SB 546

Relating to Homeowner's Associations


S546    GENERAL BILL by Senator Fasano (Compare H 0391)
Homeowner's Associations; authorizes certain associations to revive
lapsed covenants; revises notice requirements re levy of special
assessments; prohibits fine levied by association from becoming lien
unless governing documents claimed to have been violated are recorded in
public records; provides that certain mergers or consolidations do not
alter specified voting interests; amends provision re publication of
false or misleading info., etc. Amends Chs. 712, 720, 34. EFFECTIVE
DATE: 07/01/2006.
11/01/05 SENATE Filed

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   1 A bill to be entitled

   2 An act relating to homeowners' associations;

   3 creating s. 712.11, F.S.; authorizing certain

   4 associations to revive lapsed covenants;

   5 amending s. 720.302, F.S.; revising certain

   6 purposes for regulation; amending s. 720.303,

   7 F.S.; revising notice requirements relating to

   8 the levy of special assessments; authorizing

   9 associations to charge specified fees for

 10 providing certain information to prospective 

 11 purchasers or lienholders; limiting liability 

 12 for providing such information; revising 

 13 certain time requirements relating to annual

 14 reports of associations; amending s. 720.305,

 15 F.S.; prohibiting a fine levied by an

 16 association from becoming a lien unless the

 17 governing documents claimed to have been 

 18 violated are recorded in the public records; 

 19 amending s. 720.306, F.S.; providing that 

 20 certain mergers or consolidations do not alter 

 21 specified voting interests; limiting the right 

 22 of members to speak at membership meetings;

 23 amending s. 720.402, F.S., relating to

 24 publication of false or misleading information;

 25 clarifying that the section does not limit

 26 common-law rights; amending s. 720.405, F.S.;

 27 deleting a requirement that a proposed revived

 28 governing document not contain certain

 29 restrictive covenants; repealing s. 720.311,

 30 F.S., relating to an alternative dispute

 31 resolution process; amending s. 34.01, F.S.; 


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  1 conforming a cross-reference; providing an 

  2 effective date. 


  4 Be It Enacted by the Legislature of the State of Florida: 


  6 Section 1. Section 712.11, Florida Statutes, is 

  7 created to read: 

  8 712.11 Covenant revitalization.--A homeowners' 

  9 association that is not subject to chapter 720 may use the 

10 procedures in ss. 720.403-720.407 to revive covenants that 

11 have lapsed pursuant to this chapter.

12 Section 2. Section 720.302, Florida Statutes, is 

13 amended to read: 

14 720.302 Purposes, scope, and application.-- 

15 (1) The purposes of this chapter are to give statutory 

16 recognition to corporations not for profit that operate 

17 residential communities in this state, to provide procedures 

18 for operating homeowners' associations, and to protect the 

19 rights of association members without unduly impairing the 

20 ability of such associations to perform their functions. 

21 (2) The Legislature recognizes that it is not in the 

22 best interest of homeowners' associations or the individual 

23 association members thereof to create or impose a bureau or 

24 other agency of state government to regulate the affairs of 

25 homeowners' associations. However, in accordance with s. 

26 720.311, the Legislature finds that homeowners' associations 

27 and their individual members will benefit from an expedited 

28 alternative process for resolution of election and recall 

29 disputes and presuit mediation of other disputes involving 

30 covenant enforcement and authorizes the department to hear, 

31 administer, and determine these disputes as more fully set 


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  1 forth in this chapter. Further, the Legislature recognizes 

  2 that certain contract rights have been created for the benefit 

  3 of homeowners' associations and members thereof before the 

  4 effective date of this act and that ss. 720.301-720.407 are 

  5 not intended to impair such contract rights, including, but 

  6 not limited to, the rights of the developer to complete the 

  7 community as initially contemplated. 

  8 (3) Except as specifically provided in this chapter, 

  9 this chapter does not apply to: 

10 (a) A community that is composed of property primarily 

11 intended for commercial, industrial, or other nonresidential 

12 use; or 

13 (b) The commercial or industrial parcels in a 

14 community that contains both residential parcels and parcels 

15 intended for commercial or industrial use. 

