Wis. Stat. § 703.163
Statutory reserve account.
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Statutory text
DEFINITIONS. In this section: (a) “Reserve funds” means funds derived from assessments against unit owners that are deposited in a statutory reserve ac- count. The term does not include funds for ordinary operations, including amounts held for operational contingencies. (b) “Statutory reserve account” means a separate account es- tablished under this section to hold reserve funds. (c) “Statutory reserve account statement” means a statement indicating whether a statutory reserve account has been estab- lished for a condominium and, if there is no statutory reserve ac- count, how it is anticipated that future expenditures for the repair and replacement of common elements will be funded.
APPLICATION; OTHER RESERVE ACCOUNTS NOT AF- FECTED. (a) 1. Except as provided in subds. 2. and 3., this sec- tion applies to condominiums consisting exclusively of units that are restricted to residential uses. 2. This section does not apply to a small condominium un- less the declarant or the association, with the written consent of a majority of the unit votes, elects to be governed by this section. 3. This section applies to a condominium consisting of both residential and nonresidential units if the declarant or the associa- tion, with the written consent of a majority of the unit votes of the residential units and a majority of the unit votes of the nonresi- dential units, elects to be governed by this section. (b) This section does not affect a reserve account or a similar account existing on November 1, 2004, or a reserve account or similar account established on or after November 1, 2004, that is not a statutory reserve account.
NEW CONDOMINIUMS; ESTABLISHMENT OF STATUTORY RESERVE ACCOUNT BY DECLARANT. (a) Except as provided in par. (c), the declarant of a condominium that is created on or after November 1, 2004, shall establish a statutory reserve account when the condominium is created and shall execute a statutory reserve account statement. The declarant shall determine the an- nual amount to be assessed unit owners for reserve funds after considering the factors under sub.
(a) to (e) and, if the condo- minium is a conversion condominium with more than 4 units, the report prepared under s. 703.33
(cm) 1. (b) Reserve fund assessments for the reserve account estab- lished under par. (a) may first be assessed on a particular unit when a certificate of occupancy has been issued that applies to that unit. The declarant may elect to defer payment of the ac- crued assessments for a particular unit until the first conveyance of that unit. The declarant may not defer payment of accrued re- serve fund assessments for more than 5 years from the date the exterior construction of the building in which the unit is located is completed. The declarant is liable for all reserve fund assess- ments on a unit that accrue before the unit is conveyed. If there are accrued reserve fund assessments against a unit, the declarant shall disclose in writing to the first purchaser of the unit whether the declarant has included any accrued reserve fund assessments in the purchase price of the unit or, if not included, how any ac- crued assessment will be paid. (c) The declarant may elect not to establish a statutory reserve account under par. (a) at the time the condominium is created or, at any time thereafter, may elect to terminate a statutory reserve account during the period of declarant control under s. 703.15
(c). An election under this paragraph shall be made by executing a statutory reserve account statement.
NEW CONDOMINIUM; DETERMINATION BY ASSOCIATION TO ESTABLISH STATUTORY RESERVE ACCOUNT. If a declarant has elected under sub.
(c) not to establish a statutory reserve ac- count or to terminate an account, establishment of a statutory re- serve account shall be addressed at the first annual meeting of the association held after, or at a special meeting of the association held within one year after, the expiration of any period of declarant control under s. 703.15
(c). A statutory reserve ac- count is established under this subsection with the written con- sent of a majority of the unit votes. If a statutory reserve account is established under this subsection, the association shall execute a statutory reserve account statement.
EXISTING CONDOMINIUMS; STATUTORY RESERVE AC- COUNT UNLESS ELECT OTHERWISE. The association for a condo- minium created before November 1, 2004, shall, within 18 months after November 1, 2004, or within 18 months after the ex- piration of any period of declarant control under s. 703.15
(c), whichever is later, establish a statutory reserve account unless the association, with the written consent of a majority of the unit votes, elects not to establish a statutory reserve account. Upon the establishment of or the election not to establish a statutory re- serve account, the association shall execute a statutory reserve ac- count statement.
ELECTION BY ASSOCIATION TO ESTABLISH OR TERMINATE STATUTORY RESERVE ACCOUNT. (a) If an association elects not to establish a statutory reserve account under sub.
or (5), or if an association elects to terminate a statutory reserve account un- der par. (b), the association may at any time thereafter elect to es- tablish a statutory reserve account with the written consent of a majority of the unit votes. (b) An association may, at any time with the written consent of a majority of the unit votes, terminate a statutory reserve ac- count established under par. (a) or sub.
(a), (4), or
except that a statutory reserve account established by a declarant under sub.
(a) may not be terminated until after the expiration of any period of declarant control under s. 703.15
(c). (c) Upon the establishment or termination of a statutory re- serve account, the association shall execute a statutory reserve ac- count statement.
RESERVE FUND. If there is a statutory reserve account for the condominium, the annual budget adopted under s. 703.161 shall provide for reserve funds. Reserve funds may be used as provided in sub. (8). The association shall determine the amount to be assessed unit owners for reserve funds after considering all of the following: (a) The reserve funds currently in the statutory reserve account. (b) The estimated cost of repairing or replacing common ele- ments, other than routine maintenance. (c) The estimated remaining useful life of common elements. (d) The approximate proportion of the estimated cost of re- pairing or replacing common elements that will be covered by the statutory reserve account and the approximate proportion that will be funded by other means. (e) Any other factor that the association considers relevant.
USE OF STATUTORY RESERVE ACCOUNT. (a) Except as provided in par. (b), funds in a statutory reserve account may be used for the repair and replacement of common elements, other than routine maintenance. (b) Funds in a statutory reserve account may be used for nor- mal repair or maintenance, customary services, or other opera- tional costs in excess of amounts budgeted and any contingency funds available for these purposes, with the written consent of at least two-thirds of the unit votes. Funds from the statutory re- serve account used under this paragraph must be replaced within 3 years from the date of withdrawal.
PERMITTED INVESTMENT OF RESERVE FUNDS. Reserve funds may be invested in any of the investments listed under s. 66.0603 (1m) (a).
LIABILITY IMMUNITY. No declarant, unit owner, associ- ation, or director, officer, manager, or employee of an association is liable in connection with the establishment or termination of, or decision not to establish or terminate, a statutory reserve ac- count or for any deficiencies in the statutory reserve account that relate to the determination of amounts to be assessed for reserve funds. This subsection is in addition to any other liability protec- tion available under law.
RECORDING OF STATUTORY RESERVE ACCOUNT STATE- MENT. Each statutory reserve account statement executed under this section shall bear the name of the condominium as it appears on the declaration, shall be prepared in the standard format for recorded documents under s. 59.43 (2m), shall comply with s. 706.05
(a) and (b), and shall be recorded with the register of deeds of the county where the condominium instruments are recorded.
Synced from the Florida Legislature’s official site. Verify the current version before citing.
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Reference only — not legal advice. Verify current text at the official state legislature website before citing. Printed from Common Elements (July 4, 2026).