CS/HB 433

A bill to be entitled
2An act relating to community associations; creating s.
3712.11, F.S.; providing for the revival of certain
4covenants that have lapsed; amending s. 718.106, F.S.;
5prohibiting local governments from limiting the access of
6certain persons to beaches adjacent to or adjoining
7condominium property; amending s. 718.110, F.S.; revising
8provisions relating to the amendment of declarations;
9providing legislative findings and a finding of compelling
10state interest; providing criteria for consent to an
11amendment; requiring notice regarding proposed amendments
12to mortgagees; providing criteria for notification;
13providing for voiding certain amendments; amending s.
14718.114, F.S.; providing that certain agreements to
15acquire leaseholds, memberships, or other possessory or
16use interests shall be considered a material alteration or
17substantial addition to certain real property; amending s.
18718.404, F.S.; providing retroactive application of
19provisions relating to mixed-use condominiums; amending s.
20719.103, F.S.; providing a definition; amending s.
21719.507, F.S.; prohibiting laws, ordinances, or
22regulations that apply only to improvements that are or
23may be subjected to an equity club form of ownership;
24amending s. 720.302, F.S.; revising governing provisions
25relating to corporations that operate residential
26homeowners' associations; amending s. 720.303, F.S.;
27revising application to include certain meetings;
28requiring the association to provide certain information
29to prospective purchasers or lienholders; authorizing the
30association to charge a reasonable fee for providing
31certain information; requiring the budget to provide for
32annual operating expenses; authorizing the budget to
33include reserve accounts for capital expenditures and
34deferred maintenance; providing a formula for calculating
35the amount to be reserved; authorizing the association to
36adjust replacement reserve assessments annually;
37authorizing the developer to vote to waive the reserves or
38reduce the funding of reserves for a certain period;
39revising provisions relating to financial reporting;
40revising time periods in which the association must
41complete its reporting; requiring financial statements to
42be prepared in accordance with generally accepted
43accounting principles as adopted by the Board of
44Accountancy; repealing s. 720.303(2), F.S., as amended,
45relating to board meetings, to remove conflicting versions
46of that subsection; creating s. 720.3035, F.S.; providing
47for architectural control covenants and parcel owner
48improvements; authorizing the review and approval of plans
49and specifications; providing limitations; providing
50rights and privileges for parcel owners as set forth in
51the declaration of covenants; amending s. 720.305, F.S.;
52providing that, where a member is entitled to collect
53attorney's fees against the association, the member may
54also recover additional amounts as determined by the
55court; amending s. 720.306, F.S.; providing that certain
56mergers or consolidations of an association shall not be
57considered a material or adverse alteration of the
58proportionate voting interest appurtenant to a parcel;
59amending s. 720.307, F.S.; requiring developers to deliver
60financial records to the board in any transition of
61association control to members; requiring certain
62information to be included in the records and for the
63records to be prepared in a specified manner; providing
64application; amending s. 720.308, F.S.; providing
65circumstances under which a guarantee of common expenses
66shall be effective; providing for approval of the
67guarantee by association members; providing for a
68guarantee period and extension thereof; requiring the
69stated dollar amount of the guarantee to be an exact
70dollar amount for each parcel identified in the
71declaration; providing payments required from the
72guarantor to be determined in a certain manner; providing
73a formula to determine the guarantor's total financial
74obligation to the association; providing that certain
75expenses incurred in the production of certain revenues
76shall not be included in the operating expenses; amending
77s. 720.311, F.S.; revising provisions relating to dispute
78resolution; providing that the filing of any petition for
79arbitration or the serving of an offer for presuit
80mediation shall toll the applicable statute of
81limitations; providing that certain disputes between an
82association and a parcel owner shall be subject to presuit
83mediation; revising provisions to conform; providing that
84temporary injunctive relief may be sought in certain
85disputes subject to presuit mediation; authorizing the
86court to refer the parties to mediation under certain
87circumstances; requiring the aggrieved party to serve on
88the responding party a written offer to participate in
89presuit mediation; providing a form for such offer;
90providing that service of the offer is effected by the
91sending of such an offer in a certain manner; providing
92that the prevailing party in any subsequent arbitration or
93litigation proceedings is entitled to seek recovery of all
94costs and attorney's fees incurred in the presuit
95mediation process; requiring the mediator or arbitrator to
96meet certain certification requirements; removing a
97requirement relating to development of an education
98program to increase awareness of the operation of
99homeowners' associations and the use of alternative
100dispute resolution techniques; providing effective dates.
102Be It Enacted by the Legislature of the State of Florida:
104     Section 1.  Section 712.11, Florida Statutes, is created to
106     712.11  Covenant revitalization.--A homeowners' association
107not otherwise subject to chapter 720 may use the procedures set
108forth in ss. 720.403-720.407 to revive covenants that have
109lapsed under the terms of this chapter.
110     Section 2.  Subsection (5) is added to section 718.106,
111Florida Statutes, to read:
112     718.106  Condominium parcels; appurtenances; possession and
114     (5)  A local government may not adopt an ordinance or
115regulation that prohibits condominium unit owners or their
116guests, licensees, or invitees from pedestrian access to a
117public beach contiguous to a condominium property, except where
118necessary to protect public health, safety, or natural
119resources. Nothing in this subsection shall prohibit a
120governmental entity from enacting regulations governing
121activities taking place on the beach.
122     Section 3.  Effective October 1, 2007, subsection (11) of
123section 718.110, Florida Statutes, is amended to read:
124     718.110  Amendment of declaration; correction of error or
125omission in declaration by circuit court.--
126     (11)  The Legislature finds that the procurement of
127mortgagee consent to amendments that do not affect the rights or
128interests of mortgagees is an unreasonable and substantial
129logistical and financial burden on the unit owners and that
130there is a compelling state interest in enabling the members of
131a condominium association to approve amendments to the
132condominium documents through legal means. Accordingly, and
133notwithstanding any provision to the contrary contained in this
135     (a)  As to any mortgage recorded on or after October 1,
1362007, any provision in the declaration, articles of
137incorporation, or bylaws that requires recorded after April 1,
1381992, may not require the consent or joinder of some or all
139mortgagees of units or any other portion of the condominium
140property to or in amendments to the declaration, articles of
141incorporation, or bylaws or for any other matter shall be
142enforceable only as to the following matters: unless the
143requirement is limited to amendments materially affecting the
144rights or interests of the mortgagees, or as otherwise required
145by the Federal National Mortgage Association or the Federal Home
146Loan Mortgage Corporation, and unless the requirement provides
147that such consent may not be unreasonably withheld. It shall be
148presumed that, except as to
149     1.  Those matters described in subsections (4) and (8).,
150     2.  Amendments to the declaration, articles of
151incorporation, or bylaws that adversely affect the priority of
152the mortgagee's lien or the mortgagee's rights to foreclose its
153lien or that otherwise materially affect the rights and
154interests of the mortgagees.
