THE BOSS (Boards & Owners For SucceSS)
CONDO FAQ's

Yes, plumbing and electrical systems are both explicitly included in the list of items that must be addressed in a Structural Integrity Reserve Study (SIRS). 💧⚡

Under Florida Statute 718.112(2)(g), the study must account for the replacement or substantial deferred maintenance of these systems. The goal is to ensure that the association is putting enough money aside now so that when these massive systems eventually fail, the funds are already in the bank.

Why They Are Included

While things like “painting” might seem aesthetic, plumbing and electrical are considered critical safety components.

• Plumbing: This includes the main lines and risers that serve the entire building. A failure here can lead to catastrophic water damage or mold across multiple units. 🏗️

• Electrical: This focuses on the primary electrical systems that power the building’s common areas and life-safety systems (like fire alarms or emergency lighting). 💡

Because these are on the “SIRS list,” the board cannot allow owners to vote to waive or reduce the reserves for them. They must be funded based on the engineer’s findings.

The short answer is no. Even if the board is failing to repair the roof, ignoring the pool maintenance, or mismanaging funds, a unit owner generally cannot withhold assessment payments as a form of protest.

Only through the substitute budget process or by electing new board members.

In Florida, the use of reserve funds is strictly governed to ensure that money set aside for long-term maintenance isn’t “borrowed” for daily expenses. 🛡️

According to Florida Statute 718.112(2)(f), reserve funds and any interest they earn must remain in the reserve account and be used only for the purposes for which they were reserved. For example, money in a “Roof Reserve” cannot be used to pay the association’s electricity bill or legal fees.

However, there is a “legal escape hatch” that allows an association to use these funds for a different purpose if specific conditions are met:

The Voting Requirement 🗳️

A board cannot decide on its own to move reserve money. To use reserve funds for a purpose other than their intended one, the association must obtain approval from a majority of the total voting interests at a duly called meeting of the association.

The “SIRS” Restriction 🚫

As we discussed earlier, the new laws have added a massive caveat to this rule. For budgets adopted after December 31, 2024, owners cannot vote to use reserve funds for other purposes if those funds are designated for Structural Integrity Reserve Study (SIRS) items (like the roof, load-bearing walls, or fire protection).

Essentially, the law now treats safety-related money as “untouchable” for any other use, regardless of how the owners vote.

Yes. Late fees cannot exceed $25 or 5% of the assessment, whichever is greater, and only if your specific bylaws allow for it.

Yes, they can. Late fees and interest must be authorized in the bylaws or declaration and must be within limits
a. Maximum interest is 18%
b. Maximum late fee is greater of $25 or 5% of installment
6. Payments are applied as follows
a. Interest
b. Late fee
c. Collection cost
d. Past due assessment

Last but not least, what’s left is applied to your current month’s balance. If you don’t include the amounts from a. through d. to your payment, you’ll be behind all over again next month!

In Florida, the board’s authority to levy special assessments is governed by Chapter 718 of the Florida Statutes (The Condominium Act). While the board generally has the power to assess owners for common expenses, Florida law imposes strict “transparency and notice” conditions to protect unit owners from surprise charges. 🏖️

Under Florida law, a board can typically levy a special assessment on its own initiative, but they must clear several specific legal hurdles for it to be valid.

Core Statutory Conditions

• The 14-Day Notice Rule: Per FS 718.112, the board must provide written notice to every unit owner at least 14 days before the meeting where a special assessment will be considered. This notice must also be posted conspicuously on the property. 📅

• Specific Purpose & Cost: It must include a description of the purpose (e.g., “Roof Replacement”) and an estimated cost. If the board is approving a specific contract for the work, that contract must be made available for owners to review. 🔍

• Proportional Allocation: Assessments must be shared among owners according to their percentage of ownership in the common elements, as defined in your Declaration of Condominium (FS 718.115).

