Save Money by Supporting House Bill 7 and Senate Bill 1340
February 6, 2020
We need you to support FSSA’s efforts to allow for alternatives to newspaper advertising of lien sales. The Florida House of Representatives is preparing to vote on House Bill 7, which would allow storage operators the choice to post lien sales on online auction websites or in the newspaper. This legislation would eliminate the newspaper industry’s costly and unnecessary monopoly. Today, please call or email the state representatives for your home and each of your businesses in the state. Ask them to vote YES on House Bill 7. You can find your representatives here. Also, if you live, work, or own a business in Duval, Flagler, Lake, Marion, Miami-Dade, Polk, St. John’s, Seminole, Sumter, or Volusia County, please call or email the members of the Senate Judiciary Committee and ask them to support Senate Bill 1340.
Email Joe Doherty with any questions.
Florida Court Decision Emphasizes Importance of Using a Rental Agreement
Pillay v. Pub. Storage, Inc., 2019 Fla. App. LEXIS 17050.
A recent Florida court decision emphasizes the importance of self storage operators using the rental agreement to reduce or eliminate their liability to tenants’ legal claims. Vignaraj Pillay signed a rental agreement with a Public Storage facility in Florida in 2000. Thereafter, Pillay relocated to Maryland for several years. Public Storage notified Pillay of three separate burglaries involving his unit between 2005 and 2012, but he did not return to inspect until 2015. Upon inspection, Pillay claimed his unit was “in a state of disrepair” with several items stolen or damaged. Pillay sued Public Storage for gross negligence and breach of contract, alleging that Public Storage had a duty to monitor, safeguard, and repair his unit. Public Storage asserted that it was not liable for the losses because of the following exculpatory provision in the rental agreement:
(1) ALL PERSONAL PROPERTY IS STORED BY OCCUPANT AT OCCUPANT’S SOLE RISK.
(2) Owners and Owner’s agents . . . will not be responsible for, and Tenant release Owner and Owner’s agents from any responsibility for, any loss, liability, claim, expense, damage to property . . . including without limitation any Loss arising from the active or passive acts, omission, or negligence of Owner or Owner’s agents.
(3) Tenant has inspected the Premises and the Property and hereby acknowledges and agrees that Owner does not represent or guarantee the safety or security of the Premises or the Property or any personal property stored therein, and this rental agreement create any contractual obligation for Owner to increase or maintain such safety or security.
In finding for Public Storage, the Florida appellate court noted that commercial landlords do not generally have a duty to inspect and repair the premises absent a specific provision in the contract, which the rental agreement did not include. Further, Public Storage had an exculpatory provision, expressly limiting its liability for any loss or claim. After noting that Pillay did not argue that the provision was unconscionable and unenforceable, the appellate court upheld the exculpatory provision and agreed with the trial court’s dismissal.
(1) Exculpatory provisions that limit landlord’s liability in commercial lease agreements in Florida, including self storage rental agreements, will generally be upheld.
(2) Each Florida operator should review its rental agreement. If the rental agreement does not currently contain an exculpatory provision, strong consideration should be given to adding one. If one currently exists, consideration should be given to strengthening it. Consultation with your legal advisor during the drafting process is recommended.
Florida Sales Tax Alert
Effective January 1, 2020, the state sales tax rate on the total rent at a self storage facility decreased from 5.7% to 5.5%. However, the state’s 6% sales tax rate remains in place for the outdoor parking or storage of a motor vehicle. If the motor vehicle is in an enclosed unit, the 5.5% sales tax rate applies. Moreover, the 5.5% sales tax rate also applies to the parking or storage of a boat at a self storage facility, whether the boat is outdoors or in an enclosed unit.
As described by the Florida Department of Revenue, “Sales tax is due at the rate in effect during the time the tenant occupies, or is entitled to occupy, the real property regardless of when the rent is paid. Rental charges paid on or after January 1, 2020, for rental periods prior to January 1, 2020, are subject to 5.7% state sales tax, plus any applicable discretionary sales surtax. Rental payments made prior to January 1, 2020, that entitle the tenant to occupy the real property on or after January 1, 2020, are subject to 5.5% state sales tax, plus any applicable discretionary sales surtax.”
A full list of discretionary sales surtaxes in Florida’s 67 counties can be found here.
Please direct any questions to Joe Doherty, SSA’s Chief Legal & Legislative Officer
Resources for Dealing with the Impacts of Natural Disasters and Disaster Readiness
August 29, 2019
FSSA InPrint Magazine
Click here for the most recent edition of InPrint that contains relevant legal, insurance and other hurricane related articles.
