Bill Text: FL S1742 | 2025 | Regular Session | Introduced
Bill Title: Condominium and Cooperative Associations
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced) 2025-02-28 - Filed [S1742 Detail]
Download: Florida-2025-S1742-Introduced.html
Florida Senate - 2025 SB 1742
By Senator Bradley
6-01297A-25 20251742__
1 A bill to be entitled
2 An act relating to condominium and cooperative
3 associations; amending s. 718.111, F.S.; revising the
4 methods of delivery for a copy of the most recent
5 association financial report to include electronic
6 delivery via the Internet; requiring a board to use
7 best efforts to make prudent investment decisions in
8 fulfilling its duty to manage operating and reserve
9 funds of the association; authorizing an association,
10 including a multicondominium association, to invest
11 reserve funds in specified financial institutions;
12 providing restrictions; prohibiting any funds not
13 identified as reserve funds from being used for
14 investments; requiring a board to create an investment
15 committee composed of a specified minimum number of
16 board members; requiring the board to adopt rules;
17 requiring that all meetings of the investment
18 committee be recorded and made part of the official
19 records of the association; requiring that the
20 investment policy statement developed pursuant to
21 certain provisions address specified issues; requiring
22 the investment committee to recommend investment
23 advisers to the board; requiring the board to select
24 one of the recommended investment advisers to provide
25 services to the association; requiring such advisers
26 to be registered; prohibiting an investment adviser
27 from being related to any board member, community
28 management company reserve study provider, or unit
29 owner; requiring investment advisers to comply with
30 the prudent investor rule; requiring an adviser to act
31 as a fiduciary to the association; requiring that the
32 investment and fiduciary standards of this section
33 take precedence over any conflicting law; requiring
34 the investment committee to recommend a replacement
35 adviser if the committee determines that an investment
36 adviser is not meeting requirements; requiring the
37 association to provide the investment adviser with
38 specified financial information at least once each
39 calendar year, or sooner if a substantial financial
40 obligation of the association becomes known to the
41 board; requiring the investment adviser to annually
42 review such financial information and provide the
43 association with a portfolio allocation model that is
44 suitably structured and prudently designed to match
45 projected annual reserve fund requirements and
46 liability, assets, and liquidity requirements;
47 requiring the investment adviser to prepare a funding
48 projection for each reserve component, including any
49 of the component’s redundancies; requiring that a
50 specified minimum timeframe of projected reserves in
51 cash or cash equivalents be available to the
52 association; authorizing a portfolio managed by an
53 investment adviser to contain any type of investment
54 necessary to meet the objectives in the investment
55 policy statement; providing exceptions; requiring that
56 any funds invested by the investment adviser be held
57 by third-party custodial accounts that are subject to
58 insurance coverage by the Securities Investor
59 Protection Corporation in an amount equal to or
60 greater than the invested amount; authorizing the
61 investment adviser to withdraw investment fees,
62 expenses, and commissions from invested funds;
63 requiring the investment adviser to annually provide
64 the association with a written certification of
65 compliance of this section and provide the association
66 with a list of stocks, securities, and other
67 obligations; requiring the investment adviser to
68 submit monthly, quarterly, and annual reports to the
69 association prepared in accordance with established
70 financial industry standards; requiring that any
71 principal, earnings, or interest managed be available
72 to the association at no cost within a specified
73 timeframe after the association’s written or
74 electronic request; requiring that unallocated income
75 earned on reserve fund investments be spent only on
76 specified expenditures; reenacting and amending s.
77 718.112, F.S.; authorizing a unit-owner-controlled
78 association to obtain a line of credit in lieu of
79 maintaining reserves for budgets adopted on or before
80 a specified date upon a majority vote of the
81 association; requiring that such line of credit be
82 sufficient to meet the association’s deferred
83 maintenance obligations not funded in the
84 association’s reserve account for each budget;
85 requiring that funding from the line of credit be
86 immediately available for access by the board for a
87 specified purpose; requiring that such lines of credit
88 be included in the association’s financial report;
89 deleting a requirement that the majority of the
90 members must approve of the board pausing
91 contributions to the association’s reserves for a
92 specified purpose; authorizing the board to
93 temporarily pause reserve fund contributions or reduce
94 the amount of reserve funding for a specified purpose
95 for a budget adopted on or before a specified date if
96 the association has completed a milestone inspection
97 within a specified timeframe and such inspection
98 recommended certain repairs; requiring that such
99 temporary pause or reduction be approved by a majority
100 of the total voting interests of the association;
101 providing applicability; requiring associations that
102 have paused or reduced their reserve funding to have a
103 structural integrity reserve study performed before
104 the continuation of reserve contributions for
105 specified purposes; providing that a vote of the
106 members is not required for the board to change the
107 accounting method for reserves to specified accounting
108 methods; requiring specified design professionals or
109 contractors who bid to perform a structural integrity
110 reserve study to disclose in writing to the
111 association their intent to bid on any services
112 related to the maintenance, repair, or replacement
113 that may be recommended by the structural integrity
114 reserve study; prohibiting such professionals or
115 contractors from having any interest in or being
116 related to any person having any interest in the firm
117 or entity providing the association’s structural
118 integrity reserve study unless such relationship is
119 disclosed in writing; defining the term “relative”;
120 providing that a contract for services is voidable and
121 terminates upon the association filing a written
122 notice terminating such a contract if such
123 professional or contractor fails to provide a written
124 disclosure of such relationship with the firm
125 conducting the structural integrity reserve study;
126 providing that such professional or contractor may be
127 subject to discipline for his or her failure to
128 provide such written disclosure; requiring that a
129 structural integrity reserve study include a
130 recommendation for a reserve funding schedule based on
131 specified criteria; authorizing the study to recommend
132 other types of reserve funding schedules, provided
133 each recommended schedule is sufficient to meet the
134 association’s maintenance needs; requiring that
135 reserves not required for certain items be separately
136 identified in the structural integrity reserve study
137 as such; authorizing an association to delay a
138 required structural integrity reserve study for a
139 specified timeframe if it has completed a milestone
140 inspection or similar inspection, for a specified
141 purpose; requiring the Division of Florida
142 Condominiums, Timeshares, and Mobile Homes to adopt
143 rules for the form for the structural integrity
144 reserve study in coordination with the Florida
145 Building Commission; making technical changes;
146 amending s. 718.503, F.S.; revising the disclosures
147 that must be included in a contract for the sale and
148 resale of a residential unit; amending s. 8 of chapter
149 2024-244, Laws of Florida, as amended; revising the
150 requirement of an association managing 25 or more
151 units, rather than 150 or more units, to post digital
152 copies of specified documents on its website or make
153 such documents available through an application that
154 can be downloaded on a mobile device; revising such
155 documents to include the minutes of all meetings of
156 the association, the board of administration, and the
157 unit owners over the preceding 12 months; deleting
158 obsolete language; amending s. 31 of chapter 2024-244
159 Laws of Florida; revising applicability; amending s.
160 719.104, F.S.; requiring a board to use best efforts
161 to make prudent investment decisions in fulfilling its
162 duty to manage operating and reserve funds of the
163 association; authorizing an association to invest
164 reserve funds in specified financial institutions;
165 providing restrictions; prohibiting any funds not
166 identified as reserve funds from being used for
167 investments; requiring a board to create an investment
168 committee composed of a specified minimum number of
169 board members; requiring the board to adopt rules;
170 requiring that all meetings of the investment
171 committee be recorded and made part of the official
172 records of the association; requiring that the
173 investment policy statement developed pursuant to
174 certain provisions address specified issues; requiring
175 the investment committee to recommend investment
176 advisers to the board; requiring the board to select
177 one of the recommended investment advisers to provide
178 services to the association; requiring such advisers
179 to be registered; prohibiting an investment adviser
180 from being related to any board member, community
181 management company reserve study provider, or unit
182 owner; requiring investment advisers to comply with
183 the prudent investor rule; requiring an adviser to act
184 as a fiduciary to the association; requiring that the
185 investment and fiduciary standards of this section
186 take precedence over any conflicting law; requiring
187 the investment committee to recommend a replacement
188 adviser if the committee determines that an investment
189 adviser is not meeting requirements; requiring the
190 association to provide the investment adviser with
191 specified financial information at least once each
192 calendar year, or sooner if a substantial financial
193 obligation of the association becomes known to the
194 board; requiring the investment adviser to annually
195 review such financial information and provide the
196 association with a portfolio allocation model that is
197 suitably structured and prudently designed to match
198 projected annual reserve fund requirements and
199 liability, assets, and liquidity requirements;
200 requiring the investment adviser to prepare a funding
201 projection for each reserve component, including any
202 of the component’s redundancies; requiring that a
203 minimum timeframe of projected reserves in cash or
204 cash equivalents be available to the association;
205 authorizing a portfolio managed by an investment
206 adviser to contain any type of investment necessary to
207 meet the objectives in the investment policy
208 statement; providing exceptions; requiring that any
209 funds invested by the investment adviser be held in
210 third-party custodial accounts that are subject to
211 insurance coverage by the Securities Investor
212 Protection Corporation in an amount equal to or
213 greater than the invested amount; authorizing the
214 investment adviser to withdraw investment fees,
215 expenses, and commissions from invested funds;
216 requiring the investment adviser to annually provide
217 the association with a written certification of
218 compliance of this section and provide the association
219 with a list of stocks, securities, and other
220 obligations; requiring the investment adviser to
221 submit monthly, quarterly, and annual reports to the
222 association prepared in accordance with established
223 financial industry standards; requiring that any
224 principal, earnings, or interest managed be available
225 to the association at no cost within a specified
226 timeframe after the association’s written or
227 electronic request; requiring that unallocated income
228 earned on reserve fund investments be spent only on
229 specified expenditures; amending s. 719.106, F.S.;
230 authorizing the board to pause contributions to its
231 reserves or reduce reserve funding if a local building
232 official determines the entire condominium building is
233 uninhabitable due to a natural emergency; authorizing
234 any reserve account fund held by the association to be
235 expended to make the condominium building and its
236 structures habitable, pursuant to the board’s
237 determination; requiring the association to
238 immediately resume contributing funds to its reserves
239 once the local building official determines that the
240 condominium building is habitable; authorizing a unit
241 owner-controlled association to obtain a line of
242 credit in lieu of maintaining reserves for budgets
243 adopted on or before a specified date upon a majority
244 vote of the association; requiring that such line of
245 credit be sufficient to meet the association’s
246 deferred maintenance obligations not funded in the
247 association’s reserve account for each budget;
248 requiring that funding from the line of credit be
249 immediately available for access by the board for a
250 specified purpose; authorizing the board to
251 temporarily pause reserve fund contributions or reduce
252 the amount of reserve funding for a specified purpose
253 for a budget adopted on or before a specified date if
254 the association has completed a milestone inspection
255 within a specified timeframe; requiring that such
256 temporary pause or reduction be approved by a majority
257 of the total voting interests of the association;
258 providing applicability; requiring associations that
259 have paused or reduced their reserve funding to have a
260 structural integrity reserve study performed before
261 the continuation of reserve contributions for
262 specified purposes; providing that a vote of the
263 members is not required for the board to change the
264 accounting method for reserves to specified accounting
265 methods; requiring specified design professionals or
266 contractors who bid to perform a structural integrity
267 reserve study to disclose in writing to the
268 association their intent to bid on any services
269 related to the maintenance, repair, or replacement
270 that may be recommended by the structural integrity
271 reserve study; prohibiting such professionals or
272 contractors from having any interest in or being
273 related to any person having any interest in the firm
274 or entity providing the association’s structural
275 integrity reserve study unless such relationship is
276 disclosed in writing; defining the term “relative”;
277 providing that a contract for services is voidable and
278 terminates upon the association filing a written
279 notice terminating such a contract if such
280 professional or contractor fails to provide a written
281 disclosure of such relationship with the firm
282 conducting the structural integrity reserve study;
283 providing that such professional or contractor may be
284 subject to discipline for his or her failure to
285 provide such written disclosure; requiring that a
286 structural integrity reserve study include a
287 recommendation for a reserve funding schedule based on
288 specified criteria; authorizing the study to recommend
289 other types of reserve funding schedules, provided
290 each recommended schedule is sufficient to meet the
291 association’s maintenance needs; requiring that
292 reserves not required for certain items be separately
293 identified in the structural integrity reserve study
294 as such; authorizing an association to delay a
295 required structural integrity reserve study for a
296 specified timeframe if it has completed a milestone
297 inspection or similar inspection, for a specified
298 purpose; requiring the division to adopt, by rule, the
299 form for the structural integrity reserve study in
300 coordination with the Florida Building Commission;
301 amending s. 719.503, F.S.; revising the disclosures
302 that must be included in a contract for the sale and
303 resale of an interest in a cooperative; reenacting s.
304 721.13(3)(e), F.S., relating to management, to
305 incorporate the amendment made to s. 718.111, F.S., in
306 a reference thereto; reenacting ss. 718.504(7)(a) and
307 (21)(c), and 718.618(1)(d), F.S., relating to
308 prospectus or offering circulars; and converter
309 reserve accounts and warranties, respectively, to
310 incorporate the amendment made to s. 718.112, F.S., in
311 references thereto; reenacting s. 718.501(1)(a) and
312 (v), F.S., relating to the authority, responsibility,
313 and duties of the Division of Florida Condominiums,
314 Timeshares, and Mobile Homes, to incorporate the
315 amendments made to ss. 718.111 and 718.112, F.S., in
316 references thereto; reenacting s. 718.706(1) and (3),
317 F.S., relating to specific provisions pertaining to
318 offering of units by bulk assignees or bulk buyers, to
319 incorporate the amendments made to ss. 718.111,
320 718.112, and 718.503, F.S., in references thereto;
321 reenacting ss. 719.103(24), 719.501(1), and
322 719.504(7)(a) and (20)(c), F.S., relating to
323 definitions; powers and duties of the Division of
324 Florida Condominiums, Timeshares, and Mobile Homes;
325 and prospectus or offering circulars, respectively, to
326 incorporate the amendment made to s. 719.106, F.S., in
327 references thereto; providing an effective date.
328
329 Be It Enacted by the Legislature of the State of Florida:
330
331 Section 1. Subsection (13) of section 718.111, Florida
332 Statutes, is amended, subsection (16) is added to that section,
333 and paragraph (g) of subsection (12) of that section is
334 reenacted, to read:
335 718.111 The association.—
336 (12) OFFICIAL RECORDS.—
337 (g)1. By January 1, 2019, an association managing a
338 condominium with 150 or more units which does not contain
339 timeshare units shall post digital copies of the documents
340 specified in subparagraph 2. on its website or make such
341 documents available through an application that can be
342 downloaded on a mobile device.
