FNYHC NEWSLETTER
Summer 2004

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ARTICLES
1. Executive Director's Message
2. New Members
3. President’s Message
4. Tax Abatement Extended
5. Know Your H2O
6. Federation’s Intensive Board Member Training
7. City Council Speaker Gifford Miller
8. Carbon Monoxide

EXECUTIVE DIRECTOR’S MESSAGE
By Gregory J. Carlson

On Saturday June 5th the Federation of New York Housing Cooperatives & Condominiums held its first annual, all-day educational conference. This conference is a revamping of our original tradeshow and educational program, but without the exhibitors. Over 100 people participated in the event held at the LaGuardia Marriott in Queens. Topics included financial and insurance issues, board functions and responsibilities, dealing with union employees, legislative updates, safety, energy, environmental issues, how to pick a manager/management company and free legal advice.

The feedback from the attendees was extremely enthusiastic and the response we received was overwhelmingly positive. A great deal of that success is due to our exceptional panelists at each session. Hand-picked because of their expertise in their respective fields, these professionals passed on important information and knowledge that was sorely needed by the co-op and condo board members and residents that attended.

In addition to a buffet lunch, each attendee was given a reference manual and resource guide. This manual contains submissions by the panelists summarizing their remarks. It is a valuable informational resource, and if you didn’t attend a session, you still went home with the material and contact information you missed.

I would like to thank those who made this day possible, the panelists and our sponsors and advertisers.
Their participation and support helped to bring important information to our members. Thank you one and all.

Please mark you calendars for the Federation’s next event that will be held on Sunday, September 19, 2004 at Penn South, our sister cooperative in their community room at 343 8th Avenue in Manhattan from 9 AM to 4 PM. This “Leadership/Strategic Planning Conference” is a must for every present and potential board member to attend. Two trainers from the National Association of Housing Cooperatives will present their two-day intensive training program in a condensed version. After all this is New York and we don’t have two days to set aside…right?

The first part of the session will allow you to evaluate your own leadership capabilities as they pertain to your role as a cooperative or condominium board member. You will learn about the leadership qualities needed to run a board and how to use this information to recruit new board members who will lead the board in the future.

The second part will be “Strategic Planning for Co-op/Condo Boards.” This session will discuss the very important issue of strategic planning as it relates to running your co-op or condo.

As our member buildings face more trying times it’s more important than ever to sharpen your leadership skills. Who should attend this important conference? Board members, committee members, shareholders and unit owners. Don’t let this opportunity pass you by. It’s only $50 per person for members. At least one member of every co-op or condo board should attend. Space is limited, so make your reservations early. Call 718-760-7540

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WELCOME NEW FEDERATION MEMBERS
Every day, week, month and year the Federation of New York Housing Cooperatives and Condominiums reaches another building in need, another vendor looking to expand his
clientele. Membership is accepted all year round. Listed below are new members to the Federation family.

Listed below are new members to the Federation family.

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PRESIDENTS MESSAGE
By Albert F. Pennisi

For many businesses and associations summer is a quiet time, but not for the Federation of New York Housing Cooperatives and Condominiums. We are constantly working on behalf of our membership, the cooperative and condominium community.

I would like to thank everyone, panelists, sponsors and attendees, who participated in the Federation’s first annual conference on June 5th at the LaGuardia Marriott. We had an outstanding educational program and, from all reports, everyone who attended was pleased with the information and the reference guide they received. We look forward to providing this service on an annual basis.

On September 19th the Federation is hosting a very important event and I sincerely hope that every board of directors sends at least two members. It is an all-day, intensive training session that will focus on leadership, working with a cooperative team, strategic planning and decisionmaking strategies. More information and a registration form are on page 6 of this newsletter.

Most importantly, the tax abatement extension for co-ops and condos was approved by the City Council for the next four years. This measure will save 17.5% for buildings assessed over $40,000 and 25% for those under $40,000. This did not happen easily. It is because of the tremendous efforts of many people, including our executive director Greg Carlson, our sister organization the Council of New York Cooperatives, various legislators and concerned cooperators that this extremely important legislation was passed.

Good work!

