Mandated Requirements – JB Status

Factual response to the Jupiter Bay Board's 4/19/24 Concrete Remediation Letter.

This webpage addresses significant points of the Board's letter as well as other statute requirements. These include project cost, mandated remediation, Association requirements to address new inspection and reserve mandates, Association's progress, and questions regarding East C remediation.

Project Cost

Prior to reviewing the Board’s progress, or lack thereof, in addressing the new Florida statute requirements, Association Members should understand the potential cost of the Board’s actions and resulting financial commitments.

  1. Out of the 5 bids received for repair of the East C building, Daniello was chosen as the least expensive at $857,555. According to the Board’s 4/19 letter, this can be funded through use of all East Building’s Restoration Reserves through yearend 2024 plus a special assessment of approximately $2,200 from each East unit owner.
  1. The Board did not mention that Swaysland’s East C Report said that “You can expect that there will be extra work and extra charges above and beyond the original contract price or estimate. These extras usually amount to about 25% or more of the original cost estimate but can be more depending on the severity of the deterioration. However, there have been instances where the cost of a concrete repair project has been double or triple the estimate even through a competent investigation was made.”
  1. The Board’s Letter did say that “This same project one year from now will likely be around $1,500,000.” Assuming that other East building remediation will begin next year, the Board is saying that the cost could likely be $1.5 million per building assuming similar damage. With 2 other East buildings to address plus a third East building 2/5 the size of the others, this would cost $3.6 million or $26,667 special assessment per owner. This assumes similar costs as East C remediation with very few change orders and very little additional inflation.
  1. Swayswand’s Report also said that “Concrete deterioration is an on-going process and will not be corrected by a single repair program. You should be prepared to make additional repairs and paint within the next seven (7) to ten (10) years.”
  1. There should be no urgency in committing to spend this much money when the Association has 365 days to begin addressing any “substantial structural deterioration” of which none has been found so far. It is more important to complete milestone inspections and the structural reserve study first to understand the entire project scope and cost.
  1. Jupiter Bay unit Owners in the older West buildings, which according to our insurers are not as well constructed as the East buildings, can expect similarly large special assessments.
  1. These costs may need to be disclosed to any future buyer of a Jupiter Bay condominium. New disclosure requirements are addressed in Florida Statute 718.503(2).
  1. Costs presented in the Board’s letter and reviewed here are based on the interpretation of statute requirements from this Board and a vendor (Swaysland’s VP of Engineering). Different interpretations (see below) of the statutes could significantly reduce costs.

