1     
HOMEOWNERS' ASSOCIATION RESERVE FUND

2     
2015 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Stephen H. Urquhart

5     
House Sponsor: Don L. Ipson

6     

7     LONG TITLE
8     General Description:
9          This bill amends provisions of the Condominium Ownership Act and the Community
10     Association Act relating to reserve funds.
11     Highlighted Provisions:
12          This bill:
13          ▸     defines terms;
14          ▸     provides that a declarant shall make certain disclosures to a purchaser during the
15     period of administrative control; and
16          ▸     makes technical and conforming changes.
17     Money Appropriated in this Bill:
18          None
19     Other Special Clauses:
20          None
21     Utah Code Sections Affected:
22     AMENDS:
23          57-8-3, as last amended by Laws of Utah 2013, Chapters 95 and 152
24          57-8-7.5, as last amended by Laws of Utah 2014, Chapter 189
25          57-8a-102, as last amended by Laws of Utah 2013, Chapters 95 and 152
26          57-8a-104, as last amended by Laws of Utah 2011, Chapter 137
27          57-8a-211, as last amended by Laws of Utah 2013, Chapters 152 and 419
28          57-8a-224, as enacted by Laws of Utah 2013, Chapter 152
29     


30     Be it enacted by the Legislature of the state of Utah:
31          Section 1. Section 57-8-3 is amended to read:
32          57-8-3. Definitions.
33          As used in this chapter:
34          (1) "Assessment" means any charge imposed by the association, including:
35          (a) common expenses on or against a unit owner pursuant to the provisions of the
36     declaration, bylaws, or this chapter; and
37          (b) an amount that an association of unit owners assesses to a unit owner under
38     Subsection 57-8-43(9)(g).
39          (2) "Association of unit owners" means all of the unit owners:
40          (a) acting as a group in accordance with the declaration and bylaws; or
41          (b) organized as a legal entity in accordance with the declaration.
42          (3) "Building" means a building, containing units, and comprising a part of the
43     property.
44          (4) "Commercial condominium project" means a condominium project that has no
45     residential units within the project.
46          (5) "Common areas and facilities" unless otherwise provided in the declaration or
47     lawful amendments to the declaration means:
48          (a) the land included within the condominium project, whether leasehold or in fee
49     simple;
50          (b) the foundations, columns, girders, beams, supports, main walls, roofs, halls,
51     corridors, lobbies, stairs, stairways, fire escapes, entrances, and exits of the building;
52          (c) the basements, yards, gardens, parking areas, and storage spaces;
53          (d) the premises for lodging of janitors or persons in charge of the property;
54          (e) installations of central services such as power, light, gas, hot and cold water,
55     heating, refrigeration, air conditioning, and incinerating;
56          (f) the elevators, tanks, pumps, motors, fans, compressors, ducts, and in general all
57     apparatus and installations existing for common use;

58          (g) such community and commercial facilities as may be provided for in the
59     declaration; and
60          (h) all other parts of the property necessary or convenient to its existence, maintenance,
61     and safety, or normally in common use.
62          (6) "Common expenses" means:
63          (a) all sums lawfully assessed against the unit owners;
64          (b) expenses of administration, maintenance, repair, or replacement of the common
65     areas and facilities;
66          (c) expenses agreed upon as common expenses by the association of unit owners; and
67          (d) expenses declared common expenses by this chapter, or by the declaration or the
68     bylaws.
69          (7) "Common profits," unless otherwise provided in the declaration or lawful
70     amendments to the declaration, means the balance of all income, rents, profits, and revenues
71     from the common areas and facilities remaining after the deduction of the common expenses.
72          (8) "Condominium" means the ownership of a single unit in a multiunit project
73     together with an undivided interest in common in the common areas and facilities of the
74     property.
75          (9) "Condominium plat" means a plat or plats of survey of land and units prepared in
76     accordance with Section 57-8-13.
77          (10) "Condominium project" means a real estate condominium project; a plan or
78     project whereby two or more units, whether contained in existing or proposed apartments,
79     commercial or industrial buildings or structures, or otherwise, are separately offered or
80     proposed to be offered for sale. Condominium project also means the property when the
81     context so requires.
82          (11) "Condominium unit" means a unit together with the undivided interest in the
83     common areas and facilities appertaining to that unit. Any reference in this chapter to a
84     condominium unit includes both a physical unit together with its appurtenant undivided interest
85     in the common areas and facilities and a time period unit together with its appurtenant