16 (4) This chapter does not apply to any association 

17 that is subject to regulation under chapter 718, chapter 719, 

18 or chapter 721; or to any nonmandatory association formed 

19 under chapter 723. 

20 (5) Unless expressly stated to the contrary, 

21 corporations not for profit that operate residential 

22 homeowners' associations in this state shall be governed by 

23 and subject to chapter 617 and this chapter or chapter 607 if 

24 incorporated under that chapter. This subsection is intended 

25 to clarify existing law. 

26 Section 3. Subsections (2), (5), and (7) of section 

27 720.303, Florida Statutes, are amended to read: 

28 720.303 Association powers and duties; meetings of 

29 board; official records; budgets; financial reporting; 

30 association funds; recalls.-- 



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  1 (a) A meeting of the board of directors of an 

  2 association occurs whenever a quorum of the board gathers to 

  3 conduct association business. All meetings of the board must 

  4 be open to all members except for meetings between the board 

  5 and its attorney with respect to proposed or pending 

  6 litigation where the contents of the discussion would 

  7 otherwise be governed by the attorney-client privilege. 

  8 (b) Members have the right to attend all meetings of 

  9 the board and to speak on any matter placed on the agenda by 

10 petition of the voting interests for at least 3 minutes. The 

11 association may adopt written reasonable rules expanding the 

12 right of members to speak and governing the frequency, 

13 duration, and other manner of member statements, which rules 

14 must be consistent with this paragraph and may include a 

15 sign-up sheet for members wishing to speak. Notwithstanding 

16 any other law, the requirement that board meetings and 

17 committee meetings be open to the members is inapplicable to 

18 meetings between the board or a committee and the 

19 association's attorney, with respect to meetings of the board 

20 held for the purpose of discussing personnel matters. 

21 (c) The bylaws shall provide for giving notice to 

22 parcel owners and members of all board meetings and, if they 

23 do not do so, shall be deemed to provide the following: 

24 1. Notices of all board meetings must be posted in a 

25 conspicuous place in the community at least 48 hours in 

26 advance of a meeting, except in an emergency. In the 

27 alternative, if notice is not posted in a conspicuous place in 

28 the community, notice of each board meeting must be mailed or 

29 delivered to each member at least 7 days before the meeting, 

30 except in an emergency. Notwithstanding this general notice 

31 requirement, for communities with more than 100 members, the 


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  1 bylaws may provide for a reasonable alternative to posting or 

  2 mailing of notice for each board meeting, including 

  3 publication of notice, provision of a schedule of board 

  4 meetings, or the conspicuous posting and repeated broadcasting 

  5 of the notice on a closed-circuit cable television system 

  6 serving the homeowners' association. However, if broadcast 

  7 notice is used in lieu of a notice posted physically in the 

  8 community, the notice must be broadcast at least four times 

  9 every broadcast hour of each day that a posted notice is 

10 otherwise required. When broadcast notice is provided, the 

11 notice and agenda must be broadcast in a manner and for a 

12 sufficient continuous length of time so as to allow an average 

13 reader to observe the notice and read and comprehend the 

14 entire content of the notice and the agenda. The bylaws or 

15 amended bylaws may provide for giving notice by electronic 

16 transmission in a manner authorized by law for meetings of the 

17 board of directors, committee meetings requiring notice under 

18 this section, and annual and special meetings of the members; 

19 however, a member must consent in writing to receiving notice 

20 by electronic transmission. 

21 2. A special An assessment may not be levied at a 

22 board meeting unless the notice of the meeting includes a 

23 statement that special assessments will be considered and the 

24 nature of such the assessments. Written notice of any meeting 

25 at which special assessments will be considered or at which 

26 amendments to rules regarding parcel use will be considered 

27 must be mailed, delivered, or electronically transmitted to 

28 the members and parcel owners and posted conspicuously on the 

29 property or broadcast on closed-circuit cable television not 

30 less than 14 days before the meeting. 



