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ANNUAL MEETING TIPS FOR ASSOCIATIONS

ANNUAL MEETING TIPS FOR ASSOCIATIONS

  • Posted: Oct 02, 2017
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ANNUAL MEETING TIPS FOR ASSOCIATIONS

by Enrolled Agent Steven J. Weil, Ph.D., EA, LCAM, Royale Management Services, Inc.

 

As associations plan their annual meetings, these reminders and specific steps will be useful.

The annual meeting is a membership meeting in which every member can and should participate. Participation comes through properly-made motions, seconds, taking part in the discussion of motions and through voting.

The first order of business he is to appoint the chairperson to run the meeting.  The chairperson can be anyone who the members agree should chair the meeting.  In many associations the board president chairs the meeting; however, this requires approval of the members. Some associations ask their manager or attorney to chair the meeting.  This is acceptable as long as it is approved by the membership.  In large associations having a professional chair the meeting can help to keep it on track and see that the required business gets done properly.

A motion as to who shall chair the meeting can be made by any member of the association.  This motion must be seconded and then voted on by the members present. If the motion is approved by a majority of the member’s present, the chairperson is elected for the meeting.
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Royale Management Services, a registered and licensed community association management corporation in Florida, works with association Boards of Directors throughout South Florida to oversee the daily activities required for proper management, helping to educate them on their responsibilities, duties, and obligations. Royale’s team members are highly trained in all aspects of community association management and customer service to ensure that proper procedures are followed that keep the association in compliance with all of the rules governing elections, budgeting, accounting, operation, collection and assessment. The firm and its president are members of the Community Association Institute (CAI) and the Fort Lauderdale Chamber of Commerce.
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COPING WITH FL H.B. 1237 (2017)

COPING WITH FL H.B. 1237 (2017)

  • Posted: Aug 01, 2017
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COPING WITH FL H.B. 1237 (2017)

by Steven J. Weil, Ph.D., EA, LCAM, Royale Management Services, Inc.

Whenever the Legislature puts new laws on the books, in order to avoid becoming involved in expensive litigation, managers and board members are obliged to sort out what it all means along with what steps should be taken to address the real meaning, terms and conditions that the courts and judges conclude were the Legislature’s intent.

Florida’s Governor signed Florida House Bill 1237 (2017) into law on June 26, 2017.  The legislation went into effect on July 1, 2017 and added several requirements and prohibitions to the Florida Condominium Act (Chapter 718).

For example, HB 1237, now the law of the land in Florida, states, “Board members may serve 2-year terms if permitted by the bylaws or articles of incorporation. a board member may not serve more than four consecutive 2-year terms, unless approved by an affirmative vote of two-thirds of the total voting interests of the association.” The law also includes an exception if there are not enough eligible candidates to fill all board positions which allows current board members to continue beyond the otherwise prescribed period.

What is yet to be determined is whether this means a board member may serve no more than eight one-year terms, or, if association rules limit terms to one year, the four-term limitation still applies? Other questions still left unanswered include: When do these terms start? Is the law to be enforced retroactively, or are board members prior terms excluded from the new rule?

Another new rule states that a condo board member, despite good intentions, could be subject to penalties for violation of this caveat:  “An association may not employ or contract with any service provider that is owned or operated by a board member or any person who has a financial relationship with a board member.”  Under a strict interpretation of this update to the law, if a board member runs a pool service and is taking care of the association’s pool maintenance for only the cost of chemicals, that board member could end up facing criminal penalties for trying to help out.

Conflicts of interest (such as a board member providing a proposal from a company they are affiliated with) may have long existed, and while board members always should have abstained from any vote where it could be perceived that they had a financial conflict of interest, it could now be a criminal offense.

This is not the only place a condo officer, director or manager could find themselves facing the threat of criminal penalties.  While we all know, or at least should know, kickbacks of any kind are wrong, often accusations made by a unit owner are not grounded in reality and instead are based on little more than spite and mistrust.

