Property management, particularly in the New York City metro area, is a highly specialized field that handles tremendous, valuable assets. The barrier to entry into our field is pretty low, with a number of fly-by-night companies and inexperienced managers / companies in the field. They’re able to take on clients due to their cheaper pricing, which in many cases is the sole litmus test used by property owners and boards for their management hires. This begs to raise the question; should property managers and management companies be licensed in the State of New York or should it stay as it is; with no major restrictions or hurdles to jump over?

If you look to the state of Florida, real estate management companies are required to be Licensed Community Association Management firms and individual managers are required to possess the Community Association Manager license as well. Both of these licenses are obtained by passing background checks with the Federal Government, taking specialized courses, passing course tests, passing state level tests and then attending continuing education every two years. Once these tests are passed a license is issued through the Florida Department of Business and Professional Regulation and then the licensees and the firms are held accountable for their actions and also held liable for any violations of the state-level regulations. Rules are changing constantly and it is up to the licensee to ensure that they are following the law as it is written. No such laws or oversight exist in New York State.

In New York State, and a reason why so many real estate brokers turn to management in a downturn, a property management firm must be a Licensed Real Estate broker in order to collect rent (or maintenance / common charges) on behalf of the owner. Many companies do not know this law as it is not widely known and as a result do not maintain an active broker’s license for the firm. Other than that provision, there is no obligation by the management company to follow any statutes of law that relate specifically to the management of properties and the fiduciary responsibilities of a managing agent to the owner of the property. Of course all laws have to be followed with regards to the maintenance of a property and each property should be run efficiently in a law-abiding way, but there is no oversight at this time from the state to make sure that those who are running these properties themselves are both with a clean record and properly trained for the position.

Could the various buildings owners and boards in the area benefit from a systematic overhaul of the current system that would ensure that all of the employees managing their accounts be licensed and up-to-date with all current regulations and responsibilities? I think so. It would take a lot of work on both the state end and also with each individual property management company, but in the end it could benefit those who need it the most; the property owners who rely on us, as professionals, to maintain and properly manage their valuable assets.

– Mark Levine, RAM, CAM

HPD has just released the 2015 – 2016 MDR’s on their website, allowing building owners and property managers to update before the September deadline to file. If you log onto your online portfolio (link here) you can create a new PDF to print and have signed / dated by the managing agent and the building owner (or officer of the Board).

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**Update on 5/8/15: The NYC Water Board voted to raise the water rates for FY2016 (effective 7/1/15) by 2.97%.**

The New York City Water Board has recently received a formal recommendation from the Department of Environmental Protection that the water rates should be increased for 2016. The increase that has been noted is 3.24%, which would also mark the second annual increase under Mayor de Blasio (3.35% last year).

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As we’ve covered before, Local Law 11 is one of the critical inspections and filing procedures for buildings that are large than six (6) stories within the confines of New York City. We’re now in Cycle 8 (info on that here). But if your building never filed for Cycle 7, and was required to, that would usually lead to harsh fines and penalties from the City. An Amnesty Program was just announced that should ease the burden and help the city stay safe at the same time.

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We have covered the heating requirements in multi-family buildings (link here) in the past, but what do we know about the required hot water temperature within an apartment that is located in the New York City area? That’s pretty easy, so long as you know the law.

WHO DOES THE LAW APPLY TO? Under New York State law, the law applies to all owners of buildings with three (3) or more apartments that are built after April 18, 1929, and before January 1, 1951 that are three (3) stories or more in height AND all owners of buildings with three (3) or more units that are built after January 1, 1951.

Under a more specific New York City hot water law, the law applies to all owners of buildings with three (3) or more units built before April 18, 1929, all owners of buildings with three (3) or more units built after April 18, 1929 and before January 1, 1951 that have fewer than three (3) stories AND all owners of tenant-occupied 1 or 2-family dwellings in NYC.

WHAT DOES THE LAW REQUIRE? The New York State hot water law requires that all residents in a building that falls under the jurisdiction be given hot water that is at least 120 degrees Fahrenheit in every shower, bath and sink, 24-hours per day. Building owners in New York City must provide hot water that is at least 120 Fahrenheit in every shower, bath and sink between 6am – Midnight, every day of the year.

NEW YORK CITY LAW ONLY: Owners that fall within the NYC hot water law must install an anti-scald feature on any valve that controls the water supply to bathtubs and showers when renovating the water supply in the bathroom or when installing a new bathroom. An anti-scald feature will prevent the temperature from reaching above 120 degrees Fahrenheit, to prevent burns. If an anti-scald device is used, the minimum temperature that it can have water coming out is 110 degrees Fahrenheit.

WHAT FINES CAN MY BUILDING BE SUBJECT TO FOR NOT PROVIDING HOT WATER? Should your building fail to provide adequate hot water to residents as prescribed by State law, the building owner may be fined $500 and/or imprisoned for up to 30 days, per offense. Owners who violate the City hot water law could be fined between $250 – $500 for a 1st violation and between $500 – $1,000 per day for each violation that occurs during the same year. If renovating a bathroom or installing a new bathroom, the fine for not installing a proper anti-scald device can see a $500 penalty per violation.

