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We need a good plumber - BP Mar 30, 2007


We've used Fred Smith, Capital Care and ABR Plumbing for years. The quality of work's gone downhill. They now have a bad attitude, are often rude, and say, "If you don't want to use us again, don't." They won't guarantee their repairs or fix a problem we thought was fixed unless we pay them to do it again or they do more work that will cost us more.

All 3 companies are disappointing us repeatedly. We never had problems with them and we're not a demanding group. There are many plumbers in NYC, and we don't need this. Can anyone recommend a plumber who does good work, won't argue with us at every turn, or try to convince us we need a lot of costly work done that we know we don't need? Thanks.


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also, you should ask the superintendent's club...


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BP we all need good plumbers but are your expectations a little too high. I have worked with many plumbing companies over the years some good some bad. If your are looking for a plumbing company to agree with you all the time, then they are not honest and doing their job. Do you have enough knowledge of plumbing and how it works to second guess these companies?

FN.


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> Join the conversation Comments (1)


FN - I know what you're saying, but our expectations are not too high and we don't try to second guess plumbers on everything. Examples of why we're dissatisfied

- Didn't keep an appointment or call 3 times in a row, said later they "forgot" or "had more important work to do".

- Billed us twice for the same work (4 times!).

- Replaced an old broken pipe with...an old broken pipe!

- Ignore "details" like putting in a washer or filling a hole. Still have leaks and they want to charge us to come back and do what they should have done the first time.

- Broke mirror on an owner's medicine cabinet with a wrench (super saw him do it), won't pay for it, claims he didn't do it and it's his word against the super's (super is very honest, been with us 14 years).

- Says pipes (put in 6 months ago by another plumber) are causing leaks because they're "poor quality copper" (?), wants $1,000 to replace them.

One or another of the 3 plumbing companies we use did the above (the same one didn't do all of them), and these are just a few examples of incidents in the past year. Any recommendations for a plumber are welcome.


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BP - I use Tana Plumbing and they are great. They are straight forward and reliable. Call them at 914-393-8620, Harry is the owner, tell him Virginia sent you from the Bronx, 1910.

Gin


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Now I understand your frustration a little better. You have been so unlucky I guess. I use one of the companies you have issues with Fred Smith and have found them OK. Here are a few suggestions which may help.

1. Try to find similar buildings to yours (when built, plumbing layout etc), and who does their plumbing.

2. Monitor your plumbers a little closer when they visit.

3. Can your Management Company recommend a plumbing outfit? (they obviously have many buildings).

4. Does you super network with other supers (on your block,)
They may have a good plumbing company.

5. If/when you do get a good mechanic, try to schedule the work so he is available. If I find that an individual is very good at handling my service repairs, I am more than happy when possible to ask for the specific mechanic to carry out my repair.

Hope this is some help.

FN


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Thanks, Gin, for the referral to Tana. :-)

Thanks also for the suggestions, FN. We used other plumbers our mgmt co. uses - they were even worse. We can't monitor work more closely than we do. The super's always present and sometimes even a Board member. Supers in other bldgs on our block like their plumbers even less than we like ours. A couple repair men did a good job and we try to get them if we can, but their companies say they won't work that way - they send whoever's available.

We'll just keep looking, but thanks for the help.


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Try these plumbers

A C Klem 718-433-4300
Pro-Tech Plumbing & Heating 718-767-9067
Ideal Plumbing & Heating 718-392-0480
A Steinman Plumbing 212-737-5857

Mike


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Thanks, Mike, for the plumber referrals. Appreciate your taking the time to send them.


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As avid Habitat readers our board has always felt it supportive of the magazine to call one of the advertisers when lookiing for services.

We have had positive experiences with this approach. Of course caveat emptor as always. Our latest success story is DeWaters Plumbing and Heating.

They are prompt reliable and reasonable for big and not so big jobs.

Call (212) 942-1011 ask for Michael Hill.

http://www.dewatersplumbing.com/repair-service.php


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Thanks for the info on DeWaters Plumbing ~


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Good luck with your plumbing!


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Steinman Plumbing
Ask for Dave
212-996-6777
Top notch guys
solved numerous problems for us...
Best Regards,

RH


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Thanks, RH, for the referral to Steinman.


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yes except it is one of the plumbing companies that paid off building managers in 1994 so the background is not great (this may have changed but still - someone was corrupt...) :

NYT: "...District Attorney, Robert M. Morgenthau, yesterday translated a code used in the indictments to shield the companies cited as having made payoffs.