However, The updated Florida Statute 718.111 now reads “[A]n officer, director, or manager may not solicit, offer to accept, or accept any thing or service of value or kickback for which consideration has not been provided for his or her own benefit or that of his or her immediate family, from any person providing or proposing to provide goods or services to the association. Any such officer, director, or manager who knowingly so solicits, offers to accept, or accepts any thing or service of value or kickback is subject to a civil penalty pursuant to s. 718.501(1)(d) and, if applicable, a criminal penalty.”

The updated statute goes on to require that an officer or director who is charged with certain crimes (primarily crimes of dishonest character) shall be removed from office and provides requirements for filling the vacancy left by any such removal. The silver lining here is that you have to be charged with a crime before you can be removed, a mere accusation is not enough.

Will these and other provisions that have been added to the law make it even more difficult to find volunteers who are willing to serve as board members? No one really knows yet. What we do know is, it will probably take years for the legislature and the courts to sort this new law out.  We also know that those who serve on our boards of directors are most often well-meaning volunteers who want to do the right thing and serve their fellow owners.  All we can do is hope that none of these changes make it harder to get these good people to serve, and the law works as intended keeping those with a self-serving agenda from throwing their hat in the ring.

We are not attorneys, and anything said here should not be construed as legal advice. This article is purely for educational purposes, with the goal of helping associations better understand current updates to the law. Royale Management Services team members are Licensed Community Association Managers (LCAM) who work with associations to manage, to navigate and to comply with the law.  As you can see, these changes raise several questions, and you can be sure that until these issues are addressed by a court, no one will really know the correct answers. Nevertheless, it is always advisable to seek legal counsel if an issue arises.

SFPMA MEMBER - Find us on the Members Directory
Royale Management Services, a registered and licensed community association management corporation in Florida, works with association Boards of Directors throughout South Florida to oversee the daily activities required for proper management, helping to educate them on their responsibilities, duties, and obligations. Royale’s team members are highly trained in all aspects of community association management and customer service to ensure that proper procedures are followed that keep the association in compliance with all of the rules governing elections, budgeting, accounting, operation, collection and assessment. The firm and its president are members of the Community Association Institute (CAI) and the Fort Lauderdale Chamber of Commerce.
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SUMMER IS HERE: GRILLING RULE VIOLATORS RISK FINES/IMPRISONMENT

SUMMER IS HERE: GRILLING RULE VIOLATORS RISK FINES/IMPRISONMENT

  • Posted: Jun 25, 2017
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SUMMER IS HERE:  GRILLING RULE VIOLATORS RISK FINES/IMPRISONMENT

by Steven J. Weil, Ph.D., EA, LCAM, Royale Management Services, Inc.

The Florida Fire Prevention Code (FFPC) prohibits cooking, using or storing gas or charcoal grills on balconies.   This prohibition also includes fire pits and any other use of fire or flame devices.

The Code also prohibits the storage or use of liquid propane (L.P.) gas in quantities greater than one pound above the first floor in any apartment or condominium. Thus, L.P. gas grills cannot be stored on a balcony. It is important to note that neither can L.P. gas cylinders be stored inside the residential unit or anywhere above the first floor.

Electric grills had been permitted in years past, but the FFPC was amended, effective December 31, 2011, to prohibit their use as well.  The current regulation provides that no hibachi, grill, or other similar devices used for cooking, heating, or any other purposes can be used or kindled on any balcony, under any overhanging portion, or within ten feet of any structure (other than one- and two- family dwellings).  A subsequent amendment in 2014 also prohibited storage of these items.

The only exception to this rule is that listed equipment permanently installed in accordance with its listing, applicable codes, and manufacturer’s instructions may be permitted.

Smoking, while not prohibited by law, also can be regulated under individual association rules.

What enforcement action will be taken for violators?

