Florida Senate - 2017 SB 1520 By Senator Latvala 16-01125-17 20171520__ 1 A bill to be entitled 2 An act relating to condominium terminations; amending 3 s. 718.117, F.S.; revising the default procedure for 4 the optional termination of a condominium; requiring a 5 plan of termination to be approved by at least 90 6 percent of the total voting interests of the 7 condominium; prohibiting a plan of termination from 8 proceeding if 5 percent or more of the total voting 9 interests reject the plan; revising the period during 10 which a subsequent plan of termination is prohibited 11 from being considered after a rejection; revising 12 applicability; revising the requirement on who must be 13 paid fair market value for his or her unit after 14 rejecting a plan of termination; revising the written 15 disclosures that are required to be provided before a 16 plan of termination is presented; providing an 17 effective date. 18 19 Be It Enacted by the Legislature of the State of Florida: 20 21 Section 1. Subsection (3) of section 718.117, Florida 22 Statutes, is amended to read: 23 718.117 Termination of condominium.— 24 (3) OPTIONAL TERMINATION.—Except as provided in subsection 25 (2) or unless the declaration provides for a lower percentage, 26 the condominium form of ownership may be terminated for all or a 27 portion of the condominium property pursuant to a plan of 28 termination approved by at least 90
80percent of the total 29 voting interests of the condominium. If 5 10percent or more of 30 the total voting interests of the condominium have rejected the 31 plan of termination by negative vote or by providing written 32 objections, the plan of termination may not proceed. 33 (a) The termination of the condominium form of ownership is 34 subject to the following conditions: 35 1. The total voting interests of the condominium must 36 include all voting interests for the purpose of considering a 37 plan of termination. A voting interest of the condominium may 38 not be suspended for any reason when voting on termination 39 pursuant to this subsection. 40 2. If 5 10percent or more of the total voting interests of 41 the condominium reject a plan of termination, a subsequent plan 42 of termination pursuant to this subsection may not be considered 43 for 24 18months after the date of the rejection. 44 (b) This subsection does not apply to any condominium 45 created pursuant to part VI of this chapter until 10 5years 46 after the recording of the declaration of condominium, unless 47 there is no objection to the plan of termination. 48 (c) For purposes of this subsection, the term “bulk owner” 49 means the single holder of such voting interests or an owner 50 together with a related entity or entities that would be 51 considered an insider, as defined in s. 726.102, holding such 52 voting interests. If the condominium association is a 53 residential association proposed for termination pursuant to 54 this section and, at the time of recording the plan of 55 termination, at least 80 percent of the total voting interests 56 are owned by a bulk owner, the plan of termination is subject to 57 the following conditions and limitations: 58 1. If the former condominium units are offered for lease to 59 the public after the termination, each unit owner in occupancy 60 immediately before the date of recording of the plan of 61 termination may lease his or her former unit and remain in 62 possession of the unit for 12 months after the effective date of 63 the termination on the same terms as similar unit types within 64 the property are being offered to the public. In order to obtain 65 a lease and exercise the right to retain exclusive possession of 66 the unit owner’s former unit, the unit owner must make a written 67 request to the termination trustee to rent the former unit 68 within 90 days after the date the plan of termination is 69 recorded. Any unit owner who fails to timely make such written 70 request and sign a lease within 15 days after being presented 71 with a lease is deemed to have waived his or her right to retain 72 possession of his or her former unit and shall be required to 73 vacate the former unit upon the effective date of the 74 termination, unless otherwise provided in the plan of 75 termination. 76 2. Any former unit owner whose unit was granted homestead 77 exemption status by the applicable county property appraiser as 78 of the date of the recording of the plan of termination shall be 79 paid a relocation payment in an amount equal to 1 percent of the 80 termination proceeds allocated to the owner’s former unit. Any 81 relocation payment payable under this subparagraph shall be paid 82 by the single entity or related entities owning at least 80 83 percent of the total voting interests. Such relocation payment 84 shall be in addition to the termination proceeds for such 85 owner’s former unit and shall be paid no later than 10 days 86 after the former unit owner vacates his or her former unit. 87 3. For their respective units, all unit owners other than 88 the bulk owner must be compensated at least 100 percent of the 89 fair market value of their units. The fair market value shall be 90 determined as of a date that is no earlier than 90 days before 91 the date that the plan of termination is recorded and shall be 92 determined by an independent appraiser selected by the 93 termination trustee. For a person an original purchaser from the94 developerwho rejects the plan of termination and whose unit was 95 granted homestead exemption status by the applicable county 96 property appraiser, or was an owner-occupied operating business, 97 as of the date that the plan of termination is recorded and who 98 is current in payment of both assessments and other monetary 99 obligations to the association and any mortgage encumbering the100 unitas of the date the plan of termination is recorded, the 101 fair market value for the unit owner rejecting the plan shall be 102 at least the original purchase price paid for the unit. For 103 purposes of this subparagraph, the term “fair market value” 104 means the price of a unit that a seller is willing to accept and 105 a buyer is willing to pay on the open market in an arms-length 106 transaction based on similar units sold in other condominiums, 107 including units sold in bulk purchases but excluding units sold 108 at wholesale or distressed prices. The purchase price of units 109 acquired in bulk following a bankruptcy or foreclosure shall not 110 be considered for purposes of determining fair market value. 111 4. The plan of termination must provide for payment of a 112 first mortgage encumbering a unit to the extent necessary to 113 satisfy the lien, but the payment may not exceed the unit’s 114 share of the proceeds of termination under the plan. If the unit 115 owner is current in payment of both assessments and other 116 monetary obligations to the association and any mortgage 117 encumbering the unit as of the date the plan of termination is 118 recorded, the receipt by the holder of the unit’s share of the 119 proceeds of termination under the plan or the outstanding 120 balance of the mortgage, whichever is less, shall be deemed to 121 have satisfied the first mortgage in full. 122 5. Before a plan of termination is presented to the unit 123 owners for consideration pursuant to this paragraph, the plan 124 must include the following written disclosures in a sworn 125 statement: 126 a. The identity of any person or entity that owns or 127 controls 25 50percent or more of the units in the condominium 128 and, if the units are owned by an artificial entity or entities, 129 a disclosure of the natural person or persons who, directly or 130 indirectly, manage or control the entity or entities and the 131 natural person or persons who, directly or indirectly, own or 132 control 10 20percent or more of the artificial entity or 133 entities that constitute the bulk owner. 134 b. The units acquired by any bulk owner, the date each unit 135 was acquired, and the total amount of compensation paid to each 136 prior unit owner by the bulk owner, regardless of whether 137 attributed to the purchase price of the unit. 138 c. The relationship of any board member to the bulk owner 139 or any person or entity affiliated with the bulk owner subject 140 to disclosure pursuant to this subparagraph. 141 (d) If the members of the board of administration are 142 elected by the bulk owner, unit owners other than the bulk owner 143 may elect at least one-third of the members of the board of 144 administration before the approval of any plan of termination. 145 Section 2. This act shall take effect July 1, 2017.