They were identified as Central Pump Plumbing of Brooklyn; Chelsea Hardware of Manhattan; Fred Smith Plumbing of Manhattan; M. Kraus Plumbing of Manhattan; Richardson & Lucas, a waterproofing and renovation company, of Manhattan; Steinman Plumbing of Manhattan, and Utility Painting of Manhattan."


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Try Kapnag, (212) 929-7111. We've had good lunk with them.


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Condo - Rose Mar 29, 2007


My building is a coop, sponsor 35 Shareholders 80
Is it possible to convert to condominiums. if possible how do we go about changing?


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Just search this space for "Conversion" However, one of the best advice came a while back from AR. I'm reproducing it below:

AR
Re: rewriting by-laws
Fri Apr 22, 2005 8:57AM209.166.28.93

I just finished one in a building I have. This Atty was very good as well. It was the first time I used him. Perhaps listen to several Atty's and see who you like best.

Stuart Nahas, Esq.
Zraick, Nahas & Rich
303 Fifth Avenue, Suite 1201, New York, New York 10016
212-686-0855/212-779-9548 / stunahas@znr.net

Also try the lawyer who originated the plan f\during conversion, he may be best.
AR



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drip pan - correction: Barbara - big al Mar 28, 2007


A lead pan is for a shower and NOT for a washer dryer installed in an older apartment. Drip pans to put under washers cost about $30-34 - see this link:

http://www.hometownstores.com/detail.aspx?ID=55086&ovchn=GGL&ovcpn=Ace%20Hardware&ovcrn=Washing%20Machine%20Drip%20Pan&ovtac=CMP

Home Depot probably has them even cheaper.




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Laundry in apartments? plumbing consultants?...please help! - barbara cano Mar 27, 2007


Hi,
I'm wondering if anyone out there can help me out: I'm a board member of a small 24 unit co op with no laundry facility of any kind and, after much review of the common areas, no hope for communal laundry facilities because of logistal brick walls (no pun intended).

Shareholders are lobbying to have washer/dryers in their apartments, which we quite support, but the building is quite old and we're concerned about structural/pipe issues. Has anyone run into this?? An article in Habitat mentions a "plumbing consultant" but there is no sign on one anywhere on the site- can anyone recommend or suggest such an animal?

Thanks VERY much


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make sure:
1) there is a rule that all residents must get the MOST energy efficient washers available (ie minimum water usage which is now much lower thn it used to be check Consumer Reports and present a list of suggested models).

2) make a rule (signed agreement) that they have the proper backflow devices installed plumbing-wise AND

3) charge a fee of $15 a month (subject to future change) for any apartments that install a washer and you should be fine.


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Thanks very much for this- we're in the dark, so your advice helps (while on the board, I'm also lobbying for washers in our apartments because our current state is no way to go through life)

Question? What exactly constitutes a "backflow device"? Also- that $15/month is essentially to cover the extra water used? Is this working for your coop?

Thanks!


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My take on washers in apartments is: where are you going to allow them to be connected? You mentioned old lines. Make sure you only RESTRICT the use of detergents to LIQUIDS ONLY. Powder detergents tend to clog lines.


My horror story is that we had an upper floor apartment with a clandestine washer. The waste stack had the worst clogging record with numerous incidents of major floods. Once this washer was removed due to a major flood at 6:00 am, we have reduced the clogging issues to minor issues on the line. Finally, if you have washers, you will also have dryers. So, I guess you will allow dryers as well with venting issues to address. Good luck!

Backflow devices or checkvalves are used to prevent water from flowing back into discharge drains of the apartment lines in the event that the stack gets full due to capacity issues or water handling issues.

AdC



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Barbara - A "backflow preventer" is a device that, in the event of flooding, etc., prevents the outflow of water that is now rendered unsanitary (or could cause blockages due to particles or debris) from re-entering your main water system and contaminating it.


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...this is all incredibly helpful. I can't tell if all of these great recommendations will translate into many dollars spent just for the luxury of clean clothes, but at this point it's worth it!



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Anyone heard of "Laundry Pure"? It's a laundry device made by EcoQuest, mfgrs of air purifiers for 15+ years. Many of our residents got the purifiers. They eliminate smoke that filters in from nearby apts. We have many smokers. There's one with a "sanitizer" feature. You can put it in a closet or on a sofa/bed to get smoke out of clothes/fabrics. About 9"x10", cost $400-$500, but work great! I digressed...

Our washers don't have "Laundry Pure" but I saw it used in two buildings. It's a device that attaches to a washer and the cold water line. It eliminates need for any detergent or bleach, makes clothes whiter/brighter, leaves no residue on clothes, takes less time to wash, reduces energy costs since no hot water is needed.

