Friday, July 30, 2010

Who do you want serving on your condominium board?

Bring up the topic of who can and should serve on a community’s board of directors and you are probably in for a heated debate. On the one hand, so few people have the time or inclination to volunteer their service these days that the thought is to keep the pool of eligible directors as broad as possible. On the other hand, directors have the ability to profoundly impact the quality of their members’ lives so the best possible candidates must be chosen. Ultimately, it is up to the members to get involved and cast their votes wisely. It is not realistic, however, to expect association members to do their own due diligence on each candidate which is why the Legislature has set some minimum standards for condominium board member eligibility.

The most recent changes to Florida Statutes (effective on July 1, 2010) which affect board member eligibility and candidate certification requirements in condominium associations include items that impact the information provided in and the contents of your Condominium’s Annual Meeting and Election Packages, such as the following:

o The restrictions upon co-owners serving on the board has been relaxed to allow co-owners to serve where such co-owners own more than one (1) unit, or where there are not enough eligible candidates to fill the vacancies on the board.

o The director delinquency restriction has been expanded to include any person delinquent more than ninety (90) days in the payment of ANY monetary obligation to the association, including fines, fees, and regular or special assessments. Such persons are not eligible for board membership.

o The candidate certification requirement prior to the election has been removed and replaced with a certification required from all directors within ninety (90) days after being elected. Each newly elected or appointed director must certify in writing within 90 days after being elected or appointed that he or she has read the association’s governing documents (declaration, bylaws, articles and current rules/policies), and that he or she will work to uphold these documents to the best of his or her ability, and faithfully discharge his or her fiduciary duty to the association and its members.

o In lieu of such written certification, a director may submit a certificate of satisfactory completion of the educational curriculum from a condominium education provider approved by the Division.

o Directors who do not submit proper certification are suspended from board service until they comply with this requirement, and the board may appoint an interim replacement.

o The Association Secretary must maintain each directors’ certifications for five (5) years after their election.

o Directors charged by information or indictment with a felony theft or embezzlement offense involving association funds must be removed from office until the end of the period of the suspension or the end of the director’s term, whichever occurs first.

Please be sure to discuss these changes with your association attorney and manager to ensure that your community’s annual meeting and election package complies with these statutory changes. Of course, the above requirements currently apply only to condominium associations and not to HOA’s or cooperatives. I can’t think of a compelling reason why we should be less concerned about who is serving on HOA and cooperative boards than we are about those serving on condominium boards; can you?

Wednesday, July 28, 2010

Have we become complacent since Wilma?


If you’re like me, you listened to the news reports broadcasting the experts’ predictions for a very active storm season this year back in early June and haven’t thought much about it since. We have had no real storm activity other than Tropical Storm Bonnie which quickly weakened to a depression and then to nothing more than an average Florida rainy afternoon.

Recently, however, I was fortunate enough to attend an event at which Max Mayfield, the well-known meterologist who served as the Director of the National Hurricane Center from 200-2007, spoke. These days, Mr. Mayfield serves as a hurricane specialist for WPLG. Those of us in attendance learned the following tidbits about our not-so- friendly visitors each June-November:

• Peak hurricane season runs from mid-August to mid-October. The fact that we have not seen much activity as of the date of this blog does not mean we are out of the woods. In fact, we aren’t even in the most active part of the hurricane season yet.

• The Atlantic waters are 1 to 1 1/2 degrees warmer than usual this year which is very similar to what occurred during 2004 and 2005 when our State was battered by several named storms.

• The ability to forecast the likelihood of a storm and its eventual path continues to improve but the ability to forecast a storm’s rapid change in intensity remains a challenge.

• The time periods for a Hurricane Watch and a Hurricane Warning have recently been extended to 48 hours and 36 hours respectively.

• Hurricane Wilma which brought such devastation to so many different parts of Florida in October of 2005 was only a Category 2 storm.

• Since Wilma, we are in better shape in terms of grocery stores, gas stations and other critical locations having backup power sources as well as hardening efforts made by FPL to their infrastructure. However, depending on a storm’s strength and the resulting damage it inflicts, structural damage might still render the aforesaid locations incapable of operating even with generators.


