I’m not going to tell you that you should have a bunch of new year resolutions that you must follow. We all know how long they last. So, I’ll only suggest one at the end of this article. However, I am going to tell you that if your budget still does not contain reserve funding, your new year is already off to a bad start.
Some of you think that since you are allowed to waive reserves for the years of 2023 and 2024, why not take advantage of it for another two years. In other words, you’re still thinking that it’s a good idea to waive reserves for another 2 years. I’m sorry, that doesn’t make you smart, that makes you an idiot. Did you learn anything from Surfside?
Starting two years from right now, reserves will be mandatory. Why not get a jump on funding them now so that you wind up paying a little less than expected in 2025?
To give an example, if you start reserving for the roof today instead of 2025, you wind up paying less for the roof each month, two years from now.
It is absolutely amazing me that there are still condo associations that are not including reserves in their budget. It also amazes me just how many associations still don’t know about the new laws and how much it’s going to cost them.
I’ll say for sure and for certain that even though the law requires reserve funding in 2025, there will be many associations that still waive the funding of reserves. Their boards and community members have no idea about required fire safety, milestone inspections and mandatory reserves. These associations in effect will be self-policed. It will take a unit owner in that condo to file a complaint with the DBPR. The DBPR will most likely require that association to immediately start funding a reserve account and make up the money that should have been there had the association started on time. It will be expensive to catch up.
Why not start the process now? Why not get every owner used to the concept that their assessments are going up?
There are still people out there who believe this new law isn’t going to happen. They believe that their assessments will remain the same and The Florida Legislature will end up repealing these new laws. I disagree. There wasn’t a single vote in opposition to these new laws in The Florida Legislature. Not one. Every legislator understood the importance of these new laws after The Champlain Towers collapsed in Surfside, killing 98 people as they slept in their beds.
I will tell you that there is one New Year’s resolution all Board members should have: How about adopting a budget that at a minimum funds reserves at 50%? Do it now and the hit in two years won’t be so terrible.