The Tracking Sleuths

Services that alert buildings about violations and fines are growing up.

Three years ago, computerized violation-tracking and alert (CVTA) services were considered nonessential by some in the management industry. Today? They’ve gone from cutting edge to cutting board – just another everyday tool.

Why?

One reason is that there are more regulations than ever before – and, consequently, more chances to lose track of a violation. “The city is famous for ‘nail and mail,’ where they post a violation to [a property’s] front door, and you never see it,” says Ira Meister, president of the management firm Matthew Adam Properties. “You used to just find out about violations when you got a notice that you’ve defaulted on a hearing and it’s a $1,000 fine.”

Indeed, with fines for violations spiraling upward, managers can’t take a chance in losing paperwork and getting fined. “The late-filing fee for elevator inspection can be up to $3,000,” explains Paul Gans, director of operations at New Bedford Management. Dan Wurtzel, president of FirstService Residential (formerly Cooper Square Realty), notes: “It only takes one misstep where a violation for some reason is not mailed to the building or to the managing agent, and a hearing date is missed, a notice of violation goes to default, and you now have to pay a [large] fine and reopen the case.”

Meister says that since he has used a violation-tracking service, “If one of my buildings gets a violation today, tomorrow I will know about it.”

Sea Change

The last three years have seen major shifts in both inspection protocols and in how co-op and condo management is expected to respond. The Façade Inspection and Safety Program – formerly the well-known Local Law 11/98, so, see, that’s a confusing name change already – was amended last year, for instance, and now includes balconies after one fatally gave way in July.

That’s why CVTA has become more common. As technology improves in leaps and bauds, these services have become a veritable Swiss Army knife for managers. Most of the companies that track New York City building violations are developing mobile apps and adding new sources of data, including some state and federal databases. They’re also devising new ways to parse, analyze, and present all this information for easier understanding – including “translating” identical things that different agencies call by different terms.

At least four companies – Alert Service, DOB Alerts, SiteCompli, and Empower NY (no relation to the New York State energy-saving program EmPower New York) – compile data from such city agencies and offices as the Department of Buildings (DOB), Department of Finance, the Fire Department of New York (FDNY), the Department of Sanitation, and the Environmental Control Board (ECB). Delivered as e-mail alerts and compiled reports to managing agents – or to the boards of self-managed buildings that subscribe – the data include not only inspector-issued violations but also 311 complaints about your building, upcoming deadlines for filing required paperwork, calendar alerts, and more.

Elevator violations, for instance, are the single most common type the DOB issues, according to many property managers and tracking companies. An inspector will issue a violation “that may or may not get to the building owner [or manager] in a timely fashion,” says SiteCompli co-founder Jason Griffith, “and it’s not uncommon for the [paper] copy [of the violation] to get misplaced.” Violation-tracking companies alert the property manager as soon as the violation enters the city’s computer system, so the manager is immediately aware.

The companies can also give alerts before violations are even issued. “Someone walking down the street reports a dangerous construction issue at your building,” says Empower NY chief executive officer Jack Wurtzel. “It takes the DOB [an average of] 9.6 hours to respond to a reported dangerous issue, which is a pretty quick response. All of us in this market will send you a DOB alert,” he says, adding that Empower supplies it “within four minutes of the call being placed.” This gives boards and others the chance to correct the issue before an inspector arrives and issues a violation. “Complaints get addressed before they turn into full-fledged violations, which saves our buildings money,” says Stephanie Cardello, FirstService Residential’s director of compliance.

Violation-tracking companies can alert the property manager as soon as the violation enters the city’s computer system, so the manager is immediately aware. SiteCompli, additionally, has a companion site, Viocopies.com, at which a subscriber can enter the elevator violation number and download the document for printing – often needed for things like refinancing.

“Traditionally you’d send an expediter to the DOB, where they’d file to get a copy and wait for weeks for it,” Griffith says. Michael Jaffa, chief operating officer of Alert Service, says his company provides this data as well, included in the monthly cost.

Tracking software can also let you refute the city when it claims something wasn’t done when you have documentation that it was. “We can see if the DOB says an inspection wasn’t done, but we have a report showing it was done and it’s simply that the DOB is backed up 60 days,” says Cardello. In fact, she amends, “Sixty days is being a little kind. Last year, they were backed up six months.”

“Our success rate in actually challenging violations has gone up dramatically,” says Meister. “We received a ridiculous construction violation that made no sense.” The company he uses, Alert Service, “was able to decipher it for us, and they went with our property manager to the hearing and the violation was dismissed.”

Who Pays?

One thing about CVTA hasn’t changed, however: management companies are still ambivalent about who pays for the service. Some, like FirstService, absorb it as the price of doing business. Others, such as Kaled Management, pass the cost along to boards, though, as Peter Lehr, the company’s director of management, notes, “It’s an optional service. Some [boards] grab it, some say it’s a lot of money. I’ve had some larger buildings say no to it, and I’ve had some smaller places enthusiastically grasp it.”

What kinds of numbers are we talking about? SiteCompli and Empower charge in the neighborhood of 85 cents to one dollar per apartment per month. Alert Services, a product of the real estate consultancy Jack Jaffa & Associates, charges $10 per building per month. DOB Alert, a basic service with no bells and whistles, ranges from $9.95 a month for one property to $199 a month for 200 properties.

“When you’re looking at your board and saying, ‘It’d be great if you signed up, it makes your lives and our lives much easier and it protects your property in many ways, but it’s $5,000 a year,’ a lot of boards look at you and say, ‘This is kind of your job and we want you to pay for it,’” says New Bedford’s Gans. “But it benefits everybody involved. Some boards approve it right away and some boards question it. But it’s leaving the building exposed if you don’t have it, so it’s very similar to having insurance.”

What next?

The latest innovation in violation-tracking is access to fire department data. “The FDNY doesn’t have a digital database for the public the way the ECB does,” says Gans. But they’re starting to open up the doors and give access to these violation-tracking companies. Empower collects data directly from the FDNY’s internal database. In addition, Empower “has state agencies and even some federal agencies now.”

And with this explosion of data, most of the companies are savvy enough to realize, as SiteCompli co-founder Ross Goldenberg puts it: “You can have data paralysis by having too much data. It has to be the right data at the right time.”

“Replacing the overload of paper with an overload of e-mail is not helpful,” says Empower’s Wurtzel. “We normalize the data, using data from many sources to create a bigger picture that will help proactively avoid future issues and identify future risks.” He refers to “the textonomy of data,” using a word from academia that means, essentially, “making it all the same language, so we speak the same thing. One agency calls something one thing and another calls it something else.”

Ultimately, says Rialto Management president Scott Lerman, getting violation information immediately is just better for buildings. “Seeing on my phone that the DOB has issued something, I can send someone to fix it right away rather than seven days later after getting a [paper] letter or violation notice. We’re still paying fines,” he says of such cases, “but I’d rather fix something on day one than day eight.”