Florida SB 596 creates a bona fide state HOA agency as necessary state oversight

As an alternate to making HOA governments a state entity, the creation and establishment of a bona fide, legitimate state agency established by an effective and meaningful enabling act will accomplish HOA reforms.  Couple the clear and precise intent to provide for checks and balances – meaning state oversight – with a dedicated head of the agency to carry out the agency’s mission, the independent HOA principalities will now be accountable to the state as they should be. 

Florida’s SB 596, sponsored by Senator Hays, proposes such a state agency over HOAs.  It proposes the following addition, among other things, to FS 720.302(2):

Having provided certain powers and authority to homeowners’ associations and in deed restrictions created by developers of mandated properties in residential communities, the Legislature recognizes that it is necessary to provide regulatory oversight of such associations in order to ensure compliance with federal and state laws and local ordinances. It is the intent of the Legislature to protect the rights of parcel owners by ensuring that the powers and authority granted to homeowners’ associations and in deed restrictions created by developers of mandated properties in residential communities conform to a system of checks and balances in order to prevent abuses by these governing authorities. (emphasis added).

From first glance, this bill creates a typical regulatory agency to make laws, set rules, investigate, handle complaints and enforce the law in courts. Among the provisions in this lengthy 124 page bill are penalties, fines, HOA cease and desist orders, and restitution enforceable in the courts by the agency, FBPR, and not having to be brought by the individual homeowner.  The proposed agency is not a “let’s study the problem” typical political tactic to do nothing by creating just an investigatory agency, which insults homeowners with its “we don’t believe you” attitude.    SB 596 is a very good step short of making HOAs state agencies.

It should be obvious to all that what will be argued as government involvement has been brought about precisely because of the abuse within the industry.  It is the failure of those “stakeholder,” specil interest moneyed vendors to police the industry.  It is the failure of the homeowners themselves to police their boards. And consequently, it falls to state governments to promote the general welfare and protect its citizens against abuse by a stronger faction within the community.

Furthermore, making this bill law will help keep the legislature from hearing HOA reform bills year after year.

In order to establish justice and fair play for all homeowners, it remains to insure that the laws are themselves fair and just. The pro-HOA laws must be amended or revoked.  The misguided doctrine that permits CC&Rs and servitude law to supersede constitutional law and contract law must stop

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Published in: on March 17, 2013 at 8:19 am  Comments (15)  
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  1. The sole purpose of HOA’ and CC&R’s set up by builders is for them to control your property after a sale.The builder wants to maintain uniformity to keep the community “looking new and uniform” through the build out process to make the final piece of property sold easy as possible.

    • Florida SB 596 died in May 2013. Check it out.

      • Yes, but it doesn’t make it a bad bill, just a bad decision by the legislature.

  2. I have policed by board for years and have gotten verbally abused and “beaten up” by board members. They make the changes, as they’re forced to eventually through mediation and/or ensuing court action or their attorney finally telling them to act, but a few of us are labeled now. What a way to live in a community? Thank God I rent now…
    I can’t wait for an agency to go to with legitimate complaints of violations against the law — a fine or two against my board will wake them up!

  3. The perfidy of the local State Attorney, the DBPR, the Attorney General (Bondi) and the governor himself in these matters is that even when provided documentation beyond reproach of these abuses by rogue developers, boards, their attorneys who conspire to file illegal liens upon our properties (developers are NOT parties of interest, only an elected Board may file liens for nonpayment of fees) then pile late fees, interest and attorney’s fees on top, they refuse to appoint a grand jury to investigate these widespread abuses and then prosecute the crimes they find evidence of. Without recourse to the state’s pursuit of these thieves–the perpetrators know they are safe to steal millions of dollars from enslaved seniors, year after year, as has happened in my community in S.W. Ocala. The rogue individual who controls our community has had the gaul to start buying up abandoned homes for pennies on the dollar and renting them out (many owners have walked away because they can’t afford the $200 confiscatory fees he pockets 90% of for his own enrichment!). And all with the blessings of DPBR and the State of Florida!

