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Community Update

November 2021

In this Issue

Happy Thanksgiving! We are incredibly grateful to all our readers and hope you have a wonderful holiday weekend.

This month, our featured articles explore various topics from fuel station installation to reserves for HOAs. Also, be sure to check out the “Did You Know” section – Becker’s been nominated for a Diamond Level Readers’ Choice Award from the Florida Community Association Journal (FLCAJ) in recognition of our commitment to the success of shared ownership communities. We are proud of our contributions to the industry and are thankful to our readers and the FLCAJ for this honor. If you enjoy the classes and content we provide (including this monthly newsletter), we would love your vote!

During the 2021 Legislative Session, the Statue allowing unit owners to install electric vehicle charging stations was expanded to also include natural gas fuel stations. While board’s cannot prohibit the installation of these stations, they can impose certain requirements. Read more in this month’s featured article, “Natural Gas Fuel Stations.”

Is your association’s data security hygiene up to par? “Security Tips for Managing the Association’s Bank Accounts Online,” provides useful tips to help minimize your risk.

There were several revisions to Chapter 720, which went into effect July 1, 2021. One such revision deals directly with reserves for HOAs – we discuss what changed and what it means for boards in, “Are Reserves Still Mandatory for Homeowners’ Associations?”

The ability for condominium associations to terminate certain contracts using a statutory procedure is at the heart of “THIS CASE: Comcast of Florida LP v. L’Ambiance Beach Condominium Association, Inc.” Read more about what happened and why this case matters.


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:

EDITORS

Mark D. Friedman, Esq.
Mark D. Friedman, Esq.
Jay Roberts, Esq.
Jay Roberts, Esq.

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Natural Gas Fuel Stations

By: Yeline Goin, Esq.

A few years ago, the Florida Legislature recognized that the use of electric vehicles conserves and protects the state’s environmental resources, provides significant economic savings to drivers, and serves an important public interest. As a result, the Legislature created Section 718.113(8), Florida Statutes, to allow unit owners to install electric vehicle charging stations within the boundaries of the unit owner’s limited common element parking area. During the 2021 legislative session, the Legislature expanded the statute to allow unit owners to also install natural gas fuel stations for a natural gas fuel vehicle. The term “natural gas fuel” is any liquefied petroleum gas product, compressed natural gas product, or a combination of these products used in a motor vehicle. The term includes all forms of fuel commonly or commercially known or sold as natural gasoline, butane gas, propane gas, or any other form of liquefied petroleum gas, compressed natural gas, or liquefied natural gas. However, the term does not include natural gas or liquefied petroleum placed in a separate tank of a motor vehicle for cooking, heating, water heating, or electricity generation.

Click here to read more!

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Security Tips for Managing the Association’s Bank Accounts Online

By: Sara K. Wilson, Esq.

Increasing numbers of people and small businesses, including community associations, have switched to managing their bank accounts exclusively over the internet. Not surprisingly, these numbers surged even higher during the pandemic. While online banking has become common place, so have incidents of cybercrime and fraud. Banks of course use a variety of security measures to protect their customers’ accounts, but there are also steps that you as the customer should take to minimize risk.

Click here to read more!

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Are Reserves Still Mandatory for Homeowners’ Associations?

By: Elizabeth A. Lanham-Patrie, Esq.

There were several revisions to Chapter 720, which went into effect July 1, 2021. One of these revisions was to Section 720.303(6)(c) and (d), Florida Statutes.

Click here to read more!

thiscase

Comcast of Florida LP v. L’Ambiance Beach Condominium Association, Inc.

17 So.3d 839 (Fla. 4th DCA 2009)

By: Jay Roberts

The ability for condominium associations to terminate certain contracts using a statutory procedure is at the heart of THIS CASE. In 2002, Comcast of Florida, L.P. (“Comcast”) entered into an agreement with the condominium developer (on behalf of the Association) that granted Comcast an easement to install cables and offer cable television services to residents at a bulk-discount rate. Every unit owner received and paid for the cable service as part of a monthly maintenance fee. The termination provision in the agreement stated it would be subject to the conditions and regulations required under Chapter 718, Florida Statutes. Following turnover from the developer to the unit owners, the Association voted to terminate the agreement and sent written notice to Comcast in accordance with F.S. 718.302.

Section 718.302, Fla. Stat. (2002), provided in part:


(1) Any grant or reservation made by a declaration, lease, or other document, and any contract made by an association prior to assumption of control of the association by unit owners other than the developer, that provides for operation, maintenance, or management of a condominium association or property serving the unit owners of a condominium shall be fair and reasonable, and such grant, reservation, or contract may be canceled by unit owners other than the developer:
(a) … the cancellation shall be by concurrence of the owners of not less than 75 percent of the voting interests other than the voting interests owned by the developer….

