Bill Watch – Lisa Miller Associates

Recap of Week 8 & Preview of Week 9 of Session

The Florida Legislature is scheduled to end its 60-day session on Friday and while the Senate has passed substantive insurance consumer protections, it’s frankly doubtful that the House will consider them. That means a further deterioration of the state’s dire property insurance market, with more double-digit rate increases and less consumer choice as more carriers either pull out of the market or become insolvent.

My reason for skepticism: House Speaker Chris Sprowls (R-Palm Harbor) told reporters last week that while he’ll evaluate the Senate’s proposals that build on last year’s SB 76 reforms, “I’m also cognizant of the fact that we just passed a very significant insurance bill last session. If what has been told to me in the eight years that I’ve been here from the insurance lobby is true, which is that it takes 18 months to see an impact in rates, which is what I’ve been told over and over and over again, then I don’t think we’re yet seeing the impact that we’re having in rates by the bill that we passed last year.” Translation: come back next year if there’s still a problem.

Speaker Sprowls reference to the 18-month lag between action and reaction in the market is simply proof that our lawmakers should have taken these matters more seriously over the last four years when the industry was repeatedly calling for reforms before the situation reached the crisis-level it has become today. Senator Jeff Brandes (R-Pinellas) commented in a Tweet, “How high will rates for Floridians have to go before the legislature acts? Time for @GovRonDeSantis to throw down the gauntlet and demand legislature fix this insurance train wreck.” The House clearly has been reluctant to address roofing fraud and has watered down proposed Citizens Property Insurance reforms.

Also up in the air as we begin this last week of session are bills on further reform of assignment agreements, insolvent insurance company regulation, expanding the domestic surplus lines’ footprint, condominium building safety, construction defects regulation, consumer data privacy, and flooding/sea level rise resiliency programs. Several more bills are on their way to the Governor, including further reforms on public adjusters, tougher limited fines for contractors who solicit a homeowner to file a roof claim, and an extension of the hurricane mitigation loss program.

And then, of course, there’s the state budget for the July 1 fiscal year – the only bill the legislature is required by law to pass. Budget negotiations between the House and Senate continued through this past weekend over the $3.3 billion difference between the two chambers’ budgets. Leaders will need to finalize the budget by tomorrow night (March 8) in order to have the mandatory 72-hour period meant to allow members to read the budget bill and then vote and adjourn as scheduled this Friday, March 11.

This Bill Watch is separated into two categories – “Bills in Play” and “Bills Not in Play”. For those of you who were following closely and have a favorite that has been placed in the latter, don’t forget: It has been my experience that most good ideas take 3 years to pass!”

Here is a master list of the legislative bills we’re following so far in this 60-day session. You can click the bill link in the list below to go directly to the bill and its details farther below. “New” and “Updated” bills are so noted. Updates within each bill are noted in blue font:

Citizens Property Insurance Updated
Property Insurance Updated
Insurance Policies (aka Insurance Omnibus Bill) Updated
Insolvent Insurers Updated
Property Insurer Reimbursements Updated
Domestic Surplus Lines Insurers Updated
Department of Financial Services (DFS) Updated
Fraud Prevention Updated
Motor Vehicle Glass
Hurricane Impact Programs Updated
Sales Tax Refunds for Building Mitigation Retrofit Improvements
Mandatory Building Inspections Updated
Community Association Building Safety Updated
Community Association Database
Powers of the Florida Building Commission
Condominium Associations
Construction Defect Claims Updated
Building Inspection Services Updated
Motor Vehicle Insurance (PIP)
Consumer Data Privacy Updated
Judicial Notice Updated
COVID-19-related Claims Updated
Communicable and Infectious Diseases
Insurance Coverage for At-home COVID-19 Test Kits
Telehealth
Veterinary Telehealth
Nutrient Application Rates Updated
Statewide Flooding and Sea Level Rise Resilience Updated
Advanced Air Mobility Updated

Citizens Property Insurance – HB 1307 by Reps. Tommy Gregory (R-Sarasota) and Mike Giallombardo (R-Cape Coral) would allow surplus lines companies to do takeouts of Citizens policies, just as admitted carriers can do. The bills also have other provisions to attempt to stem Citizens explosive growth, which ended 2021 with a policy count of 759,305, a 40% increase from 2020, with continued growth of almost 5,000 policies weekly. They would make a current Citizens policyholder ineligible for renewal unless a private insurance company take-out premium is more than 20% higher than the Citizens renewal premium; and require Citizens to keep any premium in place from an unsound insurance company policy that Citizens assumes unless Citizens’ premium is higher.

The bill was revamped at its last hearing before the House Commerce Committee on February 23, where a “strike all” or “delete all” amendment made significant changes in the bill, passing on an 18-5 vote. This watered-down bill:

Eliminates previous language allowing surplus lines carriers to take out Citizens policies;
No longer increases a Citizens policyholder surcharge based upon Citizens policy growth;
Makes Citizens policyholders ineligible for renewal if private insurers offer premiums that are only slightly higher – starting at 5% higher in 2023 and climbing to 20% by 2026;
Eliminates previously proposed requirements on Citizens board member credentials and now prevents a registered lobbyist from serving on the board; and
Removes the definition of primary residence in the bill’s previous version that would have made a second home ineligible for the rating glidepath capped rate.

The Senate version of this bill, SB 186 by Senator Jeff Brandes (R-Pinellas), maintained the beef in the original bills plus further enhancements added in January, but never received a hearing in its last committee of reference. HB 1307 still awaits consideration by the full House. It is considered the closest thing to a companion bill to Senate Bill 1728 below on marketplace reforms. (Return to Top of Page)

Property Insurance – SB 1728 by Senator Jim Boyd (R-Bradenton) has the key provisions to stem Citizens explosive growth that HB 1307 above used to have but also attempts to clarify advertising and solicitation restrictions in last session’s SB 76 reform law that a federal judge enjoined from enforcement last summer on free-speech grounds. This bill would also allow insurance companies to offer homeowners (HO-3) policies covering actual cash value of roofs older than 10 years old, rather than currently required full replacement value, to reduce a cost-driver contributing to double-digit rate increases. That provision failed to be included in last year’s SB 76. There is no identical House companion to this bill, but it may be that parts of this bill end up being included in HB 1307 above.

