States That Require Reserve Funding for Condominium Associations

Reserve funding is a critical part of financial planning for condominium associations. Unlike reserve studies, which assess the long-term repair and replacement needs of common elements, reserve funding ensures that associations actually set aside the money needed to cover those future expenses. This helps prevent special assessments, deferred maintenance, and unexpected financial strain on owners.

States With Mandatory Reserve Funding

If your association is located in one of the following 12 states, reserve funding is required by law:

1. Connecticut
2. Delaware
3. Florida
4. Hawaii
5. Illinois
6. Maryland
7. Massachusetts
8. Michigan
9. Minnesota
10. Nevada
11. Ohio
12. Oregon

Why Reserve Funding Matters

• Financial Stability: Funding reserves ensures your association has cash available when major repairs or replacements are needed.
• Protect Property Values: Well-funded reserves prevent deferred maintenance and keep common areas in good condition.
• Owner Confidence: Transparent funding policies build trust and demonstrate responsible management.

Secure Your Association’s Financial Future

If your association is in one of these 12 states, funding reserves is not optional, it’s a legal requirement. Even in states without a statutory mandate, setting aside reserves is a smart strategy to safeguard your property’s long-term health and avoid unexpected assessments. Avoid unexpected assessments and keep your property in top condition. Schedule your reserve funding plan today to ensure your association is financially prepared for repairs and replacements.

Request Your Reserve Funding Plan

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Source: Community Associations Institute Summary of State Reserve Fund Laws

Note: This information is for informational purposes and is not intended to provide legal advice.

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