HB 0391

CS

CHAMBER ACTION

1	The Justice Council recommends the following:
2
3	Council/Committee Substitute
4	Remove the entire bill and insert:
5	A bill to be entitled
6	An act relating to community associations; creating s.
7	712.11, F.S.; providing for the revival of certain
8	covenants that have lapsed; amending s. 718.106, F.S.;
9	prohibiting local ordinances that limit the access of
10	certain persons to beaches that adjoin condominiums;
11	amending s. 718.110, F.S.; revising provisions relating to
12	the amendment of declarations; providing legislative
13	findings and a finding of compelling state interest;
14	providing criteria for consent to an amendment; requiring
15	notice regarding proposed amendments to mortgagees;
16	providing criteria for notification; providing for voiding
17	certain amendments; amending s. 718.112, F.S.; revising
18	the implementation date for retrofitting of common areas
19	with a sprinkler system; amending s. 718.114, F.S.;
20	providing that certain leaseholds, memberships, or other
21	possessory or use interests shall be considered a material
22	alteration or substantial addition to certain real
23	property; amending s. 718.404, F.S.; providing retroactive
24	application of provisions relating to mixed-use
25	condominiums; amending s. 719.103, F.S.; providing a
26	definition; amending s. 719.507, F.S.; prohibiting laws,
27	ordinances, or regulations that apply only to improvements
28	that are or may be subjected to an equity club form of
29	ownership; amending s. 720.302, F.S.; revising governing
30	provisions relating to corporations that operate
31	residential homeowners' associations; amending s. 720.303,
32	F.S.; revising application to include certain meetings;
33	requiring the association to provide certain information
34	to prospective purchasers or lienholders; authorizing the
35	association to charge a reasonable fee for providing
36	certain information; requiring the budget to provide for
37	annual operating expenses; authorizing the budget to
38	include reserve accounts for capital expenditures and
39	deferred maintenance; providing a formula for calculating
40	the amount to be reserved; authorizing the association to
41	adjust replacement reserve assessments annually;
42	authorizing the developer to vote to waive the reserves or
43	reduce the funding of reserves for a certain period;
44	revising provisions relating to financial reporting;
45	revising time periods in which the association must
46	complete its reporting; repealing s. 720.303(2), F.S., as
47	amended, relating to board meetings, to remove conflicting
48	versions of that subsection; creating s. 720.3035, F.S.;
49	providing for architectural control covenants and parcel
50	owner improvements; authorizing the review and approval of
51	plans and specifications; providing limitations; providing
52	rights and privileges for parcel owners as set forth in
53	the declaration of covenants; amending s. 720.305, F.S.;
54	providing that, where a member is entitled to collect
55	attorney's fees against the association, the member may
56	also recover additional amounts as determined by the
57	court; amending s. 720.306, F.S.; providing that certain
58	mergers or consolidations of an association shall not be
59	considered a material or adverse alteration of the
60	proportionate voting interest appurtenant to a parcel;
61	amending s. 720.307, F.S.; requiring developers to deliver
62	financial records to the board in any transition of
63	association control to members; requiring certain
64	information to be included in the records and for the
65	records to be prepared in a specified manner; amending s.
66	720.308, F.S.; providing circumstances under which a
67	guarantee of common expenses shall be effective; providing
68	for approval of the guarantee by association members;
69	providing for a guarantee period and extension thereof;
70	requiring the stated dollar amount of the guarantee to be
71	an exact dollar amount for each parcel identified in the
72	declaration; providing payments required from the
73	guarantor to be determined in a certain manner; providing
74	a formula to determine the guarantor's total financial
75	obligation to the association; providing that certain
76	expenses incurred in the production of certain revenues
77	shall not be included in the operating expenses; amending
78	s. 720.311, F.S.; revising provisions relating to dispute
79	resolution; providing that the filing of any petition for
80	arbitration or the serving of an offer for presuit
81	mediation shall toll the applicable statute of
82	limitations; providing that certain disputes between an
83	association and a parcel owner shall be subject to presuit
84	mediation; revising provisions to conform; providing that
85	temporary injunctive relief may be sought in certain
86	disputes subject to presuit mediation; authorizing the
87	court to refer the parties to mediation under certain
88	circumstances; requiring the aggrieved party to serve on
89	the responding party a written offer to participate in
90	presuit mediation; providing a form for such offer;
91	providing that service of the offer is effected by the
92	sending of such an offer in a certain manner; providing
93	that the prevailing party in any subsequent arbitration or
94	litigation proceedings is entitled to seek recovery of all
95	costs and attorney's fees incurred in the presuit
96	mediation process; requiring the mediator or arbitrator to
97	meet certain certification requirements; removing a
98	requirement relating to development of an education
99	program to increase awareness of the operation of
100	homeowners' associations and the use of alternative
101	dispute resolution techniques; providing effective dates.
102
103	Be It Enacted by the Legislature of the State of Florida:
104
105	Section 1.  Section 712.11, Florida Statutes, is created to
106	read:
107	712.11  Covenant revitalization.--A homeowners' association
108	not otherwise subject to chapter 720 may use the procedures set
109	forth in ss. 720.403-720.407 to revive covenants that have
110	lapsed under the terms of this chapter.
111	Section 2.  Subsection (5) is added to section 718.106,
112	Florida Statutes, to read:
113	718.106  Condominium parcels; appurtenances; possession and
114	enjoyment.--
115	(5)  A local ordinance or regulation may not establish any
116	limitation on the ability of unit owners or an association to
117	permit guests, licensees, members, or invitees to use or access
118	their units or common elements for the purpose of accessing a
119	public beach or private beach adjacent to the condominium.
120	Section 3.  Effective October 1, 2006, subsection (11) of
121	section 718.110, Florida Statutes, is amended to read:
122	718.110  Amendment of declaration; correction of error or
123	omission in declaration by circuit court.--
124	(11)  The Legislature finds that the procurement of
125	mortgagee consent to amendments that do not affect the rights or
126	interests of mortgagees is an unreasonable and substantial
127	logistical and financial burden on the unit owners and that
128	there is a compelling state interest in enabling the members of
129	a condominium association to approve amendments to the
130	condominium documents through legal means. Accordingly, and
131	notwithstanding any provision to the contrary contained in this
132	section:
133	(a)  As to any mortgage recorded on or after October 1,
134	2006, any provision in the declaration, articles of
135	incorporation, or bylaws that requires recorded after April 1,
136	1992, may not require the consent or joinder of some or all
137	mortgagees of units or any other portion of the condominium
138	property to or in amendments to the declaration, articles of
139	incorporation, or bylaws or for any other matter shall be
140	enforceable only as to the following matters: unless the
141	requirement is limited to amendments materially affecting the
142	rights or interests of the mortgagees, or as otherwise required
143	by the Federal National Mortgage Association or the Federal Home
144	Loan Mortgage Corporation, and unless the requirement provides
145	that such consent may not be unreasonably withheld. It shall be
146	presumed that, except as to
147	1.  Those matters described in subsections (4) and (8).,
148	2.  Amendments to the declaration, articles of
149	incorporation, or bylaws that adversely affect the priority of
150	the mortgagee's lien or the mortgagee's rights to foreclose its
151	lien or that otherwise materially affect the rights and
152	interests of the mortgagees.
