Bill Summary By
ANALYSIS OF BILL HB 1021
GENERAL BILL by Representative Vicki LopezEffective Date: 7/1/2024
We should support this bill. The bill provides several provisions to help members and owners in mandatory associations, including providing penalties on association managers, management firms, recourses on conflicts of interest; financial reports, criminal penalties and board meetings, director education (finally Boards will not be able to sign a piece of paper saying as certification) but instead have education on roles they are performing.
This bill addresses:
· Association materials.
(i)This bill creates Subsection (3) to Section 1 of section 468.436 and entitled “professional practice standards” requiring a community association manager or a community association management firm to return all community association official records within its possession to the community association within 20 business days after termination or receipt of a written request for return of the official records, whichever occurs first.
(ii) Failure to comply creates a rebuttable presumption that the manager or firm willfully failed to comply and will be subject to suspension of its license under s. 468.436, and a civil penalty of $1,000 per day for a maximum of 10 days, assessed beginning on the 21st day after termination of a contractual agreement to provide community association management services to the community association or receipt of a written request from the association for return of the records, whichever occurs first.
· Meetings. The Board of Directors must hold at least 4 meetings a year. Currently only one meeting is necessary to be held by Associations. The increased requirements will provide more knowledge to members interested in the way the Association is run.
· Conflicts of interests.
(i) The bill also creates Section 2. Section 468.4335, Florida Statutes, “Conflicts of interest” that a CAM (and/or their relatives) or community management company with a financial interest in a community association management firm, and the relatives of such persons, must disclose to the board of a community association any activity that may reasonably be construed to be a conflict of interest.
(ii) A rebuttable presumption of a conflict of interest exists if any of the following occurs without prior notice:
(a) If a contract with those who have a financial interest in a community association management firm, and the relatives of such persons, the association must also consider at least 3 bids from other third-party providers of such good or service.
(b) If the association receives and considers a bid to provide a good or service, community association manager or a community association management firm, to the proposed activity must be attached to the meeting agenda.
(c) Disclosures of possible conflict of interest must be entered into the written minutes of the meeting. Approval of the contract or other transaction requires an affirmative vote of two-thirds of all other directors present.
(d) At the next regular or special meeting of the members, the existence of the contract or other transaction must be disclosed to the members.
(e) Upon motion of any member, the contract or transaction must be brought up for a vote and may be canceled by a majority vote of the members present.
(f) If the contract is canceled, the association is liable only for the reasonable value of the goods and services provided up to the time of cancellation and is not liable for any termination fees, liquidated damages, or other form of penalty for such cancellation.
(g) Failing to disclose any conflict of interest as required by s. 468.4335 could result in disciplinary proceedings on suspension or revocation of licenses, and civil and criminal proceedings.
(h) In addition, includes a person who willfully and knowingly refuses to releases or otherwise produce association records with the intent to avoid or escape detection, arrest, trial, or punishment for the commission of a crime, or to assist another person with such avoidance or escape.
· Kickbacks to an officer, director, or manager who knowingly so solicits, offers to accept, or accepts any thing or service of value or kickback will be rewarded with charges of a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
· Hurricane protection. The bill provides that residential condominiums and mixed-use condominiums, need a statement that specifies whether the unit owner or the association is responsible for hurricane protection that is for the preservation and protection of the condominium property and association property.
· Website requirements. 718, F.S. 111 (12) OFFICIAL RECORDS now requires association condominium with 25 or more units to post digital copies of the documents specified in subparagraph 2. on its website or make such documents available through an application that can be downloaded on a mobile device.
· The division shall refer to local law enforcement authorities any person whom the division believes has engaged in fraud, theft, embezzlement, etc.
· The division director (or any officer or employee of the division and the condominium ombudsman or any employee of the Office of the Condominium Ombudsman) may attend and observe any meeting of the board of administration or unit owner meeting, including any meeting of a subcommittee or special committee, which is open to members of the association for the purpose of performing the duties of the division.
· Structural integrity. Within 45 days after receiving the structural in reserve study, the association must distribute a copy of the study to each unit owner or deliver to each unit owner a notice that the completed study is available for inspection and copying upon a written request. Distribution of a copy of the study notice must be made by the communication method provided by the owner.
EFFECTIVE JULY 1, 2024
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