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BEWARE THE PROBLEMS OF TURN-OVER
By
Jan Bergemann
Published June 22, 2018
Lots of folks are
looking forward to the day when the developer finally turns over
control of the association to the owners. I agree, it’s a day of
celebration – but it requires a lot of work – and new board
members that are willing to do some work – and have minimum a
basic business understanding.
At turn-over the
owners are electing a new board, replacing the board members
appointed by the developer. Owners should make sure that the
newly elected board members are not “close” to the developer,
because they are the ones in charges looking into the
developers’ past actions, the finances, contracts and quality of
work, especially for the common interest property.
The newly elected board really has to do its homework.
Never forget: The
service providers at the time of turn-over have all been picked
by the developer. Some law firms and management companies have
close relations to the developer. The new board may be well
advised to terminate their services because of their close ties
to the developer. The developer will most likely start a new
project elsewhere, and these service–providers are hoping to get
hired for the next developer’s project.
Make sure that the
new board has real help in their fight for “independence.”
We have seen “bad”
contracts between associations (actually the developer) and –
for example – landscaping companies, with outrageous prices.
Remember: Kickbacks are rampant in Florida.
For possible
warranty issues (or buildings defects) it’s great to have a law
firm on your side which is not compromised by a developer
relationship.
Make sure the new
board takes a serious look at the past finances. What was spent
for what purpose? Where the reserve funds properly funded? Were
all maintenance fees properly paid – and in time? Where all the
bills paid really for purposes as intended – as described in “Use
of Fees”?
Money is a hot topic
at turn-over. Remember: A developer is in it for the MONEY.
And even little “tricks” can make the developer lots of money –
at the expense of the homeowners.
So, after finishing
to celebrate the “TURN-OVER” make sure the new
board is willing to do a lot of work. IT’S IMPORTANT!
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Jan Bergemann is president of Cyber Citizens For Justice,
Florida
's largest state-wide property owners' advocacy group.
CCFJ works on legislation to help owners living in
community
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associations. He moved to
Florida
in 1995 - hoping to retire. He moved into a HOA, where the
developer cheated the homeowners and used the association dues
for his own purposes. End of retirement!
CCFJ was born in the year 2000, when some owners met in
Tallahassee
- finding out that power is only in numbers. Bergemann was a
member of Governor Jeb Bush's HOA Task force in 2003/2004.
The organization has two websites to inform interested
Florida
homeowners and condo owners:
News Website: http://www.ccfj.net/.
Educational Website: http://www.ccfjfoundation.net/.
We think that only owners can really represent owners, since all
service providers surely have a different interest! We are
trying to create owner-friendly laws, but the best laws are
useless without enforcement. And enforcement is totally lacking
in
Florida
!
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