Florida statute reference · F.S. § 718.115
§ 718.115 - Common Expenses & Common Surplus
Section 718.115 answers a question that comes up in almost every condo board meeting: what counts as a shared cost, who pays how much, and what happens to money left over at year-end? Understanding how common expenses are defined and allocated is the foundation for a defensible budget and fair assessments.
Reviewed by the Common Elements editorial team, which includes a Florida-licensed community association manager (LCAM) and insurance broker - Florida Licensed Community Association Manager, 2-20 & 6-20.
What boards need to know
A common expense is any cost the association incurs while carrying out its duties under the Condominium Act and the governing documents. That is a broad definition on purpose. Insurance premiums, management fees, utility bills for the common areas, reserve contributions, legal fees, and engineering reports are all common expenses. The board does not need specific authorization in the declaration to incur them — the statutory definition picks up everything within the association's scope of authority.
The allocation formula is locked in the declaration. Each unit's percentage of ownership in the common elements determines its share of every common expense assessment. Changing that percentage requires amending the declaration — typically a 75% or higher owner vote — so the formula is effectively permanent for the life of the condominium. Boards that try to vary the allocation (charging some units more or less than their percentage share for ordinary operating costs) are acting outside their authority.
Reserve contributions are common expenses, not optional line items. That distinction matters because an owner who withholds reserves is withholding a common expense — subject to the same lien, interest, and collection procedures as any other delinquent assessment. Post-SB 4-D, SIRS-scope reserves have the additional protection that even a majority owner vote cannot waive or reduce them.
Common surplus is the mirror image: money the association collected that it did not spend. Most boards retain surplus in the operating fund as a working capital cushion or roll it into reserves. Distributing surplus to unit owners is unusual — most declarations do not contemplate it, and even when they do, it requires a board resolution. There is no statutory requirement to return surplus.
Key requirements
Common expense definition
§ 718.115(1)- All costs of operating the condominium within the association's authority
- Maintenance and repair of common elements
- Insurance premiums (property, liability, D&O, fidelity)
- Reserve contributions — mandatory, not optional
- Management fees, legal fees, accounting fees, engineering
- Utilities and services for common areas
Allocation by percentage of ownership
§ 718.115(2)- Each unit's share equals its percentage of ownership in the common elements
- Percentage is fixed in the declaration and cannot be varied unilaterally
- Changing the allocation requires a declaration amendment (typically 75%+ vote)
- Same percentage governs regular assessments and special assessments
- Limited-common-element costs may be allocated only to benefiting units if declaration permits
Common surplus
§ 718.115(1)- Excess of revenues over expenses at fiscal year-end
- Board may retain as working capital, transfer to reserves, or return to owners
- Distribution to owners requires declaration authorization and board resolution
- No statutory mandate to return surplus
- Most associations roll surplus into next year's operating budget or reserves
Related tools
Annual Budget Estimator
Model your condo's annual operating budget and reserve contributions.
Reserve Funding Calculator
Straight-line and pooled reserve funding projections.
Special Assessment Calculator
Estimate per-unit allocation for a special assessment.
SIRS Reserve Study Planner
Model SB 4-D mandatory reserve contributions by component.
Common questions about § 718.115
- What is a common expense under Florida § 718.115?
- Section 718.115(1) defines common expenses as all costs incurred by the association in exercising its powers and performing its duties under Chapter 718 and the condominium's governing documents. This includes maintenance and repair of common elements, insurance premiums, reserve fund contributions, management fees, utilities for common areas, professional service fees (legal, accounting, engineering), and costs of operating the condominium. The association cannot charge a common expense for something that is solely the unit owner's responsibility under the governing documents.
- How are common expenses allocated among unit owners?
- Under § 718.115(2), each unit owner's share of common expenses is the unit's percentage of ownership in the common elements as stated in the declaration of condominium. That percentage is fixed in the declaration and typically reflects unit size, location, or some other factor the developer chose at creation. It cannot be changed without amending the declaration — which usually requires a supermajority vote of all unit owners. The percentage of ownership also governs voting rights for most matters.
- What happens if the association collects more money than it spends?
- Any excess of revenues over expenses at year-end is called common surplus under § 718.115(1). The association may hold the surplus in the operating account, transfer it to the reserve fund, or — if the declaration permits — return it to unit owners in proportion to their ownership percentages. Most associations retain surplus in the operating fund as working capital or roll it into reserves. Returning surplus to unit owners is the exception and typically requires a board resolution.
- Can the association charge different unit owners different amounts for common expenses?
- Generally no. Each unit's share of common expenses must follow its percentage of ownership as established in the declaration — the association cannot deviate from that allocation for ordinary operating costs. There are narrow exceptions: certain limited common elements (like reserved parking spaces or exclusive-use areas) may have separately assessed costs allocated only to the units that benefit from them, if the declaration so provides. Special assessments follow the same ownership-percentage formula as regular assessments unless the declaration specifies otherwise.
- Are reserve contributions a common expense?
- Yes. Reserve contributions are specifically included in the definition of common expenses under § 718.115(1). This means reserve contributions are as mandatory as any other operating expense — an owner cannot refuse to pay their share of reserves any more than they can refuse to pay their share of insurance. After SB 4-D (2022), SIRS-scope reserve contributions are additionally non-waivable at the membership level for buildings of three or more habitable stories.
- What costs are NOT common expenses under § 718.115?
- Costs that are the individual unit owner's responsibility under the declaration are not common expenses — the association cannot assess them as such. Typical unit-owner expenses include interior unit maintenance, HO-6 insurance on improvements and personal property, and utilities metered to the individual unit. Additionally, costs that benefit only specific owners (and that the declaration assigns exclusively to those owners) are not common expenses allocable to all units. The governing documents define the boundary; § 718.115 does not override them.
Key statutory text
Full text available at Florida Legislature Online.
§ 718.115(1) — Common expenses defined
“Common expenses include the expenses of the operation, maintenance, repair, replacement, or protection of the common elements and association property, costs of carrying out the powers and duties of the association, and any other expense, whether or not included in the foregoing, designated as common expense by this chapter, the declaration, the documents creating the association, or the bylaws.”
Manage your Florida condo budget on Common Elements
Track common expense allocations, reserve contributions, and year-end surplus in one workspace. Free to start.
This is not legal advice. Consult association counsel for your specific situation.