Financial health tool · Florida §718.112(2)(g)
Reserve Funding Health Check
See your association's reserve funded percentage and projected health over a 5, 10, or 20-year horizon. Useful as a quick sanity check before commissioning a formal reserve study.
Statute citations reviewed by the Common Elements editorial team, which includes a Florida-licensed community association manager (LCAM) and insurance broker, Florida Licensed Community Association Manager, 2-20 & 6-20.
Planning horizon
From your reserve study, or estimated total replacement costs over the period.
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Store your reserve study, track balance trends over time, and give every board member visibility into where your reserves stand. Free to start.
Not an official reserve study
This is a planning tool, not an official reserve study. Many states require a reserve study to be prepared by a licensed professional, such as a reserve specialist or engineer. Use this to plan and understand the numbers, then engage a qualified professional where your state or governing documents require one.
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Reserve funding FAQ
- What is the "percent funded" metric for a reserve fund?
- Percent funded compares the actual reserve balance to the "fully funded balance", the amount the reserve fund would hold if every dollar of future replacement cost had been accumulating since each component was new. A 100% funded reserve means the association has saved exactly the right amount proportional to the age and replacement cost of its components. Most reserve specialists consider 70% or higher to be healthy. Below 30% is considered critically underfunded and typically signals a high risk of special assessments.
- What is a healthy reserve fund percentage for a Florida HOA or condo?
- Reserve specialists and the Community Associations Institute (CAI) generally use the following benchmarks: 70–100% funded is considered strong (low risk of special assessments); 30–70% is fair (some risk); below 30% is poor (high risk, often requires a special assessment or reserve loan within 5 years). Florida law does not mandate a specific percent-funded threshold for HOAs under Chapter 720, though SB 4-D created new mandatory full-funding requirements for SIRS components in condominiums under Chapter 718.
- What does it mean if my HOA is "underfunded"?
- An underfunded reserve means the association has not set aside enough money to cover future major repair or replacement costs as they come due. The practical result is that when a major component reaches end of life (roof replacement, elevator overhaul, repaving) the association either cannot pay for the repair, must levy a special assessment on owners, or must take a reserve loan. Severe underfunding can also depress property values, make unit sales more difficult (lenders scrutinize reserve adequacy), and expose board members to claims of fiduciary breach.
- Did SB 4-D change reserve funding requirements in Florida?
- Yes, significantly. Florida's SB 4-D (2022) and SB 154 (2023) eliminated the right of condominium associations with three or more habitable stories to waive or reduce reserves for SIRS components (structural integrity items defined in F.S. §718.112(2)(g)). These must now be fully funded. Associations that previously passed annual resolutions to waive reserves must stop doing so for those specific components. Non-structural reserve items (paving, painting, elevators, pools) can still be waived by a majority vote of the membership.
- How often should a Florida condo update its reserve study?
- Under F.S. §718.112(2)(g), Florida condominium associations must obtain a Structural Integrity Reserve Study (SIRS) at least every ten years. Beyond the SIRS, most reserve specialists recommend updating the full reserve study every 3–5 years, or sooner after a major repair, a significant change in component condition, or a large inflation event that changes replacement costs materially. Many associations commission a reserve study update annually as part of the budget process.
- What happens when an HOA reserve fund runs out?
- When a reserve fund is depleted and a major repair becomes necessary, the association has limited options: levy a special assessment on all unit owners to cover the cost (can be tens of thousands of dollars per unit for major structural work), take a reserve loan from a lender, defer the repair (which often makes the problem worse and more expensive), or pursue insurance claims if the damage is covered. In extreme cases, a building may be declared unsafe for occupancy if structural repairs cannot be funded. Post-SB 4-D, buildings in this situation may also face regulatory scrutiny from local building officials.
Statutory basis
This calculator applies the condominium reserve funding and structural-integrity reserve study requirements in F.S. §718.112. Read the full section for the governing statutory text.