CS/HB 433

1	A bill to be entitled
2	An act relating to community associations; creating s.
3	712.11, F.S.; providing for the revival of certain
4	covenants that have lapsed; amending s. 718.106, F.S.;
5	prohibiting local governments from limiting the access of
6	certain persons to beaches adjacent to or adjoining
7	condominium property; amending s. 718.110, F.S.; revising
8	provisions relating to the amendment of declarations;
9	providing legislative findings and a finding of compelling
10	state interest; providing criteria for consent to an
11	amendment; requiring notice regarding proposed amendments
12	to mortgagees; providing criteria for notification;
13	providing for voiding certain amendments; amending s.
14	718.114, F.S.; providing that certain agreements to
15	acquire leaseholds, memberships, or other possessory or
16	use interests shall be considered a material alteration or
17	substantial addition to certain real property; amending s.
18	718.404, F.S.; providing retroactive application of
19	provisions relating to mixed-use condominiums; amending s.
20	719.103, F.S.; providing a definition; amending s.
21	719.507, F.S.; prohibiting laws, ordinances, or
22	regulations that apply only to improvements that are or
23	may be subjected to an equity club form of ownership;
24	amending s. 720.302, F.S.; revising governing provisions
25	relating to corporations that operate residential
26	homeowners' associations; amending s. 720.303, F.S.;
27	revising application to include certain meetings;
28	requiring the association to provide certain information
29	to prospective purchasers or lienholders; authorizing the
30	association to charge a reasonable fee for providing
31	certain information; requiring the budget to provide for
32	annual operating expenses; authorizing the budget to
33	include reserve accounts for capital expenditures and
34	deferred maintenance; providing a formula for calculating
35	the amount to be reserved; authorizing the association to
36	adjust replacement reserve assessments annually;
37	authorizing the developer to vote to waive the reserves or
38	reduce the funding of reserves for a certain period;
39	revising provisions relating to financial reporting;
40	revising time periods in which the association must
41	complete its reporting; requiring financial statements to
42	be prepared in accordance with generally accepted
43	accounting principles as adopted by the Board of
44	Accountancy; repealing s. 720.303(2), F.S., as amended,
45	relating to board meetings, to remove conflicting versions
46	of that subsection; creating s. 720.3035, F.S.; providing
47	for architectural control covenants and parcel owner
48	improvements; authorizing the review and approval of plans
49	and specifications; providing limitations; providing
50	rights and privileges for parcel owners as set forth in
51	the declaration of covenants; amending s. 720.305, F.S.;
52	providing that, where a member is entitled to collect
53	attorney's fees against the association, the member may
54	also recover additional amounts as determined by the
55	court; amending s. 720.306, F.S.; providing that certain
56	mergers or consolidations of an association shall not be
57	considered a material or adverse alteration of the
58	proportionate voting interest appurtenant to a parcel;
59	amending s. 720.307, F.S.; requiring developers to deliver
60	financial records to the board in any transition of
61	association control to members; requiring certain
62	information to be included in the records and for the
63	records to be prepared in a specified manner; providing
64	application; amending s. 720.308, F.S.; providing
65	circumstances under which a guarantee of common expenses
66	shall be effective; providing for approval of the
67	guarantee by association members; providing for a
68	guarantee period and extension thereof; requiring the
69	stated dollar amount of the guarantee to be an exact
70	dollar amount for each parcel identified in the
71	declaration; providing payments required from the
72	guarantor to be determined in a certain manner; providing
73	a formula to determine the guarantor's total financial
74	obligation to the association; providing that certain
75	expenses incurred in the production of certain revenues
76	shall not be included in the operating expenses; amending
77	s. 720.311, F.S.; revising provisions relating to dispute
78	resolution; providing that the filing of any petition for
79	arbitration or the serving of an offer for presuit
80	mediation shall toll the applicable statute of
81	limitations; providing that certain disputes between an
82	association and a parcel owner shall be subject to presuit
83	mediation; revising provisions to conform; providing that
84	temporary injunctive relief may be sought in certain
85	disputes subject to presuit mediation; authorizing the
86	court to refer the parties to mediation under certain
87	circumstances; requiring the aggrieved party to serve on
88	the responding party a written offer to participate in
89	presuit mediation; providing a form for such offer;
90	providing that service of the offer is effected by the
91	sending of such an offer in a certain manner; providing
92	that the prevailing party in any subsequent arbitration or
93	litigation proceedings is entitled to seek recovery of all
94	costs and attorney's fees incurred in the presuit
95	mediation process; requiring the mediator or arbitrator to
96	meet certain certification requirements; removing a
97	requirement relating to development of an education
98	program to increase awareness of the operation of
99	homeowners' associations and the use of alternative
100	dispute resolution techniques; providing effective dates.
101
102	Be It Enacted by the Legislature of the State of Florida:
103
104	Section 1.  Section 712.11, Florida Statutes, is created to
105	read:
106	712.11  Covenant revitalization.--A homeowners' association
107	not otherwise subject to chapter 720 may use the procedures set
108	forth in ss. 720.403-720.407 to revive covenants that have
109	lapsed under the terms of this chapter.
110	Section 2.  Subsection (5) is added to section 718.106,
111	Florida Statutes, to read:
112	718.106  Condominium parcels; appurtenances; possession and
113	enjoyment.--
114	(5)  A local government may not adopt an ordinance or
115	regulation that prohibits condominium unit owners or their
116	guests, licensees, or invitees from pedestrian access to a
117	public beach contiguous to a condominium property, except where
118	necessary to protect public health, safety, or natural
119	resources. Nothing in this subsection shall prohibit a
120	governmental entity from enacting regulations governing
121	activities taking place on the beach.
122	Section 3.  Effective October 1, 2007, subsection (11) of
123	section 718.110, Florida Statutes, is amended to read:
124	718.110  Amendment of declaration; correction of error or
125	omission in declaration by circuit court.--
126	(11)  The Legislature finds that the procurement of
127	mortgagee consent to amendments that do not affect the rights or
128	interests of mortgagees is an unreasonable and substantial
129	logistical and financial burden on the unit owners and that
130	there is a compelling state interest in enabling the members of
131	a condominium association to approve amendments to the
132	condominium documents through legal means. Accordingly, and
133	notwithstanding any provision to the contrary contained in this
134	section:
135	(a)  As to any mortgage recorded on or after October 1,
136	2007, any provision in the declaration, articles of
137	incorporation, or bylaws that requires recorded after April 1,
138	1992, may not require the consent or joinder of some or all
139	mortgagees of units or any other portion of the condominium
140	property to or in amendments to the declaration, articles of
141	incorporation, or bylaws or for any other matter shall be
142	enforceable only as to the following matters: unless the
143	requirement is limited to amendments materially affecting the
144	rights or interests of the mortgagees, or as otherwise required
145	by the Federal National Mortgage Association or the Federal Home
146	Loan Mortgage Corporation, and unless the requirement provides
147	that such consent may not be unreasonably withheld. It shall be
148	presumed that, except as to
149	1.  Those matters described in subsections (4) and (8).,
150	2.  Amendments to the declaration, articles of
151	incorporation, or bylaws that adversely affect the priority of
152	the mortgagee's lien or the mortgagee's rights to foreclose its
153	lien or that otherwise materially affect the rights and
154	interests of the mortgagees.
