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Published on May 1, 2002
Frequently Asked Questions
1. What reserve accounts are
condominiums required to maintain?
A: The Condominium Act requires the following reserve accounts be in the
proposed budget:
- roof replacement
- building painting
- pavement resurfacing
- any other item for which the deferred maintenance expense or replacement
cost exceeds $10,000.
However, a condominium association may waive this requirement or reduce
the funding of the reserves, for a fiscal year, by a vote of the majority
of the voting interests present in person or by limited proxy at a duly
called association meeting.
Section 718.112(2)(f) 2.,
Florida Statutes (F.S.)
2. What is the difference between
a capital expenditure and deferred maintenance?
A: "Capital expenditure" is defined in Rule 61B-22.001(2),
Florida Administrative Code, as any expenditure of funds for:
(a) The purchase of an asset whose useful life is greater than one year in
length;
(b) The replacement of an asset whose useful life is greater than one year
in length; or
(c) The addition to an asset that extends the useful life of the
previously existing asset for a period of greater than one year in length.
B: "Deferred
maintenance" is defined in Rule 61B-22.001(3), Florida Administrative
Code, as any maintenance or repair that:
(a) Will be performed less frequently than yearly; and
(b) Will result in maintaining the useful life of an asset.
Rules 61B-22.001(2)&(3), F.A.C.
3. May a reserve account be used for
purposes other than that for which it was originally intended?
A: The Condominium Act requires that reserve funds and any interest
accruing thereon remain in the reserve account or accounts, and be used
only for the purpose(s) for which they originally were set aside. However,
funds in a reserve account may be used for other purposes if approved in
advance by a majority vote at a duly called association
Section 718.112(2)(f) 3.,
F.S.
4. In an association that
funds reserves, if unit owners write one check to pay their shares of
quarterly assessments - - and the association deposits these checks into
their operating account, is this considered commingling?
A: Not if the
association transfers the reserve portion of the payments to the
respective reserve account(s) within thirty days of the deposit. Further,
it is not considered commingling if the accounts are combined for
investment purposes (the monies must still be accounted for separately).
Section 718.111(15), F.S.
Rule 61B-22.005(2), F.A.C.
5. May candidates for the board of
administration engage in campaigning for election?
A: The Condominium Act and the
related administrative rules do not address the topic of campaigning for
election. Condominium associations need to refer to their governing
documents to determine if any regulations exist concerning campaigning
issues. The Condominium Act does provide for the use of an information
sheet for candidates to submit to the board to be included with the second
notice of election. The information sheet can include the background,
education and qualifications of the candidate as well as other factors
deemed relevant by the candidate. The information may not be altered or
edited by the association.
Section 718.112(2)(d) 3.
F.S., Rules 61B-23.0021(7)&(8), F.A.C.
6. May the board of
administration simply appoint an individual to fill a vacated position on
the board without conducting an election?
A: If a vacancy on the board of administration occurs due to a
resignation, or any other reason prior to the expiration of the term
(except in the event of a recall), the position may be filled by the
affirmative vote of the majority of the remaining directors, even if the
remaining directors constitute less than a quorum, or by the sole
remaining director. The board may, at its discretion,
hold an election to fill the vacant position.
Section 718.112(2)(d) 8.,
F.S.
7. What if during the election process,
an association has the same number of candidates for positions to be
filled as there are vacancies on the board? Do they still need to prepare
ballots and hold an election?
A: No. If the association has the same number of candidates, as there are
vacancies to be filled, there is no need for balloting. In this situation,
not later than the date of the scheduled election, the association can
either call and hold a meeting of the membership to announce the names of
the new board members, notify the unit owners by mail of the names of the
new board members, or the announcement can be made at the annual meeting.
Section 718.112(2)(d) 3.,
F.S. Rule 61B-23.0021(1)(b), F.A.C.
8. Is an association permitted to use
proxies in the election of directors?
A: In 1995 the Condominium Act was amended to grant associations the
ability to opt out of the standard election process. If your association,
by vote of a majority of the total voting interests, has adopted alternate
election procedures, elections may actually be conducted using proxies
instead of a secret ballot. If alternate election procedures have not been
adopted, proxies cannot be used.
Section 718.112(2)(b), F.S.
Section 718.112(2)(d), F.S.
9. May the board fine unit owners for
breaking the association's rules?
A: If the declaration or bylaws so provide, the association may levy
reasonable fines against a unit for the failure of the owner of the unit,
or its occupant, licensee, or invitee, to comply with any provision of the
declaration, the association bylaws, or reasonable rules of the
association. No fine may exceed $100 per violation. However, a fine may be
levied on the basis of each day of a continuing violation, with a single
notice and opportunity for hearing, provided that no such fine shall in
the aggregate exceed $1,000. No fine may become a lien against a unit.