If you haven’t seen a board, committee or membership meeting agenda item yet this year in your community discussing hurricane preparedness, you need to find out why that is. Almost 5 years has gone by since we were last tested by a hurricane in our State; many boards have changed hands since that time so it is likely that there are some communities with leadership in place that has no experience whatsoever with storm preparation or cleanup. Boards and managers certainly have more on their preparation checklists beyond putting gas in the car and turning down the refrigerator thermostat. These folks are responsible not only for their personal preparations but for the community-wide preparations as well. For those of you who still might not have a hurricane preparedness plan in place for your community, free copies of CAN’s Hurricane Preparedness Guide for Community Associations are available online at www.canfl.com.

Friday, July 23, 2010

Governor Crist authorizes interim property assessments as a weapon against BP Oil!

On July 21st, Governor Crist issued Executive Order No. 10-169 which is the seventh consecutive order since the Deepwater Horizon explosion on April 21, 2010. Previous orders declared a total of 26 Florida counties as being under a “State of Emergency” as a result of the oil spill.

This latest order authorizes all County Property Appraisers to provide interim assessments of any real property that may have suffered a loss in value as a result of the BP Oil Spill according to the just value of such property.

As you may already be aware, the Property Appraiser’s Office in each of the 67 Florida Counties are required by law to appraise all real property located within their respective county. Each property is to be assessed based upon its respective value as of January 1st of the tax year in question.

The purpose of Governor Crist’s authorization of interim assessments is to document the current year’s property damage claims against British Petroleum (BP). The Governor’s Executive Order encourages Property Appraisers to make these interim assessments available to any affected property owner who can, in turn, use such documentation as a basis for establishing a claim for any sustained loss. Thus, by using an interim assessment as provided by the County Property Appraiser’s Office, many community associations and property owners will be relieved of the burden of having to hire an independent property appraiser for the purpose of establishing a claim against BP.

Of course, the usefulness of the interim assessments will depend greatly upon both the initial and interim assessments by the respective County Property Appraiser’s Office but, at a minimum, the interim assessments will provide a platform from which one can work to build a claim. One of the elements of “economic loss” is the diminution in value of any property measured by the difference between its assessed value on January 1, 2010 (as originally determined by the County Property Appraiser’s Office) and its diminished value set forth in the interim assessment by the County Property Appraiser.

No matter where your association is located or whether you’ve seen any oil spill activity as of yet, every association would be well advised to contact their local County Property Appraiser’s Office to urge the County to construct their respective interim assessments and to request a copy of same upon completion. Here is a link with the contact information for all 67 County Property Appraisers’ Offices:

http://dor.myflorida.com/dor/property/appraisers.html

The Governor’s action this week in issuing this Executive Order and authorizing interim property assessments underscores my previous blogs that all of our Florida communities have sadly already been impacted by the BP Oil Spill in terms of property value, the ability to obtain affordable insurance and the ability to attract willing purchasers and lenders regardless if a tar ball ever hits our shores or not. These interim property appraisals alone may serve as the basis for a diminution in value claim against not only BP but the more than dozen other defendants involved in this disaster as well.

For more information about the steps Florida communities can take to be proactive with regard to their diminished property value, please visit a special website my firm has created at www.floridaspill.com.

Tuesday, July 20, 2010

How much should your association save for a rainy day?


A reader recently asked how much money her homeowners' association should put away for future storm-related damages.

According to Wendy Murray, Director of Business Development at Associa Management and a Community Advocacy Network Broward County Advisory Council member, there is no magic formula however there are ways to project close enough to minimize the financial impact of a tropical storm or hurricane. Murray's HOA lost over 400 trees, 1,800 ficus hedges, 8 swing gates as well as some other items during Hurricane Wilma in 2005. Landscaping is not covered by most insurance so the cleanup of the trees and hedges in Murray's community alone was more than $61,000. That did not include the cost of replacing items just the cleaning up the damage wrought by Wilma.

Calculating reserves requires a projection of the estimated remaining useful life of a component and the replacement cost for such component. Since hurricanes can hit our State every year and we can also go years without one (as evidenced by the almost 5-year span since Wilma devastated us), Murray suggests funding on a 3-year cycle. If we get lucky enough not to be impacted by a storm, the reserves continue to build however you need some sort of a timetable for funding therefore she uses the number 3.

