As we have written about a million times, each condominium unit pays $4.00 per year to the Department of Business and Professional Regulation, Division of Condominiums, Timeshares and Mobile Homes. That $4.00 is supposed to be spent on the people who are paying it. The law states that:
All fees shall be deposited in the Division of Florida Condominiums, Timeshares, and Mobile Homes Trust Fund as provided by law.
I don’t remember the exact figures, but roughly the Division collects $12,000,000.00 and only spends $6,000,000.00 of it. The unspent $6,000,000.00 gets swept into the general revenue fund to be used by Florida’s legislators for anything they want to use it for. Now all I know is that if I took money from my “trust” account and did not give it to the client, I lose my license and get arrested. Apparently, it’s OK however if The Florida Legislature does it to all of you.
Florida just passed the most sweeping changes to condominium law ever. It made full funding of reserves a must, meaning it can no longer be waived. Here’s the problem………how is that going to be enforced? Suppose the Board says “to hell with this new crazy law, I’m just not doing it, I’m not collecting reserves and I don’t care what anybody says.”
Remember, the purpose of this new law was to ensure another Champlain Towers does not occur again. This law was a life saving statute. But it’s a statute that nobody is watching. The statute relies on condominiums policing themselves.
I have a better idea…….Let’s hire a bunch of new people at the DBPR whose sole job it would be to ensure that every condominium that is 3 stories or higher is passing a budget that complies with the new law and contains fully funded reserves. Each condominium association would be required to file their budget annually with the DBPR and proof that the reserves are actually being funded. If the budget is correct, and the reserves are being funded, the association would get a letter saying so. If the budget was incorrect, the reserves were not being funded or the obligation to file the budget was ignored, the DBPR would send out the appropriate warning letters. They would be there to answer questions about this important live saving statute. If all fails, they would be given the power to pursue administrative fines and penalties against the Board members directly inasmuch as the new statute makes it clear that failure to follow these laws are a breach of the director’s fiduciary duties.
AND WE HAVE THE MONEY TO DO THIS RATHER EASILY. ALL WE HAVE TO DO IS ASK THAT THE FLORIDA LEGISLATURE LEAVE THE MONEY FOR THE PEOPLE THAT PAID IT. THAT’S IT.
This would be a very new and important task for the DBPR. So Florida Legislature….next legislative session, give the DBPR some power to enforce the new reserve statute and make sure the Division can take the money to fund this new responsibility out of their own trust account. Lives may depend on it.