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  1 3. Directors may not vote by proxy or by secret ballot 

  2 at board meetings, except that secret ballots may be used in 

  3 the election of officers. This subsection also applies to the 

  4 meetings of any committee or other similar body, when a final 

  5 decision will be made regarding the expenditure of association 

  6 funds, and to meetings of any body vested with the power to 

  7 approve or disapprove architectural decisions with respect to 

  8 a specific parcel of residential property owned by a member of 

  9 the community. 

10 (d) If 20 percent of the total voting interests 

11 petition the board to address an item of business, the board 

12 shall at its next regular board meeting or at a special 

13 meeting of the board, but not later than 60 days after the 

14 receipt of the petition, take the petitioned item up on an 

15 agenda. The board shall give all members notice of the meeting 

16 at which the petitioned item shall be addressed in accordance 

17 with the 14-day notice requirement pursuant to subparagraph 

18 (c)2. Each member shall have the right to speak for at least 3 

19 minutes on each matter placed on the agenda by petition, 

20 provided that the member signs the sign-up sheet, if one is 

21 provided, or submits a written request to speak prior to the 

22 meeting. Other than addressing the petitioned item at the 

23 meeting, the board is not obligated to take any other action 

24 requested by the petition. 


26 records shall be maintained within the state and must be open 

27 to inspection and available for photocopying by members or 

28 their authorized agents at reasonable times and places within 

29 10 business days after receipt of a written request for 

30 access. This subsection may be complied with by having a copy 

31 of the official records available for inspection or copying in 


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  1 the community. If the association has a photocopy machine 

  2 available where the records are maintained, it must provide 

  3 parcel owners with copies on request during the inspection if 

  4 the entire request is limited to no more than 25 pages. 

  5 (a) The failure of an association to provide access to 

  6 the records within 10 business days after receipt of a written 

  7 request creates a rebuttable presumption that the association 

  8 willfully failed to comply with this subsection. 

  9 (b) A member who is denied access to official records 

10 is entitled to the actual damages or minimum damages for the 

11 association's willful failure to comply with this subsection. 

12 The minimum damages are to be $50 per calendar day up to 10 

13 days, the calculation to begin on the 11th business day after 

14 receipt of the written request. 

15 (c) The association may adopt reasonable written rules 

16 governing the frequency, time, location, notice, records to be 

17 inspected, and manner of inspections, but may not impose a 

18 requirement that a parcel owner demonstrate any proper purpose 

19 for the inspection, state any reason for the inspection, or 

20 limit a parcel owner's right to inspect records to less than 

21 one 8-hour business day per month. The association may impose 

22 fees to cover the costs of providing copies of the official 

23 records, including, without limitation, the costs of copying. 

4 The association may charge up to 50 cents per page for copies 

25 made on the association's photocopier. If the association does 

26 not have a photocopy machine available where the records are 

27 kept, or if the records requested to be copied exceed 25 pages 

28 in length, the association may have copies made by an outside 

29 vendor and may charge the actual cost of copying. The 

30 association shall maintain an adequate number of copies of the 

31 recorded governing documents, to ensure their availability to 


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  1 members and prospective members. Notwithstanding the 

  2 provisions of this paragraph, the following records shall not 

  3 be accessible to members or parcel owners: 

  4 1. Any record protected by the lawyer-client privilege 

  5 as described in s. 90.502 and any record protected by the 

  6 work-product privilege, including, but not limited to, any 

  7 record prepared by an association attorney or prepared at the 

  8 attorney's express direction which reflects a mental 

  9 impression, conclusion, litigation strategy, or legal theory 

10 of the attorney or the association and was prepared 

11 exclusively for civil or criminal litigation or for 

12 adversarial administrative proceedings or which was prepared 

13 in anticipation of imminent civil or criminal litigation or 

14 imminent adversarial administrative proceedings until the 

15 conclusion of the litigation or adversarial administrative 

16 proceedings. 

17 2. Information obtained by an association in 

18 connection with the approval of the lease, sale, or other 

19 transfer of a parcel. 

