A special assessment is the most disruptive thing a board does in an ordinary year. The law governing it is short, but it is unforgiving on process, and almost every assessment that has to be rescinded and re-levied failed on notice or on the purpose statement rather than on the underlying decision. Planning one properly means settling the amount, the contingency, the payment terms and the message to owners before the 14-day notice is mailed, not after.
Decide what the money is for before you decide how much
A special assessment is a levy outside the annual budget, raised for a purpose the budget does not fund. The purpose drives everything that follows: the notice language, the vote, the accounting, and what happens to money left over. So the board's first task is not a number. It is a written statement of scope, usually taken straight from an engineer's report, a bid package, or an insurance adjustment.
Boards get into trouble when the purpose is written after the number. If the treasurer works out that the association needs $900,000 and the notice then calls the purpose "building repairs," the association has a vague authorization and a real risk that some of the spending falls outside it. Write the scope first, price it, and let the notice describe what it is.
Ask also whether a special assessment is the right instrument. Reserves already funded for the component may cover part of the work, and a condominium that has completed a milestone inspection may borrow for milestone or Structural Integrity Reserve Study capital work on a vote of a majority of the total voting interests, spreading the cost over years instead of quarters. Our guide to annual budget planning covers the reserve side, and the chapter guide on regular versus special assessments explains where the line falls.
Setting the amount and the contingency
The number has four parts: hard cost, professional fees, soft costs and contingency. Boards routinely assess the first and forget the other three, then come back for a second assessment eight months later, which is the most damaging thing a board can do to its credibility with owners.
- Hard cost. The bid or bids for the work itself. Use the bid, not the engineer's early estimate, if you have bids in hand.
- Professional fees. Engineering design, construction administration, permitting, testing, threshold inspection where required, and legal fees for the contract.
- Soft costs. Permits, owner relocation or access costs, temporary protection, dumpsters, storage, and management time billed outside the base fee.
- Contingency. A percentage carried for the unknown. On restoration and structural work where concrete will be opened up, engineers recommend a far larger contingency than on a straightforward replacement, because nobody knows what is behind the stucco until it is off.
- Collection shortfall. If the association has a delinquency rate of five percent, an assessment levied at exactly the project cost will not fund the project.
Tell owners the figure includes a contingency and what it is for. A contingency that is disclosed reads as competence. One that is discovered later reads as padding.
The notice each chapter requires
The 14-day rule is the same across all three chapters, and it is the rule boards most often shorten. Fourteen days before the meeting means fourteen days, counted back from the meeting date, with the notice both sent to owners and posted on the property.
| Condominium | HOA | Cooperative | |
|---|---|---|---|
| Advance notice of the meeting | 14 days | 14 days | 14 days |
| Authority | § 718.112(2)(c)1. | § 720.303(2)(c)2. | § 719.106(1)(c) |
| How it is given | Mailed, delivered or electronically transmitted to owners and posted conspicuously on the condominium property | Mailed, delivered or electronically transmitted to members and parcel owners and posted conspicuously on the property or broadcast on closed-circuit cable television | Mailed, delivered or electronically transmitted to unit owners and posted conspicuously on the cooperative property |
| What the notice must say about the assessment | That assessments will be considered, plus the estimated cost and a description of the purposes | That assessments will be considered and the nature of the assessments | Statute requires the 14-day notice; content requirements come from the bylaws |
| Restriction on how the money may be spent | Only for the specific purpose or purposes set forth in the notice, § 718.116(10) | No statutory restriction in Chapter 720; look to the declaration | Only for the specific purpose or purposes set forth in the notice, or returned to owners, § 719.108(9) |
| Excess funds | Common surplus on completion; refund or credit at the board's discretion, § 718.116(10) | No statutory rule; look to the declaration | Returned to unit owners under § 719.108(9) |
The content requirement is where condominium and HOA practice diverge. A condominium notice saying only "special assessment to be considered" does not satisfy the statute, which asks for the estimated cost and a description of the purposes. An HOA notice must state the nature of the assessment. In both cases, put the dollar figure, the per-unit or per-parcel allocation, the purpose and the payment schedule in the notice itself rather than a cover letter, because the notice is what will be produced if the assessment is challenged.
Keep proof: the mailing list used, the affidavit of mailing, a dated photograph of the posted notice, and the transmission log for owners who consented to electronic notice. The notice and agenda rules for ordinary board meetings apply here too, on top of the 14-day requirement.
Who votes, and on what
In most Florida communities the board levies the special assessment and the owners do not vote at all. The board's authority comes from the declaration and bylaws, and the 14-day notice exists precisely because the decision is the board's. This is document-specific, so settle it with counsel before the notice goes out.
Read your declaration for three things. First, whether the board may levy a special assessment without an owner vote at all. Second, whether there is a dollar or percentage ceiling above which an owner vote is required. Third, what vote that is: a majority of those present at a quorate meeting is a very different threshold from a majority of the total voting interests, and the difference has sunk more than one assessment.
