MD HB1041

Homeowners associations experiencing "exigent financial circumstances" (natural disasters, fraud, embezzlement, or similar emergencies) may temporarily deviate from reserve funding requirements by adopting a reserve recovery plan within 90 days

Reserve recovery plans require two-thirds majority approval from the governing body and must detail the circumstances, damage costs, and strategy to restore required funding levels

HOAs may deviate from reserve funding requirements for a maximum of 3 calendar years per exigent circumstance, with quarterly progress updates required to lot owners

Violations by an HOA governing body constitute unfair, abusive, or deceptive trade practices under Maryland Commercial Law, exposing them to enforcement penalties

Lot owners who suffer damages from violations may sue for injunctive relief and monetary damages; the law takes effect October 1, 2025