Legal News You Can Use: 2025 - 2026 Community Association Legislative Update

NEW STATUTORY AMENDMENTS

Hurricane Protection (Section 718.113 of the Florida Statutes)

Investment of Association Funds (Section 718.111 of the Florida Statutes)

Last year, the legislature made significant changes to the laws governing hurricane shutters and similar types of storm protection. One notable change provided that unit owners are not responsible for the cost of removing or reinstalling hurricane protection if such removal is necessary for the maintenance, repair or replacement of property for which the association is responsible. This year, the legislature clarified and adjusted those provisions in the following manner: » An association’s declaration may provide that a unit owner is responsible for the cost of removing or reinstalling hurricane protection, even if the removal is necessary for the maintenance, repair or replacement of property for which the association is responsible. » If an association’s declaration does not specify who is responsible for the costs of such removal or reinstallation, then the board will determine if the removal or reinstallation of hurricane protection must be completed by the unit owner or the association. ▪ If such removal or reinstallation is completed by the association, the costs incurred by the association may not be charged to the unit owner. ▪ If such removal or reinstallation is completed by the unit owner, the association must reimburse the unit owner for the cost of the removal or reinstallation or the association must apply a credit toward future assessments in the amount of the unit owner’s cost to remove or reinstall the hurricane protection. » The new legislation removes a provision that previously allowed an association to assess a unit owner when the association removes or reinstalls hurricane protection in situations where such work was the unit owner’s responsibility. ▪ Note – This removal arguably means that an association can only charge a unit owner for those costs if the authority to do so is explicitly stated in the declaration. However, the statute does not clearly address this issue, leaving some uncertainty. ■

Historically, the Condominium Act has not specified the types of investment vehicles a board of directors may use to manage association funds. Instead, boards have been bound by the association’s governing documents and general fiduciary duty principles to guide their investment decisions. Recent legislative changes have clarified this issue by establishing the following: » In fulfilling its duty to manage operating and reserve funds of its association, a board must use best efforts to make prudent investment decisions that carefully consider risk and return in an effort to maximize returns on invested funds. » An association may invest reserve funds in one or any combination of certificates of deposit or in depository accounts at a community bank, savings bank, commercial bank, savings and loan association, or credit union without a vote of the unit owners. ▪ Note – This provision does not address the investment of non-reserve funds, leaving uncertainty regarding the permitted investment vehicles, and the appropriate procedures or requirements, for such investments. Presumably, the investment of these funds would be governed by the association’s governing documents. ▪ Note – This change could benefit associations by allowing them to generate passive income from reserve funds to help offset costs. ■

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