CONDO TRUST FUND -- WHERE IS THE TRUST?

An Opinion By Jan Bergemann 
President, Cyber Citizens For Justice, Inc.

Published April 2, 2011

According to Merriam-Webster, a TRUST FUND is MONEY HELD IN TRUST. As explained in the Florida statutes, all condo owners [FS718.509], co-op owners [FS 719.501], time share holders [FS721.27-28] and mobile home owners [FS 723.009] living in communities regulated by these statutes pay into this fund, which seems to have been mistakenly called TRUST fund. 

I can assure you, the trust of the citizens paying into this fund is long gone. How would you feel if the money you are supposed to pay to finance the Division of Florida Condominiums, Timeshares, and Mobile Homes is raided by the Florida nearly every year, but the Division stays underfunded and understaffed? If you read the provisions in FS 718.501, you will realize that the Division is tasked with many important jobs, like enforcing and ensuring compliance with the provisions of this chapter, and providing information, education, mediation services and alternative dispute resolution for all owners who pay into this fund. 

But in recent years legislators are using this so-called trust fund as their petty cash source to close holes in budgets instead of using the money for the purpose intended. Tens of millions of dollars disappeared from this "earmarked" TRUST fund over the last few years, used for anything but what is being promised to the people whose money is collected under false pretenses. This year's House budget proposal shows $6.2 million are "earmarked" to be removed from the fund for a budget gap caused by many wrong decisions made by legislators. But since condo owners don't have a big lobby, this fund is an easy target. And it leaves the Division totally underfunded again -- in a time when financial chaos in our community associations causes an even higher need for the services of the Division.

Not every legislator is an attorney, but many of them are. Last I heard, attorneys are officers of the court -- 24 hours a day -- no matter if they act as legislators or anything else. An attorney once told me that two things would be a sure bet for an attorney to get his/her license suspended: Shoot a client in his/her office -- or embezzle (steal) money from a trust fund. 

This statement seems to be wrong, because none of the attorneys in the legislature was ever even reprimanded for voting in favor of stealing these funds from the rightful owners. Or maybe the excuse is: We just vote for it, we are not personally involved in the embezzlement of the funds.

Maybe it always depends whose money it is? Who cares about some condo owners who are being charged for services they don't receive as promised -- by Florida law. Case for the Attorney General? Consumer Fraud?

We saw the big hoopla about House Bill 5005, the bill that would have ended Community Association Manager Licensing and would have dissolved the Division of Florida Condominiums, Timeshares, and Mobile Homes. When the bad provisions were removed from the bill, everybody -- even the folks who were initially in favor -- claimed victory.

There may have been more sinister motives behind the removal of these provisions from that horrendous bill. Seeing what is going on this year in Tallahassee, I am more and more convinced that somebody in the legislature realized in the last moment that this would not only remove consumer protection -- who cares about consumer protection anyway in a time of economic misery? -- but as well would remove a great source of extra income for the legislature.   If the bill would have passed as originally drafted, the Trust Funds would have disappeared together with the Division of Florida Condominiums, Timeshares, and Mobile Homes and CAM Licensing.

And gee, who doesn't like extra money for doing nothing? There is always some extra money needed for pork hidden in the budget.