Florida Legislature Appears Poised to Strengthen State Oversight of Community Associations

The firm’s latest Miami Herald “Real Estate Counselor” column was authored by Laura Manning-Hudson, the managing shareholder of our West Palm Beach office, and appears in today’s edition of the newspaper. Laura’s article, which is titled “Florida Legislature Appears Poised to Strengthen State Oversight of Community Associations,” discusses two bipartisan bills filed by several South Florida lawmakers. The new proposals are in response to complaints about the lack of effective oversight and funding for the Florida agency that oversees many matters involving community associations. The article reads:

. . . State Sens. Jennifer Bradley of northeastern Florida and Jason Pizzo of southeastern Broward County have filed the bipartisan Senate Bill 1178, which would expand the oversight and enforcement of the Florida Department of Business and Professional Regulation, the agency that regulates condominium and homeowners associations. It would require the DBPR to conduct random audits of community associations to determine compliance with the website/application process for official records and refer suspected criminal activity to law enforcement agencies, and it would enable its representatives to attend association board meetings. The bill would also require newly elected community association board members to take a standardized course in association law as well as continuing education.

SB 1178 and its companion in the Florida House would also require conflict of interest disclosures from property management firms and their employees. They seek to create stricter penalties for fraudulent voting activities, add to the list of association official records, and allow associations to fulfill their obligations for records requests via postings on their websites.

The Senate bill also changes the reserve requirements for condominium buildings deemed unsafe/uninhabitable by local regulators, and it would allow condo associations to create investment committees and invest reserve funds in a combination of depository accounts.

Sens. Ileana Garcia and Shevrin Jones, whose districts span central and northern Miami-Dade County, have recently filed Senate Bill 426, which also seeks to expand the powers of the DBPR. This bipartisan bill would implement a Condominium Fraud Investigation Pilot Program, which would operate under the Department of Legal Affairs of the Florida Attorney General. The program would be able to contract with private-sector financial fraud investigators, conduct audits and issue subpoenas. Findings of suspected criminal activity would be forwarded to state attorneys’ offices for possible prosecution.

The bill calls for the DBPR to create a searchable online database by July 2026 that includes all Florida condominium communities and enables users to access the contact information for boards of directors and property managers, as well as records such as association declarations, budgets, reserve studies and structural inspection reports. It would also expand the powers and duties of the DBPR’s Condominium Ombudsman, and it would have the agency create a new office of the ombudsman for homeowners associations.

Indeed, the frustrations with the DBPR’s lack of effective oversight and enforcement have been well documented by the Herald in its reports on the legal saga that is continuing to unfold at the Hammocks HOA in Kendall. The Sun Sentinel (www.Sun-Sentinel.com) also recently featured an investigative series on condominium associations and HOAs, and its final article included the following revelations:

“The vast majority of condo owners who ask DBPR for help don’t get it. From 2007 to 2023, DBPR rejected or dismissed more than three-fourths of complaints. Only 16 percent of the cases in that time resulted in enforcement.

The number of condo owners DBPR refused to help has sharply increased over the past 10 years, as the agency rejected a growing number of complaints on the grounds that it lacked the legal authority to intervene.

Even cases that do fall under DBPR’s powers aren’t handled efficiently. The Sun Sentinel analysis shows routine cases — a denial of financial records, for example — can take a year to resolve.

Florida law sets up DBPR and its condo ombudsman’s office as the condo authority, but the state has understaffed and underfunded the agency. The ombudsman position has been vacant since March.

The problem is especially acute in South Florida, home to half the state’s condos and nearly 70 percent of the complaints, according to the Sun Sentinel’s analysis.”. . .

Laura concludes her article by noting that these issues with the DBPR and its oversight of condominium association and HOA matters have been frustrating owners in South Florida and across the state for decades. It appears that lawmakers are poised to address the problems in a meaningful manner in 2024, and she writes that our firm’s attorneys will be encouraging them to make careful and considered choices with adequate funding behind all the measures.

Our firm salutes Laura for sharing her insights into these important potential new laws for Florida communities with the readers of the Miami Herald. Click here to read the complete article in the newspaper’s website.