FISP and the Fixed-Income Dilemma

Co-ops and condos with a high ratio of older residents that qualify as Naturally Occurring Retirement Communities (NORCs) are facing a dilemma citywide. Every time the Facade Inspection and Safety Program (FISP) cycle or some other major capital project comes around, boards have to get creative with their financing – or risk pricing out their senior citizens.

Iris Newsum, the board president at Northridge 1, a 330-unit co-op in Jackson Heights, Queens, has faced this predicament repeatedly for the last 18 years. During Newsum’s tenure, Northridge 1, part of a cluster of eight NORC co-ops, has been through three FISP cycles, also known as Local Law 11, as well as numerous capital projects. For each FISP cycle, the co-op has had to come up with an average of $2 million.

“We cannot assess, because it would mean that our seniors’ monthly maintenance would increase significantly,” she says.

The local NORCs consortium tries to help, but there’s no magic bullet. “People come to us, looking for ways to reduce their monthly cost of living,” says Karen Taylor, director of the Northridge, Brulene, Southridge NORC program. “We also get phone calls from co-op boards to alert us in advance that they need to raise their fees, and they ask us if we can reach out to those older adults to see if we can assist them to stay safe and independent in their homes.”

The NORC group helps secure tax abatements and other benefits these elderly shareholders are entitled to, but sometimes that’s not enough. “When those city codes go into effect,” Taylor says, “it can essentially price out longtime co-op shareholders.”

Conflicts with the DOB over FISP violations have only strengthened Newsum’s belief that something has to change. “They need to find a way to give co-ops like ours – those that are in good shape and always up to code – some kind of easement,” she says. “For instance, make FISP every 7 or 10 years instead of every 5. That would give us more time to come up with the money.”

Newsum is convinced her co-op’s problems are not unique. “This is not an issue just for my co-op,” she says. “This affects all low- and middle-income co-ops in the City of New York. This is not sustainable in the long run.”