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Co-op financial issues

BUDGET:

The seven months through March 31, 2011 (58.33 percent of the budget year) budgeted versus actual report from our accountants showed actual revenues of $8,778,630 (58.06 percent of the budgeted amount) and total expenses of $7,719,275 (56.41 percent of the budgeted amount), as reported by our auditors.

REAL ESTATE TAX ISSUE:

The burning issue right now is the increase in the real estate assessed valuation. As you might have heard, the City of New York increased our assessed value for the upcoming year (which begins July 1, 2011) over 100 percent. This would have a devastating effect on all of us.

The following is a brief summary about where we are currently. The Department of Finance (DOF) finally conceded that it was using commercial property rents and not residential rents, as required, as the basis of its formula for determining assessed values. The only problem is that the DOF has not revalued the co-op’s assessed valuations.

There have been three town hall meetings between March and April (LeHavre, Clearview Gardens and a joint Deepdale Gardens and Beech Hills). All were well attended. We all have asked our respective shareholders to participate in a letter writing campaign to various elected officials, such as the Mayor, the Commissioner of the DOF, councilmembers, state senators and assemblymembers.

There was a community board meeting in March that many LeHavre residents attended. Finance Commissioner David Frankel spoke about the methods used to calculate the assessed values. Most attendees will agree that no satisfaction was obtained from his remarks.

Legislation has been introduced in Albany to move co-ops and condos from Class 2 status to Class 1 status. Class 2 is the tax class that we are presently in. This class also contains the commercial and rental properties. Class 1 is the tax class for single family homes. In Class 1, assessed values can only increase by 6 percent per year or no more than 20 percent over five years. Class 2 properties have no cap for assessed valuations. But this is a long range solution.

Time is running out. The DOF will submit final valuations by the end of May and then they will be set for real estate tax calculations for the upcoming year starting July 1. The Presidents Council (a group formed by Queens co-op presidents) will be meeting to determine what to do next. One possibility raised was to commence a lawsuit against the City of New York to try to prevent the changes from going into effect while this matter is litigated.

As additional information is generated we will inform LeHavre shareholders immediately.

OTHER ISSUES

Keep in mind, also, we have a new surge in oil prices again along with increases in water and sewer charges. Of course labor increases are automatic under the union contract. The Budget Committee had its first meeting April 21 to commence the budget preparation. I cannot report the results since I am writing this column prior to this meeting.

As stated above, the next few months are crucial and we must make the proper decisions in order keep LeHavre an affordable place to live without compromising the quality of life.

I will continue to be fiscally prudent and, to the best of my ability, keep LeHavre affordable for its residents.

With your help and input, I will keep striving to make us an even greater community.

As always, and more than ever, I thank you your continued support.

 

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