155     (b)  As to mortgages recorded before October 1, 2007, any
156existing provision in the declaration, articles of
157incorporation, or bylaws requiring mortgagee consent shall be
159     (c)  In securing consent or joinder, the association shall
160be entitled to rely upon public records to identify the holders
161of outstanding mortgages. The association may use the address
162provided in the original recorded mortgage document, unless
163there is a different address for the holder of the mortgage in a
164recorded assignment or modification of the mortgage, which
165recorded assignment or modification must reference the official
166records book and page on which the original mortgage was
167recorded. Once the association has identified the recorded
168mortgages of record, the association shall, in writing, request
169of each unit owner whose unit is encumbered by a mortgage of
170record any information the owner has in his or her possession
171regarding the name and address of the person to whom mortgage
172payments are currently being made. Notice shall be sent to such
173person if the name and address provided in the original recorded
174mortgage document is different from the name and address of the
175mortgagee or assignee of the mortgage as shown by the public
176record. The association shall be deemed to have complied with
177this requirement by making the written request of the unit
178owners required under this paragraph. Any notice required to be
179sent to the mortgagees under this paragraph shall be sent to all
180available addresses provided to the association.
181     (d)  Any notice to the mortgagees required under paragraph
182(c) may be sent by a method that establishes proof of delivery,
183and any mortgagee who fails to respond within 60 days after the
184date of mailing shall be deemed to have consented to the
186     (e)  For those amendments requiring mortgagee consent on or
187after October 1, 2007, do not materially affect the rights or
188interests of mortgagees. in the event mortgagee consent is
189provided other than by properly recorded joinder, such consent
190shall be evidenced by affidavit of the association recorded in
191the public records of the county where the declaration is
192recorded. Any amendment adopted without the required consent of
193a mortgagee shall be voidable only by a mortgagee who was
194entitled to notice and an opportunity to consent. An action to
195void an amendment shall be subject to the statute of limitations
196beginning 5 years after the date of discovery as to the
197amendments described in subparagraphs (a)1. and 2. and 5 years
198after the date of recordation of the certificate of amendment
199for all other amendments. This provision shall apply to all
200mortgages, regardless of the date of recordation of the
202     (f)  Notwithstanding the provisions of this section, any
203amendment or amendments to conform a declaration of condominium
204to the insurance coverage provisions in s. 718.111(11) may be
205made as provided in that section.
206     Section 4.  Section 718.114, Florida Statutes, is amended
207to read:
208     718.114  Association powers.--An association has the power
209to enter into agreements, to acquire leaseholds, memberships,
210and other possessory or use interests in lands or facilities
211such as country clubs, golf courses, marinas, and other
212recreational facilities. It has this power whether or not the
213lands or facilities are contiguous to the lands of the
214condominium, if they are intended to provide enjoyment,
215recreation, or other use or benefit to the unit owners. All of
216these leaseholds, memberships, and other possessory or use
217interests existing or created at the time of recording the
218declaration must be stated and fully described in the
219declaration. Subsequent to the recording of the declaration,
220agreements to acquire these leaseholds, memberships, or other
221possessory or use interests not entered into within 12 months
222following the recording of the declaration shall be considered a
223material alteration or substantial addition to the real property
224that is association property, and the association may not
225acquire or enter into agreements acquiring these leaseholds,
226memberships, or other possessory or use interests except as
227authorized by the declaration as provided in s. 718.113. The
228declaration may provide that the rental, membership fees,
229operations, replacements, and other expenses are common expenses
230and may impose covenants and restrictions concerning their use
231and may contain other provisions not inconsistent with this
232chapter. A condominium association may conduct bingo games as
233provided in s. 849.0931.
234     Section 5.  Subsections (1) and (2) of section 718.404,
235Florida Statutes, are amended to read:
236     718.404  Mixed-use condominiums.--When a condominium
237consists of both residential and commercial units, the following
238provisions shall apply:
239     (1)  The condominium documents shall not provide that the
240owner of any commercial unit shall have the authority to veto
241amendments to the declaration, articles of incorporation,
242bylaws, or rules or regulations of the association. This
243subsection shall apply retroactively as a remedial measure.
244     (2)  Subject to s. 718.301, where the number of residential
245units in the condominium equals or exceeds 50 percent of the
246total units operated by the association, owners of the
247residential units shall be entitled to vote for a majority of
248the seats on the board of administration. This subsection shall
249apply retroactively as a remedial measure.
250     Section 6.  Subsections (18) through (27) of section
251719.103, Florida Statutes, are renumbered as subsections (19)
252through (28), respectively, and a new subsection (18) is added
253to that section to read:
254     719.103  Definitions.--As used in this chapter:
255     (18)  "Equity facilities club" means a club comprised of
256recreational facilities in which proprietary membership
257interests are sold to individuals, which membership interests
258entitle the individuals to use certain physical facilities owned
259by the equity club. Such physical facilities do not include a
260residential unit or accommodation. For purposes of this
261definition, the term "accommodation" shall include, but is not
262limited to, any apartment, residential cooperative unit,
263residential condominium unit, cabin, lodge, hotel or motel room,
264or other accommodation designed for overnight occupancy for one
265or more individuals.
266     Section 7.  Section 719.507, Florida Statutes, is amended
267to read:
268     719.507  Zoning and building laws, ordinances, and
269regulations.--All laws, ordinances, and regulations concerning
270buildings or zoning shall be construed and applied with
271reference to the nature and use of such property, without regard
272to the form of ownership. No law, ordinance, or regulation shall
273establish any requirement concerning the use, location,
274placement, or construction of buildings or other improvements
275which are, or may thereafter be, subjected to the cooperative or
276equity facilities club form of ownership, unless such
277requirement shall be equally applicable to all buildings and
278improvements of the same kind not then, or thereafter to be,
279subjected to the cooperative or equity facilities club form of
280ownership. This section does not apply if the owner in fee of
281any land enters into and records a covenant that existing
282improvements or improvements to be constructed shall not be
283converted to the cooperative form of residential ownership prior
284to 5 years after the later of the date of the covenant or
285completion date of the improvements. Such covenant shall be
286entered into with the governing body of the municipality in
287which the land is located or, if the land is not located in a
288municipality, with the governing body of the county in which the
289land is located.
290     Section 8.  Subsections (4) and (5) of section 720.302,
291Florida Statutes, are amended to read:
292     720.302  Purposes, scope, and application.--
293     (4)  This chapter does not apply to any association that is
294subject to regulation under chapter 718, chapter 719, or chapter
295721; or to any nonmandatory association formed under chapter
296723, except to the extent that a provision of chapter 718,
297chapter 719, or chapter 721 is expressly incorporated into this
298chapter for the purpose of regulating homeowners' associations.