After receiving notice of the termination, Comcast refused to open the distribution lock boxes. Ultimately, Comcast sued for declaratory and injunctive relief for breach of contract and trespass. Before a hearing was held, the Association hired another provider to rewire the building and provide services to all residential units. The trial court ruled in favor of the Association. On appeal, Comcast argued that F.S. 718.302 did not apply to Comcast’s services, because the contract was not one for operation, maintenance, or management of the condominium as required under the statutory language.

On appeal the Fourth District Court of Appeal found that the agreement explicitly required Comcast to operate and maintain the wires and lock boxes it had installed. The Court also noted that under F.S. 718.115(1)(d), the cost of cable television service obtained pursuant to a bulk rate contract is deemed a common expense. In light of the fact that the agreement provided for a cable television service, and that the cost was part of a monthly maintenance fee, and that Comcast was required to service and maintain the cable television, the Court concluded that the agreement was one for “operation, maintenance, or management” subject to F.S. 718.302 (NOTE: the 2021 version of this statute is substantially the same as the 2002 version).


So why does THIS CASE matter? The Florida Condominium Act provides various rights to condominium associations which become effective upon turnover of the association from developer-controlled to unit owner-controlled, including, but not limited to, the ability to terminate certain contracts. It is vital for associations which recently have undergone turnover to discuss the various rights which accrued on the date turnover with the association’s legal counsel.

qotm

Question of the Month

Our association will be holding its annual budget soon. After receiving the notice for this meeting, I called our association manager to ask how and where I could obtain a copy of the proposed budget. I was told that a copy of the approved budget would only be provided to the members after the budget meeting. In other words, the proposed budget would not be provided to the members in advance of the budget meeting at which the proposed budget would be considered and adopted. Is this right?

Joseph Adams discusses why the answer to this question depends on several factors, including whether the association is a condominium or HOA.

fcap

CALLING ALL BOARD MEMBERS AND COMMUNITY MANAGERS

As leaders in Community Association Law, we not only helped write the law – we also teach it.

Did you know Becker provides over 200 educational classes per year throughout the State of Florida on a variety of topics ranging from board member certification to compliance, and everything in between? Our most popular classes are now available online!

To view our entire class roster, visit:
beckerlawyers.com/classes

hurricane

Employment Law Change That Community Associations Should Be Aware Of

Ned Bassen & Jamie Dokovna

Senate Bill 1532 amending §409.2576, Florida Statutes went into effect. Previously, only employers with 250 or more employees were required to report newly hired and re-hired individuals to Florida’s State Directory of New Hires within 20 days of hiring. Independent contractors were excluded. Now, as of October 1, any employer, regardless of the number of employees that is a “service recipient” defined as “a person engaged in a trade or business who pays an individual for services rendered in the course of such trade or business” must report all new hires and re-hires to the State’s database. Additionally, employers must report their independent contractors who are paid $600 or more during a calendar year.

The purpose of the statute is to provide information to the Florida Child Support Program to facilitate the collection and disbursement of child support payments and to monitor and enforce child support payments. The statute, however, is silent regarding penalties for failing to report. That said, employers with less than 250 employees should update their onboarding process to include the new reporting requirements and all employers regardless of size should determine whether reporting requirements exist for any independent contractor used by them, update onboarding policies to reflect the changes in the law and provide training for those who perform onboarding and payroll, so they are aware of these changes.

summary

Condominium Associations Should Have Written Collection Policies & Procedures

FLCAJ

K. Joy Mattingly

The 2021 legislative session brought some significant changes to the Condominium Act, the Cooperative Act, and the Homeowners Association Act. These changes went into effect on July 1, 2021, and many of them impacted the collections and foreclosure process for community associations.

Click here to read more!

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Electric Vehicles, Coming Soon to a Parking Area Near You!

FLCAJ

Lilliana M. Farinas-Sabogal

With the all-electric Ford Mustang Mach-E currently arriving at car dealers, and the Ford F-150 Lightning arriving next spring, as well as Toyota, Nissan, GM, Audi, and so many others car makers already producing all-electric versions of their vehicles, it seems that what used to be considered a niche for adventurous Tesla explorers may become far more commonplace far sooner than many people thought. This is especially the case, given that the advertised MSRP for electric models of many of these vehicles appears to be comparable to their traditional gas-powered counterparts.

While the development in this new technology is exciting for many, it has also led to unexpected issues for some condominiums.

Click here to read the full article. .

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Florida Bar Condominium Law and Policy Life Safety Task Force Report

The Florida Bar Condominium Law and Policy Life Safety Task Force recently undertook an information-gathering and fact-finding mission pertaining to residential building operations in Florida. In October, the Task Force released its 175-page report which includes observations and recommendations on condominium safety.

Below are five of the key takeaways that board members, property managers, and owners should be mindful of. It is unknown at this time which of these recommendations, if any, will be included in a bill during the 2022 Legislative Session. We’ll continue to monitor and keep you apprised over the coming months. If you have any questions regarding the information contained in the report, please contact your Becker attorney.

