Paula Chin in Board Operations on December 9, 2016
For Patricia Crawford, board president of the Garden Court cooperative at 208 West 119th Street, Harlem has always been home. She was born in Harlem Hospital and spent her early years within a six-block radius in central Harlem before finally moving in 1973 to Garden Court, which was then privately owned affordable housing.
“Back then, Harlem was a wonderful place to live, where you knew all your neighbors, they looked out for your children, and we all considered each other family,” says Crawford, who married a school custodian and raised two children.
The residents at Garden Court, a pair of five-story buildings totaling 157-units that sit between 118th and 119th Streets, enjoyed that same sense of community, even after the city seized the building in 1996 because the owner failed to pay property taxes. “It was still well maintained,” Crawford says, “and everything stayed pretty much the same.”
But after several years, cracks began to show. Repairs weren’t being done, and the building deteriorated, especially the once-beautiful courtyard. At the same time, a related trend was unfolding: the city was seizing thousands of derelict buildings and fixing them up, then allowing tenants to buy their apartments for nominal amounts and turn the buildings into low-income Housing Development Fund Corporation (HDFC) co-ops. In exchange, the fledgling cooperators were granted tax subsidies to keep maintenance low. In 2000, the tenants at Garden Court banded together, took out a $400,000 mortgage, and incorporated as an HDFC.
For Crawford and her fellow shareholders, the challenges began the moment Garden Court went co-op. In addition to the mortgage, other expenses quickly piled up, including hiring a new management company, superintendent, janitors, and other staff. The century-old structures also needed extensive capital improvements, including new roofs, windows, trash compactors, and masonry repairs. To fund those projects, in 2002, Garden Court took out three additional loans.
In 2003, Crawford became board president just as the co-op’s property taxes inexplicably began rising. The bills jumped from $108,015 that year to $634,828 in 2015 – a punishing 588 percent increase that shareholders simply could not afford.
The board started knocking on doors, but no one could help. By 2015, the desperate board hired attorney Scott Goldberg, a co-owner of Metropolitan Refunds, which specializes in real estate tax programs at the city’s Department of Finance (DOF). His analysis revealed that Garden Court’s tax nightmare boiled down to one issue: in 2003, the co-op received a J51 property tax exemption for renovating a residential apartment building, but the co-op’s tax bills never reflected the exemption.
How did the mistake happen? In this case, the DOF assessor did not properly record that it was J51-related work that led to increases in the assessed value of Garden Court. Screwball real estate tax assessments are a chronic problem in the city, and as a result of this one, the co-op had been overcharged $3.3 million.
After Goldberg sent a letter and documents to the DOF, Garden Court’s tax bills were adjusted retroactively, and the co-op received a check for $1.7 million last January. There’s another upside. “Now that the J51 is in place, their taxes will be frozen at around $100,000, which is roughly what they were before the renovations were done,” Goldberg says. “That means Garden Court will save over $630,000 every year until the exemption expires in 2038, which comes to more than $12 million.”
When Goldberg relayed the news at a packed meeting in Garden Court’s community room last November, people stood up and cheered. “Someone actually shouted, ‘Good job, Patricia!’” Crawford recalls. “I was so elated I just started weeping quietly to myself.”
On that day, a Harlem co-op was reborn.
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