Bill to shore up building safety, condo board accountability clears first Senate hurdle

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Florida’s “toothless” laws for handling condo complaints and delinquent recordkeeping could gain some serious bite through legislation now advancing in the Legislature.

Members of the Senate Regulated Industries Committee voted unanimously to advance a 105-page bill (SB 1178) designed to crack down on unscrupulous or neglectful boards, inform unit owners and make it easier to punish wrongdoers.

It’s the latest statewide proposal aimed at boosting condo safety following the deadly June 2021 collapse of the Champlain Towers South condo in Surfside. Lawmakers passed measures in 2022 and last year to shore up deficiencies in building maintenance and the oversight and accountability of boards.

SB 1178 and its similar companion in the House (HB 1021) are the “next necessary step,” said the bill’s sponsor, Fleming Island Republican Sen. Jennifer Bradley.

“It’s one that’s been needed for many years,” she said. “We have grand jury reports, House Select Committee reports going back more than a decade. We had a great panel in this committee that was illuminating in both the scope and depth of some of the concerns that are happening in associations.”

Bradley referred to a Nov. 14 discussion on the efficacy and enforceability of Florida’s condo laws, particularly those concerning condo boards and the management companies some hire to oversee operations and upkeep.

Spencer Hennings, who served as the state’s condominium ombudsman for about three years until April 2023, said Florida’s existing laws rendered his office within the state Department of Business and Professional Regulation (DBPR) a “toothless tiger” when it came to holding malfeasant board members accountable.

The result, he said, is that unit owners “basically have no rights, (and if board members are) stealing money, if they’re concealing records (or) doing something nefarious, good luck asking them to step down (or forcing them to do so by legal action).”

Bradley’s bill, which would overhaul Chapters 718 and 719 of Florida Statutes concerning condo and cooperative associations, is meant to fix that and many other issues.

Among other things, it would:

— Expand jurisdiction of DBPR to enforce state condo and condo association laws and require the Department to refer suspected cases of fraud, theft or embezzlement to law enforcement.

— Enhance access to condo records by requiring all associations with 25 units or more to maintain a website through which owners can access official records. The current threshold is 150 units.

— Create criminal penalties for board members who commit fraudulent voting activity or solicit or accept kickbacks.

— Create criminal penalties for repeated and willful violations related to the inspection of records and for refusing to provide records in order to escape criminal prosecution.

— Establish new safeguards for associations that invest their reserves, a practice Bradley said is already allowed “but for which there are no guardrails.”

— Require condo association boards to meet at least quarterly and provide in meeting notices copies of all contracts under consideration at the meeting in question.

— Create disclosure requirements for condo management firms.

— Require board members to satisfy stricter education requirements. Members are mandated now only to avow and check a box to say they’ve read the association bylaws. The proposed change would compel them to undergo initial and annual education, which Bradley said would enable them to “better fulfill their fiduciary obligations.”

— Allow boards to secure lines of credit to fund state-required milestone repairs or to meet the reserve funding schedule recommended by their structural integrity reserve study.

— Clarifies obligations of an association and owners regarding hurricane protections.

— Revises Florida’s anti-SLAPP (strategic lawsuits against public participation) laws to provide that association funds cannot be used to support defamation and libel actions against owners.

— Correct a “glitch” in the most recently passed condo safety bill (SB 154) to guarantee that unit owners can obtain a copy of a building’s structural integrity reserve study within 45 days of its completion.

Florida law already requires condo associations to allow unit owners to vote electronically; however, they must first request to do so through a written letter. On Monday, Tamarac Democratic Sen. Rosalind Osgood proffered an amendment to enable them to make the request electronically as well.

Bradley accepted, calling it a “good, friendly amendment.”

Representatives for the Chief Executive Officers of Management Companies, Florida Realtors Association and AARP Florida all signaled support for the bill, which Lopez dubbed “Condo 3.0” in a discussion with Florida Politics early this month.

“We recognized that we need to ensure DBPR has sufficient resources and jurisdiction in order to regulate condominiums in Florida. This bill … is going to address so many of the concerns we heard from both the community and a pair of reports (on the matter) from 2007 and 2016,” she said. “Many of those concerns are still relevant today, which is kind of frightening.”

SB 1176, which Democratic Miami Sen. Jason Pizzo is cosponsoring, has two more committee stops before reaching the Senate floor. HB 1021, cosponsored by Miami Republican Rep. Juan Porras, awaits the first of three committees to which House Speaker Paul Renner assigned it.