155	(b)  As to mortgages recorded before October 1, 2007, any
156	existing provision in the declaration, articles of
157	incorporation, or bylaws requiring mortgagee consent shall be
158	enforceable.
159	(c)  In securing consent or joinder, the association shall
160	be entitled to rely upon public records to identify the holders
161	of outstanding mortgages. The association may use the address
162	provided in the original recorded mortgage document, unless
163	there is a different address for the holder of the mortgage in a
164	recorded assignment or modification of the mortgage, which
165	recorded assignment or modification must reference the official
166	records book and page on which the original mortgage was
167	recorded. Once the association has identified the recorded
168	mortgages of record, the association shall, in writing, request
169	of each unit owner whose unit is encumbered by a mortgage of
170	record any information the owner has in his or her possession
171	regarding the name and address of the person to whom mortgage
172	payments are currently being made. Notice shall be sent to such
173	person if the name and address provided in the original recorded
174	mortgage document is different from the name and address of the
175	mortgagee or assignee of the mortgage as shown by the public
176	record. The association shall be deemed to have complied with
177	this requirement by making the written request of the unit
178	owners required under this paragraph. Any notice required to be
179	sent to the mortgagees under this paragraph shall be sent to all
180	available 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,
183	and any mortgagee who fails to respond within 60 days after the
184	date of mailing shall be deemed to have consented to the
185	amendment.
186	(e)  For those amendments requiring mortgagee consent on or
187	after October 1, 2007, do not materially affect the rights or
188	interests of mortgagees. in the event mortgagee consent is
189	provided other than by properly recorded joinder, such consent
190	shall be evidenced by affidavit of the association recorded in
191	the public records of the county where the declaration is
192	recorded. Any amendment adopted without the required consent of
193	a mortgagee shall be voidable only by a mortgagee who was
194	entitled to notice and an opportunity to consent. An action to
195	void an amendment shall be subject to the statute of limitations
196	beginning 5 years after the date of discovery as to the
197	amendments described in subparagraphs (a)1. and 2. and 5 years
198	after the date of recordation of the certificate of amendment
199	for all other amendments. This provision shall apply to all
200	mortgages, regardless of the date of recordation of the
201	mortgage.
202	(f)  Notwithstanding the provisions of this section, any
203	amendment or amendments to conform a declaration of condominium
204	to the insurance coverage provisions in s. 718.111(11) may be
205	made as provided in that section.
206	Section 4.  Section 718.114, Florida Statutes, is amended
207	to read:
208	718.114  Association powers.--An association has the power
209	to enter into agreements, to acquire leaseholds, memberships,
210	and other possessory or use interests in lands or facilities
211	such as country clubs, golf courses, marinas, and other
212	recreational facilities. It has this power whether or not the
213	lands or facilities are contiguous to the lands of the
214	condominium, if they are intended to provide enjoyment,
215	recreation, or other use or benefit to the unit owners. All of
216	these leaseholds, memberships, and other possessory or use
217	interests existing or created at the time of recording the
218	declaration must be stated and fully described in the
219	declaration. Subsequent to the recording of the declaration,
220	agreements to acquire these leaseholds, memberships, or other
221	possessory or use interests not entered into within 12 months
222	following the recording of the declaration shall be considered a
223	material alteration or substantial addition to the real property
224	that is association property, and the association may not
225	acquire or enter into agreements acquiring these leaseholds,
226	memberships, or other possessory or use interests except as
227	authorized by the declaration as provided in s. 718.113. The
228	declaration may provide that the rental, membership fees,
229	operations, replacements, and other expenses are common expenses
230	and may impose covenants and restrictions concerning their use
231	and may contain other provisions not inconsistent with this
232	chapter. A condominium association may conduct bingo games as
233	provided in s. 849.0931.
234	Section 5.  Subsections (1) and (2) of section 718.404,
235	Florida Statutes, are amended to read:
236	718.404  Mixed-use condominiums.--When a condominium
237	consists of both residential and commercial units, the following
238	provisions shall apply:
239	(1)  The condominium documents shall not provide that the
240	owner of any commercial unit shall have the authority to veto
241	amendments to the declaration, articles of incorporation,
242	bylaws, or rules or regulations of the association. This
243	subsection shall apply retroactively as a remedial measure.
244	(2)  Subject to s. 718.301, where the number of residential
245	units in the condominium equals or exceeds 50 percent of the
246	total units operated by the association, owners of the
247	residential units shall be entitled to vote for a majority of
248	the seats on the board of administration. This subsection shall
249	apply retroactively as a remedial measure.
250	Section 6.  Subsections (18) through (27) of section
251	719.103, Florida Statutes, are renumbered as subsections (19)
252	through (28), respectively, and a new subsection (18) is added
253	to that section to read:
254	719.103  Definitions.--As used in this chapter:
255	(18)  "Equity facilities club" means a club comprised of
256	recreational facilities in which proprietary membership
257	interests are sold to individuals, which membership interests
258	entitle the individuals to use certain physical facilities owned
259	by the equity club. Such physical facilities do not include a
260	residential unit or accommodation. For purposes of this
261	definition, the term "accommodation" shall include, but is not
262	limited to, any apartment, residential cooperative unit,
263	residential condominium unit, cabin, lodge, hotel or motel room,
264	or other accommodation designed for overnight occupancy for one
265	or more individuals.
266	Section 7.  Section 719.507, Florida Statutes, is amended
267	to read:
268	719.507  Zoning and building laws, ordinances, and
269	regulations.--All laws, ordinances, and regulations concerning
270	buildings or zoning shall be construed and applied with
271	reference to the nature and use of such property, without regard
272	to the form of ownership. No law, ordinance, or regulation shall
273	establish any requirement concerning the use, location,
274	placement, or construction of buildings or other improvements
275	which are, or may thereafter be, subjected to the cooperative or
276	equity facilities club form of ownership, unless such
277	requirement shall be equally applicable to all buildings and
278	improvements of the same kind not then, or thereafter to be,
279	subjected to the cooperative or equity facilities club form of
280	ownership. This section does not apply if the owner in fee of
281	any land enters into and records a covenant that existing
282	improvements or improvements to be constructed shall not be
283	converted to the cooperative form of residential ownership prior
284	to 5 years after the later of the date of the covenant or
285	completion date of the improvements. Such covenant shall be
286	entered into with the governing body of the municipality in
287	which the land is located or, if the land is not located in a
288	municipality, with the governing body of the county in which the
289	land is located.
290	Section 8.  Subsections (4) and (5) of section 720.302,
291	Florida Statutes, are amended to read:
292	720.302  Purposes, scope, and application.--
293	(4)  This chapter does not apply to any association that is
294	subject to regulation under chapter 718, chapter 719, or chapter
295	721; or to any nonmandatory association formed under chapter
296	723, except to the extent that a provision of chapter 718,
297	chapter 719, or chapter 721 is expressly incorporated into this
298	chapter for the purpose of regulating homeowners' associations.
299	(5)  Unless expressly stated to the contrary, corporations
300	not for profit that operate residential homeowners' associations
301	in this state shall be governed by and subject to chapter 607,
302	if the association was incorporated under that chapter, or to
303	chapter 617, if the association was incorporated under that
304	chapter, and this chapter. This subsection is intended to
305	clarify existing law.