National Self Storage Association - SSA
Click here for a library of disaster readiness resources and articles.
When Disaster Strikes - 2018
Click here for an article on a panel of speakers discussing how to deal with a disaster at the 2018 SSA Spring Conference in Orlando.
Florida and Georgia Operators Reminded of Pricing Requirements During States of Emergency
With Hurricane Dorian projected to hit the southeastern U.S. coast soon, it is important for self storage operators in the potentially affected areas to be aware of their state’s laws related to price increases during a state of emergency. Although few businesses would intentionally raise their rates because of a natural disaster, the laws may affect your ability to implement even standard rate increases during a state of emergency. Read below for more details on the laws in Florida and Georgia. At the time of this writing, South Carolina has not declared a state of emergency.
On August 29, Florida Governor Ron DeSantis declared a state of emergency covering the entire state. Florida’s law against price gouging states that, “it is unlawful . . . for any person to impose unconscionable prices for the rental or lease of any . . . self-storage facility during a period of declared state of emergency.” Unlike some states, Florida’s law against price gouging does not provide a specific amount or percentage increase that is deemed unconscionable. A price may be considered unconscionable if there is a “gross disparity” between the price during the state of emergency and the average price during the 30 days immediately prior to the declaration of the state of emergency. The law provides an exception for a price increase that is “attributable to additional costs incurred in connection with the . . . rental or lease of any . . . self-storage facility, or regional, national, or international market trends[.]”
The state of emergency in Florida may last up to 60 days but may be amended, lifted, or extended at any time.
On August 29, Georgia Governor Brian Kemp declared a state of emergency in the following counties: Brantley, Bryan, Camden, Charlton, Chatham, Effingham, Glynn, Liberty, Long, McIntosh, Pierce, and Wayne. The Governor’s executive order invokes the state’s law against price gouging for “goods and services necessary to support . . . preparation, response, and recovery activities.” Although self storage is not expressly mentioned, it is advisable for self storage operators to ensure compliance with the state’s law against price gouging.
Generally, the law prohibits businesses from selling or offering to sell goods or services “at a price higher than the price at which such goods were sold or offered for sale immediately prior to the declaration of a state of emergency.” However, the law allows for price increases “only in an amount which accurately reflects an increase in cost of the goods or services to the person selling the goods or services.” Moreover, the price of goods or services may be increased during a state of emergency “if the price charged for those goods or services is no greater than the cost to the retailer of those goods or services, plus the retailer’s average markup percentage applied during the ten days immediately prior to the declaration of a state of emergency.”
The state of emergency in Georgia is currently in effect through September 9, 2019 but may be amended, lifted, or extended at any time.
Please email Joe Doherty with any questions.
February 12, 2019
Update: Hearing on Miami-Dade Ordinance Delayed
The hearing on the harmful Miami-Dade paint ordinance has been delayed. Following sustained opposition from the self storage community, the Miami-Dade Commissioner sponsoring the ordinance agreed to a voluntary deferral (for now). The SSA and Florida SSA expect meetings with the Commissioner shortly, with a rescheduled hearing possible in March. Stay tuned to your email, floridassa.org, and selfstorage.org for further updates and opportunities to voice your opposition. Thank you to the SSA/FSSA’s members who contacted us and planned to become involved in this unwarranted threat.
The last 10 years have brought significant changes to self storage lien laws. Forty-nine states now have such laws, with Alaska still living up to its nickname of the Last Frontier. Much of the industry’s focus lately has been on modernizing laws adopted in the 1970s, ’80s, and ’90s to account for technological and operational changes that have come along since the laws’ initial adoption.
The significance of these laws cannot be overstated. They provide a non-judicial process for operators to enforce lien rights when a tenant fails to pay and often provide additional statutory protections for common provisions in rental agreements. Many industries would love to have laws that permit them to expeditiously enforce their rights. Imagine for a moment if you had to file a lawsuit every time you wanted to enforce your lien rights—as a Louisiana state senator tried to force on operators in her state earlier this year. The industry would look dramatically different if not for self storage lien laws.
Why has the industry had so many legislative successes? Because we are fortunate to have a dedicated group of members and state associations working alongside SSA’s staff to pursue the modernization of these lien laws, the adoption of tenant insurance licensing for self storage businesses, and several other legislative and regulatory efforts for our industry.