153	(b)  As to mortgages recorded before October 1, 2006, any
154	existing provisions in the declaration, articles of
155	incorporation, or bylaws requiring mortgagee consent shall be
156	enforceable.
157	(c)  In securing consent or joinder, the association shall
158	be entitled to rely upon the public records to identify the
159	holders of outstanding mortgages. The association may use the
160	address provided in the original recorded mortgage document,
161	unless there is a different address for the holder of the
162	mortgage in a recorded assignment or modification of the
163	mortgage, which recorded assignment or modification must
164	reference the official records book and page on which the
165	original mortgage was recorded. Once the association has
166	identified the recorded mortgages of record, the association
167	shall, in writing, request of each unit owner whose unit is
168	encumbered by a mortgage of record any information the owner has
169	in his or her possession regarding the name and address of the
170	person to whom mortgage payments are currently being made.
171	Notice shall be sent to such person if the address provided in
172	the original recorded mortgage document is different from the
173	name and address of the mortgagee or assignee of the mortgage as
174	shown by the public record. The association shall be deemed to
175	have complied with this requirement by making the written
176	request of the unit owners required under this paragraph. Any
177	notices required to be sent to the mortgagees under this
178	paragraph shall be sent to all available addresses provided to
179	the association.
180	(d)  Any notice to the mortgagees required under paragraph
181	(c) may be sent by a method that establishes proof of delivery,
182	and any mortgagee who fails to respond within 60 days after the
183	date of mailing shall be deemed to have consented to the
184	amendment.
185	(e)  For those amendments requiring mortgagee consent on or
186	after October 1, 2006, do not materially affect the rights or
187	interests of mortgagees. in the event mortgagee consent is
188	provided other than by properly recorded joinder, such consent
189	shall be evidenced by affidavit of the association recorded in
190	the public records of the county where the declaration is
191	recorded. Any amendment adopted without the required consent of
192	a mortgagee shall be voidable only by a mortgagee who was
193	entitled to notice and an opportunity to consent. An action to
194	void an amendment shall be subject to the statute of limitations
195	beginning 5 years from the date of discovery as to the
196	amendments described in subparagraphs (a)1. and 2. and 5 years
197	from the date of recordation of the certificate of amendment for
198	all other amendments. This provision shall apply to all
199	mortgages, regardless of the date of recordation of the
200	mortgage.
201	Section 4.  Paragraph (l) of subsection (2) of section
202	718.112, Florida Statutes, is amended to read:
203	718.112  Bylaws.--
204	(2)  REQUIRED PROVISIONS.--The bylaws shall provide for the
205	following and, if they do not do so, shall be deemed to include
206	the following:
207	(l)  Certificate of compliance.--There shall be a provision
208	that a certificate of compliance from a licensed electrical
209	contractor or electrician may be accepted by the association's
210	board as evidence of compliance of the condominium units with
211	the applicable fire and life safety code. Notwithstanding the
212	provisions of chapter 633 or of any other code, statute,
213	ordinance, administrative rule, or regulation, or any
214	interpretation of the foregoing, an association, condominium, or
215	unit owner is not obligated to retrofit the common elements or
216	units of a residential condominium with a fire sprinkler system
217	or other engineered lifesafety system in a building that has
218	been certified for occupancy by the applicable governmental
219	entity, if the unit owners have voted to forego such
220	retrofitting and engineered lifesafety system by the affirmative
221	vote of two-thirds of all voting interests in the affected
222	condominium. However, a condominium association may not vote to
223	forego the retrofitting with a fire sprinkler system of common
224	areas in a high-rise building. For purposes of this subsection,
225	the term "high-rise building" means a building that is greater
226	than 75 feet in height where the building height is measured
227	from the lowest level of fire department access to the floor of
228	the highest occupiable story. For purposes of this subsection,
229	the term "common areas" means any enclosed hallway, corridor,
230	lobby, stairwell, or entryway. In no event shall the local
231	authority having jurisdiction require completion of retrofitting
232	of common areas with a sprinkler system before the end of 2025
233	2014.
234	1.  A vote to forego retrofitting may be obtained by
235	limited proxy or by a ballot personally cast at a duly called
236	membership meeting, or by execution of a written consent by the
237	member, and shall be effective upon the recording of a
238	certificate attesting to such vote in the public records of the
239	county where the condominium is located. The association shall
240	mail, hand deliver, or electronically transmit to each unit
241	owner written notice at least 14 days prior to such membership
242	meeting in which the vote to forego retrofitting of the required
243	fire sprinkler system is to take place. Within 30 days after the
244	association's opt-out vote, notice of the results of the opt-out
245	vote shall be mailed, hand delivered, or electronically
246	transmitted to all unit owners. Evidence of compliance with this
247	30-day notice shall be made by an affidavit executed by the
248	person providing the notice and filed among the official records
249	of the association. After such notice is provided to each owner,
250	a copy of such notice shall be provided by the current owner to
251	a new owner prior to closing and shall be provided by a unit
252	owner to a renter prior to signing a lease.
253	2.  As part of the information collected annually from
254	condominiums, the division shall require condominium
255	associations to report the membership vote and recording of a
256	certificate under this subsection and, if retrofitting has been
257	undertaken, the per-unit cost of such work. The division shall
258	annually report to the Division of State Fire Marshal of the
259	Department of Financial Services the number of condominiums that
260	have elected to forego retrofitting.
261	Section 5.  Section 718.114, Florida Statutes, is amended
262	to read:
263	718.114  Association powers.--An association has the power
264	to enter into agreements, to acquire leaseholds, memberships,
265	and other possessory or use interests in lands or facilities
266	such as country clubs, golf courses, marinas, and other
267	recreational facilities. It has this power whether or not the
268	lands or facilities are contiguous to the lands of the
269	condominium, if they are intended to provide enjoyment,
270	recreation, or other use or benefit to the unit owners. All of
271	these leaseholds, memberships, and other possessory or use
272	interests existing or created at the time of recording the
273	declaration must be stated and fully described in the
274	declaration. Subsequent to the recording of the declaration,
275	agreements acquiring these leaseholds, memberships, or other
276	possessory or use interests not entered into within 12 months
277	following the recording of the declaration shall be considered a
278	material alteration or substantial addition to the real property
279	that is association property, and the association may not
280	acquire or enter into agreements acquiring these leaseholds,
281	memberships, or other possessory or use interests except as
282	authorized by the declaration as provided in s. 718.113. The
283	declaration may provide that the rental, membership fees,
284	operations, replacements, and other expenses are common expenses
285	and may impose covenants and restrictions concerning their use
286	and may contain other provisions not inconsistent with this
287	chapter. A condominium association may conduct bingo games as
288	provided in s. 849.0931.
289	Section 6.  Subsections (1) and (2) of section 718.404,
290	Florida Statutes, are amended to read:
291	718.404  Mixed-use condominiums.--When a condominium
292	consists of both residential and commercial units, the following
293	provisions shall apply:
294	(1)  The condominium documents shall not provide that the
295	owner of any commercial unit shall have the authority to veto
296	amendments to the declaration, articles of incorporation,
297	bylaws, or rules or regulations of the association. This
298	subsection shall apply retroactively as a remedial measure.