299     (5)  Unless expressly stated to the contrary, corporations
300not for profit that operate residential homeowners' associations
301in this state shall be governed by and subject to chapter 607,
302if the association was incorporated under that chapter, or to
303chapter 617, if the association was incorporated under that
304chapter, and this chapter. This subsection is intended to
305clarify existing law.
306     Section 9.  Subsections (2), (6), and (7) of section
307720.303, Florida Statutes, are amended, and paragraph (d) is
308added to subsection (5) of that section, to read:
309     720.303  Association powers and duties; meetings of board;
310official records; budgets; financial reporting; association
311funds; recalls.--
312     (2)  BOARD MEETINGS.--
313     (a)  A meeting of the board of directors of an association
314occurs whenever a quorum of the board gathers to conduct
315association business. All meetings of the board must be open to
316all members except for meetings between the board and its
317attorney with respect to proposed or pending litigation where
318the contents of the discussion would otherwise be governed by
319the attorney-client privilege. The provisions of this subsection
320shall also apply to the meetings of any committee or other
321similar body when a final decision will be made regarding the
322expenditure of association funds and to meetings of any body
323vested with the power to approve or disapprove architectural
324decisions with respect to a specific parcel of residential
325property owned by a member of the community.
326     (b)  Members have the right to attend all meetings of the
327board and to speak on any matter placed on the agenda by
328petition of the voting interests for at least 3 minutes. The
329association may adopt written reasonable rules expanding the
330right of members to speak and governing the frequency, duration,
331and other manner of member statements, which rules must be
332consistent with this paragraph and may include a sign-up sheet
333for members wishing to speak. Notwithstanding any other law, the
334requirement that board meetings and committee meetings be open
335to the members is inapplicable to meetings between the board or
336a committee and the association's attorney, with respect to
337meetings of the board held for the purpose of discussing
338personnel matters.
339     (c)  The bylaws shall provide for giving notice to parcel
340owners and members of all board meetings and, if they do not do
341so, shall be deemed to provide the following:
342     1.  Notices of all board meetings must be posted in a
343conspicuous place in the community at least 48 hours in advance
344of a meeting, except in an emergency.  In the alternative, if
345notice is not posted in a conspicuous place in the community,
346notice of each board meeting must be mailed or delivered to each
347member at least 7 days before the meeting, except in an
348emergency. Notwithstanding this general notice requirement, for
349communities with more than 100 members, the bylaws may provide
350for a reasonable alternative to posting or mailing of notice for
351each board meeting, including publication of notice, provision
352of a schedule of board meetings, or the conspicuous posting and
353repeated broadcasting of the notice on a closed-circuit cable
354television system serving the homeowners' association. However,
355if broadcast notice is used in lieu of a notice posted
356physically in the community, the notice must be broadcast at
357least four times every broadcast hour of each day that a posted
358notice is otherwise required. When broadcast notice is provided,
359the notice and agenda must be broadcast in a manner and for a
360sufficient continuous length of time so as to allow an average
361reader to observe the notice and read and comprehend the entire
362content of the notice and the agenda. The bylaws or amended
363bylaws may provide for giving notice by electronic transmission
364in a manner authorized by law for meetings of the board of
365directors, committee meetings requiring notice under this
366section, and annual and special meetings of the members;
367however, a member must consent in writing to receiving notice by
368electronic transmission.
369     2.  An assessment may not be levied at a board meeting
370unless the notice of the meeting includes a statement that
371assessments will be considered and the nature of the
372assessments. Written notice of any meeting at which special
373assessments will be considered or at which amendments to rules
374regarding parcel use will be considered must be mailed,
375delivered, or electronically transmitted to the members and
376parcel owners and posted conspicuously on the property or
377broadcast on closed-circuit cable television not less than 14
378days before the meeting.
379     3.  Directors may not vote by proxy or by secret ballot at
380board meetings, except that secret ballots may be used in the
381election of officers. This subsection also applies to the
382meetings of any committee or other similar body, when a final
383decision will be made regarding the expenditure of association
384funds, and to any body vested with the power to approve or
385disapprove architectural decisions with respect to a specific
386parcel of residential property owned by a member of the
388     (d)  If 20 percent of the total voting interests petition
389the board to address an item of business, the board shall at its
390next regular board meeting or at a special meeting of the board,
391but not later than 60 days after the receipt of the petition,
392take the petitioned item up on an agenda. The board shall give
393all members notice of the meeting at which the petitioned item
394shall be addressed in accordance with the 14-day notice
395requirement pursuant to subparagraph (c)2. Each member shall
396have the right to speak for at least 3 minutes on each matter
397placed on the agenda by petition, provided that the member signs
398the sign-up sheet, if one is provided, or submits a written
399request to speak prior to the meeting. Other than addressing the
400petitioned item at the meeting, the board is not obligated to
401take any other action requested by the petition.
402     (5)  INSPECTION AND COPYING OF RECORDS.--The official
403records shall be maintained within the state and must be open to
404inspection and available for photocopying by members or their
405authorized agents at reasonable times and places within 10
406business days after receipt of a written request for access.
407This subsection may be complied with by having a copy of the
408official records available for inspection or copying in the
409community. If the association has a photocopy machine available
410where the records are maintained, it must provide parcel owners
411with copies on request during the inspection if the entire
412request is limited to no more than 25 pages.
413     (d)  The association or its authorized agent is not
414required to provide a prospective purchaser or lienholder with
415information about the residential subdivision or the association
416other than information or documents required by this chapter to
417be made available or disclosed. The association or its
418authorized agent may charge a reasonable fee to the prospective
419purchaser or lienholder or the current parcel owner or member
420for providing good faith responses to requests for information
421by or on behalf of a prospective purchaser or lienholder, other
422than that required by law, if the fee does not exceed $150 plus
423the reasonable cost of photocopying and any attorney's fees
424incurred by the association in connection with the response.
425     (6)  BUDGETS.--
426     (a)  The association shall prepare an annual budget that
427sets out the annual operating expenses. The budget must reflect
428the estimated revenues and expenses for that year and the
429estimated surplus or deficit as of the end of the current year.
430The budget must set out separately all fees or charges paid for
431by the association for recreational amenities, whether owned by
432the association, the developer, or another person. The
433association shall provide each member with a copy of the annual
434budget or a written notice that a copy of the budget is
435available upon request at no charge to the member. The copy must
436be provided to the member within the time limits set forth in
437subsection (5).
