Who Sets the Number, When You Get to See It, and What You Can Do About It

Most owners meet the budget once a year, as a number on a notice, and it's usually higher than last year's. What the notice rarely explains is that the number is the end of a process the law governs: who prepares it, when they have to show it to you, what has to be inside it, and what you can do if you think it is wrong.

What Counts as a Common Expense?

Section 57-8a-102 does the defining work. A common expense is a cost the association incurs to exercise a power in its governing documents. An assessment is a charge imposed on a lot or a lot owner in accordance with a governing document recorded with the county recorder, and it includes a common expense. The authority to charge you traces back to something on file at the recorder's office, not to a decision made in a meeting you did not attend.

Section 57-8a-201 sets the obligation: an owner pays a proportionate share of common expenses and any other assessments, in the amount and at the time the board sets under the declaration or bylaws. An assessment is a debt of the owner from the moment it is made.

Does the Board Have to Adopt a New Budget Every Year?

Yes. Under Section 57-8a-215, the board shall prepare and adopt a budget at least once a year and present the adopted budget to the members at a meeting of the members. Both halves matter. Adopting a budget in a board meeting and never showing it to anyone does not satisfy the section.

One fallback exists. If the board never adopts a budget, or the owners disapprove of the one it adopts, the last adopted budget remains in effect until the board adopts a new one. That covers a failed year; it is not a substitute for doing the work.

Owners Get Two Separate Vetoes

Owners do not have the right to vote to approve the budget, but they do have the right to disapprove. Each disapproval vote aims at different targets, and their clocks start on different events.

The whole budget. Under Section 57-8a-215(3), an adopted budget is disapproved if, after adoption, at least 51% of all allocated voting interests vote to disapprove it at a special meeting called for that purpose by lot owners under the declaration, articles, or bylaws, within 45 days after the meeting at which the board presented it.

The reserve fund line item. Under Section 57-8a-211(7), owners may veto that line item alone by a 51% vote, at a special meeting they call for the purpose, within 45 days after the association adopts the budget. If they do, and an earlier budget had a reserve line item that was never vetoed, the association funds the reserve according to that earlier one.

The budget clock runs from the presentation meeting. The reserve clock runs from adoption. Those may be different dates. Both votes require owners to call the meeting themselves; the board has no duty to organize a vote against its own budget.

The Reserve Analysis

Unless the governing documents say otherwise, Section 57-8a-211 requires a reserve analysis at least every six years, with reviews and updates, if necessary, at least every three years. It must list the components that will need reserve funds, state each one's remaining useful life, estimate repair or replacement costs, estimate the annual contribution needed, and recommend a funding plan. Owners receive a summary each year and a full copy upon request.

The budget must include a reserve fund line item in an amount the board deems prudent based on the analysis, or higher if the governing documents require it. There is no statutory floor.

If the association skips the summary, the line item, or the veto process, an owner can sue for an injunction, for $500 or actual damages, and for costs and fees. That route requires 90 days' written notice first.

Where the Money Has to Sit

Section 57-8a-230 is short and strict: all association funds must be kept in an account in the association's name and may not be commingled with anyone else's, including a manager's operating account.

Section 57-8a-211 provides that the reserve fund is kept separate, may be used only for its stated purpose unless a majority of members approve otherwise, and may not be used for daily maintenance unless a majority approves or a covered budget shortfall exists. Members can shut off that shortfall use by a 51% vote on 48 hours' notice. Reserve money also may not fund a legal action against a declarant after the period of administrative control under Section 57-8a-229.

What the Law Does Not Require

An audit. The word does not appear anywhere in the Community Association Act. No Utah statute requires a community association to obtain an external audit. Many governing documents do, but that duty comes from the documents, not the state.

Generally Accepted Accounting Principles. The Act does not require GAAP either. It requires that the records exist and that owners can access them.

Your Right to the Paperwork

Section 57-8a-227 gives every owner the right to inspect and copy association records, including the budget documents, the most recent financial statement, and the reserve analysis. A written request must include six things: the association's name, your name, your property address, your email address, a description of what you want, and whether you want to inspect or copy it.

The association has 10 business days. Miss it, and for the governing documents, the most recent approved minutes, and the most recent annual budget and financial statement, the association owes $25 per day beginning on the eleventh business day, plus the reasonable costs of inspection and copying, and reasonable attorney fees.

What Happens When an Owner Stops Paying

The shortfall does not disappear; it shifts to the neighbors. Each collection tool carries a condition that is easy to miss.

• Late fees and interest. A late fee may not exceed the greater of 10% of the assessment or $50, and interest on the assessment and late fee may not exceed 1.5% per month. Those are ceilings, not entitlements.
• The fee schedule first. Under Section 57-8a-201(5), before imposing any such fee, the board must adopt a fee schedule by rule under Section 57-8a-217 and give a copy to every lot owner. No published schedule delivered to owners, no fee.
• Liens and loss of privileges. Section 57-8a-301 gives the association a lien on the lot for assessments and collection costs. Under Section 57-8a-309, the board may cut off a utility the owner pays as a common expense, or recreational access, but only if the governing documents authorize it, only after notice is given to the owner with at least 14 days to pay, and not at all if the owner asks for a hearing within 14 days until that hearing is held and decided.

Foreclosing without a court is harder than it looks. Under Section 57-8a-303, the association must give 30 calendar days' notice, and the owner may instead demand judicial foreclosure. It may not use nonjudicial foreclosure if the lien includes a fine, or unless the lien includes an assessment more than 180 days delinquent.

Where to Go Next

If you believe your association has not followed a requirement on this page, the Office of the Homeowners' Association Ombudsman can issue an advisory opinion on whether a state statute was violated. 

Reviewed against the Utah Code, current as of August 10, 2026.