Florida Senate - 2018                                    SB 1238
       By Senator Garcia
       36-00343A-18                                          20181238__
    1                        A bill to be entitled                      
    2         An act relating to homeowners’ associations; amending
    3         s. 720.303, F.S.; prohibiting an association from
    4         hiring an attorney who represents the management
    5         company of the association; requiring the association
    6         to maintain bids for materials, equipment, or services
    7         as part of the official records; providing that a
    8         renter of property in a community operated by an
    9         association has a right to inspect and copy the
   10         association’s bylaws and rules; providing requirements
   11         relating to the posting of specified documents on an
   12         association’s website; requiring an association to
   13         provide members with a copy of the most recent annual
   14         financial report or a written notice detailing how to
   15         obtain such report; prohibiting an association and its
   16         officers, directors, employees, and agents from using
   17         a debit card issued in the name of the association, or
   18         billed directly to the association, for the payment of
   19         any association expense; providing that the use of
   20         such debit card for any expense that is not a lawful
   21         obligation of the association may be prosecuted as
   22         credit card fraud; deleting a provision requiring the
   23         board to certify written ballots or agreements to
   24         recall a director or directors; requiring certain
   25         directors to turn over all records and property of the
   26         association in his or her possession within a certain
   27         timeframe; requiring a director to turn all records
   28         and property of the association over to the board
   29         within 10 business days if a recall is deemed
   30         effective due to the failure to duly notice and hold a
   31         board meeting within a specified timeframe; conforming
   32         provisions to changes made by the act; amending s.
   33         720.3033, F.S.; prohibiting an officer, director, or
   34         manager from soliciting, offering to accept, or
   35         accepting a kickback for which consideration has not
   36         been provided; providing criminal penalties; requiring
   37         that an officer or director charged with certain
   38         crimes be removed from office; providing requirements
   39         for filling the vacancy left by such removal;
   40         prohibiting such officer or director from being
   41         appointed or elected to a position with any
   42         association or having access to official association
   43         records while a criminal charge is pending; providing
   44         an exception; requiring an officer or director to be
   45         reinstated for the remainder of his or her term if the
   46         charges are resolved without a finding of guilt;
   47         amending s. 720.305, F.S.; providing requirements
   48         relating to the suspension of voting rights of unit
   49         owners and members; amending s. 720.306, F.S.;
   50         providing board member term limits; conforming a
   51         cross-reference; amending s. 720.3085, F.S.;
   52         prohibiting specified parties from purchasing a unit
   53         at a foreclosure sale resulting from an association’s
   54         foreclosure of association lien for unpaid assessments
   55         or from taking a title by deed in lieu of foreclosure;
   56         amending s. 720.309, F.S.; prohibiting an association
   57         from employing or contracting with service providers
   58         owned or operated by specified persons; prohibiting
   59         certain parties from purchasing a parcel at a
   60         foreclosure sale resulting from the association’s
   61         foreclosure of association lien for unpaid assessments
   62         or from taking a deed in lieu of a foreclosure;
   63         authorizing a contract with a specific party to be
   64         canceled by a majority vote of the parcel owners under
   65         certain circumstances; creating s. 720.3095, F.S.;
   66         providing requirements and procedures relating to
   67         conflicts of interest; defining the term “relative”;
   68         amending s. 720.311, F.S.; conforming a cross
   69         reference; providing an effective date.
   71  Be It Enacted by the Legislature of the State of Florida:
   73         Section 1. Present subsections (9) through (12) of section
   74  720.303, Florida Statutes, are redesignated as subsections (10)
   75  through (13), respectively, a new subsection (9) is added to
   76  that section, and subsections (1), (4), (5), and (7) and
   77  paragraphs (b), (c), and (d), and present paragraphs (f), (i),
   78  and (l) of present subsection (10), are amended, to read:
   79         720.303 Association powers and duties; meetings of board;
   80  official records; budgets; financial reporting; association
   81  funds; recalls.—
   82         (1) POWERS AND DUTIES.—An association that which operates a
   83  community as defined in s. 720.301, must be operated by an
   84  association that is a Florida corporation. After October 1,
   85  1995, the association must be incorporated and the initial
   86  governing documents must be recorded in the official records of
   87  the county in which the community is located. An association may
   88  operate more than one community. The officers and directors of
   89  an association have a fiduciary relationship to the members who
   90  are served by the association. The powers and duties of an
   91  association include those set forth in this chapter and, except
   92  as expressly limited or restricted in this chapter, those set
   93  forth in the governing documents. After control of the
   94  association is obtained by members other than the developer, the
   95  association may institute, maintain, settle, or appeal actions
   96  or hearings in its name on behalf of all members concerning
   97  matters of common interest to the members, including, but not
   98  limited to, the common areas; roof or structural components of a
   99  building, or other improvements for which the association is
  100  responsible; mechanical, electrical, or plumbing elements
  101  serving an improvement or building for which the association is
  102  responsible; representations of the developer pertaining to any
  103  existing or proposed commonly used facility; and protesting ad
  104  valorem taxes on commonly used facilities. The association may
  105  defend actions in eminent domain or bring inverse condemnation
  106  actions. Before commencing litigation against any party in the
  107  name of the association involving amounts in controversy in
  108  excess of $100,000, the association must obtain the affirmative
  109  approval of a majority of the voting interests at a meeting of
  110  the membership at which a quorum has been attained. An
  111  association may not hire an attorney who represents the
  112  management company of the association. This subsection does not
  113  limit any statutory or common-law right of any individual member
  114  or class of members to bring any action without participation by
  115  the association. A member does not have authority to act for the
  116  association by virtue of being a member. An association may have
  117  more than one class of members and may issue membership
  118  certificates. An association of 15 or fewer parcel owners may
  119  enforce only the requirements of those deed restrictions
  120  established prior to the purchase of each parcel upon an
  121  affected parcel owner or owners.
