Maryland Reserve Study Requirements: HB 107, HB 292, and What Boards Must Do Now

Maryland has gone further than almost any other state on reserves. Since October 1, 2022, most condominiums, homeowner associations, and cooperatives have been required to obtain a professional reserve study and update it at least every five years. Since October 1, 2025, they have also been required to fund reserves at the level that study recommends, and to actually deposit the money.

If your board has treated the reserve study as a box to tick, that second change is the one to read carefully. Here is what the law requires, who it covers, and what a compliant association looks like in 2026.

Who the Law Covers

House Bill 107, enacted in 2022, extended statewide the reserve study rules that Prince George's County (2020) and Montgomery County (2021) had already adopted. It amended three statutes:

• Residential condominiums, under the Maryland Condominium Act, Real Property Section 11-109.4.
• Homeowner associations, under the Maryland Homeowners Association Act, Section 11B-112.3, where the association is responsible for maintaining common areas and the total initial purchase and installation cost of those components is at least $10,000.
• Cooperative housing corporations, under the Cooperative Housing Corporation Act.

The $10,000 threshold for HOAs is based on original installation cost, not current value, so almost any HOA with a pool, clubhouse, private road, or stormwater system is covered. Commercial condominiums are outside the law.

What HB 107 Requires

A reserve study at least every five years

The study must be prepared by a qualified person and must, at a minimum, itemize the association's common components, state the estimated remaining useful life of each, estimate the cost of repair or replacement, and state the annual reserve contribution needed to meet those costs.

Deadlines that have already passed

Associations that had a study on or after October 1, 2018 needed an update within five years of that study. Everyone else needed a study by October 1, 2023. Prince George's County associations were due by October 1, 2021 and Montgomery County by October 1, 2022. If your community has not had a study since 2021, it is out of compliance today.

Qualified preparers

The study must be prepared by someone who holds the Reserve Specialist (RS) or Professional Reserve Analyst (PRA) designation, is a licensed engineer or architect, or has prepared at least 30 reserve studies for the applicable type of community in the prior three years.

Disclosure to owners

A summary of the most recent study goes to every owner with the proposed annual budget, and the full study must be available for owners to inspect.

The current study or summary also forms part of the resale disclosure package under Section 11-135.

Authority to raise assessments

The board may increase assessments to meet the recommended reserve amount even where the governing documents cap increases.

This was one of the most significant provisions in the bill, because it removed the most common reason boards gave for underfunding.

What HB 292 Added in October 2025

The 2022 law required boards to include the recommended reserve amount in the budget, but the language left room for boards to treat that as a target rather than an obligation. House Bill 292, enacted as Chapter 519 of 2025 and effective October 1, 2025, closed that gap.

Under the amended budget provisions, Sections 11-109.2 and 11B-112.2, an association must now:

• Adopt a written funding plan, developed in consultation with the reserve study preparer, showing how the association will reach the recommended level. The plan must prioritise components that affect health, safety, and structural integrity, including roofing and structural systems, and essential building systems such as plumbing, electrical, and HVAC.
• Budget reserves at the amount recommended in the most recent study, in line with the funding plan.
• Deposit those funds into the reserve account by the last day of each fiscal year. Budgeting for reserves and then spending the money elsewhere no longer satisfies the law.
• Reach the recommended level within five years of the initial study, extended from the three years HB 107 originally allowed.

There are two limited exceptions. A board may, by a two-thirds vote with notice to owners, deviate from full funding for up to two consecutive fiscal years on documented financial hardship. And an association may borrow from its own reserve account provided the funds are repaid within five years. Both must be recorded, and neither removes the underlying obligation.

What a Compliant Reserve Study Looks Like

The statute's four required elements line up with the physical and financial analysis in the Community Associations Institute's National Reserve Study Standards. In practice, a compliant Maryland study should include:

• A component inventory with quantities, condition, and remaining useful life, based on a site visit. Assessing remaining life properly needs someone on the property, so a desk-only update will rarely satisfy the statutory definition.
• Current replacement costs for each component.
• The percent funded figure and a 30-year funding plan.
• A clear recommended annual contribution, since that number now drives the budget by law.

Given the five-year statutory cycle and the annual review requirement, most Maryland boards are best served by a full study followed by updates with a site visit every three to five years.

What Maryland Boards Should Do Now

1. Find the date of your last study. If it is more than five years old, or there has never been one, you are already non-compliant. Commission a study now.
2. Compare your current reserve line to the study's recommendation. If there is a gap, that gap is what the funding plan has to close within the statutory window.
3. Adopt a funding plan in writing. Work with your study preparer, prioritise safety and structural components, and minute the board's adoption of the plan.
4. Confirm the deposit happens. Whoever handles the association's accounts needs to move the budgeted reserve contribution into the reserve account before fiscal year end, every year.
5. Distribute the summary with the budget. Owners should receive the study summary alongside the proposed budget, and the full study should be available on request.

A professional study for a typical Maryland community costs a few thousand dollars. The exposure for a board that has ignored a statutory duty for four years is considerably larger.

Reserve Studies Across Maryland

Reserve Study Group prepares reserve studies for condominiums, HOAs, and cooperatives across Maryland, built to the National Reserve Study Standards by designated Reserve Specialists who meet the state's preparer requirements, and delivered through the PropFusion planning platform so boards can track their funding plan between updates. If your community needs a compliant study or a funding plan under HB 292, request a proposal. For the rules in other states, see our state law guide.

‍