Two related votes are confused with the assessment vote. A material alteration or substantial addition to condominium common elements requires 75 percent of the total voting interests unless the declaration provides a different procedure, and that vote is about the work, not the money. Using reserve funds for a purpose other than the one they were collected for requires its own approval, a majority of the total voting interests in a condominium and a majority vote at a quorate meeting in an HOA. A board that levies an assessment for work it is not authorized to perform has solved the wrong problem.
Then record the vote properly. The minutes should show the notice given, the quorum, the motion with the dollar amount and the purpose, the payment schedule, the vote count, and the board's stated reasons.
Payment options and instalments
No chapter requires a board to let owners pay a special assessment in instalments, and no chapter forbids it. The board decides, and the decision should be made and announced at the same meeting the assessment is levied, so that owners see one complete plan rather than a number followed by a month of uncertainty.
- Match the payment schedule to the draw schedule. If the contractor is paid over ten months, collecting the whole assessment in 30 days creates a large idle balance and a lot of owner anger. Collecting too slowly creates a funding gap the association has to bridge.
- State the due dates precisely in the notice and in the levy: the amount of each instalment and the calendar date each is due.
- Say explicitly what happens if an instalment is missed. Most boards accelerate the balance on default. If yours does, the acceleration must be authorized by the documents and stated up front.
- Decide whether a discount for payment in full is allowed under your documents before offering one. Many declarations require assessments to be levied in proportional shares, which constrains discounting.
- Apply the same rules to everyone. A special assessment instalment that is missed is a delinquent assessment, and it goes through the same statutory notice sequence as any other, applied through your written collection policy.
Owners in genuine hardship will ask for individual terms. Handle those requests through the policy and the delegation the board has already adopted, not by informal accommodation at the table.
Surplus, shortfall and the accounting
Track special assessment funds in their own general ledger account, separate from operating funds and reserves, from the first dollar collected. That is partly legal, since condominium and cooperative money may be used only for the stated purpose, and partly practical: at the end of the project the board has to show owners what came in and what went out.
When the stated purpose is complete, a condominium's excess funds become common surplus, and the board may either return them to unit owners or credit them toward future assessments. That is a board decision, not an owner vote. The cooperative statute speaks of funds being used for the stated purpose or returned to unit owners. Chapter 720 is silent, so the HOA answer comes from the declaration. Read it before promising owners a refund.
A shortfall is harder. If the project runs over and the contingency is exhausted, the board is back at the beginning: a new decision, a new 14-day notice, a new purpose statement. Ask counsel at the same time whether the overrun is a change order the association must absorb or a contract claim it should pursue, a question our guide to major expenditure diligence takes up.
Closings, estoppel certificates and lender reaction
A special assessment changes what the association must say when a unit or parcel sells. The association has 10 business days after a written or electronic request to issue an estoppel certificate in all three chapters, and the certificate must disclose the assessment, including amounts not yet due. An estoppel that omits a levied but unbilled special assessment is the classic source of a post-closing fight between a buyer, a seller and the association.
Decide, and write down, how the assessment will be described on estoppels before the first request arrives: the total per unit, the instalments paid, the instalments outstanding, and the due dates. Give that language to whoever prepares estoppels. A condominium purchaser is jointly and severally liable with the previous owner for unpaid assessments that came due up to the time of transfer of title, which makes accuracy on the certificate a matter of real money.
Expect lenders and buyers to react. Secondary-market project reviews look closely at pending special assessments, deferred maintenance and structural inspection findings, and an association in the middle of a large assessment may find resale financing slows. The best defense is documentation: a clear scope, a funded plan, a schedule, and minutes showing the board acted on professional advice. A project that looks planned is treated very differently from one that looks reactive.
Telling owners before the notice goes out
The legal notice is not the communication plan. By the time a 14-day notice arrives, owners should already know the problem exists, roughly what it will cost, and why the board is acting now. A special assessment that arrives as a surprise produces recall petitions; the same assessment, after three months of reporting, usually produces grumbling and payment.
A workable sequence: report the engineering finding when it comes in, hold an open information meeting with the engineer present, publish the bid results and the funding options side by side, then notice the meeting at which the board will act. Keep every version of the numbers consistent. Owners forgive bad news and do not forgive figures that change without explanation.
Be careful what individual directors say. The board speaks through its minutes and official communications, and a director who gives a neighbor a different number has created a document the association must live with. Storm-driven assessments carry their own timing pressures, covered in our guide to special assessments after a storm.
The errors that force a board to start over
- Short notice. Thirteen days is not fourteen. Count the days from the mailing, not from the board packet.
- A bare notice. A condominium notice that does not state the estimated cost and describe the purposes does not comply with the statute.
- Spending outside the stated purpose. In a condominium or cooperative, money collected for roof replacement cannot quietly fund a lobby renovation.