You should ask your current landscaping company to provide you with their proposal to provide storm cleanup services for the next year. You can also obtain other bids from landscapers that do not service your property. According to Murray, what you will commonly see is that an average of most bids received will fall around the range of $2,000/day for a 3-man crew, bucket truck and chipper, plus any additional dumping fees that they may incur. Your own landscape company is the most familiar with your property and should be able to project with the most accuracy the size of the crew needed (3-5 crew members a day) as well as help you identify a "temporary debris staging area." Most people forget that such a staging area is necessary.

In the event that dumps are closed, or backed up, you need to have an already designated area where you can stage the landscaping debris until it can be taken or hauled away. Murray suggests designating two debris areas: one for landscaping debris and one for construction debris. When you designate the construction debris staging area, please know that if any oils, fuels and contaminants enter into the soil, part of the cleanup will be removing all dirty soil until you get to clean fill.

Experience has taught that financial planning is the key to the financial well being of any association. While there is no magic formula when planning for emergencies requiring storm cleanup, there are ways in which to estimate associated cleanup costs. One method is to examine the costs associated with prior storm cleanups of the community, i.e. Wilma or Andrew. Obviously, this will be harder for a new community that has never experienced a storm. Even partially funding emergency reserves is better than having no funds on hand to weather a storm. In my own community, we had a beautiful live oak canopy down the main street of our community. Wilma tore it to pieces and made anything other than foot traffic impossible. We had followed the suggestions set forth above by having a fully funded emergency reserve as well as a preplanned debris removal contract with our landscaping company. Our debris was cleared within 24 hours of the storm helping us get back to normal much quicker than our neighboring communities.

Tomorrow we'll take a look at a few other suggestions proffered by Wendy Murray regarding emergency reserve funding. More of Wendy's excellent tips can also be found in our free Hurricane Preparedness Guide for Community Associations which can be downloaded off the CAN website at www.canfl.com.

Monday, July 19, 2010

Are your HOA governing documents set to expire soon?


Last week I met with a Broward County homeowners’ association that had a variety of issues they wanted to discuss. That list unfortunately did not include the fact that their Declaration of Covenants and Restrictions might have already expired by application of a 1963 law known as MRTA or the Marketable Record Title Act. The community had been represented by legal counsel for the last several years but the board related that they had never been advised about the existence of this law or its eventual impact on their ability to enforce their governing documents if the proper steps were not taken.

MRTA was originally passed at the behest of Florida’s title agents years ago to make the issuance of title policies a little less cumbersome. Rather than having to search back to Spanish land grants to ensure clear title, the law was intended to extinguish certain claims at least 30 years old or older. We’ve talked a lot about unintended consequences from legislation and the impact of MRTA on the private covenants and restrictions relied upon by HOA’s is one such example.

In the most basic terms, any covenant which is 30 or more years old from the root of title must be preserved or it will be extinguished. Condominiums are not impacted by MRTA since the transfer of condominium units via deed references the underlying Declaration of Condominium, thereby breathing new life into the Declaration in each such instance. Most HOA lots are conveyed by deeds that reference the underlying Plat for the community and NOT the underlying Declaration of Covenants and Restrictions.

Preserving documents that are still within the thirty-year time period is a relatively inexpensive and simple process requiring a board vote alone. If your governing documents have already been extinguished by application of law, the process becomes much more protracted and expensive, requires membership approval as well as approval from the Department of Community Affairs (DCA).

MRTA’s impact will be felt most keenly by HOA’s with recreational leases on their common areas, numerous recreational facilities that must be maintained, repaired, replaced and insured as well as age and other restrictions that the vast majority of the owners wish to see upheld. If the governing documents have been extinguished, the association’s ability to enforce the governing documents and collect maintenance to provide essential community services is severely jeopardized and, in some cases, eliminated entirely. I realize for some readers, this will come as welcome news as they say “Adios” to these restrictions. Others, however, might be distressed to learn that they bought into a community with certain expectations only to discover that the ability to deliver on those expectations is in jeopardy. If your HOA is more than 10 years old, it is not too soon to discuss with legal counsel what must be done to preserve your governing documents now. If your community is nearing your 30-year anniversary or is even older, you should discuss what must be done to reinstate those documents.

