57-8a-211 - Reserve analysis -- Reserve fund.
57-8a-211. Reserve analysis -- Reserve fund.
(1) As used in this section, "reserve analysis" means an analysis to determine:
(a) the need for a reserve fund to accumulate money to cover the cost of repairing,replacing, and restoring common areas that have a useful life of three years or more, butexcluding any cost that can reasonably be funded from the association's general budget or fromother association funds; and
(b) the appropriate amount of any reserve fund.
(2) Except as otherwise provided in the governing documents, a board shall:
(a) (i) subject to Subsection (2)(a)(ii), cause a reserve analysis to be conducted no lessfrequently than every five years; and
(ii) if no reserve analysis has been conducted since March 1, 2008, cause a reserveanalysis to be conducted before July 1, 2012; and
(b) review and, if necessary, update a previously conducted reserve analysis no lessfrequently than every two years.
(3) The board may conduct a reserve analysis itself or may engage a reliable person ororganization, as determined by the board, to conduct the reserve analysis.
(4) (a) A board may not use money in a reserve fund:
(i) for daily maintenance expenses, unless a majority of association members vote toapprove the use of reserve fund money for that purpose; or
(ii) for any purpose other than the purpose for which the reserve fund was established.
(b) A board shall maintain a reserve fund separate from other association funds.
(c) This Subsection (4) may not be construed to limit a board from prudently investingmoney in a reserve fund, subject to any investment constraints imposed by the governingdocuments.
(5) Subsections (2), (3), and (4) do not apply to an association during the period ofadministrative control.
Enacted by Chapter 46, 2010 General Session