The bill, which Senator Boyd described in mid-January as “another pass at property insurance reform, but nothing too aggressive,” didn’t have its first hearing until February 2 before the Senate Banking and Insurance Committee that Senator Boyd chairs. The bill clarifies the roofing solicitation reform from the last session by allowing advertising and solicitation but requires the contractor provide a statement to the homeowner, in large-print typeface, making it clear that:

The consumer is responsible for payment of any insurance deductible;
It is insurance fraud punishable as a felony of the third degree for a contractor to pay, waive, or rebate all or part of an insurance deductible applicable to payment to the contractor for repairs to property covered by a property insurance policy; and
It is insurance fraud punishable as a felony of the third degree to intentionally file an insurance claim containing any false, incomplete, or misleading information.

The other big component of the bill would allow insurance companies to once again offer homeowners policies that cover only the depreciated or actual cash value (ACV) of a roof, as opposed to full replacement, currently required under law for HO-3 policies. Companies who do so would use a roof-surface type replacement schedule but would have to continue to replace roofs under 10 years old, damaged by named hurricanes, or if the structure is declared a total loss. Stated-value policies would also be allowed. The bill also includes “commercial residential policies” to the requirement that new applicants are eligible for a Citizens policy only if an offer from a private insurance company is more than 20% higher than the Citizens premium for comparable coverage; likewise for existing Citizens commercial residential policyholders at renewal; and an exclusion from capped rates on second homes, just like SB 186 above.

The actual cash value (ACV) part of the bill received pushback at its second hearing on February 16 with some legislators expressing concern that limiting roof coverage to ACV would disproportionately hurt low-income and elderly homeowners. Senator Jason Brodeur (R-Lake Mary) countered that the actual cash value provision on roofs is needed, as too many insurance policies are being treated as home warranties instead.

Nevertheless, Senator Boyd filed a “strike all” or “delete all” amendment to replace the bill’s existing language, including ACV, which was approved on an 18-2 vote last Monday by the Senate Appropriations Committee. The amendment has the following provisions:

Roof advertisement disclosures: Requires “prohibited advertisements” to contain three disclosures informing the consumer of different acts of insurance fraud when deductibles are waived or incomplete information is provided to an insurer.
Mandatory Roof Deductible: This concept replaces the previously proposed Actual Cash Value (ACV) reimbursement schedule with a mandatory 2% of Coverage A roof deductible for claims except for total losses, hurricane damage, or a repair that doesn’t require replacement.
ACV Roof adjustment: If proof of payment of the roof deductible is not provided to the insurer, the roof claim will be adjusted according to ACV.
Citizens Depopulation: Would make a current Citizens Insurance policyholder ineligible for renewal unless a private insurance company take-out premium is more than 20% higher than the Citizens renewal premium. Because 99% of Citizens homeowners policies are priced less than the private market, this change is important to transfer risk to the private market that otherwise is subsidized by all Floridians.
Primary Residences definition: Confirms that only primary residences remain in the Citizens rate glide path cap.
Unsound Insurer rates: Requires policies assumed by Citizens be charged the higher of either the unsound insurer rate or Citizens’ rate.
Surplus Lines Takeouts: Allows surplus lines companies to participate in takeout programs when Citizens exceeds 700,000 policies.
Board and Executive Director experience: Requires certain board members and the head of Citizens have insurance experience.
Defense Costs: Insurers can be awarded defense costs if a suit is dismissed for failure to provide pre-suit notice.

Boyd urged the committee to approve the revamped bill, saying “our constituents are paying sums that most of them cannot afford to pay,” for their homeowners insurance. The same concern that had been expressed over the ACV in previous committee meetings was expressed over the deductible, but an amendment to remove it failed. The bill moved to the full Senate on Thursday, with Senator Boyd telling his colleagues that “if we do nothing…the market is going to collapse.” Amendments by opponents to remove the roof deductible and the defense costs provisions from the bill failed. The bill was fast-tracked and approved by an 18-11 vote, with 5 Democrats joining the Republican majority to support the bill, which now goes to the House.

However, it is frankly doubtful that the House will take up SB 1728 in these last five days of session. House Speaker Chris Sprowls told reporters Wednesday that although he’s evaluating various proposals, “I’m also cognizant of the fact that we just passed a very significant insurance bill last session. If what has been told to me in the eight years that I’ve been here from the insurance lobby is true, which is that it takes 18 months to see an impact in rates, which is what I’ve been told over and over and over again, then I don’t think we’re yet seeing the impact that we’re having in rates by the bill that we passed last year.”

While SB 1728 and HB 1307 above are fairly similar, the two glaring differences are allowing surplus lines companies to take policies out of Citizens Insurance and the roofing claim law changes – the Senate bill has them and the House bill doesn’t. There’s lots of differences to work out by session’s end this Friday, assuming there’s a good faith interest by Speaker Sprowls to do so. (Return to Top of Page)

Insurance Policies (Insurance Omnibus bill) – SB 468 and HB 503 by Senator Keith Perry (R-Gainesville) and Rep. Tommy Gregory (R-Sarasota) would, among the many provisions, redefine the term “covered policy” under the Florida Hurricane Catastrophe Fund in relation to certain collateral protection insurance policies; authorize insurers to file certain rating plans based on certain windstorm mitigation construction standards, if certain requirements are met; and relax rules on Citizens Property Insurance offering wind-only policies for condominium buildings, among other provisions.

