A good Board cannot make revenue and operating costs appear and disappear as needed. Our small building operates on a very tight budget, we have no frills and no services beyond garbage handling and exterminator, and trust me, there is no where to get the extra 7% tax hike from. A good board must raise maintenance to cover monthly op costs, and we also charge a 13th month assessment each year to allow for contingencies. Where would you suggest we cut our expenses? I think you have to be realistic when you say a board has to find "leaks" in the budget and stop them.

big buildings have lots and lots of leaks. insurance can be improved. always. water bills can be contested. etc. supplies. tax ceritoori. energy bulbs and better heating. overtime and better management of staff. there are leaks allover.

Just as in any small business, the budget is very carefully looked over to maximize the "bang" of every buck. Sometimes you only find a drip... not a leak. Once you plug that......

I'm a firm believer in finding new sources of income. Storage, fitness room, tag sales, calendar sales.... whatever it takes.

But even after all that, when the utilities go up in double digits, when the tax rates increase, when the insurance is consolidated with hundreds of other buildings to gain maximum coverage for minimum expense, when you've metered and submetered and monitored supplies and you've wrapped pipes, upgraded systems, etc........

sometimes the only thing left is to increase maintenance. Doesn't mean the Board is lazy, stupid, inefficient or anything else that's bad. Just responsible, as it should be.

In my view, broad generalities are not a suitable forum posting.

Our building (500 unit luxury building) has been practicing good management, fiscal responsibility and adhering to the tenets of fiduciary responsibilities for years.

So I will assert that in our building there are no more savings to be garnered from mundane day-to-day savings, e.g.; CFL bulbs, the newer LED bulbs, lowering building and lobby temperature (winter), raising hallway and lobby temperatures (summer), etc.

Deferring needed preventative maintenance or repairs is flirting with potential disasters and lack of services to residents.

Postponing capital improvements and the collection of capital reserves is not a viable option as one day the crescendo of required capital improvements will overwhelm our ability to pay.

So any well run co-op corporation has ready embarked on cost saving measures as a normal course of day-to-day business.

But, I will tell you that earlier this year we expended about $35,000 for an improved hot water monitoring and management system for our central site domestic and heating plant. In this case, the $35,000 is almost recouped in lesser natural gas costs and anything after this, is pure savings.

If we were to listen to others herein, we would not have had the funds to make the upgrade and to then recoup costs plus savings.

Our next venture, in the spring, is to install a new separate domestic hot water system that is about 95+% efficient. We will recoup costs by immediate savings and within three years we will have paid for the improvement and thereafter we will benefit with lesser natural gas cost usage which translates to more real dollar savings.

Without the funds today, e.g.: imbedded in our maintenance increases as well as our recurring yearly capital improvement assessment, we would be forced to delay the upgrade/replacement and thus forego savings.

Does anyone even think in this vein?

And, I must challenge other readers with this question? Have you ever designed a financial plan to pay off any underlying mortgage without ever refinancing the mortgage or taking out a larger sum? If yes, pat yourselves on the back. If no, then one must really do some serious introspection as to why you are squandering the shareholders monies to pay interest which is of no benefit to the shareholders and is only of benefit to the bank.

Yes, one may infer that we retired our twenty-five year old mortgage without ever succumbing to the easy way of refinancing and burdening future shareholders so current shareholders can obtain a free ride.

Our motto has been and always will be “pay as you go”.

And, to be clear, we compare our building with about six other nearby comparable properties and I will tell you, we with 500 units are the lowest cost (includes monthly maintenance, assessment and parking) building amongst six properties and 3,200 units. Our building’s shareholders have absolutely no mortgage looming over them while the average burden of the other six buildings and 3,200 units is $52,000 per unit in underling mortgage costs.

So tell me our plan has been wrong.

Oh, we have expended $16,000,000 in capital improvements since turning co-op twenty-seven years ago; all this while retiring the original debt of $8,000,000. And, as noted we are one of the lowest cost co-ops in the neighborhood.

