THE ANNUAL MEETING/ELECTION: IT’S NOT A BOARD MEETING!

What then is “the Annual Meeting?”

By law Florida condo associations must have an Annual Meeting each year; but, conversely, they need not have an election every year if there are no new candidates. What can be somewhat confusing is that they are two separate things with separate quorum requirements and with a rule that they must be held on the same day. Further, conduct of the Annual Meeting should not be confused with that of a Board meeting.

The statutory requirement for an annual meeting (which seeks to give owners a “voice”) was written to ensure that the residents are well informed, especially in communities that have very few board meetings. It’s a members’ meeting. No Board business, board action or voting may be conducted; but there may be reports, and there may be a “State of the Association” speech to highlight events of the previous year.

Board members are not even required to attend the Annual Meeting. Although a Board member could chair the Annual Meeting, he or she would be doing so as a resident, not a Board member. As a rule, the Meeting is chaired by an appointed impartial resident, the Property Manager, or, if deemed necessary, by the association’s attorney. Any Motions that are made are passed by a show of hands of those present.

If there is an election, residents may vote either in person by placing their ballot in the ballot box or by mailed-in ballot. The proxy that is sent to residents in advance with the meeting announcement has nothing to do with the election. Its only purpose is to establish a quorum for the Annual Meeting.

There are two separate quorum requirements for the Annual Meeting and the Election. For the Annual Meeting, it’s 50% of the resident population plus one. For the election, the quorum is only 20% of the resident population.

How To Conduct the Election

Assuming there are candidates or Directors with expiring terms, and an Election is needed, it may take place simultaneously with the Annual Meeting. Once the Annual Meeting is turned over to the impartial Chair and the Chair has determined that a quorum has been met, he or she introduces the Inspector of Elections.

The Inspector then introduces the ballot counters and confirms that, per the Election rules, they are not Board members or Board candidates, nor are they related to Board members or candidates.

Before the counting can begin the Inspector is asked to confirm that there was a quorum for the Election. If a 20% election quorum does not exist, ballots are not opened and the current board remains in place for the coming year.

The Inspector, along with the ballot counters, also confirms that the signatures of the outer envelopes mailed in advance to residents for voting purposes have been verified and are unopened. Those envelopes are required to provide the unit number, name of the voting member and be signed on the outside. Units with more than one owner, units owned by a trust, LLC, or units owned by a corporation must have a voting certificate on file that shows who is authorized to vote for the unit. Outer envelopes should contain the sealed ballot envelopes. Proxies should not be placed in the ballot envelopes. No identification or markings are permitted on the inner ballot envelopes. When an outer ballot envelope is improperly completed, it is marked “disregard” and left unopened.

Ballots may no longer be accepted once the first ballot is opened. The polls are closed by the Inspector once there are no more new voters confirmed by a Motion from the floor to close the polls. The residents pass the Motion by a show of hands. Ballots cannot be accepted once the counting process begins.

That being done, the Inspector turns the meeting back to the appointed Chair, who begins the Annual Meeting while the ballot counting takes place in plain sight of residents. Anyone may observe the vote counting but may not interfere.

At the conclusion of the counting and verification, the results are announced by the Inspector, after which the Chair may adjourn the Meeting. All election materials must be kept for one year.

It should be noted that in most associations, newly elected board members begin their term immediately once the vote has been concluded.

It is also advisable to schedule an Organization Meeting of Board members immediately following the annual meeting so that directors and officers can be appointed or reappointed and take their positions without a lapse in leadership.

This article was written by Steven J. Weil, Ph.D., EA, LCAM, President, Royale Management Services, Inc., he can be reached by email if you have questions or comments you would like to address to him at steve@RMSAccounting.com

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