438     (b)  In addition to annual operating expenses, the budget
439may include reserve accounts for capital expenditures and
440deferred maintenance for which the association is responsible to
441the extent that the governing documents do not limit increases
442in assessments, including reserves. If the budget of the
443association includes reserve accounts, such reserves shall be
444determined, maintained, and waived in the manner provided in
445this subsection. Once an association provides for reserve
446accounts in the budget, the association shall thereafter
447determine, maintain, and waive reserves in compliance with this
449     (c)  If the budget of the association does not provide for
450reserve accounts governed by this subsection and the association
451is responsible for the repair and maintenance of capital
452improvements that may result in a special assessment if reserves
453are not provided, each financial report for the preceding fiscal
454year required by subsection (7) shall contain the following
455statement in conspicuous type: THE BUDGET OF THE ASSOCIATION
462     (d)  An association shall be deemed to have provided for
463reserve accounts when reserve accounts have been initially
464established by the developer or when the membership of the
465association affirmatively elects to provide for reserves. If
466reserve accounts are not initially provided for by the
467developer, the membership of the association may elect to do so
468upon the affirmative approval of not less than a majority of the
469total voting interests of the association. Such approval may be
470attained by vote of the members at a duly called meeting of the
471membership or upon a written consent executed by not less than a
472majority of the total voting interests in the community. The
473approval action of the membership shall state that reserve
474accounts shall be provided for in the budget and designate the
475components for which the reserve accounts are to be established.
476Upon approval by the membership, the board of directors shall
477provide for the required reserve accounts for inclusion in the
478budget in the next fiscal year following the approval and in
479each year thereafter. Once established as provided in this
480subsection, the reserve accounts shall be funded or maintained
481or shall have their funding waived in the manner provided in
482paragraph (f).
483     (e)  The amount to be reserved in any account established
484shall be computed by means of a formula that is based upon
485estimated remaining useful life and estimated replacement cost
486or deferred maintenance expense of each reserve item. The
487association may adjust replacement reserve assessments annually
488to take into account any changes in estimates of cost or useful
489life of a reserve item.
490     (f)  Once a reserve account or reserve accounts are
491established, the membership of the association, upon a majority
492vote at a meeting at which a quorum is present, may provide for
493no reserves or less reserves than required by this section. If a
494meeting of the unit owners has been called to determine whether
495to waive or reduce the funding of reserves and no such result is
496achieved or a quorum is not present, the reserves as included in
497the budget shall go into effect. After the turnover, the
498developer may vote its voting interest to waive or reduce the
499funding of reserves. Any vote taken pursuant to this subsection
500to waive or reduce reserves shall be applicable only to one
501budget year.
502     (g)  Funding formulas for reserves authorized by this
503section shall be based on either a separate analysis of each of
504the required assets or a pooled analysis of two or more of the
505required assets.
506     1.  If the association maintains separate reserve accounts
507for each of the required assets, the amount of the contribution
508to each reserve account shall be the sum of the following two
510     a.  The total amount necessary, if any, to bring a negative
511component balance to zero.
512     b.  The total estimated deferred maintenance expense or
513estimated replacement cost of the reserve component less the
514estimated balance of the reserve component as of the beginning
515of the period for which the budget will be in effect. The
516remainder, if greater than zero, shall be divided by the
517estimated remaining useful life of the component.
519The formula may be adjusted each year for changes in estimates
520and deferred maintenance performed during the year and may
521include factors such as inflation and earnings on invested
523     2.  If the association maintains a pooled account of two or
524more of the required reserve assets, the amount of the
525contribution to the pooled reserve account as disclosed on the
526proposed budget shall not be less than that required to ensure
527that the balance on hand at the beginning of the period for
528which the budget will go into effect plus the projected annual
529cash inflows over the remaining estimated useful life of all of
530the assets that make up the reserve pool are equal to or greater
531than the projected annual cash outflows over the remaining
532estimated useful lives of all of the assets that make up the
533reserve pool, based on the current reserve analysis. The
534projected annual cash inflows may include estimated earnings
535from investment of principal. The reserve funding formula shall
536not include any type of balloon payments.
537     (h)  Reserve funds and any interest accruing thereon shall
538remain in the reserve account or accounts and shall be used only
539for authorized reserve expenditures unless their use for other
540purposes is approved in advance by a majority vote at a meeting
541at which a quorum is present. Prior to turnover of control of an
542association by a developer to parcel owners, the developer-
543controlled association shall not vote to use reserves for
544purposes other than those for which they were intended without
545the approval of a majority of all nondeveloper voting interests
546voting in person or by limited proxy at a duly called meeting of
547the association.
548     (7)  FINANCIAL REPORTING.--Within 90 days after the end of
549the fiscal year, or annually on the date provided in the bylaws,
550the association shall prepare and complete, or contract with a
551third party for the preparation and completion of, a financial
552report for the preceding fiscal year. Within 21 days after the
553final financial report is completed by the association or
554received from the third party, but not later than 120 days after
555the end of the fiscal year or other date as provided in the
556bylaws, the association shall prepare an annual financial report
557within 60 days after the close of the fiscal year. The
558association shall, within the time limits set forth in
559subsection (5), provide each member with a copy of the annual
560financial report or a written notice that a copy of the
561financial report is available upon request at no charge to the
562member. Financial reports shall be prepared as follows:
563     (a)  An association that meets the criteria of this
564paragraph shall prepare or cause to be prepared a complete set
565of financial statements in accordance with generally accepted
566accounting principles as adopted by the Board of Accountancy.
567The financial statements shall be based upon the association's
568total annual revenues, as follows:
569     1.  An association with total annual revenues of $100,000
570or more, but less than $200,000, shall prepare compiled
571financial statements.
572     2.  An association with total annual revenues of at least
573$200,000, but less than $400,000, shall prepare reviewed
574financial statements.
575     3.  An association with total annual revenues of $400,000
576or more shall prepare audited financial statements.
577     (b)1.  An association with total annual revenues of less
578than $100,000 shall prepare a report of cash receipts and
580     2.  An association in a community of fewer than 50 parcels,
581regardless of the association's annual revenues, may prepare a
582report of cash receipts and expenditures in lieu of financial
583statements required by paragraph (a) unless the governing
584documents provide otherwise.
585     3.  A report of cash receipts and disbursement must
586disclose the amount of receipts by accounts and receipt
587classifications and the amount of expenses by accounts and
588expense classifications, including, but not limited to, the
589following, as applicable: costs for security, professional, and
590management fees and expenses; taxes; costs for recreation
591facilities; expenses for refuse collection and utility services;
592expenses for lawn care; costs for building maintenance and
593repair; insurance costs; administration and salary expenses; and
594reserves if maintained by the association.