306	Section 9.  Subsections (2), (6), and (7) of section
307	720.303, Florida Statutes, are amended, and paragraph (d) is
308	added to subsection (5) of that section, to read:
309	720.303  Association powers and duties; meetings of board;
310	official records; budgets; financial reporting; association
311	funds; recalls.--
312	(2)  BOARD MEETINGS.--
313	(a)  A meeting of the board of directors of an association
314	occurs whenever a quorum of the board gathers to conduct
315	association business. All meetings of the board must be open to
316	all members except for meetings between the board and its
317	attorney with respect to proposed or pending litigation where
318	the contents of the discussion would otherwise be governed by
319	the attorney-client privilege. The provisions of this subsection
320	shall also apply to the meetings of any committee or other
321	similar body when a final decision will be made regarding the
322	expenditure of association funds and to meetings of any body
323	vested with the power to approve or disapprove architectural
324	decisions with respect to a specific parcel of residential
325	property owned by a member of the community.
326	(b)  Members have the right to attend all meetings of the
327	board and to speak on any matter placed on the agenda by
328	petition of the voting interests for at least 3 minutes. The
329	association may adopt written reasonable rules expanding the
330	right of members to speak and governing the frequency, duration,
331	and other manner of member statements, which rules must be
332	consistent with this paragraph and may include a sign-up sheet
333	for members wishing to speak. Notwithstanding any other law, the
334	requirement that board meetings and committee meetings be open
335	to the members is inapplicable to meetings between the board or
336	a committee and the association's attorney, with respect to
337	meetings of the board held for the purpose of discussing
338	personnel matters.
339	(c)  The bylaws shall provide for giving notice to parcel
340	owners and members of all board meetings and, if they do not do
341	so, shall be deemed to provide the following:
342	1.  Notices of all board meetings must be posted in a
343	conspicuous place in the community at least 48 hours in advance
344	of a meeting, except in an emergency.  In the alternative, if
345	notice is not posted in a conspicuous place in the community,
346	notice of each board meeting must be mailed or delivered to each
347	member at least 7 days before the meeting, except in an
348	emergency. Notwithstanding this general notice requirement, for
349	communities with more than 100 members, the bylaws may provide
350	for a reasonable alternative to posting or mailing of notice for
351	each board meeting, including publication of notice, provision
352	of a schedule of board meetings, or the conspicuous posting and
353	repeated broadcasting of the notice on a closed-circuit cable
354	television system serving the homeowners' association. However,
355	if broadcast notice is used in lieu of a notice posted
356	physically in the community, the notice must be broadcast at
357	least four times every broadcast hour of each day that a posted
358	notice is otherwise required. When broadcast notice is provided,
359	the notice and agenda must be broadcast in a manner and for a
360	sufficient continuous length of time so as to allow an average
361	reader to observe the notice and read and comprehend the entire
362	content of the notice and the agenda. The bylaws or amended
363	bylaws may provide for giving notice by electronic transmission
364	in a manner authorized by law for meetings of the board of
365	directors, committee meetings requiring notice under this
366	section, and annual and special meetings of the members;
367	however, a member must consent in writing to receiving notice by
368	electronic transmission.
369	2.  An assessment may not be levied at a board meeting
370	unless the notice of the meeting includes a statement that
371	assessments will be considered and the nature of the
372	assessments. Written notice of any meeting at which special
373	assessments will be considered or at which amendments to rules
374	regarding parcel use will be considered must be mailed,
375	delivered, or electronically transmitted to the members and
376	parcel owners and posted conspicuously on the property or
377	broadcast on closed-circuit cable television not less than 14
378	days before the meeting.
379	3.  Directors may not vote by proxy or by secret ballot at
380	board meetings, except that secret ballots may be used in the
381	election of officers. This subsection also applies to the
382	meetings of any committee or other similar body, when a final
383	decision will be made regarding the expenditure of association
384	funds, and to any body vested with the power to approve or
385	disapprove architectural decisions with respect to a specific
386	parcel of residential property owned by a member of the
387	community.
388	(d)  If 20 percent of the total voting interests petition
389	the board to address an item of business, the board shall at its
390	next regular board meeting or at a special meeting of the board,
391	but not later than 60 days after the receipt of the petition,
392	take the petitioned item up on an agenda. The board shall give
393	all members notice of the meeting at which the petitioned item
394	shall be addressed in accordance with the 14-day notice
395	requirement pursuant to subparagraph (c)2. Each member shall
396	have the right to speak for at least 3 minutes on each matter
397	placed on the agenda by petition, provided that the member signs
398	the sign-up sheet, if one is provided, or submits a written
399	request to speak prior to the meeting. Other than addressing the
400	petitioned item at the meeting, the board is not obligated to
401	take any other action requested by the petition.
402	(5)  INSPECTION AND COPYING OF RECORDS.--The official
403	records shall be maintained within the state and must be open to
404	inspection and available for photocopying by members or their
405	authorized agents at reasonable times and places within 10
406	business days after receipt of a written request for access.
407	This subsection may be complied with by having a copy of the
408	official records available for inspection or copying in the
409	community. If the association has a photocopy machine available
410	where the records are maintained, it must provide parcel owners
411	with copies on request during the inspection if the entire
412	request is limited to no more than 25 pages.
413	(d)  The association or its authorized agent is not
414	required to provide a prospective purchaser or lienholder with
415	information about the residential subdivision or the association
416	other than information or documents required by this chapter to
417	be made available or disclosed. The association or its
418	authorized agent may charge a reasonable fee to the prospective
419	purchaser or lienholder or the current parcel owner or member
420	for providing good faith responses to requests for information
421	by or on behalf of a prospective purchaser or lienholder, other
422	than that required by law, if the fee does not exceed $150 plus
423	the reasonable cost of photocopying and any attorney's fees
424	incurred by the association in connection with the response.
425	(6)  BUDGETS.--
426	(a)  The association shall prepare an annual budget that
427	sets out the annual operating expenses. The budget must reflect
428	the estimated revenues and expenses for that year and the
429	estimated surplus or deficit as of the end of the current year.
430	The budget must set out separately all fees or charges paid for
431	by the association for recreational amenities, whether owned by
432	the association, the developer, or another person. The
433	association shall provide each member with a copy of the annual
434	budget or a written notice that a copy of the budget is
435	available upon request at no charge to the member. The copy must
436	be provided to the member within the time limits set forth in
437	subsection (5).
438	(b)  In addition to annual operating expenses, the budget
439	may include reserve accounts for capital expenditures and
440	deferred maintenance for which the association is responsible to
441	the extent that the governing documents do not limit increases
442	in assessments, including reserves. If the budget of the
443	association includes reserve accounts, such reserves shall be
444	determined, maintained, and waived in the manner provided in
445	this subsection. Once an association provides for reserve
446	accounts in the budget, the association shall thereafter
447	determine, maintain, and waive reserves in compliance with this
448	subsection.