343 a. The association’s website or application must be:
344 (I) An independent website, application, or web portal
345 wholly owned and operated by the association; or
346 (II) A website, application, or web portal operated by a
347 third-party provider with whom the association owns, leases,
348 rents, or otherwise obtains the right to operate a web page,
349 subpage, web portal, collection of subpages or web portals, or
350 an application which is dedicated to the association’s
351 activities and on which required notices, records, and documents
352 may be posted or made available by the association.
353 b. The association’s website or application must be
354 accessible through the Internet and must contain a subpage, web
355 portal, or other protected electronic location that is
356 inaccessible to the general public and accessible only to unit
357 owners and employees of the association.
358 c. Upon a unit owner’s written request, the association
359 must provide the unit owner with a username and password and
360 access to the protected sections of the association’s website or
361 application which contain any notices, records, or documents
362 that must be electronically provided.
363 2. A current copy of the following documents must be posted
364 in digital format on the association’s website or application:
365 a. The recorded declaration of condominium of each
366 condominium operated by the association and each amendment to
367 each declaration.
368 b. The recorded bylaws of the association and each
369 amendment to the bylaws.
370 c. The articles of incorporation of the association, or
371 other documents creating the association, and each amendment to
372 the articles of incorporation or other documents. The copy
373 posted pursuant to this sub-subparagraph must be a copy of the
374 articles of incorporation filed with the Department of State.
375 d. The rules of the association.
376 e. A list of all executory contracts or documents to which
377 the association is a party or under which the association or the
378 unit owners have an obligation or responsibility and, after
379 bidding for the related materials, equipment, or services has
380 closed, a list of bids received by the association within the
381 past year. Summaries of bids for materials, equipment, or
382 services which exceed $500 must be maintained on the website or
383 application for 1 year. In lieu of summaries, complete copies of
384 the bids may be posted.
385 f. The annual budget required by s. 718.112(2)(f) and any
386 proposed budget to be considered at the annual meeting.
387 g. The financial report required by subsection (13) and any
388 monthly income or expense statement to be considered at a
389 meeting.
390 h. The certification of each director required by s.
391 718.112(2)(d)4.b.
392 i. All contracts or transactions between the association
393 and any director, officer, corporation, firm, or association
394 that is not an affiliated condominium association or any other
395 entity in which an association director is also a director or
396 officer and financially interested.
397 j. Any contract or document regarding a conflict of
398 interest or possible conflict of interest as provided in ss.
399 468.4335, 468.436(2)(b)6., and 718.3027(3).
400 k. The notice of any unit owner meeting and the agenda for
401 the meeting, as required by s. 718.112(2)(d)3., no later than 14
402 days before the meeting. The notice must be posted in plain view
403 on the front page of the website or application, or on a
404 separate subpage of the website or application labeled “Notices”
405 which is conspicuously visible and linked from the front page.
406 The association must also post on its website or application any
407 document to be considered and voted on by the owners during the
408 meeting or any document listed on the agenda at least 7 days
409 before the meeting at which the document or the information
410 within the document will be considered.
411 l. Notice of any board meeting, the agenda, and any other
412 document required for the meeting as required by s.
413 718.112(2)(c), which must be posted no later than the date
414 required for notice under s. 718.112(2)(c).
415 m. The inspection reports described in ss. 553.899 and
416 718.301(4)(p) and any other inspection report relating to a
417 structural or life safety inspection of condominium property.
418 n. The association’s most recent structural integrity
419 reserve study, if applicable.
420 o. Copies of all building permits issued for ongoing or
421 planned construction.
422 3. The association shall ensure that the information and
423 records described in paragraph (c), which are not allowed to be
424 accessible to unit owners, are not posted on the association’s
425 website or application. If protected information or information
426 restricted from being accessible to unit owners is included in
427 documents that are required to be posted on the association’s
428 website or application, the association shall ensure the
429 information is redacted before posting the documents.
430 Notwithstanding the foregoing, the association or its agent is
431 not liable for disclosing information that is protected or
432 restricted under this paragraph unless such disclosure was made
433 with a knowing or intentional disregard of the protected or
434 restricted nature of such information.
435 4. The failure of the association to post information
436 required under subparagraph 2. is not in and of itself
437 sufficient to invalidate any action or decision of the
438 association’s board or its committees.
439 (13) FINANCIAL REPORTING.—Within 90 days after the end of
440 the fiscal year, or annually on a date provided in the bylaws,
441 the association shall prepare and complete, or contract for the
442 preparation and completion of, a financial report for the
443 preceding fiscal year. Within 21 days after the final financial
444 report is completed by the association or received from the
445 third party, but not later than 120 days after the end of the
446 fiscal year or other date as provided in the bylaws, the
447 association shall deliver to each unit owner by United States
448 mail or personal delivery at the mailing address, property
449 address, e-mail address, or facsimile number provided to fulfill
450 the association’s notice requirements, a copy of the most recent
451 financial report, and a notice that a copy of the most recent
452 financial report will be, as requested by the owner, mailed, or
453 hand delivered, or electronically delivered via the Internet to
454 the unit owner, without charge, within 5 business days after
455 receipt of a written request from the unit owner. The division
456 shall adopt rules setting forth uniform accounting principles
457 and standards to be used by all associations and addressing the
458 financial reporting requirements for multicondominium
459 associations. The rules must include, but not be limited to,
460 standards for presenting a summary of association reserves,
461 including a good faith estimate disclosing the annual amount of
462 reserve funds that would be necessary for the association to
463 fully fund reserves for each reserve item based on the straight
464 line accounting method. This disclosure is not applicable to
465 reserves funded via the pooling method. In adopting such rules,
466 the division shall consider the number of members and annual
467 revenues of an association. Financial reports shall be prepared
468 as follows:
469 (a) An association that meets the criteria of this
470 paragraph shall prepare a complete set of financial statements
471 in accordance with generally accepted accounting principles. The
472 financial statements must be based upon the association’s total
473 annual revenues, as follows:
474 1. An association with total annual revenues of $150,000 or
475 more, but less than $300,000, shall prepare compiled financial
476 statements.
477 2. An association with total annual revenues of at least
478 $300,000, but less than $500,000, shall prepare reviewed
479 financial statements.
480 3. An association with total annual revenues of $500,000 or
481 more shall prepare audited financial statements.
482 (b)1. An association with total annual revenues of less
483 than $150,000 shall prepare a report of cash receipts and
484 expenditures.
485 2. A report of cash receipts and disbursements must
486 disclose the amount of receipts by accounts and receipt
487 classifications and the amount of expenses by accounts and
488 expense classifications, including, but not limited to, the
489 following, as applicable: costs for security, professional and
490 management fees and expenses, taxes, costs for recreation
491 facilities, expenses for refuse collection and utility services,
492 expenses for lawn care, costs for building maintenance and
493 repair, insurance costs, administration and salary expenses, and
494 reserves accumulated and expended for capital expenditures,
495 deferred maintenance, and any other category for which the
496 association maintains reserves.
497 (c) An association may prepare, without a meeting of or
498 approval by the unit owners:
499 1. Compiled, reviewed, or audited financial statements, if
500 the association is required to prepare a report of cash receipts
501 and expenditures;
502 2. Reviewed or audited financial statements, if the
503 association is required to prepare compiled financial
504 statements; or
505 3. Audited financial statements if the association is
506 required to prepare reviewed financial statements.
507 (d) If approved by a majority of the voting interests
508 present at a properly called meeting of the association, an
509 association may prepare:
510 1. A report of cash receipts and expenditures in lieu of a
511 compiled, reviewed, or audited financial statement;
512 2. A report of cash receipts and expenditures or a compiled
513 financial statement in lieu of a reviewed or audited financial
514 statement; or
515 3. A report of cash receipts and expenditures, a compiled
516 financial statement, or a reviewed financial statement in lieu
517 of an audited financial statement.
518
519 Such meeting and approval must occur before the end of the
520 fiscal year and is effective only for the fiscal year in which
521 the vote is taken. An association may not prepare a financial
522 report pursuant to this paragraph for consecutive fiscal years.
523 If the developer has not turned over control of the association,
524 all unit owners, including the developer, may vote on issues
525 related to the preparation of the association’s financial
526 reports, from the date of incorporation of the association
527 through the end of the second fiscal year after the fiscal year
528 in which the certificate of a surveyor and mapper is recorded
529 pursuant to s. 718.104(4)(e) or an instrument that transfers
530 title to a unit in the condominium which is not accompanied by a
531 recorded assignment of developer rights in favor of the grantee
532 of such unit is recorded, whichever occurs first. Thereafter,
533 all unit owners except the developer may vote on such issues
534 until control is turned over to the association by the
535 developer. Any audit or review prepared under this section shall
536 be paid for by the developer if done before turnover of control
537 of the association.
538 (e) A unit owner may provide written notice to the division
539 of the association’s failure to mail or hand deliver him or her
540 a copy of the most recent financial report within 5 business
541 days after he or she submitted a written request to the
542 association for a copy of such report. If the division
543 determines that the association failed to mail or hand deliver a
544 copy of the most recent financial report to the unit owner, the
545 division shall provide written notice to the association that
546 the association must mail or hand deliver a copy of the most
547 recent financial report to the unit owner and the division
548 within 5 business days after it receives such notice from the
549 division. An association that fails to comply with the
550 division’s request may not waive the financial reporting
551 requirement provided in paragraph (d) for the fiscal year in
552 which the unit owner’s request was made and the following fiscal
553 year. A financial report received by the division pursuant to
554 this paragraph shall be maintained, and the division shall
555 provide a copy of such report to an association member upon his
556 or her request.
557 (16) INVESTMENT OF ASSOCIATION FUNDS.—
558 (a) A board shall, in fulfilling its duty to manage
559 operating and reserve funds of an association, use best efforts
560 to make prudent investment decisions that carefully consider
561 risk and return in an effort to maximize returns on invested
562 funds.
563 (b) An association, including a multicondominium
564 association, may invest reserve funds in one or any combination
565 of depository accounts at a community bank, savings bank,
566 commercial bank, savings and loan association, or credit union
567 if the respective account balance at any institution does not
568 exceed the amount of deposit insurance per account provided by
569 any agency of the Federal Government or as otherwise available.
570 Notwithstanding any declaration, only funds identified as
571 reserve funds may be invested pursuant to this subsection.
572 (c) The board shall create an investment committee composed
573 of at least two board members and two-unit unit owners who are
574 not board members. The board shall also adopt rules for invested
575 funds, including, but not limited to, rules requiring periodic
576 reviews of any investment manager’s performance, the development
577 of an investment policy statement, and that all meetings of the
578 investment committee be recorded and made part of the official
579 records of the association. The investment policy statement
580 developed pursuant to this paragraph must, at a minimum, address
581 risk, liquidity, and benchmark measurements; authorized classes
582 of investments; authorized investment mixes; limitations on
583 authority relating to investment transactions; requirements for
584 projected reserve expenditures within, at minimum, the next 24
585 months to be held in cash or cash equivalents; projected
586 expenditures relating to a mandatory structural inspection
587 performed pursuant to s. 553.899; and protocols for proxy
588 response.
589 (d) The investment committee shall recommend investment
590 advisers to the board, and the board shall select one of the
591 recommended investment advisers to provide services to the
592 association. Such investment advisers must be registered or have
593 notice filed under s. 517.12. The selected investment adviser
594 and any representative or association of the investment adviser
595 may not be related by affinity or consanguinity to, or under
596 common ownership with, any board member, community management
597 company, reserve study provider, or unit owner. The investment
598 adviser shall comply with the prudent investor rule in s.
599 518.11. The investment adviser shall act as a fiduciary to the
600 association in compliance with the standards set forth in the
601 Employee Retirement Income Security Act of 1974 at 29 U.S.C. s.
602 1104(a)(1)(A)-(C). In case of conflict with other laws
603 authorizing investments, the investment and fiduciary standards
604 set forth in this subsection must prevail. If at any time the
605 investment committee determines that an investment adviser does
606 not meet the requirements of this section, the investment
607 committee must recommend a replacement investment adviser to the
608 board.
609 (e) At least once each calendar year, or sooner if a
610 substantial financial obligation of the association becomes
611 known to the board, the association must provide the investment
612 adviser with the association’s investment policy statement, the
613 most recent reserve study report, the association’s structural
614 integrity report, and the financial reports prepared pursuant to
615 subsection (13). If there is no recent reserve study report, the
616 association must provide the investment adviser with a good
617 faith estimate disclosing the annual amount of reserve funds
618 necessary for the association to fund reserves fully for the
619 life of each reserve component and each component’s
620 redundancies. The investment adviser shall annually review these
621 documents and provide the association with a portfolio
622 allocation model that is suitably structured and prudently
623 designed to match projected annual reserve fund requirements and
624 liability, assets, and liquidity requirements. The investment
625 adviser shall prepare a funding projection for each reserve
626 component, including any of the component’s redundancies. The
627 association must have available at all times a minimum of 24
628 months of projected reserves in cash or cash equivalents.
629 (f) Portfolios managed by the investment adviser may
630 contain any type of investment necessary to meet the objectives
631 in the investment policy statement; however, portfolios may not
632 contain stocks, securities, or other obligations that the State
633 Board of Administration is prohibited from investing in under s.
634 215.471, s. 215.4725, or s. 215.473 or that state agencies are
635 prohibited from investing in under s. 215.472, as determined by
636 the investment adviser. Any funds invested by the investment
637 adviser must be held in third-party custodial accounts that are
638 subject to insurance coverage by the Securities Investor
639 Protection Corporation in an amount equal to or greater than the
640 invested amount. The investment adviser may withdraw investment
641 fees, expenses, and commissions from invested funds.
642 (g) The investment adviser shall:
643 1. Annually provide the association with a written
644 certification of compliance with this section and a list of
645 stocks, securities, and other obligations that are prohibited
646 from being in association portfolios under paragraph (f); and
647 2. Submit monthly, quarterly, and annual reports to the
648 association which are prepared in accordance with established
649 financial industry standards and in accordance with chapter 517.
650 (h) Any principal, earnings, or interest managed under this
651 subsection must be available at no cost or charge to the
652 association within 15 business days after delivery of the
653 association’s written or electronic request.
654 (i) Unallocated income earned on reserve fund investments
655 must be spent only on capital expenditures, planned maintenance,
656 structural repairs, or other items for which the reserve
657 accounts have been established. Any surplus of funds which
658 exceeds the amount required to maintain reasonably funded
659 reserves must be managed pursuant to s. 718.115.
660 Section 2. Paragraphs (f) and (g) of subsection (2) of
661 section 718.112, Florida Statutes, are amended, and paragraph
662 (b) of that subsection is reenacted, to read:
663 718.112 Bylaws.—
664 (2) REQUIRED PROVISIONS.—The bylaws shall provide for the
665 following and, if they do not do so, shall be deemed to include
666 the following:
667 (b) Quorum; voting requirements; proxies.—
668 1. Unless a lower number is provided in the bylaws, the
669 percentage of voting interests required to constitute a quorum
670 at a meeting of the members is a majority of the voting
671 interests. Unless otherwise provided in this chapter or in the
672 declaration, articles of incorporation, or bylaws, and except as
673 provided in subparagraph (d)4., decisions shall be made by a
674 majority of the voting interests represented at a meeting at
675 which a quorum is present.
