For the past 18 months, eight (8) unit owners with exclusive use of a garage have objected to the increase in the garage assessment. Over the past two (2) decades, inflation has risen by more than 61%, yet the garage assessment remained virtually unchanged despite the rising expenses associated with maintaining our twenty-five (25) garages. These expenses, including the reserve fund for roofs and painting, garage doors, general maintenance, property insurance, and electricity—were unfairly passed on to 215-unit owners who had no access to a garage. These 215-unit owners, with no garage access, effectively subsidized the garage expenses through higher monthly assessments. This was done without their knowledge or consent. Funds that should have been allocated to the Reserve Fund were never properly paid.
How could this happen? The developer had originally established the correct format for the garage assessment in 2001, which was $13 for the garage assessment and $5 for the garage reserve. In October 2005, the Association took over the management of Southern Grove. The following year, in 2006, the Association’s Board of Directors (BOD) reduced the garage assessment to $14.95. By 2007, the Association’s financial records indicate that only one owner with exclusive use of a garage paid the monthly garage assessment. No explanation could be found for why this occurred. Attempts to seek insight from two former Board members, who served during 2005, 2006, and 2007 and had exclusive use of a garage, yielded no response.
From 2008 to 2023, the garage assessment never exceeded $20.87. This monthly assessment effectively became a fixed cost, going unexamined and unchallenged. During this time, two property management companies, who primarily prepared our annual budgets and managed the community from 2005 through 2024, along with the assigned CAMs, auditors, and various BODs, failed to question or address this issue. Additionally, one Board member, who served as both president and vice president from 2006 to 2023 and could provide insight into how the garage assessment was formulated, has been unable or unwilling to explain how the assessment and garage insurance were calculated during these years.
In 2023, we experienced a change in property management. During the preparation of the FY 2024 budget in June 2023, our new property manager posed a straightforward question: “How do you determine the garage assessment?” This inquiry sparked controversy among some unit owners with exclusive use of a garage when the garage assessment was increased from $20 to $45, with the garage reserve set at $44. These owners refused to accept responsibility for the maintenance expenses associated with the garages, despite having paid a garage assessment for the past 20 years.
Our governing documents are unequivocal regarding the responsibility for garage maintenance. At the request of the unit owners with exclusive use of a garage, we sought a written legal opinion from Ansbacher Law. This opinion confirmed that the garages are a limited common element, and it clearly placed responsibility for all maintenance expenses on the unit owners who had purchased exclusive use of a garage. The method for assigning garage use rights was incorporated into our documents by the developer. Initially, garages were assigned by the developer for a fee of $15,000. Any subsequent transfer of garage access is handled as a transaction between two-unit owners. When an owner with exclusive garage use sells their unit or relinquishes access to a garage, they may only sell the exclusive use rights to another unit owner residing at Southern Grove Condominiums. The Association retains ownership of the garages but does not receive any proceeds from these transactions between owners.
If this arrangement for assigning garage use seems unusual, you are not alone in thinking so. Recognizing the complexity of this issue, the Board of Directors (BOD) consulted with our attorney to explore whether it would be legally feasible to deed the garages to the current unit owners with exclusive use. While there may be a potential path forward, the legal barriers are significant. Such a move would require unanimous consent from all 240-unit owners and amendments to our governing documents. This process would be both time-consuming and costly to undertake.
In FY 2024, the monthly garage assessment was $45, with a garage reserve of $44. For FY 2025, the garage assessment increased to $55, and the garage reserve rose to $63. These increases prompted objections from some unit owners with exclusive use of a garage. Their primary claim was that no maintenance had been performed on the garages in the last 20 years. This claim, however, is unfounded. In the past seven (7) years alone, the garages have undergone significant maintenance, including the installation of new roofs, exterior painting, repair or replacement of garage door panels, the addition of gutters to the front of the garages, and the installation of new LED lighting fixtures.
Additionally, over the last two (2) years, several specific repairs have been completed. These include repairing the stucco wall of garage #2, which was severely damaged in a hit-and-run incident, and replacing the gutter on garage #3 after it was struck by a box van in another hit-and-run. Furthermore, the roof over garage space #9 developed a leak that was not covered by the roof warranty. Repairs to this roof, as well as the damaged interior ceiling wallboard, will also be funded through garage maintenance reserves.
On September 26, 2024, a Reserve Study and Structural Integrity Study were conducted. While these studies highlighted a substantial increase in the required Reserve funding for the garages, no objections were raised by unit owners with exclusive use of a garage. However, the point of contention has been the allocation of garage property insurance expenses. The Board of Directors (BOD) requested that our insurance carrier provide a separate cost breakdown for the six (6) garage buildings as part of the 2025 property insurance premium. The underwriters, however, declined this request, stating they only provide the total property insurance premium, which amounted to $160,800 in 2024. This figure was based on the 2024 property appraisal, which doubled the value of Southern Grove from $39,000,000 to $78,000,000 within four (4) years. The 2024 property insurance premium increased by 11% compared to the previous year.
