Senate Bill sb2004c1

    Florida Senate - 2002                           CS for SB 2004

    By the Committee on Regulated Industries; and Senator Campbell





    315-2038-02

  1                      A bill to be entitled

  2         An act relating to condominiums; creating s.

  3         718.701, F.S.; providing definitions; creating

  4         s. 718.702, F.S.; providing for master

  5         association meetings; requiring certain

  6         notices; establishing meeting rules; creating

  7         s. 718.703, F.S.; providing powers of the

  8         Division of Florida Land Sales, Condominiums,

  9         and Mobile Homes over master associations;

10         creating s. 718.704, F.S.; requiring master

11         associations to provide certain financial

12         records or statements; providing an effective

13         date.

14

15  Be It Enacted by the Legislature of the State of Florida:

16

17         Section 1.  Section 718.701, Florida Statutes, is

18  created to read:

19         718.701  Definitions.--As used in ss. 718.701-718.704,

20  the term:

21         (1)  "Affected owner" means a condominium unit owner

22  that has use rights in the common property or facilities

23  administered by the master association.

24         (2)  "Master association" means any entity not covered

25  under the definition of "association" in s. 718.103(2) which

26  has been given, by an association for which control has been

27  transferred pursuant to s. 718.301, control or decision-making

28  authority over real property or facilities of the association

29  which would otherwise be controlled by that association under

30  its governing documents, and which receives moneys funded by

31  mandatory dues or assessments paid by condominium unit owners,

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    Florida Senate - 2002                           CS for SB 2004
    315-2038-02




  1  whether or not the master association has a governing body

  2  that includes representatives of the condominium association.

  3  The term does not include an entity that is granted management

  4  or maintenance responsibility under a service contract with a

  5  single association. The term also does not include any entity

  6  that has been granted or assigned decision-making authority

  7  over real property or facilities that include, in whole or in

  8  part, a timeshare plan as defined in s. 721.03.

  9         (3)  "Master association documents" means any

10  declaration of covenants and restrictions or other

11  organizational document that governs the property administered

12  by the master association and includes the bylaws and the

13  articles of incorporation of the master association.

14         (4)  "Member" means a member of the master association

15  as designated by the master association documents.

16         (5)  "Revenues" means all regular or special

17  assessments for reserves, operating or other expenses, and all

18  other sources of revenue, including interest, user fees,

19  developer subsidies, litigation proceeds, and insurance

20  proceeds.

21         Section 2.  Section 718.702, Florida Statutes, is

22  created to read:

23         718.702  Master association meetings; records.--

24         (1)  Meetings of a master association board at which a

25  quorum of board members are present are open to the members of

26  the master association and affected owners. Meetings between

27  the board or a committee and the master association attorney

28  with respect to proposed or pending litigation, or board or

29  committee meetings pertaining to legal advice, are not open to

30  the membership of the master association, and notice to the

31  membership is not required.

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    Florida Senate - 2002                           CS for SB 2004
    315-2038-02




  1         (a)  Adequate meeting notice that specifies agenda

  2  items must be given by the association in the same form and

  3  manner as notices of board of director meetings of the

  4  association to which the affected unit owners belong. Any item

  5  not included in the notice may be taken up on an emergency

  6  basis by at least a majority plus one vote of the members of

  7  the board. Such emergency action must be noticed and ratified

  8  at the next regular meeting of the board. However, written

  9  notice of any meeting at which nonemergency special

10  assessments or amendments to the rules regarding unit use will

11  be considered must be mailed or delivered to the members and

12  affected owners and posted conspicuously on the condominium

13  association property not less than 14 days prior to the

14  meeting. Evidence of compliance with the notice must be made

15  by affidavit executed by the person providing the notice and

16  must be maintained among the official records of the

17  association.

18         (b)  The right to attend such meetings includes the

19  right to speak with reference to all designated agenda items.

20  The master association may adopt written reasonable rules

21  governing the frequency, duration, and manner of unit owner

22  statements.

23         (2)  Subsection 718.111(12) applies to master

24  associations, except that references to unit owners contained

25  in that subsection apply to members and affected owners, and

26  references to condominium documents therein refer to the

27  master association documents.

28         Section 3.  Section 718.703, Florida Statutes, is

29  created to read:

30         718.703  Powers of Division of Florida Land Sales,

31  Condominiums, and Mobile Homes over master associations.--On

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    Florida Senate - 2002                           CS for SB 2004
    315-2038-02




  1  demand by the division, any condominium association must

  2  notify the division of any master association with which it is

  3  associated which is pertinent to any inquiry or investigation

  4  regarding the rights of individual unit owners, and must

  5  provide copies of documents that establish and govern the

  6  relationship between the association and the master

  7  association.

  8         Section 4.  Section 718.704, Florida Statutes, is

  9  created to read:

10         718.704  Financial reporting.--

11         (1)  If total annual revenue of a master association is

12  $100,000 or less, the association shall obtain from the master

13  association for inclusion in the association's records a

14  complete cash basis financial report of actual receipts and

15  expenditures for the prior fiscal year.

16         (2)  If total annual revenue of a master association

17  exceeds $100,000, the association shall prepare a complete set

18  of financial statements in accordance with generally accepted

19  accounting principles as follows:

20         (a)  If total annual revenue of the master association

21  exceeds $100,000 but is less than $200,000, the association

22  shall obtain from the master association for inclusion in the

23  association's records compiled financial statements.

24         (b)  If total annual revenue of the master association

25  exceeds $200,000 but is less than $400,000, the association

26  shall obtain from the master association for inclusion in the

27  association's records reviewed financial statements.

28         (c)  If total annual revenue of the master association

29  exceeds $400,000, the association shall obtain from the master

30  association for inclusion in the association's records audited

31  financial statements.

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    Florida Senate - 2002                           CS for SB 2004
    315-2038-02




  1         (3)  Master associations may exceed these reporting

  2  requirements.

  3         (4)  The association shall obtain the financial reports

  4  or statements within 90 days following the end of the fiscal

  5  year to which the reports or statements relate. The

  6  condominium association shall make the reports or statements

  7  available to condominium unit owners in the manner and form

  8  required under its governing documents, but no later than 14

  9  days after receipt.

10         (5)  This section does not limit public records or

11  disclosure requirements that are required of a master

12  association or association under their governing documents or

13  under any other provision of law.

14         Section 5.  This act shall take effect July 1, 2002.

15

16          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
17                             SB 2004

18

19  The Committee Substitute provides that to constitute a master
    association, the control or decision-making authority over
20  real property must have been given by an association for which
    control has been transferred from the developer, and the
21  development cannot include timeshare plan property or
    facilities.
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