Navigating Community Associations Through The COVID-19 Emergency: DBPR Orders Community Associations’ Emergency Powers Apply to COVID-19
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Part I: Florida DBPR Orders Community Associations’ Emergency Powers Apply to COVID-19
COVID-19 has affected community associations in various ways, and new obstacles during these times are presenting themselves daily. Community associations will have to deal with many of these developments in stride and are expected to pioneer their communities during the state-wide shutdown. Due to this pandemic and both local/ state government stay at home orders and social distancing directives, residents are either (a) working from home; or (b) not working at all, leaving many with no resort other than to stay within the community and pass the time through the community’s amenities. This leaves a heightened responsibility on community association boards to ensure the community is functioning to the best of its ability and making decisions with the health, safety, and welfare of its residents in mind. COVID-19 has left community association boards with a plethora of unanswered questions.
This four part blog series is designed to assist community association board members and managers with navigating through this COVID-19 emergency situation. Part I in this blog series addresses the Florida Department of Business and Professional Regulation’s (DBPR) Order that the community association statutory emergency powers are in effect during the COVID-19 Crisis.
The Department of Business and Professional Regulation (“DBPR”) Emergency Order 2020-04
The Flat. Stat. §§ 718.1265 (governing condominium associations), 719.128 (governing cooperative associations) and 720.316 (governing homeowners associations) provide community associations with emergency powers when a state of emergency is declared by government officials. These statutes have the same triggering language and provide community association boards governed under these statutes’ similar emergency powers. The language in these statutes grants emergency powers upon a “response to damage caused by an event.” That language reflects the Florida Legislature’s intentions for these emergency powers to apply when natural disasters such as hurricanes, tornadoes, etc. damage the State. The statutes do not address whether emergency powers apply to pandemics such as COVID-19.
Wisely, the Department of Business and Professional Regulation, Divisions of Condominiums, Timeshares, and Mobile Homes (“DBPR”), the state agency that regulates community associations, enacted Emergency Order 2020-04 (“Order”) on March 27, 2020. A copy of the Order can be found at this link: http://www.myfloridalicense.com/dbpr/os/documents/EO_2020-04.pdf. The Order addresses the “response to damage caused by an event” language in the statutes. Specifically, the Order provides in sum:
The limitation within section 718.1265(1), 719.128(1), and 720.316(1), of the emergency powers of a condominiums associations’ boards of administration, cooperatives associations’ boards of administration, and homeowners’ association boards of directors is hereby suspended. The emergency powers available to boards as described in 718.1265(1)(a)-(j), 719.128(a)-(j), and 720.316(1)(a)-(h), are hereby available to help protect the health, safety, and welfare of the association, owners, owners’ family members, tenants, guests, agents, or invitees.
⁋ 1-3. The Order directly answers the question community associations across the state were wondering. The statutory emergency powers are available for community associations during COVID-19 and the powers’ longevity expires “at the expiration of Executive Order 20-52 [Governor Ron DeSantis’s Emergency Shutdown Order] including any extension.” ⁋ 12.
The Order also addresses how its enactment may affect communities governing documents that address their board’s emergency powers. The Order states “The exercise of any association’s emergency powers remains unless specifically prohibited by the provisions of the association’s governing documents. See §§ 718.1265(2), 719.128(2) & 720.316(2).” Therefore, if the community association’s governing documents speaks to the applicability of the community association’s emergency powers, the governing documents supersede the Order.
The Order also addresses the financial reporting timing requirements for condominium and cooperative associations proscribed in section 718.111(3), 719.104(4). Both statutes require “Within 90 days after the end of condominium or cooperatives fiscal year, the association must prepare and complete, or contract to prepare and complete, a financial report for the preceding fiscal year.” It does not address the financial reporting requirement for homeowners’ associations under Fla. Stat. § 720.303(7), which is due to the DBPR not having jurisdiction over financial reporting issues involving homeowners’ associations. The Order states:
The timing requirements for condominium associations’ and cooperative associations’ financial reports in section 718.111(13) and 719.104(4), Florida Statutes are hereby suspended and tolled.
⁋ 6-7. How this most likely will affect financial reporting for these associations whose deadlines have been affected by COVID-19 is as follows. If it was forty (40) days since the end of the community association’s fiscal year on March 27, 2020, the community association will have another fifty (50) days after the expiration of the Order to comply with the statutory financial reporting requirements. Homeowners’ association boards should be aware that the Order does not toll their financial reporting deadlines. Therefore, community association boards should stay current with when the Order is lifted, and work with their community association managers, attorneys, and/or accountants to determine their new deadline and how many days left to complete these financial reports to comply with statute.
Continued Reading in this Series – Navigating Community Associations Through the COVID-19 Emergency
- Part II: Association Meetings During COVID-19
- Part III: Assessment Collection Considerations During COVID-19
- Part IV: Common Element Considerations