Comments: Comments Off on “Condo Craze & HOA’s” Watch us live on YouTube with Eric Glazer Sundays.
“Condo Craze & HOA’s”
Watch us live on YouTube with Eric Glazer
Sunday 11am
Eric Glazer graduated from the University of Miami School of Law in 1992 after receiving a B.A. from NYU. He has practiced community association law for more than 2 decades and is the owner of Glazer and Sachs, P.A. a five attorney law firm with offices in Fort Lauderdale and Orlando.
Eric is Board certified by The Florida Bar in Condominium and Planned Development Law and the first attorney in the State that designed a course that certifies both condominium and HOA residents as eligible to serve on a Board of Directors and has now certified more than 20,000 Floridians all across the state.
Mr. Glazer is certified as a Circuit Court Mediator by The Florida Supreme Court and has mediated dozens of disputes between associations and unit owners. Eric also devotes significant time to advancing legislation in the best interest of Florida community association members.
For four generations, the name Sarasohn has been synonymous with the highest levels of integrity and expertise in the field of insurance adjusting.
Emmanuel Sarasohn founded his public adjusting business in 1924 in Newark, NJ. His sons, Ira and Roy, grew up in the family business and came on board full time after college and the army.
In 1951, Ira Sarasohn was one of the founding members of the National Association of Public Insurance Adjusters. Ira and Roy would both later serve as president of that esteemed organization.
Ira J. Sarasohn took over the helm of Sarasohn & Company after his father’s passing. In 1970, Stephen Sarasohn joined the firm in NJ, but he settled in Florida a few years later. In 1985, both Ira and Stephen helped found the Florida Association of Public Insurance Adjusters. After 72 years of public adjusting, Ira J. Sarasohn passed away in 2006 with many active files on his desk. In 2018, Bernard Sarasohn joined the firm as a licensed public adjuster.
Stephen Sarasohn is now CEO of Sarasohn & Company and he maintains the same high standards as his predecessors. Sarasohn & Company, Inc. is based in Boca Raton, FL but is licensed to handle claims in other states as well.
Building Claims
In order to properly adjust any claim for damage to a structure, it is important to prepare a detailed repair estimate. Sarasohn & Company will do that on your behalf. Whenever necessary, we will employ the services of architects, engineers, contractors and other independent experts at no additional cost to you.
Full consideration is given to the provisions of your policy, as well as applicable statutes and case law, so as to maximize the recovery. This includes consideration of depreciation, coinsurance, code upgrades, deductibles and any other factors important to a successful adjustment. Sarasohn & Company is also equipped to provide project management for the reconstruction process. Project management is a field used in large construction projects to coordinate the various aspects of the repairs. This service is provided at no additional cost.
Personal Property Losses
All insurance policies require the submission of a complete inventory of both the damaged and undamaged personal property. This includes machinery, trade fixtures, appliances, merchandise inventory, household furnishings, clothing and all other movable property insured under the policy. This coverage also covers improvements and betterments on tenants’ policies, which can be treated several ways for claims purposes.
Sarasohn & Company has on its staff, experienced personnel who are capable of filling these requirements. In addition to listing the property involved, our experts will calculate the replacement cost and actual cash value of each item as well as the repair cost when appropriate. We will determine salvage value, if any, and help arrange for protection of the property from further damage, as required by the policy. Our services can be helpful in documenting your tax loss, if any.
Loss of Income Claims
One of the most complex aspects of your claim involves calculating the loss of income you will suffer as a direct result of damage to real or personal property. Sarasohn’s long term experience has helped to develop a team of forensic accountants who have proven to be outstanding in their ability to adjust claims in a way most favorable to the policyholder. The services of CPA’s and tax attorneys are engaged when necessary, at no additional cost to you.
One of the questions that usually arise in a loss of income claim involves the continuation of payroll during the period of restoration. It is extremely important that a method be established as soon as possible after the loss, to resolve this aspect of the claim. Sarasohn & Company, with its years of experience will assist you with these important decisions. Extra expense coverage can be used creatively to make up for insufficient property coverage, should that scenario exist.
Sarasohn & Company –
Public Insurance Adjusters since 1924
Do you have a residential or commercial property in Florida, Georgia, Texas, North Carolina or South Carolina? The public adjusters at Sarasohn & Company are experts at maximizing your insurance claim recovery. We don’t get paid unless you do!
Most states license all insurance adjusters, whether they work for an insurance company or for the public. Adjusters working for the insurance companies are obligated to treat all claimants fairly and impartially. However, they are paid by the insurance companies for their efforts. The state recognizes that you, the policyholder, are entitled to equal representation and you may retain the services of an expert adjuster to assist in the claim process. Sarasohn & Company can assist in preparing your claim, guiding you through the claim process and helping to achieve the most favorable settlement. In addition to numerous state licenses, Stephen Sarasohn has held the nationally recognized designation of Senior Professional Public Adjuster since 1988.