It's sold only by sales reps, cost about $700 per machine, can be installed by any plumber. I don't have full info. For more facts, go to www.ecoquest.com and click the link for "Laundry Pure." Just thought I'd pass this along.


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Check with a large commercial plumbing company, e.g., Citron Brothers. Usually, there is one or two master plumbers that will do this.

AdC


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While I am in no way an expert on the subject, I am of the opinion that you need a qualified person to do a survey. Do you know the number of shareholders that would consider installing washer dryers? if so will one company do all the work at a bulk rate etc. While washer dryers sound like a great idea remember you are limited to the wash load (they are not like the commercial type) and the dryers also heat up the apt in summer time which is not great. Also the added electric cost and water rates. In addition other things to consider. Best of luck with the project.
* plumbing codes regarding installation.
* Lead pan
* Water shut off devises.
* Venting exhaust (self venting)
* Back flow prevention.

Fat Nickie


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> Join the conversation Comments (1)


Hi- Thanks! This is very helpful. I guess I should have pointed out that we're (the board) not responsible for installing the washer dryers, paying for the increases in individual electricity bills, nor is it really our concern how warm it gets in the individual apartments (shareholders have the option to keep things status quo and take their laundry 3 blocks to the nearest laundromat, and probably will) but we're working on making sure that this can be permissable and, if shareholders make the choice, the building can handle it- structurally.

It's also important to point out that not all shareholders *can* have w/d in their apartments, presumably- as some are quite small.

What is a lead pan?

Thanks!


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A lead pan is basin/pan that catches the water in the event of a leak so it does not leak into the unit below/restricts the amount of damage if there is a leak.

FN


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Barbara, you could try having a plumber give you a consultation and maybe negotiate a deal for all residents.

Fred Smith plumbing: 212 744 1300
$99 per hour for one master plumber (insured & licensed) plus, I think, $50 to show up at your door. Again, if you could try negotiating a bulk deal.

In addition you might consider these rules surrounding washer/dryers:

1) Resident must have insurance (liability), renters/coop/condo) that covers any possible damages from the washer and they must maintain the insurance.

2) Must have a ventless dryer.

3) Must submit appliance model no. of the washer to the coop Board for apporval prior to installation or future replacement of any washers.

4) Fee of $12-15 a month (subject to increase).

5) Must have "drip pan" installed under the washer.

6) Must have proper backflow device installed.

This is from Consumer Reports:

Front-loaders. Front-loaders get clothes clean by tumbling them in the water. Clothes are lifted to the top of the tub, then dropped into the water below. They fill only partially with water and then spin at high speed to extract it, which makes them more efficient with water and energy than regular top-loaders. Most handle between 12 and 20 pounds of laundry. Like HE top-loaders, front-loaders wash best with low-sudsing detergent. Many front-loaders can be stacked with a dryer to save floor space. Price range: $600 to $1,600.

Space-saving options. Compact models are typically 24 inches wide or less (compared with about 27 inches for full-sized washers of all types) and they can wash 8 to 12 pounds of laundry. A compact front-loading washer can be stacked with a compact dryer. Some compact washers can be stored in a closet and rolled out to be hooked up to the kitchen sink. Price range: $450 to $1,700.

Washer-dryer laundry centers combine a washer and dryer in one unit, with the dryer located above the washer. These can be full-sized (27 inches wide) or compact (24 inches wide). The full-sized models hold about 12 to 14 pounds, the compacts a few pounds less. Performance is generally comparable to that of full-sized machines. Price range: $700 to $1,900.





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Barbara, I tend to agree with Big AL. Fred Smith are good at specking out the work and following up. I have used them in the past for such work.Contact Dave London or Phil Krauss. Of course they will not know who FN is.

FN


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Locating Dogs - Tom VB Mar 27, 2007


Hello, I am President of a co-op on LI and I am looking for some help. We have a strict no dog policy. We are currently in litigation to remove a dog that is a major nuisance, however there are more dogs on the property.

We have asked our shareholders to help us by identifying anyone who is harboring a dog. The problem with this is that many are reluctant to "snitch" on their neighbors.

Does anyone have a method for locating apartments that are harboring dogs without relying entirely on shareholders or the maintenance staff? I bought a dog whistle the other day, but they need to be tuned to the dog and they don't always result in a bark. Any help would be greatly appreciated.


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Some dogs bark when they hear a noise in the hallway. Mine barks when the intercom buzzes or when there's a knock on the door. Maybe board members can walk the hallways during the day when people are usually at work to listen for dog noises? Good luck!