  122         (4) OFFICIAL RECORDS.—The association shall maintain each
  123  of the following items, when applicable, which constitute the
  124  official records of the association:
  125         (a) Copies of any plans, specifications, permits, and
  126  warranties related to improvements constructed on the common
  127  areas or other property that the association is obligated to
  128  maintain, repair, or replace.
  129         (b) A copy of the bylaws of the association and of each
  130  amendment to the bylaws.
  131         (c) A copy of the articles of incorporation of the
  132  association and of each amendment thereto.
  133         (d) A copy of the declaration of covenants and a copy of
  134  each amendment thereto.
  135         (e) A copy of the current rules of the homeowners’
  136  association.
  137         (f) The minutes of all meetings of the board of directors
  138  and of the members, which minutes must be retained for at least
  139  7 years.
  140         (g) A current roster of all members and their mailing
  141  addresses and parcel identifications. The association shall also
  142  maintain the e-mail electronic mailing addresses and the numbers
  143  designated by members for receiving notice sent by electronic
  144  transmission of those members consenting to receive notice by
  145  electronic transmission. The e-mail electronic mailing addresses
  146  and numbers provided by parcel unit owners to receive notice by
  147  electronic transmission shall be removed from association
  148  records when consent to receive notice by electronic
  149  transmission is revoked. However, the association is not liable
  150  for an erroneous disclosure of the e-mail electronic mail
  151  address or the number for receiving electronic transmission of
  152  notices.
  153         (h) All of the association’s insurance policies or a copy
  154  thereof, which policies must be retained for at least 7 years.
  155         (i) A current copy of all contracts to which the
  156  association is a party, including, without limitation, any
  157  management agreement, lease, or other contract under which the
  158  association has any obligation or responsibility. Bids received
  159  by the association for work to be performed must also be
  160  considered official records and must be kept for a period of 1
  161  year.
  162         (j) The financial and accounting records of the
  163  association, kept according to good accounting practices. All
  164  financial and accounting records must be maintained for a period
  165  of at least 7 years. The financial and accounting records must
  166  include:
  167         1. Accurate, itemized, and detailed records of all receipts
  168  and expenditures.
  169         2. A current account and a periodic statement of the
  170  account for each member, designating the name and current
  171  address of each member who is obligated to pay assessments, the
  172  due date and amount of each assessment or other charge against
  173  the member, the date and amount of each payment on the account,
  174  and the balance due.
  175         3. All tax returns, financial statements, and financial
  176  reports of the association.
  177         4. Any other records that identify, measure, record, or
  178  communicate financial information.
  179         (k) A copy of the disclosure summary described in s.
  180  720.401(1).
  181         (l) Bids for materials, equipment, or services.
  182         (m)(l) All other written records of the association not
  183  specifically included in the foregoing which are related to the
  184  operation of the association.
  185         (5) INSPECTION AND COPYING OF RECORDS.—The official records
  186  shall be maintained within the state for at least 7 years and
  187  shall be made available to a parcel owner for inspection or
  188  photocopying within 45 miles of the community or within the
  189  county in which the association is located within 10 business
  190  days after receipt by the board or its designee of a written
  191  request. This subsection may be complied with by having a copy
  192  of the official records available for inspection or copying in
  193  the community or, at the option of the association, by making
  194  the records available to a parcel owner electronically via the
  195  Internet or by allowing the records to be viewed in electronic
  196  format on a computer screen and printed upon request. If the
  197  association has a photocopy machine available where the records
  198  are maintained, it must provide parcel owners with copies on
  199  request during the inspection if the entire request is limited
  200  to no more than 25 pages. An association shall allow a member or
  201  his or her authorized representative to use a portable device,
  202  including a smartphone, tablet, portable scanner, or any other
  203  technology capable of scanning or taking photographs, to make an
  204  electronic copy of the official records in lieu of the
  205  association’s providing the member or his or her authorized
  206  representative with a copy of such records. The association may
  207  not charge a fee to a member or his or her authorized
  208  representative for the use of a portable device.
  209         (a) The failure of an association to provide access to the
  210  records within 10 business days after receipt of a written
  211  request submitted by certified mail, return receipt requested,
  212  creates a rebuttable presumption that the association willfully
  213  failed to comply with this subsection.
  214         (b) A member who is denied access to official records is
  215  entitled to the actual damages or minimum damages for the
  216  association’s willful failure to comply with this subsection.
  217  The minimum damages are to be $50 per calendar day up to 10
  218  days, the calculation to begin on the 11th business day after
  219  receipt of the written request.
