Get ready, condominium unit owners. Most of the provisions in this year’s condo reform bill, unanimously passed by the House and Senate and recently signed by Gov. Ron DeSantis, take effect on July 1.
The bill is the Legislature’s third attempt since the 2021 collapse of the Champlain Towers South in Surfside to clarify safety measures imposed to prevent further catastrophes.
The new laws were promoted as a way to help low-income condo unit owners remain in their homes by allowing some associations to delay fully funding required reserves while financing repair costs. But some condo attorneys say they also include numerous requirements that will flummox elected board members — and possibly dissuade others from volunteering to serve.
The legislation includes a long list of changes and tweaks regarding how elections and meetings are conducted, how improvements are financed, how loans can be approved, and what records must be maintained and where. It also tightens oversight by the state over association functions.
“I think there are some admirable attempts at productive legislation,” says Daniel Weber, who practices condominium and planned development law at the Palm Beach County firm Sachs Sax Caplan PL.
“I also am quite firm on the sense that some of the legislation misses the mark, and is probably going to cause unnecessary constraints on boards, and frankly, give counsel headaches in trying to determine how to administer some of these changes to the law.”
Examples cited by Weber include a requirement that boards conduct meetings in physical spaces as well as by video conference, which he calls “an unnecessary burden and hurdle.”
Another provision requires board members to appear during annual meetings, including meetings held to elect new board members. To require the old board to show up in person “and just sit there when they may not be running, they may not win, and they have no function … is a bit too far reaching,” Weber says.
Yet another new provision requires boards that plan to propose budgets exceeding previous year’s budgets by 115% to also prepare a second budget that removes “non-discretionary funding” and propose it along with the preferred budget. But the legislation doesn’t define “non-discretionary funding items,” Weber says.
Roberto Blanch, who practices community association law at the Siegfried Rivera law firm in Coral Gables, said a provision allowing unit owners to vote by email “did a decent enough job of describing how that might work” but left “questions that linger as to how effective that option is going to be and does it expose or provide opportunities for fraud in elections that were not really there before.”
A provision allowing associations “to kick the can down the road” by extending the deadline to complete their Structural Integrity Reserve Studies (SIRS) and fund their reserve does not address whether associations that already completed theirs can delay funding of their reserve, he said.
“Then the question becomes, did this legislation give you one more year of exemption from having to fund it? Or are you obligated to fund it?” he says. “Some people who have read the statute say, ‘Oh, you are rewarding the procrastinators while those people who acted diligently arguably have to fund their reserves.’”
One provision clarifies that milestone inspections and Structural Integrity Reserve Studies are only required if all three stories of a building are “habitable,” Blanch says. “But they didn’t include the word ‘habitable’ in every section that applies” to the inspection requirements, he said.
The attorneys also cite as potentially troublesome the provision that allows associations to finance their repairs and reserves with lines of credit or loans — if approved by a majority of voting interests.
“Then the question becomes, you know, are the banks really going to lend?” Blanch says. “And if you ask some that are in the lending industry, they might say that they’re reluctant to tie up some of their lending capacity by allowing condominium associations to indefinitely sign lines of credit on which they may or may not draw upon for x number of years.”
Weber says that a “vast majority” of associations have no clause in their governing documents preventing them from borrowing money. In those cases, associations have relied on laws governing nonprofit organizations that extend borrowing authority to governing boards.
But now approval of a majority of voting interests is necessary, creating a hurdle that will prevent boards from using their business judgment “to fund any kind of common expense,” he said.
“It’s hard to get people to participate in voting on anything,” he says. “There are many communities with snowbirds, renters, investment communities. They just don’t pick up the phone. They don’t answer the mail.”
Blanch concurs that attracting a majority of voting interests could be difficult. Annual condominium board elections require ballots to be cast by 20% or eligible members, he said, and it’s often difficult to get that level of participation.
Jeffrey Margolis, a real estate attorney for Fort Lauderdale-based Berger Singerman LLP, says he suspects the borrowing authority and funding pauses allowed in the new legislation will buy more time for low-income, elderly unit owners to keep their units.