86     undivided interest, unless the reference is specifically limited to a time period unit.
87          (12) "Contractible condominium" means a condominium project from which one or
88     more portions of the land within the project may be withdrawn in accordance with provisions
89     of the declaration and of this chapter. If the withdrawal can occur only by the expiration or
90     termination of one or more leases, then the condominium project is not a contractible
91     condominium within the meaning of this chapter.
92          (13) "Convertible land" means a building site which is a portion of the common areas
93     and facilities, described by metes and bounds, within which additional units or limited common
94     areas and facilities may be created in accordance with this chapter.
95          (14) "Convertible space" means a portion of the structure within the condominium
96     project, which portion may be converted into one or more units or common areas and facilities,
97     including limited common areas and facilities in accordance with this chapter.
98          (15) "Declarant" means all persons who execute the declaration or on whose behalf the
99     declaration is executed. From the time of the recordation of any amendment to the declaration
100     expanding an expandable condominium, all persons who execute that amendment or on whose
101     behalf that amendment is executed shall also come within this definition. Any successors of
102     the persons referred to in this subsection who come to stand in the same relation to the
103     condominium project as their predecessors also come within this definition.
104          (16) "Declaration" means the instrument by which the property is submitted to the
105     provisions of this act, as it from time to time may be lawfully amended.
106          (17) "Expandable condominium" means a condominium project to which additional
107     land or an interest in it may be added in accordance with the declaration and this chapter.
108          (18) "Governing documents":
109          (a) means a written instrument by which an association of unit owners may:
110          (i) exercise powers; or
111          (ii) manage, maintain, or otherwise affect the property under the jurisdiction of the
112     association of unit owners; and
113          (b) includes:

114          (i) articles of incorporation;
115          (ii) bylaws;
116          (iii) a plat;
117          (iv) a declaration of covenants, conditions, and restrictions; and
118          (v) rules of the association of unit owners.
119          (19) "Independent third party" means a person that:
120          (a) is not related to the unit owner;
121          (b) shares no pecuniary interests with the unit owner; and
122          (c) purchases the unit in good faith and without the intent to defraud a current or future
123     lienholder.
124          (20) "Leasehold condominium" means a condominium project in all or any portion of
125     which each unit owner owns an estate for years in his unit, or in the land upon which that unit
126     is situated, or both, with all those leasehold interests to expire naturally at the same time. A
127     condominium project including leased land, or an interest in the land, upon which no units are
128     situated or to be situated is not a leasehold condominium within the meaning of this chapter.
129          (21) "Limited common areas and facilities" means those common areas and facilities
130     designated in the declaration as reserved for use of a certain unit or units to the exclusion of the
131     other units.
132          (22) "Majority" or "majority of the unit owners," unless otherwise provided in the
133     declaration or lawful amendments to the declaration, means the owners of more than 50% in
134     the aggregate in interest of the undivided ownership of the common areas and facilities.
135          (23) "Management committee" means the committee as provided in the declaration
136     charged with and having the responsibility and authority to make and to enforce all of the
137     reasonable rules covering the operation and maintenance of the property.
138          (24) "Mixed-use condominium project" means a condominium project that has both
139     residential and commercial units in the condominium project.
140          (25) "Par value" means a number of dollars or points assigned to each unit by the
141     declaration. Substantially identical units shall be assigned the same par value, but units located