  220         (c) The association may adopt reasonable written rules
  221  governing the frequency, time, location, notice, records to be
  222  inspected, and manner of inspections, but may not require a
  223  parcel owner to demonstrate any proper purpose for the
  224  inspection, state any reason for the inspection, or limit a
  225  parcel owner’s right to inspect records to less than one 8-hour
  226  business day per month. The association may impose fees to cover
  227  the costs of providing copies of the official records, including
  228  the costs of copying and the costs required for personnel to
  229  retrieve and copy the records if the time spent retrieving and
  230  copying the records exceeds one-half hour and if the personnel
  231  costs do not exceed $20 per hour. Personnel costs may not be
  232  charged for records requests that result in the copying of 25 or
  233  fewer pages. The association may charge up to 25 cents per page
  234  for copies made on the association’s photocopier. If the
  235  association does not have a photocopy machine available where
  236  the records are kept, or if the records requested to be copied
  237  exceed 25 pages in length, the association may have copies made
  238  by an outside duplicating service and may charge the actual cost
  239  of copying, as supported by the vendor invoice. The association
  240  shall maintain an adequate number of copies of the recorded
  241  governing documents, to ensure their availability to members and
  242  prospective members. Notwithstanding this paragraph, the
  243  following records are not accessible to members or parcel
  244  owners:
  245         1. Any record protected by the lawyer-client privilege as
  246  described in s. 90.502 and any record protected by the work
  247  product privilege, including, but not limited to, a record
  248  prepared by an association attorney or prepared at the
  249  attorney’s express direction which reflects a mental impression,
  250  conclusion, litigation strategy, or legal theory of the attorney
  251  or the association and which was prepared exclusively for civil
  252  or criminal litigation or for adversarial administrative
  253  proceedings or which was prepared in anticipation of such
  254  litigation or proceedings until the conclusion of the litigation
  255  or proceedings.
  256         2. Information obtained by an association in connection
  257  with the approval of the lease, sale, or other transfer of a
  258  parcel.
  259         3. Personnel records of association or management company
  260  employees, including, but not limited to, disciplinary, payroll,
  261  health, and insurance records. For purposes of this
  262  subparagraph, the term “personnel records” does not include
  263  written employment agreements with an association or management
  264  company employee or budgetary or financial records that indicate
  265  the compensation paid to an association or management company
  266  employee.
  267         4. Medical records of parcel owners or community residents.
  268         5. Social security numbers, driver license numbers, credit
  269  card numbers, e-mail electronic mailing addresses, telephone
  270  numbers, facsimile numbers, emergency contact information, any
  271  addresses for a parcel owner other than as provided for
  272  association notice requirements, and other personal identifying
  273  information of any person, excluding the person’s name, parcel
  274  designation, mailing address, and property address.
  275  Notwithstanding the restrictions in this subparagraph, an
  276  association may print and distribute to parcel owners a
  277  directory containing the name, parcel address, and all telephone
  278  numbers of each parcel owner. However, an owner may exclude his
  279  or her telephone numbers from the directory by so requesting in
  280  writing to the association. An owner may consent in writing to
  281  the disclosure of other contact information described in this
  282  subparagraph. The association is not liable for the disclosure
  283  of information that is protected under this subparagraph if the
  284  information is included in an official record of the association
  285  and is voluntarily provided by an owner and not requested by the
  286  association.
  287         6. Any electronic security measure that is used by the
  288  association to safeguard data, including passwords.
  289         7. The software and operating system used by the
  290  association which allows the manipulation of data, even if the
  291  owner owns a copy of the same software used by the association.
  292  The data is part of the official records of the association.
  293         (d) The association or its authorized agent is not required
  294  to provide a prospective purchaser or lienholder with
  295  information about the residential subdivision or the association
  296  other than information or documents required by this chapter to
  297  be made available or disclosed. The association or its
  298  authorized agent may charge a reasonable fee to the prospective
  299  purchaser or lienholder or the current parcel owner or member
  300  for providing good faith responses to requests for information
  301  by or on behalf of a prospective purchaser or lienholder, other
  302  than that required by law, if the fee does not exceed $150 plus
  303  the reasonable cost of photocopying and any attorney fees
  304  incurred by the association in connection with the response.
  305         (e) A renter of property in a community operated by the
  306  association has a right to inspect and copy the association’s
  307  bylaws and rules.
  308         (f)1. By July 1, 2019, an association with 150 or more
  309  parcels shall post digital copies of the documents specified in
  310  subparagraph 2. on its website.
  311         a. The association’s website must be:
  312         (I) An independent website or web portal wholly owned and
  313  operated by the association; or
  314         (II) A website or web portal operated by a third-party
  315  provider from whom the association owns, leases, rents, or
  316  otherwise obtains the right to operate a web page, subpage, web
  317  portal, or collection of subpages or web portals dedicated to
  318  the association’s activities and on which required notices,
  319  records, and documents may be posted by the association.
  320         b. The association’s website must be accessible through the
  321  Internet and must contain a subpage, web portal, or other
  322  protected electronic location that is inaccessible to the
  323  general public and accessible only to parcel owners and
  324  employees of the association.
  325         c. Upon a parcel owner’s written request, the association
  326  must provide the parcel owner with a username and password and
  327  access to the protected sections of the association’s website
  328  which contain any notices, records, or documents that must be
  329  electronically provided.
  330         2. Current copies of the following documents must be posted
  331  in digital format on the association’s website:
  332         a. The recorded declaration of covenants and each amendment
  333  to each declaration.
  334         b. The recorded bylaws of the association and each
  335  amendment to the bylaws.
  336         c. The articles of incorporation of the association, or
  337  other documents creating the association, and each amendment
  338  thereto. The copy posted pursuant to this sub-subparagraph must
  339  be a copy of the articles of incorporation filed with the
  340  Department of State.
  341         d. The rules of the association.