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TAX ABATEMENT EXTENDED
By Greg Carlson
On June 1, 2004 Governor George Pataki signed into law a bill that will extend the cooperative and condominium tax abatement program for another four years and the cooperative and condominium community breathed a collective sigh of relief!

I would like to take this opportunity to thank every one who helped to get this extremely important piece of legislation passed. Assembly member Pete Grannis and State Senator Frank Padavan really pushed to get this through the legislature quickly. The Action Committee for Reasonable Real Estate Taxes, of which the Federation is a proud part of, helped with their continuous lobbying efforts and grass roots support. All Federation members who sent their city and/or state legislators letters, I thank you.

A special thank you goes to Federation board member Dee Dee Goidel who was instrumental in Albany in explaining to the legislature the urgency of passage and the dramatic financial consequences to co-ops and condos if the bill was not passed before next year’s tax bills were configured.

Luckily, the bill was signed in time for the New York City Department of Finance to apply the abatements to the real estate tax bill starting July 1, 2004. Buildings did not have to pony up the extra money to make up the absence of the abatement and a higher tax escrow. Although the abatement is included in the tax bill, the distribution list, hopefully, will be issued by year’s end.

The City Council has not yet set the real estate tax rate, so there will be an adjusted tax bill in January 2005. When the rate is set that’s when the Department of Finance starts to work on the individual abatement list.

In the New York City budget accord between the City Council and the Mayor’s Office there may be an additional real estate tax rebate for homeowners (including owner- occupied cooperatives and condominiums). I say “may be” because this rebate needs Albany approval and as of this writing State Senator Joseph Bruno is holding up passage as part of the New York State budget deal.

The $400 rebate reported by the newspapers does not really translate into $400 in your pocket. Number one, if you itemized your deduction and the real estate tax was part of your itemized deduction, then the rebate is taxable. Number two, if the calculation from the executive budget is still part of the newly agreed upon budget, co-ops and condos will get approximately $285, not $400.

The Department of Finance was originally going to start mailing the rebate checks in September, but without a New York State budget deal all DOF can do is hold their breath. In addition, some newspapers have reported that in order to get the rebate you must apply for it as you do in the STAR program.

We’ll keep you posted.

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BE KNOWLEDGABLE ABOUT WATER
By Rivka Karasik, Business Development, Ashokan Services

The DEP is raising its combined water/sewer rates by 5.5%, from $3.94 to $4.14 per hundred cubic feet (748 gallons), making water one of the largest costs in operating a building. The new rates are effective from July 2004 to June 2005 and apply to both metered and frontage accounts. The cost of water has risen dramatically over the years and water conservation now equals real financial savings.

People are not used to considering water conservationmeasures since water “just didn’t used to cost so much.” Conservation measures can greatly reduce your water bill and should definitely be included in your yearly budget. You should budget time and/or money for:

• energy audits;
• inspection of HVAC and
• mechanical systems;
• installation of cooling tower
• meters;
• sub-metering your commercial
• tenants;
• low consumption fixtures;
• bill audits.

The first step in preparing your budget is to determine whether your building is being charged frontage or metered rates. If your building is being charged frontage rates you should perform an analysis to see if it would be cost effective to switch to metered billing. If your building is being charged metered rates, see if the water consumption falls within acceptable usage parameters.

An extensive database of the cost of water based on various demographics should be done, but as a simple rule of thumb, calculate that the average family of two will use $375.00 to $450.00 a year (add $52.00 per child.) If your buildings’ consumption is above these parameters you may have a fixable problem. Common problems include leaks, faulty HVAC equipment, unbilled commercial space and billing errors.

LEAKS can be detected through a water audit. The DEP will perform an audit at no cost for residential properties. We recommend that you take advantage of this offer whether your building is on frontage or metered billing

HVAC and mechanical systems should be surveyed by an engineer to determine if potential water savings exist. Some examples of savings include: reuse of Con-Ed steam discharge, installation of cooling tower meters and replacement of single-pass water-cooled equipment.

LOW CONSUMPTION FIXTURES generally have a fast payback as is detailed below. It obviously pays to replace showerheads, aerators and single pass condensers, However, you may wish to push off the replacement of toilet bowls and tanks until the city reintroduces its toilet rebate program.

