Special to Realty/Builder Connection
A growth management bill supported by business and development interests but opposed by environmentalists and local governments became law with Gov. Charlie Crist’s signature.
The bill is designed to help Florida’s construction industry and create new jobs by making it easier to build in urban areas and extending the life of existing development permits for two years. Other provisions are designed to promote affordable housing development.
Most of the argument has been over a provision designed to correct an unintended consequence of an existing growth management law that requires ample roads and other transportation facilities to be in place before development can occur. That’s a concept known as “transportation concurrency.”
It was aimed at containing sprawl but has had the opposite result. Instead of focusing growth in urban areas, concurrency has shifted it to outlying and rural areas because roads there are less congested and it is cheaper to build.
The new law is intended to channel that growth back into cities by lifting transportation concurrency requirements in what are termed dense urban areas. State review of large regional developments also will no longer be required in those areas.
The bill was supported by the Florida Association of Realtors, Associated Industries of Florida and the Florida Chamber of Commerce.
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Crist signed legislation that will start Florida back on the path to higher property insurance premiums, after what some argued was a failed experiment with artificially low rates in the wake of monster hurricane seasons.
At issue was legislation enacted in 2007 to freeze rates for nearly a million property owners insured through the state-backed Citizens Property Insurance Corp. Opponents blame that freeze for keeping rates at an unsustainably low rate. If a major hurricane had hit, Citizens wouldn’t have had enough to pay claims, leaving all other insurance customers around the state potentially on the hook to bail out the state’s “insurer of last resort.”
The measure gradually ramps up premiums for policyholders in the state-run insurance pool to put it back on more solid footing. The bill allows Citizens to gradually raise rates by 10 percent per year until they are considered actuarially sound.
The legislation also reduces the state’s $20 billion exposure on the Florida Hurricane Catastrophe Fund by phasing out the upper levels of a state backup pool by $2 billion a year over a six-year period.
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The $66.5 billion state budget contains numerous programs of interest to the real estate and construction industries:
• $30.1 million for down payment assistance programs. Beginning July 1, those who qualify for the federal first-time homebuyers tax credit will be able to apply for down payment assistance in advance of closing and then repay the amount borrowed when they get their tax refund.
• Up to $400,000 to prevent, combat and publicize the dangers of unlicensed real estate activity in Florida.
• $540,000 to continue and complete a study to make recommendations on passive strategies on nitrogen reduction that complement the use of onsite wastewater treatment systems.
• $3 million in the Real Estate Trust Fund for the Education and Research Foundation.
• A reduction in the eviction filing fees from $265 to $180. It’s the only fee reduction in the 2009-10 budget and one with a negative fiscal impact of up to $36 million.
• In the area of property insurance, the Legislature capped rate increases at 10 percent per year for Citizens policyholders. The Legislature also repealed the requirement that, effective January 1, sellers of property located in a wind-borne debris region, and which has an insured value on the structure of $500,000 or more, provide prospective buyers the structure’s windstorm mitigation rating.
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One Realtor-supported bill fell victim to Crist’s pen as the governor vetoed a condominium insurance bill.
In his veto letter, the governor said he supports provisions of the bill that repealed the requirement for mandatory property insurance coverage on individual units. But he disliked a provision that delays retrofit requirements for certain sprinkler systems used for common areas from 2014 to 2025.
The governor has directed the Department of Business and Professional Regulation to study the cost and impact of retrofits on insurance premiums, and recommend solutions to the 2010 Legislature.