20 3. Disciplinary, health, insurance, and personnel 

21 records of the association's employees. 

22 4. Medical records of parcel owners or community 

23 residents. 

24 5. The association is not required to give a 

25 prospective purchaser or lienholder information about the 

26 subdivision or the association other than that required to be 

27 disclosed under this chapter. It may charge the prospective 

28 purchaser, lienholder, or current parcel owner or member a 

29 reasonable fee not to exceed $150 to provide such information, 

30 other than information required by law, plus the reasonable 



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  1 cost of photocopying and attorney's fees incurred by the 

  2 association in connection with the response. 

  3 6. An association is not liable for providing such 

  4 information in good faith pursuant to a written request if the 

  5 person providing the information includes a written statement 

  6 in substantially the following form: "The responses herein are 

  7 made in good faith and to the best of my ability as to their 

  8 accuracy." 

  9 (7) FINANCIAL REPORTING.--The association shall 

10 prepare an annual financial report by a date specified in the 

11 bylaws or within 90 60 days after the close of the fiscal 

12 year. The association shall, within 21 days after the report 

13 is prepared but not later than 120 days after the end of the 

14 fiscal year the time limits set forth in subsection (5)

15 provide each member with a copy of the annual financial report 

16 or a written notice that a copy of the financial report is 

17 available upon request at no charge to the member. Financial 

18 reports shall be prepared as follows: 

19 (a) An association that meets the criteria of this 

20 paragraph shall prepare or cause to be prepared a complete set 

21 of financial statements in accordance with generally accepted 

22 accounting principles. The financial statements shall be based 

23 upon the association's total annual revenues, as follows: 

24 1. An association with total annual revenues of 

25 $100,000 or more, but less than $200,000, shall prepare 

26 compiled financial statements. 

27 2. An association with total annual revenues of at 

28 least $200,000, but less than $400,000, shall prepare reviewed 

29 financial statements. 

30 3. An association with total annual revenues of 

31 $400,000 or more shall prepare audited financial statements. 


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  1 (b)1. An association with total annual revenues of 

  2 less than $100,000 shall prepare a report of cash receipts and 

  3 expenditures. 

  4 2. An association in a community of fewer than 50 

  5 parcels, regardless of the association's annual revenues, may 

  6 prepare a report of cash receipts and expenditures in lieu of 

  7 financial statements required by paragraph (a) unless the 

  8 governing documents provide otherwise. 

  9 3. A report of cash receipts and disbursement must 

10 disclose the amount of receipts by accounts and receipt 

11 classifications and the amount of expenses by accounts and 

12 expense classifications, including, but not limited to, the 

13 following, as applicable: costs for security, professional, 

14 and management fees and expenses; taxes; costs for recreation 

15 facilities; expenses for refuse collection and utility 

16 services; expenses for lawn care; costs for building 

17 maintenance and repair; insurance costs; administration and 

18 salary expenses; and reserves if maintained by the 

19 association. 

20 (c) If 20 percent of the parcel owners petition the 

21 board for a level of financial reporting higher than that 

22 required by this section, the association shall duly notice 

23 and hold a meeting of members within 30 days of receipt of the 

24 petition for the purpose of voting on raising the level of 

25 reporting for that fiscal year. Upon approval of a majority of 

26 the total voting interests of the parcel owners, the 

27 association shall prepare or cause to be prepared, shall amend 

28 the budget or adopt a special assessment to pay for the 

29 financial report regardless of any provision to the contrary 

30 in the governing documents, and shall provide within 90 days 



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  1 of the meeting or the end of the fiscal year, whichever occurs 

  2 later: 

  3 1. Compiled, reviewed, or audited financial 

  4 statements, if the association is otherwise required to 

  5 prepare a report of cash receipts and expenditures; 

  6 2. Reviewed or audited financial statements, if the 

  7 association is otherwise required to prepare compiled 

  8 financial statements; or 

  9 3. Audited financial statements if the association is 

10 otherwise required to prepare reviewed financial statements. 

