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Guide to Streamlining Florida NTOs, a cash flow crash course





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Experts in this video

Piper Browne
Piper Browne

For most construction businesses in Florida, sending Notices to Owner (NTOs) is critical to protecting lien rights and getting paid quickly.

Whether you have an in-house NTO process, use  a service provider, or have no idea what an NTO is- join construction payment expert Piper Browne for a live webinar.

You’ll hear:

  • What is the purpose of NTOs and what are the rules for sending them in Florida?
  • How do I explain NTOs to the people I work with?
  • How can I start sending NTOs on all jobs without adding more to my plate?


Piper Browne (00:03):
I am Piper, Piper brown. Um, I have been working at Levelset for a couple of years now. Um, I am currently on our growth marketing team, but that’s relatively new. Um, I have spent most of my time here at Levelset on our customer education team. Um, so that means that I have worked with, um, a lot of our partners here at Levelset educating them on the different lien laws, uh, in the states that they’re doing work in and helping them, you know, in their levels, that accounts kind of facilitate the process of protecting their lien rights and speeding up payment. Um, so that’s a little bit about me. I’m going to be your speaker today, your guide, I’m your only speaker in guides. So, um, that’s me. And, um, in case you don’t know much about Levelset, um, let me explain a little bit about who we are.

Piper Browne (00:55):
We are a software company in the construction industry and our software helps thousands of contractors and suppliers, uh, nationwide protect and speed up payment. Um, and we do that in a couple of different ways. We have a couple of different, awesome products that help our partners. Um, but we do things like make sure required notices are sent on time. Um, we fill in, uh, we verify and fill in job information, property owner information. We also alert our partners about, um, payment issues that other folks are having through different data insights. Um, and that’s just to name a few. So we do a lot of cool things for our partners. Um, and that’s a little bit about Levelset, but what we are here to talk about today, um, our Florida’s notice to owners of very, um, fun topic, if you will. So what’s on the agenda today.

Piper Browne (01:50):
Uh, first we are going to start off with what a notice to owner or NTO. I am going to say Antio a lot in today’s, uh, presentation. So that is what I mean, NTO equals notice to owner. So we’re going to start off with what that is and how it helps you get paid. Then we’re going to move into how to actually accurately send, um, one of these NTS and then we’re going to get into how you can streamline the process of sending in to use. Um, at the end, I will do my best to leave some time, um, or I, I definitely will leave, leave some time for question questions and answers. Um, I will do my best to answer all of your questions in the moment, but if I don’t know the answer, I will find it and follow up with you. So that is a promise.

Piper Browne (02:39):
Um, and on that note, I am going to be sending a follow-up email to everyone who attended and registered, um, with a copy of these slides. So no need to worry about jotting down all the notes. I mean, you know, do that too, if you like doing that. Um, but I will send all of this to you all, um, and greetings to everyone. Who’s listening to this in the future. Um, thanks for joining and thanks for everyone who’s here live. All right. So let’s dive in, what is the Florida notice to owner? Um, so if you are working in construction in Florida, you have probably heard of the Florida notice to owner. Um, but it is a preliminary notice. Preliminary notice is kind of an umbrella term for a type of document that is typically sent at the start of a construction project or construction job.

Piper Browne (03:30):
Um, most states have a requirement around this preliminary notice and Florida is no exception. Their requirement is called the notice to owner and, um, whether your job in Florida is, uh, residential, commercial, state, federal, whatever it is, you have to send one of these notice to owners. Um, luckily the deadline is basically the same across all those different types of projects. There are some differences which we’ll get into later. Um, but it’s going to be the earlier of the three scenarios that you see up here on the screen. Um, but you know, the easiest way to remember is for 45 days from your start on the job, whether that’s labor, um, or, you know, providing materials or especially fabricating materials, you’ve got 45 days from that start date to send your notice to owner. And, uh, the reason for sending a notice to owner is multilayered.

Piper Browne (04:31):
Um, first and foremost, it is a visibility document. Um, what does that mean? It means when you send it, it creates visibility. It lets everyone know, um, who you’re sending it to kind of up the payment chain, who you are, what you’re doing on the site, how to get a hold of you, um, that you are working on this job. And thus you expect to be paid promptly. People who are required to receive these notices. So typically your general contractors, your property owners, your lenders, they actually rely on these notices to paint a picture of all of the parties that are working on the project. It makes it easier for them to facilitate smoother payment on the job, which is something that they of course want to happen as well, which brings me to purpose number two for sending these notices. And that is reducing the risk for owners, GCs, lenders, and other parties that might be involved with the payment.

Piper Browne (05:29):
These documents are designed for their benefit, so they can avoid surprises and liens on their projects. Nobody wants a lien. These documents are required to protect folks like them from surprises like liens being filed by some unknown contractor or supplier, not getting paid on the job. You know, it’s understandable when you think about these large construction projects and all of the different tiers, um, there very well could be lots of, you know, folks working on the job that the, uh, property owner lender, for example, don’t even know about, you don’t have to take it personally. There’s just a lot of folks working on there. So sending these notices make sure that they do know who you are, um, and that you are going to be expecting prompt payment. And finally sending the notice to owner and Florida is, uh, required. So that’s, that’s an important reason.

Piper Browne (06:28):
It is strictly legally required to send one of these notices in order to protect your rights to file a valid mechanic’s lien. You send this one document at the start of your job, and you have a safety net that you can fall back on by filing a valid mechanics lien if you’re not paid. Um, and you might be thinking I’ve never had to file a lien. I don’t have very many payment issues. That’s wonderful. Um, that’s, that’s awesome. But the problem is that contractors and first contractors and suppliers is that you just never know. You never know when you might have a problem. Um, and when your lien rights might be needed, it’s really, really unfortunate when someone gets stiffed on a job and they are completely without options because of miss saying this one simple requirement will way back at the start of the job.

Piper Browne (07:23):
And unfortunately we see this circuit, this unfortunate circumstance every day, um, that is why we at Levelset, you know, exist in some ways to help kind of avoid this situation with our partners, um, because it creates a really difficult and painful position for contractors. And, you know, you can bet that those that have been in that situation, maybe some of y’all listening have been in that situation, um, would give almost anything to go back in time and just take care of this one little notice to owner so that then you could use that lien. So that brings me to, um, one of the most common questions we receive here. Um, if I don’t send a notice to owner in Florida, can I still file a lien? If I’m not paid, Florida has very specific and strict rules regarding their preliminary notice to owner. So most parties on a Florida construction project will lose the ability to file a valid and enforceable mechanics lien. If they don’t deliver a preliminary notice, the notice to owner the NTO within the appropriate time, depending on your, uh, type of project and your role. So I’m going to repeat that you will lose your lien rights if you do not send this notice on time and we’ll get into those specifics a little later.

Piper Browne (08:51):
So who needs to send these, um, the short answer? There is everyone, all contractors, subcontractors, material, suppliers, vendors, um, anyone who didn’t contract directly with the property owner is going to need to send one of these notice to owners. This generally excludes the general contractor, but that doesn’t mean that it isn’t common for GCs to send this notice as well for some of the visibility benefits and such. There are a few exceptions to this rule. Um, the first of which is if you are an individual wage labor, let’s say you’re hired by an electrical subcontractor to work on a work on a project. For example, not required to send the MTO number to architects, engineers, other design professionals, not required to send the NTO and number three participants providing subdivision improvements. So improvements for the purpose of making a site suitable for construction, not required to send the preliminary notice to owner, but otherwise everyone else’s, if you don’t fall into those three categories, chances are you probably have to send one of these to protect your lien rights and who is required then to receive these notices.