142     at substantially different heights above the ground, or having substantially different views, or
143     having substantially different amenities or other characteristics that might result in differences
144     in market value, may be considered substantially identical within the meaning of this
145     subsection. If par value is stated in terms of dollars, that statement may not be considered to
146     reflect or control the sales price or fair market value of any unit, and no opinion, appraisal, or
147     fair market transaction at a different figure may affect the par value of any unit, or any
148     undivided interest in the common areas and facilities, voting rights in the unit owners'
149     association, liability for common expenses, or right to common profits, assigned on the basis
150     thereof.
151          (26) "Period of administrative control" means the period of control described in
152     Subsection 57-8-16.5(1).
153          [(26)] (27) "Person" means an individual, corporation, partnership, association, trustee,
154     or other legal entity.
155          [(27)] (28) "Property" means the land, whether leasehold or in fee simple, the building,
156     if any, all improvements and structures thereon, all easements, rights, and appurtenances
157     belonging thereto, and all articles of personal property intended for use in connection
158     therewith.
159          [(28)] (29) "Record," "recording," "recorded," and "recorder" have the meaning stated
160     in Title 57, Chapter 3, Recording of Documents.
161          [(29)] (30) "Size" means the number of cubic feet, or the number of square feet of
162     ground or floor space, within each unit as computed by reference to the record of survey map
163     and rounded off to a whole number. Certain spaces within the units including attic, basement,
164     or garage space may be omitted from the calculation or be partially discounted by the use of a
165     ratio, if the same basis of calculation is employed for all units in the condominium project and
166     if that basis is described in the declaration.
167          [(30)] (31) "Time period unit" means an annually recurring part or parts of a year
168     specified in the declaration as a period for which a unit is separately owned and includes a
169     timeshare estate as defined in Subsection 57-19-2(19).

170          [(31)] (32) "Unit" means either a separate physical part of the property intended for any
171     type of independent use, including one or more rooms or spaces located in one or more floors
172     or part or parts of floors in a building or a time period unit, as the context may require. A
173     convertible space shall be treated as a unit in accordance with Subsection 57-8-13.4(3). A
174     proposed condominium unit under an expandable condominium project, not constructed, is a
175     unit two years after the date the recording requirements of Section 57-8-13.6 are met.
176          [(32)] (33) "Unit number" means the number, letter, or combination of numbers and
177     letters designating the unit in the declaration and in the record of survey map.
178          [(33)] (34) "Unit owner" means the person or persons owning a unit in fee simple and
179     an undivided interest in the fee simple estate of the common areas and facilities in the
180     percentage specified and established in the declaration or, in the case of a leasehold
181     condominium project, the person or persons whose leasehold interest or interests in the
182     condominium unit extend for the entire balance of the unexpired term or terms.
183          Section 2. Section 57-8-7.5 is amended to read:
184          57-8-7.5. Reserve analysis -- Reserve fund.
185          (1) As used in this section:
186          (a) "Reserve analysis" means an analysis to determine:
187          (i) the need for a reserve fund to accumulate [money to cover the cost of repairing,
188     replacing, or restoring common areas and facilities that have a useful life of three years or more
189     and a remaining useful life of less than 30 years, if the cost cannot reasonably be funded from
190     the general budget or other funds of the association of unit owners] reserve funds; and
191          (ii) the appropriate amount of any reserve fund.
192          (b) "Reserve fund line item" means the line item in an association of unit owners'
193     annual budget that identifies the amount to be placed into a reserve fund.
194          (c) "Reserve funds" means money to cover the cost of repairing, replacing, or restoring
195     common areas and facilities that have a useful life of three years or more and a remaining
196     useful life of less than 30 years, if the cost cannot reasonably be funded from the general
197     budget or other funds of the association of unit owners.

198          (2) Except as otherwise provided in the declaration, a management committee shall:
199          (a) cause a reserve analysis to be conducted no less frequently than every six years; and
200          (b) review and, if necessary, update a previously conducted reserve analysis no less
201     frequently than every three years.
202          (3) The management committee may conduct a reserve analysis itself or may engage a
203     reliable person or organization, as determined by the management committee, to conduct the
204     reserve analysis.
205          (4) A reserve fund analysis shall include:
206          (a) a list of the components identified in the reserve analysis that will reasonably
207     require reserve funds;
208          (b) a statement of the probable remaining useful life, as of the date of the reserve
209     analysis, of each component identified in the reserve analysis;
210          (c) an estimate of the cost to repair, replace, or restore each component identified in the
211     reserve analysis;
212          (d) an estimate of the total annual contribution to a reserve fund necessary to meet the
213     cost to repair, replace, or restore each component identified in the reserve analysis during the
214     component's useful life and at the end of the component's useful life; and
215          (e) a reserve funding plan that recommends how the association of unit owners may
216     fund the annual contribution described in Subsection (4)(d).
217          (5) An association of unit owners shall:
218          (a) annually provide unit owners a summary of the most recent reserve analysis or
219     update; and
220          (b) provide a copy of the complete reserve analysis or update to a unit owner who
221     requests a copy.
222          (6) In formulating its budget each year, an association of unit owners shall include a
223     reserve fund line item in:
224          (a) an amount the management committee determines, based on the reserve analysis, to
225     be prudent; or

