Florida Senate - 2021 COMMITTEE AMENDMENT Bill No. CS for SB 1966 Ì4252488Î425248 LEGISLATIVE ACTION Senate . House Comm: RCS . 04/15/2021 . . . . ————————————————————————————————————————————————————————————————— ————————————————————————————————————————————————————————————————— The Committee on Appropriations (Diaz) recommended the following: 1 Senate Amendment (with title amendment) 2 3 Delete lines 1394 - 1520 4 and insert: 5 any applicable expenses listed in s. 718.504(21). The board 6 shall adopt the annual budget at least 14 days prior to the 7 start of the association’s fiscal year. In the event that the 8 board fails to timely adopt the annual budget a second time, it 9 shall be deemed a minor violation and the prior year’s budget 10 shall continue in effect until a new budget is adopted. A 11 multicondominium association shall adopt a separate budget of 12 common expenses for each condominium the association operates 13 and shall adopt a separate budget of common expenses for the 14 association. In addition, if the association maintains limited 15 common elements with the cost to be shared only by those 16 entitled to use the limited common elements as provided for in 17 s. 718.113(1), the budget or a schedule attached to it must show 18 the amount budgeted for this maintenance. If, after turnover of 19 control of the association to the unit owners, any of the 20 expenses listed in s. 718.504(21) are not applicable, they need 21 not be listed. 22 2.a. In addition to annual operating expenses, the budget 23 must include reserve accounts for capital expenditures and 24 deferred maintenance. These accounts must include, but are not 25 limited to, roof replacement, building painting, and pavement 26 resurfacing, regardless of the amount of deferred maintenance 27 expense or replacement cost, and any other item that has a 28 deferred maintenance expense or replacement cost that exceeds 29 $10,000. The amount to be reserved must be computed using a 30 formula based upon estimated remaining useful life and estimated 31 replacement cost or deferred maintenance expense of each reserve 32 item. The association may adjust replacement reserve assessments 33 annually to take into account any changes in estimates or 34 extension of the useful life of a reserve item caused by 35 deferred maintenance. This subsection does not apply to an 36 adopted budget in which the members of an association have 37 determined, by a majority vote at a duly called meeting of the 38 association, to provide no reserves or less reserves than 39 required by this subsection. 40 b. Before turnover of control of an association by a 41 developer to unit owners other than a developer pursuant to s. 42 718.301, the developer may vote the voting interests allocated 43 to its units to waive the reserves or reduce the funding of 44 reserves through the period expiring at the end of the second 45 fiscal year after the fiscal year in which the certificate of a 46 surveyor and mapper is recorded pursuant to s. 718.104(4)(e) or 47 an instrument that transfers title to a unit in the condominium 48 which is not accompanied by a recorded assignment of developer 49 rights in favor of the grantee of such unit is recorded, 50 whichever occurs first, after which time reserves may be waived 51 or reduced only upon the vote of a majority of all nondeveloper 52 voting interests voting in person or by limited proxy at a duly 53 called meeting of the association. If a meeting of the unit 54 owners has been called to determine whether to waive or reduce 55 the funding of reserves and no such result is achieved or a 56 quorum is not attained, the reserves included in the budget 57 shall go into effect. After the turnover, the developer may vote 58 its voting interest to waive or reduce the funding of reserves. 59 3. Reserve funds and any interest accruing thereon shall 60 remain in the reserve account or accounts, and may be used only 61 for authorized reserve expenditures unless their use for other 62 purposes is approved in advance by a majority vote at a duly 63 called meeting of the association. Before turnover of control of 64 an association by a developer to unit owners other than the 65 developer pursuant to s. 718.301, the developer-controlled 66 association may not vote to use reserves for purposes other than 67 those for which they were intended without the approval of a 68 majority of all nondeveloper voting interests, voting in person 69 or by limited proxy at a duly called meeting of the association. 70 4. The only voting interests that are eligible to vote on 71 questions that involve waiving or reducing the funding of 72 reserves, or using existing reserve funds for purposes other 73 than purposes for which the reserves were intended, are the 74 voting interests of the units subject to assessment to fund the 75 reserves in question. Proxy questions relating to waiving or 76 reducing the funding of reserves or using existing reserve funds 77 for purposes other than purposes for which the reserves were 78 intended must contain the following statement in capitalized, 79 bold letters in a font size larger than any other used on the 80 face of the proxy ballot: WAIVING OF RESERVES, IN WHOLE OR IN 81 PART, OR ALLOWING ALTERNATIVE USES OF EXISTING RESERVES MAY 82 RESULT IN UNIT OWNER LIABILITY FOR PAYMENT OF UNANTICIPATED 83 SPECIAL ASSESSMENTS REGARDING THOSE ITEMS. 84 Section 23. Paragraph (m) of subsection (1) of section 85 718.501, Florida Statutes, is amended to read: 86 718.501 Authority, responsibility, and duties of Division 87 of Florida Condominiums, Timeshares, and Mobile Homes.— 88 (1) The division may enforce and ensure compliance with the 89 provisions of this chapter and rules relating to the 90 development, construction, sale, lease, ownership, operation, 91 and management of residential condominium units. In performing 92 its duties, the division has complete jurisdiction to 93 investigate complaints and enforce compliance with respect to 94 associations that are still under developer control or the 95 control of a bulk assignee or bulk buyer pursuant to part VII of 96 this chapter and complaints against developers, bulk assignees, 97 or bulk buyers involving improper turnover or failure to 98 turnover, pursuant to s. 718.301. However, after turnover has 99 occurred, the division has jurisdiction to investigate 100 complaints related only to financial issues, elections, and unit 101 owner access to association records pursuant to s. 718.111(12). 