The local enforcement procedures and penalties for failure to comply with the Florida Fire Prevention Code, or the Uniform Fire Safety Standards, are found in Broward County Local Amendments to the Florida Fire Prevention F-101.4.

The ordinance states that violators of the fire code may be prosecuted in the same manner as misdemeanors; and, upon conviction, they may be punished by a fine not to exceed $500.00 or by imprisonment in the County Jail not to exceed 60 days or both.

The ordinance also states that fire inspectors may issue civil citations to violators. A separate citation may be given for each violation, and each day that a violation continues is a separate offense. If the citation is not contested the penalty is $50.00, plus court costs of $8.00. If a violator chooses to contest the citation and is convicted, the judge may impose a penalty up to $500.00 plus court costs for each violation.

Safety Tips from the National Fire Protection Association

Don’t let fire make your summer memorable for the wrong reasons.  The National Fire Protection Association offers these grilling safety tips:

  • Propane and charcoal BBQ grills should only be used outdoors.
  • The grill should be placed well away from the home, deck railings and out from under eaves and overhanging branches.
  • Keep children and pets away from the grill area.
  • Keep your grill clean by removing grease or fat buildup from the grills and in trays below the grill.
  • Never leave your grill unattended.

It pays to be safe at all times. Protect yourself, your neighbors and your property.

SFPMA MEMBER - Find us on the Members Directory
Royale Management Services, a registered and licensed community association management corporation in Florida, works with association Boards of Directors throughout South Florida to oversee the daily activities required for proper management, helping to educate them on their responsibilities, duties, and obligations. Royale’s team members are highly trained in all aspects of community association management and customer service to ensure that proper procedures are followed that keep the association in compliance with all of the rules governing elections, budgeting, accounting, operation, collection and assessment. The firm and its president are members of the Community Association Institute (CAI) and the Fort Lauderdale Chamber of Commerce.
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HOW TO KEEP MONTHLY ASSOCIATION MAINTENANCE FEES LOW

HOW TO KEEP MONTHLY ASSOCIATION MAINTENANCE FEES LOW

  • Posted: Jun 25, 2017
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HOW TO KEEP MONTHLY ASSOCIATION MAINTENANCE FEES LOW

by Enrolled Agent Steven J. Weil, Ph.D., EA, LCAM, Royale Management Services, Inc.

The answer to keeping association maintenance fees low is NOT to defer necessary maintenance or waiving reserves.  To keep postponing repairs is an act of sheer folly.  It is simply an artificial way to keep maintenance fees low that often backfires when the piper finally has to be paid by a special assessment.

The only thing owners hate more than a maintenance fee increase is a special assessment that becomes necessary because the budget does not adequately cover the ongoing operating and maintenance costs.

As a reminder, there are two parts to every budget: the operating budget and the reserve budget.

  • The operating budget should include all necessary regular and recurring expenses that are expected in the coming year, no matter how large or small, such as repairs, maintenance, up keep, payroll, utilities, supplies, insurance and administrative costs.
  • The reserves are designed to accumulate funds for replacement and renovation of major building systems and components that wear out over time. Statutes make it mandatory that reserve budgets include estimated expenditures for roof replacement, building painting and pavement resurfacing at a minimum.

What should go into a reserve budget?  Aside from what the law requires, a good reserve budget also covers other large capital items that will wear out and need to be replaced over the life of the association, such as elevators, windows, common area air conditioners, docks, generators, balconies, et al.  Other common area reserve items might include a pool upgrade, clubhouse renovation, landscaping and other amenities.

The tricky part of the budgeting process is to balance what is required with the often competing interests of those who want the lowest possible maintenance increase with those who are willing to pay more for better services, better amenities or other improvements.   The board is charged with the upkeep maintenance and operation of the association and amenities as provided for in the governing documents. Any change to what is provided for in the governing documents should be approved by an owner vote. This includes both increases and decreases in services and changes to facilities.