Section 718.303(3), F.S.
10. Can the association charge me $100
to lease a unit?
A: This type of charge is generally referred to as a transfer fee. If an
association is required to approve of the transfer (sale, mortgage, lease,
etc.) of a unit then the association may charge a fee if such approval and
fee is provided for in the condominium documents. The maximum charge
allowable under the Condominium Act is $100 per applicant, and no charge
may be made on renewals with the same lessee or sublessee.
Section 718.112(2)(i), F.S.
11. What is the $4 fee that is
assessed by the Division for each condominium unit used for?
A: As provided in section
718.501(2)(b), F.S., these fees are deposited into the Division's trust
fund. The fees support a variety of functions. For example, the requests
for educational materials, including copies of the Condominium Act and the
corresponding administrative rules. Other educational materials mailed
upon request consist of brochures, information booklets, and pamphlets.
Fees also support the Bureau of Compliance's investigations of alleged
violations of the Condominium Act and staffing for the Bureau of Standards
and Registration's review of condominium disclosure documents. The
Division also offers a mandatory nonbinding arbitration program for unit
owners and associations. Fees also support the Department’s General
Counsel’s Office that provides legal services to the Division
Section 718.501(2)(b), F.S.
12. Where can I get a copy of
Chapter 718, Florida Statutes, the Condominium Act.
A: A copy of Chapter 718,
Florida Statutes, the Condominium Act, may be obtained by calling or
writing the Division’s Bureau of Customer Service. Copies are provided
free of charge.
Bureau of Customer Service
1940 North Monroe Street
Tallahassee, FL 32399-1032
Phone (850) 488-1122
Additionally, the Florida Legislature maintains copies of the Florida
Statutes on the Internet, including Chapter 718, the Condominium Act.
13. What is considered a
board meeting?
A: A board meeting is
defined in Rule 61B-23.001(1)(a), Florida Administrative Code, as any
gathering of the members of the board of directors at which a quorum of
the members is present, for the purpose of
conducting association business. Any situation that meets these
requirements would require board meeting notice to all unit owners. Any
such meeting shall be open to all unit owners.
Rule 61B-23.001(1)(a), F.A.C.
14. What is the difference
between a general proxy and a limited proxy, and when are they used?
A: A general proxy allows a
proxyholder to vote as he or she sees fit on any matters that may be
undertaken at a specific unit owner meeting. A limited proxy lists only
certain items that a proxyholder may cast a vote on behalf of an
association member, and also instructs the proxyholder on how to vote on
those items. The Condominium Act requires the use of limited proxies for
votes taken to waive or reduce reserves, votes taken to waive financial
statement requirements, amend the declaration, articles of incorporation
or bylaws, and for any other matter for which it requires or permits a
vote of the unit owners. A proxy form may grant a proxyholder both general
and limited powers. The Division maintains a Sample Limited Proxy Form,
known as BPR form 33-033.
Section 718.112(2)(b) 2., F.S. Rule
61B-23.002(3), F.A.C.
15. Are unit owners allowed to
attend and speak at meetings (board meetings, committee meetings, and
membership meetings)?
A: Yes. Unit owners have a
right to attend any and all meetings of the board, committees, and
membership meetings. Unit owners also have the right to speak with respect
to all designated agenda items. A board can adopt rules pertaining to the
frequency, duration, and manner of unit owner statements at meetings but
it cannot limit the total number of unit owners authorized to speak at any
meeting. For example, a board may limit a unit owner's maximum time to
three minutes or more. A board can also adopt a rule requiring a unit
owner desiring to speak to file a request with the association in advance
of the meeting. All rules adopted by the board regarding a unit owners'
ability to speak at a meeting must be adopted in written form and become a
part of the board rules, bylaws, or articles of incorporation.
Section 718.112(2)(c) &
(d), F.S., Rules 61B-23.002(7), F.A.C.
16. Is my association
required to hold regular meetings on a monthly basis?
A: The Condominium Act
requires every condominium association to hold an annual meeting and also
a meeting to adopt its annual budget. Both of these meetings may be held
on the same occasion, depending on provisions contained in the condominium
documents. Otherwise, there is no requirement for regular meetings of the
unit owners or the board of directors.
Section 718.112(2)(d), F.S.
17. How does an association
amend its bylaws?
A: Section 718.112(2)(h),
F.S., states that the method used to amend bylaws shall be included in the
bylaws and shall be consistent with the provisions of the Condominium Act.