226          (b) an amount required by the declaration, if the declaration requires an amount higher
227     than the amount determined under Subsection (6)(a).
228          (7) (a) Within 45 days after the day on which an association of unit owners adopts its
229     annual budget, the unit owners may veto the reserve fund line item by a 51% vote of the
230     allocated voting interests in the association of unit owners at a special meeting called by the
231     unit owners for the purpose of voting whether to veto a reserve fund line item.
232          (b) If the unit owners veto a reserve fund line item under Subsection (7)(a) and a
233     reserve fund line item exists in a previously approved annual budget of the association of unit
234     owners that was not vetoed, the association of unit owners shall fund the reserve account in
235     accordance with that prior reserve fund line item.
236          (8) (a) Subject to Subsection (8)(b), if an association of unit owners does not comply
237     with the requirements of Subsection (5), (6), or (7) and fails to remedy the noncompliance
238     within the time specified in Subsection (8)(c), a unit owner may file an action in state court for:
239          (i) injunctive relief requiring the association of unit owners to comply with the
240     requirements of Subsection (5), (6), or (7);
241          (ii) $500 or actual damages, whichever is greater;
242          (iii) any other remedy provided by law; and
243          (iv) reasonable costs and attorney fees.
244          (b) No fewer than 90 days before the day on which a unit owner files a complaint under
245     Subsection (8)(a), the unit owner shall deliver written notice described in Subsection (8)(c) to
246     the association of unit owners.
247          (c) A notice under Subsection (8)(b) shall state:
248          (i) the requirement in Subsection (5), (6), or (7) with which the association of unit
249     owners has failed to comply;
250          (ii) a demand that the association of unit owners come into compliance with the
251     requirements; and
252          (iii) a date, no fewer than 90 days after the day on which the unit owner delivers the
253     notice, by which the association of unit owners shall remedy its noncompliance.

254          (d) In a case filed under Subsection (8)(a), a court may order an association of unit
255     owners to produce the summary of the reserve analysis or the complete reserve analysis on an
256     expedited basis and at the association of unit owners' expense.
257          (9) (a) A management committee may not use money in a reserve fund:
258          (i) for daily maintenance expenses, unless a majority of the members of the association
259     of unit owners vote to approve the use of reserve fund money for that purpose; or
260          (ii) for any purpose other than the purpose for which the reserve fund was established.
261          (b) A management committee shall maintain a reserve fund separate from other funds
262     of the association of unit owners.
263          (c) This Subsection (9) may not be construed to limit a management committee from
264     prudently investing money in a reserve fund, subject to any investment constraints imposed by
265     the declaration.
266          (10) Subsections (2) through (9) do not apply to an association of unit owners during
267     the period of [declarant control described in Subsection 57-8-16.5(1)] administrative control.
268          (11) For a condominium project whose initial declaration is recorded on or after May
269     12, 2015, during the period of administrative control, for any property that the declarant sells to
270     a third party, the declarant shall give the third party:
271          (a) a copy of the association of unit owners' governing documents; and
272          (b) a copy of the association of unit owners' most recent financial statement that
273     includes any reserve funds held by the association of unit owners or by a subsidiary of the
274     association of unit owners.
275          [(11) This] (12) Except as otherwise provided in this section, this section applies to
276     each association of unit owners, regardless of when the association of unit owners was created.
277          Section 3. Section 57-8a-102 is amended to read:
278          57-8a-102. Definitions.
279          As used in this chapter:
280          (1) (a) "Assessment" means a charge imposed or levied:
281          (i) by the association;