Mandated Inspection Levels & Remediation Requirements

  1. The differences between mandated and optional remediation requirements need to be addressed.
  1. As the Board’s letter accurately states: "Substantial structural deterioration" means substantial structural distress that negatively affects a building's general structural condition and integrity. The term does not include surface imperfections such as cracks, distortion, sagging, deflections, misalignment, signs of leakage, or peeling of finishes unless the licensed engineer or architect performing the phase I or phase II inspection determines that such surface imperfections are a sign of substantial structural deterioration.
    1. The laws say that if a Phase I inspection finds “substantial structural deterioration”, then a Phase II inspection must be performed. Neither the 2020 Swaysland East buildings nor the recent East C building inspection reports identify any “severe” structural deterioration nor recommend a Phase II inspection. Yet Swaysland's VP of Engineering says (per the Board’s letter):
      • “There is enough concrete deterioration present to perform a comprehensive concrete repair project.”
      • “We consider the concrete spalling located at the [East C] building to be substantial structural damage.”
      • “All the concrete spalling located at the building needs to be fixed. That would include even spalls on minor units.”
  1. Maybe Swaysland's VP has not read his engineers' reports. Also, nothing in the statutes say that minor spalling needs to be addressed. In fact, the statute says that “surface imperfections such as cracks, distortion, sagging, deflections, misalignment, signs of leakage, or peeling of finishes” are not considered substantial.
  1. Statute 553.899 says that repairs for substantial structural deterioration must be commenced within 365 days after receiving a Phase II inspection report. The Association has not received a Phase II inspection report for the East C building, yet a decision was made to begin remediation next month (May, 2024).
  1. Are there compelling reasons why this building was chosen over other East buildings, particularly over the East B building where more spalling issues were documented in Swaysland's 2020 inspection report?
  1. Wouldn’t it be more prudent for the Association to meet statute requirements more fully by addressing those building columns (stacks) across the A, B and C East buildings where the most damage was found?
  1. Over the past 17 years the Association spent $2.8 million on building restoration/spalling, including $491,000 in the East. Our process has always been to address new spalling issues each year as they are discovered.
  1. With new requirements and corresponding recent inspections, building remediations need to be addressed more aggressively; however, utilizing this many resources and expense for one building at this time seems excessive, even if it’s the Board President’s building. While addressing building C, the other East buildings are not getting the attention they require for remediating their concrete damage, and there are concerns that money to address their repairs may not be available. What if new legislation to reduce remediation requirements is passed before the other buildings are repaired?
  1. This project needs to be planned as a multi-year endeavor, as was done in the past, where several new building stacks are addressed each year until all are repaired. At which point the Association will probably need to start back at the beginning. Repairing all buildings at the same time means that they may all deteriorate at once creating a huge future expense in the same time period.

Questions Regarding East C Remediation

  1. Will all owner-installed balcony modifications be removed at the Association’s expense? Will owners be allowed to have them reinstalled?
  1. 36 units showed tile flooring on the balconies.  The bids did not estimate the cost for tile removal. Is the cost being charged back to the unit owners?
  1. What will be the patio floor finish? What if the owner would like stamped concrete, which is an approved finish?
  1. What about the units that have had their frames and screens recently replaced?
  1. If a sliding glass door needs to be removed, can they be reinstalled without upgrading to hurricane glass. If upgraded, will the cost be charged back to the homeowner?
  1. The Swaysland Report says that the building will be pressure washed, primed, and painted with a 10-year warranty wind-driven warranty finish coat. What all will be painted? What about color matches with already-painted balconies?
  1. The Swaysland Report says: “install new perimeter sealant exterior doors and windows.” What doors and windows?

Association Requirements to Address New Inspection Mandates

As stated in the email which you received, the Association is required to complete two tasks before December 31, 2024:

    1. Perform an initial milestone inspection, and
    2. Have a structural integrity reserve study completed.
The Board has provided little or no information on milestone inspection requirements or plans:
  1. Florida statutes require that within 14 days after being notified by local enforcement agencies of required inspections, the association must notify unit owners of the required milestone inspections and completion dates. This has not happened unless that was the purpose of the Board’s April 19th Letter.
  1. The milestone inspection notice may be given by electronic submission to unit owners who consent to receive notice by electronic submission or by posting on the association’s website. Within 45 days after receiving a phase one or phase two milestone inspection report, the association must distribute a copy of the inspector-prepared summary of the inspection report to each unit owner by United States mail or personal delivery, must post a copy of the inspector-prepared summary in a conspicuous place on the condominium property, and must publish the full report and inspector-prepared summary on the association’s website.
  1. Is the inspection of East C building a part of an “initial milestone inspection” even though the report describes it as a “Concrete Restoration Inspection Report”? The report says that private balconies, public walkways, and the building exterior were inspected.
  1. According to FL statutes 553.899 and 627.706, the purpose of a milestone inspection is to uncover “substantial structural deterioration” which “negatively affects a building’s general structural condition and integrity.” It includes inspection of:
    • Interior floor displacement or deflection,
    • Foundation displacement or deflection,
    • Damage that results in listing, leaning, or buckling of the exterior load-bearing walls, and
    • Damage causing the building to be significantly likely to imminently collapse because of movement or instability of the ground supporting the building.