  1. Board Authority: The Task Force has recommended that any impediments to a board’s ability to exercise its power and duty to manage and maintain the condominium property, including paying for same, be removed. For example, the report recommends that any limitation on borrowing or special assessment authority, including unit owner voting requirements, be declared retroactively void as against public policy. The same recommendations were made for any limitations on a board’s authority to pursue responsible parties for defective construction.
  2. Uniform Standards: One of the deficiencies in the current system found to exist by the Task Force was the lack of clear and consistent guidance to boards at the most basic level, including the content and frequency of structural inspections, reserve requirements beyond the statutory “paving, painting, roofing” categories, and the role of local governments and building departments. The Task Force Report includes a series of recommendations to create more bright line guidance for boards in understanding and addressing these issues.
  3. Reserves: The Task Force Report contains very detailed findings and recommendations regarding reserves. For example, it recommends that reserve studies be made mandatory and combined into a physical inspection report, and that such reports be signed and sealed by a Florida licensed engineer or architect. The report also recommends creating “mandatory” and “optional” reserves. Mandatory reserves would be the expanded list of items that have been required in “developer turnover reports” since 2008, and would include structural maintenance, water-proofing, and life safety systems.
  4. Liability Of Consultants and Professionals: The Task Force concluded that many of the consultants and professionals who are paid by associations (which are primarily run by volunteer, unpaid board members) seek to limit or disclaim their liability for the quality of the work they do, and in some cases even ask to be indemnified by the association for their own negligence. The Task Force concluded that such limitations and waivers should be declared void as against public policy, as well as any efforts by developers to disclaim warranties for original construction.
  5. Obsolescence: The Task Force Report notes that nearly two thirds (approximately 900,000 of 1.5 million) condominium units in Florida are 30 years old or older. Depending on a variety of factors (including location, construction methods, and historical maintenance), every building will eventually reach a point where the cost of maintaining it may far outweigh the wisdom of demolishing it, selling the land, and “cashing out”. This process is known as “termination.” The Task Force made specific recommendations to the Governor and the Legislature for termination laws to be closely reviewed and the constant tension between individual property rights and collective economic interest be reexamined.

Undoubtedly, these issues and many others will be the focus of much discussion and debate in the months to come. We will continue to keep you updated periodically.

Click here to read the full report. .

Can They Do That?

Becker’s “Can They Do That” video series tackles some of the unique problems that homeowners and renters face today. We answer your 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 past episodes from this series here.
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Becker Shareholder Michael Gongora Nominated As Latin Builders Association’s Elected Official of the Year

Becker is proud to announce that Michael Gongora has been nominated as Elected Official of the Year by the Latin Builders Association (LBA). Michael was recently elected for the third time to serve on the Miami Beach Commission (2017–2021). He is the former Chairman of the Miami Beach Latin Chamber of Commerce Board of Directors and the former Chairman of ECOMB – the Environmental Coalition of Miami & the Beaches.

“Whether the task is civic, charitable, business or legal in nature, Michael does the necessary work to reach a positive outcome,” said Perry Adair, Becker’s Miami Office Managing Shareholder. “His service to Miami Dade County and in particular Miami Beach, is admirable. It is gratifying to see his efforts recognized by an organization that is equally committed to the Miami-Dade community.”

Click here to read more..

Becker Steps Up to the Mic with Podcast,
‘Take It To The Board with Donna DiMaggio Berger’

Becker is thrilled to announce the launch of its community association-focused podcast, Take It To The Board with Donna DiMaggio Berger. For decades, our firm has served the legal needs of this industry through in-person conferences and roundtables, online educational webinars, in-depth blog posts, and easy-to-understand legislative updates; we are delighted to continue the conversation on yet another platform. Join us today!

CURRENT EPISODES:

  • Royal Service with James Donnelly
  • Fiscal Finesse with Nicole Johnson-Pendergrass
  • Nuisance or Necessary: Solving the “Pet” Problem with JoAnn Burnett
  • The Technology Tango with Brett Fielo
  • Community Immunity with David Ramsey
  • Considering the Cost of Counsel with Denise Lash
  • Rules & Referencing with Howard Perl
  • The Mental Health Challenge with Chris Ayub
  • Reserve Funds & Studies with Robert Nordland
  • Association Advocacy with Commissioner Mary Molina-Macfie
  • The Job of the Journal with Michael Hamline
  • HR Hacks with Jamie Dokovna – Part 1
  • HR Hacks with Jamie Dokovna – Part 2

Click here to visit “Take it to the Board”

DID YOU KNOW?

If you paid special assessments and/or funded reserves in your community association you may be able to offset any taxable gains when you sell your property.

The adjustment to your tax basis depends on a number of factors including whether your property is your primary residence, whether you are a US citizen, whether you are married or single and whether your sales price exceeds the current exemptions. Speak to your CPA about this and keep good records of these expenditures.