11 (d) If approved by a majority of the voting interests 

12 present at a properly called meeting of the association, an 

13 association may prepare or cause to be prepared: 

14 1. A report of cash receipts and expenditures in lieu 

15 of a compiled, reviewed, or audited financial statement; 

16 2. A report of cash receipts and expenditures or a 

17 compiled financial statement in lieu of a reviewed or audited 

18 financial statement; or 

19 3. A report of cash receipts and expenditures, a 

20 compiled financial statement, or a reviewed financial 

21 statement in lieu of an audited financial statement. 

22 Section 4. Subsection (2) of section 720.305, Florida 

23 Statutes, is amended to read: 

24 720.305 Obligations of members; remedies at law or in 

25 equity; levy of fines and suspension of use rights; failure to 

26 fill sufficient number of vacancies on board of directors to 

27 constitute a quorum; appointment of receiver upon petition of 

28 any member.-- 

29 (2) If the governing documents so provide, an 

30 association may suspend, for a reasonable period of time, the 

31 rights of a member or a member's tenants, guests, or invitees, 


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  1 or both, to use common areas and facilities and may levy 

  2 reasonable fines, not to exceed $100 per violation, against 

  3 any member or any tenant, guest, or invitee. A fine may be 

  4 levied on the basis of each day of a continuing violation, 

  5 with a single notice and opportunity for hearing, except that 

  6 no such fine shall exceed $1,000 in the aggregate unless 

  7 otherwise provided in the governing documents. A fine shall 

  8 not become a lien against a parcel unless it is levied for a 

  9 violation of governing documents that have been recorded in 

10 the public records of the county where the property is 

11 located. In any action to recover a fine, the prevailing party 

12 is entitled to collect its reasonable attorney's fees and 

13 costs from the nonprevailing party as determined by the court. 

14 (a) A fine or suspension may not be imposed without 

15 notice of at least 14 days to the person sought to be fined or 

16 suspended and an opportunity for a hearing before a committee 

17 of at least three members appointed by the board who are not 

18 officers, directors, or employees of the association, or the 

19 spouse, parent, child, brother, or sister of an officer, 

20 director, or employee. If the committee, by majority vote, 

21 does not approve a proposed fine or suspension, it may not be 

22 imposed. 

23 (b) The requirements of this subsection do not apply 

24 to the imposition of suspensions or fines upon any member 

25 because of the failure of the member to pay assessments or 

26 other charges when due if such action is authorized by the 

27 governing documents. 

28 (c) Suspension of common-area-use rights shall not 

29 impair the right of an owner or tenant of a parcel to have 

30 vehicular and pedestrian ingress to and egress from the 

31 parcel, including, but not limited to, the right to park. 


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  1 Section 5. Subsections (1) and (6) of section 720.306, 

  2 Florida Statutes, are amended to read: 

  3 720.306 Meetings of members; voting and election 

  4 procedures; amendments.-- 


  6 (a) Unless a lower number is provided in the bylaws, 

  7 the percentage of voting interests required to constitute a 

  8 quorum at a meeting of the members shall be 30 percent of the 

  9 total voting interests. Unless otherwise provided in this 

10 chapter or in the articles of incorporation or bylaws, 

11 decisions that require a vote of the members must be made by 

12 the concurrence of at least a majority of the voting interests 

13 present, in person or by proxy, at a meeting at which a quorum 

14 has been attained. 

15 (b) Unless otherwise provided in the governing 

16 documents or required by law, and other than those matters set 

17 forth in paragraph (c), any governing document of an 

18 association may be amended by the affirmative vote of 

19 two-thirds of the voting interests of the association. 

20 (c) Unless otherwise provided in the governing 

21 documents as originally recorded or permitted by this chapter 

22 or chapter 617, an amendment may not materially and adversely 

23 alter the proportionate voting interest appurtenant to a 

24 parcel or increase the proportion or percentage by which a 

25 parcel shares in the common expenses of the association unless 

26 the record parcel owner and all record owners of liens on the 

27 parcels join in the execution of the amendment. For purposes 

28 of this section, a change in quorum requirements is not an 

29 alteration of voting interests. The merger or consolidation of 

30 associations under a plan of merger or consolidation pursuant 

31 to chapter 607 or chapter 617 is not a material or adverse 


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  1 alteration of the proportionate voting interest appurtenant to 

  2 a parcel. 