• The “Paper Trail”: After the notice is sent, the association must file an affidavit in their official records proving that the notice was properly delivered to all owners. 📝

The board cannot reduce the assessment amount for a condo owner. They can, however,  negotiate late fees, collection fees, or interest.  I would not recommend it. If you do, you could be setting a precedent that could be seen as discriminatory (disparate impact), i.e. my friend doesn’t have to pay but another person does. You definitely don’t want to go down that road. The association is a business, so it has to pay bills just like an owner does. If a unit owner calls the power company and says, “I can’t pay this month because I lost my job,” do you think they’ll forgive the debt? The same applies to the association. I follow the rule: “Set no precedents, make no exceptions. Talk to the hand!”  You stay out of trouble that way.

!

It’s common for a budget to have many line items, but Florida law treats Special Assessments as a completely different bucket of money than your Annual Operating Budget.

The core statute that prevents the board from mixing these funds is Florida Statute 718.116(10).

The “Single Purpose” Rule 🎯

Even if your annual budget has 50 different line items for things like “Pool Chemicals” or “Legal Fees,” a special assessment is legally bound to the one specific reason it was created.

• Restricted Use: Per FS 718.116(10), funds collected through a special assessment “shall be used only for the specific purpose or purposes set forth in [the] notice.”

• The Firewall: The board cannot treat special assessment money as a backup fund for when another line item in the regular budget runs short. For example, if they assess for “Elevator Modernization,” they cannot use that cash to cover a surprise increase in the “Insurance” line item of the regular budget. 🛡️

At least 10% of all voting interests within 21 days of the board’s budget adoption.

The statute says assessments must be paid at least quarterly.

Reserves are calculated using a separate (single asset)  analysis taking into account each asset’s:
a. Total estimated useful life
b. Estimated remaining life
c. Estimated cost to replace
d. Current balance in the fund

The biggest danger of not passing a new budget in today’s Florida legal climate involves reserves. Recent laws (like those surrounding Structural Integrity Reserve Studies or SIRS) mandate that certain safety-related reserves must be funded. A board that fails to adopt a budget may be effectively “skipping” these mandatory contributions, which can lead to personal liability for directors or legal action from owners.

It depends primarily on the association’s total annual revenue. 📊

Under Florida Statute 718.111(13), associations are required to prepare different levels of financial reports based on their size and income. I’ll guide you through the specific thresholds and requirements.

Associations with total annual revenues of less than $150,000 are generally only required to prepare a report of cash receipts and expenditures, which does not necessarily require a CPA.

The Financial Reporting Hierarchy

The law creates a “ladder” of financial reporting. As an association’s revenue increases, the level of scrutiny required from a CPA becomes more intense.

Special assessments may be charged for unforeseen expenses
a. Requires approval by majority at a meeting
b. Used only for the special purpose
c. Excess funds are common surplus

If regular or special assessment payments are in default, the board has the power to bring an action to recover a money judgment without waiving their right to file a lien. If they choose to file a lien it may be foreclosed in the same manner as a mortgage. There are strict notice requirements in order to record and foreclose a lien for assessments.
1. Association may accelerate, file and foreclose on defaulted assessment payments, interest and collection costs
This does not apply to late fees.
2. Lien must be recorded by the Clerk of Circuit Court in the county where the property is located.
3. Advance notice by first class and/or certified mail is required prior to recording the lien AND prior to foreclosing
a. Homeowners’ association – 45 days
b. Condominiums and cooperatives – 30 days
4. The lien becomes ineffective one year from the date it’s recorded unless foreclosed in a timely manner.

“Common surplus” is the term for all funds remaining at the end of the fiscal year after all expenses have been paid. Common surplus is owned by unit owners in the same shares as their ownership interest in the common elements.
1. Condominiums and cooperatives must do one of the following with common surplus:
a. Return to owners
b. Reduce assessments
c. Apply to reserves

Reconsideration of a Budget Adopted by the Board
The membership has the right to petition the board for reconsideration of a board adopted budget.
1. Owners may petition for reconsideration if the budget calls for new assessments for operating expenses (not reserves) in excess of (115%) of
the previous year
2. (10%) of the voting interest must petition within 21 days after adoption
3. Special meeting of the unit owners must be held within (60 days) of adoption
a. 14 day notice
b. A quorum is required
4. Unit owners may adopt a substitute budget at the special meeting. Requires approval of majority of all voting interests.
5. If no quorum or substitute budget is approved, the board-adopted budget takes effect as scheduled