676 2. Except as specifically otherwise provided herein, unit
677 owners in a residential condominium may not vote by general
678 proxy, but may vote by limited proxies substantially conforming
679 to a limited proxy form adopted by the division. A voting
680 interest or consent right allocated to a unit owned by the
681 association may not be exercised or considered for any purpose,
682 whether for a quorum, an election, or otherwise. Limited proxies
683 and general proxies may be used to establish a quorum. Limited
684 proxies shall be used for votes taken to waive or reduce
685 reserves in accordance with subparagraph (f)2.; for votes taken
686 to waive the financial reporting requirements of s. 718.111(13);
687 for votes taken to amend the declaration pursuant to s. 718.110;
688 for votes taken to amend the articles of incorporation or bylaws
689 pursuant to this section; and for any other matter for which
690 this chapter requires or permits a vote of the unit owners.
691 Except as provided in paragraph (d), a proxy, limited or
692 general, may not be used in the election of board members in a
693 residential condominium. General proxies may be used for other
694 matters for which limited proxies are not required, and may be
695 used in voting for nonsubstantive changes to items for which a
696 limited proxy is required and given. Notwithstanding this
697 subparagraph, unit owners may vote in person at unit owner
698 meetings. This subparagraph does not limit the use of general
699 proxies or require the use of limited proxies for any agenda
700 item or election at any meeting of a timeshare condominium
701 association or a nonresidential condominium association.
702 3. A proxy given is effective only for the specific meeting
703 for which originally given and any lawfully adjourned meetings
704 thereof. A proxy is not valid longer than 90 days after the date
705 of the first meeting for which it was given. Each proxy is
706 revocable at any time at the pleasure of the unit owner
707 executing it.
708 4. A member of the board of administration or a committee
709 may submit in writing his or her agreement or disagreement with
710 any action taken at a meeting that the member did not attend.
711 This agreement or disagreement may not be used as a vote for or
712 against the action taken or to create a quorum.
713 5. A board or committee member’s participation in a meeting
714 via telephone, real-time videoconferencing, or similar real-time
715 electronic or video communication counts toward a quorum, and
716 such member may vote as if physically present. A speaker must be
717 used so that the conversation of such members may be heard by
718 the board or committee members attending in person as well as by
719 any unit owners present at a meeting.
720 (f) Annual budget.—
721 1. The proposed annual budget of estimated revenues and
722 expenses must be detailed and must show the amounts budgeted by
723 accounts and expense classifications, including, at a minimum,
724 any applicable expenses listed in s. 718.504(21). The board
725 shall adopt the annual budget at least 14 days before the start
726 of the association’s fiscal year. In the event that the board
727 fails to timely adopt the annual budget a second time, it is
728 deemed a minor violation and the prior year’s budget shall
729 continue in effect until a new budget is adopted. A
730 multicondominium association must adopt a separate budget of
731 common expenses for each condominium the association operates
732 and must adopt a separate budget of common expenses for the
733 association. In addition, if the association maintains limited
734 common elements with the cost to be shared only by those
735 entitled to use the limited common elements as provided for in
736 s. 718.113(1), the budget or a schedule attached to it must show
737 the amount budgeted for this maintenance. If, after turnover of
738 control of the association to the unit owners, any of the
739 expenses listed in s. 718.504(21) are not applicable, they do
740 not need to be listed.
741 2.a. In addition to annual operating expenses, the budget
742 must include reserve accounts for capital expenditures and
743 deferred maintenance. These accounts must include, but are not
744 limited to, roof replacement, building painting, and pavement
745 resurfacing, regardless of the amount of deferred maintenance
746 expense or replacement cost, and any other item that has a
747 deferred maintenance expense or replacement cost that exceeds
748 $10,000. The amount to be reserved must be computed using a
749 formula based upon estimated remaining useful life and estimated
750 replacement cost or deferred maintenance expense of the reserve
751 item. In a budget adopted by an association that is required to
752 obtain a structural integrity reserve study, reserves must be
753 maintained for the items identified in paragraph (g) for which
754 the association is responsible pursuant to the declaration of
755 condominium, and the reserve amount for such items must be based
756 on the findings and recommendations of the association’s most
757 recent structural integrity reserve study. With respect to items
758 for which an estimate of useful life is not readily
759 ascertainable or with an estimated remaining useful life of
760 greater than 25 years, an association is not required to reserve
761 replacement costs for such items, but an association must
762 reserve the amount of deferred maintenance expense, if any,
763 which is recommended by the structural integrity reserve study
764 for such items. The association may adjust replacement reserve
765 assessments annually to take into account an inflation
766 adjustment and any changes in estimates or extension of the
767 useful life of a reserve item caused by deferred maintenance.
768 b. The members of a unit-owner-controlled association may
769 determine, by a majority vote of the total voting interests of
770 the association, to provide no reserves or less reserves than
771 required by this subsection. For a budget adopted on or after
772 December 31, 2024, the members of a unit-owner-controlled
773 association that must obtain a structural integrity reserve
774 study may not determine to provide no reserves or less reserves
775 than required by this subsection for items listed in paragraph
776 (g), except that members of an association operating a
777 multicondominium may determine to provide no reserves or less
778 reserves than required by this subsection if an alternative
779 funding method has been approved by the division.
780 c. For a budget adopted on or before December 31, 2028, a
781 unit-owner-controlled association that must have a structural
782 reserve study may secure a line of credit in lieu of maintaining
783 reserves for all or a portion of the reserves required under
784 this paragraph upon a majority vote of the total voting
785 interests of the association. The line of credit must be
786 sufficient to meet the association’s deferred maintenance
787 obligation not funded in the association’s reserve account for
788 each budget. Funding from the line of credit must be immediately
789 available for access by the board to fund required repair,
790 maintenance, or replacement expenses without further approval by
791 the members of the association. A line of credit secured under
792 this sub-subparagraph must be included in the financial report
793 required under s. 718.111(13).
794 d. If the local building official, as defined in s.
795 468.603, determines that the entire condominium building is
796 uninhabitable due to a natural emergency, as defined in s.
797 252.34, the board, upon the approval of a majority of its
798 members, may pause the contribution to its reserves or reduce
799 reserve funding until the local building official determines
800 that the condominium building is habitable. Any reserve account
801 funds held by the association may be expended, pursuant to the
802 board’s determination, to make the condominium building and its
803 structures habitable. Upon the determination by the local
804 building official that the condominium building is habitable,
805 the association must immediately resume contributing funds to
806 its reserves.
807 e. For a budget adopted on or before December 31, 2028, if
808 the association has completed a milestone inspection pursuant to
809 s. 553.899 within the previous 2 calendar years, the board, upon
810 the approval of a majority of the total voting interests of the
811 association, may temporarily pause reserve fund contributions or
812 reduce the amount of reserve funding for the purpose of funding
813 repairs recommended by the milestone inspection. This sub
814 subparagraph does not apply to a developer-controlled
815 association and an association in which the non-developer unit
816 owners have been in control for less than 1 year. An association
817 that has paused reserve contributions under this subparagraph
818 must have a structural integrity reserve study performed before
819 the continuation of reserve contributions in order to determine
820 the association’s reserve funding needs and to recommend a
821 reserve funding plan.
822 f.b. Before turnover of control of an association by a
823 developer to unit owners other than a developer under s.
824 718.301, the developer-controlled association may not vote to
825 waive the reserves or reduce funding of the reserves. If a
826 meeting of the unit owners has been called to determine whether
827 to waive or reduce the funding of reserves and no such result is
828 achieved or a quorum is not attained, the reserves included in
829 the budget shall go into effect. After the turnover, the
830 developer may vote its voting interest to waive or reduce the
831 funding of reserves.
832 3. Reserve funds and any interest accruing thereon shall
833 remain in the reserve account or accounts, and may be used only
834 for authorized reserve expenditures unless their use for other
835 purposes is approved in advance by a majority vote of all the
836 total voting interests of the association. Before turnover of
837 control of an association by a developer to unit owners other
838 than the developer pursuant to s. 718.301, the developer
839 controlled association may not vote to use reserves for purposes
840 other than those for which they were intended. For a budget
841 adopted on or after December 31, 2024, members of a unit-owner
842 controlled association that must obtain a structural integrity
843 reserve study may not vote to use reserve funds, or any interest
844 accruing thereon, for any other purpose other than the
845 replacement or deferred maintenance costs of the components
846 listed in paragraph (g). A vote of the members is not required
847 for the board to change the accounting method for reserves to a
848 pooling accounting method or a straight-line accounting method.
849 4. The only voting interests that are eligible to vote on
850 questions that involve waiving or reducing the funding of
851 reserves, or using existing reserve funds for purposes other
852 than purposes for which the reserves were intended, are the
853 voting interests of the units subject to assessment to fund the
854 reserves in question. Proxy questions relating to waiving or
855 reducing the funding of reserves or using existing reserve funds
856 for purposes other than purposes for which the reserves were
857 intended must contain the following statement in capitalized,
858 bold letters in a font size larger than any other used on the
859 face of the proxy ballot: WAIVING OF RESERVES, IN WHOLE OR IN
860 PART, OR ALLOWING ALTERNATIVE USES OF EXISTING RESERVES MAY
861 RESULT IN UNIT OWNER LIABILITY FOR PAYMENT OF UNANTICIPATED
862 SPECIAL ASSESSMENTS REGARDING THOSE ITEMS.
863 (g) Structural integrity reserve study.—
864 1. A residential condominium association must have a
865 structural integrity reserve study completed at least every 10
866 years after the condominium’s creation for each building on the
867 condominium property that is three stories or higher in height,
868 as determined by the Florida Building Code, which includes, at a
869 minimum, a study of the following items as related to the
870 structural integrity and safety of the building:
871 a. Roof.
872 b. Structure, including load-bearing walls and other
873 primary structural members and primary structural systems as
874 those terms are defined in s. 627.706.
875 c. Fireproofing and fire protection systems.
876 d. Plumbing.
877 e. Electrical systems.
878 f. Waterproofing and exterior painting.
879 g. Windows and exterior doors.
880 h. Any other item that has a deferred maintenance expense
881 or replacement cost that exceeds $10,000 and the failure to
882 replace or maintain such item negatively affects the items
883 listed in sub-subparagraphs a.-g., as determined by the visual
884 inspection portion of the structural integrity reserve study.
885 2. A structural integrity reserve study is based on a
886 visual inspection of the condominium property.
887 3.a. A structural integrity reserve study may be performed
888 by any person qualified to perform such study. However, the
889 visual inspection portion of the structural integrity reserve
890 study must be performed or verified by an engineer licensed
891 under chapter 471, an architect licensed under chapter 481, or a
892 person certified as a reserve specialist or professional reserve
893 analyst by the Community Associations Institute or the
894 Association of Professional Reserve Analysts.
895 b. Any design professional as defined in s. 558.002 or
896 contractor licensed under chapter 489 who bids to perform a
897 structural integrity reserve study must disclose in writing to
898 the association his or her intent to bid on any services related
899 to any maintenance, repair, or replacement that may be
900 recommended by the structural integrity reserve study. Any
901 design professional as defined in s. 558.002 or contractor
902 licensed under chapter 489 who submits a bid to the association
903 for performing any services recommended by the structural
904 integrity reserve study may not have an interest, directly or
905 indirectly, in the firm or entity providing the association’s
906 structural integrity reserve study or be a relative of any
907 person having a direct or indirect interest in such firm, unless
908 such relationship is disclosed to the association in writing. As
909 used in this section, the term “relative” means a relative
910 within the third degree of consanguinity by blood or marriage. A
911 contract for services is voidable and terminates upon the
912 association filing a written notice terminating the contract if
913 the design professional or licensed contractor failed to provide
914 the written disclosure of the interests or relationships
915 required under this paragraph. A design professional or licensed
916 contractor may be subject to discipline under the applicable
917 practice act for his or her profession for failure to provide
918 the written disclosure of the interests or relationships
919 required under this paragraph.
920 4.a.3. At a minimum, a structural integrity reserve study
921 must identify each item of the condominium property being
922 visually inspected, state the estimated remaining useful life
923 and the estimated replacement cost or deferred maintenance
924 expense of each item of the condominium property being visually
925 inspected, and provide a reserve funding plan or schedule with a
926 recommended annual reserve amount that achieves the estimated
927 replacement cost or deferred maintenance expense of each item of
928 condominium property being visually inspected by the end of the
929 estimated remaining useful life of the item. At a minimum, the
930 structural integrity reserve study must include a recommendation
931 for a reserve funding schedule based on a baseline funding plan
932 that provides a reserve funding goal in which the expenditures
933 for each budget year for deferred maintenance, repair, and
934 replacement of reserve items are sufficient to maintain the
935 reserve cash balance above zero. The study may recommend other
936 types of reserve funding schedules, provided that each
937 recommended schedule is sufficient to meet the association’s
938 maintenance obligation.
939 b. The structural integrity reserve study may recommend
940 that reserves do not need to be maintained for any item for
941 which an estimate of useful life and an estimate of replacement
942 cost cannot be determined, or the study may recommend a deferred
943 maintenance expense amount for such item. The structural
944 integrity reserve study may recommend that reserves for
945 replacement costs do not need to be maintained for any item with
946 an estimated remaining useful life of greater than 25 years, but
947 the study may recommend a deferred maintenance expense amount
948 for such item. If the structural integrity reserve study
949 recommends reserves for any item for which reserves are not
950 required under this paragraph, the amount of the recommended
951 reserves for such item must be separately identified in the
952 structural integrity reserve study as an item for which reserves
953 are not required under this paragraph.
954 5.4. This paragraph does not apply to buildings less than
955 three stories in height; single-family, two-family, or three
956 family dwellings with three or fewer habitable stories above
957 ground; any portion or component of a building that has not been
958 submitted to the condominium form of ownership; or any portion
959 or component of a building that is maintained by a party other
960 than the association.
961 6.5. Before a developer turns over control of an
962 association to unit owners other than the developer, the
963 developer must have a turnover inspection report in compliance
964 with s. 718.301(4)(p) and (q) for each building on the
965 condominium property that is three stories or higher in height.
966 7.6. Associations existing on or before July 1, 2022, which
967 are controlled by unit owners other than the developer, must
968 have a structural integrity reserve study completed by December
969 31, 2025 2024, for each building on the condominium property
970 that is three stories or higher in height. An association that
971 is required to complete a milestone inspection in accordance
972 with s. 553.899 on or before December 31, 2026, may complete the
973 structural integrity reserve study simultaneously with the
974 milestone inspection. In no event may the structural integrity
975 reserve study be completed after December 31, 2026.