Let me also mention that we raise maintenance every year. Our average increase maintenance and assessment)is 3.5% over all the years, and never have we had a double digit maintenance increase surprise or a mid-year adjustment or even hit folks with a mid-year bombshell assessment.

Yes, a subtle admonition to readers to think more wisely and more long term.

So who is lazy????

please see this article. taxes back to 2007 level - so this is somewhere in yoru budget. meantime, get a very very good tax ceriototi lawyer:

Friday, December 19, 2008
$400 Property Tax Rebates Will be Sent by Dec. 31, 2008
The City is finally sending out the $400 property tax rebate checks which were meant to
be mailed in October 2008. You should have your check before December 31, 2008 (That
is the good news!)

The bad news is the City is raising property taxes 7% on January 1, 2009. (Oy gevalt!)

Technically, the City repealed a tax cut of 7% that had been set to expire in June 2009, so
your property taxes will go back to about what they had been in January 2007. (Confused
yet? Read the whole story below).

December 19, 2008 The New York Times
City Council Approves 7% Property Tax Increase
By DAVID W. CHEN
Mayor Michael R. Bloomberg's $1.2 billion property tax increase won approval from the
City Council on Thursday, raising homeowners' bills by 7 percent as the city grapples with
a worsening economy and disappearing revenue.

As a result of the 33-to-18 vote, annual tax bills will increase by hundreds or in some
cases thousands of dollars, effective Jan 1.

"Even though it won't be popular, New Yorkers will understand," Councilman Miguel
Martinez of Manhattan said in explaining his support for the tax hike. "Times are hard, and
we're asking everyone to pitch in."

Opponents warned that residents were already overtaxed. Since Mr. Bloomberg took
office, property taxes have increased by 18.5 percent.

"Today, the Council votes to take the bucket to the same old well and ask homeowners to
bear the brunt of a swelling budget among dwindling revenues," Councilman Simcha
Felder of Brooklyn said. He added, "I believe that is unacceptable and that will hurt all New
Yorkers in this difficult time."

The property tax increase comes as Gov. David A. Paterson is pushing more than 100 new
taxes and fees on items from downloaded music to nondiet sodas, and the Metropolitan
Transportation Authority is moving to impose fare and toll increases.

Manhattan homeowners who live in the most expensive co-ops will see their taxes go up
by anywhere from $854 to $1,307, according to the city's Independent Budget Office.
People who own single-family homes valued between $1 million and $1.5 million, outside
of Manhattan, can expect to pay an extra $464 per year. Taxes on more modest homes,
such as a condominium in Queens in the $300,000 to $400,000 range, would rise by
$111.

To help ease the pain, Council Speaker Christine C. Quinn announced that Mr. Bloomberg
had agreed to send homeowners the much-prized $400 rebate checks by the end of the
calendar year.

The mayor had tried to eliminate the checks this year, then delay their distribution, but
council members animatedly objected.

In addition, the Council approved an increase in the hotel tax from 5 percent to 5.875
percent per room, or about $3 a night. That change is expected to generate perhaps $80
million between March and the end of the next fiscal year, in June 2010.

Still, no one was under any illusions that the increased taxes would be the last financially
difficult decision in the foreseeable future.

Mr. Bloomberg, who in September ordered all city agencies to cut spending by 5 percent,
asked that they come up with an additional 7 percent in cuts by Dec. 22. And even with
those cuts, and the extra revenue from higher taxes, the city is still facing a budget deficit
of more than $1 billion in the next fiscal year.

The vote on Thursday — a close one by City Hall standards — was the latest political
victory for Mr. Bloomberg.

He had unveiled his budget proposals just two weeks after the most bruising political
battle in recent memory: the Council's approval of his bid to rewrite the city's term limits
law, allowing him to seek a third term.

The co-op's attorney works FOR THE BOARD, not individual Board Members.

So.... any costs associated with this advice go directly to the individual.
And the attorney should be (at minimum) censured for agreeing to participate in the discussion.

If it were our Board, I think we'd do more than that.