Stephen Sarasohn SPPA stephensarasohn@gmail.com Public Adjusters since 1924 www.sarasohn.net 561-368-5000 office 561-866-3589 cell
Comments: Comments Off on Florida’s brewing condo crisis as property values drop in once-coveted retirement haven
A slow-motion crisis is unfolding in Florida’s condo market, threatening to upend the state’s image as a haven for retirees and reasonably priced beach living.
Owners of the state’s older condos are bracing for steep special assessments, while racing to sell their homes and receiving only tepid buyer response.
Amid a property market that’s still vibrant for nearly every other segment, Florida’s aging condominiums are losing value. And nearly 1,400 buildings are now blacklisted from receiving mortgage financing, making those apartments an even-tougher sell.
Thousands of Florida condo units face special repair assessments which are making them difficult to sell — and causing them to lose value quickly. oldmn – stock.adobe.com
At the heart of this turmoil is a basic reality: Florida’s aging condo buildings desperately need repairs, and state officials are forcing them to assess (and pay for) those long-overdue upgrades.
Under a law enacted after the tragic 2021 collapse of Champlain Towers South in Surfside, which saw 98 people lose their lives, condo boards may no longer defer major structural improvements to another day — or decade. The “Building Safety Act” required every condo tower in Florida aged 30 years or older to complete a structural integrity study by the end of 2024, to get a full grasp of what problems need fixing.
This year, the tab for those repairs comes due. Condo boards must now set aside funds to fix the issues found in those studies — from concrete restoration to balcony overhauls. And the assessments on individual condo owners are looking both pricey and unsettling.
“You’re going to see a massive reduction in the value of these buildings based on these giant special assessments and the work that has to be done,” said Orest Tomaselli, CEO of Strategic Inspections, which advises condo boards nationally on how to shore up their reserves.
In Florida buildings he’s worked with, Tomaselli has seen special assessments as low as $250 per month, to a property that levied $2,500 per month, per unit owner, for a three-year stretch.
The assessments result from inspection and repair mandates stemming from the 2021 Surfside building collapse that killed 98 people. AP
“There are real people in these units that may be displaced,” Tomaselli said of the assessments, “that may lose their nest egg and may lose tremendous amounts of value in their units.”
”At Aventura’s Mediterranean Village, a waterfront condo complex with a marina out front, unit owners were hit with six-figure special assessments last year, some as high as $400,000, according to published reports.
At Miami’s Cricket Club, a 50-year-old waterfront tower burdened with $134,000 special assessments per condo, 23 of the building’s 217 condos are currently for sale, according to brokerage Compass. In a Miami market where the median condo price was $445,000 in the fourth quarter of last year, condos at the Cricket Club are seeking buyers with prices as low as $220,000 for a 1,950-square-foot two-bedroom on the 19th floor. (The owner initially sought $330,000).
The Summit Towers in Hollywood, FL is facing a $56 million assessment. Google Maps
Meanwhile, at Summit Towers in Hollywood, a building-wide special assessment of $56 million led to the ousting of four board members in a January election, in favor of new members who promised “a more moderate approach” to building up reserves, said Amy Greenberg, a broker and resident of the building with several listings there.
“A lot of people moved here to be able to retire and live their life here, and they’re on fixed incomes,” said Kathleen DiBona, a 50-year resident of Hollywood who serves as president of the Hollywood Beach Civic Association. “They’re having a difficult time being able to manage all that’s coming and hitting them.”Many owners whom DiBona knows in Hollywood, a city dotted with older towers, are seeking to off-load units with little success. Others, she said, have dropped insurance coverage for their condos so they can manage to pay their special assessments.
Failure to pay these assessments will impact more than just the individual owners who can’t afford them. If 15% of unit owners in a building default, the entire property could become ineligible for mortgage financing, according to Tomaselli of Strategic Inspections.
“What happens if nobody can get a loan to buy a unit in your building?” says Joseph Hernandez, a Miami-based partner in the real estate group of law firm Bilzin Sumberg. “It essentially makes the units in your building unsaleable and it makes the value of those units go down.
“We may see a lot of condo projects go into distress.”
Some could already be getting close. In February, Fannie Mae, the national mortgage finance agency, updated its running list of “unavailable” US condo buildings, meaning they are no longer eligible for mortgage financing. Of the 4,885 buildings currently on the list, 29% are located in Florida, the highest share of any state. The top reason: “critical repairs or deferred maintenance,” according to a person familiar with the roster.
One newly flagged example is 4000 Island Blvd., a 32-story condominium in Aventura’s exclusive Williams Island, which was built in 1985 and added to Fannie Mae’s no-lending list in January. At least 24 unit owners are trying to sell, according to Compass. Barry Sytner, the condo board’s president, called the building’s inclusion on Fannie Mae’s list “incorrect,” noting that the property just secured a bank loan commitment to cover expenses tied to its 40-year inspection.