976 8.7. If the milestone inspection required by s. 553.899, or
977 an inspection completed for a similar local requirement, was
978 performed within the past 5 years and meets the requirements of
979 this paragraph, such inspection may be used in place of the
980 visual inspection portion of the structural integrity reserve
981 study.
982 9. If the association completes a milestone inspection
983 required by s. 553.899, or an inspection completed for a similar
984 local requirement, the association may delay performance of a
985 required structural integrity reserve study for no more than 2
986 budget years to permit the association to focus its financial
987 resources on the completing the repair and maintenance
988 recommendations of the milestone inspection.
989 10.8. If the officers or directors of an association
990 willfully and knowingly fail to complete a structural integrity
991 reserve study pursuant to this paragraph, such failure is a
992 breach of an officer’s and director’s fiduciary relationship to
993 the unit owners under s. 718.111(1).
994 11.9. Within 45 days after receiving the structural
995 integrity reserve study, the association must distribute a copy
996 of the study to each unit owner or deliver to each unit owner a
997 notice that the completed study is available for inspection and
998 copying upon a written request. Distribution of a copy of the
999 study or notice must be made by United States mail or personal
1000 delivery to the mailing address, property address, or any other
1001 address of the owner provided to fulfill the association’s
1002 notice requirements under this chapter, or by electronic
1003 transmission to the e-mail address or facsimile number provided
1004 to fulfill the association’s notice requirements to unit owners
1005 who previously consented to receive notice by electronic
1006 transmission.
1007 12.10. Within 45 days after receiving the structural
1008 integrity reserve study, the association must provide the
1009 division with a statement indicating that the study was
1010 completed and that the association provided or made available
1011 such study to each unit owner in accordance with this section.
1012 The statement must be provided to the division in the manner
1013 established by the division using a form posted on the
1014 division’s website.
1015 13. The division shall adopt by rule the form for the
1016 structural integrity reserve study in coordination with the
1017 Florida Building Commission.
1018 Section 3. Paragraphs (d) and (e) of subsection (2) of
1019 section 718.503, Florida Statutes, are amended, and paragraph
1020 (d) of subsection (1) of that section is reenacted, to read:
1021 718.503 Developer disclosure prior to sale; nondeveloper
1022 unit owner disclosure prior to sale; voidability.—
1023 (1) DEVELOPER DISCLOSURE.—
1024 (d) Milestone inspection, turnover inspection report, or
1025 structural integrity reserve study.—If the association is
1026 required to have completed a milestone inspection as described
1027 in s. 553.899, a turnover inspection report for a turnover
1028 inspection performed on or after July 1, 2023, or a structural
1029 integrity reserve study, and the association has not completed
1030 the milestone inspection, the turnover inspection report, or the
1031 structural integrity reserve study, each contract entered into
1032 after December 31, 2024, for the sale of a residential unit
1033 shall contain in conspicuous type a statement indicating that
1034 the association is required to have a milestone inspection, a
1035 turnover inspection report, or a structural integrity reserve
1036 study and has not completed such inspection, report, or study,
1037 as appropriate. If the association is not required to have a
1038 milestone inspection as described in s. 553.899 or a structural
1039 integrity reserve study, each contract entered into after
1040 December 31, 2024, for the sale of a residential unit shall
1041 contain in conspicuous type a statement indicating that the
1042 association is not required to have a milestone inspection or a
1043 structural integrity reserve study, as appropriate. If the
1044 association has completed a milestone inspection as described in
1045 s. 553.899, a turnover inspection report for a turnover
1046 inspection performed on or after July 1, 2023, or a structural
1047 integrity reserve study, each contract entered into after
1048 December 31, 2024, for the sale of a residential unit shall
1049 contain in conspicuous type:
1050 1. A clause which states: THE BUYER HEREBY ACKNOWLEDGES
1051 THAT BUYER HAS BEEN PROVIDED A CURRENT COPY OF THE INSPECTOR
1052 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1053 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1054 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1055 718.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1056 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1057 RESERVE STUDY DESCRIBED IN SECTIONS 718.103(26) AND
1058 718.112(2)(g), FLORIDA STATUTES, IF APPLICABLE, MORE THAN 15
1059 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, PRIOR TO
1060 EXECUTION OF THIS CONTRACT; and
1061 2. A clause which states: THIS AGREEMENT IS VOIDABLE BY
1062 BUYER BY DELIVERING WRITTEN NOTICE OF THE BUYER’S INTENTION TO
1063 CANCEL WITHIN 15 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL
1064 HOLIDAYS, AFTER THE DATE OF EXECUTION OF THIS AGREEMENT BY THE
1065 BUYER AND RECEIPT BY BUYER OF A CURRENT COPY OF THE INSPECTOR
1066 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1067 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1068 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1069 718.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1070 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1071 RESERVE STUDY DESCRIBED IN SECTIONS 718.103(26) AND
1072 718.112(2)(g), FLORIDA STATUTES, IF APPLICABLE. ANY PURPORTED
1073 WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO EFFECT. BUYER
1074 MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF NOT MORE THAN 15
1075 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, AFTER
1076 THE BUYER RECEIVES A CURRENT COPY OF THE INSPECTOR-PREPARED
1077 SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED IN
1078 SECTION 553.899, FLORIDA STATUTES; A COPY OF THE TURNOVER
1079 INSPECTION REPORT DESCRIBED IN SECTION 718.301(4)(p) AND (q),
1080 FLORIDA STATUTES; OR A COPY OF THE ASSOCIATION’S MOST RECENT
1081 STRUCTURAL INTEGRITY RESERVE STUDY DESCRIBED IN SECTIONS
1082 718.103(26) AND 718.112(2)(g), FLORIDA STATUTES, IF REQUESTED IN
1083 WRITING. BUYER’S RIGHT TO VOID THIS AGREEMENT SHALL TERMINATE AT
1084 CLOSING.
1085
1086 A contract that does not conform to the requirements of this
1087 paragraph is voidable at the option of the purchaser prior to
1088 closing.
1089 (2) NONDEVELOPER DISCLOSURE.—
1090 (d) Each contract entered into after July 1, 1992, for the
1091 resale of a residential unit must shall contain in conspicuous
1092 type either:
1093 1. A clause which states: THE BUYER HEREBY ACKNOWLEDGES
1094 THAT BUYER HAS BEEN PROVIDED A CURRENT COPY OF THE DECLARATION
1095 OF CONDOMINIUM, ARTICLES OF INCORPORATION OF THE ASSOCIATION,
1096 BYLAWS AND RULES OF THE ASSOCIATION, A COPY OF THE MOST RECENT
1097 ANNUAL FINANCIAL STATEMENT AND ANNUAL BUDGET, AND FREQUENTLY
1098 ASKED QUESTIONS AND ANSWERS DOCUMENT MORE THAN 15 3 DAYS,
1099 EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, PRIOR TO
1100 EXECUTION OF THIS CONTRACT; or
1101 2. A clause which states: THIS AGREEMENT IS VOIDABLE BY
1102 BUYER BY DELIVERING WRITTEN NOTICE OF THE BUYER’S INTENTION TO
1103 CANCEL WITHIN 15 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL
1104 HOLIDAYS, AFTER THE DATE OF EXECUTION OF THIS AGREEMENT BY THE
1105 BUYER AND RECEIPT BY BUYER OF A CURRENT COPY OF THE DECLARATION
1106 OF CONDOMINIUM, ARTICLES OF INCORPORATION, BYLAWS AND RULES OF
1107 THE ASSOCIATION, A COPY OF THE MOST RECENT ANNUAL FINANCIAL
1108 STATEMENT AND ANNUAL BUDGET, AND FREQUENTLY ASKED QUESTIONS AND
1109 ANSWERS DOCUMENT IF SO REQUESTED IN WRITING. ANY PURPORTED
1110 WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO EFFECT. BUYER
1111 MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF NOT MORE THAN 15
1112 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, AFTER
1113 THE BUYER RECEIVES THE DECLARATION, ARTICLES OF INCORPORATION,
1114 BYLAWS AND RULES OF THE ASSOCIATION, AND A COPY OF THE MOST
1115 RECENT YEAR-END FINANCIAL STATEMENT AND ANNUAL BUDGET
1116 INFORMATION AND FREQUENTLY ASKED QUESTIONS AND ANSWERS DOCUMENT
1117 IF REQUESTED IN WRITING. BUYER’S RIGHT TO VOID THIS AGREEMENT
1118 SHALL TERMINATE AT CLOSING.
1119
1120 A contract that does not conform to the requirements of this
1121 paragraph is voidable at the option of the purchaser prior to
1122 closing.
1123 (e) If the association is required to have completed a
1124 milestone inspection as described in s. 553.899, a turnover
1125 inspection report for a turnover inspection performed on or
1126 after July 1, 2023, or a structural integrity reserve study, and
1127 the association has not completed the milestone inspection, the
1128 turnover inspection report, or the structural integrity reserve
1129 study, each contract entered into after December 31, 2024, for
1130 the sale of a residential unit shall contain in conspicuous type
1131 a statement indicating that the association is required to have
1132 a milestone inspection, a turnover inspection report, or a
1133 structural integrity reserve study and has not completed such
1134 inspection, report, or study, as appropriate. If the association
1135 is not required to have a milestone inspection as described in
1136 s. 553.899 or a structural integrity reserve study, each
1137 contract entered into after December 31, 2024, for the sale of a
1138 residential unit shall contain in conspicuous type a statement
1139 indicating that the association is not required to have a
1140 milestone inspection or a structural integrity reserve study, as
1141 appropriate. If the association has completed a milestone
1142 inspection as described in s. 553.899, a turnover inspection
1143 report for a turnover inspection performed on or after July 1,
1144 2023, or a structural integrity reserve study, each contract
1145 entered into after December 31, 2024, for the resale of a
1146 residential unit shall contain in conspicuous type:
1147 1. A clause which states: THE BUYER HEREBY ACKNOWLEDGES
1148 THAT BUYER HAS BEEN PROVIDED A CURRENT COPY OF THE INSPECTOR
1149 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1150 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1151 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1152 718.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1153 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1154 RESERVE STUDY DESCRIBED IN SECTIONS 718.103(26) AND
1155 718.112(2)(g), FLORIDA STATUTES, IF APPLICABLE, MORE THAN 15 3
1156 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, PRIOR TO
1157 EXECUTION OF THIS CONTRACT; and
1158 2. A clause which states: THIS AGREEMENT IS VOIDABLE BY
1159 BUYER BY DELIVERING WRITTEN NOTICE OF THE BUYER’S INTENTION TO
1160 CANCEL WITHIN 15 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL
1161 HOLIDAYS, AFTER THE DATE OF EXECUTION OF THIS AGREEMENT BY THE
1162 BUYER AND RECEIPT BY BUYER OF A CURRENT COPY OF THE INSPECTOR
1163 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1164 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1165 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1166 718.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1167 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1168 RESERVE STUDY DESCRIBED IN SECTIONS 718.103(26) AND
1169 718.112(2)(g), FLORIDA STATUTES, IF APPLICABLE. ANY PURPORTED
1170 WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO EFFECT. BUYER
1171 MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF NOT MORE THAN 15
1172 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, AFTER
1173 THE BUYER RECEIVES A CURRENT COPY OF THE INSPECTOR-PREPARED
1174 SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED IN
1175 SECTION 553.899, FLORIDA STATUTES; A COPY OF THE TURNOVER
1176 INSPECTION REPORT DESCRIBED IN SECTION 718.301(4)(p) AND (q),
1177 FLORIDA STATUTES; OR A COPY OF THE ASSOCIATION’S MOST RECENT
1178 STRUCTURAL INTEGRITY RESERVE STUDY DESCRIBED IN SECTIONS
1179 718.103(26) AND 718.112(2)(g), FLORIDA STATUTES, IF REQUESTED IN
1180 WRITING. BUYER’S RIGHT TO VOID THIS AGREEMENT SHALL TERMINATE AT
1181 CLOSING.
1182
1183 A contract that does not conform to the requirements of this
1184 paragraph is voidable at the option of the purchaser prior to
1185 closing.
1186 Section 4. Section 8 of chapter 2024-244, Laws of Florida,
1187 is amended to read:
1188 Section 8. Effective January 1, 2026, paragraph (g) of
1189 subsection (12) of section 718.111, Florida Statutes, as amended
1190 by this act, is amended to read:
1191 718.111 The association.—
1192 (12) OFFICIAL RECORDS.—
1193 (g)1. By January 1, 2019, An association managing a
1194 condominium with 25 150 or more units which does not contain
1195 timeshare units shall post digital copies of the documents
1196 specified in subparagraph 2. on its website or make such
1197 documents available through an application that can be
1198 downloaded on a mobile device.
1199 a. The association’s website or application must be:
1200 (I) An independent website, application, or web portal
1201 wholly owned and operated by the association; or
1202 (II) A website, application, or web portal operated by a
1203 third-party provider with whom the association owns, leases,
1204 rents, or otherwise obtains the right to operate a web page,
1205 subpage, web portal, collection of subpages or web portals, or
1206 an application which is dedicated to the association’s
1207 activities and on which required notices, records, and documents
1208 may be posted or made available by the association.
1209 b. The association’s website or application must be
1210 accessible through the Internet and must contain a subpage, web
1211 portal, or other protected electronic location that is
1212 inaccessible to the general public and accessible only to unit
1213 owners and employees of the association.
1214 c. Upon a unit owner’s written request, the association
1215 must provide the unit owner with a username and password and
1216 access to the protected sections of the association’s website or
1217 application which contain any notices, records, or documents
1218 that must be electronically provided.
1219 2. A current copy of the following documents must be posted
1220 in digital format on the association’s website or application:
1221 a. The recorded declaration of condominium of each
1222 condominium operated by the association and each amendment to
1223 each declaration.
1224 b. The recorded bylaws of the association and each
1225 amendment to the bylaws.
1226 c. The articles of incorporation of the association, or
1227 other documents creating the association, and each amendment to
1228 the articles of incorporation or other documents. The copy
1229 posted pursuant to this sub-subparagraph must be a copy of the
1230 articles of incorporation filed with the Department of State.
1231 d. The rules of the association.
1232 e. The minutes of all meetings of the association, the
1233 board of administration, and the unit owners over the preceding
1234 12 months.
1235 f.e. A list of all executory contracts or documents to
1236 which the association is a party or under which the association
1237 or the unit owners have an obligation or responsibility and,
1238 after bidding for the related materials, equipment, or services
1239 has closed, a list of bids received by the association within
1240 the past year. Summaries of bids for materials, equipment, or
1241 services which exceed $500 must be maintained on the website or
1242 application for 1 year. In lieu of summaries, complete copies of
1243 the bids may be posted.