Do the Swaysland inspections include these milestone inspection requirements?

  1. An engineering firm reportedly told another local condominium association that since they had just their patios and catwalks inspected (by another firm), their entire inspection needed to be redone to qualify as a milestone inspection.
  1. The Board’s letter says that “A and B East are currently being inspected as part of the ongoing milestone inspection” and that “the remaining buildings, not already inspected, will have their inspections completed by August.” Will these inspections be part of an overall milestone inspection which includes the 6 West buildings?
  1. FL statutes say that “If the officers or directors of an association willfully and knowingly fail to have a milestone inspection performed pursuant to s. 553.899, such failure is a breach of the officers’ and directors’ fiduciary relationship to the unit owners under s. 718.111(1)(a).”

House Committee Contributions

  1. The House Committee is an advisory committee with no authority to make Board decisions.
  1. Decisions such as those mentioned in the Board’s April 19th letter must be made by the Board of Directors at official properly noticed Board meetings allowing for owner input and discussions, including:
    1. Which buildings to inspect and in what order,
    2. The construction company to do the building remediations,
    3. The order in which buildings and stacks are addressed,
    4. The amount of repair work to do in each building, and
    5. Special assessments to pay for the repairs.
  1. The House Committee did meet on several occasions where this project was discussed. Committee members reviewed 5 contractor proposals on April 9 and selected Daniello, Salazar and Sons for East C concrete remediation based on the cost per unit of various project components. Committee members didn’t know exactly what the contractors were bidding on since the Swaysland East C Inspection Report wasn’t provided to the members until two days later (it was completed on January 24th).
  1. At a prior (March 12th) House Committee meeting a member was told to quit asking so many questions regarding vendor proposals.
  1. Regarding the Board letter’s comment on the availability of meeting minutes on the Association’s website, it should be noted that as of Saturday, April 20th all 2024 Board Meeting minutes are missing as are the House Committee minutes of March 12th and April 9th.
  1. The Board cannot authorize work to be performed without knowing how they are going to pay for it. If a special assessment is required, it must be calculated and announced to unit owners two weeks prior to it being voted on at a Board Meeting. The East C Remediation Project is currently awaiting funding.

Association Requirements to Address New Reserve Mandates

The Board has provided no information on Reserve Study requirements or plans.
  1. As reported earlier, recent Florida legislation requires the Association to complete a Reserve Study by the end of this year (2024).
  1. The study is to include at a minimum, a study of the following items as related to the structural integrity and safety of the building:
    1. Roof.
    2. Structure, including load-bearing walls and other primary structural members and primary structural systems as those terms are defined in s. 627.706.
    3. Fireproofing and fire protection systems.
    4. Plumbing.
    5. Electrical systems.
    6. Waterproofing and exterior painting.
    7. Windows and exterior doors.
    8. Any other item that has a deferred maintenance expense or replacement cost over $10,000.
  1. The study is to:
    1. State the estimated remaining useful life of each identified item, and
    2. Provide the estimated replacement cost.
  1. The reserve study will likely increase the replacement cost and annual contributions for most current reserve accounts. It will also add many items to our current reserve schedule. The combination of these could double our current contribution resulting in $407 added to every owner’s quarterly assessment.
  1. Results of the reserve study must be included in the association’s annual reserve schedule, and results must be reflected in the association’s annual budget, starting in 2025, and in next year’s quarterly maintenance assessment fees. Reserve study results will need to be available within 5 months in order to be included in the 2025 budget.
  1. Reserves must be fully funded, and association members are not permitted to vote to waive or partially fund the reserves.
  1. It is a breach of a Board member or officer’s fiduciary duty if an association fails to complete a structural integrity reserve study. Furthermore, it could impact officer D&O insurance and property insurance premiums.

Further Information

The complete text of Florida statutes addressing the required "milestone structural inspections" and "structural integrity reserve study" can be reviewed via the following link: "Inspections".