Wednesday, July 14, 2010

Some landlords and lawyers contribute to confusion over new rent collection law.

I received a call the other day from a woman who is renting a condominium unit in central Florida. She had done her due diligence and tried to find the most convenient location, in a well-kept community at the best price possible. What she had not counted on was receiving a letter from a law firm advising her that her landlord owed the association over $10,000 in past due assessments and that she should now tender rent directly to the association.

Here is where the story starts to get complicated. The woman’s landlord (who owns two other units in the community and is delinquent on all three of them) contacted her to advise that she should ignore any letters received from the association or its lawyer as “they can’t do anything” but warning her that he would evict her if she stopped paying rent to him. Unfortunately, the lawyer’s letter did not do a lot to allay this woman’s fears and created a few unnecessary problems as a result of its wording. By inserting a specific dollar amount owed, there might be fair debt collection issues since the debt is being disclosed to a third party and by doing so, this tenant became immediately frightened that SHE was going to be held responsible for this amount of money.

This tenant’s first question was,” If I stop paying the landlord and start paying the association pursuant to their demand, can my landlord evict me?”

The answer is that the landlord cannot evict the tenant for complying with the association’s demand for payment. The lawyer’s letter should have clearly stated this and put her mind at ease on this point.The landlord’s advice to ignore the association’s demand could result in her swift eviction so thank goodness she questioned the wisdom of that advice.

The lawyer’s letter did clearly specify that the association would not become her landlord as a result of accepting her payments. My caller’s next question was “Who should I call to fix my dishwasher as my landlord is certainly not going to be running to help me if I’m not paying him rent?” That is a pertinent question and one which associations in this situation should mull over. The goal for most associations will be to keep these tenants in the units as they represent the ONLY source for money coming from those units. As such, the rent collection approach must be thoughtfully planned and sensitively applied. In fact, in some instances, the association may ultimately wind up owning the unit and getting off on the right foot might result in having a built-in tenant at the time the association takes title.

Any demand letter must (a) comply with all applicable federal and state statutes (b) should clearly spell out that the tenant’s peaceful enjoyment will not be disturbed so long as he or she complies with the demand and (c) spell out in plain, understandable language what is happening and why. Even better, a nice phone call to the tenant in advance of that letter from either the manager or a director advising that a letter is on the way and the reason for it would go a long way towards calming any tenant fears. Of course, prior to the phone call the director or manager should run through their proposed message with legal counsel first to ensure the tone and content is appropriate.

The legislative reason behind allowing associations to collect rent from tenants in delinquent units is simple; why should delinquent owners be allowed to pocket money received from renters while their neighbors are forced to make up for them not, in turn, paying their assessments? However, having a statutory right and effectively exercising it are entirely two different things. Some of the attempts to utilize this new tool will undoubtedly miss the mark, a few will do so badly. This tenant was prepared to pack up and leave the week after receiving the association’s demand. She had not thought, however, about losing her security deposit, being subject to a possible breach of lease suit, and the inconvenience of relocating. Interestingly enough, the landlord cannot evict the tenant for paying the association but could sue the tenant for breach of lease if he or she abandoned the unit prior to the natural lease termination.

At the end of our call, this tenant had made up her mind that sending her rent check to one party or the other did not make much of a difference; it was just a different address on an envelope. However, she was very definite about looking for another unit when this lease was up. It really is an ironic turn of events when tenants start investigating their potential landlord’s credit before signing on the dotted line!

Tuesday, July 13, 2010

New law helps shine light on previously buried automatic renewal clauses!


Not surprisingly, SB 1196 has overshadowed many of the other bills that passed during the 2010 Legislative Session which have either a direct or indirect impact on common interest ownership communities throughout the State.

One of those bills, HB 751, which took effect on July 1, 2010, provides welcome relief to associations that have been plagued by pernicious automatic renewal clauses in many of their vendor contracts. Who hasn’t looked to cancel a lease agreement for laundry equipment or elevator maintenance only to find out that the original contract automatically renewed for another 5, 10 or even 15 years!! These boards are disheartened to learn that a less than careful reading of the original agreement which did not reveal a buried automatic renewal clause has now trapped them into years of additional service.

