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Letter to the editor

Board is just doing its job

By Richard White, Special to the Times
Published August 4, 2007

Q: Our homeowners association board is doing things without a vote. The management says this is legal. Is that true? Must management companies carry insurance for common areas, and are they licensed or supervised by any government agency?

A: Your board may have voted to approve some day-to-day operating policies that allow decisions to be made without specific votes. For example, the board might have approved a policy that the property be inspected weekly and letters sent out citing rule violations. A second policy may direct that liens be filed against delinquent accounts. A third policy may let the manager or president to spend up to $1,000 on minor repairs without advance approval.

Managers execute the orders of the board. They don't make decisions or set policy on their own. With a couple of minor exceptions, managers must be licensed by the Department of Business and Professional Regulation as community association managers. DBPR has disciplinary authority over licensed managers.

As for insurance of common areas, that's a board responsibility.

Some social insecurity

Q: Our condominium president maintains the social committee funds in a safe in his unit. He collects and disperses the money as necessary. There are no reports or review by anyone. Shouldn't there be more public accountability?

A: I understand and support the need and importance of social events, but they are often the source of silent problems and unacknowledged liability.

The condominium statute FS 718.112 makes no provision for the budget to include expenses for socials. Homeowner associations are silent on this topic. Your association insurance may not cover accidents or injuries at socials. Uninsured accidents involving the use of alcohol can become a major uninsured liability.

Money that you collect and spend for social activities may be subject to IRS reporting, and some events may require you to pay state sales tax.

You need to meet with your insurance agent, CPA and lawyer before your next social event. There are legal and appropriate solutions and procedures that will allow you to sponsor socials. Your team of professionals can also guide your president on the records and reports he needs to maintain regarding the money.

Richard White is a licensed community associations manager. Write to him c/o Community Living, St. Petersburg Times, P.O. Box 1121, St. Petersburg, FL 33731. Sorry, he can't take phone calls or provide personal replies by mail, but you can e-mail him at CAMquestions@cfl.rr.com. Please include your name and city.

[Last modified August 2, 2007, 15:19:15]