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In a rare and stunning reversal, the State of Florida Divisions of Condominiums announced “penalty guidelines” for many matters, beginning with a minimum penalty of $1,000.00. Certain “minor violations” repeated after a “notice of non-compliance” result in a minimum penalty of $500.00, but up to $2,500.00!
How can you find out about it? Unfortunately, you cannot find the proposed rule on the Division’s internet Home page, nor pages for Statutes and Rules, Education, FAQ’s or Forms and Publications. One must leave and visit the Florida Department of State’s webpage, access the Florida Administrative Code & Florida Administrative Register, and then search for the rules being changed. The Notice of Proposed Rule can be found at: https://www.flrules.org/Gateway/View_notice.asp?id=20627067.
The State’s proposal drastically shifts the Division’s focus from that of the last two Governors, Bush and Crist. Those Governors recognized that the Division should concentrate on the education of associations, and their directors and owners. There was a general recognition that citizen expectations for enforcement, including penalties, could not be satiated, even after pumping millions more dollars into enforcement. Further, focusing on enforcement would discourage competent persons from volunteering to serve as directors.
The administration’s basis for proposing rule changes is “to address amendments made to Chapter 718, F.S.” in 2017. It is noted that the amendments to the Condominium Act last year did not mandate a shift from education to fining.
You may ask what constitutes a minor violation for which a repeated incident results in a minimum $500.00 fine. This includes not disclosing the beginning and ending dates of a proposed budget period. This means if the date at the top of the proposed budget is not present, a seemingly frequent oversight, an association will find itself in the target of the Division. Penalties beginning at $1,000.00 and more include failing to charge interest on past due assessments, allowing an ineligible person to run for director, co-mingling association funds with non-association funds, counting improperly cast ballots, and failing to include required documents on the association’s website, among a listing that extends over seven pages long.
Obviously, condominium associations will want to ensure that inadvertent oversight does not become the basis for a fine. Seemingly minor issues now can become very expensive even if there is no harm to any unit owner. Proverbial “dotting the i’s and crossing the t’s” becomes more important. Directors and officers will want to be more careful because owners may blame them for the imposition of fines.
Though the official public comment period has passed, Gelfand & Arpe has requested that the public be allowed a further opportunity to comment. In response, a tentative hearing date is Monday, August 13, 2018 at 9:00 a.m., in the Division’s Tallahassee office. In the interim, condominium association officers and directors are urged to review the potential violation areas as well their general operations to help ensure that their operations are in compliance.