102 (m) If a complaint is made, the division must conduct its 103 inquiry with due regard for the interests of the affected 104 parties. Within 30 days after receipt of a complaint, the 105 division shall acknowledge the complaint in writing and notify 106 the complainant whether the complaint is within the jurisdiction 107 of the division and whether additional information is needed by 108 the division from the complainant. The division shall conduct 109 its investigation and, within 90 days after receipt of the 110 original complaint or of timely requested additional 111 information, take action upon the complaint. However, the 112 failure to complete the investigation within 90 days does not 113 prevent the division from continuing the investigation, 114 accepting or considering evidence obtained or received after 90 115 days, or taking administrative action if reasonable cause exists 116 to believe that a violation of this chapter or a rule has 117 occurred. If an investigation is not completed within the time 118 limits established in this paragraph, the division shall, on a 119 monthly basis, notify the complainant in writing of the status 120 of the investigation. When reporting its action to the 121 complainant, the division shall inform the complainant of any 122 right to a hearing pursuant to ss. 120.569 and 120.57. The 123 division may adopt rules regarding the submission of a complaint 124 against an association. 125 Section 24. Section 718.5014, Florida Statutes, is amended 126 to read: 127 718.5014 Ombudsman location.—The ombudsman shall maintain 128 his or her principal office at ain Leon County on the premises129of the division or, if suitable space cannot be provided there,130at anotherplace convenient to the offices of the division which 131 will enable the ombudsman to expeditiously carry out the duties 132 and functions of his or her office. The ombudsman may establish 133 branch offices elsewhere in the state upon the concurrence of 134 the Governor. 135 Section 25. Paragraph (j) of subsection (1) of section 136 719.106, Florida Statutes, is amended to read: 137 719.106 Bylaws; cooperative ownership.— 138 (1) MANDATORY PROVISIONS.—The bylaws or other cooperative 139 documents shall provide for the following, and if they do not, 140 they shall be deemed to include the following: 141 (j) Annual budget.— 142 1. The proposed annual budget of common expenses shall be 143 detailed and shall show the amounts budgeted by accounts and 144 expense classifications, including, if applicable, but not 145 limited to, those expenses listed in s. 719.504(20). The board 146 of administration shall adopt the annual budget at least 14 days 147 prior to the start of the association’s fiscal year. In the 148 event that the board fails to timely adopt the annual budget a 149 second time, it shall be deemed a minor violation and the prior 150 year’s budget shall continue in effect until a new budget is 151 adopted. 152 2. In addition to annual operating expenses, the budget 153 shall include reserve accounts for capital expenditures and 154 deferred maintenance. These accounts shall include, but not be 155 limited to, roof replacement, building painting, and pavement 156 resurfacing, regardless of the amount of deferred maintenance 157 expense or replacement cost, and for any other items for which 158 the deferred maintenance expense or replacement cost exceeds 159 $10,000. The amount to be reserved shall be computed by means of 160 a formula which is based upon estimated remaining useful life 161 and estimated replacement cost or deferred maintenance expense 162 of each reserve item. The association may adjust replacement 163 reserve assessments annually to take into account any changes in 164 estimates or extension of the useful life of a reserve item 165 caused by deferred maintenance. This paragraph shall not apply 166 to any budget in which the members of an association have, at a 167 duly called meeting of the association, determined for a fiscal 168 year to provide no reserves or reserves less adequate than 169 required by this subsection. However, prior to turnover of 170 control of an association by a developer to unit owners other 171 than a developer pursuant to s. 719.301, the developer may vote 172 to waive the reserves or reduce the funding of reserves for the 173 first 2 years of the operation of the association after which 174 time reserves may only be waived or reduced upon the vote of a 175 majority of all nondeveloper voting interests voting in person 176 or by limited proxy at a duly called meeting of the association. 177 If a meeting of the unit owners has been called to determine to 178 provide no reserves, or reserves less adequate than required, 179 and such result is not attained or a quorum is not attained, the 180 reserves as included in the budget shall go into effect. 181 3. Reserve funds and any interest accruing thereon shall 182 remain in the reserve account or accounts, and shall be used 183 only for authorized reserve expenditures unless their use for 184 other purposes is approved in advance by a vote of the majority 185 of the voting interests, voting in person or by limited proxy at 186 a duly called meeting of the association. Prior to turnover of 187 control of an association by a developer to unit owners other 188 than the developer under s. 719.301, the developer may not vote 189 to use reserves for purposes other than that for which they were 190 intended without the approval of a majority of all nondeveloper 191 voting interests, voting in person or by limited proxy at a duly 192 called meeting of the association. 193 194 ================= T I T L E A M E N D M E N T ================ 195 And the title is amended as follows: 196 Delete lines 98 - 105 197 and insert: 198 boards to adopt annual budgets within a specified 199 timeframe; specifying that the failure to adopt a 200 timely budget a second time is a minor violation and 201 that the previous year’s budget continues in effect 202 until a new budget is adopted; amending s. 718.501, 203 F.S.; authorizing the Division of Florida 204 Condominiums, Timeshares, and Mobile Homes to adopt 205 rules regarding the submission of complaints against a 206 condominium association; amending s. 718.5014, F.S.; 207 revising the location requirements for the principal 208 office of the condominium ombudsman; amending s. 209 719.106, F.S.; requiring boards of administration to 210 adopt annual budgets within a specified timeframe; 211 specifying that the failure to adopt a timely budget a 212 second time is a minor violation and that the previous 213 year’s budget continues in effect until a new budget 214 is adopted; amending ss.