  342         e. Any management agreement, lease, or other contract to
  343  which the association is a party or under which the association
  344  or the parcel owners have an obligation or responsibility.
  345  Summaries of bids for materials, equipment, or services must be
  346  maintained on the website for 1 year.
  347         f. The annual budget required by paragraph (6)(a) and any
  348  proposed budget to be considered at the annual meeting.
  349         g. The financial report required by subsection (7) and any
  350  proposed financial report to be considered at a meeting.
  351         h. The written certification or educational certificate of
  352  each director required by s. 720.3033(1)(a).
  353         i. All contracts or transactions between the association
  354  and any director, officer, corporation, firm, or association
  355  that is not an affiliated homeowners’ association or any other
  356  entity in which an association director is also a director or
  357  officer and financially interested.
  358         j. Any contract or document regarding a conflict of
  359  interest or possible conflict of interest as provided in ss.
  360  468.436(2) and 720.3033(2).
  361         k. The notice of any member meeting and the agenda for the
  362  meeting, as required by subparagraph (2)(c)1., no later than 7
  363  days before the meeting. The notice must be posted in plain view
  364  on the front page of the website, or on a separate subpage of
  365  the website labeled “Notices” which is conspicuously visible and
  366  linked from the front page. The association must also post on
  367  its website any document to be considered and voted on by the
  368  owners during the meeting or any document listed on the agenda
  369  at least 7 days before the meeting at which the document or the
  370  information in the document will be considered.
  371         l. Notice of any board meeting, the agenda, and any other
  372  document required for the meeting as required by paragraph
  373  (2)(c), which must be posted no later than the date required for
  374  notice pursuant to paragraph (2)(c).
  375         3. The association shall ensure that the information and
  376  records described in this subsection, which are not permitted to
  377  be accessible to parcel owners, are not posted on the
  378  association’s website. If protected information or information
  379  restricted from being accessible to parcel owners is included in
  380  documents that are required to be posted on the association’s
  381  website, the association must ensure the information is redacted
  382  before posting the documents online.
  383         (7) FINANCIAL REPORTING.—Within 90 days after the end of
  384  the fiscal year, or annually on the date provided in the bylaws,
  385  the association shall prepare and complete, or contract with a
  386  third party for the preparation and completion of, a financial
  387  report for the preceding fiscal year. Within 21 days after the
  388  final financial report is completed by the association or
  389  received from the third party, but not later than 120 days after
  390  the end of the fiscal year or other date as provided in the
  391  bylaws, the association shall, within the time limits set forth
  392  in subsection (5), provide each member with a copy of the most
  393  recent annual financial report or a written notice that a copy
  394  of the most recent financial report will be mailed or hand
  395  delivered to the member without charge and within 5 business
  396  days after receipt of a written request from the member is
  397  available upon request at no charge to the member. Financial
  398  reports shall be prepared as follows:
  399         (a) An association that meets the criteria of this
  400  paragraph shall prepare or cause to be prepared a complete set
  401  of financial statements in accordance with generally accepted
  402  accounting principles as adopted by the Board of Accountancy.
  403  The financial statements shall be based upon the association’s
  404  total annual revenues, as follows:
  405         1. An association with total annual revenues of $150,000 or
  406  more, but less than $300,000, shall prepare compiled financial
  407  statements.
  408         2. An association with total annual revenues of at least
  409  $300,000, but less than $500,000, shall prepare reviewed
  410  financial statements.
  411         3. An association with total annual revenues of $500,000 or
  412  more shall prepare audited financial statements.
  413         (b)1. An association with total annual revenues of less
  414  than $150,000 shall prepare a report of cash receipts and
  415  expenditures.
  416         2. A report of cash receipts and disbursement must disclose
  417  the amount of receipts by accounts and receipt classifications
  418  and the amount of expenses by accounts and expense
  419  classifications, including, but not limited to, the following,
  420  as applicable: costs for security, professional, and management
  421  fees and expenses; taxes; costs for recreation facilities;
  422  expenses for refuse collection and utility services; expenses
  423  for lawn care; costs for building maintenance and repair;
  424  insurance costs; administration and salary expenses; and
  425  reserves if maintained by the association.
  426         (c) If 20 percent of the parcel owners petition the board
  427  for a level of financial reporting higher than that required by
  428  this section, the association shall duly notice and hold a
  429  meeting of members within 30 days of receipt of the petition for
  430  the purpose of voting on raising the level of reporting for that
  431  fiscal year. Upon approval of a majority of the total voting
  432  interests of the parcel owners, the association shall prepare or
  433  cause to be prepared, shall amend the budget or adopt a special
  434  assessment to pay for the financial report regardless of any
  435  provision to the contrary in the governing documents, and shall
  436  provide within 90 days of the meeting or the end of the fiscal
  437  year, whichever occurs later:
  438         1. Compiled, reviewed, or audited financial statements, if
  439  the association is otherwise required to prepare a report of
  440  cash receipts and expenditures;
  441         2. Reviewed or audited financial statements, if the
  442  association is otherwise required to prepare compiled financial
  443  statements; or
  444         3. Audited financial statements if the association is
  445  otherwise required to prepare reviewed financial statements.
