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

Overview of Utah reserve study law

Utah’s reserve study framework is built around the concept of a “reserve analysis” and a dedicated reserve fund line in the association budget. Two main statutes apply. The Utah Condominium Ownership Act, Section 57-8-7.5, covers condominiums. 

The Utah Community Association Act, Section 57-8a-211, covers most planned communities and non-condominium HOAs. Both sections introduce similar expectations: periodic reserve analyses, ongoing updates, and transparent disclosure of reserve funding to owners.

In practical terms, if your community has shared common areas and an owners association - whether it is a condominium building in Salt Lake City or a planned community elsewhere in Utah - you should assume that the reserve analysis and reserve fund rules apply and plan accordingly. 

When in doubt, boards should confirm with their legal counsel how their specific community is classified under Utah law.

What is a “reserve analysis” and “reserve fund” in Utah

Utah statutes use the term “reserve analysis” instead of “reserve study,” but for boards the concepts are nearly identical. A reserve analysis is a structured review of the association’s physical assets and long term capital obligations. It evaluates elements such as roofs, pavements, mechanical systems, siding, elevators, and major amenities that will eventually need repair, replacement, or restoration.

The statutes define “reserve funds” as money set aside to cover the cost of repairing, replacing, or restoring common areas and facilities that have a useful life of three years or more, a remaining life of less than 30 years, and that cannot reasonably be funded from the association’s regular operating budget.(utahhoalaws.com) 

In other words, if a component is big, expensive, and not an everyday operating expense, Utah expects you to plan for it in reserves.

The goal of a reserve analysis is to determine how much money should be allocated to reserve funds over time so that major projects can be handled without crisis, extreme dues increases, or emergency special assessments.

Who is covered: condominiums vs HOAs

Under the Utah Condominium Ownership Act, condominium management committees must ensure a reserve analysis is done and updated on a statutory cycle. Under the Community Association Act, most non-condominium HOAs (sometimes called “planned communities”) are subject to an almost parallel set of requirements.

A few older associations that predate the Community Association Act may not have formally opted in to the chapter, but the reserve analysis framework is now widely treated as the standard of care for Utah associations. 

Boards that choose to ignore it risk falling behind both market expectations and the evolving view of what constitutes prudent financial management.

How often Utah associations must perform and update a reserve analysis

Utah law sets two different timing obligations that work together:

1. Full reserve analysis at least every six years. Both condominium management committees and community association boards must ensure that a comprehensive reserve analysis is conducted no less often than every six years. This full analysis typically includes a physical inspection of the property, an inventory of reserve components, estimates of remaining useful life, and projected replacement costs.
2. Review and update at least every three years, plus annual owner summary. In addition to the six year requirement, the statutes require associations to review and, if necessary, update a previously conducted reserve analysis at least once every three years. Associations must also provide owners with a summary of the most recent reserve analysis or update every year.

In practice, a typical Utah HOA or condominium will:

• Commission a full, professional reserve study in Year 1.
• Perform a “level 2” style update with or without site visit around Year 3 or 4.
• Perform another full analysis by Year 6, then repeat the cycle.

Boards should use the annual budget process as a natural checkpoint to revisit reserve funding decisions, even in years when no formal update is required.

Utah reserve fund and budgeting requirements

The statutes require that every year the association’s budget include a distinct reserve fund line item. 

That line item must be funded in an amount the board determines to be prudent based on the reserve analysis, or in the higher amount required by the governing documents if the CC&Rs or bylaws set a stricter standard.

Importantly, Utah law does not set a fixed contribution formula or mandate that the reserve fund reach a certain percentage of “fully funded” status. There is no statutory rule that reserves must equal, for example, 70 percent of the reserve study’s recommendation. What the law does require is that boards:

• Obtain and periodically update a reserve analysis.
• Disclose reserve information and analyses to owners.
• Include a reserve fund line item in the budget.
• Exercise prudence and good judgment when deciding how much to contribute.

A board that repeatedly ignores its reserve analysis and chooses contribution levels that are clearly out of step with projected needs risks breaching its fiduciary duties, even if the statute does not prescribe a number.

How reserve funds can and cannot be used

Utah reserve fund laws focus on long term capital repairs and replacements. Reserve funds are not meant to be a slush fund for routine maintenance or operating shortfalls. They may only be used for components that meet the statutory definition - longer lived, capital type items that cannot reasonably be funded out of the general budget.

There are limited circumstances where Utah law acknowledges that reserves might be tapped to address financial shortfalls or emergencies, subject to conditions and owner notice. 

However, these situations are not the norm and should be handled carefully with legal guidance. As a best practice, boards should:

• Keep operating and reserve funds in separate accounts.
• Document any decision to use reserves for non-standard purposes.
• Adopt a clear plan to replenish reserves after any such use.

Key board responsibilities under Utah reserve study law

For Utah boards and management committees, compliance with reserve analysis requirements boils down to a few core duties:

• Scheduling analyses and updates. Maintain a calendar so a full reserve analysis never goes more than six years without being redone, and a review or update occurs at least every three years.
• Engaging qualified preparers. While the law allows a board to conduct its own analysis, in practice most associations hire an experienced reserve study professional to ensure accuracy, consistency, and credibility.
• Using the results in budgeting. Incorporate the reserve analysis directly into the budgeting process, aligning contributions with projected needs instead of guessing or simply “doing what we did last year.”
• Disclosing to owners. Provide the required summary of the most recent reserve analysis or update each year and make the full report available for review on request.
• Exercising prudence. Deliberate on reserve funding levels, record the rationale in meeting minutes, and adjust contributions when the analysis shows a looming gap.

Practical example: a mid sized Utah condominium

Consider a 120 unit condominium in Salt Lake County with major roof, asphalt, and mechanical components. A professional reserve analysis might show that over the next 30 years the association will need several million dollars to handle major replacements.

 The preparer will recommend an annual reserve contribution based on current fund balance, future projects, and reasonable inflation assumptions.

Under Utah law, the management committee must:

• Commission a full reserve analysis at least once every six years.
• Review and update it at least every three years.
• Provide owners an annual summary of the latest analysis.
• Include a reserve fund line in the budget at a level the committee determines is prudent in light of the study.

If the board chooses to fund reserves at a lower level than recommended, they should clearly document why (for example, owners prefer a phased funding increase over several years) and revisit the decision annually.

How PropFusion helps Utah associations comply

Legal requirements are only part of the reserve planning challenge. Boards also need a way to track projects, monitor reserve balances, and keep analyses and budget assumptions aligned over time. PropFusion’s reserve study tools and marketplace are designed to support exactly this.

For Utah communities, PropFusion can:

• Connect boards and managers with established reserve study professionals who understand Utah Code 57-8-7.5 and 57-8a-211 and the expectations of local lenders and buyers.
• Centralize your most recent reserve analysis, budget assumptions, and funding plans in a single system so they are easy to review and update.
• Provide scenario planning so boards can see the impact of increasing or decreasing reserve contributions before they adopt a budget.
• Automate reminders for when your next full analysis or update is due so you do not accidentally fall out of compliance with Utah’s timelines.

Used together with guidance from your legal and financial advisors, these tools help Utah HOAs and condominium associations move beyond basic statutory compliance and toward genuinely sustainable long term planning.