Hot water and heat are two of the most important services that a landlord / building owner can provide. While it’s understandable that from time-to-time there will be boiler issues and repairs are warranted, a systematic problem that sees residents out of hot water on a consistent basis is a problem that will need to be resolved.

If you are in a building with a systematic hot water or heat issue, please call 311 (after calling your building management company) to report the building and to have an inspector visit and issue a violation, if needed.

Did you know that if you reside in a building in New York City that is between 5 and 75 residential units and a customer to either ConEd gas or electric service, you are qualified to obtain a FREE ConEd Green Team Survey by a Green Team energy professional? As part of a program to incentivize buildings, and residential occupants, to save energy by using more energy efficient products, the Green Team professionals will evaluate all of your lighting and heating equipment and will offer energy-saving recommendations throughout your property.

The survey will arrive to the building owner or manager and will provide all of the information that you need in order to make a decision, based on their recommendations. There is no requirement to abide by their recommendations at any time.

In addition to the free survey report and recommendations, a Green Team professional will also install free CFL’s, water saving devices and smart strips in residential units. There is also the possibility of building owners receiving rebates for eligible upgrades to common area equipment, including lighting fixtures, LED exit signs, HVAC and building management systems.

To sign up for the survey or to obtain information on the process, you can call ConEd directly at 877-634-9443

New York City, in partnership with Electronic Recyclers International, Inc., is now providing an e-cycleNYC program to buildings in the New York City area. A state law, it is now illegal to discard of electronics in the normal trash and all buildings will need to abide by the guidelines that are set forth. If your building should sign up for the program and receive a Sanitation ticket for placing an electronic device out with the normal garbage (if a neighbor places a tv with your garbage, for instance), you will most likely have the ability to appeal the ticket and show good faith that you are in the program.

Accepted electronics for the e-cycleNYC program include televisions, dvd & dvr players, monitors, computers, peripherals (mouse, keyboard, etc.), tablets, printers, scanners, mobile phones, mp3 players and hard drives. Essentially, anything that is plugged in and has a storage function is acceptable. If an item is placed for collection with the e-cycleNYC program and it is cracked, such as a television with a broken screen, the city will request that tape be placed over the crack as to not endanger the staff when they are removing the items.

Items that are not acceptable for recycling in the program and that can be left out with the normal garbage collection are appliances such as vacuum cleaners, refrigerators, washing machines, blenders and stoves. In addition, batteries are not eligible for the e-cycleNYC program, either. There are consumer take-back programs available for rechargeable batteries at many locations that sell them (such as Staples) and normal alkaline batteries can be thrown out with the regular garbage.

Depending on how large your building is will determine what type of access you have to a storage bin, provided for free by the city. If you are in a building that is smaller than 50 units, a storage room can be kept where these items can be deposited. A bin will not be given to your building, but when there are more than 20 pieces of electronics to be picked up, your building can call the city to schedule a removal of those items. This room should not be located either more than one staircase down if there is no elevator, or should be accessible by an elevator. If your building is either too small for a storage room or if you feel as though you’ll never hit the required 20 pieces of electronics to initiate the pick-up, you can always donate your electronics at Goodwill (or another organization) or recycle select electronics at vendors that will accept them. Best Buy, for instance, has a mobile phone recycling drop off at the entrance to their stores.

If your building is larger than 50 units in size, you will be eligible to have a locked storage bin delivered that will be placed in a dedicated room or area of the building that is accessible to the residents and/or building staff only. The bins come in two different sizes; a small (2′ deep x 4′ wide x 5′ high) and a larger (2′ deep x 5.5′ deep x 6′ high). A padlock will be delivered with the storage bin and when there is a pickup, the entire storage bin will be removed and a new one left in its place (with a new padlock as well). The city will request that the room where the bin will be located be accessible either by service elevator or if steps are required to be navigated, a building-supplied ramp should be used to allow for the bins to be rolled up and down. If there is no ramp and there are only stairs leading to the room the bin will not be able to be delivered. It goes without saying that any room that is holding these bins should be large enough for the bin and additional room for turning.

The program will be available to those buildings that sign a license agreement with the city. These agreements cannot be altered in any way from their original text (building attorneys will not be able to revise them in any way). In addition, individual Certificates of Insurance will not be given to your building, but each entity that is named within the licensing agreement will be covered by the city’s insurance. The agreement is where a building would place the building’s name, management company’s name and any other parties that wish to be covered.