299	(2)  Subject to s. 718.301, where the number of residential
300	units in the condominium equals or exceeds 50 percent of the
301	total units operated by the association, owners of the
302	residential units shall be entitled to vote for a majority of
303	the seats on the board of administration. This subsection shall
304	apply retroactively as a remedial measure.
305	Section 7.  Subsections (18) through (27) of section
306	719.103, Florida Statutes, are renumbered as subsections (19)
307	through (28), respectively, and a new subsection (18) is added
308	to that section to read:
309	719.103  Definitions.--As used in this chapter:
310	(18)  "Equity facilities club" means a club comprised of
311	recreational facilities in which proprietary membership
312	interests are sold to individuals, which membership interests
313	entitle the individuals to use certain physical facilities owned
314	by the equity club. Such physical facilities do not include a
315	residential unit or accommodation. For purposes of this
316	definition, the term "accommodation" shall include, but is not
317	limited to, any apartment, residential cooperative unit,
318	residential condominium unit, cabin, lodge, hotel or motel room,
319	or any other accommodation designed for overnight occupancy for
320	one or more individuals.
321	Section 8.  Section 719.507, Florida Statutes, is amended
322	to read:
323	719.507  Zoning and building laws, ordinances, and
324	regulations.--All laws, ordinances, and regulations concerning
325	buildings or zoning shall be construed and applied with
326	reference to the nature and use of such property, without regard
327	to the form of ownership. No law, ordinance, or regulation shall
328	establish any requirement concerning the use, location,
329	placement, or construction of buildings or other improvements
330	which are, or may thereafter be, subjected to the cooperative or
331	equity facilities club form of ownership, unless such
332	requirement shall be equally applicable to all buildings and
333	improvements of the same kind not then, or thereafter to be,
334	subjected to the cooperative or equity facilities club form of
335	ownership. This section does not apply if the owner in fee of
336	any land enters into and records a covenant that existing
337	improvements or improvements to be constructed shall not be
338	converted to the cooperative form of residential ownership prior
339	to 5 years after the later of the date of the covenant or
340	completion date of the improvements. Such covenant shall be
341	entered into with the governing body of the municipality in
342	which the land is located or, if the land is not located in a
343	municipality, with the governing body of the county in which the
344	land is located.
345	Section 9.  Subsections (4) and (5) of section 720.302,
346	Florida Statutes, are amended to read:
347	720.302  Purposes, scope, and application.--
348	(4)  This chapter does not apply to any association that is
349	subject to regulation under chapter 718, chapter 719, or chapter
350	721; or to any nonmandatory association formed under chapter
351	723, except to the extent that a provision of chapter 718,
352	chapter 719, or chapter 721 is expressly incorporated into this
353	chapter for the purpose of regulating homeowners' associations.
354	(5)  Unless expressly stated to the contrary, corporations
355	not for profit that operate residential homeowners' associations
356	in this state shall be governed by and subject to chapter 607,
357	if the association was incorporated under that chapter, or to
358	chapter 617, if the association was incorporated under that
359	chapter, and this chapter. This subsection is intended to
360	clarify existing law.
361	Section 10.  Paragraph (a) of subsection (2), subsection
362	(6), and subsection (7) of section 720.303, Florida Statutes, as
363	amended by section 18 of chapter 2004-345 and section 135 of
364	chapter 2005-2, Laws of Florida, are amended, and paragraph (d)
365	is added to subsection (5) of that section, to read:
366	720.303  Association powers and duties; meetings of board;
367	official records; budgets; financial reporting; association
368	funds; recalls.--
369	(2)  BOARD MEETINGS.--
370	(a)  A meeting of the board of directors of an association
371	occurs whenever a quorum of the board gathers to conduct
372	association business. All meetings of the board must be open to
373	all members except for meetings between the board and its
374	attorney with respect to proposed or pending litigation where
375	the contents of the discussion would otherwise be governed by
376	the attorney-client privilege. The provisions of this subsection
377	shall also apply to the meetings of any committee or other
378	similar body when a final decision will be made regarding the
379	expenditure of association funds and to meetings of any body
380	vested with the power to approve or disapprove architectural
381	decisions with respect to a specific parcel of residential
382	property owned by a member of the community.
383	(5)  INSPECTION AND COPYING OF RECORDS.--The official
384	records shall be maintained within the state and must be open to
385	inspection and available for photocopying by members or their
386	authorized agents at reasonable times and places within 10
387	business days after receipt of a written request for access.
388	This subsection may be complied with by having a copy of the
389	official records available for inspection or copying in the
390	community. If the association has a photocopy machine available
391	where the records are maintained, it must provide parcel owners
392	with copies on request during the inspection if the entire
393	request is limited to no more than 25 pages.
394	(d)  The association or its authorized agent is not
395	required to provide a prospective purchaser or lienholder with
396	information about the residential subdivision or the association
397	other than information or documents required by this chapter to
398	be made available or disclosed. The association or its
399	authorized agent may charge a reasonable fee to the prospective
400	purchaser or lienholder or the current parcel owner or member
401	for providing good faith responses to requests for information
402	by or on behalf of a prospective purchaser or lienholder, other
403	than that required by law, if the fee does not exceed $150 plus
404	the reasonable cost of photocopying and any attorney's fees
405	incurred by the association in connection with the response.
406	(6)  BUDGETS.--
407	(a)  The association shall prepare an annual budget that
408	sets out the annual operating expenses. The budget must reflect
409	the estimated revenues and expenses for that year and the
410	estimated surplus or deficit as of the end of the current year.
411	The budget must set out separately all fees or charges paid for
412	by the association for recreational amenities, whether owned by
413	the association, the developer, or another person. The
414	association shall provide each member with a copy of the annual
415	budget or a written notice that a copy of the budget is
416	available upon request at no charge to the member. The copy must
417	be provided to the member within the time limits set forth in
418	subsection (5).
419	(b)  In addition to annual operating expenses, the budget
420	may include reserve accounts for capital expenditures and
421	deferred maintenance for which the association is responsible to
422	the extent that the governing documents do not limit increases
423	in assessments, including reserves. If the budget of the
424	association includes reserve accounts, such reserves shall be
425	determined, maintained, and waived in the manner provided in
426	this subsection. Once an association provides for reserve
427	accounts in the budget, the association shall thereafter
428	determine, maintain, and waive reserves in compliance with the
429	provisions of this subsection.
430	(c)  If the budget of the association does not provide for
431	reserve accounts governed by this subsection and the association
432	is responsible for the repair and maintenance of capital
433	improvements that may result in a special assessment if reserves
434	are not provided, each financial report for the preceding fiscal
435	year required by subsection (7) shall contain the following
436	statement in conspicuous type: THE BUDGET OF THE ASSOCIATION
437	DOES NOT PROVIDE FOR RESERVE ACCOUNTS FOR CAPITAL EXPENDITURES
438	AND DEFERRED MAINTENANCE THAT MAY RESULT IN SPECIAL ASSESSMENTS.
439	OWNERS MAY ELECT TO PROVIDE FOR RESERVE ACCOUNTS PURSUANT TO THE
440	PROVISIONS OF SECTION 720.303(6), FLORIDA STATUTES, UPON THE
441	APPROVAL OF NOT LESS THAN A MAJORITY OF THE TOTAL VOTING
442	INTERESTS OF THE ASSOCIATION.
443	(d)  An association shall be deemed to have provided for
444	reserve accounts when reserve accounts have been initially
445	established by the developer or when the membership of the
446	association affirmatively elects to provide for reserves. If
447	reserve accounts are not initially provided for by the
448	developer, the membership of the association may elect to do so
449	upon the affirmative approval of not less than a majority of the
450	total voting interests of the association. Such approval may be
451	attained by vote of the members at a duly called meeting of the
452	membership or upon a written consent executed by not less than a
453	majority of the total voting interests in the community. The
454	approval action of the membership shall state that reserve
455	accounts shall be provided for in the budget and designate the
456	components for which the reserve accounts are to be established.