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I have done this. It works! Soon as you walk by the front door, the dog(s) reveals themselves by barking.


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Forgive me for asking what appears to be a stupid question. If (like you said you have a strick no dog policy) did you not ask the prospective shareholder when they were interviewed? Secondly, did anyone not notice, and if they did, why was in not mentioned that people had dogs in the building until now. What were the other tenants, and staff doing not to notice?

Fat Nickie


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We always ask if they have a dog, and each shareholder must sign a paper stating they do not have a dog. However, people break the rules.

The neighbors are reluctant to report the violations for a variety reasons. I also can't ask the maintenance crew to spend their time searching for dogs, its not their job. Granted they will try their best, but the challenge is in locating which apartment the dog resides.

We have 27 buildings and 287 units spread over 3 addresses. Pinning down the specific apartment is a bit of a challenge, and we can't send a violation until we have this info.


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In our co-op, at every admissions committee meeting with the prospective buyer, we reinforce the "no four legged animal" rule.

In addition, before we interview we have the prospective owner sign a special letter that indicates that the “co-op” has a ban on four legged animals.



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I see why people wouldn't want to snitch on neighbors about having a dog but maintenance staff should help locate them. You don't have to identify who tells you about dogs. That would make staff feel more secure that they won't "get in trouble" with owners if they report them.

We have a security videocam for our lobby. People with dogs have to go through the lobby to take them out to walk them. The videotape will show who has a dog. If you have more than one way that residents can go in/out of your building, additional videocams to cover the other areas are not that costly once a main system is installed.


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I agree with you on security cameras to identify dogs and owners. However I am not in favor in using the building staff as snitches. It just puts the staff in harms way and in the line of fire. If staff snitch somehow it works its way back to the shareholder. First hand experince on this one.

FN


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FN, I respect your opinion on not using maintenance staff to report dogs. Our staff knows they can trust our Board not to reveal who reports what - because WE don't know. We only asked our staff to report on dogs and one other issue in the past. Both times, our Board agreed the only person staff should report to was the prop manager - by putting an unsigned note in the locked "Staff" box in his office which residents can't access. So even he doesn't know what staff person reports what. The only thing we care about are the findings and that they're accurate, not who reports them. Our staff feels very secure with this system. It may not work for some buildings. Things do have a way of getting around. But it's worked well for us.


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I must applaud your confidentiality on this issue. Unfortunately our board promised to keep "the informants" anonymous but when certain shareholders who were violating the house rules challenged, the board members they revealed their sources. Sad but true. Needless to say, the staff are not willing to cooperate on such issues anymore for fear of being outed. Good to see it works for you.

FN


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why woud you have a dog free building anyway? ridiculous.


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Don't misunderstand. I love dogs. I love all animals. But why might some bldgs not want dogs? Because they:

-- have been known to bite or jump on people in elevators
-- frighten some people, especially big or unfriendly ones
-- tussle with other dogs in the elevator, lobby, etc.
-- have "accidents" that mess up bldg rugs and floors
-- can also damage lobby or other bldg furnishings
-- bark a lot and drive neighbors crazy
-- howl when they're home alone - sometimes for hours
-- are sometimes allowed to run free in bldg hallways
-- stomp on, chew or do their business in the landscaping

Dogs that do these things make some residents uncomfortable and damage property. I was in a bldg lobby recently and saw a woman sitting in an armchair with a dog on a leash. The dog was chewing on the wooden leg of the chair and she did nothing about it. And yes, she saw what he was doing. Bldgs have the right to say "no dogs". If someone doesn't like it, live somewhere else.

Anonymous - Did you ever have people above you with no rugs or carpeting and had to listen to a dog run and skittle his nails across the floor every day and night? Or get in an elevator and step in a puddle of dog urine? Or had to weave your way around two dogs barking and jumping at each other in the lobby as their owners held them back? If you had, maybe you'd think differently. And remember, I like dogs. wouldn't


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I like dogs as well but it's their owners I have issues with, I argued with one dog owner because she allowed her dog to urinate on the trees outside the co-op and thought nothing of it. During the summer months that rancid smell rises from the trees and makes the entire block smell bad. We own the sidewalk as well, I told her. She keeps telling me that the rain will come and wash the smell away. I asked her does a rain cloud follow her around? I asked her how would she like to be a tree and have dogs come along and pee on her? She would have to stand in the urine and could not go anywhere. She saw my point. She doesn't allow her dog to pee on the trees anymore. Allow dog owners to have more respect for trees and property. I understand now why landlords don't like dog owners or dogs. Dog urine kills trees and dogs damage property. Not to mention dog owners who won't clean up after their pets after the dog makes a mess in the lobby and/or in the elevators.


