The disaster was one of the deadliest building failures in U.S. history and highlighted the vulnerabilities of condo ownership, where unit owners are collectively responsible for a building’s upkeep. As maintenance needs accumulate, owners often fail to set aside enough money, leading to deferred repairs. Owners at Champlain Towers South, the building that collapsed, had fought over paying for repairs and put them off.
The House passed a bill last week, and a similar measure is advancing in the Senate. Both have bipartisan support, and lawmakers are expected to settle on one version or a combination of both.
A new law, if approved, would be one of the strictest in the U.S. regarding condo inspection and reserve-funding requirements, said Will Simons, president of the Florida office of Association Reserves, which conducts studies on funding reserves for properties around the U.S.
Under the House bill that passed, condo buildings that are three stories or taller would need to be inspected and recertified when they reach 30 years of age, and those within 3 miles of the coast would be required to do so at 25 years. Thereafter, buildings would have to be recertified every 10 years. Under the Senate bill, the inspection process for condos near the coast would kick in at 20 years and be required every seven years thereafter.
Both bills involve a two-phase inspection process: an initial visual inspection and, if that one identifies potential structural problems, a more-intensive, second one. The resulting reports must be submitted to unit owners and local building officials, and the measures have varying provisions to empower local officials to penalize condo associations that fail to address needed repairs.
More than 900,000 of the roughly 1.5 million condo units in Florida are at least 30 years old, and they house more than two million residents, according to bill analyses filed with the Legislature.
The proposals require condos to conduct periodic reserve studies to determine how much money associations need to cover capital projects. Under the House bill, unit owners would no longer be able to waive collecting reserves, as they currently can, for certain building elements, while the Senate measure would tighten requirements for such waiving. Both measures would direct that inspection reports and funding-reserve studies be provided to potential buyers of condo units.
A range of groups representing engineers, architects and building officials support the proposed legislation, and some of the recommendations they provided to lawmakers were included in it. Little organized opposition has emerged, though analysts have said that the legislation would likely lead to steeper maintenance fees for some condo owners.
“We know we have issues out there with a large number of buildings,” said Allen Douglas, executive director of the Florida Engineering Society, which supports the measures. “This is a problem for the entire state of Florida.”
The proposals aim to show unit owners and potential buyers the true cost of ownership in a condo building, including structural repairs and other property maintenance, said Mr. Simons of Association Reserves. “Up until now, people have been able to turn a blind eye to that,” he said. “The spirit of this legislation is to try to correct that.”
If enacted, the legislation could affect the state’s real-estate market, said Trey Goldman, legislative counsel for Florida Realtors, which represents real-estate agents and hasn’t endorsed the overall bills but supports provisions that increase the transparency of condo associations. Unit owners living in buildings that have waived reserve funding for years could see significant jumps in maintenance payments, he said. Those selling units might need to drop their asking prices to account for the greater costs of ownership, he said.
Given strong demand for property in Florida, “You won’t have fewer sales,” Mr. Goldman said. “You will have lower-priced sales for some condominiums,” he said.