282          (ii) on or against a lot or a lot owner; and
283          (iii) pursuant to a governing document recorded with the county recorder.
284          (b) "Assessment" includes:
285          (i) a common expense; and
286          (ii) an amount assessed against a lot owner under Subsection 57-8a-405(7).
287          (2) (a) Except as provided in Subsection (2)(b), "association" means a corporation or
288     other legal entity, any member of which:
289          (i) is an owner of a residential lot located within the jurisdiction of the association, as
290     described in the governing documents; and
291          (ii) by virtue of membership or ownership of a residential lot is obligated to pay:
292          (A) real property taxes;
293          (B) insurance premiums;
294          (C) maintenance costs; or
295          (D) for improvement of real property not owned by the member.
296          (b) "Association" or "homeowner association" does not include an association created
297     under Title 57, Chapter 8, Condominium Ownership Act.
298          (3) "Board of directors" or "board" means the entity, regardless of name, with primary
299     authority to manage the affairs of the association.
300          (4) "Common areas" means property that the association:
301          (a) owns;
302          (b) maintains;
303          (c) repairs; or
304          (d) administers.
305          (5) "Common expense" means costs incurred by the association to exercise any of the
306     powers provided for in the association's governing documents.
307          (6) "Declarant":
308          (a) means the person who executes a declaration and submits it for recording in the
309     office of the recorder of the county in which the property described in the declaration is

310     located; and
311          (b) includes the person's successor and assign.
312          (7) (a) "Governing documents" means a written instrument by which the association
313     may:
314          (i) exercise powers; or
315          (ii) manage, maintain, or otherwise affect the property under the jurisdiction of the
316     association.
317          (b) "Governing documents" includes:
318          (i) articles of incorporation;
319          (ii) bylaws;
320          (iii) a plat;
321          (iv) a declaration of covenants, conditions, and restrictions; and
322          (v) rules of the association.
323          (8) "Independent third party" means a person that:
324          (a) is not related to the owner of the residential lot;
325          (b) shares no pecuniary interests with the owner of the residential lot; and
326          (c) purchases the residential lot in good faith and without the intent to defraud a current
327     or future lienholder.
328          (9) "Judicial foreclosure" means a foreclosure of a lot:
329          (a) for the nonpayment of an assessment; and
330          (b) (i) in the manner provided by law for the foreclosure of a mortgage on real
331     property; and
332          (ii) as provided in Part 3, Collection of Assessments.
333          (10) "Lease" or "leasing" means regular, exclusive occupancy of a lot:
334          (a) by a person or persons other than the owner; and
335          (b) for which the owner receives a consideration or benefit, including a fee, service,
336     gratuity, or emolument.
337          (11) "Limited common areas" means common areas described in the declaration and

338     allocated for the exclusive use of one or more lot owners.
339          (12) "Lot" means:
340          (a) a lot, parcel, plot, or other division of land:
341          (i) designated for separate ownership or occupancy; and
342          (ii) (A) shown on a recorded subdivision plat; or
343          (B) the boundaries of which are described in a recorded governing document; or
344          (b) (i) a unit in a condominium association if the condominium association is a part of
345     a development; or
346          (ii) a unit in a real estate cooperative if the real estate cooperative is part of a
347     development.
348          (13) "Mixed-use project" means a project under this chapter that has both residential
349     and commercial lots in the project.
350          (14) "Nonjudicial foreclosure" means the sale of a lot:
351          (a) for the nonpayment of an assessment; and
352          (b) (i) in the same manner as the sale of trust property under Sections 57-1-19 through
353     57-1-34; and
354          (ii) as provided in Part 3, Collection of Assessments.
355          (15) "Period of administrative control" means the period during which the person who
356     filed the association's governing documents or the person's successor in interest retains
357     authority to:
358          (a) appoint or remove members of the association's board of directors; or
359          (b) exercise power or authority assigned to the association under the association's
360     governing documents.
361          [(15)] (16) "Residential lot" means a lot, the use of which is limited by law, covenant,
362     or otherwise to primarily residential or recreational purposes.
363          Section 4. Section 57-8a-104 is amended to read:
364          57-8a-104. Limitation on requirements for amending governing documents --
365     Limitation on contracts.

