Tuesday, July 04, 2017

Governor's Recent Action Leaves Unit Owners In Older, High-Rise Florida Condominiums Facing Expensive, Fire-Safety Retrofits; Potentially Unaffordable Special Assessments For Retirees Living On Fixed Incomes May Force Them Out Of Their Long-Time Homes

In Fort Lauderdale, Florida, the South Florida Sun-Sentinel reports:
  • Tens of thousands of condominium owners in South Florida and across the state are facing financial pressure to install fire-safety devices in older buildings following Gov. Rick Scott’s veto of a bill that would have allowed them to avoid the work altogether.

    Many unit owners could face thousands of dollars in costs to install fire sprinklers where there are none, while associations face the possibility of levying special assessments to fund upgrades in common areas.

    At least 5,600 condo projects statewide could be affected, although buildings standing less than 75 feet tall would be exempt. Owners in taller structures built after 1994 need not worry as sprinklers for newly constructed projects were mandated that year.

    Association leaders, condo lawyers and residents called the veto a bad deal, while those in enforcement noted that owners have had more than enough chances to install upgrades mandated nearly two decades ago.

    Pio Ieraci, president of the 16,000-resident Galt Mile Community Association in Fort Lauderdale, said the veto will force buildings to spend millions of dollars on sprinklers and other equipment, leading to expensive special assessments — $15,000 to $25,000 per owner, in some cases.

    He said many residents in older buildings are on fixed incomes and could lose their homes in foreclosure if they can’t come up with the money. And he said the assessments could jeopardize the financial stability of condo associations, reduce property values and make it harder for owners to sell individual units.

    “It’s unconscionable and unbelievable,” Ieraci said. “The impact is huge.”

    Under state law, condos taller than 75 feet and built before 1994 must be retrofitted with sprinklers or “engineered life safety systems” by the end of 2019.

    House Bill 653 — sponsored in the House by Rep. George Moraitis, R-Fort Lauderdale, and in the Senate by Kathleen Passidomo, R-Naples — would have extended that deadline until 2022 and allowed condo residents, with a two-thirds vote, to opt out of the retrofits.

    In a 2009 report, the state Department of Business and Professional Regulation, which oversees condos, estimated that 5,600 projects in Florida needed retrofits, though the agency says it doesn’t have a more recent figure.

    In South Florida, the number could top 200 projects, said Donna DiMaggio Berger, a Fort Lauderdale attorney and shareholder with the Becker & Poliakoff law firm representing condo associations statewide.

    The thousands of condos built in South Florida over the past 17 years are not affected. The requirements don’t apply to condo buildings shorter than 75 feet or those built after 1994, when a state law mandated that new buildings have fire sprinklers.

    In a letter to Scott urging him to veto the bill, Julius Halas, director of the Division of State Fire Marshal, said most of the equipment used by firefighters can’t reach a height of more than 75 feet.

    “It has been proven that fire sprinklers are the best means of life safety and property protection available,” he wrote.
    You’ve got a lot of frail residents who can’t move,” said Berger, the attorney. “They are literally shut-ins. They don’t let the pest-control person in, let alone someone to retrofit their unit.”
    Fred Nesbitt, 73, owner of a two-bedroom condo at Galt’s Playa Del Mar and president of its association, said he and other residents already feel safe. Their 347-unit building has smoke detectors and fire alarms throughout.

    In 2015, the building completed $4.5 million in structural repairs, and many of the residents can’t afford another assessment, Nesbitt said. “Coming on top of that, it would be devastating,” he said.

    Eric Berkowitz, 67, who lives in a three-bedroom Galt condo, said he and many of his neighbors live on modest means and wonder whether assessments will force them to leave.

    We’re frightened, is basically what it comes down to,” he said. “I live on a pension and Social Security. Most of the people here are not masters of the universe. We can’t afford something capricious like this.”