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RobertoBlanch_8016-200x300The firm’s latest “Real Estate Counselor” column, which is featured in the Neighbors section of today’s Miami Herald, was authored by shareholder Roberto C. Blanch and titled “Water-leak Suit at Jacksonville Condo Makes Local Headlines, Reveals Telling Lessons.” Roberto’s article focuses on a recent report that aired on both the ABC and NBC affiliates in Jacksonville that included footage of a severe water leak filmed by a condominium tenant. The owner of the unit terminated the tenant’s lease, and he eventually filed a lawsuit against the association after it allegedly declined coverage for extensive water damage including warped floors of costly imported wood, destroyed light fixtures and dangerous mold.  The column reads:

. . . The news report, which can be viewed at tinyurl.com/3un2ktam, illustrates the significant impacts that water leaks can have in condominiums. It is important to note that not all water loss events in condominiums are the result of improper maintenance by the association, as some may result from clogged sinks and toilets, or other owner negligence and causes.

Condominium associations and their property management must periodically inspect and repair their buildings’ common-element pipes and other components. Any leaks that may arise should be quickly and proactively investigated to determine their source and prevent them from causing any further property damage or possible injuries to residents. Miami-Herald-3-13-22-print-page-1-297x300Regardless of a leak’s cause or source,  an association’s management and directors have an obligation to address and potentially eliminate it.

Associations should work with qualified insurance professionals to maintain adequate coverage against the types of damages that are likely to arise from leaks. They should also have a plan of  action in place for the handling of water leaks, including pre-determined arrangements for their immediate remediation and a detailed process for reporting such incidents to the association’s insurance carrier.

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The Florida Legislative Session began on January 11th and is expected to wrap up by the end of this week. We’ve been tracking the 21 bills filed throughout the session that would directly impact community associations throughout Florida.  Below is a summary of the proposed bills that are still making their way through the final leg of this year’s session.

As always, we will inform our readers as to which of the proposed bills become new law, and we will also provide a comprehensive summary of those bills and their impact on community associations. In addition, given the anticipated changes that might come into effect for the state regarding the funding of reserves and new inspection requirements for condominium buildings, we encourage readers to also stay on the lookout for possible changes at local levels.  For example, we recently covered a new Miami-Dade ordinance that requires community associations located in the county to upload certain documents and information to a new publicly accessible database (click here to learn more).

Residential Associations — SB 394 and related HB 547 revise the certification and educational requirements for boards of directors of residential community associations. Newly elected or appointed board members would be required to certify by affidavit that they have read their association’s declaration, articles of incorporation, bylaws and written policies AND will attend a division-approved board certification course. If passed, this law would be effective July 1, 2022.

Florida-legislature-photo-thumb-300x198-300x198Condominium & Homeowners Associations Flags — CS/SB 438 and related HB 465 permit owners in condominium associations and mandatory homeowners associations to display a flag representing the United States Space Force on designated holidays. If passed, this law would come into effect on July 1, 2022.

Display of Flags in Residential Associations — SB 1716 and related HB 1371 authorize owners of condominium associations to display The United States flag, the official flag of the State of Florida, a flag that represents specific special forces, a POW-MIA flag and certain first responder flags, even if the association’s covenants, restrictions, rules or requirements prohibit owners from displaying flags. This act will take effect July 1, 2022, if passed.

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The demands for increased access to condominium financial records and structural reports in Florida after the horrific Champlain Towers tragedy are leading to possible changes at the state and local levels, and they just led to a new local ordinance in Miami-Dade County.

On March 1st, the Miami-Dade Board of County Commissioners unanimously approved an ordinance establishing a searchable database for financial statements and structural reports, among other information and documentation, for residential community associations located in Miami-Dade County. The new ordinance requires community associations in Miami-Dade County, including all condominium, cooperative, and homeowners’ associations, to upload certain documents and information to the county’s database, along with a written registration with the Miami-Dade County Department of Regulatory and Economic Resources, by Feb. 1st of each year, beginning on February 1, 2023.

MCboard-300x169The ordinance provides that the documents uploaded to the database will be publicly accessible on the county’s website, and will also be searchable. Some of the documents to be attached to the annual registration submitted to the county include the following: the name of the community association; the name and contact information for the association’s property manager or other designated agent; a list of all officers and directors of the association, including their contact information; a link to the association’s website, if any; a legible copy of the association’s governing documents; a list containing the association’s planned capital projects from the date of registration through February 1st of the following year; a copy of the association’s current budget and financial statements, including any applicable current or approved special assessments; and all reports issued within the last 10 years on the structural status of the property governed by the association, including recertification reports, if applicable.

