Louisiana HOA Reserve Fund Requirements and Reserve Study Laws (2026 Guide)

Louisiana reserve study and reserve fund laws at a glance

Louisiana sits in a middle category of reserve regulation. The state recognises that reserves matter, and it forces some disclosure and initial funding for condominiums, but it stops well short of mandating regular reserve studies or prescribing how much money must be set aside each year.

For condominium associations, the Louisiana Condominium Act authorises unit owners’ associations to adopt and amend budgets that include reserves, and to collect assessments to fund common expenses. (legis.la.gov) 

Public offering statements for new condo projects must also disclose the amount, or clearly state that there is no amount, budgeted as a reserve for repairs and replacements. 

At the same time, a separate statute requires developers to collect at least two months of assessments from each initial purchaser and place those funds in a separate reserve escrow account dedicated to the association. (Justia)

For homeowners associations and other planned communities, Louisiana has recently overhauled its law through the Planned Community Act, effective for most new communities formed on or after 1 January 2025. The Act creates a modern framework for declarations, association powers, budgets, and disclosures, but it does not add detailed reserve study mandates or minimum reserve ratios. (Steeg Law)

The bottom line from national research is that Louisiana has no statutory requirement to conduct reserve studies and no statewide mandate to fund reserves to any particular level.

That makes it even more important for boards and managers to adopt disciplined internal standards.

Condominium Act provisions that affect reserves

Three parts of the Condominium Act are particularly important when you think about reserves and long term repairs.

First, RS 9:1121.108 on the sale of units requires a developer or declarant, at initial sale, to collect at least two months of assessments from each purchaser, solely for the purpose of establishing the association’s reserve account. Those funds must be kept in a separate reserve escrow account and turned over to the association with other condominium assets when control transitions. This gives a Louisiana condo association at least some starting capital for future capital projects.

Second, RS 9:1123.102, which sets out the powers of the unit owners’ association, explicitly allows the association to adopt budgets for revenues, expenditures, and reserves and to assess owners for common expenses. (legis.la.gov) While the statute is permissive instead of mandatory, it confirms that reserves are contemplated and that associations are authorised to collect for them.

Third, RS 9:1124.102 on public offering statements requires developers to tell buyers whether there is money in the budget dedicated to a reserve for repairs and replacement, and if so, how much. This disclosure requirement is a consumer protection tool. It does not force a developer to fully fund a reserve, but it makes it much harder to hide the fact that a community is being launched with little or no money set aside for inevitable future repairs.

HOAs and the new Planned Community Act

Historically, non-condominium HOAs in Louisiana operated under the Homeowners Association Act and general building restriction rules, with little direct mention of reserves. The new Planned Community Act replaces and expands that framework for most newly formed planned communities, bringing it closer to modern common interest statutes in other states. (Steeg Law)

Key takeaways for reserve planning under the new Act are:

• It clarifies association powers and the corporate style governance model, making it easier for boards to adopt budgets, long term capital plans, and reserve policies.
• It emphasises disclosures in public offering statements, particularly around developer rights and obligations, which encourages more transparent budgeting from the outset.
• It does not, as of early 2026, impose an explicit requirement that HOAs perform reserve studies or fund reserves according to a fixed formula.
  

In practice, that means Louisiana HOAs have wide discretion, but also full responsibility, for deciding how aggressively to fund reserves and whether to commission professional studies.

Are reserve studies required in Louisiana?

Louisiana has no statute requiring associations to order reserve studies on a particular cadence or at all. There is also no state level rule dictating which components must be included, what software or methodology must be used, or who can sign off on a study.

That does not mean a board can safely ignore reserves. Louisiana associations still owe fiduciary duties to act prudently and to maintain common elements. 

Launching or running a community without any serious long range financial plan exposes owners to large, sudden special assessments and can draw sharp criticism when buyers discover the lack of planning.

For that reason, most Louisiana boards follow industry best practice and treat reserve studies as de facto required, even though the statutes do not demand them.

Best practice funding strategies for Louisiana communities

Because Louisiana law does not specify minimum reserve contributions, boards need internal standards to avoid underfunding. Sensible practices for both condos and HOAs include:

• Commissioning a professional reserve study at least once every three to five years, or more often for complex, high risk, or coastal properties.
• Updating the study after major projects, insurance changes, or significant cost shocks such as hurricanes or supply chain spikes.
• Targeting a funding level that keeps the association within a safe band, often 70 to 100 percent of the “fully funded” benchmark, rather than flirting with near zero reserves.
• Avoiding a pattern of intentional underfunding in order to keep monthly dues artificially low, which simply shifts the real cost into future special assessments.

Boards should tie these decisions back to their governing documents. 

Many Louisiana condominium declarations and HOA covenants now include specific language around reserves, special assessments, and long term maintenance responsibilities, sometimes going further than state law.

How often should Louisiana associations revisit their reserve plans

With no statutory timetable in place, the right review cycle is driven by risk and rate of change.

For a typical mid sized association, a new full reserve study every three to five years, with lighter annual updates in between, is a reasonable baseline. Fast changing associations, such as newer communities still phasing in amenities or older properties with major building systems past midlife, should lean toward the shorter end of that range. 

Communities in hurricane exposed regions or on the coast should also be more conservative, as inflation and insurance market disruptions can quickly erode previously reasonable assumptions.

Each annual budget cycle, boards should:

• Compare actual reserve balances to what the last study projected.
• Check whether any major components have aged faster than expected.
• Decide whether to adjust contribution levels, special assessments, or timing of projects to stay within their chosen funding band.

Working with Louisiana reserve study professionals

Louisiana’s mixed legal framework means boards are freer to choose how they manage reserves, but it also leaves more room for mistakes. A good reserve study professional can:

• Build a complete inventory of common components based on your specific property.
• Provide realistic useful life and cost estimates that reflect Louisiana conditions and recent inflation.
• Model multiple funding strategies, showing how different contribution levels affect the risk of special assessments.
• Help boards explain the plan to owners in plain language, making it easier to justify necessary dues increases.

PropFusion maintains a network of vetted reserve study professionals who work with Louisiana condos and HOAs. These providers understand both the statutory context and the practical realities of funding reserves in Louisiana communities, and they can deliver studies in a format that plugs directly into PropFusion’s online Reserve Planner and Reserve Manager tools. 

Boards can then monitor their funding status, test what if scenarios, and keep all their reserve documentation in one place.

Practical next steps for Louisiana boards and managers

If you are serving on a board or managing an association in Louisiana, a pragmatic approach looks like this:

• Confirm what your governing documents say about reserves, long term maintenance, and special assessments.
• Review whether your association has ever commissioned a professional reserve study, and if so, how old it is.
• Compare your current reserve balance to the projected needs over the next 20 to 30 years.
• Decide on a funding policy that fits your community’s risk tolerance and demographics, then document it in board resolutions and owner communications.
• Engage a qualified reserve study professional to validate or refine your plan, particularly if you manage a condominium or a large planned community.
• Use a system such as PropFusion to track reserve balances, upcoming projects, and funding scenarios on an ongoing basis, rather than treating the reserve study as a one time report.

By combining Louisiana’s relatively flexible legal environment with disciplined internal standards and professional support, boards can minimise unpleasant surprises and keep their communities financially healthy without relying on statutory mandates.

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