There are roughly 1.1 million condo units in Florida that are 30 years old or more, and subject to the new law, according to the Florida Policy Project. Of those, 58% are concentrated along the Southwest and Southeast coastal counties, in places like Tampa, Clearwater and the greater Miami metro area, including Fort Lauderdale and Palm Beach County.
Around two dozen condos are up for sale in this Aventura, FL condo building, according to reports. miamiresidence.com
That means the law’s reach extends to more than half of all condo owners in Florida’s famed retirement enclaves. According to brokerage ISG World, apartments that are over 30 years old accounted for 86% of all Southeast Florida condo listings in the fourth quarter of 2024 — a total of 17,198 properties for sale across Miami-Dade, Broward and Palm Beach counties.
Yet even as thousands of newcomers flock to the region, these abundant and discounted units are languishing on the market, weighed down by the threat of special assessments and uncertainty over looming repair costs.
“The fear of the unknown is scaring the hell out of potential buyers,” said Craig Studnicky, ISG’s chief executive officer.
“Remember that show, ‘Let’s Make a Deal?’ ” Studnicky said. “They may get a special assessment and it could be quite modest, which means you just made one hell of a deal. But what if you’re wrong, and the special assessment is gargantuan? Not only is the special assessment big, but the scope of construction is big, and you’re going to be living in a construction site for the next two years.”
The full extent of special assessments is still an open question for many Florida properties. While the state deadline for condos to submit their structural integrity studies was on Dec. 31, only 39% of buildings in Southeast Florida have done so, according to the Miami Association of Realtors.
Some of that’s because engineers were simply not available, amid a statewide rush to get these studies completed. Others could be gambling that enforcement won’t be robust or swift, said Peter Zalewski, a Miami-based broker, analyst and condo investment consultant.
“You’re going to see a massive reduction in the value of these buildings based on these giant special assessments and the work that has to be done,” said Orest Tomaselli, CEO of Strategic Inspections.
“You have buildings that are shopping for studies, because maybe they’re coming in too high, and maybe they can find someone who can lowball it,” Zalewski said.
“People are figuring out what to do,” Zalewski added. “They think there will be a silver bullet, some kind of cure in the upcoming Florida legislative session” amid outcry from condo owners
The state legislature, which convenes its 2025 session March 4, has no plans to bail out condos or offer reprieve from the deadlines to fund repairs, Florida legislative leaders said at a condo conference last month held by Miami Realtors, according to Homes.com.
“A lot of people moved here to be able to retire and live their life here, and they’re on fixed incomes,” said Kathleen DiBona. Courtesy of Kathleen DiBona
Lawmakers, however, might consider financing solutions to help condos cover the cost of structural studies and maintenance, including allowing reserve funds they set aside to be invested.
Despite some maintenance challenges, Florida’s older condos still reflect the only affordable opportunity at homeownership for those who can’t swing the price tags of Miami’s new crop of ultra-luxury developments, says Scott Diffenderfer, a Miami-Beach-based broker for Compass who specializes in sales of older units.
He says he’s pretty upfront with potential buyers these days about the scope and costs of repair that some of his listings will undergo.
Brokers view the new regulations and mandatory repairs as a necessary correction to Florida’s once-lax condo standards, Diffenderfer explained.
Previously, buyers had little insight into a building’s true condition — much like purchasing a used car without a Carfax report.
Now, with stricter enforcement requiring proper reserves and full disclosure of maintenance history, brokers say the condo market could become more transparent and ultimately unlock greater value for owners.
“For probably 75% of the buildings in South Florida, when the dust settles, people are going to say, ‘You know what? That was painful. But look at these buildings!’ ” Studnicky said. “They’re in great shape.”
Comments: Comments Off on Florida Building Inspections By: Structural Engineering and Building Consulting firm – Joe DiPompeo, PE
Florida Building Inspections
Structural Engineering and Building Consulting firm
By: Joe DiPompeo, PE
Building inspections are a critical component of property management in the state of Florida. They help to ensure that buildings are maintained in good condition and meet building codes, which is essential for protecting both tenants and property owners.
First and foremost, building inspections are necessary to ensure that buildings are compliant with certain codes and regulations. In Florida, building codes are set by the Florida Building Code (FBC), which establishes standards for the construction, maintenance, and repair of buildings in the state. These codes cover everything from electrical and plumbing systems to fire safety and structural integrity. While most codes are applicable to the construction of the building, Florida has significant codes and requirements throughout the life of the building, such as structural and electrical recertification inspections. Failure to comply with these codes can result in fines, legal action, and even the closure of the building.
By conducting regular inspections, property managers can identify any issues that may be in violation of these codes and requirements and take corrective action before they become serious problems. For example, an inspector may find deteriorating structural concrete or issues with the electrical wiring. These issues can be addressed before they put the safety of tenants and the property at risk or become a larger, more expensive problem to fix.
In some places, such as Florida, there are mandatory ordinances which enforce regular building inspections. These inspections should be conducted by a certified Professional Engineer and then file a report with the local building department or and/or state. If these requirements are not met, the property owner or manager will receive a fine.
