As provided for in Civil Code §5510(b), an association's reserve study must contain the following reserve component details:
- Components. The study must identify major common area components the association is obligated to repair that have a remaining useful life of less than 30 years. Examples are roofs, painting, pool heaters, asphalt repairs/replacement, etc.
- Useful Life. The study must identify the probable remaining useful life of the components. These are estimates since it is impossible to know the true remaining life of each component. Lifespans will vary depending on (i) the original quality of the component itself and (ii) whether the association has a program of regular preventative maintenance.
- Repair Costs. An estimate of the future replacement costs of components must be included. Inflation should be factored into the estimate.
- Reserve Contributions. An estimate of the total annual contribution necessary to defray the cost to repair, replace, restore, or maintain the components identified in paragraph (1) during and at the end of their useful life, after subtracting total reserve funds as of the date of the study.
- Funding Plan. The study must contain a reserve funding plan to pay for the future replacement of components. The plan might be through monthly contributions into the reserve fund or through a combination of contributions and special assessments.
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