Contingency fund study: coming into force in Quebec

The coming into force of the contingency fund study in Quebec raises many questions for condominium syndicates. Dates, obligations, and required actions: here is what you need to know to remain compliant.

Contingency fund study: what changes with Bill 16

Why the regulation evolved

In Quebec, many condominiums have long underestimated long-term maintenance costs. This situation has led to poorly maintained buildings, significant special assessments, and conflicts between co-owners.

The reform introduced by Bill 16 aims to correct these issues by imposing more rigorous and transparent management. To better understand these changes, consult our guide on Bill 16 condominium obligations. The goal is simple: ensure that every condominium has the financial resources required to properly maintain its building.

New obligations for syndicates

With Bill 16, condominium syndicates must now obtain a compliant contingency fund study. This study must be carried out by qualified professionals and based on a technical analysis of the building.

It must determine the contributions required to ensure the long-term sustainability of the property based on upcoming work. For a complete overview of the reform, consult the RGCQ dedicated page.

What was not mandatory before

Before this reform, syndicates were required to maintain a contingency fund, but without the obligation to base it on a structured study.

In practice, this meant that many condominiums contributed arbitrarily, often insufficiently. Bill 16 now regulates this practice and requires a data-driven approach. The CondoLegal practical guide outlines the history of this legal obligation.

Coming into force: key dates to know

Official coming into force date

Bill 16 was adopted on December 5, 2019. However, the obligation to carry out a contingency fund study comes into force with regulations adopted on July 30, 2025 (Order in Council 991-2025), effective August 14, 2025.

These regulations define technical requirements, update frequency, and the professionals authorized to conduct these studies.

Transition period

A transition period is provided to allow condominium syndicates to comply with the new requirements.

As of August 14, 2025, new condominiums must comply immediately. Existing condominiums have a maximum period of 3 years to obtain their first compliant study.

Deadlines to meet

Existing condominium syndicates must therefore complete their contingency fund study no later than August 14, 2028.

After that, the study must be updated every 5 years to remain compliant with regulatory requirements.

Waiting until the last minute carries significant risks, including high demand for qualified professionals and potential delays in obtaining a compliant study.

Who is affected by the obligation

Types of condominiums covered

All divided condominiums in Quebec are subject to this obligation, regardless of size or construction year.

Whether small buildings with only a few units or large, complex condominiums, each syndicate must ensure its contingency fund is based on a compliant and up-to-date study. This requirement aims to standardize practices and ensure more rigorous financial management across the province.

Possible exceptions

At this time, there are very few clearly defined exceptions. The regulatory trend is to standardize practices across the entire market to avoid disparities between condominiums.

Some specific cases may exist depending on building type or configuration, but they generally do not exempt a syndicate from compliance. In all cases, it is recommended to consult professionals or legal advisors to fully understand applicable requirements.

Small condominium cases

Small condominiums are often the most vulnerable, as they have limited financial and administrative resources.

However, they are equally subject to the regulation and must adapt. Proper planning is essential to avoid a significant financial impact on co-owners. Anticipating costs and spreading contributions over time helps reduce the risk of unexpected special assessments.

What a compliant study must include

Component analysis

A contingency fund study must include a detailed analysis of building components such as the roof, windows, mechanical systems, parking areas, and structural elements.

This analysis assesses their current condition, remaining lifespan, and required interventions in the short, medium, and long term. It forms the foundation of reliable financial planning.

Cost projections

The study must also include projections of future costs, taking into account inflation and changes in material and labour costs.

These projections help anticipate major expenses and avoid deficits. They also provide better visibility for co-owners regarding upcoming investments.

Financing plan

Finally, the study must include a financing plan outlining the required contributions to the contingency fund.

This plan ensures a fair distribution of costs over time and helps avoid sudden increases in fees. It also helps maintain an adequate fund level to cover future work.

What are the consequences of non-compliance

Financial risks

An insufficient contingency fund can lead to significant special assessments. These unexpected contributions can place considerable financial pressure on co-owners and create tension within the condominium.

Legal risks

Failure to comply with obligations can also expose the syndicate to legal action or increased liability.

Poor management may be challenged by co-owners, and board members could be held accountable in cases of negligence or failure to meet their obligations.

Impact on unit value

A poorly managed or non-compliant condominium may lose market value.

Buyers are increasingly attentive to the financial health of the syndicate, and an insufficient contingency fund can become a major obstacle when selling a unit.

What to do now (action plan)

Assess your current situation

The first step is to determine whether your contingency fund is currently sufficient and based on reliable data.

Reviewing financial statements, current contributions, and planned work helps identify any gaps.

Hire a professional

It is strongly recommended to hire experts to carry out the study. To better understand what a complete study looks like, you can consult our detailed example of a contingency fund study. Their expertise ensures reliable, compliant results tailored to your building.

Update your fund

Once the study is completed, it is essential to adjust contributions to ensure compliance and long-term financial stability.

This may involve gradually increasing fees to limit the impact on co-owners.

Cost and how to prepare

Average cost in Quebec

The cost of a study generally ranges from $3,000 to $10,000, depending on the size, complexity, and condition of the building.

Factors influencing cost

Several factors influence pricing, including the number of units, building age, complexity of components, and accessibility.

How to budget

It is recommended to include this expense in the syndicate’s financial planning to avoid a significant financial impact on co-owners.

Planning ahead allows costs to be distributed more evenly and ensures a smoother transition to compliance.

Conclusion

The coming into force of the contingency fund study marks a major turning point in condominium management in Quebec.

This requirement aims to improve planning, protect co-owners, and preserve property value.

Preparing now helps avoid risks and ensures a smooth transition toward these new requirements.

Frequently Asked Questions (FAQ)

Is the study mandatory now

Yes, it is part of regulatory requirements currently being implemented.

Who pays for the study

The cost is covered by the condominium syndicate and shared among co-owners.

What is the difference with the maintenance logbook

The maintenance logbook focuses on building upkeep, while the contingency fund study focuses on financial planning for major work.