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In this Issue
Since early on in the pandemic, boards and management professionals have shouldered the immense responsibility of ensuring the safety of their residents. Now, with the imminent rollout of the vaccine, they will face a whole new set of challenges which we delve into in this issue of CUP. For those who wish to discuss this topic in greater detail, we encourage you to reach out to your Becker attorney. As always, we are more than happy to offer our assistance to you.
Also featured this month is a collection of the year’s most popular articles. Read on for helpful information on everything from voting certificate requirements to preparing budgets, holiday decoration restrictions, and collection policies.
TOP 4 ARTICLES OF 2020
Is a voting certificate required if a unit or parcel is owned by more than one person, a corporation, or another entity? Find out in, “Is a Voting Certificate Required if a Unit is Owned by an LLC?”
Boards may be wondering how best to prepare a budget when it’s anticipated that members will vote to waive or partially fund reserves. Get the answer to your questions in, “Does My Association Include Fully Funded Reserves in Its Proposed Budget?”
Does your association have the power to put the kibosh on neighbors’ over-the-top holiday displays? “Restricting Holiday Decorations in the HOA Setting,” examines this issue.
You’ve tried to collect payment from a delinquent owner and there’s been no movement on their end to settle the balance. What should you do? Find out in, “How Does Your Collection Policy Stack Up?”
If you have new members on your board or a new manager for your community and want them to be part of our Community Update, have them subscribe here:
Mark D. Friedman, Esq. & Jay Roberts, Esq., Editors
Is a Voting Certificate Required If a Unit Is Owned by an LLC?
Many governing documents include a provision requiring a voting certificate if a unit or parcel is owned by more than one person, a corporation, or another entity. In some cases, there is an exception for spouses, and other times, a voting certificate is only required if the unit or parcel is owned by a corporation. It is important to look at the actual language of the governing documents to determine when a voting certificate is required.
Does My Association Include Fully Funded Reserves in Its Proposed Budget?
With the budget season approaching, many condominium associations may wonder how to prepare a budget when it’s anticipated that members will vote to waive or partially fund reserves. The board must create a proposed annual budget that includes estimated revenues and expenses. In addition to annual operating expenses, Section 718.112(2)(f)(2)a, Florida Statutes, requires the proposed budget to reserve money for roof replacement, building painting, pavement resurfacing, and any other item that has a deferred maintenance expense or replacement cost that exceeds $10,000. Reserves are calculated based on a formula contained in the Florida Administrative Code, designed to accrue money over the useful life of the individual assets so that the association is not forced to impose special assessments to repair or replace the assets. Budgeting for reserves is complex because it requires estimating the remaining useful life of the building components, their future replacement cost, and accounting for the funds previously saved. The association should retain a reserve specialist to produce a reserve study periodically and work with its accountant to budget for reserves.
Restricting Holiday Decorations in the HOA Setting
The holidays just ended but it seems the question of holiday decorations lives on. Every year, holiday decorations seem to appear earlier and get more extravagant, and not just in the retail setting. While studies are showing that people who decorate for the holidays early are happier, what constitutes “too soon” or “too much” in a residential community can vary greatly depending upon individual homeowners’ nationalities, cultures, faiths, and even simply personal taste. Dealing with residents’ complaints about their neighbors’ decorations, while trying to maintain holiday cheer in the community, can leave an association feeling like it’s fighting a losing battle. With a bit of pre-planning, however, an association can take some of the stress out of the already hectic holiday season.
How Does Your Collection Policy Stack Up?
Collection of your community’s assessments is critical to maintaining a steady flow of income to support the association’s maintenance responsibilities and maintain the association’s overall fiscal health. Yet, with the more urgent day-to-day demands on property managers and volunteer board members, collections can often be neglected or completely overlooked.
Short-Term Rental Developments: Profits Not Necessary to Violate Residential Use Covenant
Short-term rental arrangements continue to plague community associations, with owners and powerful lobbying groups for companies like Airbnb constantly devising new tactics for avoiding restrictions.
The good news is that courts are providing a bulwark against such arguments in some cases. That’s what happened in a recent case out of Michigan where the owners asserted a novel theory for why their short-term rental activities didn’t violate the association’s residential use restriction. (Cherry Home Ass’n v. Barker, Leelanau Cty., Mich. Aug. 26, 2020).
The court’s ruling not only rejected the owners’ defense, it also provides some hope to associations that haven’t been able to amend their documents to deal with the onset of short-term rentals.
Click here to read the full article from the Community Association Management Insider.
Question of the Month
Q: Due to the ongoing COVID-19 pandemic, many of the seasonal owners in our condominium will not be returning this year. This raises concerns about how we should conduct the election for directors. We understand that owners cannot vote in the election by proxy, and we don’t use electronic voting. Is there an exception that will allow owners who cannot travel to Florida to participate in the election?
