From the Section 22 HOA Board – HOA and COA Laws

If you live in PGI Section 22, in addition to belonging to the PGI Section 22 Homeowners’ Association, chances are you belong to another homeowners’ association (HOA) or a condo owners’ association (COA) or both. There are over 45 HOAs and COAs within Burnt Store Marina (BSM). Some, like my wife Deby and I, belong to both a COA and HOA, some belong to a COA and two HOAs, some belong to two HOAs and some simply belong to PGI Section 22 HOA. If you are not confused enough I need to mention that not all people who live in Burnt Store Marina live in PGI Section 22. There are three communities that are actually part of PGI Section 23 and therefore are not part of the PGI Section 22 HOA.

Hopefully, this article will help you understand what HOAs and COAs are by sharing your rights and obligations as to each type of association. The most important thing to understand is that under Florida law, a HOA and COA are two legally different animals. HOAs are governed by Chapter 720 and COAs are governed by Chapter 718 of the Florida Statutes. Since moving to BSM, I’ve had the honor of being a board member of Harbor Towers COA and the PGI Section 22 HOA. Though the laws are similar, it would be a serious mistake to assume that the laws controlling HOAs and COAs are identical. PGI Section 22 is governed by a homeowners’ association.

PGI Section 22 HOA is controlled not only by Chapter 720 of the Florida Statutes, but also by its Articles of Incorporation, its Declarations, its Bylaws and its Rules and Regulations.

HOAs are tasked with maintaining roads, controlling access to the community, governing the use and maintenance of the common property, operating and owning amenities, and providing and enforcing architectural guidelines.

PGI Section 22 is run by a seven-person Board of Directors, who are unpaid volunteers, elected to a two-year term. Under recent changes to Florida law, there is now an eight-year term limit for board membership. The Board is not only responsible for enforcing the HOA’s rules, making decisions about the use and upkeep of common areas, and operating the association’s amenities, but also handling of the association’s finances.

One of the most important jobs of a HOA Board is agreeing on an annual budget and determining an assessment to fund the operation of the HOA.

An HOA can also appoint committees to help manage HOA responsibilities. For example, in the PGI Section 22 HOA, the Architecture Review Committee (ARC) is empowered with enforcing architectural standards. The Irrigation Committee operates and maintains the community irrigation system. The Section 22 HOA manages roughly six million dollars a year, including the operation of our amenities.

PGI Section 22 is run by a seven-person Board of Directors, who are unpaid volunteers, elected to a two-year term.

Every owner in PGI Section 22 has rights, under Florida law, which are important to be cognizant of. At the heart of Florida HOA and COA laws is transparency:

• There must be open Board meetings. This means owners have a right to attend Board meetings in a convenient venue. Florida law mandates the procedure for HOA Board meetings. • A timely notice of a Board meeting must be published anytime the board meets. This means any meeting, whether formal or informal, such as Section 22 weekly workshop meetings. The notice must include the time, place and nature of the meeting. • It is a violation of Florida’s “Sunshine Law” for a majority of the Board to meet and discuss any board issue without proper notice, even if the meeting is unintentional or unplanned. • Owners are entitled to be at any Board meeting, and must be given an opportunity to speak, and give meaningful input into HOA issues. There are a very limited number of exceptions to this right, such as emergencies and pending litigation. • When the Board formally meets, there must be an agenda provided in advance. • Members of a HOA have a right to access the HOA’s official records. These include contracts, financial records, and HOA governing documents. • Once a request for documents is received, the HOA has ten business days to provide those documents or incur a $50 a day fine until the documents are provided. A Board is entitled to post these items on the HOA website as long as all members have access to the website. Posting financial records, governing documents and contracts on a website can fulfill the request requirement. • Owners have a right to elect Board members in an election that complies with Florida law and the HOA Bylaws.