- A board levy where the documents require an owner vote. Read the declaration before the meeting, not after the first owner complaint.
- Assessing the work before approving the work. If the project is a material alteration requiring an owner vote, take that vote first.
- No proof of notice. An association that cannot show what it mailed and when has no defense worth having.
- Inconsistent estoppel reporting. Every certificate should describe the assessment the same way.
If one of these has already happened, the usual remedy is to rescind the assessment and re-levy it correctly, which costs a month and some credibility but is far cheaper than defending it. Do not paper over a defective levy by issuing a corrected notice and keeping the original vote.
For community association managers: see The board wants a special assessment: what has to happen first? in the Manager Resource Center.
Frequently Asked Questions About Special Assessments
How much notice does the board have to give before levying a special assessment?
Fourteen days in all three chapters. Written notice of the meeting at which a non-emergency special assessment will be considered must be mailed, delivered or electronically transmitted to owners and posted conspicuously on the property at least 14 days before the meeting. The condominium rule is § 718.112(2)(c)1., the HOA rule is § 720.303(2)(c)2., and the cooperative rule is § 719.106(1)(c).
Do the owners have to vote on a special assessment?
Usually not. In most Florida communities the board levies the assessment and the owners are entitled to notice rather than a vote. Whether an owner vote is required, and at what threshold, is set by your declaration and bylaws. Check the document before the meeting, because a board levy where the documents required an owner vote is one of the few defects that cannot be fixed after the fact.
Can the association spend special assessment money on something else?
In a condominium and in a cooperative, no. The funds may be used only for the specific purpose or purposes set forth in the notice. Chapter 720 contains no equivalent restriction, so an HOA board should look to its declaration. As a matter of practice, spending outside the stated purpose is the fastest way to turn a routine assessment into litigation.
What happens to money left over when the project is finished?
In a condominium, once the stated purpose is complete the excess is common surplus, and the board may either return it to unit owners or apply it as a credit toward future assessments. The cooperative statute speaks of the funds being used for the stated purpose or returned to unit owners. Chapter 720 is silent, so the HOA answer depends on the declaration.
Can we let owners pay in instalments?
Yes, unless your governing documents say otherwise. No chapter requires instalments and none forbids them. Decide the schedule at the same meeting you levy the assessment, state each instalment amount and due date in the notice, and say plainly what happens if an instalment is missed. A missed instalment is a delinquent assessment and runs through the normal statutory collection sequence.
Does a special assessment have to appear on an estoppel certificate?
Yes. The estoppel certificate must disclose the assessment, including amounts levied but not yet due, and the association has 10 business days after a written or electronic request to issue it. Agree on standard estoppel language for the assessment before the first request arrives, so every certificate describes it the same way.
Contact Hamilton Mikes
Hamilton Mikes helps condominium, HOA and cooperative boards in Lee, Collier and Charlotte Counties structure special assessments, draft the notice and purpose statement, and confirm the authority in the governing documents before the board votes. Call 239-594-7227 or visit our Budgeting and Financial Reporting page.
Statutes and authorities referenced
- § 718.112(2)(c)1., Fla. Stat. (condominium: 14-day notice of a meeting at which a nonemergency special assessment will be considered)
- § 718.112(2)(c)3., Fla. Stat. (condominium: notice must state that assessments will be considered and give the estimated cost and description of the purposes)
- § 718.113(2), Fla. Stat. (condominium material alterations; 75 percent of total voting interests where the declaration does not specify a procedure)
- § 718.116(1)(a), Fla. Stat. (joint and several liability of a purchaser for unpaid assessments)
- § 718.116(8), Fla. Stat. (condominium estoppel certificate; 10 business days)
- § 718.116(10), Fla. Stat. (special assessment purpose statement; funds used only for the stated purpose; excess is common surplus)
- § 718.112(2)(f)3., Fla. Stat. (use of condominium reserve funds for other purposes requires a majority of the total voting interests)
- § 718.112(2)(f)2.c.(II), Fla. Stat. (line of credit or loan for milestone or SIRS capital work on a majority of total voting interests)
- § 719.106(1)(c), Fla. Stat. (cooperative: 14-day notice of a meeting at which nonemergency special assessments will be considered)
- § 719.108(9), Fla. Stat. (cooperative: special assessment funds used only for the stated purpose or returned to unit owners)
- § 719.108(6), Fla. Stat. (cooperative estoppel certificate; 10 business days)
- § 720.303(2)(c)2., Fla. Stat. (HOA: 14-day notice; assessment may not be levied unless the notice states that assessments will be considered and the nature of the assessments)
- § 720.303(6)(h), Fla. Stat. (use of HOA reserve funds for other purposes requires a majority vote at a meeting at which a quorum is present)
- § 720.30851, Fla. Stat. (HOA estoppel certificate; 10 business days)