Projected estimates for the reserve budget should take into consideration the cost to replace each item, prorated over the years of its estimated life.

A common mistake in estimating this value is the failure to take into account the rise in replacement costs that occurs over time.  Cost estimates as well as remaining useful life should be evaluated annually. Reserve planning can be done with the assistance of association vendors, or a professional engineer could be hired to perform a Reserve Study.

Some of the costs of running an association can be managed.  Controllable expenses — those over which the board and or management have some control as to the amount and timing — include accounting, bank fees, repairs, supplies, office expense, labor costs, preventive maintenance, management, legal, landscaping and janitorial.

Over the years, however, non-controllable expenses have become the largest part of most association budgets.  They include utilities, contract services, electric, water, garbage, cable, loan payments, licenses, fees and insurance (property, liability, wind and Directors & Officers). Although boards and management work hard to keep these costs as low as possible, it is often difficult or even impossible to get competitive bids for such items as insurance. The costs of utilities and water are often controlled by monopolies or governments; and while conservation can help, it does not eliminate or substantially reduce these costs in the short run. Long term contracts may also lock in such things as elevator maintenance costs, cable TV, and other expenses.

In addition to the increases in these expenses, over the years as association property ages, the cost of maintaining it increases. While putting off maintenance may help cash flow and reduce expenses today, it also means that those expenses will be higher down the road.

Reserve funds cannot be used for purposes other than those intended without a majority vote of approval by the owners in advance. Thus, there is sometimes a reluctance to list in the reserve budget certain capital items that might be considered non-essential and could be postponed.  This can be a mistake, forcing a special assessment when these capital items need to be replaced.

It’s best to keep in mind that one good way to maintain property values is to ensure that the association has a reserve budget that covers necessary renovation and replacement of major components and assets and that the reserve budget is properly reviewed and funded each year.  Under Florida law, condominium associations are required to include a “fully funded” reserve schedule in the proposed budget and to fully fund reserves unless they are waived or reduced by a vote of the owners.

 

SFPMA MEMBER - Find us on the Members Directory
Royale Management Services, a registered and licensed community association management corporation in Florida, works with association Boards of Directors throughout South Florida to oversee the daily activities required for proper management, helping to educate them on their responsibilities, duties, and obligations. Royale’s team members are highly trained in all aspects of community association management and customer service to ensure that proper procedures are followed that keep the association in compliance with all of the rules governing elections, budgeting, accounting, operation, collection and assessment. The firm and its president are members of the Community Association Institute (CAI) and the Fort Lauderdale Chamber of Commerce.
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FREE CONDO BOARD CERTIFICATION CLASSES AND PROPERTY MANAGEMENT SEMINARS

FREE CONDO BOARD CERTIFICATION CLASSES AND PROPERTY MANAGEMENT SEMINARS

  • Posted: May 30, 2017
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ROYALE MANAGEMENT SERVICES, FT. LAUDERDALE, HOLDS FREE CONDO BOARD CERTIFICATION CLASSES AND PROPERTY MANAGEMENT SEMINARS

Fort Lauderdale, May 30, 2017 — A series of free certification classes for condo Board members as well as educational seminars for Board members of condos, homeowners associations and co-ops take place on Monday evenings.  All sessions are held at the offices of Royale Management Services, 2319 North Andrews Avenue. 

Open to all who register, the Board certification classes and property management seminars are conducted by Steven J. Weil, Ph.D., EA, LCAM, president of the 31-year old Fort Lauderdale property management firm.  Refreshments and networking begin at 5:30 p.m. The seminars follow promptly at 6:00 p.m. and include a Q&A. Space is limited. Reservations may be made by calling 954-563-1269.

Condo Board Certification Classes are held on the second Monday of the month and cover topics such as condo law, fiduciary responsibility, governing documents, official records, financial reporting, budgeting, enforcement, elections, et al. Upcoming dates are:  6/12/2017, 9/11/2017, 10/9/2017, and 11/13/2017.