Both bills were revised in January to tweak collateral protection provisions; change the workers’ comp provisions to require on-site audits only for policies with premiums greater than $10,000; allow a modeling indication that is the weighted or straight average of two or more hurricane loss projection models; clarify in Assignment of Benefits (AOB) agreements that the contractor provide the 10-day pre-lawsuit notice to the policyholder, insurance company and assignor; and loosen licensing requirements on agents selling motor vehicle service agreements and home warranty contracts.

SB 468 unanimously passed the full Senate on February 3 and includes a floor amendment that:

Re-inserted a previously deleted portion of the bill to allow an insurer to use an “independent, non-for-profit scientific research organization” to develop windstorm mitigation construction standards for personal lines residential rating plans;
Modified the term “Assignment Agreement” under Chapter 627.7152 to not include any instrument by which a licensed public adjuster as defined in s. 626.854(1) receives any compensation, payment, commission, fee, or other thing of value for providing services under such licensure;
Clarified that assignees of such agreements send their 10-day presuit notice to the insurance company to the name and mailing address or the email address designated by the company in the policy form;.
Reduced from 15 days to 10 days the timeframe insurance companies must give written notice to a policyholder with auto-payment of any premium increase of more than $10; and
Eliminated a provision requiring an insurance company sending policies electronically to remind the policyholder of their right to receive a paper copy of the policy.

Its House companion bill, HB 503 finally received its final committee hearing on February 23 before the Commerce Committee, passing unanimously. The House bill was amended to bring it into conformity with the SB 468 provisions noted above and clarified technical sections. It also added something not in the Senate bill: it defines a threshold of greater than 10% foreign ownership or control of an insurance company and makes those foreign parties subject to current requirements on identification and background checks.

HB 503 and SB 468 await scheduling for a vote by the full House. (Return to Top of Page)

Insolvent Insurers – HB 1023 and SB 1430 by Rep. Tom Fabricio (R-Miramar) and Senator Danny Burgess (R-Zephyrhills) amend several provisions of the Florida Insurance Code relating to the regulation and workings of our various backstop entities tasked with managing insolvent insurance companies. Specifically these bills would:

For the Florida Insurance Guaranty Association (FIGA): Authorize insurers to make advance assessment payments made to FIGA in quarterly installments; authorize an insurer to forego recouping advances of assessments to FIGA; and require insurers making assessment payments to FIGA to file reconciliation reports on a form and schedule adopted by FIGA regardless of assessment payment method.
For the Florida Workers’ Compensation Insurance Guaranty Association (FWCIGA): Provide that past loss experience and prospective loss experience for insolvent insurers must be used in the determination and fixing of workers’ compensation rates, and that data previously reported by insolvent insurers may be used to assess the impact on rates; authorize the Workers’ Compensation Insurance Guaranty Association (WCIGA) to allow an insurer to make advance assessment payments in a single payment or on a quarterly basis based on cash-flow needs; reduce the frequency of annual reconciliation reports subsequently filed with the WCIGA after the assessment year from a period of 3 years to a period of 2 years; clarify that an assessment paid before surcharges are collected is an advance; and make additional technical and conforming changes.

The Senate bill includes an amendment by Senator Jeff Brandes (R-Pinellas) that would allow officers and directors of insolvent carriers to serve as officers or directors of other carriers in the future, unless regulators found their actions contributed to or caused the insolvency. The Senate bill passed unanimously last Monday in its final hearing before the Appropriations Committee and was passed by the full Senate on March 1 and sent to the House. The House chose to set aside the Senate bill and instead passed the House bill unanimously and has sent it along to the Governor. (Return to Top of Page)

Property Insurer Reimbursements – HB 695 and SB 1058 by Rep. Cyndi Stevenson (R-St. Augustine)
and Senator Travis Hutson (R-Palm Coast) revise requirements for coverage under the Florida Hurricane Catastrophe Fund of certain policies assumed from “unsound insurers” by authorized insurers or Citizens Property Insurance Corporation. The bills would allow cat fund contract fund transfers when a company is in an “unsound condition” not just declared insolvent, making the funds available sooner. The Senate bill passed the full Senate on February 17 on a 36-2 vote and joined the House bill in awaiting consideration by the full House. The House last week set aside the House bill and unanimously passed the Senate bill instead, which contained an amendment clarifying that the homeowner be informed of any collateral protection insurance policy (i.e. forced place coverage) protecting both the borrower’s and lender’s financial interest under a lapsed homeowners policy. The bill now returns to the Senate for consideration. (Return to Top of Page)

Domestic Surplus Lines Insurers – HB 951 and SB 1402 by Rep. Tommy Gregory (R-Sarasota) and Senator Danny Burgess (R-Zephyrhills) changes the law governing surplus lines carriers, providing more options to consumers. It provides that the term “eligible surplus lines insurer” now includes domestic surplus lines insurers; authorizes specified non-admitted insurers to transact insurance as domestic surplus lines insurers; authorizes domestic surplus lines insurers to write surplus lines insurance in any jurisdiction; requires such insurers to be considered unauthorized insurers & non-admitted insurers for specified purposes; limits circumstances under which such insurers may write surplus lines insurance; and provides such policies are subject to specified taxes but are not subject to certain other taxes. The two comparable bills have had some opposition in committee meetings because of the lack of rates and forms regulation for surplus lines insurers, the lack of guaranteed claim payout protection under the Florida Insurance Guaranty Association (FIGA), and jurisdictional issues among various states’ laws governing surplus lines.

The House bill passed unanimously in its final hearing in the Commerce Committee on February 23 and still awaits a vote by the full House. It was amended to, among other things, clarify that a domestic surplus lines insurer is not an “authorized insurer” as defined in Fla. Statute 624.09 (1) and that the insurer is also prohibited from simultaneously holding any certificate of authority authorizing it to operate as an admitted insurer.