457	Upon approval by the membership, the board of directors shall
458	provide for the required reserve accounts for inclusion in the
459	budget in the next fiscal year following the approval and in
460	each year thereafter. Once established as provided in this
461	subsection, the reserve accounts shall be funded or maintained
462	or shall have their funding waived in the manner provided in
463	paragraph (f).
464	(e)  The amount to be reserved in any account established
465	shall be computed by means of a formula that is based upon
466	estimated remaining useful life and estimated replacement cost
467	or deferred maintenance expense of each reserve item. The
468	association may adjust replacement reserve assessments annually
469	to take into account any changes in estimates of cost or useful
470	life of a reserve item.
471	(f)  Once a reserve account or reserve accounts are
472	established, the membership of the association, upon a majority
473	vote at a meeting at which a quorum is present, may provide for
474	no reserves or less reserves than required by this section. If a
475	meeting of the unit owners has been called to determine whether
476	to waive or reduce the funding of reserves and no such result is
477	achieved or a quorum is not present, the reserves as included in
478	the budget shall go into effect. After the turnover, the
479	developer may vote its voting interest to waive or reduce the
480	funding of reserves. Any vote taken pursuant to this subsection
481	to waive or reduce reserves shall be applicable only to one
482	budget year.
483	(g)  Funding formulas for reserves authorized by this
484	section shall be based on either a separate analysis of each of
485	the required assets or a pooled analysis of two or more of the
486	required assets.
487	1.  If the association maintains separate reserve accounts
488	for each of the required assets, the amount of the contribution
489	to each reserve account shall be the sum of the following two
490	calculations:
491	a.  The total amount necessary, if any, to bring a negative
492	component balance to zero.
493	b.  The total estimated deferred maintenance expense or
494	estimated replacement cost of the reserve component less the
495	estimated balance of the reserve component as of the beginning
496	of the period for which the budget will be in effect. The
497	remainder, if greater than zero, shall be divided by the
498	estimated remaining useful life of the component.
499
500	The formula may be adjusted each year for changes in estimates
501	and deferred maintenance performed during the year and may
502	include factors such as inflation and earnings on invested
503	funds.
504	2.  If the association maintains a pooled account of two or
505	more of the required reserve assets, the amount of the
506	contribution to the pooled reserve account as disclosed on the
507	proposed budget shall not be less than that required to ensure
508	that the balance on hand at the beginning of the period for
509	which the budget will go into effect plus the projected annual
510	cash inflows over the remaining estimated useful life of all of
511	the assets that make up the reserve pool are equal to or greater
512	than the projected annual cash outflows over the remaining
513	estimated useful lives of all of the assets that make up the
514	reserve pool, based on the current reserve analysis. The
515	projected annual cash inflows may include estimated earnings
516	from investment of principal. The reserve funding formula shall
517	not include any type of balloon payments.
518	(h)  Reserve funds and any interest accruing thereon shall
519	remain in the reserve account or accounts and shall be used only
520	for authorized reserve expenditures unless their use for other
521	purposes is approved in advance by a majority vote at a meeting
522	at which a quorum is present. Prior to turnover of control of an
523	association by a developer to parcel owners, the developer-
524	controlled association shall not vote to use reserves for
525	purposes other than those for which they were intended without
526	the approval of a majority of all nondeveloper voting interests
527	voting in person or by limited proxy at a duly called meeting of
528	the association.
529	(7)  FINANCIAL REPORTING.--Within 90 days after the end of
530	the fiscal year, or annually on the date provided in the bylaws,
531	the association shall prepare and complete, or contract with a
532	third party for the preparation and completion of, a financial
533	report for the preceding fiscal year. Within 21 days after the
534	final financial report is completed by the association or
535	received from the third party, but not later than 120 days after
536	the end of the fiscal year or other date as provided in the
537	bylaws, the association shall prepare an annual financial report
538	within 60 days after the close of the fiscal year. The
539	association shall, within the time limits set forth in
540	subsection (5), provide each member with a copy of the annual
541	financial report or a written notice that a copy of the
542	financial report is available upon request at no charge to the
543	member. Financial reports shall be prepared as follows:
544	(a)  An association that meets the criteria of this
545	paragraph shall prepare or cause to be prepared a complete set
546	of financial statements in accordance with generally accepted
547	accounting principles as adopted by the Board of Accountancy.
548	The financial statements shall be based upon the association's
549	total annual revenues, as follows:
550	1.  An association with total annual revenues of $100,000
551	or more, but less than $200,000, shall prepare compiled
552	financial statements.
553	2.  An association with total annual revenues of at least
554	$200,000, but less than $400,000, shall prepare reviewed
555	financial statements.
556	3.  An association with total annual revenues of $400,000
557	or more shall prepare audited financial statements.
558	(b)1.  An association with total annual revenues of less
559	than $100,000 shall prepare a report of cash receipts and
560	expenditures.
561	2.  An association in a community of fewer than 50 parcels,
562	regardless of the association's annual revenues, may prepare a
563	report of cash receipts and expenditures in lieu of financial
564	statements required by paragraph (a) unless the governing
565	documents provide otherwise.
566	3.  A report of cash receipts and disbursement must
567	disclose the amount of receipts by accounts and receipt
568	classifications and the amount of expenses by accounts and
569	expense classifications, including, but not limited to, the
570	following, as applicable: costs for security, professional, and
571	management fees and expenses; taxes; costs for recreation
572	facilities; expenses for refuse collection and utility services;
573	expenses for lawn care; costs for building maintenance and
574	repair; insurance costs; administration and salary expenses; and
575	reserves if maintained by the association.
576	(c)  If 20 percent of the parcel owners petition the board
577	for a level of financial reporting higher than that required by
578	this section, the association shall duly notice and hold a
579	meeting of members within 30 days of receipt of the petition for
580	the purpose of voting on raising the level of reporting for that
581	fiscal year. Upon approval of a majority of the total voting
582	interests of the parcel owners, the association shall prepare or
583	cause to be prepared, shall amend the budget or adopt a special
584	assessment to pay for the financial report regardless of any
585	provision to the contrary in the governing documents, and shall
586	provide within 90 days of the meeting or the end of the fiscal
587	year, whichever occurs later:
588	1.  Compiled, reviewed, or audited financial statements, if
589	the association is otherwise required to prepare a report of
590	cash receipts and expenditures;
591	2.  Reviewed or audited financial statements, if the
592	association is otherwise required to prepare compiled financial
593	statements; or
594	3.  Audited financial statements if the association is
595	otherwise required to prepare reviewed financial statements.
