Alessandra Stivelman and Carolina Sznajderman Sheir, Eisinger, Brown, Lewis, Frankel & Chaiet

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.

Alessandra Stivelman and Carolina Sznajderman Sheir are partners at Eisinger, Brown, Lewis, Frankel & Chaiet in Hollywood. 

Read the order: