How to file annual report with state
Q: I am new on the board of directors. In reading the minute book, it refers to the annual report, which is a state filing. What is this and how do we file?
A: Each year the association must file an annual report with the state. Failure to file will invalidate your corporation. The report is due by May 1. Annual reports filed after then will be assessed a $400 late fee, which cannot be waived. If the report is filed by May 1, the report filing fee is $150 for a for-profit corporation (plus $8.75 for a certificate of status), $61.25 for a not-for-profit corporation (plus $8.75 for a certificate of status).
Information online at www.sunbiz.org will explain the simple form to fill out. You can pay online and complete the form in five minutes or so. You will need a reliable person to serve as registered agent. The registered agent is the person designated to accept service of process on behalf of your business entity.
The registered agent must have a physical/street address in Florida. I suggest that you have your attorney, CPA or a management company to serve as your registered agent.
Flood insurance benefits everyone
Q: You suggest our association should carry flood insurance. Why should all the members be require to pay for insurance for a few owners that have mortgages? It costs $100,000 a year for the coverage.
A: It is a cost of doing business. Many owners fail to understand that if one unit is devalued, all units will lose value.
You are a collective and the devaluation of one unit will affect all other units. The board and members have a responsibility to keep values of the homes and unit on par with comparable homes.
In a high-rise building, if a first floor unit is flooded and is destroyed, chances are that the units above may be declared as uninhabitable.
See documents on borrowing, lending
Q: Does the board have a right to pay an employee in advance? We have been told that the board cannot use our funds for this action.
A: Read your articles and see if they allow the board to borrow and lend money. This is a document question but is covered in FS 617.0302:
(7) "Make contracts and incur liabilities, borrow money at such rates of interest as the corporation may determine, issue its notes, bonds, and other obligations, and secure any of its obligations by mortgage and pledge of all or any of its property, franchises, or income."
But look at the situation from another position. Is the employee reliable? Would you want to fire or replace the worker? The answers would determine if the employee is worth the effort to help in a time of need.
Richard White is a licensed community associations manager. Write to him at 6039 Cypress Gardens Blvd., No. 201, Winter Haven, FL 33884-4115. Please include your name and city.