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Re: dog urine killing trees, we planted flowers around the trees on our block, but people (not from our bldg, we don't allow dogs) walk by and let their dogs urinate on them. We put short wire stake-in fences around the trees but people let their dogs hop over them. Bricks didn't work either. BTW, kids run across tree beds and cars back into them, and they ruin trees/flowers too. One thing that keeps dogs and others out is a solid iron tree pit guard. Most are black but can be painted any color. NYC recommends getting ones that are 18" high. You don't need NYC permission to install them. They're costly but protect greenery, are attractive and last for years. Go to www.treesny.com. The site has good info on tree pit guards + a list of companies that make them or look in the yellow pages under "iron works".


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Thanks!

I will look into this! We have the same problem with other people's dogs as well.

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Sorry, accidentally had the word "wouldn't" at the end of my message about no dogs. I hate when that happens. :-)


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I lived in a dog free building and liked it. No loud barking, no messes in the hallways. The super didn't get fined for not cleaning up behind other dogs. No dog fights in the lobby. Less hassle overall and noise, what's not to like?


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Can you get energy star windows and - Number Six Mar 26, 2007


get a tax credit? AFAIK the only aluminum windows that qualify for Energy Star do not open and are meant for large commercial buildings

If people use window air conditioners look at getting 1 window in each room that has a solid bottom to permanently mount the AC unit. Leaving them in during winter can be a big source of heat loss


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roofdeck: capital improvement? - alice Mar 25, 2007


is a roof deck (as part of a brand new roof replacement) or community room a capital improvement?


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Do you mean a roof deck for residents to enjoy and that is part of a roof replacement may be considered capital improvement?

The answer is yes. A capital improvement is any major outlay of money (usually above $5,000) that improves the conditions of the property. A capital investment may be on new projects or replacement projects such as replacing an old mechanical elevator with an integrated circuit elevator or buying new cabs. Even, the cost of replacing floors or carpets are considered capital investment, unless this is done on a yearly basis, and is then considered a recurrent event.

AdC




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someone please help me??? - Brian Weiner Mar 24, 2007


Can anyone who knows alot about the flip tax please help me??
My grandmother passed away in October of 2006. She set up a trust for my mother to recieve the co-op when she passed away. After her death it was told to us by the co-op that all of the assests of my grandmother were placed in the trust but the co-op could not be passed on to my mother without a flip tax being imposed. The managing agent said the co-op had to be treated as a sale to be passed over to my mother from the estate of my grandmother over to my mother. This required my mother to pay a large sum(flip tax) with the sale of this apartment. Was this just???
My mother and I became owners of the apartment in January of 2007 and now are recieving word from the board that the flip tax is being waived as of March for those residents who set up a trust. I think this is totally unfair and would greatly appreciate it if anyone can email me with any pertinent informantion as to whether I can obtain any of my flip tax, legal fees or any monies back. I feel I was taken advantage of greatly? Would anyone advise me to hire a lawyer and if so can anyone recommend one in the NYC area?
PLease help me I am very desperate....


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get a lwyer on it and ask for buildoing records to see if any similar incidents ahve happendd in the past. this does not sound right since it is techincally not a sale (ie it was never put on the market) - probably just a reassignment of shares to a family member.


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This is an outrage!!!!!

There is a flip tax if a shareholder sells, yes! But there should not be a flip tax for a stock certificate transfer to someone in the same family especially if it were willed to you as part as your grandmothers estate.

Hire an attorney at once!!! Any real estate attorney familiar in condo/coop. law will suffice.

Good luck and you should get your money returned. If not because if was right; then because they insitituted a "new rule" immediately after taking your money.

I would fight big time!!!!!!!

Let me know how you do!

Signed
Furious!!!!!!!!


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Something is not right.

Call Dennis Greenstein, esq. 212-218-5520, former asst AG in NY.


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Before you go on a major battle, you may want to approach the board with great diplomacy. I believe that when people communicate sicerely will get more than yelling or threatening to sue.

If the board reconsidered flip taxes for estates, two or three months after yours changed, it may mean that the board thought about the reasonableness of such a fee and decided to repeal at a later time the rule.

Again, a rule may be repealed by the board or changed without having to reconsider a rejection made two months ago under a rule and now considered acceptable. If you read the proprietary lease, you will find that a board may enact or change rules to preserve the interest of the co-op. This is similar to Uncle Sam; if a certain tax advantage was eliminated in a tax year, if you are late just for one day to take advantage of the old tax rule, well... YOU MISSED IT!