  446         (d) If approved by a majority of the voting interests
  447  present at a properly called meeting of the association, an
  448  association may prepare or cause to be prepared:
  449         1. A report of cash receipts and expenditures in lieu of a
  450  compiled, reviewed, or audited financial statement;
  451         2. A report of cash receipts and expenditures or a compiled
  452  financial statement in lieu of a reviewed or audited financial
  453  statement; or
  454         3. A report of cash receipts and expenditures, a compiled
  455  financial statement, or a reviewed financial statement in lieu
  456  of an audited financial statement.
  457         (9) DEBIT CARDS.—
  458         (a) An association and its officers, directors, employees,
  459  and agents may not use a debit card issued in the name of the
  460  association, or billed directly to the association, for the
  461  payment of any association expense.
  462         (b) Use of a debit card issued in the name of the
  463  association, or billed directly to the association, for any
  464  expense that is not a lawful obligation of the association may
  465  be prosecuted as credit card fraud pursuant to s. 817.61.
  466         (11)(10) RECALL OF DIRECTORS.—
  467         (b)1. Board directors may be recalled by an agreement in
  468  writing or by written ballot without a membership meeting. The
  469  agreement in writing or the written ballots, or a copy thereof,
  470  shall be served on the association by certified mail or by
  471  personal service in the manner authorized by chapter 48 and the
  472  Florida Rules of Civil Procedure.
  473         2. The board shall duly notice and hold a meeting of the
  474  board within 5 full business days after receipt of the agreement
  475  in writing or written ballots. At the meeting, the board shall
  476  either certify the written ballots or written agreement to
  477  recall a director or directors of the board, in which case Such
  478  director or directors shall be recalled effective immediately
  479  and shall turn over to the board within 10 5 full business days
  480  after the vote any and all records and property of the
  481  association in their possession, or proceed as described in
  482  paragraph (d).
  483         3. When it is determined by the department pursuant to
  484  binding arbitration proceedings that an initial recall effort
  485  was defective, written recall agreements or written ballots used
  486  in the first recall effort and not found to be defective may be
  487  reused in one subsequent recall effort. However, in no event is
  488  a written agreement or written ballot valid for more than 120
  489  days after it has been signed by the member.
  490         4. Any rescission or revocation of a member’s written
  491  recall ballot or agreement must be in writing and, in order to
  492  be effective, must be delivered to the association before the
  493  association is served with the written recall agreements or
  494  ballots.
  495         5. The agreement in writing or ballot must shall list at
  496  least as many possible replacement directors as there are
  497  directors subject to the recall, when at least a majority of the
  498  board is sought to be recalled; the person executing the recall
  499  instrument may vote for as many replacement candidates as there
  500  are directors subject to the recall.
  501         (c)1. If the declaration, articles of incorporation, or
  502  bylaws specifically provide, the members may also recall and
  503  remove a board director or directors by a vote taken at a
  504  meeting. If so provided in the governing documents, a special
  505  meeting of the members to recall a director or directors of the
  506  board of administration may be called by 10 percent of the
  507  voting interests giving notice of the meeting as required for a
  508  meeting of members, and the notice shall state the purpose of
  509  the meeting. Electronic transmission may not be used as a method
  510  of giving notice of a meeting called in whole or in part for
  511  this purpose.
  512         2. The board shall duly notice and hold a board meeting
  513  within 5 full business days after the adjournment of the member
  514  meeting to recall one or more directors. At the meeting, the
  515  board shall certify the recall, in which case such member or
  516  members shall be recalled effective immediately and shall turn
  517  over to the board within 5 full business days any and all
  518  records and property of the association in their possession, or
  519  shall proceed as set forth in paragraph (d).
  520         (d) If the board determines not to certify the written
  521  agreement or written ballots to recall a director or directors
  522  of the board or does not certify the recall by a vote at a
  523  meeting, the board shall, within 5 full business days after the
  524  meeting, file with the department a petition for binding
  525  arbitration pursuant to the applicable procedures in ss.
  526  718.112(2)(j) and 718.1255 and the rules adopted thereunder. For
  527  the purposes of this section, the members who voted at the
  528  meeting or who executed the agreement in writing shall
  529  constitute one party under the petition for arbitration. If the
  530  arbitrator certifies the recall as to any director or directors
  531  of the board, the recall will be effective upon mailing of the
  532  final order of arbitration to the association. The director or
  533  directors so recalled shall deliver to the board any and all
  534  records of the association in their possession within 5 full
  535  business days after the effective date of the recall.
  536         (e)(f) If the board fails to duly notice and hold a board
  537  meeting within 5 full business days after service of an
  538  agreement in writing or within 5 full business days after the
  539  adjournment of the member recall meeting, the recall shall be
  540  deemed effective and the board directors so recalled shall
  541  immediately turn over to the board within 10 full business days
  542  after the vote all records and property of the association.
  543         (i) The minutes of the board meeting at which the board
  544  decides whether to certify the recall are an official
  545  association record. The minutes must record the date and time of
  546  the meeting, the decision of the board, and the vote count taken
  547  on each board member subject to the recall. In addition, when
  548  the board decides not to certify the recall, as to each vote
  549  rejected, the minutes must identify the parcel number and the
  550  specific reason for each such rejection.
  551         (j)(l) The division may not accept for filing a recall
  552  petition, whether filed pursuant to paragraph (b), paragraph
  553  (c), paragraph (f) (g), or paragraph (i) (k) and regardless of
  554  whether the recall was certified, when there are 60 or fewer
  555  days until the scheduled reelection of the board member sought
  556  to be recalled or when 60 or fewer days have not elapsed since
  557  the election of the board member sought to be recalled.
