Florida Gov. Ron DeSantis has sent a not-so-subtle message to lawmakers regarding the financial crisis that could take place in South Florida -- and in other condo-heavy areas of the state -- thanks to new laws created after the tragic 2021 collapse of the Champlain Towers South in Surfside.
The possibility that new safety and financial reserve requirements could make condominium living too expensive for some residents is already causing panic and slowing down condo sales. There's fear of a double-whammy effect: Condo fees have already increased 60% in the past five years thanks to the rising cost of property insurance and because associations are preparing to meet the new state requirements, the Herald reported.
DeSantis is correct to urge action from the Republican-led Legislature.
Speaking at a news conference in Miami Lakes on Sept. 9, he floated the idea of delaying deadlines or providing no-or-low-interest loans to condo owners hit by special assessment, the Herald reported. He suggested he might not want to wait until the regular legislative session starting in March but he has yet to call a special session.
"This is not something that we can put off until next March or April," DeSantis said. "I think there are a lot of looming deadlines and we have to have a plan forward to keep people in their units if that is what they want to do."
Lawmakers acted quickly after the death of 98 people in Surfside -- and that was much needed. Under previous state law, many condo associations opted not to maintain reserves for routine maintenance, which is no longer allowed. With the exception of Miami-Dade and Broward counties, buildings were not required to undergo inspections in Florida. Post Surfside, the state requires 30-year milestone inspections.
Condo associations also face a Jan. 1, 2025, deadline for a structural integrity reserve study in which an engineer inspects their buildings for safety and figures out how much they need to set aside in reserves for repairs.
It's very likely that lawmakers will revisit the condo issue next year. Yet it's still unclear whether they will propose some type of financial relief for condo owners hit with hefty costs.
Republican state Rep. Vicki Lopez of Miami sponsored Florida's new condo laws. There are 667 condominiums in her district, which covers part of Little Havana, home to many seniors. She told the Herald Editorial Board she understands that costs related to the new state requirements could force those older residents out of their homes.
Among the proposals Lopez is considering for the next legislative session are tweaking condo governance laws and creating a program similar to the one in Miami-Dade County that provides financial assistance to condo owners earning up to a certain income to pay for special assessments.
Whether the Legislature will implement something similar statewide will depend on what yet-not-available statewide data shows, Lopez said. The money associations will have to save after they conduct the structural integrity reserve study will be included in budgets approved mostly in November or December of 2025, Lopez said, way past the regular legislative session.
The only way to convince a conservative Legislature to provide financial assistance to condo owners is by showing data on how big of a problem this is.
"We have to be able to present data to both my (House) leadership and Senate leadership and probably the governor's office," Lopez said.
Yet it's easy to predict that many condo owners will find themselves struggling to pay for higher fees and special assessments on top of skyrocketing insurance premiums and other costs. There are more than 315,000 condo units in Miami-Dade and 250,000 in Broward. More than one-third of those in Miami-Dade and more than half in Broward are at least 40 years old.
We have known that the financial reckoning for many condo owners was coming after Surfside. As that day rapidly approaches, lawmakers need to be ready to help -- or potentially allow another crisis to unfold.