595     (c)  If 20 percent of the parcel owners petition the board
596for a level of financial reporting higher than that required by
597this section, the association shall duly notice and hold a
598meeting of members within 30 days of receipt of the petition for
599the purpose of voting on raising the level of reporting for that
600fiscal year. Upon approval of a majority of the total voting
601interests of the parcel owners, the association shall prepare or
602cause to be prepared, shall amend the budget or adopt a special
603assessment to pay for the financial report regardless of any
604provision to the contrary in the governing documents, and shall
605provide within 90 days of the meeting or the end of the fiscal
606year, whichever occurs later:
607     1.  Compiled, reviewed, or audited financial statements, if
608the association is otherwise required to prepare a report of
609cash receipts and expenditures;
610     2.  Reviewed or audited financial statements, if the
611association is otherwise required to prepare compiled financial
612statements; or
613     3.  Audited financial statements if the association is
614otherwise required to prepare reviewed financial statements.
615     (d)  If approved by a majority of the voting interests
616present at a properly called meeting of the association, an
617association may prepare or cause to be prepared:
618     1.  A report of cash receipts and expenditures in lieu of a
619compiled, reviewed, or audited financial statement;
620     2.  A report of cash receipts and expenditures or a
621compiled financial statement in lieu of a reviewed or audited
622financial statement; or
623     3.  A report of cash receipts and expenditures, a compiled
624financial statement, or a reviewed financial statement in lieu
625of an audited financial statement.
626     Section 10.  Subsection (2) of section 720.303, Florida
627Statutes, as amended by section 2 of chapter 2004-345 and
628section 15 of chapter 2004-353, Laws of Florida, is repealed.
629     Section 11.  Section 720.3035, Florida Statutes, is created
630to read:
631     720.3035  Architectural control covenants; parcel owner
632improvements; rights and privileges.--
633     (1)  The authority of an association or any architectural,
634construction improvement, or other such similar committee of an
635association to review and approve plans and specifications for
636the location, size, type, or appearance of any structure or
637other improvement on a parcel, or to enforce standards for the
638external appearance of any structure or improvement located on a
639parcel, shall be permitted only to the extent that the authority
640is specifically stated or reasonably inferred as to such
641location, size, type, or appearance in the declaration of
642covenants or other published guidelines and standards authorized
643by the declaration of covenants.
644     (2)  If the declaration of covenants or other published
645guidelines and standards authorized by the declaration of
646covenants provide options for the use of material, the size of
647the structure or improvement, the design of the structure or
648improvement, or the location of the structure or improvement on
649the parcel, neither the association nor any architectural,
650construction improvement, or other such similar committee of the
651association shall restrict the right of a parcel owner to select
652from the options provided in the declaration of covenants or
653other published guidelines and standards authorized by the
654declaration of covenants.
655     (3)  Unless otherwise specifically stated in the
656declaration of covenants or other published guidelines and
657standards authorized by the declaration of covenants, each
658parcel shall be deemed to have only one front for purposes of
659determining the required front setback even if the parcel is
660bounded by a roadway or other easement on more than one side.
661When the declaration of covenants or other published guidelines
662and standards authorized by the declaration of covenants do not
663provide for specific setback limitations, the applicable county
664or municipal setback limitations shall apply, and neither the
665association nor any architectural, construction improvement, or
666other such similar committee of the association shall enforce or
667attempt to enforce any setback limitation that is inconsistent
668with the applicable county or municipal standard or standards.
669     (4)  Each parcel owner shall be entitled to the rights and
670privileges set forth in the declaration of covenants or other
671published guidelines and standards authorized by the declaration
672of covenants concerning the architectural use of the parcel, and
673the construction of permitted structures and improvements on the
674parcel and such rights and privileges shall not be unreasonably
675infringed upon or impaired by the association or any
676architectural, construction improvement, or other such similar
677committee of the association. If the association or any
678architectural, construction improvement, or other such similar
679committee of the association should unreasonably, knowingly, and
680willfully infringe upon or impair the rights and privileges set
681forth in the declaration of covenants or other published
682guidelines and standards authorized by the declaration of
683covenants, the adversely affected parcel owner shall be entitled
684to recover damages caused by such infringement or impairment,
685including any costs and reasonable attorney's fees incurred in
686preserving or restoring the rights and privileges of the parcel
687owner set forth in the declaration of covenants or other
688published guidelines and standards authorized by the declaration
689of covenants.
690     (5)  Neither the association nor any architectural,
691construction improvement, or other such similar committee of the
692association shall enforce any policy or restriction that is
693inconsistent with the rights and privileges of a parcel owner
694set forth in the declaration of covenants or other published
695guidelines and standards authorized by the declaration of
696covenants, whether uniformly applied or not. Neither the
697association nor any architectural, construction improvement, or
698other such similar committee of the association may rely upon a
699policy or restriction that is inconsistent with the declaration
700of covenants or other published guidelines and standards
701authorized by the declaration of covenants, whether uniformly
702applied or not, in defense of any action taken in the name of or
703on behalf of the association against a parcel owner.
704     Section 12.  Subsection (1) of section 720.305, Florida
705Statutes, is amended to read:
706     720.305  Obligations of members; remedies at law or in
707equity; levy of fines and suspension of use rights; failure to
708fill sufficient number of vacancies on board of directors to
709constitute a quorum; appointment of receiver upon petition of
710any member.--
711     (1)  Each member and the member's tenants, guests, and
712invitees, and each association, are governed by, and must comply
713with, this chapter, the governing documents of the community,
714and the rules of the association. Actions at law or in equity,
715or both, to redress alleged failure or refusal to comply with
716these provisions may be brought by the association or by any
717member against:
718     (a)  The association;
719     (b)  A member;
720     (c)  Any director or officer of an association who
721willfully and knowingly fails to comply with these provisions;
723     (d)  Any tenants, guests, or invitees occupying a parcel or
724using the common areas.
726The prevailing party in any such litigation is entitled to
727recover reasonable attorney's fees and costs. A member
728prevailing in an action between the association and the member
729under this section, in addition to recovering his or her
730reasonable attorney's fees, may recover additional amounts as
731determined by the court to be necessary to reimburse the member
732for his or her share of assessments levied by the association to
733fund its expenses of the litigation. This relief does not
734exclude other remedies provided by law. This section does not
735deprive any person of any other available right or remedy.
736     Section 13.  Paragraph (c) of subsection (1) of section
737720.306, Florida Statutes, is amended to read:
738     720.306  Meetings of members; voting and election
739procedures; amendments.--
740     (1)  QUORUM; AMENDMENTS.--
741     (c)  Unless otherwise provided in the governing documents
742as originally recorded or permitted by this chapter or chapter
743617, an amendment may not materially and adversely alter the
744proportionate voting interest appurtenant to a parcel or
745increase the proportion or percentage by which a parcel shares
746in the common expenses of the association unless the record
747parcel owner and all record owners of liens on the parcels join
748in the execution of the amendment. For purposes of this section,
749a change in quorum requirements is not an alteration of voting
750interests. The merger or consolidation of one or more
751associations under a plan of merger or consolidation under
752chapter 607 or chapter 617 shall not be considered a material or
753adverse alteration of the proportionate voting interest
754appurtenant to a parcel.