  558         Section 2. Present subsections (4) and (5) of section
  559  720.3033, Florida Statutes, are redesignated as subsections (5)
  560  and (6), respectively, a new subsection (4) is added to that
  561  section, and subsection (3) of that section is amended, to read:
  562         720.3033 Officers and directors.—
  563         (3) An officer, director, or manager may not solicit, offer
  564  to accept, or accept any good or service of value or kickback
  565  for which consideration has not been provided for his or her
  566  benefit or for the benefit of a member of his or her immediate
  567  family from any person providing or proposing to provide goods
  568  or services to the association. Any such officer, director, or
  569  manager who knowingly so solicits, offers to accept, or accepts
  570  any good or service of value or a kickback is subject a criminal
  571  penalty as provided in subsection (4), if applicable. If the
  572  board finds that an officer or director has violated this
  573  subsection, the board shall immediately remove the officer or
  574  director from office. The vacancy shall be filled according to
  575  law until the end of the director’s term of office. However, an
  576  officer, director, or manager may accept food to be consumed at
  577  a business meeting with a value of less than $25 per individual
  578  or a service or good received in connection with trade fairs or
  579  education programs.
  580         (4) As required by s. 617.0830, an officer, director, or
  581  agent shall discharge his or her duties in good faith, with the
  582  care an ordinarily prudent person in a like position would
  583  exercise under similar circumstances, and in a manner he or she
  584  reasonably believes to be in the interests of the association.
  585  An officer, director, or agent is liable for monetary damages as
  586  provided in s. 617.0834 if such officer, director, or agent
  587  breached or failed to perform his or her duties and the breach
  588  of, or failure to perform, his or her duties constitutes a
  589  violation of criminal law as provided in s. 617.0834;
  590  constitutes a transaction from which the officer or director
  591  derived an improper personal benefit, either directly or
  592  indirectly; or constitutes recklessness or an act or omission
  593  that was in bad faith, with malicious purpose, or in a manner
  594  exhibiting wanton and willful disregard of human rights, safety,
  595  or property. Forgery of a ballot envelope or voting certificate
  596  used in a homeowners’ association election is punishable as
  597  provided in s. 831.01; the theft or embezzlement of funds of a
  598  homeowners’ association is punishable as provided in s. 812.014;
  599  and the destruction of or the refusal to allow inspection or
  600  copying of an official record of a homeowners’ association which
  601  is required to be accessible to parcel owners within the periods
  602  required by general law in furtherance of any crime is
  603  punishable as tampering with physical evidence as provided in s.
  604  918.13 or as obstruction of justice as provided in chapter 843.
  605  An officer or director charged by information or indictment with
  606  a crime referenced in this paragraph must be removed from
  607  office, and the vacancy shall be filled according to law until
  608  the end of the officer’s or director’s period of suspension or
  609  the end of his or her term of office, whichever occurs first. If
  610  a criminal charge is pending against the officer or director, he
  611  or she may not be appointed or elected to a position as an
  612  officer or a director of any association and may not have access
  613  to the official records of any association, except pursuant to a
  614  court order. However, if the charges are resolved without a
  615  finding of guilt, the officer or director must be reinstated for
  616  the remainder of his or her term of office, if any.
  617         Section 3. Subsection (4) of section 720.305, Florida
  618  Statutes, is amended to read:
  619         720.305 Obligations of members; remedies at law or in
  620  equity; levy of fines and suspension of use rights.—
  621         (4) An association may suspend the voting rights of a
  622  parcel owner or member for the nonpayment of any fee, fine, or
  623  other monetary obligation due to the association that is more
  624  than $1,000 and more than 90 days delinquent. Proof of such
  625  obligation must be provided to the parcel owner or member at
  626  least 30 days before such suspension takes effect. A voting
  627  interest or consent right allocated to a parcel owner or member
  628  which has been suspended by the association shall be subtracted
  629  from the total number of voting interests in the association,
  630  which shall be reduced by the number of suspended voting
  631  interests when calculating the total percentage or number of all
  632  voting interests available to take or approve any action, and
  633  the suspended voting interests may shall not be considered for
  634  any purpose, including, but not limited to, the percentage or
  635  number of voting interests necessary to constitute a quorum, the
  636  percentage or number of voting interests required to conduct an
  637  election, or the percentage or number of voting interests
  638  required to approve an action under this chapter or pursuant to
  639  the governing documents. The notice and hearing requirements
  640  under subsection (2) do not apply to a suspension imposed under
  641  this subsection. The suspension ends upon full payment of all
  642  obligations currently due or overdue to the association.
  643         Section 4. Paragraphs (a) and (c) of subsection (9) of
  644  section 720.306, Florida Statutes, are amended to read:
  645         720.306 Meetings of members; voting and election
  646  procedures; amendments.—
  648         (a)1. Elections of directors must be conducted in
  649  accordance with the procedures set forth in the governing
  650  documents of the association. Except as provided in paragraph
  651  (b), all members of the association are eligible to serve on the
  652  board of directors, and a member may nominate himself or herself
  653  as a candidate for the board at a meeting where the election is
  654  to be held; provided, however, that if the election process
  655  allows candidates to be nominated in advance of the meeting, the
  656  association is not required to allow nominations at the meeting.
  657  An election is not required unless more candidates are nominated
  658  than vacancies exist. Except as otherwise provided in the
  659  governing documents, boards of directors must be elected by a
  660  plurality of the votes cast by eligible voters. Any challenge to
  661  the election process must be commenced within 60 days after the
  662  election results are announced.
