Every year about this time I am asked, “how does this years legislation affect our cooperative? Jeff, you wrote about condominium and homeowners’ association legislation, what about us cooperatives? You asked for it, you got it!
Owner Directories. A cooperative association may publish a directory providing ALL of the telephone numbers associated with an owner in addition to an owner’s name and address. An owner can also provide their written consent to the disclosure of other contact information which is otherwise not supposed to be disclosed by the cooperative.
Return of Records and Property by Outgoing Board and Committee Members. Within five days after the new board and committee members are elected or appointed all prior board and committee members are now under a statutory obligation to return all official records and property of the cooperative in their possession, or control, to the incoming board and committee members. Those outgoing board and committee members who willfully and knowingly fail to return such records and property are subject to penalties imposed by the Division of Florida Condominiums, Timeshares, and Mobile Homes.
Financial Reporting. Within 90 days following the end of the fiscal year, unless otherwise provided in the bylaws, the cooperative must prepare and complete, or have prepared and completed, a financial report for the preceding fiscal year. The financial report, or a notice that the financial report is available at no cost upon request, must then be provided to the owners within 120 days following the end of the fiscal year, unless otherwise provided in the bylaws. A majority of the members present at a membership meeting can vote to waive the financial reporting requirement for a fiscal year but cannot do so for more than three consecutive years and can vote to raise the level of financial reporting. Financial reports are to be prepared in the following manner:
• An association in a community of fewer than 50 units, regardless of the association’s annual revenues, shall prepare a report of cash receipts and expenditures in lieu of the financial statements required by paragraph (b), unless the declaration or other recorded governing documents provide otherwise.
• An association with total annual revenues of less than $150,000 shall prepare a report of cash receipts and expenditures.
• An association with total annual revenues between $150,000 and $299,999 shall prepare a compiled financial statement.
• An association with total annual revenues between $300,000 and $499,999 shall prepare a reviewed financial statement.
• An association with total annual revenues of $500,000 or more shall prepare an audited financial statement.
Board Member Eligibility and Suspension.
A member who has pending charges for felony theft or embezzlement involving the association’s funds or property may not be appointed or elected to a position as a director or officer. A member who has been convicted of any felony in any state or who has been convicted of any offense in another state which would be considered a felony if committed in Florida is not eligible for board membership unless their rights have been restored for at least 5 years as of the date the member seeks election to the board. A member who has been suspended or removed by the Division of Florida Condominiums, Timeshares, and Mobile Homes or who is delinquent in the payment of any monetary obligation due to the association is not eligible to be a candidate for board membership and may not be listed on the ballot.
A director or officer charged with felony theft or embezzlement involving the association’s funds or property is suspended from office; the vacancy of which is filled by the board until the end of the suspension or the end of the term, whichever occurs first. However, if the charges are resolved without a finding of guilt or without acceptance of a plea of guilty or nolo contendere, the director or officer shall be reinstated for the remainder of the term. The validity of an action by the board is not affected if it is later determined that a board member is ineligible for board membership because the board member was convicted of a felony.
Emergency Powers. A cooperative can perform several actions in the event of a “state of emergency”, unless specifically prohibited by the association’s recorded governing documents. Among others, such actions of the board include the following: (i) designating assistant officers, who are not directors, which will step into the shoes of an officer in the event the officer is incapacitated or unavailable; (ii) conducting, canceling or rescheduling association meetings and providing notice of such meetings in as practicable a manner as possible as the board deems appropriate under the circumstances; (iii) mitigating further damage, which may include the removal of debris and the removal of wet drywall, cabinets and fixtures; (iv) implementing a disaster plan before or immediately following the “state of emergency” event; (v) requiring the evacuation of the cooperative property; and (vi) contracting, on behalf of the owner and at the owner’s expense, for items or services which the owner is responsible. Additionally, based upon the advice of emergency management officials or licensed professionals hired by the board, the board may determine if the property or any portion of the property is unavailable for entry or occupancy or if the property or any portion of the property can be safely inhabited or occupied.
The board may, without a vote of the members, levy special assessments and borrow money, using the association’s assets as collateral, to fund repairs and to carry out the association’s business in the event the operating funds are not enough.
All of these emergency powers are only available to the board for a period of time that is reasonably necessary to mitigate further damage and make repairs and to protect the health, safety and welfare of the association and the residents of its community.