Furthermore, building inspections can also help property managers identify maintenance needs. Over time, buildings can experience wear and tear, and components can break down. By conducting regular inspections, property managers can identify these issues and take corrective action before they become more serious and costly to repair. This can help to extend the lifespan of the building and save money in the long run.
Moreover, building inspections are essential for protecting property values. Properties that are well-maintained and free of hazards are more attractive to tenants and can command higher rents and sale prices. Regular inspections can help to identify issues that may be causing damage to the building, such as water leaks or structural issues. By addressing these issues early, property managers can prevent further damage and ensure that the building maintains its value.
Finally, building inspections can also provide peace of mind for property owners and tenants alike. By knowing that the building is being regularly inspected and maintained, owners can be confident that their investment is being protected. Tenants, on the other hand, can feel reassured that they are living in a safe and well-maintained environment.
In conclusion, building inspections are a crucial part of property management in Florida. They help to ensure compliance with building codes and regulations, identify potential hazards, identify maintenance needs, protect property values, and provide peace of mind for owners and tenants. By conducting regular inspections, property managers can prevent serious problems from occurring and ensure that their buildings are safe and well-maintained and compliant with state and local requirements.
Structural Workshop
Structural Engineering and Building Consulting firm
What happens if condos dont get the florida inspection?
If a condo in Florida does not undergo the required inspection, the condo association could face significant consequences including: difficulty obtaining insurance renewals, increased insurance premiums, potential legal action from owners, inability to sell units easily due to disclosure requirements, and may be forced to levy special assessments on owners to cover necessary repairs identified in the inspection if they are not completed, potentially leading to financial strain for residents; ultimately, if structural issues are severe, the building could be deemed unsafe for occupancy by local authorities.
Key points about Florida condo inspections:
New legislation:
Florida enacted strict laws requiring regular structural inspections for condos, particularly older buildings, following the tragic Champlain Towers collapse in Surfside.
Consequences of non-compliance:
Condo associations that fail to get inspections done could face penalties, including difficulty securing insurance, higher insurance costs, and potential legal action from unit owners.
Disclosure requirements:
Inspection reports must be disclosed to potential buyers, making it difficult to sell units if the building has not been inspected and repairs are needed.
Reserve funds:
Inspections are often tied to the need to build up sufficient reserve funds to cover necessary repairs identified in the inspection
Update Jan, 13, 25
What is the new law for condo inspection in Florida?
Under the laws, all buildings occupied before 1992 must complete a milestone inspection by Dec.31, 2024. This is an examination of the building’s structural integrity by an architect or engineer. The requirement also applies to buildings at least 25 years old that are within 3 miles of the coast
In Florida, if your condo association fails to get a required “milestone inspection” done by the deadline, they could face legal consequences, including potential fines and penalties, as the law mandates these inspections for structural integrity, particularly for buildings reaching 30 years old and every 10 years thereafter; however, if you are actively trying to schedule the inspection and encounter delays due to factors like a backlog of engineers, you might be able to demonstrate “good faith effort” to avoid severe repercussions.
Key points about Florida condo inspections and missed deadlines:
Milestone Inspection Requirement:
Florida law requires most condominium buildings to undergo a comprehensive “milestone inspection” once they reach 30 years old and then every 10 years after that.
Potential Consequences:
If the inspection is not completed on time, the condo association could face penalties or legal action from the state or unit owners.
“Good Faith Effort” Defense:
If the association can demonstrate they were actively trying to schedule the inspection and encountered unavoidable delays (like a shortage of qualified engineers), they might be able to avoid severe penalties.
What to do if you miss the deadline:
Contact the condo association:Immediately reach out to the association board to understand the situation and discuss next steps.
Review the inspection requirements:Ensure the association is aware of the specific deadlines and necessary steps for the milestone inspection.
SB 4-D increases the safety of Florida’s condominiums by requiring inspections for all condominiums and cooperative buildings that are three stories or higher. SB 4-D requires the following for condominiums and cooperatives:
Condominiums and cooperatives must conduct a Structural Integrity Reserve Study (SIRS) for buildings that are three stories or higher to ensure that necessary funding is available for any future structural repairs that may be needed. This study must be completed at least every 10 years after the condominium’s creation, regardless of the condominium’s age.
Structural milestone inspections are required for condominium and cooperative buildings of a certain age, depending on their distance from the coastline.
To increase transparency and accountability, all structural inspection reports and reserve studies are required to be part of the condominium association’s’ official record and must be provided to potential purchasers of a condo unit.Consult legal advice:If there are concerns about potential legal issues, consider seeking advice from a legal professional specializing in Florida condominium law.
What is Senate Bill 4-D? -Some background:
SB 4-D increases the safety of Florida’s condominiums by requiring inspections for all condominiums and cooperative buildings that are three stories or higher. SB 4-D requires the following for condominiums and cooperatives:
Condominiums and cooperatives must conduct a Structural Integrity Reserve Study (SIRS) for buildings that are three stories or higher to ensure that necessary funding is available for any future structural repairs that may be needed. This study must be completed at least every 10 years after the condominium’s creation, regardless of the condominium’s age.