The association will prepare an annual budget that must reflect the estimated revenues, expenses, and reserves schedule for the next fiscal year and the estimated surplus or deficit as of the end of the current fiscal year. Every member must have access to the final budget.
1. Condominiums and cooperatives are required to distribute the budget and it must include each of the following items:
a. Estimated common expenses for taxes, insurance, maintenance, utilities, administration, management and reserves
b. $4 per unit fees payable to the DBPR
c. Total assessment due for each unit according to ownership share
d. Separate schedule of expenses if owners of limited common elements pay for maintenance
e. Reserve schedule

The minutes must reflect adoption of the budget 3. Copies of the proposed and adopted budgets are part of association records
4. Multi-condominium associations must prepare a separate budget for each condominium plus one for the overall association

(4 condominiums = 5 budgets)

Florida law is quite strict about the timeline. Per the statutes:

• 14-Day Deadline: The budget must be adopted at least 14 days before the start of the fiscal year (usually by December 18th for associations on a calendar year).

• Minor vs. Major Violations:

  • Failing to adopt the budget on time is considered a major violation of the Condominium Act. 🚩

  • The Division of Florida Condominiums can levy civil penalties against the association, ranging from $500 to $5,000.

  • If it happens a second time, it is flagged as a recurring violation, which can lead to even stricter oversight or higher fines.

If an owner stops paying, the association has powerful statutory tools to collect:

• Late Fees and Interest: These begin accruing immediately. 📈

• Legal Fees: The association can pass the cost of their attorney’s collection efforts directly to the owner.

• Claim of Lien: Under FS 718.116, the association can place a lien on the unit.

• Foreclosure: If the debt isn’t paid, the association can actually foreclose on the unit to recover the money, regardless of whether the board was “doing its job” or not. 🏠🔨

In a normal annual budget, the board often has some flexibility to move money between operating line items (like using leftover “Landscaping” money to cover extra “Security” costs). However, Special Assessment funds are not flexible.

If a project is finished and there is money left over, the board only has two legal paths under the same statute:

1. Refund the extra to the owners. 💸

2. Credit the extra toward future assessments (reducing your next bill).

Under Florida Statute 718.112, the law provides a safety net to keep the lights on, while also setting up penalties for the board’s failure to act.

1. The “Prior Year” Default Rule

If the board misses the deadline to adopt a new budget, Florida law dictates that the prior year’s budget continues in effect until a new one is officially adopted.

• Payment Stays the Same: Unit owners typically continue paying the same monthly assessment amount they paid the previous year.

• The Risk: If costs (like insurance or utilities ⚡) have gone up, but the assessment stays at last year’s lower rate, the association will quickly run a deficit. This often forces the board to pass a special assessment later to bridge the gap—which has its own strict notice and use rules.

A budget proposed by owners that excludes discretionary spending.

Reserves, insurance premiums, and non-recurring maintenance/repair of structural items.

THE ASSOCIATION BUDGET is the financial roadmap outlining the estimated expenses for operation of the association and maintenance of the common property, the money needed to fund reserves for replacement, and the basic services to be provided. It is prepared annually for a 12-month period. Once adopted, the budget is the basis for assessments charged to each member.

Yes, you must follow the requirements of the state when establishing a budget. The unit owner’s share of the money required to pay the expenses of the association is determined by the budget. Here’s a quick overview of the budget steps:
– Estimate expenses: recurring charges.
– Estimate reserve requirements: non-recurring capital expenditures.
– Estimate revenues: user fees, rental fees, and assessments needed to fund expenses and reserves.

Operating expenses are the regular recurring expenses of the association, including:
– taxes – insurance – maintenance – utilities – administration and management.

Examine last year’s budget and identify items where money will be spent. For each item, match the account, line item, and classification to the corresponding category.
Also review contracts for services that are considered common expenses, such as:
– Franchised cable TV maintenance contracts
– Water, sewer, and garbage removal

we must also estimate reserve requirements, such as:
– roof replacement
– building painting
– pavement resurfacing
– and any non-operating expense over $10,000
NOTE: Contingency reserves must be operating expenses, not reserves.