596	(d)  If approved by a majority of the voting interests
597	present at a properly called meeting of the association, an
598	association may prepare or cause to be prepared:
599	1.  A report of cash receipts and expenditures in lieu of a
600	compiled, reviewed, or audited financial statement;
601	2.  A report of cash receipts and expenditures or a
602	compiled financial statement in lieu of a reviewed or audited
603	financial statement; or
604	3.  A report of cash receipts and expenditures, a compiled
605	financial statement, or a reviewed financial statement in lieu
606	of an audited financial statement.
607	Section 11.  Subsection (2) of section 720.303, Florida
608	Statutes, as amended by section 2 of chapter 2004-345 and
609	section 15 of chapter 2004-353, Laws of Florida, is repealed.
610	Section 12.  Section 720.3035, Florida Statutes, is created
611	to read:
612	720.3035  Architectural control covenants; parcel owner
613	improvements; rights and privileges.--
614	(1)  The authority of an association or any architectural,
615	construction improvement, or other such similar committee of an
616	association to review and approve plans and specifications for
617	the location, size, type, or appearance of any structure or
618	other improvement on a parcel, or to enforce standards for the
619	external appearance of any structure or improvement located on a
620	parcel, shall only be permitted to the extent that the authority
621	is specifically stated or reasonably inferred as to such
622	location, size, type, or appearance in the declaration of
623	covenants or other published guidelines and standards authorized
624	by the declaration of covenants.
625	(2)  If the declaration of covenants or other published
626	guidelines and standards authorized by the declaration of
627	covenants provides options for the use of material, the size of
628	the structure or improvement, the design of the structure or
629	improvement, or the location of the structure or improvement on
630	the parcel, neither the association nor any architectural,
631	construction improvement, or other such similar committee of the
632	association shall restrict the right of a parcel owner to select
633	from the options provided in the declaration of covenants or
634	other published guidelines and standards authorized by the
635	declaration of covenants.
636	(3)  Unless otherwise specifically stated in the
637	declaration of covenants or other published guidelines and
638	standards authorized by the declaration of covenants, each
639	parcel shall be deemed to have only one front for purposes of
640	determining the required front setback even if the parcel is
641	bounded by a roadway or other easement on more than one side.
642	When the declaration of covenants or other published guidelines
643	and standards authorized by the declaration of covenants do not
644	provide for specific setback limitations, the applicable county
645	or municipal setback limitations shall apply, and neither the
646	association nor any architectural, construction improvement, or
647	other such similar committee of the association shall enforce or
648	attempt to enforce any setback limitation that is inconsistent
649	with the applicable county or municipal standard or standards.
650	(4)  Each parcel owner shall be entitled to the rights and
651	privileges set forth in the declaration of covenants or other
652	published guidelines and standards authorized by the declaration
653	of covenants concerning the use of the parcel, and the
654	construction of permitted structures and improvements on the
655	parcel and such rights and privileges shall not be unreasonably
656	infringed upon or impaired by the association or any
657	architectural, construction improvement, or other such similar
658	committee of the association. If the association or any
659	architectural, construction improvement, or other such similar
660	committee of the association should knowingly and willfully
661	infringe upon or impair the rights and privileges set forth in
662	the declaration of covenants or other published guidelines and
663	standards authorized by the declaration of covenants, the
664	adversely affected parcel owner shall be entitled to recover
665	damages caused by such infringement or impairment, including any
666	costs and reasonable attorney's fees incurred in preserving or
667	restoring the rights and privileges of the parcel owner set
668	forth in the declaration of covenants or other published
669	guidelines and standards authorized by the declaration of
670	covenants.
671	(5)  Neither the association nor any architectural,
672	construction improvement, or other such similar committee of the
673	association shall enforce any policy or restriction that is
674	inconsistent with the rights and privileges of a parcel owner
675	set forth in the declaration of covenants or other published
676	guidelines and standards authorized by the declaration of
677	covenants, whether uniformly applied or not. Neither the
678	association nor any architectural, construction improvement, or
679	other such similar committee of the association may rely upon a
680	policy or restriction that is inconsistent with the declaration
681	of covenants or other published guidelines and standards
682	authorized by the declaration of covenants, whether uniformly
683	applied or not, in defense of any action taken in the name of or
684	on behalf of the association against a parcel owner.
685	Section 13.  Subsection (1) of section 720.305, Florida
686	Statutes, is amended to read:
687	720.305  Obligations of members; remedies at law or in
688	equity; levy of fines and suspension of use rights; failure to
689	fill sufficient number of vacancies on board of directors to
690	constitute a quorum; appointment of receiver upon petition of
691	any member.--
692	(1)  Each member and the member's tenants, guests, and
693	invitees, and each association, are governed by, and must comply
694	with, this chapter, the governing documents of the community,
695	and the rules of the association. Actions at law or in equity,
696	or both, to redress alleged failure or refusal to comply with
697	these provisions may be brought by the association or by any
698	member against:
699	(a)  The association;
700	(b)  A member;
701	(c)  Any director or officer of an association who
702	willfully and knowingly fails to comply with these provisions;
703	and
704	(d)  Any tenants, guests, or invitees occupying a parcel or
705	using the common areas.
706
707	The prevailing party in any such litigation is entitled to
708	recover reasonable attorney's fees and costs. A member
709	prevailing in an action between the association and the member
710	under this section, in addition to recovering his or her
711	reasonable attorney's fees, may recover additional amounts as
712	determined by the court to be necessary to reimburse the member
713	for his or her share of assessments levied by the association to
714	fund its expenses of the litigation. This relief does not
715	exclude other remedies provided by law. This section does not
716	deprive any person of any other available right or remedy.
717	Section 14.  Paragraph (c) of subsection (1) of section
718	720.306, Florida Statutes, is amended to read:
719	720.306  Meetings of members; voting and election
720	procedures; amendments.--
721	(1)  QUORUM; AMENDMENTS.--
722	(c)  Unless otherwise provided in the governing documents
723	as originally recorded or permitted by this chapter or chapter
724	617, an amendment may not materially and adversely alter the
725	proportionate voting interest appurtenant to a parcel or
726	increase the proportion or percentage by which a parcel shares
727	in the common expenses of the association unless the record
728	parcel owner and all record owners of liens on the parcels join
729	in the execution of the amendment. For purposes of this section,
730	a change in quorum requirements is not an alteration of voting
731	interests. The merger or consolidation of one or more
732	associations under a plan of merger or consolidation under
733	chapter 607 or chapter 617 shall not be considered a material or
734	adverse alteration of the proportionate voting interest
735	appurtenant to a parcel.
736	Section 15.  Paragraph (t) is added to subsection (3) of
737	section 720.307, Florida Statutes, to read:
738	720.307  Transition of association control in a
739	community.--With respect to homeowners' associations:
740	(3)  At the time the members are entitled to elect at least
741	a majority of the board of directors of the homeowners'
742	association, the developer shall, at the developer's expense,
743	within no more than 90 days deliver the following documents to
744	the board:
745	(t)  The financial records, including financial statements
746	of the association, and source documents from the incorporation
747	of the association through the date of turnover. The records
748	shall be audited by an independent certified public accountant
749	for the period from the incorporation of the association or from
750	the period covered by the last audit, if an audit has been
751	performed for each fiscal year since incorporation. All
752	financial statements shall be prepared in accordance with
753	generally accepted accounting principles and shall be audited in
754	accordance with generally accepted auditing standards, as
755	prescribed by the Board of Accountancy, pursuant to chapter 473.