Since co-op boards are sometimes more benign than other institution, you may always act with diplomacy and obtain more because you and your mother are now part of the shareholder family. If not! Be happy that you got your grandmother's apartment w/o much of an investment except for the flip tax which will remain with the co-op for future work in your own co-op!

AdC







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Whoa, whoa, whoa, people! Go back and look at the first reply, from AdC.

First, remember that your board is made up of people like you: non-experts who are trying to run a business so that it benefits you.

So if you immediately get into a legal battle, the board will have no other option than to get its lawyer involved. Perhaps you would rather have a conversation with them first, instead.

You could say, "I understand that you have changed / are considering changing the the flip tax rule so that it no longer applies to trust transfers. Of course, I just paid a flip tax in just such a situation. Can you tell me the reason you're going to change it now?"

Second, remember that, as AdC put it, you may have transfered your apartment a few months too soon to take advantage of the benefit. This happens all the time in life -- you're either a shade too early or a shade too late. It is not an outrage, it's the way the world works. So prepare to accept that, in this case, fortune didn't shine on you.

Third, understand that these trust inheritances are a legal maneuver to get around laws and regulations that apply to all of us. (One real estate lawyer told me that in the legal business, the trust inheritance is called Poor Man's Estate Planning.) So realize that all the trust does is transfer shares -- it does not allow you to live in the apartment or to sublet it, unless your board has specifically allowed that.

Fourth, before you get steamed about this, understand that as shareholders YOU are part owners of the business. If YOU don't want to pay in to support the business, then you are expecting your neighbors to shoulder YOUR financial obligation. That's not fair to them. If cooperative ownership is not your cup of tea, you should sell the apartment.

Finally, do talk with a lawyer if you wish, but do so to find out your rights and responsibilities under the proprietary lease (I assume you haven't read it -- almost no one does). Don't let the lawyer start sending letters until you A) understand what you may and may not do in a co-op, and B) before you have had a reasonable discussion with the board.

I hope this helps. You may e-mail me if you have other questions.


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paying for BIG capitol improvement: line item assessment - money Mar 24, 2007


Ok - financial question:

If a coop has a huge capital project, say a roff replacement for 1.5 million, isn't in the best interest fo the cooperative to pay for this via the form of an assessment (with a monthly seperate line item) so that indivudual shareholders can take a tax sale basis benefit when they sell their apartments?

in a building that refinances the mortgate to raise money for such a project, doenst it also make sense to present the above method of payment?

is it tru that if you do not have an assessment and do not list the costs as a seperate line item on mantainence bills, that a shareholder may not take a basis benefit if they have profint on their apartment?

our accountant is on vacation and we need comments soon. thanks



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does the below also hold true for a coop?

Q & A; Assessments Can Affect the Tax Basis

Published: October 1, 2006

Q -- Can regular monthly payments that are made along with common charges but are listed separately under Capital Reserve Fund be used to increase the tax basis for a condominium when calculating capital gains?

A -- Martin M. Appelbaum, a certified public accountant in Manhattan, said assessments levied by a condominium board for capital improvements, whether paid as a lump sum or in monthly increments, can indeed be used to increase the tax basis of individual units, thus reducing the profit when the apartment is sold.

This assumes that the board has complied with Internal Revenue Service guidelines. Mr. Appelbaum said that under I.R.S. regulations affirmed in numerous court decisions, the board must pass a resolution and notify unit owners that the funds being raised will be used for capital improvements only and not for operating expenses or ordinary repairs.

In addition, he said, there should be a separate line item on the monthly bill for the capital assessment. And finally, he said, money collected for the capital assessment should be held in a different account than the one used for other funds collected by the condominium.

"The condo board should consult with its C.P.A. firm to ensure they are following the proper procedure for billing and collection of the funds," Mr. Appelbaum said.



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Yes, it holds true. Assessments and general improvements to your apartment add to the original value of the price you paid for your unit and (if the co-op is not your first home that you sold) so, what you get on the sale of the unit is now subtacted to the original price + assessment.

What many times happen is that the IRS provides you a break on the first home that you sell. So, if your profits are not greater than the break you get, you deduct zip.

AdC


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If it is a question is Yes. If it is a statement, you have just reaffirmed my explanation. But remember, the IRS give the deducion once. After that, you must declare the profit. So, if you are selling another home that you have owned in a series, then the IRS deduction does not apply; capital improvements become handy to reduce your profit or increase your losses.

AdC


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Our 500 unit co-op is forty years old. We have capital improvements every year in accordance with the AICPA required engineering study and capital improvement plan. Our plan says that we need to spend about $15,000,000 over the next fifteen years, in current dollars.

It does not mean we schedule the capital improvement precisely in the year estimated by the engineering study as many year to year maintenance events can prolong the life span of a capital feature.

However, for a number of years we have had a yearly assessment that garners about $1,000 per unit (yes, apportioned by the number of shares), and thus we have an annual capital improvement income stream of $500,000.

In addition our original mortgage was retired without ever refinancing or expanding the principle. In turn, rather than lower the monthly maintenance costs by the like amount, we kept this item in the income stream but change it to capital income and now we use this income for capital improvements. In total, we now accumulate $900,000 a year for capital improvements.

The rationale is that as the building ages, more of the original infrastructure and even some of the newer more recent items need replacement. Thus, we are replacing windows over a six year program without borrowing, we are replacing our central AC (used buy all apartments) chiller devices, we upgraded our lobby, we completely overhauled our elevator systems and cabs, we built a new mailroom, put off street parking decks were completely refurbished, and soon we will replace all wallpaper and carpeting in the hallways of all floors.

The point is that assessments should be a recurring yearly income stream and now sprung on residents as ”specials”. By having assessments as regular yearly event, residents can plan budgets accordingly (in our case) for years to come.



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how do cap expenses have to be listed and budgeted to remain deductable when a person sells their apartment? our coop is assessing for "general" purpose of offsetting future expenses without earmarking the assessment for anything.



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Essentially, the co-op's auditor should assist in segregating the funds in a separate line item in accou8inting and a separate bank account. Yes, the monthly billing statement should show the assessment as a separate entity.



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Coop liability in libel - JB Mar 22, 2007


A board member has publicly accused our managing agent of wrongdoing and the MA has responded to the charge and accused the board member of libel for which there was no response. Could the coop be liable in a lawsuit, particularly if no action is taken by the coop to make a distinction between personal remarks and coop statements?


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Has the MA started a legal action? Is the MA still representing your co-op? How were the wrongdoing accusations raised? In a public forum? What is the extent of the damage?...Have you discussesd the problem with your co-op counsel?

AdC




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Just an FYI re defamation of character....Libel is written. Slander is verbal. Call your attorney today.


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It consists of several public open forum statements accusing the current Managing Agent of wrongdoing which appears to be heading toward his termination. No legal action has been filed, but there is concern that the coop could now be drawn into a libel suit.


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if you have facts and evidence of wrongdoing you will be OK.


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There's an archived article on this topic. The board member who cannot prove their claim could be sued and then drag your coop into the lawsuit. You should look into your coverage.


June 4, 2000
YOUR HOME; Liability And Boards Of Co-ops
By JAY ROMANO

ON April 11, the New York Court of Appeals, the state's highest court, addressed the issue of whether corporations, including co-op housing corporations, can be required to pay punitive damages assessed against their board members. The court's answer -- a qualified no -- has been unsettling for co-op corporations and their board members.

''I think a lot of people are nervous about this decision,'' said Richard Siegler, a Manhattan co-op lawyer. ''It's going to make people more hesitant to serve on co-op boards, and it will make those who do serve more reticent about making decisions that could be controversial.''

The case in which the court ruled, Biondi v. Beekman Hill House Apartment Corporation, was the final chapter in a legal case that began in 1995.

At that time, a shareholder in the apartment corporation, a co-op at 425 East 51st Street, sought permission to sublease her apartment to Gregory and Shannon Broome. When the board denied the request, the Broomes filed suit under the federal Fair Housing Act and other antidiscrimination laws, charging that the denial was based upon Mr. Broome's race. He is black; his wife is white.

After a jury found in favor of the Broomes, the couple was awarded a total of $640,000 in damages. Of that amount, Nicholas A. Biondi, the president of the board, was ordered to pay $230,000 in compensatory damages and $125,000 in punitive damages. After subsequent settlement conferences, the compensatory damages ended up being paid by the co-op's insurance carrier while Mr. Biondi remained personally liable for $124,000 in punitive damages.

Mr. Biondi then filed a lawsuit against Beekman Hill House seeking indemnification, a form of reimbursement, for that amount. The basis of his claim was a clause in the co-op's bylaws that required the corporation to indemnify board members for any ''judgments, fines, amounts paid in settlement and reasonable expenses'' incurred as a result of their good-faith actions on behalf of the corporation.

