Article - Corporations and Associations
(a) In this section, “reserve study” means a study of the reserves required for future major repairs and replacement of the common elements of a cooperative housing corporation that:
(1) Identifies each structural, mechanical, electrical, and plumbing component of the common elements and any other components that are the responsibility of the cooperative housing corporation to repair and replace;
(2) States the normal useful life and the estimated remaining useful life of each identified component;
(3) States the estimated cost of repair or replacement of each identified component; and
(4) States the estimated annual reserve amount necessary to accomplish any identified future repair or replacement.
(b) This section applies only to a cooperative housing corporation in Prince George’s County.
(c) (1) This subsection applies to a cooperative housing corporation established on or after October 1, 2020.
(2) The governing body of the cooperative housing corporation shall have an independent reserve study completed not less than 30 calendar days before the first meeting of the cooperative housing corporation at which the members other than the owner have a majority of votes in the cooperative housing corporation.
(3) The governing body shall have a reserve study completed within 5 years after the date of the initial reserve study conducted under paragraph (2) of this subsection and at least every 5 years thereafter.
(d) (1) This subsection applies to a cooperative housing corporation established before October 1, 2020.
(2) If the governing body of a cooperative housing corporation has had a reserve study conducted on or after October 1, 2016, the governing body shall have a reserve study conducted within 5 years after the date of that reserve study and at least every 5 years thereafter.
(3) If the governing body of a cooperative housing corporation has not had a reserve study conducted on or after October 1, 2016, the governing body shall have a reserve study conducted on or before October 1, 2021, and at least every 5 years thereafter.
(e) Each reserve study required under this section shall:
(1) Be prepared by a person who:
(i) Has prepared at least 30 reserve studies within the prior 3 calendar years;
(ii) Holds a bachelor’s degree in construction management, architecture, or engineering or equivalent experience and education;
(iii) Holds a current license from the State Board of Architects or the State Board for Professional Engineers; or
(iv) Is currently designated as a reserve specialist by the Community Association Institute or as a professional reserve analyst by the Association of Professional Reserve Analysts;
(2) Be available for inspection and copying by any unit owner;
(3) Be reviewed by the governing body of the cooperative housing corporation in connection with the preparation of the annual proposed budget; and
(4) Be summarized for submission with the annual proposed budget to the unit owners.
(f) To the extent that a reserve study conducted in accordance with this section indicates a need to budget for reserves, the budget shall include:
(1) For the capital components, the current estimated:
(i) Replacement cost;
(ii) Remaining life; and
(iii) Useful life;
(2) The amount of accumulated cash reserves set aside for the repair, replacement, or restoration of capital components as of the beginning of the fiscal year in which the reserve study is conducted and the amount of the expected contribution to the reserve fund for the fiscal year;
(3) A statement describing the procedures used for estimation and accumulation of cash reserves in accordance with this section; and
(4) A statement of the amount of reserves recommended in the study and the amount of current cash for replacement reserves.
(g) (1) The governing body of a cooperative housing corporation shall provide funds to the reserve in accordance with the most recent reserve study and shall review the reserve study annually for accuracy.
(2) The governing body of a cooperative housing corporation has the authority to increase an assessment levied to cover the reserve funding amount required under this section, notwithstanding any provision of the articles of incorporation, bylaws, or proprietary lease restricting assessment increases or capping the assessment that may be levied in a fiscal year.