This is not conflict of interest, but a potential ethical issue:

a. The board member should be charged, as stated before, for any time incurred in consulting the co-op counsel.

b. The board member has inside information regarding the apartment that he/she wishes to swap and wishes to trade it. Obviously, the board member is giving up his/her apartment for the more desirable apartment. There may be some money being paid for the difference in the cost. So, from that point of view, the only issue here is an ethical one of inside knowledge and advantage over other residents.

c. Do other shareholders know about the availability of this apartment and would other shareholders had the same opportunity to do the same consultations as the board member and come up with the same swapping scheme if they would have known the apartment was vacant?

d. Usually, you have shareholder who get interested in a larger or smaller unit and they sell their in order to buy the second unit. Wouldn't this be the case of your board member?


AdC

thanks for your response...the apt for sale was advertised to all shareholders and the apt is on the open market for sale. No one shareholder has expressed interest in the apt and we dont have any current offers. The apt is actually the same size, but on a higher one flight up. The shareholder would have to pay off her mortgage and sell her apt in order to gain the other apt.

thanks for you response. i learned that the board can create an internal resale policy to cover these types of situations which we will discuss. And we have been advised to write the board member a notice that she is not to contact the coop attorney for personal matters. I am checking to see if we need to do anything else. She lied to the attorney and misrepresented herself and the deal to get his assistance.

Rene - Just my opinion, but if your BM lied to your coop attorney to get his help, I'd consider that reason (misrepresentation) to reject any application by him/her to buy another apt in your coop. If this is serious enough, I'd personally also ask that BM to resign, or you and your other BMs should vote to remove him/her from the board.

I'd also put the cost of legal services for time that your BM spent talking to your coop attorney about this on his/her account. If any other shareholder did this, you'd charge him/her for it, wouldn't you?

This is just the kind of petty-tyrant overreaction I've come to expect from co-op boards. We're talking about somebody's home, about the place where they live and raise a family, and you want to reject an otherwise viable applicant because he/she made a fairly minor error in judgment or even -- have you thought of this? -- didn't realize that he/she talking to the board's atty was wrong? Either way, big freaking deal. Has anyone TALKED to the board member before getting all hissy-fitting?

Anonymous: My telling Rene her BM's lying to the coop atty may be reason to not let him buy another apt, voting him off the board, or billing him for the atty's time was my opinion. I don't see it as "overreaction." Please allow for the possibility that you overreacted. Here was your reply to me:

>>>This is just the kind of petty-tyrant overreaction I've come to expect from co-op boards. We're talking about somebody's home, about the place where they live and raise a family, and you want to reject an otherwise viable applicant because he/she made a fairly minor error in judgment or even -- have you thought of this? -- didn't realize that he/she talking to the board's atty was wrong? Either way, big freaking deal. Has anyone TALKED to the board member before getting all hissy-fitting?<<<

Anonymous, you don't know any more than anyone here if the BM has a family, is a viable applicant, made a "fairly minor error in judgment" or didn't know talking to the atty was wrong. That's your opinion, which you also have a right to. We don't have all the facts here of course but the fact that the atty gave the BM help may be a big deal. As others said here, he represents the coop, not individual SHs.If the BM didn't know it, the atty should have told him so.

Coop boards are not all petty-tyrants. Many of us do our best, treat all SHs fairly and equally, and act accordingly if a SH (BM or not) takes advantage of a situation. If that hasn't been true in your experience, that's unfortunate. It's unfair to give all boards a black mark when so many deserve credit for the good they do. I only ask that you keep that in mind. Thanks.

BP chastises Anonymous for suggesting giving the SH the benefit of the doubt, though Anonymous "doesn't have all the facts." Yet BP is ready to deny the SH application though BP him/herself doesn't have all the facts.

BP, you're the pot calling the kettle black. Perhaps you should have tempered your original posting.

JG, I did not intend to chastise Anonymous. I simply asked that s/he consider that all coop boards are not petty-tyrants as s/he seemed to indicate. Also, I am not "ready" to deny a SH's application to buy without my having all the facts. I began my posting to Rene by saying "Just my opinion". I offered suggestions in an effort to help Rene weigh the facts she has to determine how she might resolve or ameliorate her issue with a BM.