  3 (6) RIGHT TO SPEAK.--Members and parcel owners have 

  4 the right to attend all membership meetings and to speak at 

  5 any meeting with reference to all items opened for discussion 

  6 or included on the agenda. Notwithstanding any provision to 

  7 the contrary in the governing documents or any rules adopted 

  8 by the board or by the membership, a member and a parcel owner 

  9 have the right to speak for at least 3 minutes on any agenda 

10 item, if provided that the member or parcel owner submits a 

11 written request to speak prior to the meeting. The association 

12 may adopt written reasonable rules governing the frequency, 

13 duration, and other manner of member and parcel owner 

14 statements, which rules must be consistent with this 

15 subsection. 

16 Section 6. Subsection (3) is added to section 720.402, 

17 Florida Statutes, to read: 

18 720.402 Publication of false and misleading 

19 information.-- 

20 (3) This section does not limit any rights provided by 

21 common law. 

22 Section 7. Subsection (4) of section 720.405, Florida 

23 Statutes, is amended to read: 

24 720.405 Organizing committee; parcel owner approval.-- 

25 (4) The proposed revived declaration and other 

26 governing documents for the community shall: 

27 (a) Provide that the voting interest of each parcel 

28 owner shall be the same as the voting interest of the parcel 

29 owner under the previous governing documents; 

30 (b) Provide that the proportional-assessment 

31 obligations of each parcel owner shall be the same as 


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  1 proportional-assessment obligations of the parcel owner under 

  2 the previous governing documents; 

  3 (c) Contain the same respective amendment provisions 

  4 as the previous governing documents or, if there were no 

  5 amendment provisions in the previous governing document, 

  6 amendment provisions that require approval of not less than 

  7 two-thirds of the affected parcel owners; and 

  8 (d) Contain no covenants that are more restrictive on 

  9 the affected parcel owners than the covenants contained in the 

10 previous governing documents, except as permitted under s. 

11 720.404(3); and 

12 (d)(e) Comply with the other requirements for a 

13 declaration of covenants and other governing documents as 

14 specified in this chapter. 

15 Section 8. Section 720.311 is repealed. 

16 Section 9. Subsection (1) of section 34.01, Florida 

17 Statutes, is amended to read: 

18 34.01 Jurisdiction of county court.-- 

19 (1) County courts shall have original jurisdiction: 

20 (a) In all misdemeanor cases not cognizable by the 

21 circuit courts; 

22 (b) Of all violations of municipal and county 

23 ordinances; 

24 (c) Of all actions at law in which the matter in 

25 controversy does not exceed the sum of $15,000, exclusive of 

26 interest, costs, and attorney's fees, except those within the 

27 exclusive jurisdiction of the circuit courts; and 

28 (d) Of disputes occurring in the homeowners' 

29 associations as described in s. 720.311(2)(a) (2005), which 

30 shall be concurrent with jurisdiction of the circuit courts. 

31 Section 10. This act shall take effect July 1, 2006. 


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  1 ***************************************** 


  3 Revises provisions related to homeowners' associations. Provides for reviving lapsed

     covenants. Revises noticed 

  4 requirements related to special assessments. Authorizes fees for providing information

     to purchasers or 

  5 lienholders. Limits liability for disclosing such information. Revises time limits related to

     annual report 

  6 requirements. Prohibits certain fines from becoming liens unless certain governing

     documents are recorded. 

  7 Clarifies the effect of certain mergers or consolidations. Limits the right of members to

     speak at 

  8 meetings. Clarifies certain common-law rights. Deletes a requirement relating to the

     revival of governing 

  9 documents containing restrictive covenants. Repeals a provision providing an alternative dispute resolution 

10 process. 























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