55-514.1 - Reserves for capital components. - Virginia Statutes

§ 55-514.1. Reserves for capital components.

A. Except to the extent otherwise provided in the declaration and unless thedeclaration imposes more stringent requirements, the board of directors shall:

1. Conduct at least once every five years a study to determine the necessityand amount of reserves required to repair, replace and restore the capitalcomponents;

2. Review the results of that study at least annually to determine ifreserves are sufficient; and

3. Make any adjustments the board of directors deems necessary to maintainreserves, as appropriate.

B. To the extent that the reserve study conducted in accordance with thissection indicates a need to budget for reserves, the association budget shallinclude, without limitation:

1. The current estimated replacement cost, estimated remaining life andestimated useful life of the capital components;

2. As of the beginning of the fiscal year for which the budget is prepared,the current amount of accumulated cash reserves set aside, to repair, replaceor restore capital components and the amount of the expected contribution tothe reserve fund for that year; and

3. A general statement describing the procedures used for the estimation andaccumulation of cash reserves pursuant to this section and the extent towhich the association is funding its reserve obligations consistent with thestudy currently in effect.

(2002, c. 459.)