Piper Browne (10:15):
Um, so while it’s obvious that a notice to owner should be sent to the property owner, other parties are also required to receive this document. Florida requires that the notice be sent to other parties up the payment chain from you. So this means that first tier subs should send the notice to GCs as well as the owner and sub subs should send this notice to the owner, the GC and the sub that hired them. Additionally, Florida allows the property owner to designate some specific party who receive notice. In addition to themselves, this party AK the owner designee must be identified on the notice of commencement and they must receive a copy of this notice. Um, so note that this rule, um, sending the document to anyone up the payment chain is only for commercial or residential, um, jobs on public jobs. There is still the 45 day notice to owner requirements for substance suppliers, but Florida only specifically requires that preliminary notices on public projects be sent to the GC. However, it is best practiced to send to the surety if you know them and the public entity or the owner of the public project as well, best practice send to everyone.

Piper Browne (11:45):
Okay. So how do I know who all of these people are from? This is certainly where some people start to get worried because it’s really difficult, know it’s extremely common to not have this somewhat simple information. Um, it’s maybe it wasn’t given to you, um, at the start of the job when you’re trying to prepare this notice to owner. So a couple of things there, good news is that Florida actually requires the property owner to publicly file a notice called the notice of commencement and OSI for short at the beginning of the project. Um, and this NOC has to list out all of these different, um, parties that required recipients of the notice to owner. They have to file this publicly so that everyone on the project knows the various parties involved. So first and foremost, always a good idea to search for that notice of commencement.

Piper Browne (12:39):
Again, it’s, it’s public, it’s out there at the start of your project. You may also use the building permit. Um, so you can do your own research, you know, some original investigation. Also, you could just ask for it, you know, depending on your relationship with the customer, the general contractor, um, you can just ask them for the preliminary notice information as well, if you feel comfortable. However, um, a lot of our, you know, folks, our partners using Levelset hired us in part to do that project research for them so that there’s less on their plate. Y’all have a lot to do, let us do some of that at work for you. That’s a huge part of the partnership with Levelset the fact that you have our scout research team available to personally investigate each one of your projects, each one of your notices, this is their job, their only job, they are experts and finding project and stakeholder information. So you can really have that peace of mind that these documents will reach the hands of the required recipients and, you know, be all up to statutory code.

Piper Browne (13:54):
So another common question, um, can I send my NTO early or like 45 days is the only deadline, um, and specifically marks the latest that the notice can be provided. However, Florida statute makes it clear that the notice to owner cannot be provided to early specifically. It empowers parties to send the notice to owner as early as they want, but don’t make the mistake of sending your notice to owner late while Florida’s lien. Law is all good with sending notices early. The law is the exact opposite when it comes to late preliminary notices failure to provide the MTO within 45 days from the start of your job is fatal to the lien claim in Florida. I don’t mean to be dramatic. It is what it is. So don’t send them late, might as well, go ahead and send them early. That is the best practice, get it done, get it out of the way and you are covered.

Piper Browne (14:59):
So when I do send this notice to owner, when is the requirement considered satisfied? Is it when it’s mailed? Is it when it’s delivered? The notice to owner is considered, um, required, or the notice owner requirement is, uh, considered satisfied at the time of mailing, but only if the notice is sent within 40 days of first furnishing labor or materials, otherwise the notice is considered served on the date of receipt. So again, best practice since he can’t send the notice too early in Florida, and you can certainly send it late yet. These notices out as early as possible. Also the notice must be delivered by certified mail or personal delivery with evidence of delivery obtained. It’s important to not only deliver this notice, but to keep evidence of the delivery so that you can lay there, prove compliance with the requirement, you know, in case you need to file that lien. And then one day enforce it in court.

Piper Browne (16:04):
Another common question, are there cases where I may need to send multiple anti-DDoS if the work spans over separate locks, parcels tracks, um, one notice to owner is still acceptable. As long as all of those areas are owned by the same owner. And there’s only one prime contract. If there is more than one prime contract and or owner, then you will want to send multiple noticed owners, even if it’s not necessarily required, it’s definitely the safest way to proceed and what information is required, um, on this document. Great question Florida’s notice to owner is a pretty regulated document. The loss specifically outlines what language and specific project details must be included on the document, including a specific warning to the property owner about what lien rights are and how they can protect themselves from having a lien filed on their property by making sure contractors all contractors are paid in full.

