A reserve waiver is a membership vote to reduce or eliminate reserve fund contributions for a given year. Waivers are tempting — they lower assessments in the short term. But they create deferred liability that eventually surfaces as a special assessment, deferred maintenance, or in extreme cases, a catastrophic structural failure like the 2021 Champlain Towers South collapse in Surfside, Florida. This comparison maps reserve waiver permissibility across all 50 states.
The Post-Surfside Shift
The June 2021 Champlain Towers South collapse — which killed 98 people — was a turning point for reserve funding law. The building had repeatedly deferred maintenance and kept reserve contributions artificially low through membership waivers. In the years since, Florida, California, and several other states have dramatically tightened reserve waiver rules, and the trend continues in 2026.
States That Prohibit or Severely Restrict Reserve Waivers
| State | Waiver Rule | Minimum Funding Required | Key Statute |
|---|---|---|---|
| Florida (Condos) | PROHIBITED — no waiver allowed as of 2022 | 100% fully funded by 2025 (3-year ramp) | F.S. § 718.112(2)(f) |
| California (CIDs) | Waiver allowed only if 100% funded OR by 2/3 vote | Reserve study required, waiver disclosed in budget | Civ. Code § 5570, § 5600 |
| Nevada | Waiver requires 2/3 membership vote, once per 3 years | Reserve study mandated, shortfall plan required | NRS § 116.3115 |
| Hawaii | No waiver — reserves mandatory for condos | Minimum 10% of annual assessment | HRS § 514B-148 |
| Washington | Waiver requires membership vote annually | Reserve study recommended, not mandated for HOAs | RCW 64.90.550 |
| Virginia | Waiver requires 2/3 vote, full disclosure required | Waiver notice must state funding shortfall impact | Va. Code § 55.1-1825 |
States That Allow Reserve Waivers With Member Vote
| State | Waiver Vote Threshold | Disclosure Required | Key Statute |
|---|---|---|---|
| Colorado | Majority vote of members | Reserve study disclosure in budget | C.R.S. § 38-33.3-303(2) |
| Arizona | Majority vote of quorum | Board must disclose waiver in meeting minutes | A.R.S. § 33-1806 |
| Minnesota | Majority vote of members | UCIOA disclosure requirements | Minn. Stat. § 515B.3-114 |
| Connecticut | Majority vote of members | UCIOA disclosure requirements | CGS § 47-261c |
| Delaware | Majority vote of members | UCIOA disclosure requirements | 25 Del. C. § 81-314 |
| Alaska | Majority vote of members | UCIOA disclosure requirements | AS 34.08.340 |
| West Virginia | Majority vote of members | UCIOA disclosure requirements | W. Va. Code § 36B-3-114 |
| Vermont | Majority vote of members | UCIOA disclosure requirements | 27A V.S.A. § 3-114 |
| North Carolina | Board authority (no member vote required) | Budget narrative disclosure | NCGS § 47F-3-114 |
| Georgia | Board authority | Budget narrative disclosure | O.C.G.A. § 44-3-232 |
| Texas | Board authority for HOAs | No statutory disclosure required | Tex. Prop. Code § 204.006 |
| Illinois | Board authority | Budget summary disclosure | 765 ILCS 160/1-45 |
States Without Reserve Mandates (No Waiver Needed)
In states without dedicated HOA statutes or reserve mandates, there is nothing to waive — the CC&Rs govern reserve contributions entirely. If the CC&Rs are silent on reserves, the board has complete discretion. These states include:
- Alabama, Arkansas, Idaho, Iowa, Kansas, Kentucky, Louisiana, Maine
- Mississippi, Montana, Nebraska, New Hampshire, North Dakota, Oklahoma
- Rhode Island, South Dakota, Wisconsin, Wyoming
- In these states, underfunding is not technically a "waiver" — it is simply allowed by default
The Florida Condo Reserve Revolution
Florida's SB 4-D (2022) and SB 154 (2023) fundamentally changed condo reserve law in the state. Prior to 2022, Florida condo associations could waive reserves by majority vote annually — and many did. Post-Surfside:
- Reserve waivers for structural items (roofs, load-bearing walls, floors, foundations, plumbing) are PROHIBITED
- Milestone inspections required for condos 3+ stories, 30+ years old
- Structural Integrity Reserve Studies (SIRS) mandatory for condos 3+ stories by December 31, 2024
- Reserves for SIRS items must be fully funded — phased to 100% by 2025 for existing associations
- Directors who knowingly vote to waive prohibited reserves face personal liability
- Florida HOAs (not condos) are not covered by SB 4-D — HOAs retain waiver authority
California's Balanced Approach
California allows reserve waivers but requires significant transparency. Civil Code § 5600 requires the annual budget to include the current reserve balance, the percent funded, and whether a special assessment is likely within the next 10 years. If the association votes to reduce reserves below the recommended level, that decision must be disclosed to all members. Civil Code § 5570 requires a reserve study every 3 years. The result: California associations can reduce reserves, but informed member consent is required.
What "Percent Funded" Means for Waiver Decisions
- 100% funded: reserves equal the total deterioration to date of all components — no waiver risk
- 70–100% funded: financially healthy — modest waivers may be defensible short-term
- 30–70% funded: underfunded — waivers increase special assessment risk
- Below 30% funded: severely underfunded — waivers at this level are reckless and may constitute board negligence
- The national average HOA percent funded is approximately 60–65% — most associations are underfunded
Disclaimer: Reserve waiver laws changed significantly in 2022–2025, especially in Florida. This comparison reflects laws as of early 2026. Florida condo associations should consult Chapter 718 and their licensed CAM or HOA attorney before making any reserve funding decisions. Reserve waivers in severely underfunded associations expose directors to personal liability in some states.
This article is for general informational and educational purposes only. It does not constitute legal advice. HOA laws vary by state, and your association's specific CC&Rs and bylaws may create additional requirements. Always consult a licensed attorney in your state before taking legal or enforcement action. Full disclaimer →