By Eric Glazer, Esq.

Published February 4, 2013

            If this were a football game, I would say that Jan Bergemann and I helped get you to the red zone.  Our two bills have now been filed and have numbers assigned to them.  IT'S NOW UP TO ALL OF YOU TO CALL YOUR LOCAL SENATOR AND HOUSE MEMBER AND DEMAND THAT THEY VOTE IN FAVOR OF THESE BILLS!

            Our request for changes to the H.O. A. laws were broken down in two different bills.  The first bill is number SB 580.  Here is what it proposes:

1.                  Just like in a condominium, require members of H.O.A. Boards to become certified.  Shouldn't HOA Board members be required to know the law as well?

2.                  Just like in a condominium, the HOA statute would be amended to prohibit officers and directors from receiving any type of kickbacks from vendors who are awarded HOA contracts.

3.                  Just like in a condominium, the HOA statute would be amended to require HOA directors and officers who want to do business with the association to  disclose the relationship, and have two-thirds of the other directors vote in favor of same.

4.                  Just like in a condominium, directors or officers who are arrested for stealing association funds would be removed from the Board pending a determination of their charges.

5.                  Just like in a condominium, the association would be required to purchase insurance or fidelity bonding for all persons who handle association funds.

6.                  Just like in a condominium, access to records would be available within five days.  However, now the association would no longer be allowed to charge personnel fees at an hourly rate to owners who want copies.  Owners would also be allowed to use a cell phone or camera of their own to photocopy the records.

To say that passage of the above bill should be a no brainer, is an understatement.  The provisions are obviously beneficial and already work for condominiums.  No legislator should have a legitimate quarrel with any of the foregoing measures unless they support kickbacks, lack of education, self-dealing, stealing and over charging owners for copies of records.

The second bill, numbered S 596 attempts to do the following

1. Just like in condominiums, HOA's would now be regulated by the Florida Department of Business and Professional Regulation.  All owners would be required to pay $4.00 per year to the Division.  In return, the Division would be able to provide document examiners, answer questions, provide educational materials, investigate wrongdoing, investigate developers and more.

2. All HOA's would be required to utilize the election procedures that condominiums use.  If 20% of eligible voters participate in the election, the election will be valid and no longer would a 30% quorum of unit owners be required to attend the annual meeting in order to have a valid election.  The condo election statute works and the HOA election procedures are woefully inadequate. 

3. Developers of HOA's seem to maintain control of the association forever; sometimes even decades after the community is built.  Our proposed legislation would require turnover of the association to control of the unit owners when development of all of the parcels that will ultimately be operated by the homeowners' association has been completed, some of the parcels have been conveyed to members, and no other parcels are being offered for sale by the developer in the ordinary course of business; When some of the parcels have been conveyed to members and no other parcels are being constructed or offered for sale by the developer in the ordinary course of business; When the developer files a petition seeking protection in bankruptcy; or When a receiver for the developer is appointed by a circuit court and is not discharged within 30 days after such appointment, unless the court determines, within 30 days after appointment of the receiver, that transfer of control would be detrimental to the homeowners' association or its members.  NO MORE LIFETIME DICTATORSHIPS.

No doubt you will hear from some Legislators that this second bill is more difficult for them to pass.  You will hear grumblings about the cost to the State to expand the DBPR to now oversee H.O.A.'s in addition to condominiums.  It's hogwash.  Don't believe it and don't stand for it.  The $4.00 per unit paid by condominium unit owners more than covers the budget for the DBPR.  In fact, despite the fact that this money is technically earmarked for a trust fund, the Florida Legislature has used it time and again for general revenue purposes.  There are far more H.O.A. units than there are condominium units.  Therefore, the State would financially prosper even more if this bill were to pass.  It would be completely funded by the $4.00 per unit each HOA member would pay.  Surveys have shown that HOA members would gladly pay $4.00 per year for the same benefits that condominium owners receive from the Division.  If HOA members want to be regulated and pay for it, why should legislators stand in the way?

By the way…..if anyone can intelligently tell me why condominiums are subject to DBPR regulation but HOA's are not, I'm all ears.  There's a dysfunctional and untruthful way of thinking out there that suggests there's a significant difference between these two types of communities that simply isn't there.  There is just no justification for regulation of one, but not the other.

The H.O.A. statute stinks when it comes to administering elections.  It is far less trustworthy than condominium elections and breeds disinterest.  Adopting the condominium voting system is long overdue.

Finally, there are just too many stories out there of HOA communities being under developer control for decades.  Any statute that even remotely addresses this issue should be passed without a second look.

So here we are…….We drafted the legislation and had it sponsored by representatives in both the House and The Senate.  To be frank, the rest is up to you.  How about each of you do two things?  Respond to this blog below, which I will treat as a petition to The Florida Legislature to pass these two bills.  Then, make the effort to call your local Senator and House member and urge their support.  Both of these things shouldn't take you more than about ten minutes.  Unless of course you're happy with the way things are.