756	The certified public accountant performing the audit shall
757	examine to the extent necessary supporting documents and
758	records, including the cash disbursements and related paid
759	invoices to determine if expenditures were for association
760	purposes and the billings, cash receipts, and related records of
761	the association to determine that the developer was charged and
762	paid the proper amounts of assessments. This paragraph applies
763	to associations with a date of incorporation after December 31,
764	2006.
765	Section 16.  Section 720.308, Florida Statutes, is amended
766	to read:
767	720.308  Assessments and charges.--
768	(1)  ASSESSMENTS.--For any community created after October
769	1, 1995, the governing documents must describe the manner in
770	which expenses are shared and specify the member's proportional
771	share thereof. Assessments levied pursuant to the annual budget
772	or special assessment must be in the member's proportional share
773	of expenses as described in the governing document, which share
774	may be different among classes of parcels based upon the state
775	of development thereof, levels of services received by the
776	applicable members, or other relevant factors. While the
777	developer is in control of the homeowners' association, it may
778	be excused from payment of its share of the operating expenses
779	and assessments related to its parcels for any period of time
780	for which the developer has, in the declaration, obligated
781	itself to pay any operating expenses incurred that exceed the
782	assessments receivable from other members and other income of
783	the association. This section does not apply to an association,
784	no matter when created, if the association is created in a
785	community that is included in an effective development-of-
786	regional-impact development order as of the effective date of
787	this act, together with any approved modifications thereto.
788	(2)  GUARANTEES OF COMMON EXPENSES.--
789	(a)  Establishment of a guarantee.--If a guarantee of the
790	assessments of parcel owners is not included in the purchase
791	contracts or declaration, any agreement establishing a guarantee
792	shall only be effective upon the approval of a majority of the
793	voting interests of the members other than the developer.
794	Approval shall be expressed at a meeting of the members voting
795	in person or by limited proxy or by agreement in writing without
796	a meeting if provided in the bylaws. Such guarantee shall meet
797	the requirements of this section.
798	(b)  Guarantee period.--The period of time for the
799	guarantee shall be indicated by a specific beginning and ending
800	date or event.
801	1.  The ending date or event shall be the same for all of
802	the members of an association, including members in different
803	phases of the development.
804	2.  The guarantee may provide for different intervals of
805	time during a guarantee period with different dollar amounts for
806	each such interval.
807	3.  The guarantee may provide that after the initial stated
808	period, the developer has an option to extend the guarantee for
809	one or more additional stated periods. The extension of a
810	guarantee is limited to extending the ending date or event;
811	therefore, the developer does not have the option of changing
812	the level of assessments guaranteed.
813	(3)  MAXIMUM LEVEL OF ASSESSMENTS.--The stated dollar
814	amount of the guarantee shall be an exact dollar amount for each
815	parcel identified in the declaration. Regardless of the stated
816	dollar amount of the guarantee, assessments charged to a member
817	shall not exceed the maximum obligation of the member based on
818	the total amount of the adopted budget and the member's
819	proportionate ownership share of the common elements.
820	(4)  CASH FUNDING REQUIREMENTS DURING GUARANTEE.--The cash
821	payments required from the guarantor during the guarantee period
822	shall be determined as follows:
823	(a)  If at any time during the guarantee period the funds
824	collected from member assessments at the guaranteed level and
825	other revenues collected by the association are not sufficient
826	to provide payment, on a timely basis, of all assessments,
827	including the full funding of the reserves unless properly
828	waived, the guarantor shall advance sufficient cash to the
829	association at the time such payments are due.
830	(b)  Expenses incurred in the production of nonassessment
831	revenues, not in excess of the nonassessment revenues, shall not
832	be included in the assessments. If the expenses attributable to
833	nonassessment revenues exceed nonassessment revenues, only the
834	excess expenses must be funded by the guarantor. Interest earned
835	on the investment of association funds may be used to pay the
836	income tax expense incurred as a result of the investment; such
837	expense shall not be charged to the guarantor; and the net
838	investment income shall be retained by the association. Each
839	such nonassessment-revenue-generating activity shall be
840	considered separately. Any portion of the parcel assessment that
841	is budgeted for designated capital contributions of the
842	association shall not be used to pay operating expenses.
843	(5)  CALCULATION OF GUARANTOR'S FINAL OBLIGATION.--The
844	guarantor's total financial obligation to the association at the
845	end of the guarantee period shall be determined on the accrual
846	basis using the following formula: the guarantor shall pay any
847	deficits that exceed the guaranteed amount, less the total
848	regular periodic assessments earned by the association from the
849	members other than the guarantor during the guarantee period
850	regardless of whether the actual level charged was less than the
851	maximum guaranteed amount.
852	(6)  EXPENSES.--Expenses incurred in the production of
853	nonassessment revenues, not in excess of the nonassessment
854	revenues, shall not be included in the operating expenses. If
855	the expenses attributable to nonassessment revenues exceed
856	nonassessment revenues, only the excess expenses must be funded
857	by the guarantor. Interest earned on the investment of
858	association funds may be used to pay the income tax expense
859	incurred as a result of the investment; such expense shall not
860	be charged to the guarantor; and the net investment income shall
861	be retained by the association. Each such nonassessment-revenue-
862	generating activity shall be considered separately. Any portion
863	of the parcel assessment that is budgeted for designated capital
864	contributions of the association shall not be used to pay
865	operating expenses.
866	Section 17.  Section 720.311, Florida Statutes, is amended
867	to read:
868	720.311  Dispute resolution.--
869	(1)  The Legislature finds that alternative dispute
870	resolution has made progress in reducing court dockets and
871	trials and in offering a more efficient, cost-effective option
872	to litigation. The filing of any petition for mediation or
873	arbitration or the serving of an offer for presuit mediation as
874	provided for in this section shall toll the applicable statute
875	of limitations. Any recall dispute filed with the department
876	pursuant to s. 720.303(10) shall be conducted by the department
877	in accordance with the provisions of ss. 718.112(2)(j) and
878	718.1255 and the rules adopted by the division. In addition, the
879	department shall conduct mandatory binding arbitration of
880	election disputes between a member and an association pursuant
881	to s. 718.1255 and rules adopted by the division. Neither
882	election disputes nor recall disputes are eligible for presuit
883	mediation; these disputes shall be arbitrated by the department.
884	At the conclusion of the proceeding, the department shall charge
885	the parties a fee in an amount adequate to cover all costs and
886	expenses incurred by the department in conducting the
887	proceeding. Initially, the petitioner shall remit a filing fee
888	of at least $200 to the department. The fees paid to the
889	department shall become a recoverable cost in the arbitration
890	proceeding, and the prevailing party in an arbitration
891	proceeding shall recover its reasonable costs and attorney's
892	fees in an amount found reasonable by the arbitrator. The
893	department shall adopt rules to effectuate the purposes of this
894	section.
