Implications of Senate Bill 154 on Milestone Inspections

February 5, 2024
by derreverelaw
DSB&C Insights, Legislative Update

On June 24, 2021, at about 1:20 a.m., a 12-story beachfront condominium in Surfside, FL, Champlain Tower South, partially collapsed. 98 souls perished. In response, lawmakers have since passed laws to try and stop it from happening again. Senate Bill 154 is an amendment to Florida Statute §553.899, which was enacted in response to the Champlain Tower South collapse. Senate Bill 154 – Condominium and Cooperative Associations became effective on June 9, 2023. It outlines specific dates as to when milestone inspections should be completed. A milestone inspection is a type of structural safety building inspection that focuses on the structural integrity of the building’s occupants and determines whether the structure is safe for continued use. Licensed architects and engineers are the only professionals that are qualified to conduct milestone inspections. It is the need to evaluate the structural condition, identify repair needs, assess any deferred maintenance, and search for substantial structural deterioration. The bill revises the milestone inspection requirements for condominiums and cooperative buildings that are three or more stories in height to the following:

 

  • Limit the milestone inspection requirements to buildings that include a residential condominium or cooperative;
  • Provide that the milestone inspection requirements apply to buildings that in whole or in part are subject to the condominium or cooperative forms of ownership, such as mixed-ownership buildings;
  • Clarify that all owners of a mixed ownership building in which portions of the building are subject to the condominium or cooperative form of ownership are responsible for ensuring compliance and must share the costs of the inspection;
  • Require a building that reaches 30 years of age before December 31, 2024, to have a milestone inspection before December 31, 2024;
  • Delete the 25-year milestone inspection requirements for buildings that are within three miles of the coastline;
  • Authorize the local enforcement agencies that are responsible with enforcing the milestone inspection requirements the option to set a 25-year inspection requirement if justified by local environmental conditions, including proximity to seawater;
  • Authorize the local enforcement agency to extend the inspection deadline for a building upon a petition showing good cause that the owner or owners of the building have entered into a contract with an architect or engineer to perform the milestone inspection and it cannot reasonably be completed before the deadline;
  • Permit local enforcement agencies to accept an inspection and report that was completed before July 1, 2022, if the inspection and report substantially comply with the milestone requirements; however, associations must still comply with the unit owner notice requirements, and if a local enforcement agency accepts a previous inspection as a milestone inspection, the deadline for a subsequent 10-year re-inspection is based on the date of a previous inspection;
  • Provide that the inspection services may be provided by a team of design professionals with an architect or engineer acting as a registered design professional in responsible charge;
  • Provide that the condominium or cooperative association is responsible for all costs associated with the inspection attributable to the portions of the building for which it is responsible under the governing documents of the association;
  • Require associations to give unit owners notice about the inspection deadlines, electronically or by posting on the association’s website, within 14 days after they receive the initial milestone inspection notice from local enforcement agency;
  • Require the milestone inspector to submit a phase two progress report to the local enforcement agency within 180 days of submitting the phase one inspection report; and
  • Clarify that an association must distribute a copy of the summary of the inspection reports to unit owners within 45 days of its receipt.

 

The following buildings are exempt from the inspection requirements:

  • Buildings less than three stories;
  • Single-family dwelling;
  • Two-family dwelling;
  • Three-family dwelling with three or fewer habitable stories;
  • Any portion component of a building not owned by the association; and
  • Any portion or component of a building that is maintained by another party.

 

Senate Bill 154 makes the following changes to Florida Statute §627.531:

  • It exempts unit owner policies from the requirement that all personal lines residential policies issued by Citizens Property Insurance Corporation must include flood coverage.

The bill brings big changes to Florida’s Condominium market. The new law requires condo associations to regularly assess the structural integrity of the building and fully fund reserves necessary for maintenance and repairs. However, it comes at a price to the condo owner, which not every condo owner is able to pay. Because of the new law, associations are raising monthly association fees so that they are able to comply with the new requirements. This can also lead to extremely high special assessments.

 

Florida Senate Bill 154 establishes a new movement of accountability and safety for condominium unit owners. The Bill implements responsibility and accountability upon condo associations to ensure structural integrity and safe occupancy of its buildings, taking the necessary steps to ensure another tragedy does not occur. SB 154 establishes liability for board members and officers who fail to abide by their responsibilities for milestone inspections. It requires a willful and knowing failure to obtain the required inspection report which would constitute a breach of fiduciary duty.

 

We expect a rise in lawsuits and newly formed case law should the associations fail to comply with SB 154, which has been enacted to prevent tragedies such as the Champlain Tower South from occurring again.