New York's Cooperative and Condominium Community

Habitat Magazine October 2020 free digital issue

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ARCHIVE ARTICLE

How to Soften the Sting of an Assessment

The Challenge

In the past 10 to 15 years, the city has imposed an ever-increasing collection of rules and regulations. Meeting these obligations is a big challenge for co-ops and condos, which are often struggling to find money to pay for projects mandated by the city. We manage a condo that found a way to pay for needed work and make it palatable for the unit-owners.

The Solution

The problem with assessments is that they are usually large and unexpected, not allowing unit-owners to budget for the expense. To counter that, the board and the treasurer came up with a long-term assessment plan, in which the upfront amount would be drawn from the reserves, and the unit-owners would spread the repayment over a long period. Even after the reserve fund is replenished, unit-owners still pay small increments every month, which allows the board to collect money for future obligations. This way, there is no need to hit unit-owners with hefty assessments in one shot. In effect, it is a standing assessment.

The Lesson

Planning ahead is a major factor. Proper planning is a must. We can always do these small assessments spread over time and make things go more smoothly for everyone.

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