895	(2)(a)  Disputes between an association and a parcel owner
896	regarding use of or changes to the parcel or the common areas
897	and other covenant enforcement disputes, disputes regarding
898	amendments to the association documents, disputes regarding
899	meetings of the board and committees appointed by the board,
900	membership meetings not including election meetings, and access
901	to the official records of the association shall be the subject
902	of an offer filed with the department for presuit mandatory
903	mediation served by an aggrieved party before the dispute is
904	filed in court. Presuit mediation proceedings must be conducted
905	in accordance with the applicable Florida Rules of Civil
906	Procedure, and these proceedings are privileged and confidential
907	to the same extent as court-ordered mediation. Disputes subject
908	to presuit mediation under this section shall not include the
909	collection of any assessment, fine, or other financial
910	obligation, including attorney's fees and costs, claimed to be
911	due or any action to enforce a prior mediation settlement
912	agreement between the parties. Also, in any dispute subject to
913	presuit mediation under this section where emergency relief is
914	required, a motion for temporary injunctive relief may be filed
915	with the court without first complying with the presuit
916	mediation requirements of this section. After any issues
917	regarding emergency or temporary relief are resolved, the court
918	may either refer the parties to a mediation program administered
919	by the courts or require mediation under this section. An
920	arbitrator or judge may not consider any information or evidence
921	arising from the presuit mediation proceeding except in a
922	proceeding to impose sanctions for failure to attend a presuit
923	mediation session or with the parties' agreement in a proceeding
924	seeking to enforce the agreement. Persons who are not parties to
925	the dispute may not attend the presuit mediation conference
926	without the consent of all parties, except for counsel for the
927	parties and a corporate representative designated by the
928	association. When mediation is attended by a quorum of the
929	board, such mediation is not a board meeting for purposes of
930	notice and participation set forth in s. 720.303. An aggrieved
931	party shall serve on the responding party a written offer to
932	participate in presuit mediation in substantially the following
933	form:
934
935	STATUTORY OFFER TO PARTICIPATE IN PRESUIT MEDIATION
936
937	The alleged aggrieved party,__________________, hereby
938	offers to _________________, as the responding party,
939	to enter into presuit mediation in connection with the
940	following dispute, which by statute is of a type that
941	is subject to presuit mediation:
942
943	(List specific nature of the dispute or disputes to be
944	mediated and the authority supporting a finding of a
945	violation as to each dispute.)
946
947	Pursuant to section 720.311, Florida Statutes, this
948	offer to resolve the dispute through presuit mediation
949	is required before a lawsuit can be filed concerning
950	the dispute. Pursuant to the statute, the aggrieved
951	party is hereby offering to engage in presuit
952	mediation with a neutral third-party mediator in order
953	to attempt to resolve this dispute without court
954	action, and the aggrieved party demands that you
955	likewise agree to this process. If you fail to agree
956	to presuit mediation, or if you agree and later fail
957	to follow through with your agreement to mediate, suit
958	may be brought against you without further warning.
959
960	The process of mediation involves a supervised
961	negotiation process in which a trained, neutral third-
962	party mediator meets with both parties and assists
963	them in exploring possible opportunities for resolving
964	part or all of the dispute. The mediation process is a
965	voluntary one. By agreeing to participate in presuit
966	mediation, you are not bound in any way to change your
967	position or to enter into any type of agreement.
968	Furthermore, the mediator has no authority to make any
969	decisions in this matter or to determine who is right
970	or wrong and merely acts as a facilitator to ensure
971	that each party understands the position of the other
972	party and that all reasonable settlement options are
973	fully explored. All mediation communications are
974	confidential under the Mediation Confidentiality and
975	Privilege Act pursuant to sections 44.401-44.406,
976	Florida Statutes, and a mediation participant may not
977	disclose a mediation communication to a person other
978	than a mediation participant or a participant's
979	counsel.
980
981	If an agreement is reached, it shall be reduced to
982	writing and becomes a binding and enforceable
983	commitment of the parties. A resolution of one or more
984	disputes in this fashion avoids the need to litigate
985	these issues in court. The failure to reach an
986	agreement, or the failure of a party to participate in
987	the process, results in the mediator's declaring an
988	impasse in the mediation, after which the aggrieved
989	party may proceed to court on all outstanding,
990	unsettled disputes.
991
992	The aggrieved party has selected and hereby lists
993	three certified mediators who we believe to be neutral
994	and qualified to mediate the dispute. You have the
995	right to select any one of these mediators. The fact
996	that one party may be familiar with one or more of the
997	listed mediators does not mean that the mediator
998	cannot act as a neutral and impartial facilitator. Any
999	mediator who cannot act in this capacity ethically
1000	must decline to accept engagement. The mediators that
1001	we suggest, and their current hourly rates, are as
1002	follows:
1003
1004	(List the names, addresses, telephone numbers, and
1005	hourly rates of the mediators. Other pertinent
1006	information about the background of the mediators may
1007	be included as an attachment.)
1008
1009	You may contact the offices of these mediators to
1010	confirm that the listed mediators will be neutral and
1011	will not show any favoritism toward either party. The
1012	names of certified mediators may be found through the
1013	office of the clerk of the circuit court for this
1014	circuit.
1015
1016	If you agree to participate in the presuit mediation
1017	process, the statute requires that each party is to
1018	pay one-half of the costs and fees involved in the
1019	presuit mediation process unless otherwise agreed by
1020	all parties. An average mediation may require 3 to 4
1021	hours of the mediator's time, including some
1022	preparation time, and each party would need to pay
1023	one-half of the mediator's fees as well as his or her
1024	own attorney's fees if he or she chooses to employ an
1025	attorney in connection with the mediation. However,
1026	use of an attorney is not required and is at the
1027	option of each party. The mediator may require the
1028	advance payment of some or all of the anticipated
1029	fees. The aggrieved party hereby agrees to pay or
1030	prepay one-half of the mediator's estimated fees and
1031	to forward this amount or such other reasonable
1032	advance deposits as the mediator may require for this
1033	purpose. Any funds deposited will be returned to you
1034	if these are in excess of your share of the fees
1035	incurred.
1036
1037	If you agree to participate in presuit mediation in
1038	order to attempt to resolve the dispute and thereby
1039	avoid further legal action, please sign below and
1040	clearly indicate which mediator is acceptable to you.
1041	We will then ask the mediator to schedule a mutually
1042	convenient time and place for the mediation conference
1043	to be held. The mediation conference must be held
1044	within 90 days after the date of this letter unless
1045	extended by mutual written agreement. In the event
1046	that you fail to respond within 20 days after the date
1047	of this letter, or if you fail to agree to at least
1048	one of the mediators that we have suggested and to pay
1049	or prepay to the mediator one-half of the costs
1050	involved, the aggrieved party will be authorized to
1051	proceed with the filing of a lawsuit against you
1052	without further notice and may seek an award of
1053	attorney's fees or costs incurred in attempting to
1054	obtain mediation.
1055
1056	Should you wish, you may also elect to waive presuit
1057	mediation so that this matter may proceed directly to
1058	court.
1059
1060	Therefore, please give this matter your immediate
1061	attention. By law, your response must be mailed by
1062	certified mail, return receipt requested, with an
1063	additional copy being sent by regular first-class mail
1064	to the address shown on this offer.