But for some, it will set redevelopment efforts back by delaying owners’ inevitable decision to sell, he says.
“It could potentially create a situation where the owners are not in such a bind that they need to sell their unit. So it could make it harder for developers to make deals with owners who won’t have this huge financial obligation that they have to meet.”
Still, Danielle Blake, chief of residential and advocacy for the Miami Association of Realtors, said that many of the provisions in the legislation will make it easier for condo owners to sell their units in what has become a challenging market.
They include enlarging the number of condominiums required to post meeting minutes and videos of board meetings on community websites beginning Jan. 1. Currently, that’s required only for condominiums with 150 of more units. After Jan. 1, it will apply to properties with 25 or more units.
The information will make it easier for lenders to determine whether special assessments are planned that could affect a borrower’s ability to handle a loan, she said.
The Realtors also pushed for oversight by the state Department of Business and Professional Regulation of spending on repairs identified in milestone inspections, she said. The legislation requires local government enforcement agencies — typically building departments — to conduct a census of buildings in their cities or counties that need repairs and send that information to the state.
“Now the department has the ability to go in and make sure that those repairs were completed, especially after the funds have been collected,” she said.
To implement the new law, lawmakers approved about $1 million for 10 new positions within the Department of Business and Professional Regulation. The new positions would include a real estate development specialist, an assistant investigations manager and seven financial examiners/analysts.
The new workers would handle an expected rise in complex investigative cases, primarily financial allegations, according to a spokeswoman for the bill’s primary sponsor, state Rep. Vicki Lopez of Miami-Dade County.
Blanch says he worries that all of the technical requirements will make it harder to find volunteers to serve, unpaid, on boards.
“It gets to the point where the good directors and the good volunteers start, you know, scratching their heads and pondering whether it’s even worthwhile for them to be on the board,” he said.
Asked if he agreed that the legislation will create unnecessary difficulties for associations and their boards, Travis Moore, a lobbyist for the trade group Community Associations Institute, who was credited by legislators for helping to shape this year’s bill, simply replied, “No.”
And of course, the legislation won’t be the final say on all matters condominium. In years past, the Legislature has enacted sweeping reforms with measures that condo managers, attorneys, boards and unit owners found unworkable. Those are often repealed the following year with what has become known as “glitch bills.”
Highlights of the new legislation
Inspections and repairs:
— Associations can delay completion of its Structural Integrity Reserve Study (SIRS) until Dec. 31 of this year. Previously, the study was required by Dec. 31, 2024.
— Associations will be required to submit the status of their milestone inspections to the Florida Department of Business and Professional Regulation (DBPR) every year. DBPR, in turn, must provide the information to the Office of Program Policy Analysis and Government Accountability, which will compile a report for the Legislature.
— Milestone inspections are now required for condo buildings consisting of three or more habitable stories. This eliminates confusion over buildings with first floors that are not used for condo units.
— Licensed architects or engineers who bid to perform milestone inspections must disclose in writing any intent to bid on services that the inspection might recommend.
— Any licensed contractor or design professional submitting a bid to perform services recommended by a milestone inspection must disclose in writing any direct or indirect interest in the firm providing the milestone inspection.
Managers:
— Community association managers whose licenses are revoked will be barred from working as a manager for 10 years.
— If a community association manager proposes or enters into a contract worth more than $2,500 for goods or services with the association — or holds an interest in or is paid by a company that would provide services — the association must solicit multiple bids from other third-party providers. If a manager violates this requirement, the association may terminate the management contract.
— Associations must provide the name of their managers, hours of availability and a summary of duties on their websites.
Board meetings and records:
— Beginning on Jan. 1, condominiums with 25 or more units must post digital copies of official records on its websites. The threshold is currently 150 or more units.
— Governing boards may conduct meetings in person or by video conference. If conducted by video conference, the meeting notice must include a hyperlink and conference telephone number that unit owners can use to attend, as well as a physical location for unit owners who want to attend in person.
— Meetings conducted via video conference must be recorded, and the recordings must be maintained as official association records.