  663         2. A board member may not serve more than four consecutive
  664  2-year terms or more than eight consecutive 1-year terms, unless
  665  approved by an affirmative vote of two-thirds of the total
  666  voting interests of the association or unless there are not
  667  enough eligible candidates to fill the vacancies on the board at
  668  the time of the vacancy.
  669         (c) Any election dispute between a member and an
  670  association must be submitted to mandatory binding arbitration
  671  with the division. Such proceedings must be conducted in the
  672  manner provided by s. 718.1255 and the procedural rules adopted
  673  by the division. Unless otherwise provided in the bylaws, any
  674  vacancy occurring on the board before the expiration of a term
  675  may be filled by an affirmative vote of the majority of the
  676  remaining directors, even if the remaining directors constitute
  677  less than a quorum, or by the sole remaining director. In the
  678  alternative, a board may hold an election to fill the vacancy,
  679  in which case the election procedures must conform to the
  680  requirements of the governing documents. Unless otherwise
  681  provided in the bylaws, a board member appointed or elected
  682  under this section is appointed for the unexpired term of the
  683  seat being filled. Filling vacancies created by recall is
  684  governed by s. 720.303(11) s. 720.303(10) and rules adopted by
  685  the division.
  686         Section 5. Paragraph (f) of subsection (1) of section
  687  720.3085, Florida Statutes, is amended to read:
  688         720.3085 Payment for assessments; lien claims.—
  689         (1) When authorized by the governing documents, the
  690  association has a lien on each parcel to secure the payment of
  691  assessments and other amounts provided for by this section.
  692  Except as otherwise set forth in this section, the lien is
  693  effective from and shall relate back to the date on which the
  694  original declaration of the community was recorded. However, as
  695  to first mortgages of record, the lien is effective from and
  696  after recording of a claim of lien in the public records of the
  697  county in which the parcel is located. This subsection does not
  698  bestow upon any lien, mortgage, or certified judgment of record
  699  on July 1, 2008, including the lien for unpaid assessments
  700  created in this section, a priority that, by law, the lien,
  701  mortgage, or judgment did not have before July 1, 2008.
  702         (f) The association may purchase the parcel at the
  703  foreclosure sale and hold, lease, mortgage, or convey the
  704  parcel. However, a board member, manager, or management company
  705  may not purchase a parcel at a foreclosure sale resulting from
  706  the association’s foreclosure of its lien for unpaid assessments
  707  or take title by deed in lieu of foreclosure.
  708         Section 6. Section 720.309, Florida Statutes, is amended to
  709  read:
  710         720.309 Agreements entered into by the association;
  711  conflicts of interest.—
  712         (1) Any grant or reservation made by any document, and any
  713  contract that has a term greater than 10 years, that is made by
  714  an association before control of the association is turned over
  715  to the members other than the developer, and that provides for
  716  the operation, maintenance, or management of the association or
  717  common areas, must be fair and reasonable.
  718         (2) If the governing documents provide for the cost of
  719  communications services as defined in s. 202.11, information
  720  services or Internet services obtained pursuant to a bulk
  721  contract shall be deemed an operating expense of the
  722  association. If the governing documents do not provide for such
  723  services, the board may contract for the services, and the cost
  724  shall be deemed an operating expense of the association but must
  725  be allocated on a per-parcel basis rather than a percentage
  726  basis, notwithstanding that the governing documents provide for
  727  other than an equal sharing of operating expenses. Any contract
  728  entered into before July 1, 2011, in which the cost of the
  729  service is not equally divided among all parcel owners may be
  730  changed by a majority of the voting interests present at a
  731  regular or special meeting of the association in order to
  732  allocate the cost equally among all parcels.
  733         (a) Any contract entered into by the board may be canceled
  734  by a majority of the voting interests present at the next
  735  regular or special meeting of the association, whichever occurs
  736  first. Any member may make a motion to cancel such contract, but
  737  if no motion is made or if such motion fails to obtain the
  738  required vote, the contract shall be deemed ratified for the
  739  term expressed therein.
  740         (b) Any contract entered into by the board must provide,
  741  and shall be deemed to provide if not expressly set forth
  742  therein, that a hearing-impaired or legally blind parcel owner
  743  who does not occupy the parcel with a non-hearing-impaired or
  744  sighted person, or a parcel owner who receives supplemental
  745  security income under Title XVI of the Social Security Act or
  746  food assistance as administered by the Department of Children
  747  and Families pursuant to s. 414.31, may discontinue the service
  748  without incurring disconnect fees, penalties, or subsequent
  749  service charges, and may not be required to pay any operating
  750  expenses charge related to such service for those parcels. If
  751  fewer than all parcel owners share the expenses of the
  752  communications services, information services, or Internet
  753  services, the expense must be shared by all participating parcel
  754  owners. The association may use the provisions of s. 720.3085 to
  755  enforce payment by the parcel owners receiving such services.
  756         (c) A resident of any parcel, whether a tenant or parcel
  757  owner, may not be denied access to available franchised,
  758  licensed, or certificated cable or video service providers if
  759  the resident pays the provider directly for services. A resident
  760  or a cable or video service provider may not be required to pay
  761  anything of value in order to obtain or provide such service
  762  except for the charges normally paid for like services by
  763  residents of single-family homes located outside the community
  764  but within the same franchised, licensed, or certificated area,
  765  and except for installation charges agreed to between the
  766  resident and the service provider.