The Senate passed the Senate bill last Thursday on a 28-8 vote that included an amendment that:

Conforms the bill to the House version in clarifying that a surplus lines insurer is not an authorized insurer and is a nonadmitted insurer under the same definition as federal law;
Authorizes writing surplus lines insurance regardless of a company holding an existing certificate of authority;
Prohibits a domestic surplus lines carrier from issuing a homeowners policy for a Florida property within 12 months of an admitted carrier cancelling or nonrenewing the policy – the same restriction doesn’t apply if the policyholder cancels or nonrenews the policy; and
Requires a domestic surplus lines company maintain at least $15 million in surplus at all times.

SB 1402 now awaits action by the full House. (Return to Top of Page)

Department of Financial Services (DFS) – HB 959 and SB 1874 by Rep. Chip LaMarca (R-Broward) and Senator Jim Boyd (R-Bradenton) pertain to various administrative procedures, but tighten the rules on public adjusters; also included is that proposed change in the Department’s Legal Service of Process (LSOP) that alters when the “lawsuit notice of commencement clock starts.” According to the bills, “service of process is considered valid and binding at the time the process documents are received by, rather than sent to, the insurance company…and “when the process documents are made available on the DFS electronic system.” There are measures in these bills impacting insurance agents and workers’ compensation insurance, too. The bills prohibits compensation to a public adjuster based on amounts attributable to additional living expenses unless the public adjuster and the policyholder agree to such compensation in a separate agreement that includes a specified disclosure. The bills also:

Create a new provision which states that compensation paid to a public adjuster may not be increased based on a claim being resolved by litigation.
Require that adjusting firms seeking licensure include the name and license number of the designated primary adjuster who is responsible for adjusters at each business location, and requires fingerprints for background checks of the owner(s) as well as corporate officers and directors;
Require that an applicant for licensure as a public adjuster must have been licensed and appointed in Florida as a non-resident public adjuster, or as an all-lines adjuster, on a continual basis, during the six months prior to application;
Amend the definition of “public adjuster apprentice” to state that such apprentice must be employed by a public adjusting firm, rather than employed by a public adjuster;
Require that a $50,000 bond posted by each public adjuster apprentice remain in effect for one year after termination of the public adjuster apprentice license, and requires that the public adjusting firm provide DFS with notice of the primary adjuster who responsible for the supervision of all adjusters at the firm’s location;
Require that the $50,000 bond posted by each nonresident public adjuster must remain in effect for one year following the expiration or termination of the public adjuster license, and also makes changes to comply with federal law related to the use of fingerprints in national background checks, discussed above.

The bills also add an exemption to the examination requirement for the all-lines adjuster license; allow unaffiliated insurance agents to adjust claims without surrendering their appointments; clarify existing laws for title agents and agencies; and modify existing laws for public adjuster compensation, qualifications and bonding requirements. The Senate bill also limits public adjuster fees to recovery awards only and not attorney fee awards. In workers’ compensation insurance, the bills would revise statewide schedules of maximum reimbursement allowances (aka the Workers’ Comp Reimbursement Manual) for medically necessary treatment to exempt from the requirement that the legislature ratify rules with an adverse economic impact in excess of $1 million, along with other provisions.

The Senate bill unanimously passed the Appropriations Committee last Monday and was sent to the full House, where it was set aside in favor of the House bill, which had previously passed all of its committees. The House approved the bill unanimously and sent it to the Senate, which also approved it unanimously. It now heads to the Governor for consideration. (Return to Top of Page)

Fraud Prevention – HB 749 and SB 1292 by Rep. Chuck Clemons (R-Newberry) and Senator Joe Gruters (R-Sarasota) increase fines on public adjusters & public adjuster apprentices for certain violations under specified circumstances, including work performed during a state of emergency. The measures also require sellers to allow consumers to cancel in specified manners & by specified means service contracts with automatic renewal provisions. They also remove provisions relating to circumstances under which investigations are considered active; revise requirements for advertisements issued or caused to be issued by service agreement companies or salespersons; revise felony violations for which prosecutions must be commenced within specified timeframe; provide that certain insurers are entitled to specified expenses at trials & appellate courts; and create a $2,000 daily fine for insurance companies that fail to comply with a State Fire Marshall investigation. Both the House and Senate bills passed their respective first committees in mid-January, with the following provisions added to both bills:

Expanding the existing $10,000 fine for contractors or unlicensed persons acting on their behalf who solicit or incentivize a residential property owner to file a roof damage insurance claim or receive a paid referral from insurance proceeds to $20,000 if the violations occur during a declared state of emergency.
Entitling insurance companies that are victims of false and fraudulent insurance claims to recover investigation and litigation expenses, including attorney fees, when they have reported the possible fraud to the Department of Financial Services Division of Investigative and Forensic Services and the accused has been found guilty. This is in addition to having a cause of action in other cases to the recovery of compensatory damages, investigation and litigation expenses, including attorney fees that is already part of these bills.
Requiring service agreement companies and salespersons to disclose their full legal name during phone solicitations and radio/television and written advertisements.
A new section that requires development of a digital insurance verification system for licensed Florida motor vehicle drivers that can interface seamlessly to the Department of Highway Safety and Motor Vehicles’ digital driver’s license project already in process.

HB 749 passed unanimously in the full House on Wednesday and was sent to the Senate, which decided to set-aside SB 1292 and instead pass the House bill unanimously. It now heads to the Governor for consideration. (Return to Top of Page)

Hurricane Impact Programs – SB 578 and HB 837 by Senator Ed Hooper (R-Palm Harbor) and Rep. Matt Willhite (D-Wellington) would extend the state Division of Emergency Management’s hurricane loss mitigation program for 10 years. The Senate bill directs an appropriation of $10 million a year from the Florida Hurricane Catastrophe Fund that would fund 4 programs: tie-downs or mobile homes; wind resistance mitigation for homes; new construction and retrofits of public shelters; and continued hurricane research at Florida International University. Under an amendment offered by Senator Jeff Brandes (R-Pinellas) and approved by the Senate Banking and Insurance Committee on January 12, an additional $2 million each year from the Cat Fund would fund research by the University of South Florida School of Risk Management. The research would examine Florida’s property insurance market, analyze trends, and recommend polices for reducing property insurance rates, Citizens Property Insurance policy counts, and frequency of insurance litigation. The school would also be tasked with determining to what extent hurricane losses and rebuilding costs influence these trends. Unfortunately, the Senate bill sponsor, at its stop in the Community Affairs Committee, moved to delete the USF research provision. The bill now transfers administration and funding of the Manufactured Housing and Mobile Home Mitigation and Enhancement Program from Tallahassee Community College to Gulf Coast State College. HB 837 passed unanimously in the full House on Wednesday and was sent to the Senate, which decided to set-aside SB 578 and instead pass the House bill unanimously. It now heads to the Governor for consideration. (Return to Top of Page)