• The HOA must hold an Annual Meeting in accordance with the HOA’s Bylaws. Board members must openly organize the Board, and ratify standing committees and their membership. All HOA members are entitled to speak. • The HOA must adopt a budget, send a copy to all owners and then have a public meeting where owners are permitted to comment on the budget before it is officially approved by a vote. Members of HOAs and COAs not only have rights, they also have obligations. Members must pay their assessments, follow Florida law, and the rules of the HOAs and COAs. HOAs and COAs are empowered to enforce violations against members who fail to follow the rules or fail to pay their obligations. HOAs and COAs have the power to fine members, and deny privileges to offenders who violates rules and the law. If a member fails to pay his or her financial obligations, a HOA or COA can seek legal judgment against the debtor, file a lien, and can literally foreclose on the owners’ property.

A Condominium Owners’ Associations (COA) is a slightly different animal from a HOA. In a COA, a condominium owner owns their unit, which sits on common ground. In Florida legalese the unit and other dedicated spaces, such as carports, are called limited common elements. This means the owners have an exclusive right to the use of that space. They also have a divisible ownership of common areas, such as a swimming pool, tennis courts, sidewalks, and parking lots. These areas are called common elements because owners have a non- exclusive right to use these common areas. The COA’s documents and Florida law defines what are owner’s and the COA’s obligations when there are required repairs for damages for such things as broken pipes.

Like an HOA, a COA is operated by a voluntary unpaid Board of Directors. COAs are controlled by Chapter 718 of the Florida Statutes. The COA is controlled by Florida Statute and Board governance documents, such as the COA’s Declarations, Bylaws, and Rules and Regulations. The COA assessments pay for shared maintenance of the COA property, such as the pool, landscaping and parking lots. It can also provide for common services, such as insurance, trash, water, cable and internet services.

COA owners have similar rights as HOA owners. These include open meetings, defined agendas, notice of meetings, the right to speak, the right to see COA documents and transparency.

HOA and COA laws are constantly charging. Our Florida legislature seems to be obsessed with tinkering with this area of the law. Don’t assume that the law you acted on two years ago hasn’t been changed or modified. HOA and COA management companies belong to large trade groups and are typically affiliated with law firms that specialize in this area of the law. They are generally good sources for evolving areas of the law.

COA owners have similar rights as HOA owners. These include open meetings, defined agendas, notice of meetings, the right to speak, the right to see COA documents and transparency.

No area of Florida law has received more attention recently than COA law. Hurricanes have driven up the cost of insurance to almost unaffordable levels. Equally important legislation following the Surfside Condo collapse is causing Draconian consequences to condo owners. This legislation was entered into with good intent, but has resulted in what I love to call “the rule of unintended consequences.” The legislation dictated COAs over a certain age, size and location undergo a structural examination. Equally important it also mandated what is known a “SIRS” study. A SIRS study is a Structural Integrity Reserve Study. Under the Surfside legislation, COAs, who must complete these requirements, are being forced to assess, in some cases, tens of thousands of dollars in special assessments, or double or triple monthly fees to fund structural reserves for their condo community as a result of the SIRS studies.

No area of Florida law has received more attention recently than COA law. Hurricanes have driven up the cost of insurance to almost unaffordable levels.

Governor Ron DeSantis has been calling for a special session of the Florida legislature to deal with the COA crisis, saying it was never the intent to force COA members into near bankruptcy to comply with a law intended to help, not hurt, COA owners. So far the Florida legislature has not reacted to Governor DeSantis’ request. It’s important we let our state legislators know the importance of reforming the Surfside legislation by providing fair laws that help us, not hurt us.

The over 45 HOAs and COAs in Burnt Store Marina are governed by voluntary boards and their committee members. Each board and committee member is a non-paid owner who serves with a goal to make our community a better place to live. Board and committee members are our neighbors and our friends. It’s easy to forget the amount of time board and committee membership can require. We certainly all have a right to disagree with our HOA and COA decisions. When you disagree, do so with respect for the time and effort that the board or committee has put into a thankless job. Better yet, volunteer to be a board or committee member! On behalf of the seven members of PGI Section 22 Board, I would to thank each board and committee member who serves on our communities’ HOAs and COAs. I thank you for volunteering your time and your energy

As we say in Navy semaphore “Bravo Zulu” or in plain English “well done”!

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