  767         (3) An association may not employ or contract with any
  768  service provider that is owned or operated by a board member or
  769  with any person who has a financial relationship with a board
  770  member or officer, or a relative within the third degree of
  771  consanguinity or affinity of a board member or officer. This
  772  subsection does not apply to a service provider in which a board
  773  member or officer, or a relative within the third degree of
  774  consanguinity or affinity of a board member or officer, owns
  775  less than 1 percent of the equity shares.
  776         (4) A party contracting to provide maintenance or
  777  management services to an association managing a community after
  778  transfer of control of the association, as provided in s.
  779  720.307, may not purchase a parcel at a foreclosure sale
  780  resulting from the association’s foreclosure of association lien
  781  for unpaid assessment or take a deed in lieu of a foreclosure.
  782  If 50 percent or more of the parcels in the community are owned
  783  by a party contracting to provide maintenance or management
  784  services to an association managing a parcel after transfer of
  785  control of the association, as provided in s. 720.307, or by an
  786  officer or board member of such party, the contract with the
  787  party providing maintenance or management services may be
  788  canceled by a majority vote of the parcel owners other than the
  789  contracting party or an officer or board member of such party.
  790         Section 7. Section 720.3095, Florida Statutes, is created
  791  to read:
  792         720.3095 Conflicts of interest.—
  793         (1)Directors and officers of a board of an association and
  794  the relatives of such directors and officers must disclose to
  795  the board any activity that may reasonably be construed to be a
  796  conflict of interest. A rebuttable presumption of a conflict of
  797  interest exists if any of the following occurs without prior
  798  notice, as required in subsection (4):
  799         (a)A director or an officer, or a relative of a director
  800  or an officer, enters into a contract for goods or services with
  801  the association.
  802         (b)A director or an officer, or a relative of a director
  803  or an officer, holds an interest in a corporation, limited
  804  liability corporation, partnership, limited liability
  805  partnership, or other business entity that conducts business
  806  with the association or proposes to enter into a contract or
  807  other transaction with the association.
  808         (2)If a director or an officer, or a relative of a
  809  director or an officer, proposes to engage in an activity that
  810  is a conflict of interest, as described in subsection (1), the
  811  proposed activity must be listed on, and all contracts and
  812  transactional documents related to the proposed activity must be
  813  attached to, the meeting agenda. If the board votes against the
  814  proposed activity, the director or officer, or the relative of
  815  the director or officer, must notify the board in writing of his
  816  or her intention not to pursue the proposed activity or to
  817  withdraw from office. If the board finds that an officer or a
  818  director has violated this subsection, the officer or director
  819  shall be deemed removed from office. The vacancy shall be filled
  820  according to general law.
  821         (3)A director or an officer, or a relative of a director
  822  or an officer, who is a party to, or has an interest in, an
  823  activity that is a possible conflict of interest, as described
  824  in subsection (1), may attend the meeting at which the activity
  825  is considered by the board and is authorized to make a
  826  presentation to the board regarding the activity. After the
  827  presentation, the director or officer, or the relative of the
  828  director or officer, must leave the meeting during the
  829  discussion of, and the vote on, the activity. A director or an
  830  officer who is a party to, or has an interest in, the activity
  831  must recuse himself or herself from the vote.
  832         (4)A contract entered into between a director or an
  833  officer, or a relative of a director or an officer, and the
  834  association which has not been properly disclosed as a conflict
  835  of interest or potential conflict of interest is voidable and
  836  terminates upon the filing of a written notice with the board of
  837  directors terminating the contract and which contains the
  838  consent of at least 20 percent of the voting interests of the
  839  association.
  840         (5)As used in this section, the term “relative” means a
  841  relative within the third degree of consanguinity or affinity.
  842         Section 8. Subsection (1) of section 720.311, Florida
  843  Statutes, is amended to read:
  844         720.311 Dispute resolution.—
  845         (1) The Legislature finds that alternative dispute
  846  resolution has made progress in reducing court dockets and
  847  trials and in offering a more efficient, cost-effective option
  848  to litigation. The filing of any petition for arbitration or the
  849  serving of a demand for presuit mediation as provided for in
  850  this section shall toll the applicable statute of limitations.
  851  Any recall dispute filed with the department pursuant to s.
  852  720.303(11) s. 720.303(10) shall be conducted by the department
  853  in accordance with the provisions of ss. 718.112(2)(j) and
  854  718.1255 and the rules adopted by the division. In addition, the
  855  department shall conduct mandatory binding arbitration of
  856  election disputes between a member and an association pursuant
  857  to s. 718.1255 and rules adopted by the division. Neither
  858  election disputes nor recall disputes are eligible for presuit
  859  mediation; these disputes shall be arbitrated by the department.
  860  At the conclusion of the proceeding, the department shall charge
  861  the parties a fee in an amount adequate to cover all costs and
  862  expenses incurred by the department in conducting the
  863  proceeding. Initially, the petitioner shall remit a filing fee
  864  of at least $200 to the department. The fees paid to the
  865  department shall become a recoverable cost in the arbitration
  866  proceeding, and the prevailing party in an arbitration
  867  proceeding shall recover its reasonable costs and attorney
  868  attorney’s fees in an amount found reasonable by the arbitrator.
  869  The department shall adopt rules to effectuate the purposes of
  870  this section.
  871         Section 9. This act shall take effect July 1, 2018.