Mandatory Building Inspections – This bill is among several filed in the aftermath of the Champlain Towers South condominium collapse that killed 98 people in June of 2021. Although near the last of the group to be filed, legislative intelligence is such that all eyes in the condo communities and other stakeholders are on this bill as it appears it will be the “vehicle” for condo law changes in the 2022 session. SB 1702 by Senator Jennifer Bradley (R-Fleming Island) who Chairs the Community Affairs Committee would require multifamily residential building inspections statewide “to ensure that such buildings are safe for continued use.”

It would impose “milestone inspections” for buildings taller than three stories. Those within three miles of a coast would be structurally inspected on their 20^th anniversary and every seven years afterward; the rest on their 30^th anniversary and every 10 years afterward. All those buildings opened before July 1, 1992 would need to have initial inspections performed by Dec. 31, 2024. Inspections would have to be performed by architects or engineers that “have a minimum of 5 years’ experience designing primary structural components of buildings and a minimum 5 years’ experience inspecting structural components of existing buildings of a similar size, scope and type of construction.”

For condominium buildings or cooperatives, copies of inspection reports would be sent under seal to authorities and distributed to unit owners. The bill also requires the Florida Building Commission to further develop structural and life-safety standards for all building types and structures by the end of this year. The bill mirrors some of the suggestions in a joint report by The Florida Engineering Society and the American Council of Engineering Companies of Florida, one of two reports out so far in the aftermath of the tragedy. The bill allows local communities to establish even tighter standards.

At the bill’s first hearing in late January before her Senate Community Affairs Committee, Senator Bradley said Florida needs a minimum statewide standard so that another Champlain Towers collapse doesn’t happen again. ““We have half a million condo units in our state that are between 40 and 50 years old, more than 100,000 that are 50 years old or greater. And there is no requirement that they be inspected.”

The bill unanimously passed the Senate Rules Committee on February 23, its final stop before going before the full Senate. The bill was amended to include some of the provisions of SB 7042 below, to require condo associations conduct reserve studies to fund required building maintenance and repair. Although condo boards may waive the requirement, that decision would be part of the association’s official records. Condo boards would be allowed to assess owners for such repairs or borrow money to do so without a full vote of the owners. The bill has been retained on the Senate’s calendar for potential action and apparently remains the Senate leadership’s main vehicle for condo reform. (Return to Top of Page)

Community Association Building Safety – SPB 7042 by the Senate Regulated Industries Committee is substantially the same and includes the same milestone inspections as SB 1702 above, but included reserving requirements from the start so that high-rise condominium buildings can fund needed engineering studies, maintenance, and repair. The bill requires three-story or higher condo buildings conduct a reserve study every three years and that the condo board review its reserves annually for sufficiency, along with other very specific requirements. The bill includes an “alternative funding method” for a reserve account by means other than an assessment or special assessment of condo owners, including a line of credit and payments by developers offering units for sale. It also enhances the authority of the Department of Business and Professional Regulation’s Division of Florida Condominiums, Timeshares, and Mobile Homes. The bill also stresses mandatory building maintenance, requiring the association perform any required work identified by the developer until new maintenance protocols are obtained by a licensed professional engineer or architect. The bill amends Chapter 718 which is condo law and Chapter 719 which is HOA law.

At the bill’s first hearing on February 1, Senator Kathleen Passidomo (R-Naples) who is next in line to be Senate President, noted there are almost 1.6 million condos in Florida with nearly 106,000 that are at least 50 years old. “This problem is going to increase,” she warned the committee. There was limited public testimony and full Republican and Democrat support for the bill, which passed unanimously. The bill was never heard by the Senate Appropriations Committee, its final stop before going to the full Senate. Given that, and that SB 1702 above now contains some of the key reserving requirements of this bill, it appears that SB 1702 remains the Senate leadership’s main vehicle for condo reform. The legislature’s proposals were the subject of a Wall Street Journal article this past weekend.

The main vehicle for reform in the House is HB 7069 from the House Pandemics and Public Emergencies Committee. It was passed unanimously by the full House on February 24 and sent to the Senate, where it sits, awaiting consideration. It differs from both Senate bills by requiring structures within 3 miles from the coast receive a milestone inspection on their 25^th anniversary (rather than their 20^th anniversary as in the Senate versions in SB 7042 & SB 1702) and thereafter every 10 years (rather than seven years in the Senate versions). Both the House and Senate bills require those structures further than 3 miles from the coast to be inspected on their 30^th anniversary and every 10 years thereafter. There are also differences on reserve studies between the House and Senate bills, such as the House bill prohibiting condo boards from waiving reserve studies.

