“Review of the Outcome of the 2026 Legislative Session” – News-Press
The 2026 Legislative Session for Florida concluded earlier this year and did not result in significant changes to the community association statutes, Chapter 718, the Florida Condominium Act, Chapter 719, the Florida Cooperative Act, and Chapter 720, the Homeowners’ Association Act. A number of bills were introduced, but those bills were not passed by the legislature.
However, one substantive piece of legislation that did pass, which will have impacts on community associations, was the legislature’s adoption of HB 797, which contains significant changes to Chapter 617, formerly referred to as the Florida Not For Profit Corporation Act, now the Florida Nonprofit Corporation Act. While Chapter 617 is not limited to community associations, practically all community associations are organized as nonprofit corporations and therefore are subject to Chapter 617 in addition to the substantive community association act.
The following is an overview of the changes that are most relevant to community associations.
The new provisions in the law include many new definitions, few of which are applicable to community associations. The most controversial change is to refer to Chapter 617 corporations as nonprofit, which is not to be confused with “non-profit” in the context of the IRS’s 501(c)(3) organizations.
The new law creates Section 617.0143 regarding “qualified directors.” These are directors who are qualified to vote on conflict transactions, derivative actions, and indemnification decisions. This section safeguards against directors who vote on matters in which they have an interest in that may conflict with and affect their objectivity.
The law establishes the minimum duties of corporation’s registered agent and provides default rules for changing, replacing or terminating a registered agent. The new law revises the default process for amending the articles of incorporation and details the applicable notice standards and the minimum voting requirements for an amendment to articles of incorporation requiring a member vote.
The law establishes the default term length of directors as one year, unless the articles of incorporation or bylaws provide otherwise. Further, a director whose term has expired may continue to serve until his or her successor is selected. The board may fill any board vacancy after three months if the members fail to elect a successor.
The law establishes the procedure for removing a director by judicial proceedings when a court finds that the director engaged in fraudulent conduct, grossly abused the position of director, or intentionally inflicted harm on the entity and that removal is in the best interest of the nonprofit corporation.
The law establishes the minimum duties and standards of care of a director to the nonprofit corporation.
The law expands personal liability protections to directors and officers of all nonprofit corporations, granting them personal liability immunity for all actions or inactions taken in their role as director or officer. The law establishes the minimum duties and standards of care an officer owes to the nonprofit corporation.
The law establishes that all members of a nonprofit corporation have the same rights and obligations, unless the articles of incorporation or bylaws provide otherwise. This provision could have potential implications for community associations with limited voting rights and class memberships.
The bill establishes the default rules governing proxy voting, including the procedure for implementing and terminating a proxy.
The law revises the procedure for derivative proceedings brought on behalf of a nonprofit corporation in that it gives standing to directors and officers of a nonprofit corporation and allows the filing of a complaint without prior notice to the board of directors when providing such notice would be futile.
The law permits nonprofit corporations to merge with other eligible entities and does not require that the surviving entity be a nonprofit corporation.
As stated above, this is not a comprehensive review of the changes to Chapter 617, and any association with specific questions concerning their community should review with their legal services provider. The changes to Chapter 617 become effective July 1, 2026.
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.
