The catch-up funding rule, which overrides your bylaws

This is the provision that would change what New York owners pay, and it deserves quoting in full. A8945 subdivision 6:

“If a condominium or cooperative housing association does not have an adequate reserve fund as described in subdivision one of this section and would require an increase of more than ten percent of the prior year's common expense assessment, the deficiency shall be made adequate within ten fiscal years or the projected date predicted by the reserve study by which absent increased funding, the balance in the association's reserve account would fall below zero. In either case, the annual increase in reserve funding during the required period of time shall be an equal annual line item increase in the reserve fund until the reserve fund is made adequate, notwithstanding causing an increase of more than ten percent in the annual common expense assessment.”

And subdivision 7, for the smaller gap: “If a condominium or cooperative housing association does not have an adequate reserve fund... and would require an increase of less than ten percent of the prior year's common expense assessment, the deficiency shall be made adequate within three fiscal years.”

Read the structure. A small shortfall must be cured in three fiscal years. A large one gets up to ten, via equal annual line-item increases. And the closing clause of subdivision 6 expressly overrides any cap on annual assessment increases — which many New York declarations contain, and which is the mechanism our assessment limits page covers. Boards would lose the discretion to defer.

What a study would have to contain

Subdivision 2 lists eight required elements, including “an analysis of the physical status and of the common area components of the buildings and other common areas that the association is obligated to maintain”; anticipated maintenance costs and the cost of repair or replacement of components “which are necessary to maintain the structural integrity of the buildings”; “a reasonable estimate of the cost of any future reserve studies, reserve study updates, or engineering reports”; and “a proposed thirty-year funding plan that establishes the adequate proposed capital reserve funding over a thirty-year period.”

Subdivision 4 adds a second professional: a study must “be reviewed by a licensed architect, engineer, or credentialed reserve specialist” — i.e. review by someone other than whoever wrote it.

The regulator split, and why it matters

A8945 subdivision 9 sends studies to the Comptroller within sixty days of completion and gives that office real teeth: “The state comptroller shall have the authority to review and audit such documents and compel a property management company, board of managers, or any condominium or cooperative housing association to complete a capital reserve study if they have not done so pursuant to this section.”

S7600 is substantively the same scheme — the 30-year plan, the CAI National Reserve Study Standards, the credentialed professional, the $25,000 threshold, one year for existing associations and two for new ones, the three-and-ten-year cure windows keyed to the 10% test — but files with the Attorney General. Its official summary says so: it “requires the study to be filed with the attorney general.”

There is a documented inconsistency inside A8945's own paperwork. Its sponsor's memorandum says studies “would have to be filed with the Office of the Attorney General who would have jurisdiction to review and audit any such documents,” while its bill text says the Comptroller. The text controls, but the discrepancy is the clearest evidence that the two bills were drafted from a common source and have not been reconciled.

The Surfside framing, and the New Jersey comparison

A8945's justification: “On June 24th, 2021, Champlain Towers South, a 12-story condominium in Surfside, Florida experienced a partial collapse that resulted in the deaths of 98 residents, becoming the third-deadliest non-deliberate structural engineering failure in United States history. In the wake of this tragedy there is more awareness of the need for oversight of condominium and cooperative housing associations in order to ensure they are up to building, health, safety, and fire standards. As part of a wider condominium and cooperative housing regulation passed last year, New Jersey has likewise required these associations to complete a capital reserve study.” Its fiscal note: “Minimal to New York State.”

The memorandum also claims “PRIOR LEGISLATIVE HISTORY: New Legislation.”

Why this is going to happen anyway

The important thing for a New York board to understand is that the reserve reckoning is arriving from a different direction. New York has no reserve mandate today — but Fannie Mae's project standards do, and they now require a Full Review of the association's finances for essentially every established condominium project over ten units. A budget that fails the lender's reserve test makes every unit in the building harder to finance at once, with no legislature involved.

So a New York board adopting its next budget faces a reserve test whether or not S7600 or A8945 ever passes. The difference is that the lender's test has no ten-year cure window. Our New York reserve studies page covers what is required today, and our budget approval page covers who decides.

A drafting problem that has already been overtaken

Four separate 2025–2026 bills all propose to add Real Property Law § 339-mm — these two reserve bills, the condominium owner's bill of rights, and the inspection-disclosure bill. That was always a problem, because only one could be enacted as drafted.

It is now a bigger problem, because § 339-mm already exists. Part GG of Chapter 56 of the Laws of 2025 — the 2025–26 budget — created a Real Property Law § 339-mm headed “Establishment of reserve fund and dedicated capital fund for buildings converting to condominium ownership under section three hundred fifty-two-eeeee of the general business law.” It took effect November 5, 2025 and is codified.³

So New York does now have a statutory reserve-fund duty in the Condominium Act. It is just an extremely narrow one: it applies only to a condominium created through a § 352-eeeee “preservation plan” conversion in New York City. An ordinary New York condominium or co-op is not touched by it, and “New York enacted a condominium reserve fund law” does not reach them.

It is worth knowing what that narrow section does, because it is the only model in New York law of what a statutory reserve duty looks like. The fund is set at “three percent of the total price” on one formula, with a one percent floor; a separate dedicated capital fund runs at “one-half of one percent of the total price”; the board must report to unit owners and the housing finance agency “on a semi-annual basis with respect to all deposits into and withdrawals from the reserve fund”; and any waiver is void. And subdivision 1-a puts the residual risk on the board: “In the event that the funds are insufficient, unless the relevant housing finance agency provides otherwise, repairs and capital improvements necessary for the health and safety of the residents in all common areas and building infrastructure shall be at the sole expense of the condominium board of managers.”

Both reserve bills' effective-date clauses read: “This act shall take effect on the one hundred eightieth day after it shall have become a law.” Neither has been enacted, and neither can be enacted at § 339-mm without renumbering.