  4. […] post is in response to several comments to Florida SB 596 creates a bona fide state HOA agency as necessary state oversight.   I read the 124 page bill and some general comments are in […]

    • As George Washington said: “The due administration of justice is the firmest pillar of good government”.
      What we have in Florida is poor administration of justice for the homeowner’s, mostly seniors. This is in favor of the developers. It is at the point where crimes are not prosecuted, developers charge whatever they like for fees, communities are sold between developers with the homeowners paying the developer’s mortgage, homeowners are outvoted in perpetuity by the developer, the association is a cash cow for the developer and the homeowner becomes a “financial slave” to these parasites. Just in one county thousands of homeowners are affected. Unbelievable, isn’t it ? Well, it’s true. And that’s just a rough picture.
      The Bill in question was set up by a certain few folks without input from other interested parties to enable the association to have more financial power and to fix the already extremely poor Ch 720, HOA statute. It will not apply to all HOAs and there are so many loopholes it will be, without question, totally ineffective. The section specifically regarding Ch 720 is pages 4 through 38. This entire section is grossly flawed and must be stricken from the bill. The remaining portions of the bill that pertain to HOA communities are not in the interest of the homeowner and will only reduce the rights of the homeowner, increase the time and costs to resolve issues and otherwise exacerbate an already despicable situation. As a Florida resident, victim of a crooked developer, crooked association and lack of prosecution, this bill is not a fix but an abomination. I suppose that when one lives through the crimes and suffers severe financial losses, one sees a different picture than when one is merely pontificating.
      Thanks for your interest in Florida and our legislative efforts.

  5. The Florida SB 596 is a Bad Bill designed to fix the existing defective FL Ch 720 HOA statute. The bill will increase the size and complexity of the Department of Business and Professional Regulation that has proven itself to be impotent while mostly senior home owners suffer with illegally operated HOAs, crooked developers and felony crimes. How can crimes be mediated, arbitrated or omnusbudsmanated by the DBPR ? Crimes must be prosecuted. Currently, prosecution is not happening as the offenses are called “civil” by the prosecutors. Florida needs the Attorney General to appoint a Special State Wide Prosecutor and Special State Wide Grand Jury immediately. Just a few gross errors in the bill: It will allow any non-member person including a felon to be a director but a homeowner must be paid up with fees and not be a felon. It will allow the developer to outvote the other HOA members in perpetuity with any number of votes per lot he wants while the members have only one measly vote each. It will allow the developer to control lots indefinitely by just not selling some to block the transition of the association from developer control to member control. I know, I’m a victim of the unlicensed contractor (licensing by the DBPR) who is also the developer and the controller of the illegally operated HOA (under DBPR Ch 720). In this community, the bank used by the unlicensed contractor/develper for mortgages has been shut down by the Federal OCC, the unlicensed contractor/developer’s attorney has been disbarred for other fraud and the hired licensed (licensed by the DBPR) association manager had his real estate broker license revoked by the DBPR for fraud. The DBPR didn’t revoke the manager license. The DBPR has proven itself to be incompetent. Nothing at all has happened to these parasites regarding the illegal custom home construction, the illegal HOA operation and the felonies committed. This bill will not fix anything but will only provide the parasites with more ways to continue to financially harm the senior citizen homeowners in Florida. The bill must be discarded and replaced by substantial and honest content to protect the homeowners in every HOA, not just a few HOAs. Get educated, read FL Ch 720, read SB 596.
    Don, Ocala

  6. You are welcome, George. I don’t think Hays will listen, since he is already wedded to this bill, but as I said before, I am certainly voicing my opinion on it. In short, it is a terrible bill. It deserves to be deep sixed, and someone should draft a bill that, for starters, knows how to write legislation, and secondly, is able to narrow the issues to the top priority. Regulation of HOAs would be a good start, even on a limited basis, but more than there is now. When it comes to legislation, incremental is usually better, because there are fewer disasters in the making. And this one is a doozy.

    Last year, the attorney who drafted it just wholesale copied landlord tenant law into the HOA statute, and created talking points that said “the language is already in the statutes, so it is valid language.” Sure, for a different property interest. He so blindly cut and paste that he missed the teeny point that it would have allowed associations to take possession of a person’s home before a judgment. When I raised hell about that, it mysteriously disappeared, but the rest of the horror remained. This year they hired a high powered lobbyiest to push it. It is as bad or worse than last year’s attempt.

    This bill should run into resistance. I believe that legislators who can read will object. I urge all homeowner advocates to take a good hard look at this bill before endorsing it, because the talking points sound good, or because it came out of an alleged consumer advocacy group (which at one time was, but no longer appears to be).

  7. At the very least, municipalities should be required and require developers to build a certain percentage of developments without HOAs. I personally would never buy into an HOA again. Should people have the option? Yes, I think so. However, that means that there needs to be reasonable housing in non-HOA communities, and that is becoming scarce.