In 1999, after a lower court dismissed Mr. Biondi's claim, he appealed to the Court of Appeals. In April, the court affirmed the lower court's dismissal, saying that in this case, indemnification for punitive damages was prohibited by public policy.

''What the court is basically saying is that it is against public policy to reimburse an individual director for capricious, arbitrary or illegal conduct,'' Mr. Siegler said, adding that while this may seem reasonable for conduct clearly undertaken in bad faith, it becomes a bit more murky in situations in which a board member, acting in what he or she may believe to be in good faith, nevertheless crosses the line and does something for which a penalty is assessed.

And it is that uncertainty -- coupled with an increasing number of federal, state and local laws that expose board members to punitive damages, fines or other penalties -- that Mr. Siegler and other lawyers say make it harder to find volunteers to serve on co-op boards.

''I don't think people will be as willing to serve if they feel they won't be indemnified for actions taken on behalf of the corporation,'' Mr. Siegler said, adding that in addition to the potential liability board members face when dealing with federal, state and local laws against discrimination, there are also some less obvious exposures.

For example, he said, failure to comply with the city's window-guard law, the elevator-inspection law and the federal lead paint disclosure law could all subject directors to substantial fines and penalties.

Bruce A. Cholst, another Manhattan co-op lawyer, said that while current and prospective board members may understandably be concerned about the impact of the Court of Appeals decision in the Biondi case, there are subtleties contained in it that could still make it possible for co-ops to reimburse board members for punitive damages under certain circumstances.

''The Court of Appeals held that public policy prohibits boards from indemnifying directors for punitive damages imposed for acts of bad faith,'' Mr. Cholst said. ''But what is significant about this decision is the court's definition of the term 'acts of bad faith.' '' The court, Mr. Cholst said, defined ''bad faith'' as the absence of a ''reasonable belief'' by board members that their conduct served ''the best interests of the corporation.'' In other words, he said, it is still possible for a board member to be reimbursed for punitive damages if he can adequately demonstrate that he was acting in good faith for the benefit of the co-op.

Accordingly, he said, punitive-damage awards, fines or penalties arising from errors of judgment -- following another person's misguided advice, for example -- can probably be reimbursed if a board member can establish that he was acting in the best interests of the co-op.

''The first precaution that should be taken by boards concerned about this issue is to review their bylaws to make sure that all existing loopholes are adequately plugged,'' Mr. Cholst said, adding that if the bylaws do not permit reimbursement for ''judgments, fines, amounts paid in settlement and reasonable expenses,'' they can be amended to do so. In addition, he said, the bylaws can also include a provision permitting reimbursement of legal costs before a final decision in the case.

''If they don't,'' he said, ''then board members who are individually sued are required to pay their own defense costs upfront and then seek reimbursement from the co-op only after the proceeding has been concluded in their favor.''

The bylaws should also contain a provision, Mr. Cholst said, that protects board members from liability to shareholders for anything they might do in good faith on the corporation's behalf.

Finally, Mr. Cholst said, if a board is particularly uncomfortable about the potential for having to pay punitive damages, it should talk to its insurance broker about finding coverage. While New York law bars insurance companies from selling such coverage in the state, he said, it can be obtained from ''offshore companies,'' as they are known, most of them in the Caribbean.

Martin Eveleigh, a manager at P. D. Insurance, in Tortola, British Virgin Islands, said his company offered coverage for punitive damages when they are imposed concurrently with compensatory damages, as was the case with Mr. Biondi.

''We draw a distinction between punitive damages and fines,'' Mr. Eveleigh said, explaining that insurance from his company specifically excludes fines and penalties.

He said that the maximum coverage now available is $500,000 and that the individual or company seeking coverage must also have a standard liability policy. The yearly premium for punitive-damage coverage starts at about $1,500, Mr. Eveleigh said, depending on the deductible and the amount of liability coverage.

There are, of course, some drawbacks to dealing with an offshore insurer. Donald Gabay, a Manhattan lawyer, said that New York's insurance guarantee fund, which protects policyholders if an insurer goes bankrupt, would not apply here. In addition, he said, offshore companies may operate with less regulatory oversight.

Arthur I. Weinstein, a Manhattan lawyer and the vice president of the Council of New York Cooperatives and Condominiums, said that if a co-op determined that punitive-damage coverage from an offshore company was ''affordable and enforceable,'' the board should consider it.

''It is always in the best interest of the co-op to get the maximum amount of insurance it can reasonably afford for its directors,'' he said. ''How else are you going to get good people to serve?''

* Copyright 2006 The New York Times Company


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Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments

Professionals in some of the key fields of co-op and condo board governance and building management answer common questions in their areas of expertise

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