The Property Management Seminars listed below take place on the third Monday of the month: 

06/19/17       Conducting Meetings & Getting The Work Done

09/18/17       Reading & Using Association Financial Statements

10/16/17       Building a Budget That Works

11/20/17       Condo Elections – Getting It Right

Dr. Weil has appeared on Good Morning America and is frequently quoted by major media.  His bylined articles are regularly published on the South Florida Property Management Association website.  “The Condo Board Certification Classes are designed to help new board members meet the Florida 718.112 Statute requirements for Condo Association Board Members,” Dr. Weil said. “Our seminar goal is prevention — to help keep Board members of condos, HOAs and Co-ops from frequently having to call their attorney.”

ABOUT ROYALE MANAGEMENT SERVICES, INC.

Steven J. and Theresa Weil, each of whom has earned a Ph.D. in Business Administration, are the principals of Fort Lauderdale-based Royale Management Services, Inc. A licensed, full-service Community Association Management (CAM) firm, RMS provides professional residential property management services throughout Broward County, Florida, specializing in management, consulting and accounting for Condominium Associations, Home Owners Associations and Co-Ops.

RMS has a team of 16 full-time employees dedicated to working closely with association Boards to hold down costs while improving the quality of life for their residents. RMS strives to ensure that proper procedures are followed to keep the association in compliance with all of the rules governing elections, budgeting, accounting, operation, collection and assessment. The work includes educating board members on the responsibilities, duties, and obligations involved in governing the association.

Royale Management Services, Inc. has been serving South Florida since 1984. Originally founded to provide high-quality management and accounting services for business and individuals, the company expanded into the property management business in 2000. The firm and its president are members of the Community Association Institute (CAI) and the Fort Lauderdale Chamber of Commerce.

CONTACT:
Rose Sexton, Business Communications Services, Deerfield Beach, FL 

Phone: (954) 480-9906    Email: sextons.r@gmail.com

OR

Steven J. Weil, Ph.D., EA, LCAM

Royale Management Services, Inc., Fort Lauderdale, FL 33311

Phone: (800) 382-1040  Email:  steve@rmsaccounting.com

CHECK OUR MONTHLY CALENDAR OF UPCOMING EVENTS TO FIND THESE AND OTHER EVENTS FOR THE PROPERTY MANAGEMENT INDUSTRY.

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ARE WE TOO COMPLACENT ABOUT HURRICANE PREPARATION?

ARE WE TOO COMPLACENT ABOUT HURRICANE PREPARATION?

  • Posted: Apr 28, 2017
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ARE WE TOO COMPLACENT ABOUT HURRICANE PREPARATION?

Steven J. Weil, president, Royale Management Services

by Enrolled Agent Steven J. Weil, Ph.D., EA, LCAM, president, Royale Management Services, Inc.

It’s likely that we don’t have to react with any great urgency this summer to the long-term threat of sea level rising, but it’s probably a very good idea to think seriously about hurricane preparation right now.

Floridians may have become a bit complacent about hurricanes, knowing that South Florida has not been hit by a major hurricane since 2005.  However, hurricane researchers tell us that the current 11-year drought in the Sunshine State is almost twice as long as the previous one of six years’ duration (from 1979-1985).  They warn that it’s just a matter of time before storms start coming this way again.

Association residents have some options, depending upon the strength of a storm.

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SFPMA MEMBER - Find us on the Members Directory
Royale Management Services, a registered and licensed community association management corporation in Florida, works with association Boards of Directors throughout South Florida to oversee the daily activities required for proper management, helping to educate them on their responsibilities, duties, and obligations. Royale’s team members are highly trained in all aspects of community association management and customer service to ensure that proper procedures are followed that keep the association in compliance with all of the rules governing elections, budgeting, accounting, operation, collection and assessment.
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