449	(c)  If the budget of the association does not provide for
450	reserve accounts governed by this subsection and the association
451	is responsible for the repair and maintenance of capital
452	improvements that may result in a special assessment if reserves
453	are not provided, each financial report for the preceding fiscal
454	year required by subsection (7) shall contain the following
455	statement in conspicuous type: THE BUDGET OF THE ASSOCIATION
456	DOES NOT PROVIDE FOR RESERVE ACCOUNTS FOR CAPITAL EXPENDITURES
457	AND DEFERRED MAINTENANCE THAT MAY RESULT IN SPECIAL ASSESSMENTS.
458	OWNERS MAY ELECT TO PROVIDE FOR RESERVE ACCOUNTS PURSUANT TO THE
459	PROVISIONS OF SECTION 720.303(6), FLORIDA STATUTES, UPON THE
460	APPROVAL OF NOT LESS THAN A MAJORITY OF THE TOTAL VOTING
461	INTERESTS OF THE ASSOCIATION.
462	(d)  An association shall be deemed to have provided for
463	reserve accounts when reserve accounts have been initially
464	established by the developer or when the membership of the
465	association affirmatively elects to provide for reserves. If
466	reserve accounts are not initially provided for by the
467	developer, the membership of the association may elect to do so
468	upon the affirmative approval of not less than a majority of the
469	total voting interests of the association. Such approval may be
470	attained by vote of the members at a duly called meeting of the
471	membership or upon a written consent executed by not less than a
472	majority of the total voting interests in the community. The
473	approval action of the membership shall state that reserve
474	accounts shall be provided for in the budget and designate the
475	components for which the reserve accounts are to be established.
476	Upon approval by the membership, the board of directors shall
477	provide for the required reserve accounts for inclusion in the
478	budget in the next fiscal year following the approval and in
479	each year thereafter. Once established as provided in this
480	subsection, the reserve accounts shall be funded or maintained
481	or shall have their funding waived in the manner provided in
482	paragraph (f).
483	(e)  The amount to be reserved in any account established
484	shall be computed by means of a formula that is based upon
485	estimated remaining useful life and estimated replacement cost
486	or deferred maintenance expense of each reserve item. The
487	association may adjust replacement reserve assessments annually
488	to take into account any changes in estimates of cost or useful
489	life of a reserve item.
490	(f)  Once a reserve account or reserve accounts are
491	established, the membership of the association, upon a majority
492	vote at a meeting at which a quorum is present, may provide for
493	no reserves or less reserves than required by this section. If a
494	meeting of the unit owners has been called to determine whether
495	to waive or reduce the funding of reserves and no such result is
496	achieved or a quorum is not present, the reserves as included in
497	the budget shall go into effect. After the turnover, the
498	developer may vote its voting interest to waive or reduce the
499	funding of reserves. Any vote taken pursuant to this subsection
500	to waive or reduce reserves shall be applicable only to one
501	budget year.
502	(g)  Funding formulas for reserves authorized by this
503	section shall be based on either a separate analysis of each of
504	the required assets or a pooled analysis of two or more of the
505	required assets.
506	1.  If the association maintains separate reserve accounts
507	for each of the required assets, the amount of the contribution
508	to each reserve account shall be the sum of the following two
509	calculations:
510	a.  The total amount necessary, if any, to bring a negative
511	component balance to zero.
512	b.  The total estimated deferred maintenance expense or
513	estimated replacement cost of the reserve component less the
514	estimated balance of the reserve component as of the beginning
515	of the period for which the budget will be in effect. The
516	remainder, if greater than zero, shall be divided by the
517	estimated remaining useful life of the component.
518
519	The formula may be adjusted each year for changes in estimates
520	and deferred maintenance performed during the year and may
521	include factors such as inflation and earnings on invested
522	funds.
523	2.  If the association maintains a pooled account of two or
524	more of the required reserve assets, the amount of the
525	contribution to the pooled reserve account as disclosed on the
526	proposed budget shall not be less than that required to ensure
527	that the balance on hand at the beginning of the period for
528	which the budget will go into effect plus the projected annual
529	cash inflows over the remaining estimated useful life of all of
530	the assets that make up the reserve pool are equal to or greater
531	than the projected annual cash outflows over the remaining
532	estimated useful lives of all of the assets that make up the
533	reserve pool, based on the current reserve analysis. The
534	projected annual cash inflows may include estimated earnings
535	from investment of principal. The reserve funding formula shall
536	not include any type of balloon payments.
537	(h)  Reserve funds and any interest accruing thereon shall
538	remain in the reserve account or accounts and shall be used only
539	for authorized reserve expenditures unless their use for other
540	purposes is approved in advance by a majority vote at a meeting
541	at which a quorum is present. Prior to turnover of control of an
542	association by a developer to parcel owners, the developer-
543	controlled association shall not vote to use reserves for
544	purposes other than those for which they were intended without
545	the approval of a majority of all nondeveloper voting interests
546	voting in person or by limited proxy at a duly called meeting of
547	the association.
548	(7)  FINANCIAL REPORTING.--Within 90 days after the end of
549	the fiscal year, or annually on the date provided in the bylaws,
550	the association shall prepare and complete, or contract with a
551	third party for the preparation and completion of, a financial
552	report for the preceding fiscal year. Within 21 days after the
553	final financial report is completed by the association or
554	received from the third party, but not later than 120 days after
555	the end of the fiscal year or other date as provided in the
556	bylaws, the association shall prepare an annual financial report
557	within 60 days after the close of the fiscal year. The
558	association shall, within the time limits set forth in
559	subsection (5), provide each member with a copy of the annual
560	financial report or a written notice that a copy of the
561	financial report is available upon request at no charge to the
562	member. Financial reports shall be prepared as follows:
563	(a)  An association that meets the criteria of this
564	paragraph shall prepare or cause to be prepared a complete set
565	of financial statements in accordance with generally accepted
566	accounting principles as adopted by the Board of Accountancy.
567	The financial statements shall be based upon the association's
568	total annual revenues, as follows:
569	1.  An association with total annual revenues of $100,000
570	or more, but less than $200,000, shall prepare compiled
571	financial statements.
572	2.  An association with total annual revenues of at least
573	$200,000, but less than $400,000, shall prepare reviewed
574	financial statements.
575	3.  An association with total annual revenues of $400,000
576	or more shall prepare audited financial statements.
577	(b)1.  An association with total annual revenues of less
578	than $100,000 shall prepare a report of cash receipts and
579	expenditures.
580	2.  An association in a community of fewer than 50 parcels,
581	regardless of the association's annual revenues, may prepare a
582	report of cash receipts and expenditures in lieu of financial
583	statements required by paragraph (a) unless the governing
584	documents provide otherwise.
585	3.  A report of cash receipts and disbursement must
586	disclose the amount of receipts by accounts and receipt
587	classifications and the amount of expenses by accounts and
588	expense classifications, including, but not limited to, the
589	following, as applicable: costs for security, professional, and
590	management fees and expenses; taxes; costs for recreation
591	facilities; expenses for refuse collection and utility services;
592	expenses for lawn care; costs for building maintenance and
593	repair; insurance costs; administration and salary expenses; and
594	reserves if maintained by the association.