    I am most certainly voicing my opinion about the Hays bill. I just ask that people read it before buying into the talking points which are very deceptive. Even a few years ago, I could never have seen Jan B supporting such a bill. That is why I am no longer a member of CCFJ.

    • Jean, your sentiments seem to echo that of Donna Berger’s views — too big a bill, go slowly, and draft it right. Aside from these general opinions, you mention the need to examine the bill more closely. That I will do and I will report my views here.

      I admit that I am not an attorney nor am I close to the scene in Florida. My concerns go beyond Florida to constitutional issues. The overriding impact with this bill is to hold HOAs accountable to state governments with effective penalties to serve as a detriment to future such actions. This alone would put an end to the abuse by rogue boards. Now, they are treated as independent principalities, which can explain why so many people like them — no penalties!

  8. How do you explain the Hays bill provision that would prevent homeowners from asserting legitimate defenses without ponying up whatever the Association demands they owe to which the HOA has access by claiming “hardship”? Do you think that is homeowner friendly? I can think of a couple of absolute defenses that a homeowner would not be allowed to assert without fronting all the money the HOA demands – whether legal or not. Unless he can come up with that money (including padded attorneys fees), he would be forever barred from asserting those (legitimate) defenses. It is a denial of procedural due process, does not help associations since assessment foreclosure has never been the problem (it is the bank delays), it does not minimize court administrative resources and sure as heck does not help homeowners – still paying or not. It is a minefield for litigation increasing billable hours for attorneys.

    I agree that HOAs should be regulated. But without reading the entire bill and understanding what it says, promoting it is dangerous. This is NOT a consumer friendy bill. It is anything but homeowner friendly. In fact, it was “drafted” by an association attorney who touted it as being “homeowner friendly.”

    The other constitutional issue in Florida is impairment of contract. The proposed changes to Florida’s “Safe harbor” for banks from 1% to 2% would not have a significant impact, because banks are already claiming they don’t owe anything regardless of when the mortgage was executed – using a case that I believe can be distinguished. Regardless, there are better and constitutionally sound ways to get banks to pay, that have been proposed, but not in this bill.

    Finally, why is there such black and white thinking? Why don’t people read the bills and decide on their merits for what they are, rather than who proposed them? I have to say I am stunned that some whom I had long thought were reasonably minded and pro-homeowner have made an about face in demanding that homeowners be screwed, calling them “deadbeats”. Some non-paying homeowners have a legitimate reason to not pay. In Florida, the Marketable Record Title Act is an absolute defense – the covenants are expired and the homeowner is not subject to them. Another absolute defense that the homeowner would be barred from raising (unless he pays whatever the association demands) would be improper levying of assessments. I can think of a few more. In short, there is more than just one defense (payment of an assessment that is defined as an assessment in the Dec). Why would you tell homeowners they could not assert their defenses unless they can come up with all the association claims they owe – whether legal or not? How does this help associations, when the real problem is the delay of mortgage foreclosures, and the HOA being the intervening owner before a bank forecloses – a recent Florida case said the bank (or investor) didn’t have to pay anything under those circumstances. That could be changed, and should be, by statute. Doing so would be an easy fix, and would not raise constitutional challenges.

    For years, I have said HOAs in Florida should be more regulated and boards held accountable. But this is not the way to do it – it is extending a carrot with one hand and extending a sucker punch with the other.

    • Thanks for your input.

      A bill this size will not please all people, and will have some good and some not so good. That’s life. Have you voiced your concerns to Senator Hays? Point them out and provide legitimate resons why you object, reasons that he can use against the special interests and objecting legislators. And there are valid reasons to object to what is blatantly designed for the survival of the HOA and against the just and fair treatment of homeowners — it’s a special law for special organizations.

      Also, is the baby step better than no step at all? Homenowners must decide. My guess is that this bill will run into stiff oppostion and the sponsor, who’s heart is in the right direction, will need all the support from the people he can get.

      NOTHING WILL CHANGE WITHOUT CHANGE! And that change can only come from the legislature and individual legislative champions.

  9. maybe a baby step, but is another level of government the answer? what about getting rid of hoa’s altogether like in the old days? we didn’t need them then!

  10. Truer words were never written.
    It should be obvious to all that what will be argued as government involvement has been brought about precisely because of the abuse within the industry. It is the failure of those “stakeholder,” special interest moneyed vendors to police the industry.

    Thus it was with meat packing, air travel, and seat belts. But is this issue not more like integration of the schools, and the right to vote?


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