Structural milestone inspections are required for condominium and cooperative buildings of a certain age, depending on their distance from the coastline.
To increase transparency and accountability, all structural inspection reports and reserve studies are required to be part of the condominium association’s’ official record and must be provided to potential purchasers of a condo unit.
What is Senate Bill 154?
SB 154 revised the requirement for condominiums to collect reserves and allows a majority of voting residents to elect not to provide reserves or to provide less reserves than required. However, this legislation prohibits waiving or reducing reserve funding for repairs and maintenance of structural components identified in the SIRS.
Additionally, SB 154 refined the requirements of the SIRS to provide clarification on the items required in a SIRS and expanded who can perform a SIRS.
SB 154 allowed a specific type of condominium (multi-condominium with 25 condominiums or more) to provide no reserves or less reserves than required if an alternative funding method was approved by the Division of Condominiums, Timeshares, and Mobile Homes. The Division received funding to contract with a third-party to review alternative funding methods submitted to the Division for review and approval.
What is House Bill 1021?
HB 1021 increases transparency and accountability through changes to meeting requirements, voting, education for condominium directors, recordkeeping and reporting, and support from the Florida Department of Business and Professional Regulation (DBPR). Additionally, HB 1021 introduced criminal penalties for board members who act in bad faith, increased DBPR’s ability to address resident complaints through investigations, and established a criminal referral process to streamline accountability for individuals that have engaged in criminal activity.
What types of buildings or structures are excluded from the Structural Integrity Reserve study (SIRS) requirements?
The SIRS requirements do not apply to buildings less than three stories in height; single-family, two-family, or three family dwellings with three or fewer habitable stories above ground; any portion or component of a building that has not been submitted to the condominium form of ownership; or any portion or component of a building that is maintained by a party other than the association.
Who is required to do a Structural Integrity Reserve study (SIRS)?
A residential condominium association must complete a SIRS for every building in the condominium that is three stories or higher, as determined by the Florida Building Code.
When is the Structural Integrity Reserve study (SIRS) due, and how often does my association need to complete a SIRS?
Unit owner-controlled associations existing on or before July 1, 2022, must have a SIRS completed by December 31, 2024. A residential condominium must have a SIRS completed at least every 10 years after the condominium’s creation.
The deadline to complete a SIRS is December 31, 2024. When does my association have to start reserving for a SIRS?
If your budget is adopted on or before December 31, 2024, you may vote to waive or provide less than the required SIRS reserves with a majority vote of the total voting interest of the association. You will need to begin funding your SIRS reserves in accordance with the reserve study January 1, 2026.
If your budget is adopted on or after January 1, 2025, you may not waive your SIRS reserves and need to begin funding your SIRS reserves in accordance with the reserve study.
When does my association have to report to the SIRS?
Within 45 days after receiving the SIRS, the association must provide the division with a statement indicating the study was completed and provided to the unit owners.
Can a milestone inspection or inspection for a similar local requirement, such as a re-certification inspection, substitute a SIRS visual inspection?
An association that is required to complete a MI in accordance with section 553.899, Florida Statutes, on or before December 31, 2026, may complete the SIRS simultaneously with the milestone inspection (MI). However, in no event may the SIRS be completed after December 31, 2026.
If the MI required by section 553.899, Florida Statutes, or an inspection completed for a similar local requirement, was performed within the past 5 years and meets the SIRS requirements, such inspection may be used in place of the visual inspection portion of the SIRS.
What is the difference between a milestone inspection and a SIRS?
A milestone inspection is a structural inspection of the building, including the load-bearing elements.
A SIRS is based off a visual inspection of the items required in s. 718.112(2)(g), F.S. and is a budget planning tool that identifies components of a condominium that are the responsibility of the association to maintain and replace and includes a plan to fund future maintenance and repairs.
Comments: Comments Off on free Educational Breakfast event in Broward. One Elective CE for CAMs & great info for Board Members. The 4 R’s: Repair, Restoration, Recovery and Re-roof
Join the Firm’s networking group’s free Educational Breakfast event in Broward.
One Elective CE for CAMs & great info for Board Members.
The 4 R’s: Repair, Restoration, Recovery and Re-roof
Recently we reported to you that a panel of the U.S. Court of Appeals for the Fifth Circuit vacated (reversed) the Texas District Court’s previously enacted injunction that had the effect of making the Corporate Transparency Act’s registration requirements applicable once again.
Guess What? On December 30th, 2024 the U.S. Court of Appeals for the Fifth Circuit again reinstated the nationwide injunction. FinCen’s website provides that, “in light of a recent federal court order, reporting companies [which includes Florida’s condominium, homeowners’, and cooperative associations] are not currently required to file beneficial ownership information with FinCEN and are not subject to liability if they fail to do so while the order remains in force. However, reporting companies may continue to voluntarily submit beneficial ownership information reports.
