Governor Rick Scott Signs New Legislation for Condominium Associations

Understanding the Impact of the Recent Condominium Bill


On June 26, 2017, Governor Rick Scott enacted a new bill specifically targeting condominium associations. This legislation, known as CS/CS/HB 1237 – Condominium, introduces significant changes that will come into effect on July 1, 2017.

Addressing Conflicts of Interest

One of the main focuses of the bill is to prevent conflicts of interest that may harm condominium unit owners. To achieve this, the legislation defines and restricts activities that can be considered detrimental to the unit owners. Here are some key provisions related to conflicts of interest:

  1. Attorneys are no longer allowed to represent both the board of a condominium association and the management company of the association.
  2. Members of the board or the management company are prohibited from purchasing units in foreclosure sales resulting from the association’s foreclosure of unpaid assessments.
  3. Condominium associations are forbidden from contracting with service providers owned or operated by a board member, or someone who has a financial relationship with a board member or an officer. This also extends to close relatives of board members or officers.
  4. Companies or individuals contracted to provide maintenance or management services to a condominium association, or board members of such companies, are prohibited from owning more than 50 percent of the units or purchasing a property under a lien by the association.
  5. In cases where officers or directors of a condominium board engage in activities that could be deemed a conflict of interest, disclosure is mandatory. If the conflict persists, the officer or director must either cease the activity causing the conflict or withdraw from office. Non-compliance may result in removal from the board.
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Improved Access to Condominium Association Records

The bill also aims to enhance transparency by providing unit owners with easier access to condominium association records. Some of the key changes relating to record-keeping and accessibility include:

  1. Condominium associations must now maintain records of bids for materials, equipment, and services as part of their official records.
  2. Renters are granted the right to inspect and obtain copies of the association’s bylaws and rules.
  3. Condominium associations are required to submit an annual report to the Department of Business and Professional Regulation. This report lists the financial institutions where the association maintains accounts and can be obtained by unit owners from the department.
  4. If an association fails to provide a unit owner with a copy of the most recent financial statement after a request, the unit owner may notify the Division of Condominiums, Timeshares, and Mobile Homes. The division will then inform the association that it must comply with the request. Failure to do so within 5 business days may result in the association being required to prepare more detailed financial statements for 3 years.
  5. In cases where a condominium officer or director faces certain criminal charges related to the condominium, access to association records is prohibited without a court order while the charges are pending.
  6. Condominium associations with 150 or more units must make most of their official records available on their website. However, access to these records must be restricted to the unit owners and not accessible to the general public.

The Impact and Challenges Ahead

The new legislation signifies a concerted effort to address the concerns raised by condo owners in Miami-Dade County. A grand jury report highlighted the need for stronger regulations to prevent self-dealing and other forms of misconduct within condominium associations. Moreover, the report emphasized the importance of timely access to official records for unit owners.

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While the bill endeavors to improve the governance and transparency of condominium associations, it may also pose challenges for associations striving to comply with the heightened standards. Consequently, the number of complaints and cases related to condominium associations is expected to rise, as associations adapt to the new regulations.

For the full details of CS/CS/HB 1237 – Condominium Bill, please refer to the official document.

Remember, with greater transparency and improved governance, the rights and interests of condominium unit owners are better protected.