UPDATE - CONDO PILOT PROGRAM INSPECTION APPLICATIONS NOW AVAILABLE

November 18, 2024

UPDATE – CONDO PILOT PROGRAM INSPECTION APPLICATIONS NOW AVAILABLE

The Florida legislature has recently introduced a new mechanism for condominium associations to receive inspections and potentially government funds to improve their properties. These changes may be found in Florida Statutes, Section 215.5587, which was created through House Bill 1029. This new law takes effect on July 1, 2024 and creates the My Safe Florida Condominium Pilot Program (the “Pilot Program”). Pursuant to the Pilot Program, condominium associations may receive inspections from licensed inspectors and grants to further protect the condominiums from hurricane damage. However, in order to receive these inspections and grants, an association must comply with the requirements of the statute. Individual condominium unit owners may not participate in the Pilot Program. Importantly, the Pilot Program website went live on November 14, 2024. Accordingly, condominium associations may now submit applications for inspections and begin the Pilot Program process. The application can be found at https://mysafeflcondo.com/. As the funds available are limited, we recommend that associations submit inspection applications as soon as possible.

INSPECTION:

In order to start the process and qualify to receive a mitigation inspection, a condominium association must receive the approval of either the majority of its Board of Directors (or similar organizational structure) (hereinafter the “Board”) or the approval of half of the total voting interests of the association members. Once the association obtains the requisite Board or membership approval, the association may submit an application for an inspection to the Department of Financial Services’ vendor. An application for inspection under the Pilot Program must include a signed or electronically verified statement, made under penalty of perjury, by the president of the Board that the association has submitted only a single application for each property that the association operates or maintains.

The statute also sets forth the requirements to be considered a licensed inspector under the Statute. Licensed inspectors perform inspections of the condominium to determine the mitigation measures that are needed, the insurance premium discounts that may be available to the association, and the improvements to existing properties of the association that are needed to reduce a property’s vulnerability to hurricane damage. The association does not need to apply for a grant under the Pilot Program in order to apply for and receive an inspection under the Pilot Program.

Inspections provided under the Pilot Program must include the following items:

- An inspection of the property, and a report that summarizes the results and identifies recommended improvements the association may take to mitigate hurricane damage;
- A range of cost estimates regarding the recommended mitigation improvements; and
- Information regarding estimated insurance premium discounts, correlated to the current mitigation features and the recommended mitigation improvements identified by the inspection.

ELIGIBILITY FOR GRANT:

After the initial inspection has been completed, the association may be deemed eligible to obtain funds under the Pilot Program. However, to proceed with this next step, the association will need to receive a unanimous vote from all unit owners within the association to receive a mitigation grant. This vote can take place at either the annual meeting or a special meeting of the membership called for the purpose of conducting this vote.

However, before placing this measure before membership, the association must provide a clear disclosure to the owners of the Pilot Program via a Department of Financial Services provided form. The President and Treasurer of the Board must both sign the disclosure form stating that the form was provided to each unit owner of the association. This signed disclosure, along with the minutes from the unit owners’ meeting where the unit owners vote to participate in the Pilot Program must be retained as official records of the association.

Within 14 days of obtaining the requisite unanimous affirmative vote to participate in the Pilot Program, the association must provide written notice to all unit owners pursuant to Section 718.112(2)(d), Florida Statutes, informing all of the unit owners of the decision to participate in the Pilot Program.

APPLICATION FOR A GRANT:

Once the association receives the unanimous affirmative vote, it may finally apply for a grant under the Pilot Program. The application for a mitigation grant provided for under this Pilot Program must include:

1. A signed or electronically verified statement made under penalty of perjury by the president of the Board that the association has submitted only a single application for each property that the association operates or maintains;
2. A notarized statement from the president of the Board containing the name and license number of each contractor the association intends to use for the mitigation project; and
3. A notarized statement from the president of the Board which commits to the department that the association will complete the mitigation improvements. If the grant will be used to improve units, the application must also include an acknowledged statement from each unit owner.

COMPLETION OF WORK:

If the association receives a grant under the Pilot Program, it may use contractors of its choice to perform mitigation work as long as each contractor meets all qualification, certification, or licensing requirements pursuant to general law. In other words, the contractor must be legally qualified to do the work they are hired to perform. In order to receive the final grant funds, an association must complete the entire mitigation project and make the property available for inspection once the same is complete. This inspection will ensure that the mitigation improvements are consistent with the intention of the Pilot Program and meet or exceed applicable Florida Building Code requirements.

The work must be completed, or an extension must be requested, within one year after receiving grant approval. If the association fails to complete the work or request an extension in that timeframe, the application will be deemed abandoned and the grant money will revert to the Department of Financial Services.