I have been preaching for years that one of the benefits of having your contracts reviewed carefully by legal counsel prior to execution is to ferret out clauses like automatic renewals that are not in the best interests of the association. This bill will make it a lot easier for an association and/or its manager to spot this type of clause as well.

This new law defines an automatic renewal clause as a provision under which a service contract is renewed for a specified period of more than 1 month if the renewal causes the service contract to be in effect more than 6 months after the day of the initiation of the service contract. Under this law, such renewal is effective unless the consumer gives notice to the seller of the consumer’s intention to terminate the service contract.

HB 751 further defines a service contract as a written contract for the performance of services over a fixed period of time or for a specified duration. In the association context, this will typically refer to a laundry lease, an elevator or roof maintenance agreement, etc.

Sellers of such service renewal contracts are now obligated to disclose the automatic renewal provision clearly and conspicuously in the contract or contract offer. Moreover, such sellers must inform potential clients of the specifics of the renewal process for service renewal contracts which run for a period of 12 months or more and which automatically renew for a period of more than one month, absent consumer cancellation.

Consumers must now be clearly informed that unless they cancel the contract, it will automatically renew, and must further be informed how they can obtain related information.

If a seller makes an error and thereby fails to comply with these new disclosure requirements, the unearned portion of the contract subject to the automatic renewal provision is refunded as of the date on which the seller is notified of the error. Moreover, a violation of this notice requirements renders the automatic renewal provision void and unenforceable.

HB 751 applies only to contracts entered into on or after July 1, 2010 so it will not help you avoid an automatic renewal provision contained in a contract you entered into prior to July 1, 2010. The hope is, however, that this new law will make it a lot less likely that associations will continue to unknowingly bind themselves by these kinds of clauses.

Monday, July 12, 2010

A Community Plan of Action Regarding the BP Oil Spill


In addition to hoping that we avoid a hurricane this season despite expert predictions to the contrary, we are also all hoping to avoid direct impact from the BP Oil Spill. However, it is becoming readily apparent that each of our communities have already been impacted by this disaster in the Gulf in terms of the following:

• The ability to obtain reasonable insurance coverage. When it comes time to renew our insurance coverage, we are undoubtedly in for a rude awakening.

• The ability to obtain financing in our communities. Lenders are already viewing properties along the coast and close to them with greater scrutiny.

• The ability to sell property. Sales contracts for waterfront properties are already being drafted to include “oil spill contingency” clauses to enable purchasers to back out with the return of their deposits should a certain percentage of oil or tar balls be present up to the day of closing.

• The diminution of our property value. The value of beachfront communities (regardless if you run a rental pool or not) derives in large part from the robust nature of our tourism. Impact tourism and you’ve impacted property value. Remove the ability to obtain reasonable and adequate insurance and you’ve negatively impacted property value. Narrow the pool of potential purchasers and potential lenders for our communities and you’ve further impacted property value.

• In addition to these areas that have already impacted our communities’ collective value, there is the likelihood for months or years to come for this oil to reach our shores, our Intracoastal and our other waterways with the attendant pollution impact and clean-up costs.

Being proactive always affords the best chance of recovering from any disaster. Here is a Plan of Action that your community may wish to consider :

1. Be Observant. Follow the news reports in your area and become knowledgeable about the likelihood of oil impact in your neighborhood and community. In addition, stay active in your neighborhoods: What are your neighbors observing? What are they talking about? It is imperative to not only learn of your community’s concerns but also to be ready to act.

If oil, in any form, is seen in or near your neighborhood, it is advisable that you contact the Florida Department of Environmental Protection (888-337-3569). Their Oil Response website can be viewed at: www.dep.state.fl.us/deepwaterhorizon. In addition, more information can be found at www.deepwaterhorizonresponse.com(soon to be www.RestoreTheGulf.com).

The following numbers and sites may also be beneficial for more specific concerns:

• Florida Oil Spill Information Line (FOSIL), available from 8 a.m.-6 p.m EDT daily:
English – (888) 337-3569
Haitian Creole – (877) 955-8707
Spanish – (877) 955-8773
TDD – (800) 955-8771
Voice – (800) 955-8770
• For general health/exposures information questions related to the oil spill, contact the Florida Poison Control Center at (800) 222-1222.

