Cal. Civ. Code §5570
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Assessment and Reserve Funding Disclosure Summary
Mandates the statutorily-prescribed "Assessment and Reserve Funding Disclosure Summary" form that must accompany the annual budget report (§5300). Subsection (a) sets out the form template (a complete one-page reserve disclosure covering regular assessment amounts, scheduled and special assessment status, reserve calculations, percent funded, 30-year sufficiency determination, and 5-year projections). Subsection (b) defines key terms and contains the statutory reserve calculation formula (current cost × years in service ÷ useful life).
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Reserves
| Ref | Requirement |
|---|---|
| (a) | The reserve disclosures required by Article 7 must be summarized on the statutorily-prescribed form set out in §5570(a). The form is a one-page disclosure covering regular assessment amounts, scheduled and special assessments, reserve calculations, percent funded, 30-year sufficiency determination, and 5-year projections. |
| (b)(1) | Estimated remaining useful life is the statutory term for how long a reserve component is expected to last before replacement. It anchors the §5570(b)(4) reserve funding calculation. |
| (b)(2) | Major component is defined by §5550. Components with more than 30 years of remaining life may be either treated as capital assets in the study OR excluded from the reserve calculation — but either decision must be disclosed in both the reserve study and the §5570 summary. |
| (b)(3) | The §5570 form must accompany every annual budget report distribution under §5300. The form may be supplemented or modified for clarity, but the §5570(a) minimum information must be preserved. |
| (b)(4) | The statutory reserve calculation is current replacement cost × years in service ÷ useful life. The result is what should be saved for that component. Note: this formula is for disclosure purposes — §5570(b)(4) explicitly does NOT require the board to fund reserves at that level. The board sets the actual funding policy. |
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Legal references last verified May 24, 2026.
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