FUNDING GUIDELINES:

As to funding, the following guidelines are provided in the Statute:

1. All grants must be matched on the basis of $1 provided by the association for $2 provided by the state.
2. For roof-related projects, the grant contribution is $11 per square foot multiplied by the square footage of the replacement roof, not to exceed $1,000 per unit, with a maximum grant award of 50 percent (50%) of the cost of the project.
3. For opening protection-related projects, the grant contribution is a maximum of $750 per replacement window or door, not to exceed $1,500 per unit, with a maximum grant award of 50 percent (50%) of the cost of the project.
4. An association may receive grant funds for both roof related and opening protection-related projects, but the maximum total grant award may not exceed $175,000 per association.
5. Once the appropriated funds have been distributed or accounted for, the Department of Financial Services may not accept applications or maintain a wait list unless expressly authorized by the legislature. Thus, getting a timely application submitted and inspection completed as quickly as possible is critical.

As long as it is supported by the inspection report, the grants may be used for the following improvements:

1. Opening protection, including exterior doors, garage doors, windows, and skylights.
2. Reinforcing roof-to-wall connections.
3. Improving the strength of roof-deck attachments.
4. Secondary water resistance for roof.

The grants may be used for a previously inspected existing structure on the property. However, the grants may not be used to install the same type of improvements that were previously installed or pay a deductible for a pending insurance claim for damage that is part of the property for which grant funds are being received.

If an association previously installed improvements to protect the property which complied with applicable building codes at the time of installation, and then receives grant funds, the association must use the mitigation grant to install improvements that both comply with or exceed the applicable building code in effect at the time of the grant application and provide more hurricane protection than the improvements that the association previously installed.

SUMMARY

In summary, the following is a list of the process to obtain a Pilot Program grant:

Properly notice a meeting of the Board or the Membership for voting on obtaining an inspection for purposes of the Pilot Program (Board Meeting will be much easier). The approval from either a majority of the Board or a majority of the total voting interest of membership is required. You will need to check your association’s governing documents to determine the notice requirements for this meeting and the Association should consult with legal counsel to ensure proper notice and procedures are followed in the process.

Apply for an inspection with the Department of Financial Services’ chosen vendor and have a contracted certified hurricane mitigation inspector perform the requisite inspection. A perquisite of filing an application for inspection is obtaining the statutorily-required Board or membership approval.

- The application must include a signed or electronically verified statement made under penalty of perjury by the president of the Board that the association has submitted only a single application for each property that the association operates or maintains.

President and Treasurer of the Board execute Department of Financial Services disclosure form for membership vote on grant application. This form has not yet been provided by the Department of Financial Services.

- Properly notice a meeting of the membership to vote on receiving grant funds. This notice must be sent at least 14 days in advance of such vote and the vote may take place at the annual meeting or a special meeting of the membership. You will need to check your association’s governing documents to determine any other notice requirements for this meeting. In order to obtain grant funds under the Pilot Program, all owners must vote in favor of receiving such funds. The votes may be cast in person at the meeting or collected prior via proxies.
- The minutes from this meeting and the Department of Financial Services disclosure form must be retained as official records of the Association.

Within 14 days of unanimous owner consent to participate in the Pilot Program grant, the Association must provide written notice to all unit owners pursuant to Florida Statutes Section 718.112(2)(d) informing all of the unit owners of the decision to participate in the Pilot Program.

Apply for the Pilot Program grant. This application must include:

- A signed or electronically verified statement made under penalty of perjury by the president of the Board that the association has submitted only a single application for each property that the association operates or maintains;
- A notarized statement from the president of the Board containing the name and license number of each contractor the association intends to use for the mitigation project; and
- A notarized statement from the president of the Board which commits to the department that the association will complete the mitigation improvements. If the grant will be used to improve units, the application must also include an acknowledged statement from each unit owner.

Upon receiving grant approval, perform the complete mitigation project within one year of grant approval or submit a written request for an extension within one year of grant approval. Failure to comply with this requirement could result in forfeiture of grant funds.

Once the project is completed, make the property available for inspection to ensure that the mitigation improvements are consistent with the intention of the Pilot Program and meet or exceed applicable Florida Building Code requirements.

The Pilot Program went into effect on July 1, 2024. As of today’s date, the website for the Pilot Program states that applications for the Pilot Program have been accepted starting November 14, 2024. The application can be found at https://mysafeflcondo.com/

We hope this guide answers any inquiries you may have regarding the new Pilot Program and the requirements for same. Should you have any additional questions, please contact our office. It is important to note that the Bill creating the Pilot Program was only recently signed and the website for the Pilot Program just became active. This guide is subject to change and may not be accurate in the future, as more information is provided by the legislature, judiciary system, and/or Department of Financial Services.

Eisinger Law., is a full service Florida law firm focusing on community association law, real estate law, developer representation, commercial litigation, insurance law, estate planning and probate. For more info visit eisingerlaw.com.