“Budget Amendments Must Follow Specific Process” – News-Press
Q: Can a condominium association change the budget mid-year without a board vote or notice to owners? (S.S., via e-mail)
A: It depends on what you mean by “change the budget,” as that phrase can encompass different things. For example, an association may have budgeted a projected amount for insurance premiums, only to learn that the actual premiums will be higher than the amount projected when the budget was prepared and adopted. But the association may also find that an expense that was budgeted for can be addressed for less than projected and move that money to pay the increased insurance cost. While that may technically be a “change in the budget,” this is common and would not require the adoption of an amended budget.
On the other hand, if the association is going to adopt a revised budget that increases monthly or quarterly “maintenance fees” for the remainder of the year, a set process must be followed. Rule 61B-22.003(7) of the Florida Administrative Code states that any amendment to a budget must follow the procedures required for the adoption of the budget in the first instance.
In most cases, this means that the board will be required to adopt the revised budget at a board meeting that is open to all unit owners. Notice of this meeting and the proposed revised annual budget will need to be hand delivered, mailed, or electronically transmitted to each unit owner at least 14 days prior to the meeting. The notice will also need to be posted 14 days in advance and the budget materials posted on the association’s website for those associations obligated to have mandatory websites.
Please note your condominium documents may impose additional requirements that need to be followed including lengthier notice requirements or the requirement for a unit owner vote on the budget. Please also keep in mind the 2025 change to the law, covered in detail in a previous column, that requires unit owner approval of budgets that exceed 115% of the previous year’s budget, with certain cost increases for that computation being excluded by the statute.
Q: At our last annual meeting, the board of my condominium association changed our vote counting process. The annual meeting was held on the second floor of the clubhouse, but the ballots were taken downstairs and counted there. Shouldn’t the ballots have been opened and counted with the unit owners being present? (P.B., via e-mail)
A: This is a tough issue. One option is to suspend the annual meeting and have the election committee process the outer envelopes and tally the ballots in front of all the owners. This is often a disaster as the proper processing of election ballots usually takes at least an hour (sometimes more) and the owners get very impatient. Further, they are likely to talk with each other during the pause, and the ballot counters will complain that they cannot hear and cannot do their job.
Another option is to conduct the annual meeting with the ballot counters in the rear of the room. This is also not optimal as the ballot counters need to talk loud enough to hear each other, such as to call out vote tallies, so they have to “talk over” whoever is speaking at the annual meeting. This frequently leads to complaints from both the election committee and the annual meeting participants.
Rule 61B-23.0021(10)(a) of the Florida Administrative Code states that election envelopes and the ballots are registered, processed, and counted in the presence of the unit owners. Rule 61B-21.003 of Florida Administrative Code specifically lists “not counting ballots in the presence of unit owners” as a violation subject to penalties.
The law does allow the committee to hold a meeting before the annual meeting (which must be posted and open to owners) to handle the “outer envelope” processing (voter registration), but that only solves half the problem as the opening and counting of the ballots must only be done once the annual meeting starts and the last call for ballots is made.
Although I am not aware of any decisions from the state regulatory agency on the topic, and do not know what their position would be, most legal rights can be knowingly waived. When I attend an annual meeting where the owners wish to have an efficient meeting and trust the integrity of the election committee, I suggest that a motion be made to permit the processing to occur in the desired location outside of the meeting, and if the motion is unanimously approved and reflected in the minutes, that is how it is done. I have never personally experienced a challenge in doing it this way.
Joe Adams is an attorney with Becker & Poliakoff, P.A., Fort Myers. Send questions to Joe Adams by e-mail to jadams@beckerlawyers.com. Past editions may be viewed at floridacondohoalawblog.com.
