SB 872

We should support SB 872, entitled “Homeowners' Associations”  and HB 665 entitled “Homeowners' Association Rental Agreements.”    These bills amend s. 720.306, F.S., which governs homeowners’ associations.   The provision states that any document or amendment enacted after July 1, 2021, allows the association to amend its governing documents to prohibit or regulate rentals for terms less than 6 months, as well as prohibit rentals more than three times in a calendar year, with an exception for associations of 15 or fewer parcel owners under s. 720.303(1), F.S.   Aimed at ensuring that HOA communities are not burdened by parcel owners who, instead of using their homes as their residence, choose to rent their homes out on air bnb, or other transient rentals.   These provisions provide not only a safety net for a community (affected by having strangers in their neighborhood) but also can contribute to decline in property values because it no longer a residential community..   This provision also differentiates changes of ownership, and defines “affiliated entity".

Analysis of SB 872:  “Homeowners' Associations” (Senator Ray Wesley Rodrigues)

Amending s. 720.306, F.S. “Meetings of members; voting and election procedures; amendments.”
 

This provision amends s. 720.306, F.S.,  that any document, enacted after July 1, 2021, prohibiting or regulating leasing applies only to a parcel owner who acquires title to the parcel after the effective date of the governing document or amendment, or to a parcel owner who consents, individually or through a representative, to the governing document.    In addition, this provision allows that an association can amend its governing documents to prohibit or regulate rentals for a term of less than 6 months, as well as prohibit rentals more than three times in a calendar year, with such amendments applicable to all parcel owners, with an exception for associations of 15 or fewer parcel owners under s. 720.303(1), F.S.   This provision is identical to HB 665: Homeowners' Association Rental Agreements.

The provision defines the term “affiliated entity” to mean “an entity that controls, is controlled by, or is under common control with the parcel owner or that becomes a parent or successor entity by reason of transfer, merger, consolidation, public offering, reorganization, dissolution or sale of stock, or transfer of membership partnership interests.”   In addition, for a conveyance to be recognized as one made to an “affiliated entity, “the entity must furnish to the association a document certifying that s. 720.306, F.S. applies, as well as provide any organizational documents for the parcel owner and the affiliated entity which support the representations in the certificate, as requested by the association.     This provision also clarifies that a “change of ownership”  does not occur when a parcel owner conveys the parcel to an affiliated entity or when beneficial ownership of the parcel does not change.    Instead, a “change of ownership” occurs when, with respect to a parcel owner that is a business entity, each person that owned an interest in the entity at the time of the enactment of the amendment or rule conveys its interest in the business entity to an unaffiliated party. This provision is identical to HB 665: Homeowners' Association Rental Agreements.

ORIGINAL FILED VERSION OF SB 872