755     Section 14.  Paragraph (t) is added to subsection (3) of
756section 720.307, Florida Statutes, to read:
757     720.307  Transition of association control in a
758community.--With respect to homeowners' associations:
759     (3)  At the time the members are entitled to elect at least
760a majority of the board of directors of the homeowners'
761association, the developer shall, at the developer's expense,
762within no more than 90 days deliver the following documents to
763the board:
764     (t)  The financial records, including financial statements
765of the association, and source documents from the incorporation
766of the association through the date of turnover. The records
767shall be audited by an independent certified public accountant
768for the period from the incorporation of the association or from
769the period covered by the last audit if an audit has been
770performed for each fiscal year since incorporation. All
771financial statements shall be prepared in accordance with
772generally accepted accounting principles and shall be audited in
773accordance with generally accepted auditing standards, as
774prescribed by the Board of Accountancy, pursuant to chapter 473.
775The certified public accountant performing the audit shall
776examine to the extent necessary supporting documents and
777records, including the cash disbursements and related paid
778invoices, to determine whether expenditures were for association
779purposes and the billings, cash receipts, and related records of
780the association to determine whether the developer was charged
781and paid the proper amounts of assessments. This paragraph
782applies to associations with a date of incorporation after
783December 31, 2007.
784     Section 15.  Section 720.308, Florida Statutes, is amended
785to read:
786     720.308  Assessments and charges.--
787     (1)  ASSESSMENTS.--For any community created after October
7881, 1995, the governing documents must describe the manner in
789which expenses are shared and specify the member's proportional
790share thereof. Assessments levied pursuant to the annual budget
791or special assessment must be in the member's proportional share
792of expenses as described in the governing document, which share
793may be different among classes of parcels based upon the state
794of development thereof, levels of services received by the
795applicable members, or other relevant factors. While the
796developer is in control of the homeowners' association, it may
797be excused from payment of its share of the operating expenses
798and assessments related to its parcels for any period of time
799for which the developer has, in the declaration, obligated
800itself to pay any operating expenses incurred that exceed the
801assessments receivable from other members and other income of
802the association. This section does not apply to an association,
803no matter when created, if the association is created in a
804community that is included in an effective development-of-
805regional-impact development order as of the effective date of
806this act, together with any approved modifications thereto.
808     (a)  Establishment of a guarantee.--If a guarantee of the
809assessments of parcel owners is not included in the purchase
810contracts or declaration, any agreement establishing a guarantee
811shall only be effective upon the approval of a majority of the
812voting interests of the members other than the developer.
813Approval shall be expressed at a meeting of the members voting
814in person or by limited proxy or by agreement in writing without
815a meeting if provided in the bylaws. Such guarantee must meet
816the requirements of this section.
817     (b)  Guarantee period.--The period of time for the
818guarantee shall be indicated by a specific beginning and ending
819date or event.
820     1.  The ending date or event shall be the same for all of
821the members of an association, including members in different
822phases of the development.
823     2.  The guarantee may provide for different intervals of
824time during a guarantee period with a different dollar amount
825for each such interval.
826     3.  The guarantee may provide that after the initial stated
827period, the developer has an option to extend the guarantee for
828one or more additional stated periods. The extension of a
829guarantee is limited to extending the ending date or event;
830therefore, the developer does not have the option of changing
831the level of assessments guaranteed.
832     (3)  MAXIMUM LEVEL OF ASSESSMENTS.--The stated dollar
833amount of the guarantee shall be an exact dollar amount for each
834parcel identified in the declaration. Regardless of the stated
835dollar amount of the guarantee, assessments charged to a member
836shall not exceed the maximum obligation of the member based on
837the total amount of the adopted budget and the member's
838proportionate share of the expenses as described in the
839governing documents.
841payments required from the guarantor during the guarantee period
842shall be determined as follows:
843     (a)  If at any time during the guarantee period the funds
844collected from member assessments at the guaranteed level and
845other revenues collected by the association are not sufficient
846to provide payment, on a timely basis, of all assessments,
847including the full funding of the reserves unless properly
848waived, the guarantor shall advance sufficient cash to the
849association at the time such payments are due.
850     (b)  Expenses incurred in the production of nonassessment
851revenues, not in excess of the nonassessment revenues, shall not
852be included in the assessments. If the expenses attributable to
853nonassessment revenues exceed nonassessment revenues, only the
854excess expenses must be funded by the guarantor. Interest earned
855on the investment of association funds may be used to pay the
856income tax expense incurred as a result of the investment, such
857expense shall not be charged to the guarantor, and the net
858investment income shall be retained by the association. Each
859such nonassessment-revenue-generating activity shall be
860considered separately. Any portion of the parcel assessment that
861is budgeted for designated capital contributions of the
862association shall not be used to pay operating expenses.
864guarantor's total financial obligation to the association at the
865end of the guarantee period shall be determined on the accrual
866basis using the following formula: the guarantor shall pay any
867deficits that exceed the guaranteed amount, less the total
868regular periodic assessments earned by the association from the
869members other than the guarantor during the guarantee period
870regardless of whether the actual level charged was less than the
871maximum guaranteed amount.
872     (6)  EXPENSES.--Expenses incurred in the production of
873nonassessment revenues, not in excess of the nonassessment
874revenues, shall not be included in the operating expenses. If
875the expenses attributable to nonassessment revenues exceed
876nonassessment revenues, only the excess expenses must be funded
877by the guarantor. Interest earned on the investment of
878association funds may be used to pay the income tax expense
879incurred as a result of the investment, such expense shall not
880be charged to the guarantor, and the net investment income shall
881be retained by the association. Each such nonassessment-revenue-
882generating activity shall be considered separately. Any portion
883of the parcel assessment that is budgeted for designated capital
884contributions of the association shall not be used to pay
885operating expenses.
886     Section 16.  Section 720.311, Florida Statutes, is amended
887to read:
888     720.311  Dispute resolution.--
889     (1)  The Legislature finds that alternative dispute
890resolution has made progress in reducing court dockets and
891trials and in offering a more efficient, cost-effective option
892to litigation. The filing of any petition for mediation or
893arbitration or the serving of a demand for presuit mediation as
894provided for in this section shall toll the applicable statute
895of limitations. Any recall dispute filed with the department
896pursuant to s. 720.303(10) shall be conducted by the department
897in accordance with the provisions of ss. 718.112(2)(j) and
898718.1255 and the rules adopted by the division. In addition, the
899department shall conduct mandatory binding arbitration of
900election disputes between a member and an association pursuant
901to s. 718.1255 and rules adopted by the division. Neither
902election disputes nor recall disputes are eligible for presuit
903mediation; these disputes shall be arbitrated by the department.