1065
1066	_____________________
1067	_____________________
1068
1069	RESPONDING PARTY: CHOOSE ONLY ONE OF THE TWO OPTIONS
1070	BELOW. YOUR SIGNATURE INDICATES YOUR AGREEMENT TO THAT
1071	CHOICE.
1072
1073	AGREEMENT TO MEDIATE
1074
1075	The undersigned hereby agrees to participate in
1076	presuit mediation and agrees to the following mediator
1077	or mediators as acceptable to mediate this dispute:
1078
1079	(List acceptable mediator or mediators.)
1080
1081	I/we further agree to pay or prepay one-half of the
1082	mediator's fees and to forward such advance deposits
1083	as the mediator may require for this purpose.
1084
1085	_______________________
1086	Signature of responding party #1
1087
1088	_______________________
1089	Signature of responding party #2 (if applicable)(if
1090	property is owned by more than one person, all owners
1091	must sign)
1092
1093	WAIVER OF MEDIATION
1094
1095	The undersigned hereby waives the right to participate
1096	in presuit mediation of the dispute listed above and
1097	agrees to allow the aggrieved party to proceed in
1098	court on such matters.
1099
1100	__________________________
1101	Signature of responding party #1
1102
1103	___________________________
1104	Signature of responding party #2 (if applicable)(if
1105	property is owned by more than one person, all owners
1106	must sign)
1107
1108	(b)  Service of the statutory offer to participate in
1109	presuit mediation shall be effected by sending a letter in
1110	substantial conformity with the above form by certified mail,
1111	return receipt requested, with an additional copy being sent by
1112	regular first-class mail, to the address of the responding party
1113	as it last appears on the books and records of the association.
1114	The responding party shall have 20 days from the date of the
1115	mailing of the statutory offer to serve a response to the
1116	aggrieved party in writing. The response shall be served by
1117	certified mail, return receipt requested, with an additional
1118	copy being sent by regular first-class mail, to the address
1119	shown on the statutory offer. In the alternative, the responding
1120	party may waive mediation in writing. Notwithstanding the
1121	foregoing, once the parties have agreed on a mediator, the
1122	mediator may reschedule the mediation for a date and time
1123	mutually convenient to the parties. The department shall conduct
1124	the proceedings through the use of department mediators or refer
1125	the disputes to private mediators who have been duly certified
1126	by the department as provided in paragraph (c). The parties
1127	shall share the costs of presuit mediation equally, including
1128	the fee charged by the mediator, if any, unless the parties
1129	agree otherwise, and the mediator may require advance payment of
1130	its reasonable fees and costs. The failure of any party to
1131	respond to a demand or response, to agree upon a mediator, to
1132	make payment of fees and costs within the time established by
1133	the mediator, or to appear for a scheduled mediation session
1134	shall operate as an impasse in the presuit mediation by such
1135	party, entitling the other party to proceed in court and to seek
1136	an award of the costs and fees associated with the mediation.
1137	Additionally, if any presuit mediation session cannot be
1138	scheduled and conducted within 90 days after the offer to
1139	participate in mediation was filed, an impasse shall be deemed
1140	to have occurred unless both parties agree to extend this
1141	deadline. If a department mediator is used, the department may
1142	charge such fee as is necessary to pay expenses of the
1143	mediation, including, but not limited to, the salary and
1144	benefits of the mediator and any travel expenses incurred. The
1145	petitioner shall initially file with the department upon filing
1146	the disputes, a filing fee of $200, which shall be used to
1147	defray the costs of the mediation. At the conclusion of the
1148	mediation, the department shall charge to the parties, to be
1149	shared equally unless otherwise agreed by the parties, such
1150	further fees as are necessary to fully reimburse the department
1151	for all expenses incurred in the mediation.
1152	(c)(b)  If presuit mediation as described in paragraph (a)
1153	is not successful in resolving all issues between the parties,
1154	the parties may file the unresolved dispute in a court of
1155	competent jurisdiction or elect to enter into binding or
1156	nonbinding arbitration pursuant to the procedures set forth in
1157	s. 718.1255 and rules adopted by the division, with the
1158	arbitration proceeding to be conducted by a department
1159	arbitrator or by a private arbitrator certified by the
1160	department. If all parties do not agree to arbitration
1161	proceedings following an unsuccessful presuit mediation, any
1162	party may file the dispute in court. A final order resulting
1163	from nonbinding arbitration is final and enforceable in the
1164	courts if a complaint for trial de novo is not filed in a court
1165	of competent jurisdiction within 30 days after entry of the
1166	order. As to any issue or dispute that is not resolved at
1167	presuit mediation, and as to any issue that is settled at
1168	presuit mediation but is thereafter subject to an action seeking
1169	enforcement of the mediation settlement, the prevailing party in
1170	any subsequent arbitration or litigation proceeding shall be
1171	entitled to seek recovery of all costs and attorney's fees
1172	incurred in the presuit mediation process.
1173	(d)(c)  The department shall develop a certification and
1174	training program for private mediators and private arbitrators
1175	which shall emphasize experience and expertise in the area of
1176	the operation of community associations. A mediator or
1177	arbitrator shall be certified to conduct mediation or
1178	arbitration under this section by the department only if he or
1179	she has been certified as a circuit court civil mediator or
1180	arbitrator, respectively, pursuant to the requirements
1181	established attended at least 20 hours of training in mediation
1182	or arbitration, as appropriate, and only if the applicant has
1183	mediated or arbitrated at least 10 disputes involving community
1184	associations within 5 years prior to the date of the
1185	application, or has mediated or arbitrated 10 disputes in any
1186	area within 5 years prior to the date of application and has
1187	completed 20 hours of training in community association
1188	disputes. In order to be certified by the department, any
1189	mediator must also be certified by the Florida Supreme Court.
1190	The department may conduct the training and certification
1191	program within the department or may contract with an outside
1192	vendor to perform the training or certification. The expenses of
1193	operating the training and certification and training program
1194	shall be paid by the moneys and filing fees generated by the
1195	arbitration of recall and election disputes and by the mediation
1196	of those disputes referred to in this subsection and by the
1197	training fees.
1198	(e)(d)  The presuit mediation procedures provided by this
1199	subsection may be used by a Florida corporation responsible for
1200	the operation of a community in which the voting members are
1201	parcel owners or their representatives, in which membership in
1202	the corporation is not a mandatory condition of parcel
1203	ownership, or which is not authorized to impose an assessment
1204	that may become a lien on the parcel.
1205	(3)  The department shall develop an education program to
1206	assist homeowners, associations, board members, and managers in
1207	understanding and increasing awareness of the operation of
1208	homeowners' associations pursuant to this chapter and in
1209	understanding the use of alternative dispute resolution
1210	techniques in resolving disputes between parcel owners and
1211	associations or between owners. Such education program may
1212	include the development of pamphlets and other written
1213	instructional guides, the holding of classes and meetings by
1214	department employees or outside vendors, as the department
1215	determines, and the creation and maintenance of a website
1216	containing instructional materials. The expenses of operating
1217	the education program shall be initially paid by the moneys and
1218	filing fees generated by the arbitration of recall and election
1219	disputes and by the mediation of those disputes referred to in
1220	this subsection.
1221	Section 18.  Except as otherwise expressly provided in this
1222	act, this act shall take effect July 1, 2006.

CODING: Words stricken are deletions; words underlined are additions.