• Two public hotline numbers for oil spill investigation and cleanup:
Impacted Wildlife: (866) 557-1401
Oiled Shoreline: (877) 2-SAVE-FL or #DEP for cellular devices
• The Florida Department of State has established a hotline for archeological, historical preservation, and tribal lands that may be impacted by the Deepwater Horizon incident: (850) 245-6530.

• Volunteer registration: www.VolunteerFlorida.org and click “Register to Help”
• Health advisories: www.dep.state.fl.us/deepwaterhorizon/health.htm
• State sampling data: www.nrdata.org
• GATOR web mapping application: map.floridadisaster.org/gator/
• NOAA GeoPlatform, response management application: www.geoplatform.gov/gulfresponse/

2. Be First in Line at the Ticket Counter. Despite the fact that BP has already poured $20 billion into a Relief Fund and promised more to come, that stream will run dry eventually. Those people who queued up early will be in a much better position to recover funds than those who waited.

There are several alternatives in pursuing recoveries, including:

• Filing the proper claims and suits. In order to demand payment of damages for the loss of the use of your property, diminished value, property damage and loss of tax base, you will need to file the necessary claims under the Oil Pollution Act of 1990 (OPA);

• Filing an action in federal court against all responsible parties including BP and Halliburton; and

• Pursuing claims under the Oil Pollution Act of 1990 (OPA) through the BP Oil Claims process. Although the likelihood of recovery under the OPA fund is minimal, it is necessary in order to preserve your community’s right of recovery under the act. When BP underpays your claim or denies it, your claim will then ripen to allow for recovery in the judicial system.

3. Gather information now which will be needed later to establish damages. This information should include, at a minimum, the following going back at least three years where possible.

• For individuals: bank statements, federal and state tax returns, listings of assets, personal financial statements, relevant insurance policies, evidence of employment, evidence of personal residency, and W-2 statements and 1099s.

• For associations running rental pools, bank statements, federal and state tax returns, listings of assets, monthly and annual financial statements, relevant insurance policies, reservation terminations, loan defaults, special assessments passed and other financial restructuring events including loan defaults or bankruptcy filings and other information after the oil spill on April 20, 2010.

• For all associations, canceled purchase contracts, increased insurance premiums and increased delinquencies from investor-owned and leased units.

• Document the community’s current condition with date stamped video, photographs and where possible, engineering reports. Update such documentation periodically throughout the next 18 months.

4. Volunteer! Organize volunteer committees in your neighborhood and community. Involving your community members will not only speed your preparation efforts but will also help calm fears your residents will undoubtedly have about this disaster’s eventual impact on their homes, families and property values.
For more information, please visit a special website my Firm has created to answer your questions at www.floridaspill.com

Friday, July 9, 2010

Do you realize your Florida community has already been impacted by the BP Oil Spill?

Governor Crist just announced that our Florida lawmakers will be heading back to Tallahassee starting July 20th to deal with the ongoing BP Oil Spill crisis. Moreover, the Governor has already declared a state of emergency for 26 of our coastal counties.

We cannot currently predict the magnitude of the effects of the BP Oil Spill on our State, our country and our planet. Our losses will sadly not be confined solely to large economic losses. We watch this ecological disaster in “real time” via the internet and other technology but do we really understand how it has already impacted every Floridian and will continue to do so for years to come?

I have received numerous requests from community association members and their association managers throughout the State inquiring about what they can and should be doing right now and in the future to recover from potentially devastating and overwhelming losses. The foreclosure crisis has already taken a harsh toll on far too many of our Florida communities; it is certainly not pleasant to think about the further erosion in community health that this spill can bring. Already sales contracts around the State are being drafted with “oil spill contingencies” that will allow potential purchasers to back out of their contracts with the return of their deposits should a certain percentage of tar balls be present prior to closing. The insurance and banking industries are currently working on new business models to protect their interests, undoubtedly at the expense of our communities. Waving the white flag of surrender is not really an option and ignorance is rarely bliss in a community association. What then, should boards, managers and association members be doing right now? We will be discussing that over the next few blogs.

Wednesday, July 7, 2010

Will your tax bill this year really reflect the value of your property?