The FinCen website provides a procedural history that further explains the current situation as follows:
On Tuesday, December 3, 2024, in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al., No. 4:24-cv-00478 (E.D. Tex.), the U.S. District Court for the Eastern District of Texas, Sherman Division, issued an order granting a nationwide preliminary injunction. The Department of Justice, on behalf of the Department of the Treasury (Treasury), filed a Notice of Appeal on December 5, 2024 and separately sought of stay of the injunction pending that appeal.
On December 23, 2024, a panel of the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction entered in Texas Top Cop Shop, Inc., pending the outcome of Treasury’s ongoing appeal of the district court’s order. Treasury immediately issued an alert notifying the public of this ruling and recognizing that reporting companies may have needed additional time to comply with beneficial ownership reporting requirements, Treasury extended reporting deadlines. However, on December 26, 2024, a different panel of the U.S. Court of Appeals for the Fifth Circuit issued an order vacating the Court’s December 23, 2024 order granting a stay of the preliminary injunction. On December 31, 2024, the Department of Justice, on behalf of Treasury, sought a stay of the injunction pending the ongoing appeal from the Supreme Court of the United States.
In the meantime, as of December 26, 2024, the injunction issued by the District Court in Texas Top Cop Shop, Inc. is once again in effect. FinCEN is complying with—and will continue to comply with—the District Court’s order for as long as it remains in effect. As a result, reporting companies are not currently required to file beneficial ownership information with FinCEN. Reporting companies may continue to voluntarily submit beneficial ownership information reports.
As new information is obtained we will share it with you, our readers. For those who are interested, our prior Association RoundUp articles regarding the Corporate Transparency Act debacle follow below.
THE CORPORATE TRANSPARENCY ACT STRIKES BACK
In the never ending saga regarding the applicability of the Corporate Transparency Act, there is yet another twist in that the judge in the Texas litigation, which we wrote about to you on December 14 and who issued the nationwide injunction, reversed course on December 23, when he lifted the court’s previously enacted injunction making the Corporate Transparency Act’s registration requirements applicable once again. However, FinCen, in light of the short notice, has extended the deadline in which to register to January 13, 2025 absent other deadline extensions.
As reported in our prior article, a recent update from the United States Department of Treasury, Financial Crimes Enforcement Network (FinCen) provides an extension of time to comply with the requirements of the Corporate Transparency Act for the initial reporting deadlines, but there are strict requirements regarding the applicability of the extension as discussed below.
FinCen, on October 29, 2024, extended the initial reporting deadlines to June 30, 2025, for associations in counties affected by Hurricane Milton where:
(1) Federal Emergency Management Agency (FEMA) assistance is available for individual or public assistance; and
(2)IRS tax filing deadlines have been extended.
Associations in the following counties appear to be subject to the extension:
Alachua, Baker, Bradford, Brevard, Broward, Charlotte, Citrus, Clay, Collier, Columbia, DeSoto, Dixie, Duval, Flagler, Gilchrist, Glades, Hamilton, Hardee, Hendry, Hernando, Highlands, Hillsborough, Indian River, Lafayette, Lake, Lee, Levy, Madison, Manatee, Marion, Martin, Miami-Dade, Monroe, Nassau, Okeechobee, Orange, Osceola, Palm Beach, Pasco, Pinellas, Polk, Putman, Sarasota, Seminole, St. Johns, St. Lucie, Sumter, Suwannee, Taylor, Union, and Volusia.
Of course, to be absolutely certain, please check with your association’s attorney.
_________________________________________
The December 23, 2024 email communication received from the Financial Crimes Enforcement Network as reported on above follows:
Updates to Beneficial Ownership Information Reporting Deadlines – Beneficial Ownership Information Reporting Requirements Now in Effect, with Deadline Extensions
In light of a December 23, 2024, federal Court of Appeals decision, reporting companies, except as indicated below, are once again required to file beneficial ownership information with FinCEN. However, because the Department of the Treasury recognizes that reporting companies may need additional time to comply given the period when the preliminary injunction had been in effect, we have extended the reporting deadline as follows:
Reporting companies that were created or registered prior to January 1, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN. (These companies would otherwise have been required to report by January 1, 2025)
Reporting companies created or registered in the United States on or after September 4, 2024 that had a filing deadline between December 3, 2024 and December 23, 2024 have until January 13, 2025 to file their initial beneficial ownership information reports with FinCEN.
Reporting companies created or registered in the United States on or after December 3, 2024 and on or before December 23, 2024 have an additional 21 days from their original filing deadline to file their initial beneficial ownership information reports with FinCEN.
Reporting companies that qualify for disaster relief may have extended deadlines that fall beyond January 13, 2025. These companies should abide by whichever deadline falls later.
Reporting companies that are created or registered in the United States on or after January 1, 2025 have 30 days to file their initial beneficial ownership information reports with FinCEN after receiving actual or public notice that their creation or registration is effective.
