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Council of New York Cooperatives & Condominiums
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Published: Autumn 2013

To be successful in promoting the needs of housing cooperatives and condominiums and protecting their interests, CNYC and its sister organizations seek consistently to make lawmakers and government officials aware of our issues, and of how important cooperatives and condominiums are to the stability of their communities and the City as a whole. When a number of organizations work together, their impact is increased and a group effort can often accomplish what one organization could not have done alone.

MAYORAL CANDIDATE INTERVIEWS
In April, six key New York City organizations for cooperatives and condominiums met to decide how best to learn what candidates for Mayor thought about issues important to New York City cooperatives and condominiums and their residents.

The group invited each of the candidates to a one-on-one video interview. CNN journalist Myron Kandel agreed to moderate these interviews, and candidates were contacted with many choices of studio time. Naturally, they all have busy schedules, and sometimes conflicts arose at the last minute to prevent scheduled meetings.

In the end, five Mayoral candidates came to meet with us. Please visit the CNYC website at www.CNYC.coop and spend some time viewing the interviews that Mr. Kandel did with Sal Albanese, Adolfo Carrion, John Catsimatidis, John Liu and Christine Quinn.

Included with the invitation to each candidate was the position statement in the box to the right, which you may find helpful as you prepare to be the best possible advocate for your cooperative or condominium when talking with Mayoral hopefuls as well as with candidates for City Council, for Borough President or for Comptroller or Public Advocate.

Once election day has passed, CNYC will begin the task of getting to know newly elected officials and the staffs that they will appoint, and will try to help them become familiar with and responsive to these key issues and others that arise that are important to cooperatives and condominiums. Your help in doing the same will make us all the more effective.

WHY WE NEED MAYORAL CANDIDATES TO THINK ABOUT HOUSING COOPERATIVES AND CONDOMINIUMS

Housing cooperatives and condominiums are the home of more than 500,000 New York City families, at every level of the economic spectrum. Today, cooperatives and condominiums are found throughout the City, providing opportunity for home ownership that is affordable: shared space and building systems bring economies of scale, enable members of cooperative and condominium communities to live comfortably at reasonable cost, and provides each shareholder and unit owner with the opportunity to participate in the governance of their home. Another benefit of cooperative living is more modest energy demand and thus a smaller carbon footprint as compared with individual private dwellings.

But cooperatives and condominiums are indeed multiple dwellings, and, as such, we are subject to many requirements, filings, registrations, all well intentioned, of course, but many placing significant financial burdens on the resident owners. It is our hope that the next administration will address these unfunded mandates, and will seek ways to mitigate their impact. Ways need to be found to distinguish this form of owner occupied and governed housing from rental buildings.

For decades it has been acknowledged that the property tax system currently in place in New York City imposes property taxes on home owners in housing cooperatives and condominiums that are considerably higher than the taxes paid by owners of one, two and three family homes of comparable value. It is our hope that the next administration of the City of New York will take a careful look at property taxes and seek a more equitable system. It is vital to the long term vibrancy and viability of New York City that affordable housing be consistently available to New Yorkers who work at the modest jobs that fuel our tourist industry, our vast public transportation system, the maintenance of our buildings, our roads, our bridges, and tunnels, and those employed by government itself. New York cannot be allowed to devolve into a city of the very rich and the very poor. We strongly believe that cooperative and condominium home ownership – self-governing, energyconscious, strongly committed to this city and to the local community – can and should be an important part of the answer to this need. As a candidate for Mayor of the City of New York, we ask you to share your views with our members.

  • The Action Committee For Reasonable Real Estate Taxes
  • The Association of Riverdale Cooperatives (ARC)
  • The Coordinating Council of Cooperatives (CCC)
  • The Council of New York Cooperatives & Condominiums (CNYC)
  • The Federation of New York Housing Cooperatives and Condominiums (FNYHC)
  • The Urban Homesteading Assistance Board (UHAB)

FEDERAL INITIATIVES NEED OUR SUPPORT
Recent events have made us aware of problems where change must be made to bring improvement. Three examples follow that are vitally important to CNYC members. Through the National Association of Housing Cooperatives (NAHC), CNYC is working on these important goals. To enhance our effectiveness, we work with several Washington based partners including the Community Associations Institute (CAI) and the National Cooperative Business Association (NCBA CLUSA). Their broad constituencies are helpful in gathering support for our goals and in dispelling the concept that any of these is purely a New York issue.