366          [(1) As used in this section, "period of administrative control" means the period during
367     which the person who filed the association's governing documents or a successor in interest
368     retains authority to:]
369          [(a) appoint or remove members of the association's board of directors; or]
370          [(b) exercise power or authority assigned to the association under its governing
371     documents.]
372          [(2)] (1) (a) (i) Governing documents may not require that an amendment to the
373     governing documents adopted after the period of administrative control be approved by more
374     than 67% of the voting interests.
375          (ii) The vote required to adopt an amendment to governing documents may not be
376     greater than 67% of the voting interests, notwithstanding a provision of the governing
377     documents requiring a greater percentage and regardless of whether the governing documents
378     were adopted before, on, or after May 10, 2011.
379          (b) Subsection [(2)] (1)(a) does not apply to an amendment affecting only:
380          (i) lot boundaries; or
381          (ii) members' voting rights.
382          [(3)] (2) (a) A contract for services such as garbage collection, maintenance, lawn care,
383     or snow removal executed on behalf of the association during a period of administrative control
384     is binding beyond the period of administrative control unless terminated by the board of
385     directors after the period of administrative control ends.
386          (b) Subsection [(3)] (2)(a) does not apply to golf course and amenity management,
387     utilities, cable services, and other similar services that require an investment of infrastructure
388     or capital.
389          [(4)] (3) Voting interests under [Subsections (2) and (3)] Subsection (1) are calculated
390     in the manner required by the governing documents.
391          [(5)] (4) Nothing in this section affects any other rights reserved by the person who
392     filed the association's original governing documents or a successor in interest.
393          Section 5. Section 57-8a-211 is amended to read:

394          57-8a-211. Reserve analysis -- Reserve fund.
395          (1) As used in this section:
396          (a) "Reserve analysis" means an analysis to determine:
397          (i) the need for a reserve fund to accumulate [money to cover the cost of repairing,
398     replacing, or restoring common areas that have a useful life of three years or more and a
399     remaining useful life of less than 30 years, if the cost cannot reasonably be funded from the
400     association's general budget or from other association funds] reserve funds; and
401          (ii) the appropriate amount of any reserve fund.
402          (b) "Reserve fund line item" means the line item in an association's annual budget that
403     identifies the amount to be placed into a reserve fund.
404          (c) "Reserve funds" means money to cover the cost of repairing, replacing, or restoring
405     common areas and facilities that have a useful life of three years or more and a remaining
406     useful life of less than 30 years, if the cost cannot reasonably be funded from the general
407     budget or other funds of the association.
408          (2) Except as otherwise provided in the governing documents, a board shall:
409          (a) cause a reserve analysis to be conducted no less frequently than every six years; and
410          (b) review and, if necessary, update a previously conducted reserve analysis no less
411     frequently than every three years.
412          (3) The board may conduct a reserve analysis itself or may engage a reliable person or
413     organization, as determined by the board, to conduct the reserve analysis.
414          (4) A reserve fund analysis shall include:
415          (a) a list of the components identified in the reserve analysis that will reasonably
416     require reserve funds;
417          (b) a statement of the probable remaining useful life, as of the date of the reserve
418     analysis, of each component identified in the reserve analysis;
419          (c) an estimate of the cost to repair, replace, or restore each component identified in the
420     reserve analysis;
421          (d) an estimate of the total annual contribution to a reserve fund necessary to meet the

422     cost to repair, replace, or restore each component identified in the reserve analysis during the
423     component's useful life and at the end of the component's useful life; and
424          (e) a reserve funding plan that recommends how the association may fund the annual
425     contribution described in Subsection (4)(d).
426          (5) An association shall:
427          (a) annually provide lot owners a summary of the most recent reserve analysis or
428     update; and
429          (b) provide a copy of the complete reserve analysis or update to a lot owner who
430     requests a copy.
431          (6) In formulating its budget each year, an association shall include a reserve fund line
432     item in:
433          (a) an amount the board determines, based on the reserve analysis, to be prudent; or
434          (b) an amount required by the governing documents, if the governing documents
435     require an amount higher than the amount determined under Subsection (6)(a).
436          (7) (a) Within 45 days after the day on which an association adopts its annual budget,
437     the lot owners may veto the reserve fund line item by a 51% vote of the allocated voting
438     interests in the association at a special meeting called by the lot owners for the purpose of
439     voting whether to veto a reserve fund line item.
440          (b) If the lot owners veto a reserve fund line item under Subsection (7)(a) and a reserve
441     fund line item exists in a previously approved annual budget of the association that was not
442     vetoed, the association shall fund the reserve account in accordance with that prior reserve fund
443     line item.
444          (8) (a) Subject to Subsection (8)(b), if an association does not comply with the
445     requirements described in Subsection (5), (6), or (7) and fails to remedy the noncompliance
446     within the time specified in Subsection (8)(c), a lot owner may file an action in state court for:
447          (i) injunctive relief requiring the association to comply with the requirements of
448     Subsection (5), (6), or (7);
449          (ii) $500 or the lot owner's actual damages, whichever is greater;