Given these constraints, the only method available to determine the applicable insurance expenses for the six (6) garage buildings is to allocate a portion of the Ordinance and Law premium and the applicable share of the insurance premium financing charges. Ordinance and Law coverage is an additional feature of the property insurance policy that covers the added costs of rebuilding in compliance with current building codes. Other expenses factored in the garage assessment include Reserve Fund contributions for roofs, painting, and garage doors, as well as general maintenance and electricity costs. Since none of the 25 garages have separate electric meters, we estimate the share of fixed monthly meter fees and electricity usage. A flat fee of $5.00 is applied to the garage assessment to account for these expenses.
At the February 6, 2025, Board of Directors (BOD) meeting, an opinion on calculating the insurance premium for the FY 2024 garage assessment was presented. This opinion was prepared by Tom Rogerson, Unit #915, a unit owner with exclusive use of a garage and a former Board member from 2006. Notably, Tom was not present at the meeting. His calculations were based on the square footage of the twenty-five (25) garages compared to the fifteen (15) residential buildings and the clubhouse. Using this approach, he concluded that the annual property insurance premium for the twenty-five garages amounted to $1,667.55 for FY 2024, equating to $5.56 per month per garage.
This figure is remarkable, particularly given that when Tom purchased exclusive use of a garage, the insurance expense for garages listed in the 2011 budget was $3,624. However, it is worth noting that Tom is not an underwriter. Underwriters are professionals who determine insurance coverage by evaluating various risk factors to set appropriate premiums. Unlike Tom’s method of using square footage as the sole determining factor, underwriters assess a broader range of risk exposures. These include the property’s use, age, and condition; the building’s construction; the presence of safety devices such as smoke detectors, monitored fire alarm systems, and surveillance cameras; claim history; and other factors that influence the level of risk.
The Board of Directors (BOD) and underwriters share a fiduciary responsibility to ensure that our community is adequately protected against potential risks. Appropriate assessments are crucial to guarantee that sufficient funds are available to maintain the community and that the Association remains financially solvent to meet all obligations to its owners. The twenty-five (25) garages are owned by the community, and the garage assessment budget is designed to ensure sufficient funding for both exterior and interior maintenance. To date, the Association has invested over $7,000 in legal fees to reaffirm that the BOD has correctly applied our governing documents, identifying the twenty-five (25) garages as a “limited common element” in accordance with Florida Condominium Law. Furthermore, the legal opinion confirmed that unit owners with exclusive use of a garage are responsible for all maintenance costs included in the garage assessment.
The FY 2024 and FY 2025 budgets were discussed in detail at multiple budget workshops and Board meetings, which were open to all unit owners. Detailed handouts explaining the methodology used to calculate the garage assessments were also provided. The BOD approved these budgets in compliance with Florida Condominium Law.
Despite these efforts, approximately one-third of unit owners with exclusive use of a garage continue to reject the increases in the garage assessment, offering no alternative solutions other than Tom Rogerson’s proposal. Some of these owners have engaged in an aggressive campaign of requesting Association documents and information, only to question their validity. The BOD and property manager have faced verbal attacks, with their ethics, honesty, and integrity repeatedly called into question.
In 2024, three (3) complaints were submitted against the Association to the Department of Business and Professional Regulation (DBPR). Rogerson’s complaint alone was under review by the DBPR for seven months. Throughout this process, the Association provided all requested documents, including garage history, financial records, and the Ansbacher legal opinion. As with the other complaints, the DBPR legal counsel determined that the Association is in compliance with Florida Condominium Law and other applicable Florida rules and regulations. Nonetheless, the former longest-serving Board member, with 20 years of service, dismissed DBPR’s findings, referring to the organization as “clueless” in this matter.
The Board of Directors is legally obligated to adhere to the provisions of our governing documents, regardless of individual opinions on specific clauses. It is not permissible to charge the 215-unit owners who do not have access to garages for their maintenance costs. Unit owners with exclusive use of a garage retain the option to sell their exclusive use rights at any time. The current garage assessment comprehensively accounts for all expenses necessary to maintain these structures. Attempts to harass the Association or property management will neither alter the requirements outlined in our governing documents nor impact the expenses covered by the garage assessment, which are essential for the proper upkeep of the garages.
This issue has persisted for nearly two years, during which we have repeatedly sought your input on potential solutions without receiving a substantive response. Consequently, this letter will serve as the final communication regarding the garages. Any future emails or correspondence on this matter will not be addressed, as the questions have been answered exhaustively through various means, including consultations with the DBPR and Ansbacher Law. This topic is now considered resolved and will not occupy further time or resources of the Board. Should you continue to feel that an injustice has occurred, you are welcome to seek independent legal counsel, as the Association will no longer engage in discussion on this matter.
refuse to accept the financial reality that the garage assessment cannot remain $20 a month into perpetuity.
Regards,
BOD