Last year, after Hurricane Irma came and went, many Community Associations were looking at cleanup and repair costs that exceeded their expectations – and budgets. How do Associations pay for storm damages and repair bills when they come due? There are basically three ways to pay these bills: Borrow from the bank, raise the regular assessments in the coming years’ budget, or levy special assessments. Most Associations don’t want to pay bank interest unless necessary, and they also don’t want to raise regular assessments that much from year to year, so the most frequently chosen method used to fund these unforeseen expenses is through levying special assessments. Post 2005 (Hurricane Wilma), the Florida State Legislature enacted broad emergency powers for Community Association boards to use after hurricanes to address these types of issues. For Condominium Associations, it is Section 718.1256, Florida Statutes; and for Homeowners Associations, it is Section 720.316,

Start Planning for a Disaster Now Consider this scenario: You are a board member for a Condominium Association that represents over 300 residents in a condominium complex consisting of two towers. In the early hours of a Thursday morning, you are awakened by a loud knocking at your door. You open it to find a frantic resident telling you that a building is aflame and the fire department has begun to evacuate people. You get dressed and go outside to see four units are actively burning and others significantly damaged. What are you going to do? As a board member, do you have a responsibility to take action? Do you know the plan? Disasters, natural or man-made, occur with alarming regularity. Disasters can occur without warning at any time of the day or night. There are many ways a disaster can detrimentally affect a community. Just like in the above

After experiencing Hurricane Irma last year, many questions arose during preparations for the storm and after the storm made landfall relating to insurance coverage for damages caused to a community’s buildings, common areas and other property, as well as to individual condominium units. As a Board Member and/or resident living in a Condominium Association, it’s important to know the details and limits of the Association’s insurance policy. In the aftermath of Hurricane Wilma (2005), the issue arose in the context of insurance coverage disputes where condominium associations made claims under their property insurance policies while the unit owners simultaneously made claims under their homeowners insurance policies for the same storm resulting in the denial of their claims by the competing insurance companies. Why? Because under the association’s insurance policy it claimed that the unit owners homeowners insurance company was responsible and vice versa. In order to provide clarity relating to

Preparation is the key to good management. Hurricane season beings on June 1 st and now runs through November 30 th , and as you are well aware, having a Hurricane Preparedness Plan in place makes the process of preparing more efficient. To help you be better prepared, our team at KW Property Management, along with the help of our friends at BB&T, have created a checklist of the items you should include. FINANCIAL PREPARATION Fund reserves at least partially; the absence of any cash reserves will hinder an association’s ability to make a deposit to a contractor who is available. Consider a special reserve to fund insurance deductibles and/or items not covered Consider making arrangements for a line of credit with your bank, so that you will have available cash to meet emergencies and secure contractors. Consider applying for an Association credit card to allow managers to purchase preparation

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