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A lot of coops don't have a flip tax and they're surviving financially. Some are in A-1 shape, some are OK, and some are barely getting by. But the same could be said for bldgs that do have a flip tax. Most hold the funds from a flip tax in reserve for capital improvement projects, but some use it to pay off bills, etc. Flip tax or not, I think how well a coop is doing financially depends on how well funds are managed and utilized by the board/mgmt.
More and more bldgs are adopting a flip tax or enacting a fee on the sale of shares. It's a hedge against rising costs and a good way to raise money (in part or full) for bldg projects/upgrades without having to hit every Sh in the wallet more often than you have to.
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You wrote, "I think how well a coop is doing financially depends on how well funds are managed and utilized by the board/mgmt."
Also remember there was a real estate tsunami not all that many years ago, and many buildings that had just gone co-op got caught short of the pier with foreclosures on Shareholders converting from tenancy to ownership who drowned in the economic squeeze of the times.
Our co-op was a victim of this (I sometimes grow concerned about a repeat period involving subprime mortgages). Not ALL financial problems stem from ill managed or ill utilized funds. Some buildings have had to climb a long way back from a precipice that no one foresaw or could prevent, and certainly did not result from misuse or mismanagement of co-op funds.
In the case of our co-op, we survived that period on luck, skill, and pure determination (as well as the judicial application of flip tax income to badly needed repairs of our infrastructure), and are now safely on shore.
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