595	(c)  If 20 percent of the parcel owners petition the board
596	for a level of financial reporting higher than that required by
597	this section, the association shall duly notice and hold a
598	meeting of members within 30 days of receipt of the petition for
599	the purpose of voting on raising the level of reporting for that
600	fiscal year. Upon approval of a majority of the total voting
601	interests of the parcel owners, the association shall prepare or
602	cause to be prepared, shall amend the budget or adopt a special
603	assessment to pay for the financial report regardless of any
604	provision to the contrary in the governing documents, and shall
605	provide within 90 days of the meeting or the end of the fiscal
606	year, whichever occurs later:
607	1.  Compiled, reviewed, or audited financial statements, if
608	the association is otherwise required to prepare a report of
609	cash receipts and expenditures;
610	2.  Reviewed or audited financial statements, if the
611	association is otherwise required to prepare compiled financial
612	statements; or
613	3.  Audited financial statements if the association is
614	otherwise required to prepare reviewed financial statements.
615	(d)  If approved by a majority of the voting interests
616	present at a properly called meeting of the association, an
617	association may prepare or cause to be prepared:
618	1.  A report of cash receipts and expenditures in lieu of a
619	compiled, reviewed, or audited financial statement;
620	2.  A report of cash receipts and expenditures or a
621	compiled financial statement in lieu of a reviewed or audited
622	financial statement; or
623	3.  A report of cash receipts and expenditures, a compiled
624	financial statement, or a reviewed financial statement in lieu
625	of an audited financial statement.
626	Section 10.  Subsection (2) of section 720.303, Florida
627	Statutes, as amended by section 2 of chapter 2004-345 and
628	section 15 of chapter 2004-353, Laws of Florida, is repealed.
629	Section 11.  Section 720.3035, Florida Statutes, is created
630	to read:
631	720.3035  Architectural control covenants; parcel owner
632	improvements; rights and privileges.--
633	(1)  The authority of an association or any architectural,
634	construction improvement, or other such similar committee of an
635	association to review and approve plans and specifications for
636	the location, size, type, or appearance of any structure or
637	other improvement on a parcel, or to enforce standards for the
638	external appearance of any structure or improvement located on a
639	parcel, shall be permitted only to the extent that the authority
640	is specifically stated or reasonably inferred as to such
641	location, size, type, or appearance in the declaration of
642	covenants or other published guidelines and standards authorized
643	by the declaration of covenants.
644	(2)  If the declaration of covenants or other published
645	guidelines and standards authorized by the declaration of
646	covenants provide options for the use of material, the size of
647	the structure or improvement, the design of the structure or
648	improvement, or the location of the structure or improvement on
649	the parcel, neither the association nor any architectural,
650	construction improvement, or other such similar committee of the
651	association shall restrict the right of a parcel owner to select
652	from the options provided in the declaration of covenants or
653	other published guidelines and standards authorized by the
654	declaration of covenants.
655	(3)  Unless otherwise specifically stated in the
656	declaration of covenants or other published guidelines and
657	standards authorized by the declaration of covenants, each
658	parcel shall be deemed to have only one front for purposes of
659	determining the required front setback even if the parcel is
660	bounded by a roadway or other easement on more than one side.
661	When the declaration of covenants or other published guidelines
662	and standards authorized by the declaration of covenants do not
663	provide for specific setback limitations, the applicable county
664	or municipal setback limitations shall apply, and neither the
665	association nor any architectural, construction improvement, or
666	other such similar committee of the association shall enforce or
667	attempt to enforce any setback limitation that is inconsistent
668	with the applicable county or municipal standard or standards.
669	(4)  Each parcel owner shall be entitled to the rights and
670	privileges set forth in the declaration of covenants or other
671	published guidelines and standards authorized by the declaration
672	of covenants concerning the architectural use of the parcel, and
673	the construction of permitted structures and improvements on the
674	parcel and such rights and privileges shall not be unreasonably
675	infringed upon or impaired by the association or any
676	architectural, construction improvement, or other such similar
677	committee of the association. If the association or any
678	architectural, construction improvement, or other such similar
679	committee of the association should unreasonably, knowingly, and
680	willfully infringe upon or impair the rights and privileges set
681	forth in the declaration of covenants or other published
682	guidelines and standards authorized by the declaration of
683	covenants, the adversely affected parcel owner shall be entitled
684	to recover damages caused by such infringement or impairment,
685	including any costs and reasonable attorney's fees incurred in
686	preserving or restoring the rights and privileges of the parcel
687	owner set forth in the declaration of covenants or other
688	published guidelines and standards authorized by the declaration
689	of covenants.
690	(5)  Neither the association nor any architectural,
691	construction improvement, or other such similar committee of the
692	association shall enforce any policy or restriction that is
693	inconsistent with the rights and privileges of a parcel owner
694	set forth in the declaration of covenants or other published
695	guidelines and standards authorized by the declaration of
696	covenants, whether uniformly applied or not. Neither the
697	association nor any architectural, construction improvement, or
698	other such similar committee of the association may rely upon a
699	policy or restriction that is inconsistent with the declaration
700	of covenants or other published guidelines and standards
701	authorized by the declaration of covenants, whether uniformly
702	applied or not, in defense of any action taken in the name of or
703	on behalf of the association against a parcel owner.
704	Section 12.  Subsection (1) of section 720.305, Florida
705	Statutes, is amended to read:
706	720.305  Obligations of members; remedies at law or in
707	equity; levy of fines and suspension of use rights; failure to
708	fill sufficient number of vacancies on board of directors to
709	constitute a quorum; appointment of receiver upon petition of
710	any member.--
711	(1)  Each member and the member's tenants, guests, and
712	invitees, and each association, are governed by, and must comply
713	with, this chapter, the governing documents of the community,
714	and the rules of the association. Actions at law or in equity,
715	or both, to redress alleged failure or refusal to comply with
716	these provisions may be brought by the association or by any
717	member against:
718	(a)  The association;
719	(b)  A member;
720	(c)  Any director or officer of an association who
721	willfully and knowingly fails to comply with these provisions;
722	and
723	(d)  Any tenants, guests, or invitees occupying a parcel or
724	using the common areas.
725
726	The prevailing party in any such litigation is entitled to
727	recover reasonable attorney's fees and costs. A member
728	prevailing in an action between the association and the member
729	under this section, in addition to recovering his or her
730	reasonable attorney's fees, may recover additional amounts as
731	determined by the court to be necessary to reimburse the member
732	for his or her share of assessments levied by the association to
733	fund its expenses of the litigation. This relief does not
734	exclude other remedies provided by law. This section does not
735	deprive any person of any other available right or remedy.
736	Section 13.  Paragraph (c) of subsection (1) of section
737	720.306, Florida Statutes, is amended to read:
738	720.306  Meetings of members; voting and election
739	procedures; amendments.--
740	(1)  QUORUM; AMENDMENTS.--
741	(c)  Unless otherwise provided in the governing documents
742	as originally recorded or permitted by this chapter or chapter
743	617, an amendment may not materially and adversely alter the
744	proportionate voting interest appurtenant to a parcel or
745	increase the proportion or percentage by which a parcel shares
746	in the common expenses of the association unless the record
747	parcel owner and all record owners of liens on the parcels join
748	in the execution of the amendment. For purposes of this section,
749	a change in quorum requirements is not an alteration of voting
750	interests. The merger or consolidation of one or more
751	associations under a plan of merger or consolidation under
752	chapter 607 or chapter 617 shall not be considered a material or
753	adverse alteration of the proportionate voting interest
754	appurtenant to a parcel.