1. The documents will specify who will adopt the budget
a. The board, or
b. The membership
2. Budget meeting notice requirements
a. 14 day notice
b. Include copy of the proposed budget, reserve accounts and calculations
3. Proposed budget may be amended prior to adoption.

To be valid, claim of lien must state:
a. Legal description
b. Name of owner
c. Name + address of association
d. Amount due
e. Due dates
f. It must be executed by an officer of the board

If a unit owner or member is more than 90 days delinquent in paying a fee, fine, or other monetary obligation due to the association, the  association may:
1. Suspend the right to use common elements
2. Suspend the voting rights
3. Demand that a tenant pay rent directly to the association
4. Record and enforce a lien against the property

While the statute gives boards broad power, your association’s Bylaws or Declaration may limit that power. For example:

• Spending Caps: Many older Florida documents state the board can only assess up to a certain dollar amount without a majority vote of the owners.

• Material Alterations: If the assessment is for an “improvement” that significantly changes the look or function of the property (like turning a tennis court into a pickleball court 🎾), FS 718.113 usually requires a vote from the membership.

It must be proposed and adopted at least 14

days before the fiscal year begins.

The short answer is no. Even if the board is failing to repair the roof, ignoring the pool maintenance, or mismanaging funds, a unit owner generally cannot withhold assessment payments as a form of protest.

Only through the substitute budget process or by electing new board members.

Yes. Late fees cannot exceed $25 or 5% of the assessment, whichever is greater, and only if your specific bylaws allow for it.

Yes, they can. Late fees and interest must be authorized in the bylaws or declaration and must be within limits
a. Maximum interest is 18%
b. Maximum late fee is greater of $25 or 5% of installment
6. Payments are applied as follows
a. Interest
b. Late fee
c. Collection cost
d. Past due assessment

Last but not least, what’s left is applied to your current month’s balance. If you don’t include the amounts from a. through d. to your payment, you’ll be behind all over again next month!

In Florida, the board’s authority to levy special assessments is governed by Chapter 718 of the Florida Statutes (The Condominium Act). While the board generally has the power to assess owners for common expenses, Florida law imposes strict “transparency and notice” conditions to protect unit owners from surprise charges. 🏖️

Under Florida law, a board can typically levy a special assessment on its own initiative, but they must clear several specific legal hurdles for it to be valid.

Core Statutory Conditions

• The 14-Day Notice Rule: Per FS 718.112, the board must provide written notice to every unit owner at least 14 days before the meeting where a special assessment will be considered. This notice must also be posted conspicuously on the property. 📅

• Specific Purpose & Cost: It must include a description of the purpose (e.g., “Roof Replacement”) and an estimated cost. If the board is approving a specific contract for the work, that contract must be made available for owners to review. 🔍

• Proportional Allocation: Assessments must be shared among owners according to their percentage of ownership in the common elements, as defined in your Declaration of Condominium (FS 718.115).

• The “Paper Trail”: After the notice is sent, the association must file an affidavit in their official records proving that the notice was properly delivered to all owners. 📝

The board cannot reduce the assessment amount for a condo owner. They can, however,  negotiate late fees, collection fees, or interest.  I would not recommend it. If you do, you could be setting a precedent that could be seen as discriminatory (disparate impact), i.e. my friend doesn’t have to pay but another person does. You definitely don’t want to go down that road. The association is a business, so it has to pay bills just like an owner does. If a unit owner calls the power company and says, “I can’t pay this month because I lost my job,” do you think they’ll forgive the debt? The same applies to the association. I follow the rule: “Set no precedents, make no exceptions. Talk to the hand!”  You stay out of trouble that way.

!

It’s common for a budget to have many line items, but Florida law treats Special Assessments as a completely different bucket of money than your Annual Operating Budget.

The core statute that prevents the board from mixing these funds is Florida Statute 718.116(10).

The “Single Purpose” Rule 🎯

Even if your annual budget has 50 different line items for things like “Pool Chemicals” or “Legal Fees,” a special assessment is legally bound to the one specific reason it was created.

• Restricted Use: Per FS 718.116(10), funds collected through a special assessment “shall be used only for the specific purpose or purposes set forth in [the] notice.”