1244 g.f. The annual budget required by s. 718.112(2)(f) and any
1245 proposed budget to be considered at the annual meeting.
1246 h.g. The financial report required by subsection (13) and
1247 any monthly income or expense statement to be considered at a
1248 meeting.
1249 i.h. The certification of each director required by s.
1250 718.112(2)(d)4.b.
1251 j.i. All contracts or transactions between the association
1252 and any director, officer, corporation, firm, or association
1253 that is not an affiliated condominium association or any other
1254 entity in which an association director is also a director or
1255 officer and financially interested.
1256 k.j. Any contract or document regarding a conflict of
1257 interest or possible conflict of interest as provided in ss.
1258 468.4335, 468.436(2)(b)6., and 718.3027(3).
1259 l.k. The notice of any unit owner meeting and the agenda
1260 for the meeting, as required by s. 718.112(2)(d)3., no later
1261 than 14 days before the meeting. The notice must be posted in
1262 plain view on the front page of the website or application, or
1263 on a separate subpage of the website or application labeled
1264 “Notices” which is conspicuously visible and linked from the
1265 front page. The association must also post on its website or
1266 application any document to be considered and voted on by the
1267 owners during the meeting or any document listed on the agenda
1268 at least 7 days before the meeting at which the document or the
1269 information within the document will be considered.
1270 m.l. Notice of any board meeting, the agenda, and any other
1271 document required for the meeting as required by s.
1272 718.112(2)(c), which must be posted no later than the date
1273 required for notice under s. 718.112(2)(c).
1274 n.m. The inspection reports described in ss. 553.899 and
1275 718.301(4)(p) and any other inspection report relating to a
1276 structural or life safety inspection of condominium property.
1277 o.n. The association’s most recent structural integrity
1278 reserve study, if applicable.
1279 p.o. Copies of all building permits issued for ongoing or
1280 planned construction.
1281 3. The association shall ensure that the information and
1282 records described in paragraph (c), which are not allowed to be
1283 accessible to unit owners, are not posted on the association’s
1284 website or application. If protected information or information
1285 restricted from being accessible to unit owners is included in
1286 documents that are required to be posted on the association’s
1287 website or application, the association shall ensure the
1288 information is redacted before posting the documents.
1289 Notwithstanding the foregoing, the association or its agent is
1290 not liable for disclosing information that is protected or
1291 restricted under this paragraph unless such disclosure was made
1292 with a knowing or intentional disregard of the protected or
1293 restricted nature of such information.
1294 4. The failure of the association to post information
1295 required under subparagraph 2. is not in and of itself
1296 sufficient to invalidate any action or decision of the
1297 association’s board or its committees.
1298 Section 5. Section 31 of chapter 2024-244, Laws of Florida,
1299 is amended to read:
1300 Section 31. The amendments made to ss. 718.103(14) and
1301 718.202(3) and 718.407(1), (2), and (6), Florida Statutes, as
1302 created by this act, may not are intended to clarify existing
1303 law and shall apply retroactively and shall only apply to
1304 condominiums for which declarations were initially recorded on
1305 or after July 1, 2025. However, Such amendments do not revive or
1306 reinstate any right or interest that has been fully and finally
1307 adjudicated as invalid before October 1, 2024.
1308 Section 6. Subsection (13) is added to section 719.104,
1309 Florida Statutes, to read:
1310 719.104 Cooperatives; access to units; records; financial
1311 reports; assessments; purchase of leases.—
1312 (13) INVESTMENT OF ASSOCIATION FUNDS.—
1313 (a) A board shall, in fulfilling its duty to manage
1314 operating and reserve funds of an association, use best efforts
1315 to make prudent investment decisions that carefully consider
1316 risk and return in an effort to maximize returns on invested
1317 funds.
1318 (b) An association may invest reserve funds in one or any
1319 combination of depository accounts at a community bank, savings
1320 bank, commercial bank, savings and loan association, or credit
1321 union if the respective account balance at any institution does
1322 not exceed the amount of deposit insurance per account provided
1323 by any agency of the Federal Government or as otherwise
1324 available. Notwithstanding any declaration, only funds
1325 identified as reserve funds may be invested pursuant to this
1326 subsection.
1327 (c) The board shall create an investment committee composed
1328 of at least two board members and two-unit unit members who are
1329 unit owners but not board members. The board shall also adopt
1330 rules for invested funds, including, but not limited to, rules
1331 requiring periodic reviews of any investment manager’s
1332 performance, the development of an investment policy statement,
1333 and that all meetings of the investment committee be recorded
1334 and made part of the official records of the association. The
1335 investment policy statement developed pursuant to this paragraph
1336 must, at a minimum, address risk, liquidity, and benchmark
1337 measurements; authorized classes of investments; authorized
1338 investment mixes; limitations on authority relating to
1339 investment transactions; requirements for projected reserve
1340 expenditures within, at minimum, the next 24 months to be held
1341 in cash or cash equivalents; projected expenditures relating to
1342 an inspection performed pursuant to s. 553.899; and protocols
1343 for proxy response.
1344 (d) The investment committee shall recommend investment
1345 advisers to the board, and the board shall select one of the
1346 recommended investment advisers to provide services to the
1347 association. Such investment advisers must be registered or have
1348 notice filed under s. 517.12. The investment adviser and any
1349 representative or association of the investment adviser may not
1350 be related by affinity or consanguinity to, or under common
1351 ownership with, any board member, community management company,
1352 reserve study provider, or unit owner. The investment adviser
1353 shall comply with the prudent investor rule in s. 518.11. The
1354 investment adviser shall act as a fiduciary to the association
1355 in compliance with the standards set forth in the Employee
1356 Retirement Income Security Act of 1974 at 29 U.S.C. s.
1357 1104(a)(1)(A)-(C). In case of conflict with other provisions of
1358 law authorizing investments, the investment and fiduciary
1359 standards set forth in this paragraph must prevail. If at any
1360 time the investment committee determines that an investment
1361 adviser does not meet the requirements of this section, the
1362 investment committee must recommend a replacement investment
1363 adviser to the board.
1364 (e) At least once each calendar year, or sooner if a
1365 substantial financial obligation of the association becomes
1366 known to the board, the association must provide the investment
1367 adviser with the association’s investment policy statement, the
1368 most recent reserve study report, the association’s structural
1369 integrity report, and the financial reports prepared pursuant to
1370 subsection (13). If there is no recent reserve study report, the
1371 association must provide the investment adviser with a good
1372 faith estimate disclosing the annual amount of reserve funds
1373 necessary for the association to fully fund reserves for the
1374 life of each reserve component and each component’s
1375 redundancies. The investment adviser shall annually review these
1376 documents and provide the association with a portfolio
1377 allocation model that is suitably structured and prudently
1378 designed to match projected annual reserve fund requirements and
1379 liability, assets, and liquidity requirements. The investment
1380 adviser shall prepare a funding projection for each reserve
1381 component, including any of the component’s redundancies. The
1382 association shall have available at all times a minimum of 24
1383 months of projected reserves in cash or cash equivalents.
1384 (f) Portfolios managed by the investment adviser may
1385 contain any type of investment necessary to meet the objectives
1386 in the investment policy statement; however, portfolios may not
1387 contain stocks, securities, or other obligations that the State
1388 Board of Administration is prohibited from investing in under s.
1389 215.471, s. 215.4725, or s. 215.473 or that state agencies are
1390 prohibited from investing in under s. 215.472, as determined by
1391 the investment adviser. Any funds invested by the investment
1392 adviser must be held in third-party custodial accounts that are
1393 subject to insurance coverage by the Securities Investor
1394 Protection Corporation in an amount equal to or greater than the
1395 invested amount. The investment adviser may withdraw investment
1396 fees, expenses, and commissions from invested funds.
1397 (g) The investment adviser shall:
1398 1. Annually provide the association with a written
1399 certification of compliance with this section and a list of
1400 stocks, securities, and other obligations that are prohibited
1401 from being in association portfolios under paragraph (f); and
1402 2. Submit monthly, quarterly, and annual reports to the
1403 association which are prepared in accordance with established
1404 financial industry standards and in accordance with chapter 517.
1405 (h) Any principal, earnings, or interest managed under this
1406 subsection must be available at no cost or charge to the
1407 association within 15 business days after delivery of the
1408 association’s written or electronic request.
1409 (i) Unallocated income earned on reserve fund investments
1410 may be spent only on capital expenditures, planned maintenance,
1411 structural repairs, or other items for which the reserve
1412 accounts have been established. Any surplus of funds which
1413 exceeds the amount required to maintain reasonably funded
1414 reserves must be managed pursuant to s. 718.115.
1415 Section 7. Paragraphs (j) and (k) of subsection (1) of
1416 section 719.106, Florida Statutes, are amended to read:
1417 719.106 Bylaws; cooperative ownership.—
1418 (1) MANDATORY PROVISIONS.—The bylaws or other cooperative
1419 documents shall provide for the following, and if they do not,
1420 they shall be deemed to include the following:
1421 (j) Annual budget.—
1422 1. The proposed annual budget of common expenses must be
1423 detailed and must show the amounts budgeted by accounts and
1424 expense classifications, including, if applicable, but not
1425 limited to, those expenses listed in s. 719.504(20). The board
1426 of administration shall adopt the annual budget at least 14 days
1427 before the start of the association’s fiscal year. In the event
1428 that the board fails to timely adopt the annual budget a second
1429 time, it is deemed a minor violation and the prior year’s budget
1430 shall continue in effect until a new budget is adopted.
1431 2.a. In addition to annual operating expenses, the budget
1432 must include reserve accounts for capital expenditures and
1433 deferred maintenance. These accounts must include, but not be
1434 limited to, roof replacement, building painting, and pavement
1435 resurfacing, regardless of the amount of deferred maintenance
1436 expense or replacement cost, and for any other items for which
1437 the deferred maintenance expense or replacement cost exceeds
1438 $10,000. The amount to be reserved must be computed by means of
1439 a formula which is based upon estimated remaining useful life
1440 and estimated replacement cost or deferred maintenance expense
1441 of the reserve item. In a budget adopted by an association that
1442 is required to obtain a structural integrity reserve study,
1443 reserves must be maintained for the items identified in
1444 paragraph (k) for which the association is responsible pursuant
1445 to the declaration, and the reserve amount for such items must
1446 be based on the findings and recommendations of the
1447 association’s most recent structural integrity reserve study.
1448 With respect to items for which an estimate of useful life is
1449 not readily ascertainable or with an estimated remaining useful
1450 life of greater than 25 years, an association is not required to
1451 reserve replacement costs for such items, but an association
1452 must reserve the amount of deferred maintenance expense, if any,
1453 which is recommended by the structural integrity reserve study
1454 for such items. The association may adjust replacement reserve
1455 assessments annually to take into account an inflation
1456 adjustment and any changes in estimates or extension of the
1457 useful life of a reserve item caused by deferred maintenance.
1458 b. The members of a unit-owner-controlled association may
1459 determine, by a majority vote of the total voting interests of
1460 the association, for a fiscal year to provide no reserves or
1461 reserves less adequate than required by this subsection. Before
1462 turnover of control of an association by a developer to unit
1463 owners other than a developer under s. 719.301, the developer
1464 controlled association may not vote to waive the reserves or
1465 reduce funding of the reserves.
1466 c. For a budget adopted on or after December 31, 2024, a
1467 unit-owner-controlled association that must obtain a structural
1468 integrity reserve study may not determine to provide no reserves
1469 or reserves less adequate than required by this paragraph for
1470 items listed in paragraph (k). If a meeting of the unit owners
1471 has been called to determine to provide no reserves, or reserves
1472 less adequate than required, and such result is not attained or
1473 a quorum is not attained, the reserves as included in the budget
1474 shall go into effect.
1475 d. If the local building official, as defined in s.
1476 468.603, determines that the entire condominium building is
1477 uninhabitable due to a natural emergency, as defined in s.
1478 252.34, the board may pause the contribution to its reserves or
1479 reduce reserve funding until the local building official
1480 determines that the condominium building is habitable. Any
1481 reserve account funds held by the association may be expended,
1482 pursuant to the board’s determination, to make the condominium
1483 building and its structures habitable. Upon the determination by
1484 the local building official that the condominium building is
1485 habitable, the association must immediately resume contributing
1486 funds to its reserves.
1487 e. For a budget adopted on or before December 31, 2028, a
1488 unit-owner-controlled association that must have a structural
1489 reserve study may secure a line of credit in lieu of maintaining
1490 reserves for all or a portion of the reserves required under
1491 this paragraph and paragraph (f) upon a majority vote of the
1492 total voting interests of the association. The line of credit
1493 must be sufficient to meet the association’s deferred
1494 maintenance obligation not funded in the association’s reserve
1495 account for each budget. Funding from the line of credit must be
1496 immediately available for access by the board to fund required
1497 repair, maintenance, or replacement expenses without further
1498 approval by the members of the association.
1499 f. For a budget adopted on or before December 31, 2028, if
1500 the association has completed a milestone inspection pursuant to
1501 s. 553.899 within the previous 2 calendar years, the board, upon
1502 the approval of a majority of the total voting interests of the
1503 association, may temporarily pause reserve fund contributions or
1504 reduce the amount of reserve funding for the purpose of funding
1505 repairs recommended by the milestone inspection. This
1506 subparagraph does not apply to a developer-controlled
1507 association and an association in which the non-developer unit
1508 owners have been in control for less than 1 year. An association
1509 that has paused reserve contributions under this sub
1510 subparagraph must have a structural integrity reserve study
1511 performed before the continuation of reserve contributions in
1512 order to determine the association’s reserve funding needs and
1513 to recommend a reserve funding plan.
1514 3. Reserve funds and any interest accruing thereon shall
1515 remain in the reserve account or accounts, and shall be used
1516 only for authorized reserve expenditures unless their use for
1517 other purposes is approved in advance by a vote of the majority
1518 of the total voting interests of the association. Before
1519 turnover of control of an association by a developer to unit
1520 owners other than the developer under s. 719.301, the developer
1521 may not vote to use reserves for purposes other than that for
1522 which they were intended. For a budget adopted on or after
1523 December 31, 2024, members of a unit-owner-controlled
1524 association that must obtain a structural integrity reserve
1525 study may not vote to use reserve funds, or any interest
1526 accruing thereon, for purposes other than the replacement or
1527 deferred maintenance costs of the components listed in paragraph
1528 (k). A vote of the members is not required for the board to
1529 change the accounting method for reserves to a pooling
1530 accounting method or a straight-line accounting method.
1531 (k) Structural integrity reserve study.—
1532 1. A residential cooperative association must have a
1533 structural integrity reserve study completed at least every 10
1534 years for each building on the cooperative property that is
1535 three stories or higher in height, as determined by the Florida
1536 Building Code, that includes, at a minimum, a study of the
1537 following items as related to the structural integrity and
1538 safety of the building:
1539 a. Roof.
