I’ll tell you something – I give a lot of credit to Kathy
Fernandez Rundle, The State Attorney for Miami-Dade County. She
actually prosecutes cases of condo fraud, years ago she
assembled a grand jury to make recommendations to the state
legislature regarding condo crimes, kickbacks, conflicts of
interest and the grand jury’s findings turned into legislation
---------- and now, in light of the tragedy in Surfise at The
Champlain Towers collapse where 98 innocent people lost their
lives ----- she assembled another fact finding grand jury, this
time to investigate the laws regarding inspections of our
buildings and how we waive reserve funds.
The last Miami Dade Grand Jury wrote a scathing report
regarding condo crime, saying it was rampant --- and people get
on the board just to divert the condo’s business to their
relatives or even their own companies. Well, this Grand Jury
pulled no punches either.
As you know, the current law allows all condos the
opportunity to waive the full funding of reserve accounts for
major repairs or replacements. All it takes is a lousy vote of
a majority of a quorum of the owners who attend a meeting. So,
if in your 100 unit condo, a quorum of owners is typically 50 or
less. So, if 50 or more people show up either in person or by
proxy, a majority of them can change the budget to completely
exclude reserves, and as we know it’s typically done year after
year after year.
Here is what the Grand Jury said about that:
“We Are At A
Loss To Understand Why Such Language Would Even Be Included In
The Florida Condominium Act.” They eventually
said that at a minimum, it should at least require a 70% vote of
the owners to waive reserves. So, you can rest assured that
this one finding by the grand jury will work its way into new
condo legislation in the next 2 months as the Florida
Legislature is now in session. It’s going to become real
difficult real soon, to completely refuse to fund your reserve
account. Surprisingly, the grand jury didn’t say a word about
requiring properly licensed personnel to do the reserve account
analysis each year., instead of joe the butcher, fred the cab
driver and joan the teacher, each of whom are not qualified to
do the reserve analysis.
In terms of
the 40 year certification process for Dade and Broward, The
Grand Jury recommended that buildings should be given a 2 year
advanced notice to perform the 40 year inspection. And of
course 40 years is way too long for the first inspection. The
first inspection and certification should be 10 – 15 years after
the building is constructed , and the condominium inspection
should be updated every 10 years. I think you can rest assured
that The Florida Legislature will probably make this a law
throughout the state, not only in d\Dade and Broward counties.
In fact, a bill has already been filed in the senate that would
require the inspection of all condos in the state over 3
stories, after 30 years and every ten years thereafter.
As the law
stands right now in Dade and Broward ---- for the 40 year
certification --- the inspection only involves the structural
and electrical issues. Well, you can throw that right out the
window according to this grand jury. going forward,
Jury recommends that all of the following components must pass
structure, fireproofing and fire protection systems, elevators,
heating and cooling systems, plumbing, electrical systems,
swimming pool or spa and equipment, seawalls, pavement and
parking areas, drainage systems, painting, irrigation systems.
This is a much more comprehensive and much more expensive
inspection report than what we have now. Condos better get
ready to put these costs into their budgets if this legislation
qualifications of the people doing the certifying would
change. The Grand Jury wants any engineer certifying a
building in connection with an inspection ------ must have
previously designed and inspected at least 3 buildings of the
same or greater height as the building to which is to be
Jury opined that building officials must require proof of
waterproofing and painting every 10 years. They specifically
found that ” a failure of condo boards to implement much needed
repairs and maintenance has led to unsafe building structures
throughout South Florida. They reminded everyone that
associations who don’t comply with the insurance company’s
requirement of routine maintenance may result in a denial of the
recommended that building officials should check to see if the
condominium is performing routine maintenance and condo boards
should be required to file a document certifying that regular
routine maintenance has been conducted in the last 12 months.
thankfully, The Grand Jury believes that the education
requirement for board members be expanded. As you know, I
drafted Senate Bill 394 filed by Anna Maria Rodriguez and House
Bill 547 filed by Representative David Borerro, The bill would
require board members to get certified by taking an educational
class rather than getting certified by signing a silly form.
Florida would be the first state in the country to require
that. That would be my legacy and I have my fingers crossed.
All I can say
is……when you factor in the insane rise in the price of
insurance, and the changes we know are coming in this
legislative session, it’s about to get a lot more expensive to
live in your condominium. Get ready to buckle up and hold on.
It’s going to be a bumpy ride.
To view the
actual Grand Jury report