450          (iii) any other remedy provided by law; and
451          (iv) reasonable costs and attorney fees.
452          (b) No fewer than 90 days before the day on which a lot owner files a complaint under
453     Subsection (8)(a), the lot owner shall deliver written notice described in Subsection (8)(c) to
454     the association.
455          (c) A notice under Subsection (8)(b) shall state:
456          (i) the requirement in Subsection (5), (6), or (7) with which the association has failed to
457     comply;
458          (ii) a demand that the association come into compliance with the requirements; and
459          (iii) a date, no fewer than 90 days after the day on which the lot owner delivers the
460     notice, by which the association shall remedy its noncompliance.
461          (d) In a case filed under Subsection (8)(a), a court may order an association to produce
462     the summary of the reserve analysis or the complete reserve analysis on an expedited basis and
463     at the association's expense.
464          (9) (a) A board may not use money in a reserve fund:
465          (i) for daily maintenance expenses, unless a majority of association members vote to
466     approve the use of reserve fund money for that purpose; or
467          (ii) for any purpose other than the purpose for which the reserve fund was established.
468          (b) A board shall maintain a reserve fund separate from other association funds.
469          (c) This Subsection (9) may not be construed to limit a board from prudently investing
470     money in a reserve fund, subject to any investment constraints imposed by the governing
471     documents.
472          (10) Subsections (2) through (9) do not apply to an association during the period of
473     administrative control.
474          (11) For a project whose initial declaration of covenants, conditions, and restrictions is
475     recorded on or after May 12, 2015, during the period of administrative control, for any property
476     that the declarant sells to a third party, the declarant shall give the third party:
477          (a) a copy of the association's governing documents; and

478          (b) a copy of the association's most recent financial statement that includes any reserve
479     funds held by the association or by a subsidiary of the association.
480          [(11) This] (12) Except as otherwise provided in this section, this section applies to
481     each association, regardless of when the association was created.
482          Section 6. Section 57-8a-224 is amended to read:
483          57-8a-224. Responsibility for the maintenance, repair, and replacement of
484     common area and lots.
485          (1) As used in this section:
486          (a) "Emergency repair" means a repair that, if not made in a timely manner, will likely
487     result in immediate and substantial damage to a common area or to another lot.
488          (b) "Reasonable notice" means:
489          (i) written notice that is hand delivered to the lot at least 24 hours before the proposed
490     entry; or
491          (ii) in the case of an emergency repair, notice that is reasonable under the
492     circumstances.
493          (2) Except as otherwise provided in the declaration or Part 4, Insurance:
494          (a) an association is responsible for the maintenance, repair, and replacement of
495     common areas; and
496          (b) a lot owner is responsible for the maintenance, repair, and replacement of the lot
497     owner's lot.
498          (3) After reasonable notice to the occupant of the lot being entered, the board may
499     access a lot:
500          (a) from time to time during reasonable hours, as necessary for the maintenance, repair,
501     or replacement of any of the common areas; or
502          (b) for making an emergency repair.
503          (4) (a) An association is liable to repair damage it causes to the common areas or to a
504     lot the association uses to access the common areas.
505          (b) An association shall repair damage described in Subsection (4)(a) within a time that

506     is reasonable under the circumstances.
507          (5) Subsections (2), (3), and (4) do not apply during the period of administrative
508     control [as defined in Section 57-8a-104].