SUB-METERS In many cases the high water/sewer charges reflect water being consumed by your commercial tenants. A recommendation for budgeting is to install sub-meters for every retail tenant. Building owners/managers may be hesitant to install water meters in spaces with low consumption, but we find that if there is a leak, your tenants are more likely to have it repaired quickly if they are paying for it. If none of the above works to reduce your consumption, devote some time to having your water/sewer bills reviewed to see if there are any errors. You can budget time for your staff to do this or hire a consultant. Remember, by conserving water you are helping preserve our earth’s most precious resource while saving money on your buildings’ management costs.

Ashokan Water Services, Inc. is a full service water management company featuring rate analysis, bill auditing, automatic meter reading, and meter installation and conservation studies.

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FEDERATION OF NEW YORK HOUSING COOPERATIVES AND CONDOMINIUMS TO HOST SPECIAL ONE-DAY TRAINING SESSION FOR BOARD MEMBERS
Nationally Recognized Instructors To Present Leadership Training And Strategic Planning Program For Co-op and Condo Board Members On Sunday, September 19

The Federation of New York Housing Cooperatives and Condominiums (Federation) will host a special, one-day intensive leadership training and strategic planning session for cooperative and condominium board members on Sunday, September 19, 2004 from 9 AM to 4 PM at the Penn Station South community room, 343 Eighth Avenue, Manhattan. Linda Brockway and Marlene Dau, two nationally recognized experts in the field of cooperative housing, will present a concentrated version of their acclaimed two-day workshop for board members.

The morning session “Advanced Leadership Training” assists the student in evaluating his/her leadership capabilities as it pertains to their role as a coop/ condo board member. This session focuses on crucial leadership qualities that are needed to be an effective and responsible board member, how to evaluate the various board functions and how to determine the best people for the right positions. The second half of the program will discuss strategic planning, its correlation to the structure and organization of an effective and efficiently operating co-op board. Discussions will center on the basic functions of leadership and the strategy of a leader, decision-making strategies and how to work together to develop a strategic plan. The Federation’s mission is to present educational and informative programs for our members, the cooperative and condominium board members of New York City. This program provides an exceptional opportunity to gain an understanding of the responsibilities associated with being part of a cooperative team.

We encourage every board to send at least one or two members for this essential learning experience. The fee for Federation, Council of New York Cooperatives (CNYC), Coordinating Council of Cooperatives (CCC), HDFC and Mitchell- Lama Council members is $50. Non-members pay $100. Educational materials and lunch are included. Reservations are requested as seating is limited. Call 718-760-7540 or visit www.fnyhc.coop.

WHERE: Penn South
343 Eighth Avenue, NYC
Community Room
WHEN: Sunday, September 19, 2004
TIME 9 AM - 4 PM
COST:$50 - Federation and CNYC members
$100 non-members (Fee includes lunch and educational materials)

This two-part workshop will allow you to evaluate your own leadership capabilities as they pertain to your role as a co-op board member. You will learn about those crucial leadership qualities that are needed to be an effective and responsible member of a board of directors and how to use this information to recognize and recruit new board members.

Leadership Part I: Advanced Leadership Training
The leadership training class will provide an opportunity to take a self-appraisal. This evaluation will assist you during our "Leadership as a Board Member" class. You will also be able to evaluate the different board roles and determine how to "stack" your board with the best people in the right positions.

Leadership Part II: Strategic Planning for Co-op Boards
The second half of this two-part session will discuss strategic planning, its correlation to the structure and organization of an effective and efficiently operating co-op board. There will be discussions of the three keys to sustaining success, as well as discussions on leadership and partnerships, basic functions of leadership and the strategy of a leader. We will learn leadership steps, decision-making strategies and how to work together to develop a strategic plan.

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City Council Speaker Gifford Miller Announces Passage Of Tax Abatement Bill
By Gifford Miller

As I stated in my 2004 State of the City address I believe in fair taxation. I unveiled a proposal in regards to the large property tax rate hike that the City needed in order to close its budget gap. My long-term plan is to implement a permanent reduction in real estate taxes and a freeze for seniors on fixed incomes, not a one-time offering as Mayor Bloomberg proposes.