It should come as no surprise that taxable property values across Florida are at an all time low. Total taxable values in Broward County dropped 11.7% to $129.9 billion while appraised values in Miami-Dade County fell 13.4%. Palm Beach County values dropped about 10.9% with the result being that cities and counties in our State are anticipating unprecedented budget cuts to make up the difference. Raising millage rates is also an option.

Even with these significant decreases in taxable values, will the TRIM notices that will start going out in August for Broward County and thereafter for other counties really reflect what you SHOULD be paying in terms of property tax?

Each calendar year, Property Appraisers from each of the 67 Florida Counties must complete an assessment of the value of all taxable property located within their respective counties no later than July 1st of the calendar year. In making this assessment, the Property Appraiser is required to physically inspect the property at least once every 5 years.

However, where geographically suitable, and at the discretion of the Property Appraiser, image technology may be used in lieu of a physical inspection to ensure that the tax roll meets all the requirements of law. However, if the taxpayer requests that his or her property be physically inspected within that 5-year period, the Property Appraiser must comply.

To arrive at a just valuation, the Property Appraiser must take into account the following factors:

• The present cash value of the property which is the amount a willing purchaser would pay a willing seller, exclusive of reasonable closing costs, in cash or the immediate equivalent thereof in an arm’s length transaction;

• The highest and best use to which the property can be put in the immediate future and the present legal use of the property;

• The location of the property;

• The quantity or size of the property;

• The cost of the property and the present replacement value of any improvements thereon;

• The condition of the property;

• The income from the property; and

• The net proceeds of the sale of the property which shall not include closing costs, financing fees or net proceeds attributable to the sale of household furnishings or other personal property.

A taxpayer who is dissatisfied with the results of an assessment has several choices:

• Request an informal review with the County Property Appraiser’s Office to determine if an alternate value can be reached (we have been advised that some counties are routinely denying alternate valuation requested via this informal review process);

• Appeal to the Value Adjustment Board which is an entity that is independent of the County Property Appraiser’s Office; and

• Seek a judicial review of the Property Appraiser’s assessment in the Circuit Court of the County where the property is located.

How many of you feel that your tax bill really reflects the current value of your property and how many of you plan to use one of the avenues set forth above to fight your taxable value?

Thursday, July 1, 2010

Can your condominium association prevent you from smoking in your unit?

There is longstanding caselaw in our State confirming that your house may be your castle but owners in common interest ownership communities give up certain rights when they agree to be bound by the terms and provisions of the community’s governing documents. Whether you like it or not, agree or disagree, the fact remains that those living in condominiums are more highly regulated than other real property owners in terms of what they can and can’t do in their units.

Condominium owners can be prevented from having pets in their units, running businesses out of those units and placing certain items on their balconies. The question in today’s blog is whether or not those owners can be prohibited from smoking in their units if that smoke is finding its way into neighboring units and/or the hallways and other common elements. Every condominium declaration I’ve ever read contains a provision preventing owners from creating nuisances in their units which disturbs other owners’ quiet enjoyment of their property. There have been cases throughout the country which involve condominium owners suing neighbors and/or their association from smoke entering their units via air conditioning ducts, electrical outlets and/or poorly sealed or open windows and doors. In some instances, these suits have been successful after owners have shown that every effort to prevent the smoke’s entry into their homes (installing air filters, sealing windows and doors, etc.) have been unsuccessful, thereby requiring that the neighboring smoker be banned from indulging inside their property.

As far as common areas are concerned, Florida’s Clean Indoor Air Act would support an association’s ban on smoking in the Clubhouse, lobby, etc. because those areas constitute the “workplace” for association employees who maintain those areas. However, the units are private property so what is an association to do? Some communities have amended their documents to add smoking inside the units to the list of prohibited activities. Should current smokers be grandfathered in should such an amendment pass? It is common knowledge that smoking cessation is not an easy feat for long-term smokers. On the flip side, some owners with particular sensitivities to smoke are claiming that such a ban is required to reasonably accommodate their lifestyle needs.

This issue is not an easy one. Smokers are owners and enjoy the same real property rights as non-smokers. However, unwelcome smoke entering a unit is not only a nuisance but a known health risk. There will undoubtedly be more cases in the future on this issue and further clarification of where the courts, smokers and non-smokers stand.