New Safety Law Impacting FL Condo Owners
Since the signing of Senate Bill 4-D by Florida Governor Ron DeSantis, condominium owners and associations are sharing concerns over the likelihood of meeting the new regulation requirements. For some, the new law could mean putting their property on the market.
The legislation—which was triggered by the deadly collapse of the Champlain Towers in Surfside, Florida, last June—requires that condos that are at least three stories high and within three miles of the coast be inspected by a licensed engineer or architect when they reach 25 years of age by 2024.
Buildings of the same size that are more than three miles inland are also required to undergo inspections after 30 years of age.
That same year, condo buildings that are six stories and higher will be required to install sprinkler systems.
In addition, while condo associations were previously permitted to waive reserve funds for maintenance, they will now have to keep enough money in the reserves to fund all repairs necessary to maintain their buildings’ structural integrity. The requirement, however, won’t go into effect until 2025.
“The problem in practicality is that there are thousands and thousands of condos that all need to do this at the same time,” Miami-based construction litigation attorney Gabriel Z. Coelho of Ball Janik told reporters. “And there’s a limited pool of engineers and architects and people who actually do the work that’s being required.”
Nearly a year after the partial collapse of #ChamplainTowers in #Miami’s #Surfside, #Florida enacted new #legislation to address #safety concerns for #condos & cooperative buildings w/ the passage of Senate Bill 4-D. Read the #pros & #cons of the bill ?? https://t.co/34ojX9yRA1 pic.twitter.com/6FNA1b9VAb— Bilzin Sumberg (@BilzinLaw) July 5, 2022
Furthermore, Coelho pointed out that much of the funds required for the reserves would easily amount to hundreds of thousands of dollars for associations and owners.
Around 1:30 a.m. on June 24, 2021, part of the Champlain Towers South condominium in Surfside, Florida was reported to have collapsed. Made up of three buildings, the towers were each 12 stories tall and contained 342 units.
That same day, more than 80 rescue units were reportedly on the scene. By Sunday, 35 victims were pulled from the structure with two more pulled from the rubble. Eleven of them were treated for their injuries.
A state of emergency was also declared on the day of the collapse, which allowed the Department of Homeland Security and FEMA to coordinate relief efforts at the scene, which also involved containing a fire within the debris. The following Saturday, Gov. Ron DeSantis and Surfside Mayor Charles Burkett turned their attention to the “sister building” to the tower that fell, noting that it was built with the same team. Residents in Champlain Towers North began being aided by FEMA to find temporary housing.
Crews also reported that day that a fire had been diminished.
That Sunday, heavy equipment was sent to the scene to help manage the shifting debris after rescuers dug a 125-foot-long trench (20 feet wide and 40 feet deep) to add to the around-the-clock excavation effort.
In later reports, it was determined that the partial collapse had resulted in the death of 98 people.
The complex was built in 1981 by late developers Nathan Reiber and Nattel Construction, which is listed as inactive in state records. Since the collapse, media outlets and the City of Surfside have uncovered documents surrounding the structure’s condition. According to a 2018 inspection report from Morabito Consultants, the condominium had “major structural damage” to its concrete structural slab below the pool deck that needed “extensive repairs.” These damages included descriptions of abundant cracking and spalling throughout the columns and walls, in addition to exposed and deteriorating rebar.
The report was generated in preparation for the building’s 40-year recertification.
While Morabito did not warn that the building was unsafe, it urged the condo association to make repairs soon, as the concrete problems could “expand exponentially.” At the time of this assessment, repairs would have cost an estimated $9 million. However, after dissension among board members and owners, delayed action caused the repair prices to hike up another $6 million to a total of $15 million.
At the time of the collapse, consultants acknowledged that the building was in the early stages of a three-year renovation plan, which had started with roof work about six weeks prior.
In August after the collapse, the U.S. Department of Commerce’s NIST announced its selection of a team of technical experts to investigate the partial collapse of the Champlain Towers South.
Nearly a year after the investigation was launched, the team of federal investigators reported that it had developed roughly two-dozen hypotheses. At the time, the team was working to prove or disprove each potential cause by using compiled evidence from the collapse and various analyses.
During the next steps of the investigation, NIST reported that the team would begin invasive testing and preparation of physical evidence collected from the collapse site. This process will involve manipulating evidence, core drilling and cutting of specimens to collect samples, which cannot be fully accomplished in the tight confines of the current NIST warehouse.
To better prepare for these next steps, NIST brought in a board-certified industrial hygienist to conduct air sampling for asbestos fibers to ensure the safety of those accessing the materials. The preparation and moving of materials to a new location for the next round of testing is expected to take several weeks.
The team is also looking at remote sensing and data visualization.
Prior to the signing of Senate Bill 4-D in late May, the Senate and House of Representatives had been unsuccessful in passing legislation to require inspections of aging condo buildings or mandate repair studies.
In a bill sponsored by State Rep. Daniel Perez, a Miami-Dade County Republican earlier this year, legislation aimed to require inspections of aging condo buildings and mandate that condo boards conduct studies to determine funding amounts that be set aside for repairs.
According to reports, the bill sought to close a loophole allowing condo associations to avoid putting money into reserves, as associations are commonly reported to waive reserve funding to prevent an increase in owner’s fees. Critics note that the latter, however, makes it more difficult to plan or afford necessary repairs.
When it came to voting to pass legislation, a disagreement arose regarding allotted flexibility for condo owners in the funding of reserves. While the Senate believed that the measure would put a financial burden on owners, Perez could not reach a compromise.
In January, State Sen. Jennifer Bradley filed a competing bill seeking require mandatory building inspections for all apartment and condo buildings taller than three stories and larger than 3,500 square feet.
More specifically, the bill intends to:
According to reports, milestone inspections are defined as being required once a building reaches 30 years old and every 10 years thereafter. For structures within three miles of a coastline, the legislation would also require milestone inspections at age 20 and every seven years after that.
These reports are then to be made available to all unit owners and to potential buyers by their respective condo boards. The legislation also allows local governments to impose timelines and penalties related to inspections.
At the time of its filing, Bradley’s bill was reported to be under review and was slated to go into effect on July 1. However, because of the government ongoings, Florida condo law will remain unchanged, and no requirements have been adopted for safety inspections despite the call for reform.
According to the Florida Senate’s analysis of Senate Bill 4-D’s impact, the legislation affects some 1.5 million condos operated by nearly 28,000 associations in the state. The analysis also found that more than two million Floridians live in condos that are 30 years old or older.
On the topic of reserve funding, Eric Glazer, a partner at Fort Lauderdale-based Glazer & Sachs, who hosts the Florida HOA & Condo blog and a weekly radio show, “Condo Craze and HOAs,” said only 5%-10% of condo associations have properly funded their reserves.
In his research, Glazer also found that roughly 50% of condo associations have waived reserves entirely.
“It’s going to have a very significant chilling effect on the market, no two ways about it,” Glazer said.
“The number of things condo associations have to start complying with, either immediately or within the next two years, is staggering,” he continued. “Is it going to be tough? Sure, it’s going to be tough. Are some people not going to be able to afford it? Absolutely.”
For those who can’t afford to meet the new regulations, Glazer and others have hinted those owners and/or associations will have to sell. However, even with developers taking advantage of the market, many believe that there still won’t be enough time for those who can afford the new regulation requirements to get inspections carried out before 2024.
“There’s just not enough time to get these inspections done,” said Fort Lauderdale-based attorney Mark F. Grant of Greenspoon Marder.