Early last year, when the City of New York was facing massive budget deficits, I went to Albany seeking specific legislation for “absentee” one-, two- and three family (Class One) properties.
The point of this legislation was to impose a surcharge on this particular category of real estate owner and target them because they are not truly homeowners, but rather landlords. This legislation passed and another inequity in taxation is now corrected.

As a fellow cooperator, I am painfully aware of the need to extend the cooperative and condominium property tax abatement. Since 1996 the abatement program has given shareholder and unit owners over one billion dollars in tax equity. It is essential that this program survive. It should be noted that, since the inception of the abatements, we have gone through three administrations that by law were charged to give Albany a “long term plan.” Each failed to do so. After we extend this year’s abatement for another four years, the City Council plans to carry the “long term plan” torch.

The City Council fully understands that whether you own vertically or horizontally you are a homeowner and should be treated as such under the law. It should not matter which category of homeownership you fall under, you are still a homeowner. This is why real estate taxes, between homeowners of Class One and Class Two, must be reformed and equalized.

We need the abatement extended so the City Council can do its work and put together a long-term plan for real estate tax fairness. My colleagues, Assemblyman Peter Grannis and State Senator Frank Padavan were instrumental in introducing bills in Albany that received the backing of the City Council and made the recent passage of the tax abatement possible.

Although there may be some who criticize the abatement program it is still “the best thing going” until the City Council picks up the gauntlet of “long term fairness.” To that you have my pledge.

Gifford Miller (center) receiving Legislator of the Year at the 2003 Federation’s 50th Anniversary Party from Federation President Albert Pennisi and Executive Director Gregory Carlson.

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CARBON MONOXIDE DETECTORS: IT’S THE LAW
By Geoffrey Mazel
61-20 Grand Central Parkway
Forest Hills, NY 11375
As we are all aware, carbon monoxide poisonings are extremely dangerous and potentially fatal. Benjamin Chu, MD, of the New York City Health and Hospital Corporation recently stated, “carbon monoxide poisoning is a tragic health hazard that can be prevented when people are well informed.” This issue is so important, both New York State and New York City have passed legislation requiring the installation in dwellings including cooperative units and condominium units.

New York State acted first in this regard. To protect against carbon monoxide deaths, New York State implemented legislation requiring carbon monoxide detectors installed in every one- and two- family home plus cooperative and condominiums units as of March 3, 2003.

The carbon monoxide detector must be UL certified and it must be placed in the vicinity of the bedrooms in your home. In addition, transfer agents, attorneys and title companies require an affidavit, similar to the smoke alarm affidavit, be signed at every transfer of a house, cooperative or condominium. This affidavit should state that the premises being transferred possesses an operational carbon monoxide detector on the date of the transfer.

Despite the good intentions of this law, the law did not apply to those dwellings in the City of New York. Fortunately, New York City has now passed its own carbon monoxide law, which is far broader than the state’s legislation. On May 5, 2004, Mayor Bloomberg signed the New York City Carbon Monoxide Law. The legislation will go into effect on October 5, 2004. It will have an immediate impact on cooperatives and should be read closely by all board members.

The New York City statute requires every dwelling unit where a “fossil fuel-burning furnace or boiler is located” and is in close proximity to a source of carbon monoxide to be equipped with an operational carbon monoxide detector within fifteen feet of each room used for sleeping purposes.

This law applies to all buildings, irrespective of when such building was constructed or a certificate of occupancy was issued. This law is clearly much broader than the state law, which only applies to dwellings transferred or constructed after March 2003.

It is the responsibility of the owner to ensure that their residence has an operational carbon monoxide detector. A notice must be posted in a common area that the owner is required by law to install carbon monoxide detectors in each dwelling unit. The city will require the owner of such dwelling unit to keep records as to the installation and maintenance of carbon monoxide detecting devices and such records must be made available to the city upon request.

Therefore, your board of directors should inform their shareholders of this new law and make sure everyone complies. It is a life saving measure that is inexpensive and simple to implement.

Mr. Mazel practices exclusively in the area of cooperative and condominium representation. His firm, Hankin, Handwerker & Mazel, PLLC, represents several significant developments in New York City. He is also a member of the Bar Association of the City of N e w Yo r k - C o o p e r a t i v e a n d Condominium Committee.

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