Florida House of Representatives
Representative Julio Robaina
District 117
District Office
6741 S.W. 24th Street
Miami, Fl. 33155-1766
(305) 442-6868
Room 404 H.O.B
402 S. Monroe Street
Tallahassee, FL.32399-1300
(850) 488-6506

First Report And Recommendations By Chairman Julio Robaina,
SELECT COMMITTEE ON CONDOMINIUM ASSOCIATION GOVERNANCE 

January 21, 2004

The Honorable Johnnie Byrd
Speaker of the House
Room 420, The Capitol
Tallahassee, Fl. 32399

Dear Mr. Speaker:

First and foremost I would like to thank you for granting me the honor to serve as Chair of the Select Committee on Condominium Association Governance, and on behalf of myself and my committee members, we would also like to thank you for the opportunity to have been able to listen to our constituents around the State of Florida and their concerns about the current conditions of Condo and Homeowner Associations.

Mr. Speaker, this has been one of the most challenging and eye opening experiences that I and the entire committee will probably experience as members of the Florida House. The turn-outs especially in Dade and Broward County were extremely high with an average of 300 people wanting to speak about the problems they were facing. In addition to the large turn-outs, enormous amounts of documents were also sent to my office and brought to the hearings, not to mention the thousands of e-mails we received from residents who live in condo or homeowner associations. 

Today, after listening to all public testimony throughout the State of Florida, I will submit to you a number of concerns posted by the residents of this state and a number of my suggestions along with those referred to me by my committee members for possible changes to F.S. 718 and F.S. 720.
 
The first and most important thing that we as a Select Committee must recommend to you is that the monies allocated to the trust fund that are generated by the condo unit owners be left to serve only the condo/ homeowner’s association’s needs and not diverted from the account to help fund other initiatives of the state. The trust fund is currently funded by a $4 unit fee paid by 1.1 million unit owners in the state of Florida. These funds are essential in bringing forth the much needed changes and also to further the education of homeowners and board members. Some of the recommendations are as follows:
 

Select Committee On Condominium Association Governance
Proposed Changes to F.S. 718 and F.S. 720
CURRENT PROBLEMS PROPOSED CHANGES
  • Lack of awareness by potential buyers such as being notified whether or not the association is or was in litigation or has incurred or will be incurring liabilities.  Also, buyers were not given other pertinent information such as the condition of the structure that might help them make a more informed decision before purchasing the property.
  • “Buyer Beware,” requiring a new Question and Answer sheet to be given to the potential buyer at the time of contract and again at the closing.
  • Lack of quality control of potential board members to verify that the association is adhering to current laws that prohibit convicted felons from serving on a board. 
  • Background checks for potential board members.
  • Board members did not live in the community and/or country due to the fact that they are investment properties and not their primary residence.
  • Board members must live in community year round in order to sit on the board.
  • The number of votes given to the owners of multiple units gave them to much power and control. 
  • Multiple unit owners are only allowed one vote regardless of their multiple units.
  • Multiple family members or relatives were serving on the same board creating a conflict of interest.
  • Immediate family members may not serve on a board simultaneously.
  • Board members, CAMS, and/or property management companies are giving friends or family or companies that they are affiliated with contracts for work in the community.
  • Conflicts of interest must be disclosed by board members, CAMS, and property management companies on potential contractors doing business with that community and board members may not be allowed to vote on the particular contract.  If the conflicting contractor is chosen by the vote of the board, the conflict must be disclosed to and approved by the majority vote of the unit owners.  This supercedes any and all association bylaws 
  • Contracts were given out without a competitive bidding process.
  • Board must provide or make available no less than 3 bids or proposals for all contracted work.
  • Board members are serving for extended periods of time not allowing others to serve on board.
  • 2 year term limits on board members unless there are no other volunteers then the term can be extended upon the approval of the majority vote of the unit owners.
  • Owners are being impacted fiscally and through hardships by Board member decisions.
  • Issues voted on by board members that create a fiscal impact or hardship for the owner, must be approved and voted on under a special election by the majority of the unit owners. Grandfathered clauses should also be considered under certain circumstances.
  • Owners are not able to view financial statements in a timely manner.
  • Allowing an addendum that supercedes association bylaws to allow owners to access financial records at any time upon their request of such records.
  • No disclosure of former criminals moving into communities. 
  • Mandatory criminal background checks for all new potential unit owners and for those attempting to rent done by the current board.
  • Currently there is no department  that  has the power to settle disputes between homeowners or condo owners  and their respective associations, that can help monitor elections and meetings, can fine board members, etc  provided by the state 
  • Create an Ombudsman’s office with a 5 member commission or Advisory Council appointed by the state.
  • Ombudsman’s office  will have staff  that has the power to audit statements work in conjunction with D.B.P.R., conduct investigations on-site, follow-up on complaints, monitor board meetings and elections, and will have the legal power to bring disputing parties that are unable to reach an agreement before him/her and their 5 member 
  • The Ombudsman will also have the power to fine board members or remove them from office.
  • Liens being placed on unit owners and home owners without notice.
  • Liens may not be placed without giving unit owners and homeowners at least a 30 day notice by the attorney via certified mail.
  • Unit owners are not given sufficient time to respond or correct the violation and sometimes are being cited with fines immediately.
  • Unit owners must have a minimum of 30 days to respond to any notice of violations and/or liens received via certified mail. 
  • Board members willfully and knowingly expediting the lien and foreclosure process in order to buy the properties themselves at a foreclosure price.
  • Hold board members accountable and provide penalties for those who willfully and maliciously place liens in the attempt to foreclose on other unit owners properties.
  • No caps exist on attorneys fees and they can charge without limits.
  • A cap on attorney’s fees for form letters sent to owners.
  • Board members or family of board members are employed by the management companies of many associations.
  • If a board member or family of a board member is employed by the management company of the association then the management company cannot do business with that community.
  • Board members do not file any type of financial disclosures.
  • Board members have to file a financial discloser, even if it’s a simple version. Affidavits must be signed by all parties including contractors that monies were not received or paid out to among board members, CAM’s, property management companies and contractors.
  • Department of Business and Professional Regulations does not have authority to arrest and criminally charge board members.
  • Empower the D.B.P.R. and the Ombudsman to take any findings of a criminal nature and submit them as evidence to the State Attorneys office, and work with them to bring charges against the board members, CAMS, property management companies or any other alleged parties involved.
  • Currently residents do not know how the state addresses their rights and concerns
  • Create a Condo and Homeowner’s Bill of Rights.  Condo and Homeowners should have a comprehensive bill of rights, which should include a section on how the state will address and protect their rights and concerns
  • Currently you have D.B.P.R. licensing and the C.A.M. division regulating so D.B.P.R. is not aware of any complaints brought against the C.A.M’s when renewing their C.A.M licenses. 
  • Merge the Community Association Management (CAM) Division into the Condo Division.  When CAM’s are renewing their licenses, the Division should be able to reference their complaint file when taking their application into consideration
  • No clear guidelines for special assessments.
  • Establishing clear guidelines for special assessments.
  • Reserves not being maintained at any specific percentage rate.
  • Require associations and developers to maintain reserves at a certain percentage.

Mr. Speaker:

I submit this report to you and will personally file a bill next week to create the changes needed to Florida Statutes 718 and 720.

Respectfully,

Julio Robaina
State Representative
District 117


In the name of many Homeowners and Condo Owners in Florida:
THANK YOU,

HONORABLE REPRESENTATIVE JULIO ROBAINA