apparently, the president of an apartment cooperative located on Fifth Avenue in New York was upset because the representatives of the estate that owned a penthouse apartment in the building did not accept her "low ball" offer to purchase the unit.  The president and her board then allegedly decided to sabotage an existing agreement to sell the penthouse for 27 million dollars by unilaterally deciding that the apartment’s "prime selling point"–a private wrap-around terrace with city and Central Park views–can be used by everyone in the building to get onto a newly proposed roof deck.

Of course, a lawsuit has been filed by the sellers seeking 5 million dollars in damages and a court order declaring that the terrace (which is larger than the unit’s interior living space) is private.

Not surprisingly, none of the lawyers involved in this ugly legal battle returned calls from the newspaper seeking comments.

Members of Florida cooperative or condominium associations should rest assured that neither the size nor the configuration of a condominium unit or a cooperative unit can be changed in any material way without the approval of the affected unit owner.

Now that we’re well into the month of October, preparations for this season’s set of seminars are under way and I’ll be posting information within the next few weeks. 

I hope everyone had a safe and restful "off season" and look forward to seeing you soon!

This morning’s local edition of the Sarasota Herald Tribune featured a column by Eric Ernst with the headline "Tenants Will Pay for Higher Tax Bills".

Owners of real estate interests in Florida received their annual TRIM ("Truth in Millage") notices last month.  While a TRIM notice is not the actual real estate tax bill,  the notice lets an owner know what value the county appraiser places on his or her property.

In Sarasota County, there was an overall decrease of approximately one per cent in property values and most owners of real estate in Sarasota County may not see much of an increase (if any) in their tax bills this year.

However, mobile home owners who rent lots in Sarasota County’s investor-owned manufactured housing communities may have to bear the brunt of real estate tax bills to be sent to their park owners that may be over sixty per cent more than last year’s.

Here are the increases as shown in the TRIM notices for several of the investor-owned parks mentioned in the story:

  • One park in Venice showed an increase in estimated land value of almost 22 per cent per lot
  • Two others in Venice showed per lot increases of almost 55 and 66 per cent
  • The TRIM notice for a park in Sarasota increased the value for real estate tax purposes by almost 67 per cent

The article describes the rationale for the substantial increases in value of these parks and briefly discusses the difficulties that any park owner or home owner will face in appealing the property appraiser’s decisions.

Members of resident-owned communities can take comfort in the following paragraph from this story:

"We’re not talking about the parks in which residents own home and the land under them.  The value of these properties has mirrored that of single-family home in the eyes of the county appraiser."

My understanding is that at least one other county in our state has taken an approach with its TRIM notices this year similar to Sarasota County’s.

Just one more reason for ROC members to be happy with their decision to be part of their community’s "ownership group"!

I hope you enjoyed your Labor Day weekend and that you and you escaped our brush with Isaac with little or no damage.

 

 

As all Floridians know, our hurricane season doesn’t really get under way until August and we’re currently watching a very large systemTropical Storm Isaac–slowly develop.  

At this point, it’s anyone’s guess whether and to what extent our communities will be impacted by this system.

ROC managers (and board members that remain in Florida during the "off season") should be familiar with the drill but nonetheless, here are a few reminders:

  • Pay attention to broadcast media and in particular the updates issued by the National Hurricane Center.   During these situations, rumors run rampant–particularly on the internet–but the NHC’s website is an invaluable asset when the tropics begin to churn.
  • As I have preached in past years, unless the clubhouse in your community is a Red Cross certified shelter, your residents should not be congregating in that clubhouse when threatened by a hurricane.  Do not allow your residents to use the clubhouse to as a shelter or have a "hurricane party" when tropical systems threaten.
  • A mandatory evacuation order means just that–and if you are in a community in which a mandatory evacuation order has been issued, your refusal to evacuate is a violation of Florida law.   Residents that choose to remain in their communities after being ordered to evacuate do so at their own peril–and they should realize that if they require assistance during or after the storm, emergency personnel may not be able to assist them.
  •  Now is the time for residents with pets to locate "pet friendly" shelters.  Don’t wait until the evacuation order is issued.
  • Make sure that any item on your property that could become a "missile" during a storm is brought inside.
  • Please let a relative or friend know where you are "riding out the storm" and let that friend or relative know how to contact the authorities if he or she is unable to locate you once the storm passes.
  • Be extremely careful when returning to your home after the storm.  Many injuries and deaths occur as a result of post-storm accidents.

