Florida Senate - 2023                                     SB 810
       
       
        
       By Senator Gruters
       
       
       
       
       
       22-00452A-23                                           2023810__
    1                        A bill to be entitled                      
    2         An act relating to financing improvements to real
    3         property; amending s. 163.08, F.S.; revising
    4         legislative intent; defining and revising terms;
    5         authorizing a residential or commercial property owner
    6         to apply to a local government for funding to finance
    7         an improvement and to enter into a financing agreement
    8         with the local government; providing that a non-ad
    9         valorem assessment on certain commercial property is
   10         subject to a certain fee; requiring a delinquent
   11         assessment with a nongovernmental lessee to be
   12         enforced in the manner provided by law; specifying
   13         requirements of the financing agreement for government
   14         commercial property; specifying the determinations a
   15         local government must make before entering into a
   16         financing agreement for commercial and residential
   17         properties; authorizing a financing agreement to be
   18         executed for commercial property under certain
   19         circumstances; restricting what improvements may be
   20         covered in certain agreements between local
   21         governments and residential property owners; limiting
   22         the amount of non-ad valorem assessment for certain
   23         residential property; providing an exception relating
   24         to non-ad valorem assessment for residential property
   25         that is supported by an energy audit; specifying
   26         requirements for local government before entering into
   27         a financing agreement; revising notice requirements
   28         regarding an owner’s intent to enter into a financing
   29         agreement; revising the seller’s disclosure statement
   30         for certain properties offered for sale; providing
   31         construction; providing an effective date.
   32          
   33  Be It Enacted by the Legislature of the State of Florida:
   34  
   35         Section 1. Paragraph (b) of subsection (1) and subsections
   36  (2), (4), (8), (9), (10), (12), (13), and (14) of section
   37  163.08, Florida Statutes, are amended, and subsection (17) is
   38  added to that section, to read:
   39         163.08 Supplemental authority for improvements to real
   40  property.—
   41         (1)
   42         (b) The Legislature finds that all energy-consuming
   43  improved properties that are not using energy conservation
   44  strategies contribute to the burden affecting all improved
   45  property resulting from fossil fuel energy production. Improved
   46  property that has been retrofitted with energy-related
   47  qualifying improvements receives the special benefit of
   48  alleviating the property’s burden from energy consumption. All
   49  improved properties not protected from wind damage by wind
   50  resistance qualifying improvements contribute to the burden
   51  affecting all improved property resulting from potential wind
   52  damage. Improved property that has been retrofitted with
   53  resiliency wind resistance qualifying improvements receives the
   54  special benefit of reducing the property’s burden from potential
   55  wind damage. Further, the installation and operation of
   56  qualifying improvements not only benefit the affected properties
   57  for which the improvements are made, but also assist in
   58  fulfilling the goals of the state’s energy and hurricane
   59  mitigation policies. In order to make qualifying improvements
   60  more affordable and assist property owners who wish to undertake
   61  such improvements, the Legislature finds that there is a
   62  compelling state interest in enabling property owners to
   63  voluntarily finance such improvements with local government
   64  assistance.
   65         (2) As used in this section, the term:
   66         (a) “Commercial property” means real property not defined
   67  as residential property which will be or has been improved by a
   68  qualifying improvement, including, but not limited to, the
   69  following:
   70         1.A multifamily residential property composed of five or
   71  more dwelling units;
   72         2.A commercial real property;
   73         3.An industrial building or property;
   74         4.An agricultural property;
   75         5.A nonprofit-owned property;
   76         6.A long-term care facility, including nursing homes and
   77  assisted living facilities; or
   78         7.A government commercial property.
   79         (b)“Government commercial property” means real property
   80  owned by a local government and leased to a nongovernmental
   81  lessee where the usage by the lessee meets the definition of
   82  commercial property.
   83         (c) “Local government” means a county, a municipality, a
   84  dependent special district as defined in s. 189.012, or a
   85  separate legal entity created pursuant to s. 163.01(7).
   86         (d)“Nongovernmental lessee” means a person or an entity
   87  other than a local government which leases government commercial
   88  property.
   89         (e)(b) “Qualifying improvement” includes any:
   90         1. Energy conservation and efficiency improvement, which is
   91  a measure to reduce consumption through conservation or a more
   92  efficient use of electricity, natural gas, propane, or other
   93  forms of energy on the property, including, but not limited to,
   94  air sealing; installation of insulation; installation of energy
   95  efficient heating, cooling, or ventilation systems; building
   96  modifications to increase the use of daylight; replacement of
   97  windows; installation of energy controls or energy recovery
   98  systems; installation of electric vehicle charging equipment;
   99  and installation of efficient lighting equipment; or any other