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The new condominium safety financing requirements from Fannie Mae and Freddie Mac have drawn a great deal of attention, but the Florida Legislature appears to be poised to go one step further in its response to the horrific Champlain Towers tragedy.

The Florida House and Senate are both moving forward with bills that would add new inspection requirements on condominium buildings. A bill that is now ready to go before the full Senate, SB 1702 would require condominiums that are three stories or taller and located within three miles of the coast to undergo initial inspections 20 years after completion and every seven years thereafter. Buildings in other areas would be required to be inspected after 30 years and every 10 years thereafter.

Flalegislature-300x169The Florida House has taken up its own version of the bill (HB 7069). Its proposal would require initial inspections to occur 25 years after completion, and buildings further inland would have their first inspection at 30 years. Additional inspections would be required every 10 years.

The House and Senate bills also include differences over reserve studies, which are used to determine the level of funds a condominium community needs to maintain in reserve for future renovations and repairs. The differences between the two bills are likely to soon be consolidated into a final bill for bicameral consideration.

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Gary-Mars-2021-2-200x300The firm’s latest “Real Estate Counselor” column in the Miami Herald authored by Gary M. Mars is featured in today’s Neighbors section and titled “Electric Vehicle Chargers At or Near Top of Many Condo Community Wish Lists.”  The article focuses on a state law that was ratified last year to facilitate the addition of shared electric vehicle charging stations as an amenity for the use of owners and guests in Florida condominium communities.  It reads:

. . . For condominium dwellers, the lack of access to electrical charging in congested parking garages with assigned spaces initially proved to be a significant challenge for those with EVs. Wisely, the Florida Legislature passed several new laws in recent years to address the installation of charging stations in condominiums, and the law that went into effect last July to facilitate the deployment of shared community EV charging stations may be the most important yet.

Herald-GMars-2-27-22-print-clip-for-blog-101x300The law clarified that the installation of shared EV charging stations for a community’s owners and guests can be ratified via a simple vote of a condominium association’s board of directors, and it would not require a vote and approval of all the unit owners as is needed for projects involving what are called “material alterations.” The prior new charging-station laws addressed installations to be paid for and used by individual unit owners at their assigned parking spaces.

The problem with that model is that very often there is inadequate electrical infrastructure to install such charging stations without it becoming exorbitantly expensive. EV charging requires heavy-duty electrical cables and equipment that are capable of handling the high-capacity loads necessary to fully charge vehicles in just a few hours, as opposed to 12 hours or more using standard 110-volt outlets. Plus, the electrical consumption needs to be metered and billed to the owner, also requiring additional equipment and expenses.

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The market for homes and condominiums throughout the South Florida region is now thriving, and many of the area’s community associations are seeing more document requests from prospective buyers than ever before. Florida law mandates associations provide certain documents to prospective buyers, and several bills are now being considered by the state’s lawmakers to increase access to association financial and engineering records.

Florida law dictates that associations must provide prospective buyers with the community’s declaration, articles of incorporation, bylaws and any related amendments, as well as the rules of the association. They must also provide them with a Q&A/fact sheet covering voting rights, use and leasing restrictions, fees and assessments, and outstanding litigation with liabilities in excess of $100,000.

Flalegislature-300x169These documents may be provided in hardcopy or digital forms, but digital records are preferred and can be prepared for easy access via a shareable weblink. The records must also be made available for scanning, copying or photographing, so hardcopies should also be available for use as needed. Only the “actual cost” involved in preparing and providing the documents may be passed on to prospective buyers, so there should not be any costs for cases in which only digital access is requested and provided.

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Oscar-Rivera-2015-hi-res-200x300The latest edition of the firm’s exclusive Real Estate Counselor column in the Miami Herald appeared in today’s Neighbors section and was authored by managing shareholder Oscar R. Rivera.  Titled “Condo Terminations Take Hold as an Exit Strategy for Owners at Aging Towers,” the article focuses on the legal termination of older condominium communities and buyout of all the unit owners to make way for new construction.  Oscar writes that the owners of units in aging condo communities near the water are receiving more offers from industry-leading developers than ever before, and some of these offers are coming just as the 40- and 50-year recertifications for their towers come due.  His article reads:

. . . The costs for repairs, even at the 40-year mark, can be too much for many unit owners to afford. Some associations’ financial reserves are woefully inadequate, or even nonexistent, so they would need to impose significant special assessments to pay for major repairs.