Committee Chairman Daniel Perez (R-Miami) who is leading the House bill, said the changes it requires are “long overdue” in “making sure that what happened on that day (in Surfside) never happens again,” he said. The bill requires that second inspections be conducted in the event that substantial damage is found and that if necessary repairs aren’t made, the “local building official must determine that the building is unsafe for human occupancy until such repairs are scheduled or begin,” according to the bill. The bill also addresses reserve requirements by condo associations, prohibiting them from waiving reserves for items that require inspection. (Return to Top of Page)

Construction Defect Claims – HB 583 and SB 736 by Rep. Clay Yarborough (R-Jacksonville) and Senator Travis Hutson (R-Palm Coast) would require a claimant to provide written reasons for rejecting a settlement offer to remedy a defect; authorizes a supplemental offer; provides notice requirements for a supplemental offer; requires a court to stay action under certain circumstances; limits attorney fees under certain circumstances; requires certain claimants to complete repairs of construction defect within a specified time; provides requirements for payment of repairs; requires an expert to examine defect & prepare report; provides report requirements; provides for compensation of expert; provides liability; and requires certain notices of construction defects be sent to mortgagee or assignee. One provision in the bills’ earlier versions would reduce the current statute of repose for filing a lawsuit over latent defects from 10 years, to a tiered-system of one to five years, depending on the structure, in the Senate bill and to seven years in the House bill. Supporters say the measures would protect builders from frivolous lawsuits and help control rising liability insurance costs. Opponents say it would limit consumer protection over latent defects. The Florida Home Builders Association has produced this short video that bears a shocking resemblance to the same tort issues facing our property insurance market.

The Senate bill contains specific timeframes for construction of improvements, occupancy, claims and counter-claims, and inspection requirements. The statute of repose would be five years for single- and multi-family homes not over two stories and keep the current 10-year repose for all other buildings. Dissenting Senators have argued in committee meetings that a five-year window was too little time for some defects, such as faulty foundations and faulty structural components in attics and load-bearing walls, to present themselves. An amendment was adopted February 10 before a Senate floor vote that would set a seven-year repose for all improvements but allow a 10-year repose when defects have been fraudulently concealed. The Senate passed the bill on February 17 on a 26-13 vote and sent it to the House for consideration.

The House bill reversed course at the February 8 meeting of the Regulatory Reform Subcommittee, which on an 11-5 vote, passed a committee substitute amendment that keeps in place Chapter 558 governing the alternative dispute process. It now reduces the current 10-year repose to seven years and changes the triggering event timeframe. For latent defects, the bill now calls for the clock to start 45 days after a certificate of occupancy is issued or the building permit closes, in place of current law that begins when the defect was or should have been discovered under due diligence. For material defects/violations, the bill now allows a 15-year state of repose, beginning under the same 45-day timeframe as latent defects, where it can be proven by clear and convincing evidence that the engineer, architect, or contractor knew about the violation during construction. The amended bill keeps the current four-year statute of limitations but moves to the 45-day timeframe above. Some at that committee meeting expressed their desire to return to previous version of the bill, which completely repealed Chapter 558. At its final committee stop before the Judiciary Committee on February 23, the bill was amended further to clarify timelines concerning defects discovered in common areas of homeowners or condominium associations. The latest bill analysis (pages 11-12) has the full changes to HB 583 that passed out of the House Judiciary Committee. The House bill still awaits consideration by the full House. (Return to Top of Page)

Building Inspection Services – HB 423 and SB 644 by Rep. Chip LaMarca (R-Lighthouse Point) and Senator Jason Brodeur (R-Lake Mary) revise eligibility requirements for a building code inspector or plans examiner; revise special conditions that may be imposed on provisional certificates; authorize partial completion of an internship program to be transferred between jurisdictions & private entities; limit the administrative fee that local jurisdiction can charge; provide certificate of occupancy or completion is automatically granted & issued; and require a local building official to provide written certificate of occupancy or completion within specified time.

The House passed HB 423 unanimously this past Friday and sent it to the Senate, which also passed it unanimously, setting aside its own SB 644. It now heads to the Governor for consideration. (Return to Top of Page)

Consumer Data Privacy – SB 1864 and HB 9 by Senator Jennifer Bradley (R-Fleming Island) and Rep. Fiona McFarland (R-Sarasota) would create the “Florida Privacy Protection Act”. It would require controllers that collect consumer personal information to provide certain information to the consumer and allow them to opt out of the sale and processing of their information by controllers. It also prohibits controllers from selling the personal information of consumers younger than 16 without their or (under 13) a parent’s consent. The House bill contains a private cause of action provision, something business interests are objecting to and that killed similar bills last session.

The House bill didn’t have its first hearing until February 10 (very late in session) and the Senate bill never received its first hearing. Highlights of the debate at the Feb. 10 House Commerce Committee (which passed the bill unanimously) saw business industry opponents warn of excessive costs of compliance and lawsuit traps, and sponsor Rep. McFarland saying that consumers value their privacy which comes with a cost of compliance. “This bill draws a line at the point where a company transitions from making money from me as the consumer and starts selling me to make money off of me,” McFarland said at the February 23 Judiciary Committee meeting.

The House passed HB 9 last Wednesday on a 103-8 vote and sent it to the Senate for consideration. Since the Senate bill never got a hearing, the Senate would need to waive its rules to take up this bill. Proposed amendments that would have created a 10 day “right to cure” period before being sued, allowing prevailing parties to recover attorney fees, and narrowing the focus of the bill on entities primarily involved in the business of buying and selling consumer data all failed to pass. The bill is a priority of the House Speaker. (Return to Top of Page)

Judicial Notice – SB 634 and HB 677 by Senator Jennifer Bradley (R-Fleming Island) and Rep. Will Robinson (R-Bradenton) would allow courts to accept images and other information taken from web mapping services, global satellite imaging sites, or Internet mapping tools (such as Google Maps) as evidence, so long as a date stamp is visible. The measures also provide for the authorizing parties to object to the admissibility of such information. The bills now include a provision addressing constitutional concerns related to criminal trials and specific elements of crimes that could not be proven without live testimony authenticating specific issues for criminal conviction. The Senate unanimously passed SB 634 on February 10 and sent it to the Florida House for consideration, which unanimously passed the bill this past Friday, setting aside its own HB 677. The bill now goes to the Governor for consideration. (Return to Top of Page)