Piper Browne (17:16):
So really again, these documents are there to empower the property owner. What you’re seeing up on the screen is an example of Levelsets, preliminary notice format. All of our preliminary notices have this first friendly professional cover letter that provides all of your information. And then the next pages are where we’ll include all the statutorily required language so that it protects your lien rights. We added this cover letter to soften it a bit, um, you know, understandably. So when someone receives a legal look and document with a bunch of legal language on there, it can be a little scary. Um, especially if folks aren’t familiar with lean law, um, or what it means they might just go right to the lien. Someone’s placing a lien on me. Um, so we added this cover letter to make it clear. It’s not a lien, it’s not even signaling any sort of payment issue. This is merely, um, a requirement. We’re doing this to protect ourselves. We do this with all of our customer. That’s, that’s a great thing to say, if you receive any pushback, like this is our standard process, we do this across the board, not the personal, um, and just to, you know, let them know it’s, it’s a friendly document.

Piper Browne (18:31):
Okay. So, uh, by this point in the presentation, I’m sure you are all convinced that sending MTOs on all of your Florida projects is the way to go, but you might be thinking, how do I make this happen? It sounds like a lot of work. I don’t have any time to do more work than I’m doing. And to Levelset, I’m starting a new process can be intimidating. It’s a lot to learn and keep track of. And that is exactly why we exist. We’re here to save you time and to make it easy to implement this new process, um, or just make your current process easier so that it’s not adding extra work to your plate. Um, as soon as you give the project information and the job information and dates that you’re beginning work, um, as soon as you put that into your Levelset account, whether, and there’s, there’s a couple different ways you can do that, you could type it in, you could set up a direct integration with your ERP, lots of options.

Piper Browne (19:33):
As soon as we get that information, we then calculate and track all of your deadlines for you. Based off of the state, you’re doing work in your role on the job, your customer’s role and the type of job it is. And then in terms of actually create things this notice to owner, you will simply, you know, initiate this creation with a couple clicks of a button. Um, if you don’t want to click any buttons, we could also set it up to just do it for you automatically in the background. Um, and again, you can just have this peace of mind because Levelset has all of the statutorily compliant templates in your Levelset account ready to go. Um, and we have a nationwide network of construction attorneys working for Levelset, making sure that all of these forms stay up to date. So you’ll initiate this, uh, this notice.

Piper Browne (20:26):
And then it heads over to our research team, that scout research team that I mentioned earlier, um, they are there to help you with that project research to help fill in the gaps and also verify what you have been given to make sure it’s accurate, that it’s up to date. Um, our scout research solution gives you the access to job property, stakeholder details, um, so that you’re noticed owners are absolutely accurate. Um, and then when they’re done with that, you know, verifying everything, alerting you of conflicts or updates, we actually mail these documents for you. So you no longer need to worry about going to the post office, waiting in lines, making sure you have all the proper forms, stamps, packages, whatever it is. Um, we just do that for you. So you just click some buttons, we will take the rest off of your plate. And then, um, we are going to upload all of the documentation. So the final form of the document, the proof of mailing, we’re going to upload that back into your Levelset account, where it’s stored for you forever so that you can access it whenever you need it.

Piper Browne (21:38):
And then, you know, it, it doesn’t stop there. If you need further legal assistance, when it comes to reviewing contracts, um, the steps that you can take proactively to ensure protection and on your jobs. Um, again, we have that network of vetted construction attorneys that are there to help. And we have a lot of local Florida attorneys who can partner with you to help your current payment related legal issues, or again, help you be more proactive. You know, introducing this notice to owner policy, to avoid these, um, problems in the future. Thank you so much for joining and listening. And again, please reach out if you have any questions or would like to learn more, have a great rest of your week. Bye.