  100  improvements necessary to achieve a sustainable building rating
  101  or compliance with a national model green building code.
  102         2. Renewable energy improvement, which is the installation
  103  of any system in which the electrical, mechanical, or thermal
  104  energy is produced from a method that uses one or more of the
  105  following fuels or energy sources: hydrogen, solar energy,
  106  geothermal energy, bioenergy, and wind energy.
  107         3. Resiliency Wind resistance improvement, which includes,
  108  but is not limited to:
  109         a. Improving the strength of the roof deck attachment;
  110         b. Creating a secondary water barrier, including sea walls,
  111  to prevent water intrusion;
  112         c. Installing wind-resistant shingles;
  113         d. Installing gable-end bracing;
  114         e. Reinforcing roof-to-wall connections;
  115         f. Installing storm shutters; or
  116         g. Installing opening protections;
  117         h.Creating or improving stormwater, flood, and wastewater
  118  management; or
  119         i.Making any other improvements necessary to achieve a
  120  sustainable building rating or compliance with a national model
  121  resiliency standard.
  122         (f)“Residential property” means a residential real
  123  property of four or fewer dwelling units which will be or has
  124  been improved by a qualifying improvement.
  125         (4) Subject to local government ordinance or resolution, a
  126  residential or commercial property owner may apply to the local
  127  government for funding to finance a qualifying improvement and
  128  enter into a financing agreement with the local government.
  129  Costs incurred by the local government for such purpose may be
  130  collected as a non-ad valorem assessment. A non-ad valorem
  131  assessment must shall be collected pursuant to s. 197.3632 and,
  132  notwithstanding s. 197.3632(8)(a), is shall not be subject to
  133  discount for early payment. However, the notice and adoption
  134  requirements of s. 197.3632(4) do not apply if this section is
  135  used and complied with, and the intent resolution, publication
  136  of notice, and mailed notices to the property appraiser, tax
  137  collector, and Department of Revenue required by s.
  138  197.3632(3)(a) may be provided on or before August 15 in
  139  conjunction with any non-ad valorem assessment authorized by
  140  this section, if the property appraiser, tax collector, and
  141  local government agree. A non-ad valorem assessment on a
  142  commercial property securing financing for a qualifying
  143  improvement, notwithstanding ss. 192.091(2)(b) and
  144  197.3632(8)(c), is subject to a maximum annual fee of 1 percent
  145  of the annual non-ad valorem assessment collected or $5,000,
  146  whichever is less. Notwithstanding this subsection, a delinquent
  147  assessment pursuant to a financing agreement with a
  148  nongovernmental lessee must be enforced in the manner provided
  149  by law for taxes and assessments on property owned by
  150  nongovernmental lessees of government commercial property.
  151         (8) A local government may enter into a financing agreement
  152  to finance or refinance a qualifying improvement only with the
  153  record owner of the affected property. For government commercial
  154  property, the financing agreement must be executed by the
  155  nongovernmental lessee with the written consent of the
  156  governmental lessor. Evidence of such consent must be provided
  157  to the local government. The financing agreement with a
  158  nongovernmental lessee must provide that the nongovernmental
  159  lessee is the only party obligated to pay the assessment. Any
  160  financing agreement entered into pursuant to this section or a
  161  summary memorandum of such agreement must shall be recorded in
  162  the public records of the county within which the property is
  163  located by the sponsoring unit of local government within 5 days
  164  after execution of the agreement. The recorded agreement
  165  provides shall provide constructive notice that the assessment
  166  to be levied on the property constitutes a lien of equal dignity
  167  to county taxes and assessments from the date of recordation.
  168         (9)(a) Before entering into a financing agreement for a
  169  commercial property, the local government shall reasonably
  170  determine that all of the following conditions have been met:
  171         1.that All property taxes and any other assessments levied
  172  on the same bill as property taxes are current. paid and have
  173  not been delinquent for the preceding 3 years or the property
  174  owner’s period of ownership, whichever is less;
  175         2.that There are no involuntary liens greater than
  176  $10,000, including, but not limited to, construction liens on
  177  the property.;
  178         3.that No notices of default or other evidence of
  179  property-based debt delinquency have been recorded and not
  180  released during the preceding 3 years or the property owner’s
  181  period of ownership, whichever is less.;
  182         4.and that The property owner is current on all mortgage
  183  debt on the property.
  184         (b)Before entering into a financing agreement for a
  185  residential property, the local government shall reasonably
  186  determine that all of the following conditions have been met:
  187         1.All property taxes and any other assessments levied on
  188  the same bill as property taxes are paid and have not been
  189  delinquent for the preceding 3 years or the property owner’s
  190  period of ownership, whichever is less.
  191         2.There are no involuntary liens, including, but not
  192  limited to, construction liens on the property.
  193         3.No notices of default or other evidence of property
  194  based debt delinquency have been recorded during the preceding 3
  195  years or the property owner’s period of ownership, whichever is
  196  less.
  197         4.The property owner is current on all mortgage debt on
  198  the property.
  199         (10) To constitute an improvement to the building or