COVID-19-related Claims – This is one of several bills addressing the ongoing coronavirus pandemic. SB 7014 from the Senate Judiciary Committee would extend current COVID-19 liability protections for health care providers for claims filed before June 1, 2023. The Senate passed the bill in mid-January on a 22-13 vote. The House was poised to take up its identical bill HB 7021 on February 9 but instead passed the Senate bill on an 87-31 vote. The Governor signed the bill into law on February 24. It extends COVID liability protections from the current expiration of March 29, 2022, to June 1, 2023. (Return to Top of Page)

Nutrient Application Rates – SB 1000 and HB 1291 by Senator Ben Albritton (R-Bartow) and Rep. Lawrence McClure (R-Hillsborough) is meant to control nutrient run-off pollution from farms into streams and rivers. The bills authorize agricultural producers to use specified recommendations to tailor nutrient application rates; require such producers to keep certain records & to enroll in & implement certain best management practices; require certain state universities & Florida College System institutions to recommend nutrient application rates, ranges, rate tailoring authorizations; and provide a presumption of compliance with certain requirements for agricultural producers using rate tailoring. The Senate unanimously passed SB 1000 on February 17 and sent it to the House, which took it up on first reading this past Friday and is scheduled to be considered further today (March 7). The House bill passed unanimously on February 23 in the State Affairs Committee has been awaiting full House consideration. (Return to Top of Page)

Statewide Flooding and Sea Level Rise Resilience – SB 1940 and HB 7053 by Senator Jason Brodeur (R-Lake Mary) and the House Environment, Agriculture & Flooding Subcommittee and Rep. Demi Busatta Cabrera (R-Miami) augment last year’s SB 1954 that created sea-level rise and flood resiliency efforts across the state up to $100 million a year. These bills do the following: Create the Statewide Office of Resilience and mandate a State Highway System resilience action plan. The bills also augment the Resilient Florida Grant Program and amend the statute outlining the University of South Florida’s Florida Flood Hub for Applied Research and Innovation. Lastly the bills seek to create a searchable database of flood elevation certificates. The House passed HB 7053 last Wednesday on a 114-1 vote and sent it to the Senate for consideration. The Senate bill has passed all of its committees and is pending before the full Senate.

In 2021, the Legislature passed Senate Bill 1954, which established several new programs and initiatives aimed at addressing the impacts of flooding and sea level rise on the state. To assist local governments in resilience planning, the bill created the Resilient Florida Grant Program (grant program), which authorized the Department of Environmental Protection (DEP) to provide grants to a city or county to fund the costs of community resilience planning. SB 1954 also directed DEP to develop a comprehensive flood vulnerability and sea level rise data set and conduct a vulnerability assessment based on the data set. In addition, the bill directed DEP to develop an annual Statewide Flooding and Sea Level Rise Resilience Plan (plan), which consists of a list of ranked projects submitted by cities and counties that address risks posed by flooding and sea level rise. The plan must propose $100 million in funding and be submitted to the Legislature for approval each year. Lastly, SB 1954 established the Florida Flood Hub for Applied Research and Innovation (hub). (Return to Top of Page)

Advanced Air Mobility – SB 728 and HB 1005 by Senator Gayle Harrell (R-Stuart) and the House Tourism, Infrastructure & Energy Subcommittee and Rep. Jason Fischer (R-Mandarin) are designed to pave the way to the future of “VTOL aircraft” – vertical takeoff and landing craft. Our regular readers may remember past stories on these type of aircraft coming to Florida with More Self-Driving & Flying Cars and Flying Cars Welcome at Miami Condo. The bills create the Advanced Air Mobility Study Task Force adjunct to the Department of Transportation and associated administrative details, including defining the term “VTOL aircraft” and creating a report for the Governor and Legislature on this exciting new mode of transportation that’s under continued development. The Senate unanimously passed SB 728 on February 23 and sent it to the House for consideration. HB 1005 has passed all its committee stops and is also awaiting consideration on the House floor. (Return to Top of Page)

You can use these links to view the latest legislative schedules for the Florida Senate and Florida House.

Motor Vehicle Glass – SB 484 by Senator Linda Stewart (D-Orlando) (there is no corresponding House Bill to date) targets Assignment of Benefits (AOB) abuse in the windshield repair industry, an effort that failed to gain traction last session. The bill would prohibit motor vehicle repair shops or their employees from offering anything of value to a customer in exchange for making an insurance claim for motor vehicle glass replacement or repair, including offers made through certain persons, etc. The bill still awaits its first hearing in the Banking and Insurance committee. (Return to Top of Page)

Powers of the Florida Building Commission – HB 771 and SB 1604 by Rep. Alex Andrade (R-Pensacola) and Senator Keith Perry (R-Gainesville) would require the Florida Building Commission to develop uniform standards for the maintenance and periodic inspection of existing building structures or facilities; provide requirements for such standards; and authorize the commission to adopt certain local rules that deviate from statewide standards. The House bill still awaits its first hearing in the Regulatory Reform Subcommittee. The Senate bill still awaits its first hearing in the Community Affairs Committee. (Return to Top of Page)

Condominium Associations – Another bill following the Surfside condo collapse, SB 880 by Senator Jason Pizzo (D-Miami) (there is no corresponding House Bill to date), would expand the jurisdiction of DBPR in investigating complaints about condo associations. It would also revise criminal penalties on acceptance of things or services of value or kickbacks, specify acts that comprise fraudulent voting activities relating to association elections, and require an association provide an itemized list and a sworn affidavit to persons requesting to inspect records. It still awaits its first hearing in the Regulated Industries Committee. (Return to Top of Page)

Motor Vehicle Insurance (PIP) – This is a perennial effort to do away with Personal Injury Protection (PIP) coverage under Florida’s No-Fault insurance law and replace it with bodily injury (BI) liability coverage. The primary difference between PIP and mandatory BI is that under PIP, someone injured in an auto accident seek coverage first under their own PIP policy, whereas under mandatory BI, someone injured in an auto accident would seek recovery from a responsible third-party’s (other driver’s) BI coverage.

