Senate panel OKs estoppel bill but controversy looms large

The controversy surrounding estoppel letters, how long they are effective, and how much they cost, has not stopped in the week since this Legislature considered the bill.

The Senate Regulated Industries on Tuesday again considered SB 736, sponsored by state Sen. Kelli Stargel. The bill is supported by the Florida Association of Realtors and is opposed by Community Association Managers, among others.

Estoppel letters are legal documents that list information regarding the current owner’s financial obligations to their homeowner’s associations. The bill initially would have capped how much Home Owner Associations could charge for estoppel letters but that was removed last week when the committee amended the bill. The committee ran out of time, though, before it could vote the measure out.

The amended bill trim backs the number of days from 15 to 10 to respond to a written request for an estoppel certificate. It also requires an estoppel letter to be dated as of the date it is delivered and requires that it be effective for 30 days.

Community Association Managers lobbyist Mark Anderson said the costs of the estoppel are currently picked up by either the Realtors or the title company when the estoppel letters are ordered, which must be done before closing.

The bill would allow the estoppel letters to be paid at closing, thereby shifting the costs from the title companies and Realtors to the sellers.

After hearing more than 30 minutes of testimony on the measure — much of which was contradictory — Committee chairman Sen. Rob Bradley said he hasn’t let any bills move through the Senate Regulated Industries Committee that weren’t ready for the Senate Floor.

“This will probably be the exception, because I don’t know if we can hear any more about it,” Bradley said only half jokingly.

The bill’s next stop is the Senate Judiciary Committee, which is headed by Sen. Alex Diaz de la Portilla, who expressed concerns with the measure in the Regulated Industries Committee.

Diaz de la Portilla promised that the bill “won’t be worked out at the Thunderdome but it will be worked out at the firing line.”