Bay Isles Association sued over alleged inequity in assessment collection

When a group of Bay Isles Harbor residents took a closer look at their association fees in 2022, disparities in how their properties were assessed stirred up concern. 

That led to the civil suit filed in late 2023, and litigation for the trial is still ongoing. A group of nine residents in Bay Isles Harbor, a sub-association of the Bay Isles Association (BIA), claims the BIA has been assessing property owners using homestead exemptions in contrast to what is allowed on its master declaration. 

Now, the facts have been presented by both sides and the trial is waiting to be seen by a judge to decide on a verdict, according to Mike Taylor, one of the plaintiffs. 

When the BIA collects annual association fees to maintain its budget, the association uses the assessed value of a property rather than evenly dividing the fees among all residents.

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Taylor has been a homeowner in Bay Isles Harbor since 2017, and the other plaintiffs in the suit have owned property in the association for varying years, but all for about 10 years or less, according to Taylor. 

When the group of residents examined their property assessments in December 2022, Taylor said they realized a disparity. The residents first tried to talk with the BIA, before the suit, but Taylor said the answers they received were “not that satisfactory.” 

“Pretty quickly we came to the conclusion that they were allocating assessments based on just assessed value, not fair market value,” Taylor said.

The BIA’s “Master Declaration,” or association code, was recorded in 1976, according to court documents. At that time, the “assessed value” of property was the “just market value,” and did not include the homestead exemption or Save Our Homes cap since neither would be enacted until the 1990s and early 2000s.

According to Taylor, the BIA Master Declaration prohibits the use of homestead exemptions and other exemptions for seniors, widowers, disabled veterans and blind persons, for example.

Instead, the association uses the assessed value of a property. This assessed value could include things like the Save Our Homes cap, which is a 3% cap for homesteaded properties. 

“Over time, these disparities become very large,” Taylor said. “In essence, the long-time, homesteaded residents are being subsidized by non-homesteaded residents and newer owners.”

The crux of the suit claims that the BIA is improperly applying these exemptions. 

Further, the Master Declaration does not include Kaufman language, the suit claims.

Kaufman language is used by adding phrases like “as amended from time to time” to allow documents like the Master Declaration to be amended with new statutes like the homestead exemption and the Save Our Homes cap. 

Despite this, the lawsuit claims the BIA has been applying both the Save Our Homes and 10% tax assessment limitations to the market value of properties in Bay Isles in violation of the Master Declaration “and resulting in assessments that favor long-term residents over new residents and homesteaded owners over non-homesteaded owners,” court documents state. 

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Another part of the suit claims the BIA previously failed to provide owners with necessary information as required by Article 14 of the Master Declaration, including data like the assessed value of individual property, the total assessed value of the association and the association’s annual budget. 

Taylor said, to his knowledge, the BIA never sent out that information until December 2024, after the suit was filed. 

According to Joseph Reiser, president of the BIA, the association’s 2025 budget is about $2.8 million, which he said is higher than in 2024 mostly due to the impact of the hurricanes. 

Resider declined to comment on the lawsuit given the active status of the litigation. 

Desire for equity 

When the plaintiffs first discovered the disparities, Taylor said they went to other sub-associations within the BIA. 

“We presented all this data, and I got a pretty good response from the subassociation presidents,” he said. “But, what happens is, there are going to be winners and losers…it would be very difficult for a subassociation to join in this suit because not everybody in their association benefits.”

While some residents were “losing” by paying more than what the plaintiffs believed to be fair, Taylor said others were “winning” by paying less. It’s because of this that Taylor said it was difficult to get an association on board. 

Thus, the nine plaintiffs are represented in the suit as residents, not on behalf of their sub-association. 

“There were a number of us who felt very strongly about the principles involved," Taylor said. "And, to be clear, it’s not about the money…we were really upset about the lack of fairness.”

Two years of litigation is not cheap, Taylor said. 

“We’re spending the money on behalf of everybody so we can get back to what should be a fair process,” he added. 

According to Taylor, the majority of homeowners in Bay Isles, which have 1,267 units, won’t be impacted significantly if the plaintiffs win the suit and the BIA has to change the way they assess the properties. 

Taylor thinks of it as a bell curve. The majority of homeowners are in the middle and will be impacted by paying maybe $30 more or less, for example. 

But at the ends of the bell curves are where the larger disparities are, and where Taylor and the plaintiffs noticed the differences. 

“For most people, this is not going to be a big deal. It’s really just getting rid of these inequalities at the ends of the distribution,” Taylor said.