While the legislature did pass a bill in the 2021 session, the Governor vetoed it, out of concern it could raise auto insurance rates and lead to more uninsured drivers on the road. This session, SB 150 and HB 1525 by Senators Danny Burgess (R-Zephyrhills) and Darryl Rouson (D-St. Petersburg) and Rep. Erin Grall (R-Vero Beach) are making another attempt at repealing PIP. The Senate bill has third-party bad faith reform and the House bill doesn’t – something that’s been a deal-breaker in the past. Many in the insurance industry insist that PIP repeal without bad faith reform will not reduce costs to motorists.

This session’s bills have each seen just one committee meeting and will see no more, with the effort now widely viewed as dead again for this year, as the Governor reportedly has made it clear to House Speaker Sprowls and Senate President Simpson not to send a PIP Repeal bill to him this session. Highlights of the debate include Senator Jeff Brandes (R-Pinellas) calling the effort “legislative malpractice” without an updated study showing repeal will actually save motorists money as the sponsors claim, and House sponsor Rep. Grall in retort calling it “agency malpractice” for the Florida Office of Insurance Regulation to have released its latest study that showed rates would increase – after the legislature passed and before the Governor vetoed last year’s law. (Return to Top of Page)

Communicable and Infectious Diseases – Citing this act as the “Sergeant Justin White Act,” SB 774 and HB 117 by Senator Joe Gruters (R-Sarasota) and Rep. Elizabeth Fetterhoff (R-Deland) and Rep. Anika Omphroy (D-Lauderdale Lakes), the bills provide a presumption to specified workers that an impairment of health caused by COVID-19 or an infectious disease happened in the line of duty. They require certain actions in order to be entitled to the presumption and require emergency rescue or public safety workers to file an incident or accident report under certain conditions. The Senate bill still awaits its first hearing before the Governmental Oversight and Accountability Committee. The House bill still awaits its first hearing before the Government Operations Subcommittee. (Return to Top of Page)

Insurance Coverage for At-home COVID-19 Test Kits – SB 328 and H 129 by Senator Ana Maria Rodriguez (R-Miami-Dade) and Rep. Ardian Zika (R-Pasco) define the term “at-home COVID-19 test kit”; require health insurers and health maintenance organizations to provide 100 percent coverage for at-home COVID-19 test kits; and provide for expiration of the insurance coverage, among other provisions. The Senate bill still awaits its first hearing in the Banking and Insurance committee. The House bill still awaits its first hearing in the Finance & Facilities Subcommittee. (Return to Top of Page)

Telehealth – SB 312 and HB 17 by Senator Manny Diaz (R-Hialeah) and Rep. Tom Fabricio (R-Miramar) and Rep. Mike Giallombardo (R-Cape Coral) revise the definition of the term “telehealth” and narrow the prohibition on prescribing controlled substances through telehealth to include only specified controlled substances. The Senate bill was passed unanimously by the full Senate on January 27 and was scheduled to be considered by the full House on February 9 along with the House bill, but was temporarily postponed. The only difference in the bills at this point is that the Senate version strikes a current prohibition on audio-only devices in telehealth visits, while the House version keeps the prohibition in place. Both bills were considered by the full House last week which decided to lay the House bill aside and unanimously approved the Senate bill, but with an amendment that keeps the current prohibition on audio-only telehealth visits. The bill now heads back to the Senate for consideration. (Return to Top of Page)

Veterinary Telehealth – SB 448 and HB 723 by Senator Jason Brodeur (R-Lake Mary) and Rep. James Buchanan (R-Sarasota) and Rep. Kristen Arrington (D-Osceola) would provide a framework for veterinary telemedicine. The measures generally authorize prescription of controlled substances under specified circumstances; revise grounds for disciplinary action against a veterinarian; and provide a supervising veterinarian assumes responsibility for person working under or at his or her supervision, among other provisions. The Senate bill was temporarily postponed twice from committee consideration in January and was not received on February 10 by the Agriculture Committee where it was scheduled to be heard. The full House unanimously passed HB 723 on February 10 and sent it to the Senate for consideration, where it has received no action to date. It appears the veterinary association and its members are still struggling with the balance between live visits and telehealth visits. Behind the scenes there are those who believe that telehealth visits are not as financially viable as office visits because veterinarians routinely recommend prescriptions during office visits and the pet owner may not be as engaged to buy those prescriptions from the veterinarian in a telehealth visit, opting to buy pet drugs online, often less expensively. If our readers are like me, the loyalty to our pet’s veterinarian is unwavering and we spend more on our pets than our mortgage! (Return to Top of Page)

Sales Tax Refunds for Building Mitigation Retrofit Improvements – HB 863 and SB 1250 by Rep. Nick DiCeglie (R-Pinellas) and Senator Joe Gruters (R-Sarasota) would create a sales & use tax refund for homeowners who purchase building materials used for mitigation retrofit improvements, along with regulation of mitigation inspectors. This would be a win-win for Florida homeowners, to encourage them to fortify their homes and help save on future insurance premiums. The House bill still awaits its first hearing in the Regulatory Reform Subcommittee; the Senate bill its first hearing in the Community Affairs Committee. (Return to Top of Page)

Community Association Database – HB 329 and SB 642 by Rep. Nicholas Duran (D-Miami-Dade) and Senator Ana Maria Rodriguez (R-Miami-Dade) require the Department of Business and Professional Regulation (DBPR) to establish a searchable database of condominium and homeowners’ associations’ information. This would include contact information of board members, community managers, articles of incorporation and the like, but also a copy of the annual budget and schedule of expenses and assessments. It must specify whether the association has reserve accounts for capital expenditures and deferred maintenance, and if they are fully funded. A copy of the most recent reserve study, if one has been conducted, would also be included in the database. The Senate bill has not been heard and may not be, given creation of SB 7042 above in late January. The House bill still awaits its first hearing in the House Regulatory Reform Subcommittee. (Return to Top of Page)

LMA Newsletter of 3-7-22