Over the past few weeks, we have received a number of calls from board members, managers, and homeowners asking about a bill moving through the Florida Legislature that would allow homeowners to dissolve their HOA.
The attention is understandable. The bill recently passed the Florida House of Representatives by a vote of 108 to 2, which signals strong support in the House. At the time of this writing, however, we are not aware of a companion bill that has moved forward in the Florida Senate. That means the proposal has not yet become law, although clearing the House is certainly a major step in the legislative process.
A lot of what people have asked us is whether an HOA could be dissolved with a simple majority vote of the members. That description is not exactly accurate, especially after the latest changes to the proposed language. After reviewing the bill analysis issued by the House Commerce Committee on March 3, the process is much more involved than the headlines suggest.
The proposed law would allow owners to initiate dissolution only after submitting a petition signed by at least fifty percent of the voting interests in the association. Importantly, that petition does not dissolve the HOA. It only forces the board to call a membership meeting to consider a plan of termination.
That plan must explain how the community will function if the HOA is dissolved, including what happens to common areas, association property, and other assets. In many communities this raises obvious questions. HOAs often maintain stormwater systems, private roads, entrances, and other infrastructure. Those responsibilities do not disappear simply because the HOA does.
Even if the process begins, the termination plan must be approved by two thirds of the entire community, not just those attending a meeting. For most communities, achieving that level of agreement would be very difficult.
Perhaps one of the most overlooked aspects is that even if the community reaches the required vote, the plan must still be submitted to a court for review. The court examines whether the statutory procedures were followed and whether the plan meets the requirements of the law.
If approved, the plan is recorded and a termination trustee is appointed to wind down the affairs of the association and handle its remaining property and obligations.
In other words, dissolving an HOA would not be a single vote. It would be a legal process involving planning, community consensus, and court oversight.
The intent of the bill appears to be giving homeowners a mechanism to hold dysfunctional boards accountable. However, the complexity of the process means that legal involvement will almost certainly follow.
In practice, this may lead to increased legal costs for both sides. Disgruntled owners may hire counsel to pursue dissolution, while boards will need attorneys to defend the association’s interests and guide the process.
Homeowners pursuing dissolution will likely need assistance preparing a compliant termination plan and navigating the statutory procedures. Associations facing a petition will need counsel to review the request, advise the board, and ensure the association responds properly.
In practice, this may lead to increased legal costs for both sides. Disgruntled owners may hire counsel to pursue dissolution, while boards will need attorneys to defend the association’s interests and guide the process. Even when homeowners attempt to start the process on their own, the association will often still need legal guidance to evaluate the petition and determine the next steps.
This is one reason why many communities are speaking with a Florida real estate lawyer or a homeowners association lawyer now to better understand how the proposed legislation could affect them.
The bill still has additional legislative steps before it could become law. But based on the current version, the idea that an HOA could disappear overnight with a simple majority vote is simply not the case. As always, our team of attorneys will monitor the progress and communicate with local legislators for the latest!
