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City Reinstates Improperly Withheld Co-op Property Tax Abatement

Bill Morris in Bricks & Bucks on September 14, 2022

New York City

Co-op and condo property tax abatement, Department of Finance, property managers.
Sept. 14, 2022

Barbara Sproul has done the impossible. She has fought City Hall — and won.

Sproul has been a shareholder in the prewar co-op at 142 E. 71st St. since 1979, and she once served as president of the co-op board. Since her husband, Herb Gardner, died in 2003, she has been the sole occupant of the apartment, which is her primary residence. For years she received the co-op property tax abatement without a hitch. Then, in 2020, the Department of Finance (DOF) informed her that she was no longer eligible.

The problem? “The tax abatement was denied,” Sproul says, “because our property manager, according to a man I spoke with at the Department of Finance, submitted an incorrect report, not noting that I had been owner-resident in the apartment since 1979.”

The co-op board changed managing companies, but Sproul’s problem didn’t go away. When the new management company took over, it continued to put the charge on Sproul’s bill every month — a total of about $4,000 a year. (The abatement ranges from 17.5% up to 28.1%, depending on the building’s average per-unit assessed value.) 

Sproul did not give up. This past summer she got through to someone else at DOF. “The guy said that management companies mis-filed continually,” Sproul says, “and they (DOF) were really tired of making the corrections for them. So they wouldn’t change their rejection of the tax abatement application. Of course, I have no standing with the DOF to challenge this. Our original management company is of no help; neither is our new company.”

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Then, after a query from Habitat, DOF changed its tune. On Sept. 12, Jacqueline Gold, DOF’s assistant commissioner for external affairs, wrote to Sproul: “The Department has concluded its review. It appears that as part of a special review of eligibility status of unit-owners in 2020, the benefit for your unit was inadvertently removed (one DOF file only had the name of your deceased husband). DOF has verified that we did have information for ‘Barbara Sproul’ and we are restoring your benefit for 2020 and 2021.”

Asked why the abatement was denied, Gold offered a terse reply: “Managing agents provide DOF with primary-resident status.”

To Sproul, she added that a remedy is in place: “(Your managing agent) will receive a revised and updated report for tax year 2020/21 in December. The report will indicate a credit for tax year 2020/21. Your manager will allocate the credit accordingly.”

While plainly relieved, Sproul is left with some questions. “I presume I am not the only person in this sort of situation,” she says. “But what do people do when their management company makes a mistake like this? Does one really need to hire an attorney and sue? That would cost even more, and it involves money, time and mental energy I just don’t have for this sort of thing.”

Indeed, she is not the only person in this sort of situation. City Council member Christopher Marte, whose district covers the southern tip of Manhattan, has been receiving complaints that echo Sproul’s. 

“Several of our constituents say they were removed from the co-op and condo tax abatement program because they were missing a prevailing-wage affidavit,” says Marte’s director of land use, Conor Allerton. He’s referring to a new rule that co-ops and condos must pay their building staffers prevailing wages in order to continue to receive the tax abatement — and they must file an affidavit to that effect with the DOF. “But they did submit the affidavit on time,” Allerton adds, “so it seems like an error by the DOF. The department is investigating now.”

Allerton urges any New Yorker who experiences problems with the co-op and condo property tax abatement to contact Marte’s office at 212-587-3159.

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