New York co-op shareholders demand state oversight amid governance and maintenance issues

Why do I have to go to court and spend my own dollars?”

Antonia Baker, Yonkers co-op resident

Co-operative shareholders from across the city, and beyond, are gathering to call for change in their buildings. 

Antonia Baker has been a Yonkers co-op resident for the last 15 years and she says the board of her co-operative was put in place 25 years ago and hasn’t changed since, which is only part of the difficulty she’s faced during her time in the building. 

She said her building’s facade is significantly battered and, with other problems like persistent leaks in the garage and a sinking roof, she wants answers, specifically from her board.

But, she said, when she asks to know what’s going on with the building — or if she can see the co-op’s financials — and what kinds of bids the cooperative entered into, she is consistently told no.

According to state Attorney General Letitia James’s website, the role of the co-op board is to execute good judgment in decision making on behalf of the building and follow the co-op’s own rules as established in the bylaws, lease, certificate of incorporation and house rules.

The site also reads, among the rules of how co-ops must function, shareholders must be able to “examine or review minutes of shareholder meetings, record of shareholders and annual balance sheet, and profit and loss statement.”

In addition, co-ops must allow shareholders to see an annual report disclosing the housing development’s contracts and transactions the board has completed and, if no contractors or transactions were made within the year, the board is required to send out information detailing as much to cooperators. 

Despite these laws, Baker said she has continued to hit dead ends and flat-out “no”s from her board. She’s filed two complaints with the attorney general’s office but said she was directed once more to take the board to court to fight their refusal to hand over documents. 

“Why do I have to go to court and spend my own dollars?” Baker said. 

Baker said she ultimately wants to appeal to her local government in an effort to put together a council that could oversee co-operatives within the state, ensuring boards are sticking to their own bylaws. She fears shareholders are at a severe disadvantage in fighting back against their boards when they are being told to do things like seek legal counsel they have to pay for out of their own pocket. 

She said she wants the state mandated council to govern co-op boards to investigate shareholder allegations of fraud, self-dealing, board misconduct, mortgage fraud, election fraud, kickbacks, and more. Baker said she wants this oversight so someone can keep the board in line, but, more importantly, because the board’s refusal to hand over information makes her nervous about her own equity in housing. 

“I’m concerned that we are nearing bankruptcy or foreclosure and, once that happens, I lose my equity,” Baker said, adding, with the city’s housing shortage, the greatest pathway to home ownership is owning a co-op.

Baker said she knows she has a big task ahead of her but she isn’t alone. In a quest to find more people looking for change in their co-operatives, she met Jason Bass, a co-op shareholder living in the Long Island village of Freeport in Nassau County. 

Bass says his co-op is also faced with a large amount of structural damage and he is concerned his co-op board is not taking it seriously. He said he and a number of his neighbors are experiencing serious damage within their own units and to the building generally. 

Bass said he is currently in the middle of a legal battle with his co-op that also names several other shareholders experiencing similar structural damage they feel has been left unattended. 

Bass will join Baker’s effort to ask a structural engineer’s report be completed for co-ops every five years that will then be submitted to the municipality in which it’s situated. The engineer’s report will provide a glimpse into the inner workings of the building in order to assess what projects may be in the co-op’s future. 

Bass wants this report to be followed by a reserve study that would require someone to estimate the amount of money the co-op will need to keep in their reserves in order to cover impending repairs. 

According to Bass, he does receive yearly financial statements from his co-op. as well as records he pores over, but there is no indication of future repairs and what that cost looks like, despite the co-op’s accountants previously recommending this action. 

“We are left in the dark,” Bass said. “A lot of board members take advantage by saying there aren’t any repairs that need to be happening.” 

While Baker and Bass are located different parts of the state, they are trying to gather as many co-op shareholders as they can so they can appeal to the government for legislative changes in the oversight and management of their boards.

At the beginning of this month, co-operators at the Amalgamated Housing Co-operative were creating their own petition to the board regarding the carrying-charge increase they’ve shouldered for now two months. 

The petition, drafted by members of the Amalgamated Co-operators Union, asks for the $35 fee to be suspended for late carrying charge payments, as well as for legal action on evictions or defaults for those who have historically paid their carrying charges on time. 

One Amalgamated co-operator, Jason Dent, said it’s not just the rising costs in carrying charges becoming nearly unaffordable, it’s also things like the structural damage to his bathroom ceiling that took repairs on five separate occasions to fix. 

Baker said she would love to connect with shareholders at Amalgamated looking to appeal to the state with her; the more voices, the better she says.