Tax break for co-ops set to expire this month

Co-op owners may be in trouble if the New York State legislature does not renew the state’s tax abatement program.

Without the extension, co-ops and condominiums will lose their partial property tax relief on Sunday, July 1.

The law  — which provides a 25 percent abatement for buildings with an average assessed value per dwelling worth less than $15,000 and 17.5 percent for those worth more than $15,000 — is due to sunset on Saturday, June 30. 

The state is currently considering a bill, introduced by Speaker Sheldon Silver and co-sponsored by Assemblyman Jeffrey Dinowitz, that would extend the current tax abatement program for co-op and condominium owners through 2016.

“I am very hopeful that some kind of extension would pass … the repercussions if it doesn’t pass are very severe,” said Ted Procas, chairman of the Association of Riverdale Cooperatives & Condominiums. 

He said if co-ops lost the abatements at the end of June, co-ops would have to make up the difference by dipping into the pockets of shareholders by increasing maintenance fees or through a special assessment — a way co-ops recoup expenses from shareholders.

Many co-ops are already operating on tights budgets, having been hurt financially by having to pay for a city requirement to change from No. 6 or No. 4 heating oil to a cleaner option. Water rates have also skyrocketed, including a 7 percent increase that will take effect in July.

“Given all the increases we’ve sustained with water and all kinds of other stuff and fuel changeover, I think the budgets are tight,” Mr. Procas said.

To bring attention to it, Mr. Procas said ARC, as well as the Council of New York Cooperatives & Condominiums, have been urging members to send letters to elected officials.

Mr. Dinowitz said he received many letters from local co-op boards and shareholders.

In the case of Mr. Dinowitz, however, writers are preaching to the choir.

A co-op owner himself, Mr. Dinowitz said he thinks the abatement should not only be extended, but should be improved.

“I think we should have a straight renewal or something that improves, an improvement would be better,” he said.

Mr. Dinowitz said he was hopeful the bill would pass. Right now, improving the abatement is not even on the table.