One of the recent issues of the Florida Community Association Journal has some very good articles on preparing for and dealing with hurricanes and you can find other useful information at a number of other sites, such as the one for the Federal Emergency Management Agency.

Hopefully, Isaac will be more "bark" than "bite" and the rest of our hurricane season will be safe and uneventful.   Better to be prepared for the storm that doesn’t come our way than to be unprepared for the one that does!

Regular followers of my blog recall that I’ve discussed the challenges resident owned communities face when dealing with animals such as feral cats, muscovy ducks and black bears.

Many of our ROCs in South Sarasota County (and several in Pasco County) have struggled with the problem of another type of unwanted visitor–in this case, wild hogs.

Full-time residents of Florida know that living here requires accepting that our climate and sunshine is shared by all types of wildlife–in most cases, man and beast get along fairly well.   This "live and let live" attitude was displayed in a very entertaining article about a hive of "local" honey bees in today’s Sarasota Herald Tribune.

But what happens when the opposite occurs–and a landlord is sued when a tenant dies as a result of a reaction to fire ant bites occurring on the landlord’s property?

A recent case from Florida’s Fourth District Court of Appeals provides an answer.

A resident in a mobile home park was bitten by fire ants while walking his dog within the park and died from those bites less than two days later.

His estate sued the owner of the mobile home park for wrongful death and alleged that the park owner should have been on notice of a fire ant infestation in the area where the resident was allegedly bitten.  The park owner’s community manager testified that she was unaware of any other resident ever having been attacked by fire ants at the park and was also unaware of any fire ant infestation at the area of the park where the attack allegedly occurred.

The park owner did have an exterminator spray insecticide every other month in order to kill ants and an employee of that exterminator testified that he had no knowledge of any ant activity or reason to recommend treating the area where the alleged incident took place.

The exterminator confirmed that red fire ants are "wild animals" and that their natural habitat is outdoors in South Florida and further stated that permanently eradicating fire ants from a property would be impossible.

Other employees of the park owner testified that any visible ant mounds would be treated with granules, that several members of the parks maintenance staff would occasionally be bitten by ants and that the exterminator would be called if park residents reported "something out of the ordinary with too many red ants or anything like that."

The trial court granted the park owner’s motion for summary judgment, holding that the park owner was not on notice of a fire ant infestation at the location of the alleged attack and thus did not have a duty to guard against red fire ants.

The Fourth District Court of Appeals affirmed the judgment in favor of the park owner and cited "ferae naturae," which is a doctrine which relates back to the Roman Empire and is based on the fact that wild animals are unpredictable and cannot be controlled.

The Court stated:

"Generally speaking, in Florida, the law does not require the owner or possessor of land to anticipate or guard against harm from animals Ferae naturae unless such owner or possessor has reduced the animals to possession, harbors such animals, or has introduced onto his premises wild animals not indigenous to the locality."

Because the park owner did not harbor, introduce, or take possession of the fire ants, and attempted to treat any mounds or other infestations of fire ants, the park owner could not be held liable for the resident’s death.

The Court did warn that landowners could be responsible in regards to wild animals found in artificial structures or places where they are not normally found if the landowner knows or should know of the unreasonable risk of harm posed by an animal on its premises and if the landowner cannot expect others to realize the danger or guard against it.

So much for living in "Paradise"!