Reserve Funding

November 22, 2021

High-Rise Condo Safety Reform Recommendations Appear, But Most Florida Municipalities Awaiting Statewide Changes

by Laura Manning-Hudson

Laura Manning-Hudson

Five months after the tragic collapse of the Champlain Towers South condominium in Surfside, Fla., several major organizations have developed a number of high-rise condo safety reforms and recommendations. However, most Florida counties and municipalities appear to be holding off in expectation of statewide changes to legislation during the next legislative session that starts in January.

The Community Associations Institute, which is the largest organization representing the interests of associations in the world, has issued a report with a number of public policy recommendations aimed at providing solutions for legislators addressing high-rise building safety. In addition, seven of Florida’s top architecture and engineering trade groups created a task force that has recommended re-inspections after 30 years with follow-ups every 10 years, and The Florida Bar has also completed the report and recommendations from its Condominium Law Life Safety Task Force.

CAI’s public policy recommendations cover the areas of reserve studies and funding, building maintenance, and structural integrity. The organization believes its recommendations should be considered for adoption into state law to support the existing statutory framework for the development, governance, and management of community associations. It is planning to release model statutory language in support of its policy recommendations.

In addition, federal mortgage lender Fannie Mae has released new project requirements for condominiums and housing cooperatives that will begin Jan. 1 for loans secured by units in high-rise buildings containing five or more attached units. The requirements place a heavy focus on structural and financial stability, and reinforces the importance of meticulous documentation of all appraisals, meeting minutes, financial statements, engineering reports, inspection reports, and reserve studies.

September 22, 2021

Community Associations Institute Considering Reforms Following Surfside Collapse

by Roberto C. Blanch

Roberto C. Blanch

The Community Associations Institute, the leading organization representing the interests of condominium associations and HOAs, is considering several policy reform recommendations on matters such as building inspections as well as reserve studies and funding in the wake of the devastating tragedy of the Champlain Towers South collapse in Surfside, Fla.

According to a recent post in its Ungated blog at blog.caionline.org, the organization’s Government and Public Affairs Committee convened a special meeting recently to hear the recommendations from three task forces on new public policy reforms as well as best practices and guidance for local, state and federal legislators.

The three task forces focused on building inspections and maintenance; reserve study and funding plans; and insurance and risk management. They have recommended that the committee focus on reforms such as having developers provide a preventive maintenance schedule for all components that are the responsibility of the community association, not just the components included in the reserve study. They also recommended baseline inspections and regular inspections based on specific intervals, the protocols for which can be found in the American Society of Civil Engineers’ Guideline for Structural Condition Assessment of Existing Buildings, and disclosures of the findings to homeowners, residents and local governments.

September 20, 2021

Article Authored by Lindsey Thurswell Lehr and Berenice Mottin-Berger in Today’s Daily Business Review: “Funding Community Association Repairs and Renovations”

by Siegfried Rivera

Siegfried Rivera

An article authored by the firm’s Lindsey Thurswell Lehr and Berenice Mottin-Berger was featured as the guest commentary column in the online edition of today’s Daily Business Review, South Florida’s exclusive business daily and official court newspaper, and will soon appear in the print edition. The article, which is titled “Funding Community Association Repairs and Renovations,” concentrates on how the funding of long-term condominium maintenance, repair and replacement projects has become a major focus at many communities across the country after the horrific tragedy of the collapse in Surfside, Fla. It notes that many association board members who previously might have avoided increasing monthly assessments and implementing large special assessments are now looking to evaluate and address the inevitable deterioration of their buildings. Lindsey and Berenice’s article reads:

. . . Rather than kicking the can down the road in hopes that future boards will address worsening maintenance concerns, association directors are coming to terms with the fact that delayed repairs and maintenance are likely to exacerbate structural problems and increase the eventual costs, in addition obviously to the potential life-safety risks, to be borne by the owners. As never before, association boards and unit owners have become keenly aware of the importance of maintaining adequate financial reserves to fund future construction projects.