Shareholder Joseph Adams weighs in on the answer to this question and others.
Can They Do That?
This video series tackles some of the unique problems homeowners and renters face today. We answer questions, no matter how far-fetched they may seem. From service animals to nudists in your community, we get to the bottom of it and let you know – “Can They Do That?”
Catch up on popular episodes from the past year:
- Episode 24: New Budget That Includes a Contingency Fund
- Episode 23: Can Board Change the Way We Fund Reserves
- Episode 22: Condominium Funding Reserves
- Episode 21: Forbidding Political Signage
- Episode 20: Association Hurricane Shutdowns
- Episode 19: Unofficial Community Websites Causing Harm
- Episode 18: City Notice That Property Is in Violation of Local Code
- Episode 17: Insurance Company Litigating Local Claims Out of State
- Episode 16: Employer Mandated Quarantine After Traveling
- Episode 15: Painting Over Cracks in Stucco
- Episode 14: Levying Special Assessments for Renovations
- Episode 13: Disruptive Owners Interfering at Board Meetings
- Episode 12: Damages Stemming From an Abandoned Unit
Don’t miss out on new episodes of “Can They Do That?”
Subscribe to Becker’s YouTube channel!
Statewide Suspension of Community Association Classes
Becker has been closely monitoring the latest coronavirus (COVID-19) developments. In the continued interest of the health and safety of our clients and colleagues, we have made a decision to continue the suspension of all Community Association classes until further notice.
As always, we will keep you informed of any changes and updates.
CALLING ALL BOARD MEMBERS AND COMMUNITY MANAGERS
As a service to the community and industry, we are pleased to offer some of our most popular classes online! While our in-person classes remain suspended until further notice due to COVID-19, we are thrilled to bring you the following classes to participate in from the comfort of your own home.
- HOA/Condo Board Member Certification
- Disaster Preparedness and Recovery
- Anatomy of a Water Leak
- Understanding Our Bylaws
- Is a “No Pet” Building a Thing of the Past?
- How to Properly Run an Election
- Budgeting & Reserves
- Covering Your Assets: How to Avoid Board Member Liability
- Collection and Foreclosure Strategies for Community Associations
- Dealing with Difficult People
- Construction Projects Gone Wild
- 2021 Legal Update
2020 Legislative Guide
Our 2020 Legislative Guide is designed to help your volunteer board and management professionals understand and implement the new laws which impact community associations each year. Given the significant percentage of Florida’s population which resides in shared ownership communities, we are virtually guaranteed to have numerous association bills sponsored each year with some of those proposals becoming new laws.
DID YOU KNOW?
COVID-19 Vaccine Distribution Presents New Challenges for Boards and Their Management Professionals
As we turn to a new year, exciting news of advancements and wider distribution of COVID-19 vaccines appear on the horizon. While this is of course a welcomed development, the vaccines in and of themselves will bring new decision points for boards and their management professionals with respect to whether their associations are going to modify COVID-19 protocols which have been in place for much of 2020. From an executive level perspective, these protocols break down into two broad categories: (1) restrictions related to facilities; and (2) restrictions related to people.
We understand that the COVID-19 pandemic continues to be a fluid and difficult situation. However, with the welcomed news of vaccine distribution, boards need to initiate discussions and potential adjustments to their association’s COVID-19 protocols as you will likely receive questions or demands from your residents related to the vaccine. Naturally, any changes to your community’s COVID-19 protocols will need to be properly adopted at a duly noticed board meeting and those changes properly communicated to your residents.
Click here to read our full message regarding this topic.
If you are interested in discussing this in greater detail, please contact your Becker attorney.
Upcoming and Recent Webinars
Construction Road Map for Community Associations
Construction issues are a natural occurrence in the lifecycle of any community association. From issues found in new associations transitioning from developer control to those arising in mature communities, we’ll discuss everything managers and board members need to know to effectively navigate the construction dispute process, including what sources of recovery are available to you. Join us January 11 for this informative webinar with special guest Steven Mainardi, an expert in the fields of building restoration and construction defects. Register now!
January 11
3 p.m. – 4 p.m.
Castle Group’s COVID-19 Webinar Series: Season 2, Episode 5
Becker Community Association Shareholder Donna DiMaggio Berger participated in episode 5 of the second season of Castle Group’s COVID-19 webinar series. She was joined by Castle Group’s Founder and CEO James Donnelly as they continue exploring topics including the challenges associated with re-opening communities.
The holidays are a time for celebration and cheer, but, just like everything else, they’ll look a little bit different this year. Join members of our Community Association Practice for a discussion on how boards and managers can safely navigate this holiday season in the midst of a pandemic.