755	Section 14.  Paragraph (t) is added to subsection (3) of
756	section 720.307, Florida Statutes, to read:
757	720.307  Transition of association control in a
758	community.--With respect to homeowners' associations:
759	(3)  At the time the members are entitled to elect at least
760	a majority of the board of directors of the homeowners'
761	association, the developer shall, at the developer's expense,
762	within no more than 90 days deliver the following documents to
763	the board:
764	(t)  The financial records, including financial statements
765	of the association, and source documents from the incorporation
766	of the association through the date of turnover. The records
767	shall be audited by an independent certified public accountant
768	for the period from the incorporation of the association or from
769	the period covered by the last audit if an audit has been
770	performed for each fiscal year since incorporation. All
771	financial statements shall be prepared in accordance with
772	generally accepted accounting principles and shall be audited in
773	accordance with generally accepted auditing standards, as
774	prescribed by the Board of Accountancy, pursuant to chapter 473.
775	The certified public accountant performing the audit shall
776	examine to the extent necessary supporting documents and
777	records, including the cash disbursements and related paid
778	invoices, to determine whether expenditures were for association
779	purposes and the billings, cash receipts, and related records of
780	the association to determine whether the developer was charged
781	and paid the proper amounts of assessments. This paragraph
782	applies to associations with a date of incorporation after
783	December 31, 2007.
784	Section 15.  Section 720.308, Florida Statutes, is amended
785	to read:
786	720.308  Assessments and charges.--
787	(1)  ASSESSMENTS.--For any community created after October
788	1, 1995, the governing documents must describe the manner in
789	which expenses are shared and specify the member's proportional
790	share thereof. Assessments levied pursuant to the annual budget
791	or special assessment must be in the member's proportional share
792	of expenses as described in the governing document, which share
793	may be different among classes of parcels based upon the state
794	of development thereof, levels of services received by the
795	applicable members, or other relevant factors. While the
796	developer is in control of the homeowners' association, it may
797	be excused from payment of its share of the operating expenses
798	and assessments related to its parcels for any period of time
799	for which the developer has, in the declaration, obligated
800	itself to pay any operating expenses incurred that exceed the
801	assessments receivable from other members and other income of
802	the association. This section does not apply to an association,
803	no matter when created, if the association is created in a
804	community that is included in an effective development-of-
805	regional-impact development order as of the effective date of
806	this act, together with any approved modifications thereto.
807	(2)  GUARANTEES OF COMMON EXPENSES.--
808	(a)  Establishment of a guarantee.--If a guarantee of the
809	assessments of parcel owners is not included in the purchase
810	contracts or declaration, any agreement establishing a guarantee
811	shall only be effective upon the approval of a majority of the
812	voting interests of the members other than the developer.
813	Approval shall be expressed at a meeting of the members voting
814	in person or by limited proxy or by agreement in writing without
815	a meeting if provided in the bylaws. Such guarantee must meet
816	the requirements of this section.
817	(b)  Guarantee period.--The period of time for the
818	guarantee shall be indicated by a specific beginning and ending
819	date or event.
820	1.  The ending date or event shall be the same for all of
821	the members of an association, including members in different
822	phases of the development.
823	2.  The guarantee may provide for different intervals of
824	time during a guarantee period with a different dollar amount
825	for each such interval.
826	3.  The guarantee may provide that after the initial stated
827	period, the developer has an option to extend the guarantee for
828	one or more additional stated periods. The extension of a
829	guarantee is limited to extending the ending date or event;
830	therefore, the developer does not have the option of changing
831	the level of assessments guaranteed.
832	(3)  MAXIMUM LEVEL OF ASSESSMENTS.--The stated dollar
833	amount of the guarantee shall be an exact dollar amount for each
834	parcel identified in the declaration. Regardless of the stated
835	dollar amount of the guarantee, assessments charged to a member
836	shall not exceed the maximum obligation of the member based on
837	the total amount of the adopted budget and the member's
838	proportionate share of the expenses as described in the
839	governing documents.
840	(4)  CASH FUNDING REQUIREMENTS DURING GUARANTEE.--The cash
841	payments required from the guarantor during the guarantee period
842	shall be determined as follows:
843	(a)  If at any time during the guarantee period the funds
844	collected from member assessments at the guaranteed level and
845	other revenues collected by the association are not sufficient
846	to provide payment, on a timely basis, of all assessments,
847	including the full funding of the reserves unless properly
848	waived, the guarantor shall advance sufficient cash to the
849	association at the time such payments are due.
850	(b)  Expenses incurred in the production of nonassessment
851	revenues, not in excess of the nonassessment revenues, shall not
852	be included in the assessments. If the expenses attributable to
853	nonassessment revenues exceed nonassessment revenues, only the
854	excess expenses must be funded by the guarantor. Interest earned
855	on the investment of association funds may be used to pay the
856	income tax expense incurred as a result of the investment, such
857	expense shall not be charged to the guarantor, and the net
858	investment income shall be retained by the association. Each
859	such nonassessment-revenue-generating activity shall be
860	considered separately. Any portion of the parcel assessment that
861	is budgeted for designated capital contributions of the
862	association shall not be used to pay operating expenses.
863	(5)  CALCULATION OF GUARANTOR'S FINAL OBLIGATION.--The
864	guarantor's total financial obligation to the association at the
865	end of the guarantee period shall be determined on the accrual
866	basis using the following formula: the guarantor shall pay any
867	deficits that exceed the guaranteed amount, less the total
868	regular periodic assessments earned by the association from the
869	members other than the guarantor during the guarantee period
870	regardless of whether the actual level charged was less than the
871	maximum guaranteed amount.
872	(6)  EXPENSES.--Expenses incurred in the production of
873	nonassessment revenues, not in excess of the nonassessment
874	revenues, shall not be included in the operating expenses. If
875	the expenses attributable to nonassessment revenues exceed
876	nonassessment revenues, only the excess expenses must be funded
877	by the guarantor. Interest earned on the investment of
878	association funds may be used to pay the income tax expense
879	incurred as a result of the investment, such expense shall not
880	be charged to the guarantor, and the net investment income shall
881	be retained by the association. Each such nonassessment-revenue-
882	generating activity shall be considered separately. Any portion
883	of the parcel assessment that is budgeted for designated capital
884	contributions of the association shall not be used to pay
885	operating expenses.
886	Section 16.  Section 720.311, Florida Statutes, is amended
887	to read:
888	720.311  Dispute resolution.--
889	(1)  The Legislature finds that alternative dispute
890	resolution has made progress in reducing court dockets and
891	trials and in offering a more efficient, cost-effective option
892	to litigation. The filing of any petition for mediation or
893	arbitration or the serving of a demand for presuit mediation as
894	provided for in this section shall toll the applicable statute
895	of limitations. Any recall dispute filed with the department
896	pursuant to s. 720.303(10) shall be conducted by the department
897	in accordance with the provisions of ss. 718.112(2)(j) and
898	718.1255 and the rules adopted by the division. In addition, the
899	department shall conduct mandatory binding arbitration of
900	election disputes between a member and an association pursuant
901	to s. 718.1255 and rules adopted by the division. Neither
902	election disputes nor recall disputes are eligible for presuit
903	mediation; these disputes shall be arbitrated by the department.
