On March 27, the
Florida Department of Business and Professional Regulation
issued Emergency Order 2020-04 in response to the COVID-19
crisis.
It was the first time the department weighed in on the
global pandemic, attempting to clarify ambiguities for the
thousands of community associations throughout the state. It
is estimated that more than 60 percent of Floridians either
live in a community association such as a condominium,
homeowner association or a co-op.
The order helped clarify some questions but also left many
more unanswered.
For instance, the order affirms that the COVID-19 pandemic
is indeed an emergency and indicates that the statutes that
provide community associations with emergency powers are
applicable to the COVID-19 epidemic.
This appears to be in direct response to the debate
surrounding the language “response to damage caused by an
event” as practitioners argued that “damage” needed to be
physical damage to the property, i.e. a hurricane or
windstorm as was likely its original intent.
Order 2020-04 suspends the language “response to damage
caused by an event,” allowing community associations to
avail themselves of some but not all of the emergency
powers.
Although this DBPR order confirms the availability of the
statutory emergency powers during the COVID-19 crisis, it
appears that the division did not feel it was necessary to
apply or fully activate all subsections of the emergency
powers statutes at this time.
This is a critical distinction because the DBRP order
specifically omits the powers that permit an association to
borrow money and levy special assessments if needed.
Community associations are inevitably bound to feel the
effects of the financial hardships that we are facing as a
result of this pandemic.
So what does this means for an association?
The order provides the emergency powers described in
subsection 718.1265(1)(a)-(j), which pertains to
condominiums and co-ops, and 718.1265(1)(a)-(h) for
homeowner associations but left out subsections (k-m) for
condos and co-ops, and (i-k) for HOAs, thereby omitting
multiple financial provisions from the order.
This will become an issue that will require further order
and/or clarification, particularly as associations come
under financial strain. There will likely come a time in the
near future when associations are unable to meet their
financial obligations as we begin to experience the
trickle-down effect of the millions of people who are now
out of work.
Another item the order provides for is the suspension of the
timing requirements for the filing of financial reports.
Other than the items stipulated in Subsections 1(a)-(j) for
condos and co-ops and 1(a)-(h) for HOAs, all other functions
of the association remain intact and are not altered by the
emergency powers.