As indicated in the alert titled “Notice Regarding National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)”, Plaintiffs in National Small Business United v. Yellen, No. 5:22-cv-01448 (N.D. Ala.)—namely, Isaac Winkles, reporting companies for which Isaac Winkles is the beneficial owner or applicant, the National Small Business Association, and members of the National Small Business Association (as of March 1, 2024)—are not currently required to report their beneficial ownership information to FinCEN at this time.
On Tuesday, December 3, 2024, in the case of Texas Top Cop Shop, Inc., et al. v. Garland, et al., No. 4:24-cv-00478 (E.D. Tex.), the U.S. District Court for the Eastern District of Texas, Sherman Division, issued an order granting a nationwide preliminary injunction. On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay of the district court’s preliminary injunction enjoining the Corporate Transparency Act (CTA) entered in the case of Texas Top Cop Shop, Inc. v. Garland, pending the outcome of the Department of the Treasury’s ongoing appeal of the district court’s order. Texas Top Cop Shop is only one of several cases that have challenged the CTA pending before courts around the country. Several district courts have denied requests to enjoin the CTA, ruling in favor of the Department of the Treasury. The government continues to believe—consistent with the conclusions of the U.S. District Courts for the Eastern District of Virginia and the District of Oregon—that the CTA is constitutional. For that reason, the Department of Justice, on behalf of the Department of the Treasury, filed a Notice of Appeal on December 5, 2024 and separately sought of stay of the injunction pending that appeal with the district court and the U.S. Court of Appeals for the Fifth Circuit.
The Kaye Bender Rembaum Team Remains Available To You and Your Community Association
Comments: Comments Off on Event: January 23rd from 2-4pm, get updated on ‘2025 Legal Update’ byKBR Legal’s – Lisa Magill, Esq. BCS
On January 23rd from 2-4pm Est (via Zoom), get updated on the most recent legislative changes and discuss the statutory changes made by the Florida Legislature and how they directly affect managers, board members, and their communities.
Lisa Magill, Esq. BCS will lead the ‘2025 Legal Update’. Complimentary for all; just click below to enroll.
Date & Time
Jan 23, 2025 02:00 PM
Course 9633017 | Provider 0005092 | 2 CE in Legal for CAMS Instructor: Lisa A. Magill, Esq. BCS | Kaye Bender Rembaum, P.L. Get updated on the most recent legislative changes and discuss the statutory changes made by the Florida Legislature and how they directly affect managers, board members, and their communities.
Comments: Comments Off on Out With the Old, In With the New by Published by Eric Glazer, Esq.
The Presidential Inauguration is a reminder of how smoothly leadership transitions can happen at the national level. But in our community associations, things aren’t always so predictable. Discover insights into the often chaotic turnover of power in Florida condos and HOAs—and what it means for your community.
Whether you’re happy about today’s Presidential Inauguration or not, one thing is for sure and for certain; it’s going to happen. Since 1937, it has taken place at noon on January 20, the first day of the new term, except in 1957, 1985, and 2013, when January 20 fell on a Sunday. In those years, the presidential oath of office was administered on that day privately and then again in a public ceremony the next day, on Monday, January 21.
That consistency is a lot more than we can say for our community associations. How many of you have complained that our associations have not held an annual meeting or an election in forever, or at least not in the last year? What about complaints that the Board of Directors has simply changed the dates of our annual meeting on more than one occasion and extended their term in office?
The terms of Board members expire at the annual meeting. So when are you supposed to have an annual meeting and election? The date of your annual meeting is contained within your bylaws. But suppose the Board wants to have the annual meeting on another date for any variety of reasons? Can they do so? Not according to one court which held that the annual meeting must be held on the date contained in the association’s bylaws. Not to do so would be as if an amendment was made to those bylaws without the proper vote of the unit owners.
And despite this ruling, dozens, if not hundreds or maybe even thousands of condominium and HOAs won’t hold their annual meeting and election this year on the date mandated by their own documents.
The last few years has also brought drama to the country regarding the requirements of outgoing administrations to turn over official records. Trump got charged with a crime and Biden was found to have wrongfully retained official records but wasn’t charged with a crime.
When it comes to condominiums, “An outgoing board or committee member must relinquish all official records and property of the association in his or her possession or under his or her control to the incoming board within 5 days after the election. The division shall impose a civil penalty as set forth in s. 718.501(1)(d)6. against an outgoing board or committee member who willfully and knowingly fails to relinquish such records and property.” Surprisingly, there is no equivalent statute for HOAs, except if that director was removed by way of recall.
So today, pomp and circumstance and tradition will rule the day and like clockwork, one administration will hand off to the incoming administration. And in our community associations, no doubt tradition is likely to continue as well. Perhaps that’s a rare example of where the government works better than we think.
Eric is Board Certified by The Florida Bar in Condominium and Planned Development Law.