1540 b. Structure, including load-bearing walls and other
1541 primary structural members and primary structural systems as
1542 those terms are defined in s. 627.706.
1543 c. Fireproofing and fire protection systems.
1544 d. Plumbing.
1545 e. Electrical systems.
1546 f. Waterproofing and exterior painting.
1547 g. Windows and exterior doors.
1548 h. Any other item that has a deferred maintenance expense
1549 or replacement cost that exceeds $10,000 and the failure to
1550 replace or maintain such item negatively affects the items
1551 listed in sub-subparagraphs a.-g., as determined by the visual
1552 inspection portion of the structural integrity reserve study.
1553 2. A structural integrity reserve study is based on a
1554 visual inspection of the cooperative property.
1555 3.a. A structural integrity reserve study may be performed
1556 by any person qualified to perform such study. However, the
1557 visual inspection portion of the structural integrity reserve
1558 study must be performed or verified by an engineer licensed
1559 under chapter 471, an architect licensed under chapter 481, or a
1560 person certified as a reserve specialist or professional reserve
1561 analyst by the Community Associations Institute or the
1562 Association of Professional Reserve Analysts.
1563 b. Any design professional as defined in s. 558.002(7) or
1564 contractor licensed under chapter 489 who bids to perform a
1565 structural integrity reserve study must disclose in writing to
1566 the association his or her intent to bid on any services related
1567 to any maintenance, repair, or replacement that may be
1568 recommended by the structural integrity reserve study. Any
1569 design professional as defined in s. 558.002(7) or contractor
1570 licensed under chapter 489 who submits a bid to the association
1571 for performing any services recommended by the structural
1572 integrity reserve study may not have an interest, directly or
1573 indirectly, in the firm or entity providing the association’s
1574 structural integrity reserve study or be a relative of any
1575 person having a direct or indirect interest in such firm, unless
1576 such relationship is disclosed to the association in writing. As
1577 used in this section, the term “relative” means a relative
1578 within the third degree of consanguinity by blood or marriage. A
1579 contract for services is voidable and terminates upon the
1580 association filing a written notice terminating the contract if
1581 the design professional or licensed contractor failed to provide
1582 the written disclosure of the relationship required under this
1583 paragraph. A design professional or licensed contractor may be
1584 subject to discipline under the applicable practice act for his
1585 or her profession for failure to provide the written disclosure
1586 of the relationship required under this subparagraph.
1587 4.a 3. At a minimum, a structural integrity reserve study
1588 must identify each item of the cooperative property being
1589 visually inspected, state the estimated remaining useful life
1590 and the estimated replacement cost or deferred maintenance
1591 expense of each item of the cooperative property being visually
1592 inspected, and provide a reserve funding schedule with a
1593 recommended annual reserve amount that achieves the estimated
1594 replacement cost or deferred maintenance expense of each item of
1595 cooperative property being visually inspected by the end of the
1596 estimated remaining useful life of the item. The structural
1597 integrity reserve study may recommend that reserves do not need
1598 to be maintained for any item for which an estimate of useful
1599 life and an estimate of replacement cost cannot be determined,
1600 or the study may recommend a deferred maintenance expense amount
1601 for such item. At a minimum, the structural integrity reserve
1602 study must include a recommendation for a reserve funding
1603 schedule based on a baseline funding plan that provides a
1604 reserve funding goal in which the expenditures for each budget
1605 year for deferred maintenance, repair, and replacement of
1606 reserve items are sufficient to maintain the reserve cash
1607 balance above zero. The study may recommend other types of
1608 reserve funding schedules, provided that each recommended
1609 schedule is sufficient to meet the association’s maintenance
1610 obligation.
1611 b. The structural integrity reserve study may recommend
1612 that reserves for replacement costs do not need to be maintained
1613 for any item with an estimated remaining useful life of greater
1614 than 25 years, but the study may recommend a deferred
1615 maintenance expense amount for such item. If the structural
1616 integrity reserve study recommends reserves for any item for
1617 which reserves are not required under this paragraph, the amount
1618 of the recommended reserves for such item must be separately
1619 identified in the structural integrity reserve study as an item
1620 for which reserves are not required under this paragraph.
1621 5.4. This paragraph does not apply to buildings less than
1622 three stories in height; single-family, two-family, or three
1623 family dwellings with three or fewer habitable stories above
1624 ground; any portion or component of a building that has not been
1625 submitted to the cooperative form of ownership; or any portion
1626 or component of a building that is maintained by a party other
1627 than the association.
1628 6.5. Before a developer turns over control of an
1629 association to unit owners other than the developer, the
1630 developer must have a turnover inspection report in compliance
1631 with s. 719.301(4)(p) and (q) for each building on the
1632 cooperative property that is three stories or higher in height.
1633 7.6. Associations existing on or before July 1, 2022, which
1634 are controlled by unit owners other than the developer, must
1635 have a structural integrity reserve study completed by December
1636 31, 2024, for each building on the cooperative property that is
1637 three stories or higher in height. An association that is
1638 required to complete a milestone inspection on or before
1639 December 31, 2026, in accordance with s. 553.899 may complete
1640 the structural integrity reserve study simultaneously with the
1641 milestone inspection. In no event may the structural integrity
1642 reserve study be completed after December 31, 2026.
1643 8.7. If the milestone inspection required by s. 553.899, or
1644 an inspection completed for a similar local requirement, was
1645 performed within the past 5 years and meets the requirements of
1646 this paragraph, such inspection may be used in place of the
1647 visual inspection portion of the structural integrity reserve
1648 study.
1649 9. If the association completes a milestone inspection
1650 required by s. 553.899, or an inspection completed for a similar
1651 local requirement, the association may delay performance of a
1652 required structural integrity reserve study for no more than 2
1653 budget years to permit the association to focus its financial
1654 resources on the completing the repair and maintenance
1655 recommendations of the milestone inspection.
1656 10.8. If the officers or directors of an association
1657 willfully and knowingly fail to complete a structural integrity
1658 reserve study pursuant to this paragraph, such failure is a
1659 breach of an officer’s and director’s fiduciary relationship to
1660 the unit owners under s. 719.104(9).
1661 11.9. Within 45 days after receiving the structural
1662 integrity reserve study, the association must distribute a copy
1663 of the study to each unit owner or deliver to each unit owner a
1664 notice that the completed study is available for inspection and
1665 copying upon a written request. Distribution of a copy of the
1666 study or notice must be made by United States mail or personal
1667 delivery at the mailing address, property address, or any other
1668 address of the owner provided to fulfill the association’s
1669 notice requirements under this chapter, or by electronic
1670 transmission to the e-mail address or facsimile number provided
1671 to fulfill the association’s notice requirements to unit owners
1672 who previously consented to receive notice by electronic
1673 transmission.
1674 12.10. Within 45 days after receiving the structural
1675 integrity reserve study, the association must provide the
1676 division with a statement indicating that the study was
1677 completed and that the association provided or made available
1678 such study to each unit owner in accordance with this section.
1679 Such statement must be provided to the division in the manner
1680 established by the division using a form posted on the
1681 division’s website.
1682 13. The division shall adopt by rule the form for the
1683 structural integrity reserve study in coordination with the
1684 Florida Building Commission.
1685 Section 8. Paragraphs (c) and (d) of subsection (2) of
1686 section 719.503, Florida Statutes, are amended, and paragraph
1687 (d) of subsection (1) of that section is reenacted, to read:
1688 719.503 Disclosure prior to sale.—
1689 (1) DEVELOPER DISCLOSURE.—
1690 (d) Milestone inspection, turnover inspection report, or
1691 structural integrity reserve study.—If the association is
1692 required to have completed a milestone inspection as described
1693 in s. 553.899, a turnover inspection report for a turnover
1694 inspection performed on or after July 1, 2023, or a structural
1695 integrity reserve study, and the association has not completed
1696 the milestone inspection, the turnover inspection report, or the
1697 structural integrity reserve study, each contract entered into
1698 after December 31, 2024, for the sale of a residential unit
1699 shall contain in conspicuous type a statement indicating that
1700 the association is required to have a milestone inspection, a
1701 turnover inspection report, or a structural integrity reserve
1702 study and has not completed such inspection, report, or study,
1703 as appropriate. If the association is not required to have a
1704 milestone inspection as described in s. 553.899 or a structural
1705 integrity reserve study, each contract entered into after
1706 December 31, 2024, for the sale of a residential unit shall
1707 contain in conspicuous type a statement indicating that the
1708 association is not required to have a milestone inspection or a
1709 structural integrity reserve study, as appropriate. If the
1710 association has completed a milestone inspection as described in
1711 s. 553.899, a turnover inspection report for a turnover
1712 inspection performed on or after July 1, 2023, or a structural
1713 integrity reserve study, each contract entered into after
1714 December 31, 2024, for the sale of a residential unit shall
1715 contain in conspicuous type:
1716 1. A clause which states: THE BUYER HEREBY ACKNOWLEDGES
1717 THAT BUYER HAS BEEN PROVIDED A CURRENT COPY OF THE INSPECTOR
1718 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1719 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1720 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1721 719.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1722 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1723 RESERVE STUDY DESCRIBED IN SECTIONS 719.103(24) AND
1724 719.106(1)(k), FLORIDA STATUTES, IF APPLICABLE, MORE THAN 15
1725 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, PRIOR TO
1726 EXECUTION OF THIS CONTRACT; and
1727 2. A clause which states: THIS AGREEMENT IS VOIDABLE BY
1728 BUYER BY DELIVERING WRITTEN NOTICE OF THE BUYER’S INTENTION TO
1729 CANCEL WITHIN 15 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL
1730 HOLIDAYS, AFTER THE DATE OF EXECUTION OF THIS AGREEMENT BY THE
1731 BUYER AND RECEIPT BY BUYER OF A CURRENT COPY OF THE INSPECTOR
1732 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1733 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1734 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1735 719.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1736 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1737 RESERVE STUDY DESCRIBED IN SECTIONS 719.103(24) AND
1738 719.106(1)(k), FLORIDA STATUTES, IF APPLICABLE. ANY PURPORTED
1739 WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO EFFECT. BUYER
1740 MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF NOT MORE THAN 15
1741 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, AFTER
1742 THE BUYER RECEIVES A CURRENT COPY OF THE INSPECTOR-PREPARED
1743 SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED IN
1744 SECTION 553.899, FLORIDA STATUTES; A COPY OF THE TURNOVER
1745 INSPECTION REPORT DESCRIBED IN SECTION 719.301(4)(p) AND (q),
1746 FLORIDA STATUTES; OR A COPY OF THE ASSOCIATION’S MOST RECENT
1747 STRUCTURAL INTEGRITY RESERVE STUDY DESCRIBED IN SECTIONS
1748 719.103(24) AND 719.106(1)(k), FLORIDA STATUTES, IF REQUESTED IN
1749 WRITING. BUYER’S RIGHT TO VOID THIS AGREEMENT SHALL TERMINATE AT
1750 CLOSING.
1751
1752 A contract that does not conform to the requirements of this
1753 paragraph is voidable at the option of the purchaser prior to
1754 closing.
1755 (2) NONDEVELOPER DISCLOSURE.—
1756 (c) Each contract entered into after July 1, 1992, for the
1757 resale of an interest in a cooperative shall contain in
1758 conspicuous type either:
1759 1. A clause which states: THE BUYER HEREBY ACKNOWLEDGES
1760 THAT BUYER HAS BEEN PROVIDED A CURRENT COPY OF THE ARTICLES OF
1761 INCORPORATION OF THE ASSOCIATION, BYLAWS, RULES OF THE
1762 ASSOCIATION, AND THE QUESTION AND ANSWER SHEET MORE THAN 15 3
1763 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, PRIOR TO
1764 EXECUTION OF THIS CONTRACT; or
1765 2. A clause which states: THIS AGREEMENT IS VOIDABLE BY
1766 BUYER BY DELIVERING WRITTEN NOTICE OF THE BUYER’S INTENTION TO
1767 CANCEL WITHIN 15 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL
1768 HOLIDAYS, AFTER THE DATE OF EXECUTION OF THIS AGREEMENT BY THE
1769 BUYER AND RECEIPT BY BUYER OF A CURRENT COPY OF THE ARTICLES OF
1770 INCORPORATION, BYLAWS, AND RULES OF THE ASSOCIATION, AND
1771 QUESTION AND ANSWER SHEET, IF SO REQUESTED IN WRITING. ANY
1772 PURPORTED WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO
1773 EFFECT. BUYER MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF
1774 NOT MORE THAN 15 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL
1775 HOLIDAYS, AFTER THE BUYER RECEIVES THE ARTICLES OF
1776 INCORPORATION, BYLAWS, RULES, AND QUESTION AND ANSWER SHEET, IF
1777 REQUESTED IN WRITING. BUYER’S RIGHT TO VOID THIS AGREEMENT SHALL
1778 TERMINATE AT CLOSING.
1779
1780 A contract that does not conform to the requirements of this
1781 paragraph is voidable at the option of the purchaser prior to
1782 closing.
