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Changes To HOA Laws Encourage Transparency For Owners

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In the last few years, Florida’s legislature has enacted several new measures designed to make real estate transactions more transparent, particularly in homeowners’ associations (HOAs). Two more are set to come into effect later in 2024, and both owners and HOA board members should familiarize themselves with their requirements. One has to do with easing the requirements on sales, while the other requires HOAs to incorporate, which in itself institutes new rules for fiduciary duty and other legal actions.

A Year Of Reforms

Florida’s legislature has made concerted efforts toward reforming the laws surrounding community associations, working to balance the interests of the board with those of unit owners simply seeking to enjoy their property. For example, the so-called “Homeowners’ Association Bill of Rights” imposed more stringent ethical standards over conflicts of interest and kickbacks, elucidated the requirements for proper record-keeping, and many other rules designed to level the proverbial playing field.

Other regulations that took effect in 2023 include those permitting an increased level of autonomy for parcel owners in terms of what they can and cannot store outside as long as it is not visible from the front of the parcel, and clarifying a statute of repose vs a statute of limitations, which can materially affect construction dispute cases. A law was also passed to effectively ban requiring proof of COVID-19 vaccinations and mask wearing by businesses, but this has less bearing on the day-to-day operations of HOAs, particularly since disabled owners need not be excluded from public life in most associations due to virtual meeting options.

Laws Taking Effect Promote Transparency

The two laws set to take effect in July 2024 both continue in the same vein, with one attempting to smooth out potential roadblocks for the sale of units in community associations, and the other mandates that all HOAs incorporate (removing previous exceptions). With that incorporation, higher standards of conduct for board members are also imposed, particularly in their capacity as fiduciaries for the best interests of their unit owners. Board members have a high duty of care, but as corporate officers, the duty is even more strict.

House Bill 979, meanwhile, establishes clear guidelines for the issuance of estoppel certificates, which are documents signed by tenants that confirm the details of their lease agreements with their association. Historically, some community associations have charged a fee for the issuance of this kind of certificate, but this law would either ban or strictly regulate that practice. Without an estoppel certificate, certain real estate transactions cannot happen, and restricting that based solely on the wish to collect a fee is contrary to public policy.

Call A Tampa Community Association Attorney

It remains to be seen as to how the new laws will affect interactions between HOAs and their owners, but it is the job of a Tampa community association attorney to be aware of the potential ramifications. Attorney Alicia Seward and the Seward Law Office have handled many of these types of cases, and will work hard on yours. Contact our office today to schedule a consultation.

Source:

flsenate.gov/Committees/billsummaries/2023/html/3113

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