Changes to Florida Condominium Law Include New Limits, Obligations, and Criminal Penalties for Board Members
Community association board members in Florida have many legal and fiduciary obligations to the association and property owners. There are also corresponding consequences when those obligations are not met or a board member engages in misconduct. But now there are even more responsibilities and potential civil and criminal liability under a new law recently signed by Florida Gov. Rick Scott.
The new law, which consists of amendments to Chapter 718 of the Florida Statutes, became effective July 1. It was written and passed unanimously in both houses of the state legislature in response to highly-publicized incidents of fraud and abuse by condominium board members in South Florida. Specifically, a “Condo Nightmares” series by el Nuevo Herald and Univisión 23 highlighted cases of electoral fraud, forged signatures on ballots, conflicts of interests, misappropriation of funds and rigged bids. These reports ultimately led a Miami-Dade grand jury to recommend changes to the law regulating condos as well as reforms to the state Department of Business and Professional Regulation (DBPR) which regulates condominium associations.
Key Aspects of New Condo Law
The changes contained in the new law will require changes in the ways condo boards conduct business, limit how and for how long board members can serve, and impose greater sanctions for certain types of misconduct. Specifically:
- Condominium associations with 150 or more units will need to publish financial reports on a password-protected web page accessible to all residents. If it’s proven that documents were denied to owners in order to hide fraud, those responsible could face felony charges under a provision that takes effect in July 2018.
- Directors will be limited to eight years on the board of condominium’ associations, however, they can remain in office if they receive two-thirds of the votes from owners in subsequent elections.
- In an effort to prevent nepotism or inside dealing, directors are now barred from receiving payments from the association or hiring their relatives. Currently, directors can be paid for services such as cleaning, painting, and repairs if all other directors are informed of the arrangement.
- Officers, directors, or managers of a condominium association are prohibited from soliciting, offering to accept, or accepting a kickback for which consideration has not been provided.
- An association is prohibited from hiring an attorney who represents the management company of the association.
- To minimize the chances of election fraud, the following actions now constitute criminal offenses that could lead to imprisonment upon conviction:
- the falsification of signatures on ballots for board elections
- theft of ballots and
- the disappearance of votes
- debit cards
If you have questions about these changes to the law and how they may impact your Northwest Florida condominium association, we can help. Moorhead Real Estate Law Group provides seasoned representation for all forms of common ownership property throughout northwest Florida. This includes condominium associations, cooperative associations, commercial condominium associations, mobile park associations, and homeowners’ association attorneys.