Many Florida condominiums are responding to new inspection and structural-integrity requirements from lenders and insurers by planning for projects to bolster and repair their aging towers. For such major construction projects, competitive bids are literally a must, as they are mandated by Florida law. However, for very small associations as well as for some other types of services and contracts, obtaining competing bids from multiple vendors is not required by state law.
In fact, for small condominium associations with 10 units or less, their owners may opt out of competitive bids with a two-thirds majority vote. For all other condominium associations, bids are required for any agreement for the procurement of goods and services that will exceed 5% of the association’s budget, with exceptions for contracts for the hiring of association employees, and contracts for attorneys, accountants, architects, community association managers, timeshare management firms, engineers, and landscape architects.
Additionally, in cases of an emergency or recovery from storms and other catastrophes, or if the vendor is the only provider of the goods or services being sought in the county where the association is located, competitive bids are not required.
While condominium associations are required to obtain competitive bids for materials, equipment and services that exceed 5% of the total annual budget, including reserves, they are not required to accept the lowest bid, and only two competing bids will suffice to meet the requirement.
There are also requirements under the state’s condominium laws for contracts to be in writing, and those for maintenance or management services must include a litany of specific provisions.
For condominium association boards of directors that are considering contracts for goods and services for their community, they would be well advised to begin by consulting with highly qualified and experienced association legal counsel regarding the bidding process and contract negotiation. Knowledgeable community association attorneys will be able to advise associations on how to solicit and vet bids, and conduct highly effective due diligence prior to any final decisions.
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