Herald-ORivera-print-clip-2-13-22-300x300In such cases, offers that are sometimes two to three times over market value for each unit can become a very appealing exit strategy for owners, and Florida has a legal mechanism for such condominium terminations that has proven to be effective. Terminations led to the development of the Armani/Casa tower in Sunny Isles Beach and the Una Residences now under construction in the Brickell area.

For developers, the math is even simpler than that of the unit owners. Once the value of the land for redevelopment becomes greater than that of the combined property values of all the existing units in a community, a condominium termination presents a fruitful opportunity.

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When disagreements and disputes arise amongst those who serve on community association boards of directors, emotions can run high in light of the impactful nature of the decisions made by such directors.  However, as association directors are duty bound to act in the best interests of their community and its owners, they should seek to avoid engaging in personal spats and attacks with one another and the owners that could lead to potential legal liabilities for the association.

One of the best examples of the dangers of public rows between association directors and unit owners is now playing out at the Porta Bella Yacht and Tennis Club in Boca Raton (pictured below).  As chronicled in a recent report from www.BocaNewsNow.com, homeowner Samuel Loff filed a lawsuit against the association premised upon an allegation that its board members made inappropriate and inaccurate accusations against him as part of a retaliation campaign.

pbella-300x255The lawsuit alleges that the community’s board of directors retaliated against Loff for an email that he sent to them complaining about security shortfalls and announcing his candidacy for a board seat.  Shortly after his email, the suit alleges that the board began accusing him of making unwanted advances to a female security guard, and it later put those accusations in writing via an email distributed to all the unit owners.

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A report that aired in late November on 7News (WSVN-Fox) in South Florida focused on a local renter in a dispute with her condominium association over her motorcycle. While the property’s rules ban motorcycles, the tenant had apparently been explicitly told she would be allowed to keep and park her motorcycle at the property prior to signing her lease. Three years later after she’d been using and parking her motorcycle at the property without complaint, she received a notice from the association indicating that it had to go or it would be towed.

It appears that the tenant’s response was to call or email the TV station’s tip-line, and the end result was another thoroughly investigated and highly informative “Help Me Howard” segment by its senior reporter Patrick Fraser and long-time legal expert Howard Finkelstein.

The report chronicles how Alexa Polcyn had been allowed to use and keep her motorcycle at the property for over three years until the association suddenly began “hassling our landlord about it.” She tells Fraser that she had noticed the restriction on her lease but was expressly told by the association that her motorcycle was not going to be an issue.

wsvn-logoThe association was apparently true to its word until three years later in late 2021 when it decided it would begin enforcing its motorcycle ban. It issued her a written notice that the motorcycle had to go, so the question for the station’s legal expert was whether the association could now change its mind on an exception to its rule that it had previously granted?

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Oscar-Rivera-2015-hi-res-200x300Managing shareholder Oscar R. Rivera was proud to be selected by the editors of the Daily Business Review, South Florida’s exclusive business daily and official court newspaper, for the publication’s weekly “Leading the Way” column featuring extensive Q&A interviews with South Florida legal leaders.  Now closing in on his fourth decade with the firm, Oscar discusses in today’s article the changes that the firm and the entire legal profession have experienced during the pandemic, and how we have successfully contended with all of the challenges and continued growing.  The article reads:

. . . While Rivera has worked on some of Miami’s most visible developments since joining the firm in 1984 — including representing the developer of 200,000-square-foot Mary Brickell Village — he hasn’t encountered every legal issue his clients face.

Putting heads together to solve new problems was easier before COVID, Rivera said. So was getting to know law clerks’ personalities and training young lawyers. And even if the pandemic were eradicated tomorrow, Rivera knows that many lawyers and staff, including those at his own firm, don’t want to come back every day.

dbr-logo-300x57At the end of 2021, firm founder Steven Siegfried stepped down from his role as co-managing partner, leaving Rivera to lead the evolution of Siegfried Rivera in an eventual post-COVID world.

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