1783 (d) If the association is required to have completed a
1784 milestone inspection as described in s. 553.899, a turnover
1785 inspection report for a turnover inspection performed on or
1786 after July 1, 2023, or a structural integrity reserve study, and
1787 the association has not completed the milestone inspection, the
1788 turnover inspection report, or the structural integrity reserve
1789 study, each contract entered into after December 31, 2024, for
1790 the sale of a residential unit shall contain in conspicuous type
1791 a statement indicating that the association is required to have
1792 a milestone inspection, a turnover inspection report, or a
1793 structural integrity reserve study and has not completed such
1794 inspection, report, or study, as appropriate. If the association
1795 is not required to have a milestone inspection as described in
1796 s. 553.899 or a structural integrity reserve study, each
1797 contract entered into after December 31, 2024, for the sale of a
1798 residential unit shall contain in conspicuous type a statement
1799 indicating that the association is not required to have a
1800 milestone inspection or a structural integrity reserve study, as
1801 appropriate. If the association has completed a milestone
1802 inspection as described in s. 553.899, a turnover inspection
1803 report for a turnover inspection performed on or after July 1,
1804 2023, or a structural integrity reserve study, each contract
1805 entered into after December 31, 2024, for the resale of a
1806 residential unit shall contain in conspicuous type:
1807 1. A clause which states: THE BUYER HEREBY ACKNOWLEDGES
1808 THAT BUYER HAS BEEN PROVIDED A CURRENT COPY OF THE INSPECTOR
1809 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1810 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1811 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1812 719.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1813 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1814 RESERVE STUDY DESCRIBED IN SECTIONS 719.103(24) AND
1815 719.106(1)(k), FLORIDA STATUTES, IF APPLICABLE, MORE THAN 15 3
1816 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, PRIOR TO
1817 EXECUTION OF THIS CONTRACT; and
1818 2. A clause which states: THIS AGREEMENT IS VOIDABLE BY
1819 BUYER BY DELIVERING WRITTEN NOTICE OF THE BUYER’S INTENTION TO
1820 CANCEL WITHIN 15 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL
1821 HOLIDAYS, AFTER THE DATE OF EXECUTION OF THIS AGREEMENT BY THE
1822 BUYER AND RECEIPT BY BUYER OF A CURRENT COPY OF THE INSPECTOR
1823 PREPARED SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED
1824 IN SECTION 553.899, FLORIDA STATUTES, IF APPLICABLE; A COPY OF
1825 THE TURNOVER INSPECTION REPORT DESCRIBED IN SECTION
1826 719.301(4)(p) AND (q), FLORIDA STATUTES, IF APPLICABLE; AND A
1827 COPY OF THE ASSOCIATION’S MOST RECENT STRUCTURAL INTEGRITY
1828 RESERVE STUDY DESCRIBED IN SECTIONS 719.103(24) AND
1829 719.106(1)(k), FLORIDA STATUTES, IF APPLICABLE. ANY PURPORTED
1830 WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO EFFECT. BUYER
1831 MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF NOT MORE THAN 15
1832 3 DAYS, EXCLUDING SATURDAYS, SUNDAYS, AND LEGAL HOLIDAYS, AFTER
1833 THE BUYER RECEIVES A CURRENT COPY OF THE INSPECTOR-PREPARED
1834 SUMMARY OF THE MILESTONE INSPECTION REPORT AS DESCRIBED IN
1835 SECTION 553.899, FLORIDA STATUTES; A COPY OF THE TURNOVER
1836 INSPECTION REPORT DESCRIBED IN SECTION 719.301(4)(p) AND (q),
1837 FLORIDA STATUTES; OR A COPY OF THE ASSOCIATION’S MOST RECENT
1838 STRUCTURAL INTEGRITY RESERVE STUDY DESCRIBED IN SECTIONS
1839 719.103(24) AND 719.106(1)(k), FLORIDA STATUTES, IF REQUESTED IN
1840 WRITING. BUYER’S RIGHT TO VOID THIS AGREEMENT SHALL TERMINATE AT
1841 CLOSING.
1842
1843 A contract that does not conform to the requirements of this
1844 paragraph is voidable at the option of the purchaser prior to
1845 closing.
1846 Section 9. For the purpose of incorporating the amendment
1847 made by this act to section 718.111, Florida Statutes, in a
1848 reference thereto, paragraph (e) of subsection (3) of section
1849 721.13, Florida Statutes, is reenacted to read:
1850 721.13 Management.—
1851 (3) The duties of the managing entity include, but are not
1852 limited to:
1853 (e) Arranging for an annual audit of the financial
1854 statements of the timeshare plan by a certified public
1855 accountant licensed by the Board of Accountancy of the
1856 Department of Business and Professional Regulation, in
1857 accordance with generally accepted auditing standards as defined
1858 by the rules of the Board of Accountancy of the Department of
1859 Business and Professional Regulation. The financial statements
1860 required by this section must be prepared on an accrual basis
1861 using fund accounting, and must be presented in accordance with
1862 generally accepted accounting principles. A copy of the audited
1863 financial statements must be filed with the division for review
1864 and forwarded to the board of directors and officers of the
1865 owners’ association, if one exists, no later than 5 calendar
1866 months after the end of the timeshare plan’s fiscal year. If no
1867 owners’ association exists, each purchaser must be notified, no
1868 later than 5 months after the end of the timeshare plan’s fiscal
1869 year, that a copy of the audited financial statements is
1870 available upon request to the managing entity. Notwithstanding
1871 any requirement of s. 718.111(13) or s. 719.104(4), the audited
1872 financial statements required by this section are the only
1873 annual financial reporting requirements for timeshare
1874 condominiums or timeshare cooperatives.
1875 Section 10. For the purpose of incorporating the amendment
1876 made by this act to section 718.112, Florida Statutes, in
1877 references thereto, paragraph (a) of subsection (7) and
1878 paragraph (c) of subsection (21) of section 718.504, Florida
1879 Statutes, are reenacted to read:
1880 718.504 Prospectus or offering circular.—Every developer of
1881 a residential condominium which contains more than 20
1882 residential units, or which is part of a group of residential
1883 condominiums which will be served by property to be used in
1884 common by unit owners of more than 20 residential units, shall
1885 prepare a prospectus or offering circular and file it with the
1886 Division of Florida Condominiums, Timeshares, and Mobile Homes
1887 prior to entering into an enforceable contract of purchase and
1888 sale of any unit or lease of a unit for more than 5 years and
1889 shall furnish a copy of the prospectus or offering circular to
1890 each buyer. In addition to the prospectus or offering circular,
1891 each buyer shall be furnished a separate page entitled
1892 “Frequently Asked Questions and Answers,” which shall be in
1893 accordance with a format approved by the division and a copy of
1894 the financial information required by s. 718.111. This page
1895 shall, in readable language, inform prospective purchasers
1896 regarding their voting rights and unit use restrictions,
1897 including restrictions on the leasing of a unit; shall indicate
1898 whether and in what amount the unit owners or the association is
1899 obligated to pay rent or land use fees for recreational or other
1900 commonly used facilities; shall contain a statement identifying
1901 that amount of assessment which, pursuant to the budget, would
1902 be levied upon each unit type, exclusive of any special
1903 assessments, and which shall further identify the basis upon
1904 which assessments are levied, whether monthly, quarterly, or
1905 otherwise; shall state and identify any court cases in which the
1906 association is currently a party of record in which the
1907 association may face liability in excess of $100,000; shall
1908 state whether the condominium is created within a portion of a
1909 building or within a multiple parcel building; and which shall
1910 further state whether membership in a recreational facilities
1911 association is mandatory, and if so, shall identify the fees
1912 currently charged per unit type. The division shall by rule
1913 require such other disclosure as in its judgment will assist
1914 prospective purchasers. The prospectus or offering circular may
1915 include more than one condominium, although not all such units
1916 are being offered for sale as of the date of the prospectus or
1917 offering circular. The prospectus or offering circular must
1918 contain the following information:
1919 (7) A description of the recreational and other facilities
1920 that will be used in common with other condominiums, community
1921 associations, or planned developments which require the payment
1922 of the maintenance and expenses of such facilities, directly or
1923 indirectly, by the unit owners. The description shall include,
1924 but not be limited to, the following:
1925 (a) Each building and facility committed to be built and a
1926 summary description of the structural integrity of each building
1927 for which reserves are required pursuant to s. 718.112(2)(g).
1928
1929 Descriptions shall include location, areas, capacities, numbers,
1930 volumes, or sizes and may be stated as approximations or
1931 minimums.
1932 (21) An estimated operating budget for the condominium and
1933 the association, and a schedule of the unit owner’s expenses
1934 shall be attached as an exhibit and shall contain the following
1935 information:
1936 (c) The estimated items of expenses of the condominium and
1937 the association, except as excluded under paragraph (b),
1938 including, but not limited to, the following items, which shall
1939 be stated as an association expense collectible by assessments
1940 or as unit owners’ expenses payable to persons other than the
1941 association:
1942 1. Expenses for the association and condominium:
1943 a. Administration of the association.
1944 b. Management fees.
1945 c. Maintenance.
1946 d. Rent for recreational and other commonly used
1947 facilities.
1948 e. Taxes upon association property.
1949 f. Taxes upon leased areas.
1950 g. Insurance.
1951 h. Security provisions.
1952 i. Other expenses.
1953 j. Operating capital.
1954 k. Reserves for all applicable items referenced in s.
1955 718.112(2)(g).
1956 l. Fees payable to the division.
1957 2. Expenses for a unit owner:
1958 a. Rent for the unit, if subject to a lease.
1959 b. Rent payable by the unit owner directly to the lessor or
1960 agent under any recreational lease or lease for the use of
1961 commonly used facilities, which use and payment is a mandatory
1962 condition of ownership and is not included in the common expense
1963 or assessments for common maintenance paid by the unit owners to
1964 the association.
1965 Section 11. For the purpose of incorporating the amendment
1966 made by this act to section 718.112, Florida Statutes, in
1967 references thereto, paragraph (d) of subsection (1) of section
1968 718.618, Florida Statutes, is reenacted to read:
1969 718.618 Converter reserve accounts; warranties.—
1970 (1) When existing improvements are converted to ownership
1971 as a residential condominium, the developer shall establish
1972 converter reserve accounts for capital expenditures and deferred
1973 maintenance, or give warranties as provided by subsection (6),
1974 or post a surety bond as provided by subsection (7). The
1975 developer shall fund the converter reserve accounts in amounts
1976 calculated as follows:
1977 (d) In addition to establishing the reserve accounts
1978 specified above, the developer shall establish those other
1979 reserve accounts required by s. 718.112(2)(f), and shall fund
1980 those accounts in accordance with the formula provided therein.
1981 The vote to waive or reduce the funding or reserves required by
1982 s. 718.112(2)(f) does not affect or negate the obligations
1983 arising under this section.
1984 Section 12. For the purpose of incorporating the amendment
1985 made by this act to sections 718.111 and 718.112, Florida
1986 Statutes, in references thereto, paragraphs (a) and (v) of
1987 subsection (1) of section 718.501, Florida Statutes, are
1988 reenacted to read:
1989 718.501 Authority, responsibility, and duties of Division
1990 of Florida Condominiums, Timeshares, and Mobile Homes.—
1991 (1) The division may enforce and ensure compliance with
1992 this chapter and rules relating to the development,
1993 construction, sale, lease, ownership, operation, and management
1994 of residential condominium units and complaints related to the
1995 procedural completion of milestone inspections under s. 553.899.
1996 In performing its duties, the division has complete jurisdiction
1997 to investigate complaints and enforce compliance with respect to
1998 associations that are still under developer control or the
1999 control of a bulk assignee or bulk buyer pursuant to part VII of
2000 this chapter and complaints against developers, bulk assignees,
2001 or bulk buyers involving improper turnover or failure to
2002 turnover, pursuant to s. 718.301. However, after turnover has
2003 occurred, the division has jurisdiction to investigate
2004 complaints related only to:
2005 (a)1. Procedural aspects and records relating to financial
2006 issues, including annual financial reporting under s.
2007 718.111(13); assessments for common expenses, fines, and
2008 commingling of reserve and operating funds under s. 718.111(14);
2009 use of debit cards for unintended purposes under s. 718.111(15);
2010 the annual operating budget and the allocation of reserve funds
2011 under s. 718.112(2)(f); financial records under s.
2012 718.111(12)(a)11.; and any other record necessary to determine
2013 the revenues and expenses of the association.
2014 2. Elections, including election and voting requirements
2015 under s. 718.112(2)(b) and (d), recall of board members under s.
2016 718.112(2)(l), electronic voting under s. 718.128, and elections
2017 that occur during an emergency under s. 718.1265(1)(a).
2018 3. The maintenance of and unit owner access to association
2019 records under s. 718.111(12).
2020 4. The procedural aspects of meetings, including unit owner
2021 meetings, quorums, voting requirements, proxies, board of
2022 administration meetings, and budget meetings under s.
2023 718.112(2).
2024 5. The disclosure of conflicts of interest under ss.
2025 718.111(1)(a) and 718.3027, including limitations contained in
2026 s. 718.111(3)(f).
2027 6. The removal of a board director or officer under ss.
2028 718.111(1)(a) and (15) and 718.112(2)(p) and (q).
2029 7. The procedural completion of structural integrity
2030 reserve studies under s. 718.112(2)(g).
2031 8. Any written inquiries by unit owners to the association
2032 relating to such matters, including written inquiries under s.
2033 718.112(2)(a)2.
2034 (v) The division shall submit to the Governor, the
2035 President of the Senate, the Speaker of the House of
2036 Representatives, and the chairs of the legislative
2037 appropriations committees an annual report that includes, but
2038 need not be limited to, the number of training programs provided
2039 for condominium association board members and unit owners, the
2040 number of complaints received by type, the number and percent of
2041 complaints acknowledged in writing within 30 days and the number
2042 and percent of investigations acted upon within 90 days in
2043 accordance with paragraph (n), and the number of investigations
2044 exceeding the 90-day requirement. The annual report must also
2045 include an evaluation of the division’s core business processes
2046 and make recommendations for improvements, including statutory
2047 changes. After December 31, 2024, the division must include a
2048 list of the associations that have completed the structural
2049 integrity reserve study required under s. 718.112(2)(g). The
2050 report shall be submitted by September 30 following the end of
2051 the fiscal year.
2052 Section 13. For the purpose of incorporating the amendment
2053 made by this act to sections 718.111, 718.112, and 718.503,
2054 Florida Statutes, in references thereto, subsections (1) and (3)
2055 of section 718.706, Florida Statutes, are reenacted to read:
2056 718.706 Specific provisions pertaining to offering of units
2057 by a bulk assignee or bulk buyer.—
2058 (1) Before offering more than seven units in a single
2059 condominium for sale or for lease for a term exceeding 5 years,
2060 a bulk assignee or a bulk buyer must file the following
2061 documents with the division and provide such documents to a
2062 prospective purchaser or tenant:
2063 (a) An updated prospectus or offering circular, or a
2064 supplement to the prospectus or offering circular, filed by the
2065 original developer prepared in accordance with s. 718.504, which
2066 must include the form of contract for sale and for lease in
2067 compliance with s. 718.503(2);
2068 (b) An updated Frequently Asked Questions and Answers
2069 sheet;
2070 (c) The executed escrow agreement if required under s.
2071 718.202; and
2072 (d) The financial information required by s. 718.111(13).
2073 However, if a financial information report did not exist before
2074 the acquisition of title by the bulk assignee or bulk buyer, and
2075 if accounting records that permit preparation of the required
2076 financial information report for that period cannot be obtained
2077 despite good faith efforts by the bulk assignee or the bulk
2078 buyer, the bulk assignee or bulk buyer is excused from the
2079 requirement of this paragraph. However, the bulk assignee or
2080 bulk buyer must include in the purchase contract the following
2081 statement in conspicuous type:
2082
2083 ALL OR A PORTION OF THE FINANCIAL INFORMATION REPORT
2084 REQUIRED UNDER S. 718.111(13) FOR THE TIME PERIOD
2085 BEFORE THE SELLER’S ACQUISITION OF THE UNIT IS NOT
2086 AVAILABLE OR CANNOT BE OBTAINED DESPITE THE GOOD FAITH
2087 EFFORTS OF THE SELLER.
2088
2089 (3) A bulk assignee, while in control of the board of
2090 administration of the association, may not authorize, on behalf
2091 of the association:
2092 (a) The waiver of reserves or the reduction of funding of
2093 the reserves pursuant to s. 718.112(2)(f)2., unless approved by
2094 a majority of the voting interests not controlled by the
2095 developer, bulk assignee, and bulk buyer; or
2096 (b) The use of reserve expenditures for other purposes
2097 pursuant to s. 718.112(2)(f)3., unless approved by a majority of
2098 the voting interests not controlled by the developer, bulk
2099 assignee, and bulk buyer.