904	At the conclusion of the proceeding, the department shall charge
905	the parties a fee in an amount adequate to cover all costs and
906	expenses incurred by the department in conducting the
907	proceeding. Initially, the petitioner shall remit a filing fee
908	of at least $200 to the department. The fees paid to the
909	department shall become a recoverable cost in the arbitration
910	proceeding, and the prevailing party in an arbitration
911	proceeding shall recover its reasonable costs and attorney's
912	fees in an amount found reasonable by the arbitrator. The
913	department shall adopt rules to effectuate the purposes of this
914	section.
915	(2)(a)  Disputes between an association and a parcel owner
916	regarding use of or changes to the parcel or the common areas
917	and other covenant enforcement disputes, disputes regarding
918	amendments to the association documents, disputes regarding
919	meetings of the board and committees appointed by the board,
920	membership meetings not including election meetings, and access
921	to the official records of the association shall be the subject
922	of a demand filed with the department for presuit mandatory
923	mediation served by an aggrieved party before the dispute is
924	filed in court. Presuit mediation proceedings must be conducted
925	in accordance with the applicable Florida Rules of Civil
926	Procedure, and these proceedings are privileged and confidential
927	to the same extent as court-ordered mediation. Disputes subject
928	to presuit mediation under this section shall not include the
929	collection of any assessment, fine, or other financial
930	obligation, including attorney's fees and costs, claimed to be
931	due or any action to enforce a prior mediation settlement
932	agreement between the parties. Also, in any dispute subject to
933	presuit mediation under this section where emergency relief is
934	required, a motion for temporary injunctive relief may be filed
935	with the court without first complying with the presuit
936	mediation requirements of this section. After any issues
937	regarding emergency or temporary relief are resolved, the court
938	may either refer the parties to a mediation program administered
939	by the courts or require mediation under this section. An
940	arbitrator or judge may not consider any information or evidence
941	arising from the presuit mediation proceeding except in a
942	proceeding to impose sanctions for failure to attend a presuit
943	mediation session or to enforce a mediated settlement agreement.
944	Persons who are not parties to the dispute may not attend the
945	presuit mediation conference without the consent of all parties,
946	except for counsel for the parties and a corporate
947	representative designated by the association. When mediation is
948	attended by a quorum of the board, such mediation is not a board
949	meeting for purposes of notice and participation set forth in s.
950	720.303. An aggrieved party shall serve on the responding party
951	a written demand to participate in presuit mediation in
952	substantially the following form:
953
954	STATUTORY OFFER TO PARTICIPATE IN PRESUIT MEDIATION
955
956	The alleged aggrieved party,__________________, hereby demands
957	that_________________, as the responding party, engage in
958	mandatory presuit mediation in connection with the following
959	disputes, which by statute are of a type that are subject to
960	presuit mediation:
961
962	(List specific nature of the dispute or disputes to be mediated
963	and the authority supporting a finding of a violation as to each
964	dispute.)
965
966	Pursuant to section 720.311, Florida Statutes, this demand to
967	resolve the dispute through presuit mediation is required before
968	a lawsuit can be filed concerning the dispute. Pursuant to the
969	statute, the parties are required to engage in presuit mediation
970	with a neutral third-party mediator in order to attempt to
971	resolve this dispute without court action, and the aggrieved
972	party demands that you likewise agree to this process. If you
973	fail to participate in the mediation process, suit may be
974	brought against you without further warning.
975
976	The process of mediation involves a supervised negotiation
977	process in which a trained, neutral third-party mediator meets
978	with both parties and assists them in exploring possible
979	opportunities for resolving part or all of the dispute. By
980	agreeing to participate in presuit mediation, you are not bound
981	in any way to change your position. Furthermore, the mediator
982	has no authority to make any decisions in this matter or to
983	determine who is right or wrong and merely acts as a facilitator
984	to ensure that each party understands the position of the other
985	party and that all options for reasonable settlement are fully
986	explored.
987
988	If an agreement is reached, it shall be reduced to writing and
989	becomes a binding and enforceable commitment of the parties. A
990	resolution of one or more disputes in this fashion avoids the
991	need to litigate these issues in court. The failure to reach an
992	agreement, or the failure of a party to participate in the
993	process, results in the mediator declaring an impasse in the
994	mediation, after which the aggrieved party may proceed to court
995	on all outstanding, unsettled disputes. If you have failed or
996	refused to participate in the entire mediation process, you will
997	not be entitled to recover attorney's fees, even if you prevail.
998
999	The aggrieved party has selected and hereby lists five certified
1000	mediators who we believe to be neutral and qualified to mediate
1001	the dispute. You have the right to select any one of these
1002	mediators. The fact that one party may be familiar with one or
1003	more of the listed mediators does not mean that the mediator
1004	cannot act as a neutral and impartial facilitator. Any mediator
1005	who cannot act in this capacity is required ethically to decline
1006	to accept engagement. The mediators whom we suggest, and their
1007	current hourly rates, are as follows:
1008
1009	(List the names, addresses, telephone numbers, and hourly rates
1010	of the mediators. Other pertinent information about the
1011	background of the mediators may be included as an attachment.)
1012
1013	You may contact the offices of these mediators to confirm that
1014	the listed mediators will be neutral and will not show any
1015	favoritism toward either party. The Florida Supreme Court can
1016	provide you a list of certified mediators.
1017
1018	Unless otherwise agreed by the parties, section 720.311(2)(b),
1019	Florida Statutes, requires that the parties share the costs of
1020	presuit mediation equally, including the fee charged by the
1021	mediator. An average mediation may require three to four hours
1022	of the mediator's time, including some preparation time, and the
1023	parties would need to share equally the mediator's fees as well
1024	as their own attorney's fees if they choose to employ an
1025	attorney in connection with the mediation. However, use of an
1026	attorney is not required and is at the option of each party. The
1027	mediators may require the advance payment of some or all of the
1028	anticipated fees. The aggrieved party hereby agrees to pay or
1029	prepay one-half of the mediator's estimated fees and to forward
1030	this amount or such other reasonable advance deposits as the
1031	mediator requires for this purpose. Any funds deposited will be
1032	returned to you if these are in excess of your share of the fees
1033	incurred.
1034
1035	To begin your participation in presuit mediation to try to
1036	resolve the dispute and avoid further legal action, please sign
1037	below and clearly indicate which mediator is acceptable to you.
1038	We will then ask the mediator to schedule a mutually convenient
1039	time and place for the mediation conference to be held. The
1040	mediation conference must be held within ninety (90) days of
1041	this date, unless extended by mutual written agreement. In the
1042	event that you fail to respond within 20 days from the date of
1043	this letter, or if you fail to agree to at least one of the
1044	mediators that we have suggested or to pay or prepay to the
1045	mediator one-half of the costs involved, the aggrieved party
1046	will be authorized to proceed with the filing of a lawsuit
1047	against you without further notice and may seek an award of
1048	attorney's fees or costs incurred in attempting to obtain
1049	mediation.
1050
1051	Therefore, please give this matter your immediate attention. By
1052	law, your response must be mailed by certified mail, return
1053	receipt requested, and by first-class mail to the address shown
1054	on this demand.
