Oregon Revised Statutes Chapter 94 § 94.595 — Reserve

Reserve account for maintaining, repairing and replacing common property; reserve study; maintenance plan. (1) The declarant, on behalf of a homeowners association, shall: (a) Conduct an initial reserve study as described in subsection (3) of this section; (b) Prepare an initial maintenance plan as described in subsection (4) of this section; and (c) Establish a reserve account as provided in subsection (2) of this section. (2)(a) A homeowners association shall establish a reserve account to fund major maintenance, repair or replacement of all items of common property which will normally require major maintenance, repair or replacement, in whole or in part, in more than one and less than 30 years, for exterior painting if the common property includes exterior painted surfaces, for other items, whether or not involving common property, if the association has responsibility to maintain the items and for other items required by the declaration or bylaws. The reserve account need not include reserves for those items: (A) That can reasonably be funded from the general budget or other funds or accounts of the association; or (B) For which one or more, but less than all, owners are responsible for maintenance and replacement under the provisions of the declaration or bylaws. (b) The reserve account shall be established in the name of the homeowners association. The association is responsible for administering the account and for making periodic payments into the account. (c) The reserve portion of the initial assessment determined by the declarant shall be based on: (A) The reserve study described in subsection (3) of this section; or (B) Other reliable information. (d) A reserve account established under this section must be funded by assessments against the individual lots for which the reserves are established. (e) Unless the declaration provides otherwise, the assessments under this subsection begin accruing for all lots from the date the first lot is conveyed. (3)(a) The board of directors of the association shall annually determine the reserve account requirements by conducting a reserve study or reviewing and updating an existing study using the following information: (A) The starting balance of the reserve account for the current fiscal year; (B) The estimated remaining useful life of each item for which reserves are or will be established, as of the date of the study or review; (C) The estimated cost of maintenance and repair and replacement at the end of the useful life of each item for which reserves are or will be established; (D) The rate of inflation during the current fiscal year; and (E) Returns on any invested reserves or investments. (b) Subject to subsection (8) of this section, after review of the reserve study or reserve study update, the board of directors may, without any action by owners: (A) Adjust the amount of payments as indicated by the study or update; and (B) Provide for other reserve items that the board of directors, in its discretion, may deem appropriate. (c) The reserve study shall: (A) Identify all items for which reserves are or will be established; (B) Include the estimated remaining useful life of each item, as of the date of the reserve study; and (C) Include for each item, as applicable, an estimated cost of maintenance and repair and replacement at the end of the item’s useful life. (4)(a) The board of directors shall prepare a maintenance plan for the maintenance, repair and replacement of all property for which the association has maintenance, repair or replacement responsibility under the declaration or bylaws or ORS 94.550 to 94.783. The maintenance plan shall: (A) Describe the maintenance, repair and replacement to be conducted; (B) Include a schedule for the maintenance, repair and replacement; (C) Be appropriate for the size and complexity of the maintenance, repair and replacement responsibility of the association; and (D) Address issues that include but are not limited to warranties and the useful life of the items for which the association has maintenance, repair and replacement responsibility. (b) The board of directors shall review and update the maintenance plan described under this subsection as necessary. (5)(a) If the declaration or bylaws require a reserve account, the reserve study requirements of subsection (3) of this section and the maintenance plan requirements of subsection (4) of this section first apply to the association of a subdivision that meets the definition of a planned community under ORS 94.550 and is recorded prior to October 23, 1999, when: (A) The board of directors adopts a resolution in compliance with the bylaws that applies the requirements of subsections (3) and (4) of this section to the association; or (B) A petition signed by a majority of owners is submitted to the board of directors mandating that the requirements of subsections (3) and (4) of this section