2100 Section 14. For the purpose of incorporating the amendment
2101 made by this act to section 719.106, Florida Statutes, in a
2102 reference thereto, subsection (24) of section 719.103, Florida
2103 Statutes, is reenacted to read:
2104 719.103 Definitions.—As used in this chapter:
2105 (24) “Structural integrity reserve study” means a study of
2106 the reserve funds required for future major repairs and
2107 replacement of the cooperative property performed as required
2108 under s. 719.106(1)(k).
2109 Section 15. For the purpose of incorporating the amendment
2110 made by this act to section 719.106, Florida Statutes, in a
2111 reference thereto, subsection (1) of section 719.501, Florida
2112 Statutes, is reenacted to read:
2113 719.501 Powers and duties of Division of Florida
2114 Condominiums, Timeshares, and Mobile Homes.—
2115 (1) The Division of Florida Condominiums, Timeshares, and
2116 Mobile Homes of the Department of Business and Professional
2117 Regulation, referred to as the “division” in this part, in
2118 addition to other powers and duties prescribed by chapter 718,
2119 has the power to enforce and ensure compliance with this chapter
2120 and adopted rules relating to the development, construction,
2121 sale, lease, ownership, operation, and management of residential
2122 cooperative units; complaints related to the procedural
2123 completion of the structural integrity reserve studies under s.
2124 719.106(1)(k); and complaints related to the procedural
2125 completion of milestone inspections under s. 553.899. In
2126 performing its duties, the division shall have the following
2127 powers and duties:
2128 (a) The division may make necessary public or private
2129 investigations within or outside this state to determine whether
2130 any person has violated this chapter or any rule or order
2131 hereunder, to aid in the enforcement of this chapter, or to aid
2132 in the adoption of rules or forms hereunder.
2133 (b) The division may require or permit any person to file a
2134 statement in writing, under oath or otherwise, as the division
2135 determines, as to the facts and circumstances concerning a
2136 matter to be investigated.
2137 (c) For the purpose of any investigation under this
2138 chapter, the division director or any officer or employee
2139 designated by the division director may administer oaths or
2140 affirmations, subpoena witnesses and compel their attendance,
2141 take evidence, and require the production of any matter which is
2142 relevant to the investigation, including the existence,
2143 description, nature, custody, condition, and location of any
2144 books, documents, or other tangible things and the identity and
2145 location of persons having knowledge of relevant facts or any
2146 other matter reasonably calculated to lead to the discovery of
2147 material evidence. Upon failure by a person to obey a subpoena
2148 or to answer questions propounded by the investigating officer
2149 and upon reasonable notice to all persons affected thereby, the
2150 division may apply to the circuit court for an order compelling
2151 compliance.
2152 (d) Notwithstanding any remedies available to unit owners
2153 and associations, if the division has reasonable cause to
2154 believe that a violation of any provision of this chapter or
2155 related rule has occurred, the division may institute
2156 enforcement proceedings in its own name against a developer,
2157 association, officer, or member of the board, or its assignees
2158 or agents, as follows:
2159 1. The division may permit a person whose conduct or
2160 actions may be under investigation to waive formal proceedings
2161 and enter into a consent proceeding whereby orders, rules, or
2162 letters of censure or warning, whether formal or informal, may
2163 be entered against the person.
2164 2. The division may issue an order requiring the developer,
2165 association, officer, or member of the board, or its assignees
2166 or agents, to cease and desist from the unlawful practice and
2167 take such affirmative action as in the judgment of the division
2168 will carry out the purposes of this chapter. Such affirmative
2169 action may include, but is not limited to, an order requiring a
2170 developer to pay moneys determined to be owed to a condominium
2171 association.
2172 3. The division may bring an action in circuit court on
2173 behalf of a class of unit owners, lessees, or purchasers for
2174 declaratory relief, injunctive relief, or restitution.
2175 4. The division may impose a civil penalty against a
2176 developer or association, or its assignees or agents, for any
2177 violation of this chapter or related rule. The division may
2178 impose a civil penalty individually against any officer or board
2179 member who willfully and knowingly violates a provision of this
2180 chapter, a rule adopted pursuant to this chapter, or a final
2181 order of the division. The term “willfully and knowingly” means
2182 that the division informed the officer or board member that his
2183 or her action or intended action violates this chapter, a rule
2184 adopted under this chapter, or a final order of the division,
2185 and that the officer or board member refused to comply with the
2186 requirements of this chapter, a rule adopted under this chapter,
2187 or a final order of the division. The division, prior to
2188 initiating formal agency action under chapter 120, shall afford
2189 the officer or board member an opportunity to voluntarily comply
2190 with this chapter, a rule adopted under this chapter, or a final
2191 order of the division. An officer or board member who complies
2192 within 10 days is not subject to a civil penalty. A penalty may
2193 be imposed on the basis of each day of continuing violation, but
2194 in no event shall the penalty for any offense exceed $5,000. The
2195 division shall adopt, by rule, penalty guidelines applicable to
2196 possible violations or to categories of violations of this
2197 chapter or rules adopted by the division. The guidelines must
2198 specify a meaningful range of civil penalties for each such
2199 violation of the statute and rules and must be based upon the
2200 harm caused by the violation, upon the repetition of the
2201 violation, and upon such other factors deemed relevant by the
2202 division. For example, the division may consider whether the
2203 violations were committed by a developer or owner-controlled
2204 association, the size of the association, and other factors. The
2205 guidelines must designate the possible mitigating or aggravating
2206 circumstances that justify a departure from the range of
2207 penalties provided by the rules. It is the legislative intent
2208 that minor violations be distinguished from those which endanger
2209 the health, safety, or welfare of the cooperative residents or
2210 other persons and that such guidelines provide reasonable and
2211 meaningful notice to the public of likely penalties that may be
2212 imposed for proscribed conduct. This subsection does not limit
2213 the ability of the division to informally dispose of
2214 administrative actions or complaints by stipulation, agreed
2215 settlement, or consent order. All amounts collected shall be
2216 deposited with the Chief Financial Officer to the credit of the
2217 Division of Florida Condominiums, Timeshares, and Mobile Homes
2218 Trust Fund. If a developer fails to pay the civil penalty, the
2219 division shall thereupon issue an order directing that such
2220 developer cease and desist from further operation until such
2221 time as the civil penalty is paid or may pursue enforcement of
2222 the penalty in a court of competent jurisdiction. If an
2223 association fails to pay the civil penalty, the division shall
2224 thereupon pursue enforcement in a court of competent
2225 jurisdiction, and the order imposing the civil penalty or the
2226 cease and desist order shall not become effective until 20 days
2227 after the date of such order. Any action commenced by the
2228 division shall be brought in the county in which the division
2229 has its executive offices or in the county where the violation
2230 occurred.
2231 (e) The division may prepare and disseminate a prospectus
2232 and other information to assist prospective owners, purchasers,
2233 lessees, and developers of residential cooperatives in assessing
2234 the rights, privileges, and duties pertaining thereto.
2235 (f) The division has authority to adopt rules pursuant to
2236 ss. 120.536(1) and 120.54 to implement and enforce the
2237 provisions of this chapter.
2238 (g) The division shall establish procedures for providing
2239 notice to an association when the division is considering the
2240 issuance of a declaratory statement with respect to the
2241 cooperative documents governing such cooperative community.
2242 (h) The division shall furnish each association which pays
2243 the fees required by paragraph (2)(a) a copy of this act,
2244 subsequent changes to this act on an annual basis, an amended
2245 version of this act as it becomes available from the Secretary
2246 of State’s office on a biennial basis, and the rules adopted
2247 thereto on an annual basis.
2248 (i) The division shall annually provide each association
2249 with a summary of declaratory statements and formal legal
2250 opinions relating to the operations of cooperatives which were
2251 rendered by the division during the previous year.
2252 (j) The division shall adopt uniform accounting principles,
2253 policies, and standards to be used by all associations in the
2254 preparation and presentation of all financial statements
2255 required by this chapter. The principles, policies, and
2256 standards shall take into consideration the size of the
2257 association and the total revenue collected by the association.
2258 (k) The division shall provide training and educational
2259 programs for cooperative association board members and unit
2260 owners. The training may, in the division’s discretion, include
2261 web-based electronic media and live training and seminars in
2262 various locations throughout the state. The division may review
2263 and approve education and training programs for board members
2264 and unit owners offered by providers and shall maintain a
2265 current list of approved programs and providers and make such
2266 list available to board members and unit owners in a reasonable
2267 and cost-effective manner.
2268 (l) The division shall maintain a toll-free telephone
2269 number accessible to cooperative unit owners.
2270 (m) When a complaint is made to the division, the division
2271 shall conduct its inquiry with reasonable dispatch and with due
2272 regard to the interests of the affected parties. Within 30 days
2273 after receipt of a complaint, the division shall acknowledge the
2274 complaint in writing and notify the complainant whether the
2275 complaint is within the jurisdiction of the division and whether
2276 additional information is needed by the division from the
2277 complainant. The division shall conduct its investigation and
2278 shall, within 90 days after receipt of the original complaint or
2279 timely requested additional information, take action upon the
2280 complaint. However, the failure to complete the investigation
2281 within 90 days does not prevent the division from continuing the
2282 investigation, accepting or considering evidence obtained or
2283 received after 90 days, or taking administrative action if
2284 reasonable cause exists to believe that a violation of this
2285 chapter or a rule of the division has occurred. If an
2286 investigation is not completed within the time limits
2287 established in this paragraph, the division shall, on a monthly
2288 basis, notify the complainant in writing of the status of the
2289 investigation. When reporting its action to the complainant, the
2290 division shall inform the complainant of any right to a hearing
2291 pursuant to ss. 120.569 and 120.57.
2292 (n) The division shall develop a program to certify both
2293 volunteer and paid mediators to provide mediation of cooperative
2294 disputes. The division shall provide, upon request, a list of
2295 such mediators to any association, unit owner, or other
2296 participant in arbitration proceedings under s. 718.1255
2297 requesting a copy of the list. The division shall include on the
2298 list of voluntary mediators only persons who have received at
2299 least 20 hours of training in mediation techniques or have
2300 mediated at least 20 disputes. In order to become initially
2301 certified by the division, paid mediators must be certified by
2302 the Supreme Court to mediate court cases in county or circuit
2303 courts. However, the division may adopt, by rule, additional
2304 factors for the certification of paid mediators, which factors
2305 must be related to experience, education, or background. Any
2306 person initially certified as a paid mediator by the division
2307 must, in order to continue to be certified, comply with the
2308 factors or requirements imposed by rules adopted by the
2309 division.
2310 Section 16. For the purpose of incorporating the amendment
2311 made by this act to section 719.106, Florida Statutes, in
2312 references thereto, paragraph (a) of subsection (7) and
2313 paragraph (c) of subsection (20) of section 719.504, Florida
2314 Statutes, are reenacted to read:
2315 719.504 Prospectus or offering circular.—Every developer of
2316 a residential cooperative which contains more than 20
2317 residential units, or which is part of a group of residential
2318 cooperatives which will be served by property to be used in
2319 common by unit owners of more than 20 residential units, shall
2320 prepare a prospectus or offering circular and file it with the
2321 Division of Florida Condominiums, Timeshares, and Mobile Homes
2322 prior to entering into an enforceable contract of purchase and
2323 sale of any unit or lease of a unit for more than 5 years and
2324 shall furnish a copy of the prospectus or offering circular to
2325 each buyer. In addition to the prospectus or offering circular,
2326 each buyer shall be furnished a separate page entitled
2327 “Frequently Asked Questions and Answers,” which must be in
2328 accordance with a format approved by the division. This page
2329 must, in readable language: inform prospective purchasers
2330 regarding their voting rights and unit use restrictions,
2331 including restrictions on the leasing of a unit; indicate
2332 whether and in what amount the unit owners or the association is
2333 obligated to pay rent or land use fees for recreational or other
2334 commonly used facilities; contain a statement identifying that
2335 amount of assessment which, pursuant to the budget, would be
2336 levied upon each unit type, exclusive of any special
2337 assessments, and which identifies the basis upon which
2338 assessments are levied, whether monthly, quarterly, or
2339 otherwise; state and identify any court cases in which the
2340 association is currently a party of record in which the
2341 association may face liability in excess of $100,000; and state
2342 whether membership in a recreational facilities association is
2343 mandatory and, if so, identify the fees currently charged per
2344 unit type. The division shall by rule require such other
2345 disclosure as in its judgment will assist prospective
2346 purchasers. The prospectus or offering circular may include more
2347 than one cooperative, although not all such units are being
2348 offered for sale as of the date of the prospectus or offering
2349 circular. The prospectus or offering circular must contain the
2350 following information:
2351 (7) A description of the recreational and other facilities
2352 that will be used in common with other cooperatives, community
2353 associations, or planned developments which require the payment
2354 of the maintenance and expenses of such facilities, directly or
2355 indirectly, by the unit owners. The description shall include,
2356 but not be limited to, the following:
2357 (a) Each building and facility committed to be built and a
2358 summary description of the structural integrity of each building
2359 for which reserves are required pursuant to s. 719.106(1)(k).
2360
2361 Descriptions shall include location, areas, capacities, numbers,
2362 volumes, or sizes and may be stated as approximations or
2363 minimums.
2364 (20) An estimated operating budget for the cooperative and
2365 the association, and a schedule of the unit owner’s expenses
2366 shall be attached as an exhibit and shall contain the following
2367 information:
2368 (c) The estimated items of expenses of the cooperative and
2369 the association, except as excluded under paragraph (b),
2370 including, but not limited to, the following items, which shall
2371 be stated as an association expense collectible by assessments
2372 or as unit owners’ expenses payable to persons other than the
2373 association:
2374 1. Expenses for the association and cooperative:
2375 a. Administration of the association.
2376 b. Management fees.
2377 c. Maintenance.
2378 d. Rent for recreational and other commonly used areas.
2379 e. Taxes upon association property.
2380 f. Taxes upon leased areas.
2381 g. Insurance.
2382 h. Security provisions.
2383 i. Other expenses.
2384 j. Operating capital.
2385 k. Reserves for all applicable items referenced in s.
2386 719.106(1)(k).
2387 l. Fee payable to the division.
2388 2. Expenses for a unit owner:
2389 a. Rent for the unit, if subject to a lease.
2390 b. Rent payable by the unit owner directly to the lessor or
2391 agent under any recreational lease or lease for the use of
2392 commonly used areas, which use and payment are a mandatory
2393 condition of ownership and are not included in the common
2394 expense or assessments for common maintenance paid by the unit
2395 owners to the association.
2396 Section 17. This act shall take effect July 1, 2025.
