JULY PROPERTY TAX BILLS INCLUDE ABATEMENTS FOR QUALIFYING HOMEOWNERS IN CO-OPS AND CONDOS
In mid June, the Department of Finance of the City of New York sent property tax bills for fiscal 2005, which began July 1, 2004, to all property tax payers. The early passage of Chapter 97 of the Laws of 2004 made it possible for property tax abatements to be credited on this bill. Because the City Council had not yet fixed the tax rate for the new fiscal year, these bills were calculated by applying the 12.62% tax rate established last November to this year’s assessment. The Department of Finance will recalculate all tax bills once the new tax rate is established. Adjustments will appear on all January tax bills – those for individual unit owners in condominiums and those for cooperative apartment buildings. As it has done in the past, the Department of Finance will send a chart to the contact person in all participating cooperatives in autumn, telling precisely the dollar amount of exemptions and abatements due to each apartment owner. The cooperative has until June 30, 2005, to distribute the abatement.
COMPARATIVE STUDY OF 2003 OPERATING COSTS
The Council of New York Cooperatives & Condominiums published its Comparative Study of 2002 Operating Costs last year and distributed it to member cooperatives and condominiums and professional subscribers. This annual analysis provides a framework to help you decide if your own building is operating economically and efficiently. It examines the various costs of operating a building in New York today. Code numbers are used to identify the participants, while preserving their anonymity. When the Study is sent to members whose financial data is included, they are advised of their code numbers so that they can easily find their own statistic.
Participating buildings are listed in one (or more) of six categories: cooperatives from the east side of Manhattan, cooperatives from the west side of Manhattan, small cooperatives (those with fewer than 100 rooms), large cooperatives from outside of Manhattan, lofts and condominiums. The Comparative Study analyzes all data on a per-room basis, beginning with the current assessment and mortgage figures for participating buildings and the carrying charges (maintenance) paid by shareholders and unit owners. It then lists amounts spent per room on wages, fuel, utilities, repairs and maintenance, insurance, management fees, administrative costs, water & sewer fees, property tax, and debt service. When possible, elevator maintenance and legal and accounting costs are each listed separately. On the page following this raw data for the year, the Study presents a chart of summary statistics for each category of buildings analyzed, calculating the averages and medians for each item, and the average portion of total operating budget devoted to each. A recap of these averages for the prior nine years completes the chart.
The Comparative Study is most helpful to the buildings whose financial data is included, but other buildings will still find it a very useful diagnostic tool. To maximize your benefit from the Comparative Study of 2003 Operating Costs, please be certain that CNYC has the 2003 financial statement from your cooperative or condominium along with an accurate room count.
The Comparative Study of 2002 Operating Costs can be purchased from CNYC for $5. Send your check to CNYC at 250 West 57th Street, NYC 10023-2142, being sure to specify the address to which to send the Comparative Study.
WATER RATES INCREASE 5.5%
The New York City Water Board voted an increase of 5.5% in water and sewer rates for the fiscal year 2005. The Water Board is responsible for maintaining the complex system of reservoirs and pipes that bring water to New York City and provide for waste removal through the sewer systems. The cost of operating this vast system comes in large part from the water and sewer fees paid by users. The Water Board annually issues a report and holds hearings in all five boroughs prior to setting the rate for the ensuing year. These hearings provide opportunity for rate payers to plead their case for lower costs and to call to the attention of the Water Board difficulties that arise with billings, lost records and changeover from frontage rates to meters.
Water meters are now required in every building in the city of New York as the result of a program begun in the mid 1990s aimed at promoting water conservation through awareness of quantities used. Even after their meters were installed, buildings were permitted to continue to pay frontage fees (based on a formula rather than on actual water use). Many buildings found that their metered rates would be lower than the frontage and opted to change. Currently, all buildings are required either to accept the meter rates or to opt into a program that cap water fees at a specified per-unit level which increases annually paralleling the meter rate increase). To participate in the cap program, a building must first institute numerous water conservation devices (low flow toilets, flow restrictors on faucets and showers). Andrew Hoffman, property manager and president of CHIP (the Community Housing Improvement Program) will address water bills among many other issues in his July 27 seminar on Controlling Variable Costs.