by Brian Tight, Director of Developer Relations & Lake Worth Regional Director, Campbell Property Management

HOADuring your HOA turnover, also known as the developer turnover process, your homeowners’ association can expect for many events to take place. The turnover process is a momentous occasion, if not the most important in a community’s history. During this process, homeowners are given control of their community.

At the time of the turnover, your HOA will obtain all of the items that are listed in the contract from the developer. In Florida, the law requires that the developer handover control of the homeowners’ association to the homeowners three months after 90% of the homes have been transferred to their buyers. At this point, homeowners are entitled to elect the majority of the board. The developer is still entitled to appoint at least one board member provided that it holds for sale at least 5% of the homes. Depending on the time restrictions and how many units have been conveyed to their purchasers, homeowner associations will be able to begin electing their board members.

Besides the standard turnover process, other events that can initiate the process include bankruptcy, receivership of the developer, and the appointment of a state court receiver. Once the homeowners are given legal control from the developer, they must accept the responsibility to manage the community themselves.

Your homeowners’ association should proceed through the turnover process properly, meticulously, and vigilantly. It is important to obtain as much information from the developer as possible during the turnover. Ask your property management company for assistance, as they should have prior experience with this turnover process. Read Florida Statute 720.307 – Transition of association control in a community (with respect to homeowners’ associations), for more information.

Has your community recently experienced developer turnover? Let us know in the comment section below.

Tags:
  1. John says:

    During the transition of the Board from the developer to homeowners, what if there is a vote tie for the last position of the board…how is the tie broken in a Florida HOA?

  2. Jeff Reagan says:

    We’re in an HOA that is soon to be sold out and turned over to the owners. I was told that the developer is required to provide an engineering report at their expense, but I can’t find the requirement listed in any of the State legislation. Can you point me in the right direction?

    • Anonymous says:

      If you are an HOA, you can find Developer transition information in 720.307.
      If you are a Condo, you can find Developer transition information in 718.301.

      If you have not hired an attorney to represent you in the turnover, you may wish to engage one.

    • Magda Stelzl says:

      We live in a developer controlled community. The original documents stated that turnover to the residents is to be 15 years from inception in 1998, which would have been January 2013. The developer filed an amendment to give himself an “open” turnover date. According to the arbitration report this amendment is not legal because there was never any vote about it.

      After a long and drawn out process some home owners contacted the Florida Department of Business and Professional Regulation for and Arbitration-HOA Election.Relief was granted.

      What I would like to know is who pays for all the various turn-over expenses. I know we need competent legal and financial counsel of our own. Are we as the new Board to pay our own expenses or is the developer obligated for at least some part of the expenses?

  3. Oliver Z says:

    What happens if a board has been formed with one new owner elected as president and a relative of the builder Owner of the other occupied unit and the rest of the units unsold not all completed. Who has to pay maintenance fees???

  4. Lori O says:

    Our community is completely built out, and has been for many YEARS, yet the developer refuses to turn over the association to the homeowners. How do we (homeowners) proceed to get the developer to release the HOA to the homeowners? The developer has been very secretive about the financial records and we have, in fact, found many errors and missing monies in the few (hardcopy) versions that are released to us. Appreciate any guidance!

  5. lawrence hickey says:

    Our HOA is controlled by the builder until a build out fraction of the homes are competed and sold, but the HOA is building
    restaurants, a golf course, and other expensive amenities which where not part of the HOA when I signed on. Now it seems There
    is no limit on what kind of enterprise the current builder-controlled HOA could start. The current home owners see these are useful as a sales lever for the builder, but 1) I have no faith that these enterprises will be financially successful, and 2) I did not
    agree to this extension of the scope of the development. In fact, when the planning for the Golf course was announced, we- the
    existing owners- were given as guarantee that the Golf enterprise expenses would be accrue to the general HOA, and it would
    be treated as a distinct enterprise, but now those promises are ignored, and instead we are given pep talks and “we are all in this together” speeches, and in place of a dispensation from Golf expenses, the net of Golf income and expenses is to be credited to the general HOA, but this is a net loss for the non golf members, and soon the other enterprises will go online too.
    After turnover the homeowners, free of builder control, will be left with white elephant marketing artifacts to fund. Only semi facetiously one may suspect a polo pony facility and heliport. What could legally stop them? Apparently nothing. Smells like fraud to me to be presented with a bill because without our consent we are now proprietors of these dubious enterprises.

  6. GERARD PROSPER says:

    Florida Validity of fees set as assessments by developper without meetings of members.?
    Secondly, can a developer or association claim any back fees after turnover?

  7. Dave says:

    Are residents of a COA allowed to view the statutory turnover documents required in the process: ie – finance audit, engineering study, and reserve study? … Thank you.

  8. Maria Miranda says:

    I just bought a townhouse in a Florida HOA community with 96 units still controlled by the developer. It was built in 2006. I have asked fro many documents and it takes forever for them to give you and they do not even answer the phone. I am going to send a certified letter to request the documents and I want to sit down and see all the books. Some neighbors say that the developer owns about 30 units. If he does, can we force him to sell those units so we can have an appointed and elected board? Some homeowners claim that the developer does not pay the maintenance fees. I doubt it but…
    What are our recourses?

  9. Mia Diaz says:

    Our developer claims that he has turned over everything to the Association Board in the meeting minutes. However, there never has been an official meeting for this, he is still serving as President of the Board and two of his Development company employees are serving as Secretary and Treasurer of our Association for which they charge the Association 7500. yrly. It is a unique situation I believe, because there haven’t been many persons interested in running for any positions, mostly because he is on it. Actually, the members of the Board and Directors have been practically the same for years. Do we have to have an “official” turning over meeting, if so, is there any time limitation after he has sold all of his units. There are a few structural issues we have been waiting to discuss once this event occurs……I’m just wondering if we will be out of luck or time.

    • Ashley Dietz says:

      When 90% of the units are sold and closed, the developer has 90 days to turn the association over from developer to homeowner control.
      This includes sending notices to all residents providing a date, time and place of election. The residents would elect a new Board at this meeting to take control of the association and then also have the right to a list of items the developer is required to turn over.

  10. patriciapp says:

    Our developer turned everything over (Oct. 2013) to a newly elected Board (Dec. 2013). The Board wants to get rid of the management company. Can they do so without having to buy them out and/or pay lots of legal fees? Is there a way they can just tell the management company their services are no longer needed?

Leave a Reply

Your email address will not be published.