John Hawley
Jul 9, 2024
A St. Petersburg HOA board resigned after proposing a $60,000 special assessment due to a misunderstanding of the "Surfside Bill." The incident highlights the importance of proper planning, communication, and understanding of HOA regulations.
Florida HOA Board Resigns After $60,000 Special Assessment Misunderstanding
A homeowners association (HOA) board in Saint Petersburg, Florida, recently resigned following a controversy surrounding a proposed special assessment. The Villas of Carillon HOA, established in 2004 and governing 165 townhomes, proposed a significant special assessment of $60,000 for each member. This sparked outrage among residents who questioned the necessity and hefty price tag.
Misunderstanding Fuels Controversy
The core of the issue stemmed from a misunderstanding of a recent Florida law, SB 4-D, also known as "The Surfside Bill." The board believed this law mandated fully funding their reserve accounts to cover upcoming repairs. This led them to propose the special assessment for roof, garage, drainage, and other projects. However, the law, enacted after the tragic 2021 Surfside condo collapse, only applies to buildings three stories or higher. The Villas of Carillon's two-story townhomes are exempt. Additionally, "fully funded" doesn't require having the entire project cost upfront.Reserve studies typically outline a plan for funding future repairs through regular contributions.
Lessons Learned: Avoiding Similar Situations
This misinterpretation ultimately led to the HOA board's resignation. The incident highlights crucial takeaways for all HOA/COA boards regarding special assessments:
Planning is Key:Â Reserve studies are essential for determining the appropriate funding needed over time for future repairs and replacements.
Understanding Requirements:Â Associations don't need full upfront funding, but they do need to meet annual reserve requirements outlined in the reserve study.
Communication is Crucial:Â Clear communication with homeowners is key. Explain the reasons for special assessments, how the numbers were determined, and provide opportunities for questions and understanding.
Explore Options:Â Before proposing large special assessments, explore cost-saving options like alternative materials or flexible payment plans.
Additional Considerations for Informed Decisions
Stay Informed About Regulations:Â Stay updated on state regulations related to reserve studies and special assessments, considering the type of association and building height.
Seek Legal Counsel:Â Consult legal counsel to ensure compliance with all applicable laws and regulations.
By following these steps, HOA/COA boards can make informed decisions about special assessments, fostering better resident relationships and avoiding similar situations in the future.
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