1055
1056	_____________________
1057	_____________________
1058
1059	RESPONDING PARTY: YOUR SIGNATURE INDICATES YOUR AGREEMENT TO
1060	THAT CHOICE.
1061	AGREEMENT TO MEDIATE
1062
1063	The undersigned hereby agrees to participate in presuit
1064	mediation and agrees to attend a mediation conducted by the
1065	following mediator or mediators who are listed above as someone
1066	who would be acceptable to mediate this dispute:
1067
1068	(List acceptable mediator or mediators.)
1069
1070	I/we further agree to pay or prepay one-half of the mediator's
1071	fees and to forward such advance deposits as the mediator may
1072	require for this purpose.
1073
1074	_______________________
1075	Signature of responding party #1
1076
1077	_______________________
1078
1079	Telephone contact information
1080
1081	_______________________
1082	Signature and telephone contact information of responding party
1083	#2 (if applicable)(if property is owned by more than one person,
1084	all owners must sign)
1085
1086	(b)  Service of the statutory demand to participate in
1087	presuit mediation shall be effected by sending a letter in
1088	substantial conformity with the above form by certified mail,
1089	return receipt requested, with an additional copy being sent by
1090	regular first-class mail, to the address of the responding party
1091	as it last appears on the books and records of the association.
1092	The responding party has 20 days from the date of the mailing of
1093	the statutory demand to serve a response to the aggrieved party
1094	in writing. The response shall be served by certified mail,
1095	return receipt requested, with an additional copy being sent by
1096	regular first-class mail, to the address shown on the statutory
1097	demand. Notwithstanding the foregoing, once the parties have
1098	agreed on a mediator, the mediator may reschedule the mediation
1099	for a date and time mutually convenient to the parties. The
1100	department shall conduct the proceedings through the use of
1101	department mediators or refer the disputes to private mediators
1102	who have been duly certified by the department as provided in
1103	paragraph (c). The parties shall share the costs of presuit
1104	mediation equally, including the fee charged by the mediator, if
1105	any, unless the parties agree otherwise, and the mediator may
1106	require advance payment of his or her reasonable fees and costs.
1107	The failure of any party to respond to a demand or response, to
1108	agree upon a mediator, to make payment of fees and costs within
1109	the time established by the mediator, or to appear for a
1110	scheduled mediation session without the approval of the
1111	mediator, shall constitute the failure or refusal to participate
1112	in the mediation process and shall operate as an impasse in the
1113	presuit mediation by such party, entitling the other party to
1114	proceed in court and to seek an award of the costs and fees
1115	associated with the mediation. Additionally, notwithstanding the
1116	provisions of any other law or document, persons who fail or
1117	refuse to participate in the entire mediation process may not
1118	recover attorney's fees and costs in subsequent litigation
1119	relating to the dispute. If any presuit mediation session cannot
1120	be scheduled and conducted within 90 days after the offer to
1121	participate in mediation was filed, an impasse shall be deemed
1122	to have occurred unless both parties agree to extend this
1123	deadline. If a department mediator is used, the department may
1124	charge such fee as is necessary to pay expenses of the
1125	mediation, including, but not limited to, the salary and
1126	benefits of the mediator and any travel expenses incurred. The
1127	petitioner shall initially file with the department upon filing
1128	the disputes, a filing fee of $200, which shall be used to
1129	defray the costs of the mediation. At the conclusion of the
1130	mediation, the department shall charge to the parties, to be
1131	shared equally unless otherwise agreed by the parties, such
1132	further fees as are necessary to fully reimburse the department
1133	for all expenses incurred in the mediation.
1134	(c)(b)  If presuit mediation as described in paragraph (a)
1135	is not successful in resolving all issues between the parties,
1136	the parties may file the unresolved dispute in a court of
1137	competent jurisdiction or elect to enter into binding or
1138	nonbinding arbitration pursuant to the procedures set forth in
1139	s. 718.1255 and rules adopted by the division, with the
1140	arbitration proceeding to be conducted by a department
1141	arbitrator or by a private arbitrator certified by the
1142	department. If all parties do not agree to arbitration
1143	proceedings following an unsuccessful presuit mediation, any
1144	party may file the dispute in court. A final order resulting
1145	from nonbinding arbitration is final and enforceable in the
1146	courts if a complaint for trial de novo is not filed in a court
1147	of competent jurisdiction within 30 days after entry of the
1148	order. As to any issue or dispute that is not resolved at
1149	presuit mediation, and as to any issue that is settled at
1150	presuit mediation but is thereafter subject to an action seeking
1151	enforcement of the mediation settlement, the prevailing party in
1152	any subsequent arbitration or litigation proceeding shall be
1153	entitled to seek recovery of all costs and attorney's fees
1154	incurred in the presuit mediation process.
1155	(d)(c)  The department shall develop a certification and
1156	training program for private mediators and private arbitrators
1157	which shall emphasize experience and expertise in the area of
1158	the operation of community associations. A mediator or
1159	arbitrator shall be authorized to conduct mediation or
1160	arbitration under this section certified by the department only
1161	if he or she has been certified as a circuit court civil
1162	mediator or arbitrator, respectively, pursuant to the
1163	requirements established attended at least 20 hours of training
1164	in mediation or arbitration, as appropriate, and only if the
1165	applicant has mediated or arbitrated at least 10 disputes
1166	involving community associations within 5 years prior to the
1167	date of the application, or has mediated or arbitrated 10
1168	disputes in any area within 5 years prior to the date of
1169	application and has completed 20 hours of training in community
1170	association disputes. In order to be certified by the
1171	department, any mediator must also be certified by the Florida
1172	Supreme Court. Settlement agreements resulting from mediation
1173	shall not have precedential value in proceedings involving
1174	parties other than those participating in the mediation to
1175	support either a claim or defense in other disputes. The
1176	department may conduct the training and certification program
1177	within the department or may contract with an outside vendor to
1178	perform the training or certification. The expenses of operating
1179	the training and certification and training program shall be
1180	paid by the moneys and filing fees generated by the arbitration
1181	of recall and election disputes and by the mediation of those
1182	disputes referred to in this subsection and by the training
1183	fees.
1184	(e)(d)  The presuit mediation procedures provided by this
1185	subsection may be used by a Florida corporation responsible for
1186	the operation of a community in which the voting members are
1187	parcel owners or their representatives, in which membership in
1188	the corporation is not a mandatory condition of parcel
1189	ownership, or which is not authorized to impose an assessment
1190	that may become a lien on the parcel.
1191	(3)  The department shall develop an education program to
1192	assist homeowners, associations, board members, and managers in
1193	understanding and increasing awareness of the operation of
1194	homeowners' associations pursuant to this chapter and in
1195	understanding the use of alternative dispute resolution
1196	techniques in resolving disputes between parcel owners and
1197	associations or between owners. Such education program may
1198	include the development of pamphlets and other written
1199	instructional guides, the holding of classes and meetings by
1200	department employees or outside vendors, as the department
1201	determines, and the creation and maintenance of a website
1202	containing instructional materials. The expenses of operating
1203	the education program shall be initially paid by the moneys and
1204	filing fees generated by the arbitration of recall and election
1205	disputes and by the mediation of those disputes referred to in
1206	this subsection.
1207	Section 17.  Except as otherwise expressly provided in this
1208	act, this act shall take effect July 1, 2007.

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