• The Firewall: The board cannot treat special assessment money as a backup fund for when another line item in the regular budget runs short. For example, if they assess for “Elevator Modernization,” they cannot use that cash to cover a surprise increase in the “Insurance” line item of the regular budget. 🛡️

At least 10% of all voting interests within 21 days of the board’s budget adoption.

The statute says assessments must be paid at least quarterly.

Reserves are calculated using a separate (single asset)  analysis taking into account each asset’s:
a. Total estimated useful life
b. Estimated remaining life
c. Estimated cost to replace
d. Current balance in the fund

The biggest danger of not passing a new budget in today’s Florida legal climate involves reserves. Recent laws (like those surrounding Structural Integrity Reserve Studies or SIRS) mandate that certain safety-related reserves must be funded. A board that fails to adopt a budget may be effectively “skipping” these mandatory contributions, which can lead to personal liability for directors or legal action from owners.

It depends primarily on the association’s total annual revenue. 📊

Under Florida Statute 718.111(13), associations are required to prepare different levels of financial reports based on their size and income. I’ll guide you through the specific thresholds and requirements.

Associations with total annual revenues of less than $150,000 are generally only required to prepare a report of cash receipts and expenditures, which does not necessarily require a CPA.

The Financial Reporting Hierarchy

The law creates a “ladder” of financial reporting. As an association’s revenue increases, the level of scrutiny required from a CPA becomes more intense.

Special assessments may be charged for unforeseen expenses
a. Requires approval by majority at a meeting
b. Used only for the special purpose
c. Excess funds are common surplus

If regular or special assessment payments are in default, the board has the power to bring an action to recover a money judgment without waiving their right to file a lien. If they choose to file a lien it may be foreclosed in the same manner as a mortgage. There are strict notice requirements in order to record and foreclose a lien for assessments.
1. Association may accelerate, file and foreclose on defaulted assessment payments, interest and collection costs
This does not apply to late fees.
2. Lien must be recorded by the Clerk of Circuit Court in the county where the property is located.
3. Advance notice by first class and/or certified mail is required prior to recording the lien AND prior to foreclosing
a. Homeowners’ association – 45 days
b. Condominiums and cooperatives – 30 days
4. The lien becomes ineffective one year from the date it’s recorded unless foreclosed in a timely manner.

“Common surplus” is the term for all funds remaining at the end of the fiscal year after all expenses have been paid. Common surplus is owned by unit owners in the same shares as their ownership interest in the common elements.
1. Condominiums and cooperatives must do one of the following with common surplus:
a. Return to owners
b. Reduce assessments
c. Apply to reserves

Reconsideration of a Budget Adopted by the Board
The membership has the right to petition the board for reconsideration of a board adopted budget.
1. Owners may petition for reconsideration if the budget calls for new assessments for operating expenses (not reserves) in excess of (115%) of
the previous year
2. (10%) of the voting interest must petition within 21 days after adoption
3. Special meeting of the unit owners must be held within (60 days) of adoption
a. 14 day notice
b. A quorum is required
4. Unit owners may adopt a substitute budget at the special meeting. Requires approval of majority of all voting interests.
5. If no quorum or substitute budget is approved, the board-adopted budget takes effect as scheduled

The association will prepare an annual budget that must reflect the estimated revenues, expenses, and reserves schedule for the next fiscal year and the estimated surplus or deficit as of the end of the current fiscal year. Every member must have access to the final budget.
1. Condominiums and cooperatives are required to distribute the budget and it must include each of the following items:
a. Estimated common expenses for taxes, insurance, maintenance, utilities, administration, management and reserves
b. $4 per unit fees payable to the DBPR
c. Total assessment due for each unit according to ownership share
d. Separate schedule of expenses if owners of limited common elements pay for maintenance
e. Reserve schedule

The minutes must reflect adoption of the budget 3. Copies of the proposed and adopted budgets are part of association records
4. Multi-condominium associations must prepare a separate budget for each condominium plus one for the overall association

(4 condominiums = 5 budgets)

Florida law is quite strict about the timeline. Per the statutes:

• 14-Day Deadline: The budget must be adopted at least 14 days before the start of the fiscal year (usually by December 18th for associations on a calendar year).