Since 2009, Eric has been the host of Condo Craze and HOAs, a weekly one-hour show airing at 7 p.m. each Thursday on YouTube. This show allows viewers to engage in live chats with Eric and other participants but also enables a broader audience to access free advice, making valuable insights more widely available.
Eric is the first attorney in the State of Florida that designed a course that certifies condominium and HOA residents as eligible to serve on a Board of Directors and has now certified more than 20,000 Floridians all across the state. He is certified as a Circuit Court Mediator by The Florida Supreme Court and has mediated dozens of disputes between associations and unit owners. Eric also devotes significant time to advancing legislation in the best interest of Florida community association members.
Comments: Comments Off on ASSOCIATION BUDGETING FOR DUMMIES
ASSOCIATION BUDGETING FOR DUMMIES
by Steven J. Weil, PhD, EA, LCAM, Royale Management Services, Inc.
A “dummie,” in this case, is a first-time association member and/or someone with little or no association budgeting experience who wants to know more about how and why the budget is created before they vote on it.
Is it really necessary to go through all that work year after year?
The first answer is, yes, because it’s the law. Florida law (718.112 (2) (f) 2) requires that annual budgets be prepared and, further, that reserve calculations be made by using a formula that estimates useful life and replacement cost.
The real answer is that the budget is a tool used by the association’s board to determine how much owners will be required to pay in maintenance costs for the coming year in order to keep the association financially stable.
The budget is a financial plan, a guide; but the process is an art, not a science. That’s why it’s important to leave room for unplanned expenses. A shortfall may result in an assessment, which will not make anyone happy. The only thing owners hate more than a maintenance fee increase is a special assessment that is necessary because the budget does not adequately cover the ongoing operating and maintenance costs. The tricky part of the process is to balance what is required with the often competing interests of those who want the lowest possible increase with those who are willing to pay more for better services, better amenities or other improvements.
There are two parts to every budget: the operating budget and the reserve budget.
• The operating budget should include all the necessary regular and recurring expenses that are expected in the coming year, no matter how small, such as repairs, maintenance, payroll, utilities, supplies, insurance and administrative costs.
• The reserves are designed to accumulate funds for major ongoing repair and replacement.
Statutes make it mandatory that reserve budgets first include estimated expenditures for roof replacement, building painting and pavement resurfacing at a minimum.
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, et al.
Projected estimates 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.
Reserve funds cannot be used for purposes other than those intended without a majority owner’s vote of approval in advance.
How do you build a budget that works? The big secret is to start months before your current budget year ends!
Step one is the information-gathering process, including a review of long-term contracts, upcoming expected maintenance and repairs, details of possible fee increases and a “wish list.” This time-consuming step includes getting quotes from vendors, examining recurring contracts for things like insurance policies, lawn and landscaping, trash removal, etc. Sometimes closely-scrutinized contracts can be renegotiated to save money. It’s also important to use caution when reducing maintenance and repairs numbers to delay an expense outlay. That could result in increased costs in the long run.
Step two is to compare and, using a spreadsheet or special budget software, enter into the appropriate columns the year-to-date income and expenses — projected through year end — with the budget for the current year, to review for increases, and show the percent of difference.
Step three: compare projected expenses for the coming year with “other” income (non-assessed) — such as laundry income, application fees, clubhouse rental, dock rental and any other items for which the Association collects fees other than maintenance fees.
Using those figures, it is then possible to calculate the maintenance fees needed to fund the budget for the coming year. These required maintenance fees are calculated by subtracting the total projected “other” (non-assessed) income from the total projected expenses. This number is then allocated by the formula shown in the association documents. (The number is often based on the number of units or on square footage.)
According to the Statutes, owners may petition the Board if it adopts a budget where assessments rise more than 15% over those for the prior year. The budget must be in keeping not only with the State Statutes but also with the association’s documents, which may be more stringent.
Final approval by the board where the proposed budget is adopted must be done at a properly noticed budget meeting. A notice of this meeting, along with a copy of the proposed budget, must be sent to all owners at least 14 days prior to the meeting. Only association members may vote to waive or reduce the budgeted reserves through full or partial funding.
Failing to fund reserves at all puts everyone’s future at risk. If owners can’t afford the monthly cost how are they going to come up with the money when the roof, elevator or other capital component needs replacing? Often this is done by borrowing, making monthly maintenance payments higher because of what is required to pay back a loan, creating a double whammy of current debt repayment for past depreciation and creating an excuse not to meet current obligations. In some buildings this can create a death spiral.
SFPMA works throughout the State of Florida, we are a multi-member organization for the Condo, HOA and Property Management industry. Through knowledge based Articles, Events and our Members Directory, Clients find the right information to make an informed decisions for their Florida properties.
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Eric Glazer graduated from the University of Miami School of Law in 1992 after receiving a B.A. from NYU. He has practiced community association law for more than 2 decades and is the owner of Glazer and Sachs, P.A. a five attorney law firm with offices in Fort Lauderdale and Orlando.
Is it really necessary to go through all that work year after year?