New York's Cooperative and Condominium Community

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Regulated Co-op Admissions: Prospects and Possible Consequences

Jennifer V. Hughes in Board Operations on July 16, 2013

New York City, Murray Hill, Byron Apartments

July 16, 2013

Eva Talel, a co-op attorney and partner at Stroock & Stroock & Lavan, argues that the proposed law is unnecessary since there are other civil remedies to discrimination. She believes using the threat of fines or admission if a board doesn't meet a timeline is  counterproductive. "If you put in that kind of presumption, any rational board is just going to simply reject a property transfer if they don't feel like they have enough time to consider the factors they should weigh," she says.

At the Byron Apartments, a 132-unit co-op at 165 E. 32nd Street in Murray Hill, board president Silvana Vlacich asserts that the timelines are unreasonable. "Some boards just don't meet as often," she says. Besides, it is already in a board's best interests to act quickly. "From a business standpoint, it's a good thing to act within a reasonable time frame."

If boards need more time, she asserts, there are probably good reasons for it. "We pride ourselves on being prompt and doing what is right for a prospective shareholder. I'd hate the idea that we have to accept someone automatically because the paperwork is not correct."

"It's totally unfair to impose this burden on a volunteer board," Talel says. "We think it will have a chilling effect on who would sit on a board, and boards are crucial to the successful running of a co-op." 

Political chances?

There is admittedly "less resistance" to Councilman Lewis Fidler's (D - 46th District) bill compared to City Councilman Brad Lander's (D - 39th District), which demands reasons for rejection, says co-op attorney Geoffrey Mazel, a partner in Hankin & Mazel. "But the co-op community is vigorously opposed to both bills."

Politicians have spoken softly, with variously sized sticks. In a statement at the hearing on Fidler's bill, Mayor Michael Bloomberg opposed the measure because it creates burdensome record-keeping for co-ops and the automatic acceptance clause is "draconian." Mayoral candidate Christine Quinn, the city council speaker, said through a spokesman that she is "reviewing the [Fidler] bill and testimony from the hearing." She is flatly opposed to Lander's bill, calling it "overbroad," adding: "It may have the unintended impact of making home ownership less attainable and more expensive because complying with this law will be costly."

The Real Estate Board of New York (REBNY) backs the part of Fidler's bill with the time clocks but not the portion that would require boards to swear they are not discriminating, which Frederick Peters, co-chair of the board of directors of the group's residential division, calls "unrealistic." He adds: "I would say that the chances of this bill getting passed in its current form are not so great. What I am hoping is that it's the jumping-off point for a conversation about a bill that would be passable and would bring about some urgency to the way the process of co-op admissions is managed." 

Matters will get more complicated because term limits are forcing Fidler out of office in January 2014. He says he's not sure whether another council member will pick up the cause.

As for the state bills, Stuart Saft, chairman of the Council of New York Cooperatives & Condominiums, says he doesn't think they have a chance as long as Republicans control the Senate. "The [Assembly] has passed versions of these bills for decades and they don't go anywhere because there is no support in the Senate." 

So, if the bills die, does Saft think we will see more versions of them resurfacing? "Oh, absolutely," he says. "I expect we'll see this regularly until elected officials understand how complex a job it is for a volunteer board to handle all the issues that arise. It's not as simple as some people would make it out to be."


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