Unless otherwise provided in the bylaws, a vote of at least two-thirds of
the voting interests is required to approve amendments. The full text of
the bylaws to be amended must be included with new words underlined and
words to be deleted stricken through with hyphens. If the change is too
extensive and would hinder, rather than assist, the understanding of the
proposed amendment, it is not necessary to use underlining and hyphens as
indicators of words added or deleted, but, instead, a notation must be
inserted immediately preceding the proposed amendment in substantially the
following language: "Substantial rewording of bylaw. See bylaw ___
for present text."
Section 718.112(2)(h), F.S.
18. When does an amendment
to the bylaws become effective?
A: Amendments to bylaws
become effective once they are recorded in the public records of the
county where the declaration of condominium is recorded.
Section 718.112(1)(b), F.S.
19. Where do the official
records of the association have to be maintained?
A: Section 718.111(12)(b),
Florida Statutes states:
The official records of the association shall be maintained within the
state. However, the association may comply by having a copy of the
official records of the association available for inspection or copying on
the condominium property or association property.
Section 718.111(12)(b), F.S.
20. How would a condominium go
about becoming an adult community (55 or older), and would all the
residents under 55 years old have to move out?
A: A property must meet
certain requirements to be designated as an adult community. The Florida
Commission on Human Relations addresses all questions pertaining to fair
housing in Florida. You may contact them at (850) 488-7082 [ask for
housing area], or 1-800-343-3442 (for copies of Federal Fair Housing Act).
21. Does an association
have to hire a licensed community association manager?
A: Chapter 718, Florida
Statutes, does not require the board of directors to hire a licensed
community association manager. Therefore, the association may be
self-managed. The board of directors is the entity responsible for
operating and managing the condominium association. The community
association managers licensing function is under the Division of
Professions. All questions regarding the licensure of community
association managers should be directed to the Division of Professions,
Community Association Managers Council at (850) 488-2141. To file a
complaint about a community association manager call (850) 488-6603 or
(850) 487-2252.
Rule 61B-23.001(6), F.A.C.
22. May the association pay
a board member for his or her services as a board member?
A: It depends. If the
bylaws of an association specifically provide for board members to be
compensated, then board members may be paid. Otherwise, the Condo Act
states that members of a board shall carry out their powers and duties
without compensation.
However, if compensated,
board members may be required to be licensed as community association
managers.
Section 718.112(2)(a) 1., F.S.
23. Who adopts the annual
budget, unit owners or the board of directors?
A: The Condominium Act sets
forth the minimum noticing requirements for a meeting to consider an
association's annual budget; however it does not specify who actually must
approve the annual budget. An annual budget is to be approved in
accordance with an association's bylaws. The bylaws may specify whether
unit owners must approve a proposed budget or whether the board alone may
approve the proposed budget.
Section 718.112(2)(e), F.S.
24. How are special assessments
approved?
A: Special assessments
shall be approved in accordance with an association's documents. The
Condominium Act sets forth-minimum noticing requirements for meetings to
consider nonemergency special assessments, but does not address the
responsibility for approving special assessments.
Section 718.116(10), F.S., Section
718.112(2)(c), F.S., Section 718.115(2), F.S.
25. How is the type of financial
statement an association is to prepare determined?
A: Section 718 111(13),
Florida Statutes, provides this information.
Section 718.111(13), F.S., Rule
61B-22.006, F.A.C.
26. What part of the condominium
property is the association required to maintain?
A: The association is
responsible for maintaining those portions of the condominium property not
included within the units. These are referred to as the common elements of
the condominium and are defined in the declaration of condominium.
Section 718.113(1), F.S.
27. I own a townhouse. How
can I tell if it's in a condominium?
A: A declaration of
condominium creates a condominium when the developer records it in the
public records of the county in which the condominium is located. If your
townhouse is not a condominium, there will be no declaration of
condominium recorded in the official records of the county.
Section 718.103(11) &
(13), F.S.
Section 718.104(2), F.S.
28. I thought that as a
unit owner and a member of my association I had the right to vote. Why is
it that most of the decisions of the association are made by the board of
directors?
A: The association has a
variety of powers and duties, which are described in the Condominium Act,
the condominium documents, and Chapters 607 and 617, Florida Statutes.
These powers and duties are carried out by the board of directors, as is
the case with any corporation, except in situations where the applicable
provisions of the Condominium Act or the condominium documents may provide
otherwise.
Section 718.111, F.S., Section 718.112(2)(a), F.S.
29. I am a
first-time condominium unit owner. How do I know where my association’s
money is going?
A: Every
association is required by the Condominium Act to prepare a financial
report or a complete set of financial statements following each fiscal
year. You are entitled to receive a copy of the report or the set of
statements. Also, the Condominium Act gives you the right to inspect the
association’s official records. By inspecting the records, you can
obtain information that is more specific than what you will find in the
year-end report or statements.
Section
718.111(12), (13) & (14), F.S.
Updated 05/01/02
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