Article Courtesy of the Sun Sentinel

By Joe Kollin
Published November 27, 2005

South Florida condominium and homeowner associations that saved for a rainy day breathed a sigh of relief after Hurricane Wilma last month. They had money in the bank to pay the uninsured costs of cleanup and repairs.

It's different in buildings and communities where owners didn't sock away money.

To pay for damage to fences, pools, roofs, windows, landscaping and other common property, boards are imposing special assessments and are requiring immediate payment. Angry residents are complaining to the state attorney general, writing President Bush and planning to recall their directors.

State law requires that condos maintain reserves for repairing and replacing roofs, painting buildings, resurfacing parking lots and other predictable and unpredictable expenses. Reserves can be waived only if a majority of owners agree at the annual meeting. When given a chance to vote, most owners waive reserves, experts say.

Homeowner associations aren't required to have reserves, so most don't, even though they are responsible for roads, landscaping, pools and other common expenses that the owners, generally in single-family houses, often don't even consider their responsibility.

A portion of special assessments may be covered in some owner's insurance policies.

The 20 owners in the Ventnor J condo association in Century Village East in Deerfield Beach may not have to pay another penny for cleanup and repair at their building, said vice president Barbara Miranda. The association has been putting money into a rainy day fund for years and when the costs are calculated, it may be enough.

The 307 owners in the Hampshire Homes Homeowners Association in Miramar also have a reserve account. The board will use it, but it does plan to raise the monthly maintenance from $70 to $85 to keep from depleting it, according to association president Victoria Justiniano.

At the Pines of Delray West condo in Delray Beach, owners in the 288-unit complex maintain a reserve so they don't expect a special assessment of more than $500 per unit, said treasurer Jean Resnick. Without the reserve, she said, the assessment would be much larger.

At Carriage Hills, a Davie condo community with 950 residences, owners Jerry Baimel and Thomas Abbott are angry because their board plans to assess each unit about $500.

They plan to launch a drive to recall the directors.

At the Oakland Forest Club condo in Oakland Park, owners are frustrated because the board wants to impose a $510 special assessment, according to owner Keisha Forbes. That's on top of a recent $3,000-per-unit roofing assessment that not everyone has paid yet.

"We plan to recall the board; that's how serious the issue has become," she said.

The fault for huge special assessments, experts say, lies with owners.

"Unit owners don't want to pay a little more each month to have a reserve," said Laura Manning, a West Palm Beach-based attorney with the Siegfried Rivera law firm, which represents about 500 associations in Broward, Palm Beach and Miami-Dade counties.

"People who are 80 years old say, `Why should I put my money away now to have the building re-roofed in 18 years,'" said Isadore Nachimson, treasurer at the 160-apartment Plymouth 2 association in Century Village of Pembroke Pines.

But people in retirement communities aren't the only ones who oppose reserves; owners in communities with younger residents generally have the same attitude.

"People in the younger condos vote down reserves also," said state Rep. Kenneth Gottlieb, D-Hollywood.

Should the state require reserves?

"It should be left up to the board, they know their [associations] better than Tallahassee and they should be able to do what they see fit," Gottlieb said.

"I'm against reserves, it puts money into coffers that directors can [illegally] get into," said Virgil Rizzo, the state condo ombudsman.

"Not having reserves is like passing on the federal debt to your children," said Blane Carneal, a Fort Lauderdale attorney who represents unit owners.

"While I'm living there it's my responsibility to pay my fair share," said Miranda, the Deerfield Beach owner who wants the state to make reserves mandatory.

Knowing that the alternative is huge special assessments, owners now may drop their opposition to reserves, said Keisha Forbes of the Oakland Park condo.

"Now we know we wouldn't be hit as hard," she said.