— Unit owner meetings, including annual meetings, can be conducted in person or via video conference. If the annual meeting is conducted via video conference, a quorum of the board must be physically present at a location where unit owners can attend in person. If the bylaws do not provide the location, the meeting must be held within 15 miles of the condominium property or within the same county.
— Unit owners may vote electronically during meetings conducted via video conference.
— Associations must maintain in their official records the minutes of all meetings of the association, governing board, any committees and the unit owners, as well as recordings of all meetings conducted by video conference, plus all bank statements, ledgers, and copies of all affidavits.
— Associations must post on their websites or make available for download within 30 days the minutes of all board meetings over the past 12 months, video recordings or hyperlinks to videos of any meeting conducted by video conference, and all affidavits required by Florida condo laws.
— In lieu of delivering financial reports to owners, associations can provide a notice that it will mail, hand deliver, or electronically deliver a copy to the unit owner within five days after receipt of the owner’s written request.
— The Department of Business and Professional Regulation is authorized to investigate and review completion of milestone inspections, required repairs, insurance policies or fidelity bonding for all persons who control or disperse funds, board member education requirements, and SIRS reporting requirements.
— Associations must provide to the department contact information for board members, total numbers of buildings, and the amount and purpose of association assessments.
Budgets and reserves:
— If a board proposes an annual budget that would require assessments against unit owners that exceed 115% of what was assessed the previous year, the board must simultaneously propose a substitute budget that excludes non-discretionary funding.
— Unit owners must be notified at least 14 days in advance that a substitute budget will be proposed.
— Required expenditures in reserve accounts must include items with deferred maintenance or replacement costs exceeding $25,000, and not $10,000 as is currently the case. Other required expenditures are roof replacement, building painting, and pavement resurfacing.
— Reserves can be waived if an association votes to terminate the condominium.
— Reserves for SIRS items can be funded by lines of credit or loans upon approval of a majority of the total voting interests.
— The line of credit or loan must be immediately available for access by the board without further approval by association members.
— The line of credit or loan must be included in the annual financial statement provided to unit owners and prospective purchasers.
— Boards may pause contributions to reserves without approval of a majority of members if a local building official declares the building uninhabitable due to a natural emergency.
— A majority of voting interests may vote to temporarily pause or reduce reserve funding for up to two years if an association has completed a milestone inspection within the previous two years. This will be allowed for budgets adopted on or before Dec. 31, 2028.
— To determine funding needs and to recommend a reserve funding plan, associations that paused reserve funding must compete a SIRS before resuming reserve funding.
— Associations must obtain an updated SIRS before adopting any budget in which reserve funding does not align with the funding plan from the most recent SIRS.
— If any portion of the facilities are shared, associations must receive a complete financial report of all costs for maintaining the shared facilities within 60 days after the end of each fiscal year. They also have 60 days after receiving the report to challenge how those costs are apportioned.
Investments
— Boards must use best efforts to make prudent investment decisions that carefully consider risk and return in an effort to maximize returns on invested funds.
— Investments of reserve funds in one or any combination of certificates of deposit or in depository accounts at a community bank, savings ban, commercial bank, savings and loan, or credit union can be made without a vote of the unit owners.
Elections
— Associations must adopt a resolution for electronic voting during the next election if at least 25% of the voting interests petition for it within 180 days after the last scheduled meeting.
— Associations must designate an email address for receipt of electronically submitted ballots unless the association has adopted other lawful methods of electronic voting.
— Associations are required to count ballots transmitted electronically.
Hurricane protection
— Assessments against unit owners are prohibited if the association removes or reinstalls hurricane protections such as windows and doors that would otherwise be the unit owner’s responsibility.
— Evacuation of a condominium property is required in the event of any evacuation order, and not only a mandatory evacuation order.
— Every condo association must provide adequate property insurance regardless of what the declaration says.
Correction: An earlier version of this news article misstated information about positions funded by the Department of Business and Financial Regulation to implement the new condo law. Ten positions have been earmarked in the state’s 2025-26 budget to investigate and enforce complaints.
Ron Hurtibise covers business and consumer issues for the South Florida Sun Sentinel. He can be reached by phone at 954-356-4071 or by email at rhurtibise@sunsentinel.com.