  200  facility, a qualifying improvement must be shall be affixed to a
  201  building or facility that is part of the property and shall
  202  constitute an improvement to the building or facility or a
  203  fixture attached to the building or facility. A financing
  204  agreement may be executed for qualifying improvements in the
  205  construction of a commercial property before a certificate of
  206  occupancy or similar evidence of substantial completion of new
  207  construction or improvement is issued. Progress payments, or
  208  payments made before completion, are allowed for commercial
  209  properties, provided that the property owner subsequently
  210  provides, upon request for a final progress payment
  211  disbursement, written verification to the local government
  212  confirming that the qualifying improvements are completed and
  213  operating as intended. An agreement between a local government
  214  and a qualifying residential property owner may not cover wind
  215  resistant wind-resistance improvements in buildings or
  216  facilities under new construction or construction for which a
  217  certificate of occupancy or similar evidence of substantial
  218  completion of new construction or improvement has not been
  219  issued.
  220         (12)(a) Without the consent of the holders or loan
  221  servicers of any mortgage encumbering or otherwise secured by
  222  the residential property, the total amount of any non-ad valorem
  223  assessment for a property under this section may not exceed 20
  224  percent of the just value of the property as determined by the
  225  county property appraiser.
  226         (b) Notwithstanding paragraph (a), a non-ad valorem
  227  assessment for a qualifying improvement defined in subparagraph
  228  (2)(b)1. or subparagraph (2)(b)2. on a residential property that
  229  is supported by an energy audit is not subject to the limits in
  230  this subsection if the audit demonstrates that the annual energy
  231  savings from the qualified improvement equals or exceeds the
  232  annual repayment amount of the non-ad valorem assessment.
  233         (c)Before entering into a financing agreement with a
  234  commercial property owner, the local government must be in
  235  receipt of the written consent of the current holders or loan
  236  servicers of any mortgage that encumbers or is otherwise secured
  237  by the commercial property or that will otherwise be secured by
  238  the property at the time the financing agreement is executed by
  239  the local government.
  240         (13) At least 30 days before entering into a financing
  241  agreement, the property owner shall provide to the holders or
  242  loan servicers of any existing mortgages that encumber the
  243  property, encumbering or that will otherwise be otherwise
  244  secured by the property at the time the financing agreement is
  245  executed by the local government, a notice of the owner’s intent
  246  to enter into a financing agreement together with the maximum
  247  principal amount to be financed and the maximum annual
  248  assessment necessary to repay that amount. A verified copy or
  249  other proof of such notice must shall be provided to the local
  250  government. A provision in any agreement between a mortgagee or
  251  other lienholder and a property owner, or otherwise now or
  252  hereafter binding upon a property owner, which allows for
  253  acceleration of payment of the mortgage, note, or lien or other
  254  unilateral modification solely as a result of entering into a
  255  financing agreement as provided for in this section is not
  256  enforceable. This subsection does not limit the authority of the
  257  holder or loan servicer to increase the required monthly escrow
  258  by an amount necessary to annually pay the annual qualifying
  259  improvement assessment.
  260         (14) At or before the time a purchaser executes a contract
  261  for the sale and purchase of any property for which a non-ad
  262  valorem assessment has been levied under this section and has an
  263  unpaid balance due, the seller shall give the prospective
  264  purchaser a written disclosure statement in the either of the
  265  following forms form, which must shall be set forth in the
  266  contract or in a separate writing.
  267         (a)For a commercial property:
  268  
  269         QUALIFYING IMPROVEMENTS FOR ENERGY EFFICIENCY,
  270         RENEWABLE ENERGY, OR RESILIENCY WIND RESISTANCE.—The
  271         property being purchased is located within the
  272         jurisdiction of a local government that has placed an
  273         assessment on the property pursuant to s. 163.08,
  274         Florida Statutes. The assessment is for a qualifying
  275         improvement to the property relating to energy
  276         efficiency, renewable energy, or resiliency wind
  277         resistance, and is not based on the value of property.
  278         You are encouraged to contact the county property
  279         appraiser’s office to learn more about this and other
  280         assessments that may be provided by law.
  281  
  282         (b)For a residential property:
  283  
  284         QUALIFYING IMPROVEMENTS FOR ENERGY EFFICIENCY,
  285         RENEWABLE ENERGY, OR RESILIENCY.—The property being
  286         purchased is located within the jurisdiction of a
  287         local government that has placed an assessment on the
  288         property pursuant to s. 163.08, Florida Statutes. The
  289         assessment is for a qualifying improvement to the
  290         property relating to energy efficiency, renewable
  291         energy, or resiliency, and is not based on the value
  292         of property. You are encouraged to contact the county
  293         property appraiser’s office to learn more about this
  294         and other assessments that may be provided by law.
  295  
  296         (17)This section is prospective only and does not affect
  297  or amend any existing non-ad valorem assessment or any existing
  298  interlocal agreement between local governments.
  299         Section 2. This act shall take effect July 1, 2023.