For buildings that are larger than 250 units, the city is happy to organize outdoor events on your property, with an e-cycleNYC truck and storage bins for the day. There are a few conditions that the building must maintain in order to host this event. The event must be held in an available outdoor space, such as a parking lot, it can take place any day of the week or weekend (a maximum of four hours) and it must be scheduled with e-cycleNYC at least 60 days in advance. It would be best if the building owner / managing agent could also publicize the upcoming event to all residents, at multiple times during the lead up to the event so that the event will result in higher levels of recycling by those looking to offload their old electronic devices. A resident survey or sign-up sheet will be utilized for e-cycleNYC to gauge the level of staffing needed.

If your building has a bin and would like to have the items removed form the subject property, you can schedule the pickup by calling 212-437-4647 or e-mailing [email protected]. Within three (3) business days, e-cycleNYC will replace your bin with an empty bin.

The last part of this installation and compliance with the e-cycleNYC program is that a representative from either your management company or from the building must attend a seminar given on this subject, at the Department of Sanitation, to go over all of the above information and to have any questions answered. You can call or e-mail the e-cycleNYC program to schedule by using the information given in the paragraph just above. If you are a part of a management company that manages multiple buildings, such as ours, one seminar attendance can cover each of the properties in your portfolio, but a separate license agreement would be needed for each individual property in your portfolio.

Have you run into this scenario before; a Board member resigns during their term and the Board of Directors (or Managers), collectively, appoints a replacement to the position that was just vacated? It should be smooth sailing and without issue, but if this is a cooperative or condominium with an opinionated ownership base, they’ll want to know why the new Board member wasn’t appointed by the shareholders or owners, as a whole.

While it would seem that putting it out to all shareholders or unit owners would be a great idea, it’s not often done, for a variety of reasons. One reason is that it is difficult to get all shareholders and owners to another meeting that is not the Annual Meeting and it is much quicker to appoint someone who is interested in serving on the Board for the remainder of this term. In some cases, there may be a committee member who has been serving on the periphery of the Board and this is a great opportunity to increase their level of participation, if it has been shown that they have something to offer, beyond just filling an open seat.

The reason that the Board will have the final say of who to appoint, in most cases, is provided for in the Bylaws of the building. For instance, below is a partial section of the Bylaws from a NYC cooperative, as it pertains to Vacancies:

When any vacancy exists or occurs among the directors by death, resignation or otherwise, the same shall be filled for the remainder of the term by a majority of votes cast at a special meeting of the remaining directors duly called for the purpose or at any regular meeting of the directors, even though a quorum shall not be present at such special or regular meeting.

As you can see in the above paragraph, the Board has complete control over who they appoint to fill the remainder of the term that was vacated. This could be a period of only a few months or it could be a multi-year term that the new appointment will fulfill.

Just because an appointment was made to the Board does not mean that the shareholders or unit owners are completely without hope if they absolutely disagree with the new appointment. If for any reason they are completely unhappy with this appointment, or the Board in general, the could also look to their bylaws to remove either one or more persons from the Board. They would have to follow the passage in the Bylaws that pertains to removal. From the same NYC cooperative bylaws on Removal:

Any director may be removed from office at any time with or without cause and at the pleasure of the shareholders, upon affirmative vote of the shareholders of record taken at a shareholders’ meeting duly called for that purpose; provided, however, that the directors elected by the holders of Unsold Shares can be removed without cause by such holders of Unsold Shares who alone will have the right to designate a replacement.

There’s no way that each and every shareholder or unit owner will be appeased in each situation, and this is a great example of this. More often than not, the Board will have someone in mind to fill a space on the Board if one should become vacant for any reason during the term of service. It’s up to the shareholders or unit owners to take matters into their own hands if they feel their interests are not being properly represented by the existing Board members.

As I always say, if you’re unhappy with the Board you have, throw your name into the ring the next time around and get on the Board to make a change.

The New York City Department of Finance has recently changed its application process for the Co-op and Condo Property Tax Abatement (“CCA”) for unit owners. Unit owners can now apply for the CCA by completing the Homeowner Tax Benefit Application (click here to download). The revised application now includes CCA in addition to other benefits, such as STAR.

The following groups can now apply using this form:

– Unit Owners who purchased their unit / shares by January 5, 2015 are eligible to apply for the 2015 / 2016 tax year (July 1, 2015 – June 30, 2016). The filing deadline for this tax period was March 16, 2015.

– Unit Owners who purchased their unit / shares after January 5, 2015 should apply for the 2016 / 2017 tax year when that application (the updated links in this post now point that new link).

Please note that to be eligible, you must must use the subject unit as a primary residence and you can not own more than three residential units in the co-op or condo development.

If the unit is owned by a business entity, such as an LLC or a sponsor, your unit is not eligible for the abatements from the city.

In order to apply for the Abatement, you can view and download the application at this link: http://www1.nyc.gov/assets/finance/downloads/pdf/payment_operations/exemptions_appl.pdf or you can call 311 and have the application mailed to you.

In addition, as a new policy that is in effect for 2015, an application will be given out at each closing for a new Shareholder or Unit Owner so that they may have the information as soon as they purchase a unit.