904At the conclusion of the proceeding, the department shall charge
905the parties a fee in an amount adequate to cover all costs and
906expenses incurred by the department in conducting the
907proceeding. Initially, the petitioner shall remit a filing fee
908of at least $200 to the department. The fees paid to the
909department shall become a recoverable cost in the arbitration
910proceeding, and the prevailing party in an arbitration
911proceeding shall recover its reasonable costs and attorney's
912fees in an amount found reasonable by the arbitrator. The
913department shall adopt rules to effectuate the purposes of this
915     (2)(a)  Disputes between an association and a parcel owner
916regarding use of or changes to the parcel or the common areas
917and other covenant enforcement disputes, disputes regarding
918amendments to the association documents, disputes regarding
919meetings of the board and committees appointed by the board,
920membership meetings not including election meetings, and access
921to the official records of the association shall be the subject
922of a demand filed with the department for presuit mandatory
923mediation served by an aggrieved party before the dispute is
924filed in court. Presuit mediation proceedings must be conducted
925in accordance with the applicable Florida Rules of Civil
926Procedure, and these proceedings are privileged and confidential
927to the same extent as court-ordered mediation. Disputes subject
928to presuit mediation under this section shall not include the
929collection of any assessment, fine, or other financial
930obligation, including attorney's fees and costs, claimed to be
931due or any action to enforce a prior mediation settlement
932agreement between the parties. Also, in any dispute subject to
933presuit mediation under this section where emergency relief is
934required, a motion for temporary injunctive relief may be filed
935with the court without first complying with the presuit
936mediation requirements of this section. After any issues
937regarding emergency or temporary relief are resolved, the court
938may either refer the parties to a mediation program administered
939by the courts or require mediation under this section. An
940arbitrator or judge may not consider any information or evidence
941arising from the presuit mediation proceeding except in a
942proceeding to impose sanctions for failure to attend a presuit
943mediation session or to enforce a mediated settlement agreement.
944Persons who are not parties to the dispute may not attend the
945presuit mediation conference without the consent of all parties,
946except for counsel for the parties and a corporate
947representative designated by the association. When mediation is
948attended by a quorum of the board, such mediation is not a board
949meeting for purposes of notice and participation set forth in s.
950720.303. An aggrieved party shall serve on the responding party
951a written demand to participate in presuit mediation in
952substantially the following form:
956The alleged aggrieved party,__________________, hereby demands
957that_________________, as the responding party, engage in
958mandatory presuit mediation in connection with the following
959disputes, which by statute are of a type that are subject to
960presuit mediation:
962(List specific nature of the dispute or disputes to be mediated
963and the authority supporting a finding of a violation as to each
966Pursuant to section 720.311, Florida Statutes, this demand to
967resolve the dispute through presuit mediation is required before
968a lawsuit can be filed concerning the dispute. Pursuant to the
969statute, the parties are required to engage in presuit mediation
970with a neutral third-party mediator in order to attempt to
971resolve this dispute without court action, and the aggrieved
972party demands that you likewise agree to this process. If you
973fail to participate in the mediation process, suit may be
974brought against you without further warning.
976The process of mediation involves a supervised negotiation
977process in which a trained, neutral third-party mediator meets
978with both parties and assists them in exploring possible
979opportunities for resolving part or all of the dispute. By
980agreeing to participate in presuit mediation, you are not bound
981in any way to change your position. Furthermore, the mediator
982has no authority to make any decisions in this matter or to
983determine who is right or wrong and merely acts as a facilitator
984to ensure that each party understands the position of the other
985party and that all options for reasonable settlement are fully
988If an agreement is reached, it shall be reduced to writing and
989becomes a binding and enforceable commitment of the parties. A
990resolution of one or more disputes in this fashion avoids the
991need to litigate these issues in court. The failure to reach an
992agreement, or the failure of a party to participate in the
993process, results in the mediator declaring an impasse in the
994mediation, after which the aggrieved party may proceed to court
995on all outstanding, unsettled disputes. If you have failed or
996refused to participate in the entire mediation process, you will
997not be entitled to recover attorney's fees, even if you prevail.
999The aggrieved party has selected and hereby lists five certified
1000mediators who we believe to be neutral and qualified to mediate
1001the dispute. You have the right to select any one of these
1002mediators. The fact that one party may be familiar with one or
1003more of the listed mediators does not mean that the mediator
1004cannot act as a neutral and impartial facilitator. Any mediator
1005who cannot act in this capacity is required ethically to decline
1006to accept engagement. The mediators whom we suggest, and their
1007current hourly rates, are as follows:
1009(List the names, addresses, telephone numbers, and hourly rates
1010of the mediators. Other pertinent information about the
1011background of the mediators may be included as an attachment.)
1013You may contact the offices of these mediators to confirm that
1014the listed mediators will be neutral and will not show any
1015favoritism toward either party. The Florida Supreme Court can
1016provide you a list of certified mediators.
1018Unless otherwise agreed by the parties, section 720.311(2)(b),
1019Florida Statutes, requires that the parties share the costs of
1020presuit mediation equally, including the fee charged by the
1021mediator. An average mediation may require three to four hours
1022of the mediator's time, including some preparation time, and the
1023parties would need to share equally the mediator's fees as well
1024as their own attorney's fees if they choose to employ an
1025attorney in connection with the mediation. However, use of an
1026attorney is not required and is at the option of each party. The
1027mediators may require the advance payment of some or all of the
1028anticipated fees. The aggrieved party hereby agrees to pay or
1029prepay one-half of the mediator's estimated fees and to forward
1030this amount or such other reasonable advance deposits as the
1031mediator requires for this purpose. Any funds deposited will be
1032returned to you if these are in excess of your share of the fees
1035To begin your participation in presuit mediation to try to
1036resolve the dispute and avoid further legal action, please sign
1037below and clearly indicate which mediator is acceptable to you.
1038We will then ask the mediator to schedule a mutually convenient
1039time and place for the mediation conference to be held. The
1040mediation conference must be held within ninety (90) days of
1041this date, unless extended by mutual written agreement. In the
1042event that you fail to respond within 20 days from the date of
1043this letter, or if you fail to agree to at least one of the
1044mediators that we have suggested or to pay or prepay to the
1045mediator one-half of the costs involved, the aggrieved party
1046will be authorized to proceed with the filing of a lawsuit
1047against you without further notice and may seek an award of
1048attorney's fees or costs incurred in attempting to obtain
1051Therefore, please give this matter your immediate attention. By
1052law, your response must be mailed by certified mail, return
1053receipt requested, and by first-class mail to the address shown
1054on this demand.