CO-OP/CONDO ELIGIBILITY FOR FEMA RECOVERY GRANTS
Prior to tropical storm Sandy, very few housing cooperatives or condominiums have been victims of natural disasters where FEMA rushes in to provide relief. Last fall, it was learned that cooperatives and condominiums could not get FEMA grants to restore or replace building systems that had been devastated by Sandy. This because FEMA, with its limited experience with this form of home ownership, interpreted the Stafford Act–its enabling legislation – to categorizes cooperatives and condominiums as businesses.

Many CNYC members were affected by the storm. Basements and ground floors were flooded, destroying boilers, lifting fuel tanks and water heaters from their moorings, Roofs, skylights and windows ere damaged or destroyed, downed trees further damaged buildings or blocked paths and roadways. Salt water corroded electrical wiring and subsequently destroyed more building systems.

FEMA came quickly and worked hard to help disaster victims. Grants were readily available to individuals to fix the insides of their units, but these were of little use when the building itself was uninhabitable due to the destruction of heating plant, electrical system, roof, etc. But no funds were forthcoming from FEMA to make the buildings themselves operable again.

Senator Chuck Schumer and Representative Steve Israel sprang into action.. Mr. Schumer arranged for HUD to dedicate millions of dollars of block grants to help fund recovery. Mr. Israel rallied 25 colleagues in Congress who wrote to FEMA and to the head of Homeland Security, asking for a change in policy. It was soon determined that legislation would be needed to modify the Robert T. Stafford Disaster Relief and Emergency Assistance Act to recognize cooperatives and condominiums as homes eligible for FEMA recovery grants.

On July 29th, Representative Israel introduced H.R. 2887 to correct this inequity. Many New York legislators are cosponsors of this important legislation. If your representative is not among them, please ask that they support this legislation. Senator Schumer introduced companion legislation (S.1480) in the Senate on August 1, 2013.

It is important that Congress not consider this a New York/New Jersey law. There are cooperatives and condominiums all across the nation that should support this legislation. If you have friends in other states who live in cooperatives or condominiums, please call their attention to H.R. 2887/S. 1480. Have them ask their lawmakers to support this legislation.

TERRORISM INSURANCE
In the aftermath of the terrorist attacks on September 11, 2001, insurance costs rose steeply and it became virtually impossible to insure some buildings against acts of terrorism, particularly in likely target cities such as New York and Washington. In response, Congress passed the Terrorism Risk Insurance Act (TRIA) in 2002. It requires private insurance companies to provide terrorism insurance at reasonable rates, but protects them from massive losses by creating this 'backstop' program which would fund a significant portion of payment due in the event of massive acts of terrorism. Fortunately, the program has never had to be implemented, but its existence has enabled buildings to be insured against acts of terrorism. TRIA was reauthorized in 2005 and again in 2007, but it is now due to sunset at the end of 2014. If this were to occur, terrorism insurance would likely again become unavailable or unaffordable.

On May 23, 2013 Representative Michael Capuano of Massachusetts introduced H.R. 2146, the Terrorism Risk Insurance Reauthorization Act. It has 30 prime cosponsors from 15 states all across the nation. It will extend TRIA through December 31, 2024 and requires reports in 2017, 2020, and 2023 on the findings of the President's Working Group on Financial Markets pursuant to an ongoing analysis regarding the long-term availability and affordability of (market conditions for) terrorism risk insurance.

The sooner the extension can become law the better, so that insurance premiums don't skyrocket in anticipation of the loss of this back-up program. Representative Carolyn Maloney is a prime co-sponsor of this legislation. She testified before the City Council Committee on State and Federal Legislation in support of a resolution urging the Congress to pass and the President to sign H.R. 2146. Representative Maloney encourages similar Resolutions from other cities and states to spur extension of TRIA.

REVERSE MORTGAGES
CNYC regularly receives calls from seniors on fixed income who are struggling to pay the maintenance on their cooperative units. If they lived in private homes or in condominiums, they would be eligible for reverse mortgages, whereby a lender provides funds based on a percentage of the value of the home, applies interest to what is owed, but doesn't seek to collect any payment until the borrower leaves their home. Reverse mortgages enable seniors to live on in their homes as long as they are able.

Through the efforts of the National Association of Housing Cooperatives (NAHC), Congress passed legislation in 1999 authorizing reverse mortgages for cooperatives. HUD was to produce regulations governing these transaction. The HUD regulations would make the loans saleable to the secondary market. We still await them.

There was a time when some lenders were making reverse mortgage loans on cooperative shares, but none have been available for the last three years.

As the NAHC continues its efforts to persuade HUD to put forth the necessary regulations, it is felt that specific personal stories may help make the case. If you or someone you know could benefit from a reverse mortgage on their cooperative, please send CNYC a brief description of the situation, with specifics including name and address. This information will be held confidential and will be shared only with those government officials whose help is needed.

 
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