By Rich Pollack
Highland Beach leaders think a state law requiring many condos to stash sizable sums of dollars in reserves following the 2021 high-rise collapse in Surfside is at best unnecessary and at worst an astounding stretch of authority.
Now the Town Commission is letting those who can change the law know its position via a letter being sent to a local state representative who they hope will share it with legislative leaders.
“I think it’s a gross overreach to tell the public what they should do with their money,” Mayor Doug Hillman said during a December commission meeting.
Hillman, who is president of his building and the umbrella organization at Boca Highland Beach Club and Marina, believes that reserves are not needed since the state now requires condos over a certain height to be inspected within the next three years and structural issues repaired.
Many of those repairs, he says, will have to be done before the end of 2024, when condos are required to have completed reserve studies and met recertification requirements. There are also required recurring recertifications.
The costs to individual unit owners for the repairs, for a reserve study and for the reserves themselves combined with the rising cost of insurance for high-rise buildings is going to be too much for some condo residents, Hillman says.
“It’s getting very expensive to live by the beach,” he said. “The bottom line is that some people are going to have to leave.”
At the center of Highland Beach’s concerns is state legislation passed during the spring and signed into law by Gov. Ron DeSantis on May 26.
The legislation outlined inspection requirements of any building over three stories in height and spelled out specific requirements for reserves, making them mandatory. The list includes nine specific items plus any deferred maintenance items over $10,000.
Previously, condo associations were required to include reserves in their annual budgets, but they were permitted to waive collection of fees or reduce the amount as long as a majority of unit owners agreed in a vote.
The new law essentially takes the decision on whether to require reserves out of the hands of residents. The requirement does not take effect until the end of 2024, and there is talk in Tallahassee about revisiting it.
“I believe it will be reviewed and revisited and fine-tuned,” said newly elected state Rep. Peggy Gossett-Seidman, a Republican from Highland Beach, who will be receiving the town’s letter and sharing it with leaders in the Florida Legislature. “We don’t want condos emptying out with residents fearing they can’t afford to stay and are uncertain about the future.”
Gossett-Seidman said that the Legislature was quick to get rules in place but after getting input from residents would most likely review the requirements.
“Sometimes you have to get a law on the books and then come back the next session and tweak it,” she said.
While most Highland Beach commissioners think the law needs to be revisited, Vice Mayor Natasha Moore sees an upside: “If you make requiring reserves law, you take it out of the condos’ hands. If you force them to have the money there, you squash the argument that they can’t afford it.”
Hillman says that requiring residents to put money into reserves could be unfair to people who decide to move before those reserves are used. Instead he believes that condo associations would be better off getting loans from financial institutions in the event the money is needed for repairs.
“There are a lot of other things that can be done besides telling people what they have to do with their money,” Hillman said. “I think the pendulum has swung too far and they just need to bring it back.”
Commissioner David Stern, who is president of his condominium — which does collect money for reserves — believes having the funds available is a good idea but says it should be a decision made by residents, not by the state.
“I feel having fully funded reserves is the right thing to do, but it should be a choice,” he said. “I’m strongly for choice, not mandates.”
Comments