1063The undersigned hereby agrees to participate in presuit
1064mediation and agrees to attend a mediation conducted by the
1065following mediator or mediators who are listed above as someone
1066who would be acceptable to mediate this dispute:
1068(List acceptable mediator or mediators.)
1070I/we further agree to pay or prepay one-half of the mediator's
1071fees and to forward such advance deposits as the mediator may
1072require for this purpose.
1075Signature of responding party #1
1079Telephone contact information
1082Signature and telephone contact information of responding party
1083#2 (if applicable)(if property is owned by more than one person,
1084all owners must sign)
1086     (b)  Service of the statutory demand to participate in
1087presuit mediation shall be effected by sending a letter in
1088substantial conformity with the above form by certified mail,
1089return receipt requested, with an additional copy being sent by
1090regular first-class mail, to the address of the responding party
1091as it last appears on the books and records of the association.
1092The responding party has 20 days from the date of the mailing of
1093the statutory demand to serve a response to the aggrieved party
1094in writing. The response shall be served by certified mail,
1095return receipt requested, with an additional copy being sent by
1096regular first-class mail, to the address shown on the statutory
1097demand. Notwithstanding the foregoing, once the parties have
1098agreed on a mediator, the mediator may reschedule the mediation
1099for a date and time mutually convenient to the parties. The
1100department shall conduct the proceedings through the use of
1101department mediators or refer the disputes to private mediators
1102who have been duly certified by the department as provided in
1103paragraph (c). The parties shall share the costs of presuit
1104mediation equally, including the fee charged by the mediator, if
1105any, unless the parties agree otherwise, and the mediator may
1106require advance payment of his or her reasonable fees and costs.
1107The failure of any party to respond to a demand or response, to
1108agree upon a mediator, to make payment of fees and costs within
1109the time established by the mediator, or to appear for a
1110scheduled mediation session without the approval of the
1111mediator, shall constitute the failure or refusal to participate
1112in the mediation process and shall operate as an impasse in the
1113presuit mediation by such party, entitling the other party to
1114proceed in court and to seek an award of the costs and fees
1115associated with the mediation. Additionally, notwithstanding the
1116provisions of any other law or document, persons who fail or
1117refuse to participate in the entire mediation process may not
1118recover attorney's fees and costs in subsequent litigation
1119relating to the dispute. If any presuit mediation session cannot
1120be scheduled and conducted within 90 days after the offer to
1121participate in mediation was filed, an impasse shall be deemed
1122to have occurred unless both parties agree to extend this
1123deadline. If a department mediator is used, the department may
1124charge such fee as is necessary to pay expenses of the
1125mediation, including, but not limited to, the salary and
1126benefits of the mediator and any travel expenses incurred. The
1127petitioner shall initially file with the department upon filing
1128the disputes, a filing fee of $200, which shall be used to
1129defray the costs of the mediation. At the conclusion of the
1130mediation, the department shall charge to the parties, to be
1131shared equally unless otherwise agreed by the parties, such
1132further fees as are necessary to fully reimburse the department
1133for all expenses incurred in the mediation.
1134     (c)(b)  If presuit mediation as described in paragraph (a)
1135is not successful in resolving all issues between the parties,
1136the parties may file the unresolved dispute in a court of
1137competent jurisdiction or elect to enter into binding or
1138nonbinding arbitration pursuant to the procedures set forth in
1139s. 718.1255 and rules adopted by the division, with the
1140arbitration proceeding to be conducted by a department
1141arbitrator or by a private arbitrator certified by the
1142department. If all parties do not agree to arbitration
1143proceedings following an unsuccessful presuit mediation, any
1144party may file the dispute in court. A final order resulting
1145from nonbinding arbitration is final and enforceable in the
1146courts if a complaint for trial de novo is not filed in a court
1147of competent jurisdiction within 30 days after entry of the
1148order. As to any issue or dispute that is not resolved at
1149presuit mediation, and as to any issue that is settled at
1150presuit mediation but is thereafter subject to an action seeking
1151enforcement of the mediation settlement, the prevailing party in
1152any subsequent arbitration or litigation proceeding shall be
1153entitled to seek recovery of all costs and attorney's fees
1154incurred in the presuit mediation process.
1155     (d)(c)  The department shall develop a certification and
1156training program for private mediators and private arbitrators
1157which shall emphasize experience and expertise in the area of
1158the operation of community associations. A mediator or
1159arbitrator shall be authorized to conduct mediation or
1160arbitration under this section certified by the department only
1161if he or she has been certified as a circuit court civil
1162mediator or arbitrator, respectively, pursuant to the
1163requirements established attended at least 20 hours of training
1164in mediation or arbitration, as appropriate, and only if the
1165applicant has mediated or arbitrated at least 10 disputes
1166involving community associations within 5 years prior to the
1167date of the application, or has mediated or arbitrated 10
1168disputes in any area within 5 years prior to the date of
1169application and has completed 20 hours of training in community
1170association disputes. In order to be certified by the
1171department, any mediator must also be certified by the Florida
1172Supreme Court. Settlement agreements resulting from mediation
1173shall not have precedential value in proceedings involving
1174parties other than those participating in the mediation to
1175support either a claim or defense in other disputes. The
1176department may conduct the training and certification program
1177within the department or may contract with an outside vendor to
1178perform the training or certification. The expenses of operating
1179the training and certification and training program shall be
1180paid by the moneys and filing fees generated by the arbitration
1181of recall and election disputes and by the mediation of those
1182disputes referred to in this subsection and by the training
1184     (e)(d)  The presuit mediation procedures provided by this
1185subsection may be used by a Florida corporation responsible for
1186the operation of a community in which the voting members are
1187parcel owners or their representatives, in which membership in
1188the corporation is not a mandatory condition of parcel
1189ownership, or which is not authorized to impose an assessment
1190that may become a lien on the parcel.
1191     (3)  The department shall develop an education program to
1192assist homeowners, associations, board members, and managers in
1193understanding and increasing awareness of the operation of
1194homeowners' associations pursuant to this chapter and in
1195understanding the use of alternative dispute resolution
1196techniques in resolving disputes between parcel owners and
1197associations or between owners. Such education program may
1198include the development of pamphlets and other written
1199instructional guides, the holding of classes and meetings by
1200department employees or outside vendors, as the department
1201determines, and the creation and maintenance of a website
1202containing instructional materials. The expenses of operating
1203the education program shall be initially paid by the moneys and
1204filing fees generated by the arbitration of recall and election
1205disputes and by the mediation of those disputes referred to in
1206this subsection.
1207     Section 17.  Except as otherwise expressly provided in this
1208act, this act shall take effect July 1, 2007.

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