One benefit of Board Talk is being able to offer options, opinions and outcomes based on experience so that someone who asks for advice here can consider them in determining a course of action in a specific situation.

We are all here to learn from each other. It's impossible for any of us to know all the facts about another poster's issue. All we can do is offer advice or opinions that may be of help. If Anonymous or anyone was offended or felt that I was chastising, I do apologize. That was not my intention. We have enough conflict in our coops and in our own lives. We don't need more of it here.

Happy holidays, everyone ~

Try having your plumbing company take a look at see if they can determine where the odor is coming from. It would be cheaper than a engineer?

Hello, i'm a Live-Out Resident Manager with quite a bit of experience, You should really look into hiring a plumber to inspect your plumbing, also get your ventilation inspected. What i think might work for you, 1st locate the problem, and install an air purifier with CHARCOAL filters, this will eliminate the odors.

You should consult your by-laws and association papers to find out how many representatives from one unit may run. It may be that both representatives on the deed may run, but only one representative is allowed at the time as you understand it. Otherwise, a consultation to an attorney may be the most neutral way to resolve the problem without creating ill feelings on individuals and documentating once and for all similar situations in the future.

AdC

You should consult your by-laws and association papers to find out how many representatives from one unit may run. It may be that both representatives on the deed may run, but only one representative is allowed at the time as you understand it. A consultation with an attorney may be the most neutral way to resolve the problem without creating ill feelings on individuals and documentating once and for all similar situations in the future.

AdC

Try contacting the Union directly at 212-388-3800 ask for the contract department.

First, I would not call the union for clarification. The union will recruit all your employees, i.e., supers, porters, etc.

If the resident manager is a glamorized superintendent, who cares about the title, the resident manager is also recruited.

The best bet is to speak with the co-op counsel; he/she may refer the question to a colleage dealing in labor law and obtain clarification. Optionally, he/she may refer you to a labor attorney to handle the matter if the union is getting too close to your employees and you wish to fight the union.

AdC

First, I would not call the union for clarification. The union will recruit all your employees, i.e., supers, porters, etc.

If the resident manager is a glamorized superintendent, who cares about the title, the resident manager is also recruited.

The best bet is to speak with the co-op counsel; he/she may refer the question to a colleage dealing in labor law and obtain clarification. Optionally, he/she may refer you to a labor attorney to handle the matter if the union is getting too close to your employees and you wish to resist the union.

AdC

Yes, we resident managers are union.

hi - do you have a tax ceriotori (sp?) lawyer working to keep down your taxes?
Can you let me know the answer by posting. Thanks

Also have checked your water bill? we got 20k back for over-billing. If you take good , effective measures - you can reduce your increase to 7%

Hi, Cathye,

Our maintenance is going up slightly (about 4%) because the city council is increasing property taxes 7%, electricity will be going up as much as 10%, and with few apartment sales we are earning only a tiny bit from flip taxes. On top of that, inflation in 2008 is at about 3.5%.

One of any board's salient responsibilities is to keep the business running in the black. That way your investment remains valuable (for a different way of running a business, Google "Lehman Brothers" or "AIG").

Investors look for sound businesses when they want to invest money and get a decent return. That holds true whether they're investing in Citibank (a bad decision) or a co-op (a good decision, at least in the case of the one I live in).

Remember, a co-op is like any other business: it buys goods (utilities, fuel, paint), hires employees (super, property manager, accountant), and faces uncertainty (will the city council raise taxes again?). All of those costs change with inflation. And by "change" I mean "increase."

Any corporation, whether it's a car maker or a co-op, that doesn't budget wisely for increased costs is bound to fail. (If you're not convinced, Google "GM.") A co-op that doesn't raise maintenance fees to match its costs either has a tremendous sum in reserves and lives off the interest (think: Park Avenue) or needs a new board, one that isn't afraid to face reality even when shareholders are.