Condo-mania: The War on Community Association Managers

The Legislature has deemed it fit to require licensing of Community Association Managers (CAM). They must take a test, pass it and a background check, and undergo regular continuing education.

The Legislature has also made the operations of condominium and cooperative associations -and to a lesser extent, Homeowner Associations (HOA)- some of the most highly regulated industries in Florida. Some examples include requiring that a board of directors pass a rule where notice of board meeting will be posted, how to adopt a budget, require inclusion of reserve calculations for all items that cost more than $10,000 to replace, along with their life span estimated useful life, estimated replacement cost and amount currently held for that purpose. Oh, were it only that the legislature and Congress imposed such restrictions on themselves, so we could see the billions and trillions needed to replace aging roads, bridges, sewers, the electric grid and so forth, but that is a topic for another day.....

Under such regulation, directors of condos and HOAs who are all unpaid volunteers, need the expertise and knowledge that CAMs provide. Think of it as a city council needing a city manager. I don't know if the manager of Clearwater needs to be licensed and pass a criminal background test, although I assume so, maybe not. The point is that CAMs collectively manage hundreds of millions of dollars in infrastructure and are already highly burdened by regulations.

About 20 years ago, the Florida Bar held some hearings on the unlicensed practice of law. They determined that some aspects of work, related to what CAMs do, is the unlicensed practice of law, and is a felony.

Over a decade ago, the Florida Supreme Court ruled that, among other things, preparing a claim of lien to help collect delinquent assessments is the unlicensed practice of law, but new inquiries are being made by bar members.

On June 22, a hearing was held in Orlando, to consider whether the following were the practice of law, which must be performed by an attorney:

"preparation of the pre-arbitration demand letter required by Section 718.1255, Florida Statutes; preparation of certificates of assessments; preparation of documents regarding the right of an association to approve new owners; preparation of construction lien documents; drafting amendments (and certificates of amendments that are recorded in the official records) to the declaration, articles of incorporation, or bylaws, when such documents are to be voted upon by the members; determining the number of days for statutory notice; modifying the limited proxy form promulgated by the Department of Business and Professional Regulation; and determining the number of votes needed to pass an amendment or needed to establish a quorum."

As an officer of the court, it is my responsibility to held protect the public from harm by persons attempting to practice law. As an attorney who has devoted his entire professional life to representing associations, I think the attempt to effectively criminalize certain activities as proposed, is wrong. Guidelines on holding elections and other forms are already on the web site of the Bureau of Condominiums.

At a minimum, it appears to be a self-serving attempt by certain community association lawyers and firms to drive up the cost of operations. While CAMs might be relieved that certain aspects of their jobs, which are already quite busy, might be taken off their plate, so to speak. It will cause delay in getting routine information and have other deleterious effects on association operations if some of the discussed proposals are adopted.

Owners and directors need to become interested in this process and participate. Written comments can be emailed to the committee as linked above. The hearing time ran over and will be reconvened at a later date.

On another front, the battle rages on whether a CAM may be compensated for work involved in tracking and reporting delinquent amounts due with counsel for the association. In these economically distressed times, many CAMs have had to increase accounting staffs, add software, and otherwise devote more resources to collecting assessments just so their communities can stay afloat. This poses a dilemma; raises per-door fees to cover the costs or allocate them to the delinquent owners. Legal fees and certain costs of collection can already be recovered, but the Legislature is already considering codification of the refusal to allow those costs to be passed on. Again, board members, owners who pay assessments and CAMs need to be aware of this. I urge you to contact your representatives and senators and ask them, in this election season, what their stand is on this issue. The outcome has a direct impact on the millions of Floridians who live in and provide services to residential ownership operated communities and their CAMs.

I stand on the side of common sense, and ask the Supreme Court and the legislature not to further burden the volunteer directors of communities and the CAMs who help navigate through these treacherous waters. Stop the war on CAMs and, to a similar extent, associations they operate. Failure to grab the reins on this already trotting beast will not look like dressage; it will end up as a stampede.