• Minor vs. Major Violations:

  • Failing to adopt the budget on time is considered a major violation of the Condominium Act. 🚩

  • The Division of Florida Condominiums can levy civil penalties against the association, ranging from $500 to $5,000.

  • If it happens a second time, it is flagged as a recurring violation, which can lead to even stricter oversight or higher fines.

If an owner stops paying, the association has powerful statutory tools to collect:

• Late Fees and Interest: These begin accruing immediately. 📈

• Legal Fees: The association can pass the cost of their attorney’s collection efforts directly to the owner.

• Claim of Lien: Under FS 718.116, the association can place a lien on the unit.

• Foreclosure: If the debt isn’t paid, the association can actually foreclose on the unit to recover the money, regardless of whether the board was “doing its job” or not. 🏠🔨

In a normal annual budget, the board often has some flexibility to move money between operating line items (like using leftover “Landscaping” money to cover extra “Security” costs). However, Special Assessment funds are not flexible.

If a project is finished and there is money left over, the board only has two legal paths under the same statute:

1. Refund the extra to the owners. 💸

2. Credit the extra toward future assessments (reducing your next bill).

Under Florida Statute 718.112, the law provides a safety net to keep the lights on, while also setting up penalties for the board’s failure to act.

1. The “Prior Year” Default Rule

If the board misses the deadline to adopt a new budget, Florida law dictates that the prior year’s budget continues in effect until a new one is officially adopted.

• Payment Stays the Same: Unit owners typically continue paying the same monthly assessment amount they paid the previous year.

• The Risk: If costs (like insurance or utilities ⚡) have gone up, but the assessment stays at last year’s lower rate, the association will quickly run a deficit. This often forces the board to pass a special assessment later to bridge the gap—which has its own strict notice and use rules.

A budget proposed by owners that excludes discretionary spending.

Reserves, insurance premiums, and non-recurring maintenance/repair of structural items.

THE ASSOCIATION BUDGET is the financial roadmap outlining the estimated expenses for operation of the association and maintenance of the common property, the money needed to fund reserves for replacement, and the basic services to be provided. It is prepared annually for a 12-month period. Once adopted, the budget is the basis for assessments charged to each member.

Yes, you must follow the requirements of the state when establishing a budget. The unit owner’s share of the money required to pay the expenses of the association is determined by the budget. Here’s a quick overview of the budget steps:
– Estimate expenses: recurring charges.
– Estimate reserve requirements: non-recurring capital expenditures.
– Estimate revenues: user fees, rental fees, and assessments needed to fund expenses and reserves.

Operating expenses are the regular recurring expenses of the association, including:
– taxes – insurance – maintenance – utilities – administration and management.

Examine last year’s budget and identify items where money will be spent. For each item, match the account, line item, and classification to the corresponding category.
Also review contracts for services that are considered common expenses, such as:
– Franchised cable TV maintenance contracts
– Water, sewer, and garbage removal

we must also estimate reserve requirements, such as:
– roof replacement
– building painting
– pavement resurfacing
– and any non-operating expense over $10,000
NOTE: Contingency reserves must be operating expenses, not reserves.

1. The documents will specify who will adopt the budget
a. The board, or
b. The membership
2. Budget meeting notice requirements
a. 14 day notice
b. Include copy of the proposed budget, reserve accounts and calculations
3. Proposed budget may be amended prior to adoption.

To be valid, claim of lien must state:
a. Legal description
b. Name of owner
c. Name + address of association
d. Amount due
e. Due dates
f. It must be executed by an officer of the board

If a unit owner or member is more than 90 days delinquent in paying a fee, fine, or other monetary obligation due to the association, the  association may:
1. Suspend the right to use common elements
2. Suspend the voting rights
3. Demand that a tenant pay rent directly to the association
4. Record and enforce a lien against the property

While the statute gives boards broad power, your association’s Bylaws or Declaration may limit that power. For example:

• Spending Caps: Many older Florida documents state the board can only assess up to a certain dollar amount without a majority vote of the owners.

• Material Alterations: If the assessment is for an “improvement” that significantly changes the look or function of the property (like turning a tennis court into a pickleball court 🎾), FS 718.113 usually requires a vote from the membership.

It must be proposed and adopted at least 14

days before the fiscal year begins.