Question: Our homeowners’ association recently signed a new contract with a management company. The contract discusses a number of fees that the management company will charge the association in connection with handling certain owner-related tasks such as collections and records inspection. Are these charges permissible?
  Answer: There are two issues to be considered here. The first issue is the terms the association has agreed to in its contract with the management company. The association and the management company can negotiate how the association will be charged for various managerial services. Some associations negotiate for an inclusive price, so that all of the services are included in the monthly fee paid by the association. Other associations negotiate a contract where certain services are paid for on an as-needed basis. Neither approach is necessarily right or wrong, and would depend on each association’s needs and its relationship with its management company. Further, neither the Condominium Act, Chapter 718, or the Homeowners’ Association Act, Chapter 720, discuss how the association should be billed for services by the management company.

However, there are limitations on charges that the owners can be required to pay, with regard to actions taken by the management company, on behalf of the association. Section 720.303(5) of the Florida Homeowners’ Association Act states that an association may impose fees to cover the costs of providing copies of the official records, including the costs of copying and the costs required for personnel to retrieve and copy the records if the time spent retrieving and copying the records exceeds one-half hour and if the personnel costs do not exceed $20 per hour. Personnel costs may not be charged for records requests that result in the copying of 25 or fewer pages. The association may charge up to 25 cents per page for copies made on the association’s photocopier.

Accordingly, in the homeowners’ association context, the association can pass through to the owners certain administrative costs associated with retrieving and copying records as provided by the statute. The Florida Condominium Act does not contain a similar provision and in the context of a condominium, only the cost of copying the documents may be charged to a unit owner.

Further, both the Condominium Act and Homeowners’ Association Act permit the association to charge an administrative late fee, not to exceed $25.00 or five percent of the delinquent installment, if authorized by the governing documents for the association. It is not uncommon for management company contracts to provide that the management company will retain the late fee as compensation for the additional administrative burden of handling delinquent accounts. However, that would be an issue of contract negotiation between the association and the management company.