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Riverbay Board unanimously approves 6% discount for Coop City shareholders who prepay carrying charges

At an Open Board meeting held Wednesday evening, January 13, 2016, before approximately 80 Coop City shareholders in the Bartow Center, the Riverbay Board of Directors unanimously approved a resolution which grants an approximate 6% discount on carrying charges to shareholders who pay their annual carrying charges in advance; pending New York State Division of Home and Community Renewal (HCR) approval.



The resolution specifically directs Co-op City's Riverbay management to seek approval of the prepaid carrying charge program from the New York State Division of Home and Community Renewal (HCR) and develop a detailed plan for implementation so shareholders who are interested in participating will be able to prepay their annual carrying charges and in return receive a 6% discount. The offer to Coop City shareholders is hoped to raise approximately $10.1 million which would allow all of Coop City to prepay its New York City water and sewer charges under New York City's Multi-Family Conservation Program (MCP) thereby saving the community and its shareholders $1.4 million on annual water charges.

Riverbay Finance Department Director, Peter Merola, said that with February 2016 carrying charge statement, shareholders will receive a detailed explanation of the program, plus a tear off sheet on which they can indicate if they are interested in participating in the prepaid carrying charge program. This preliminary indication is not a commitment to the program, Merola indicated, but just a way for management to gauge interest in the Co-op City community and know who to contact when it becomes time to formally implement the program, which is voluntary. Given the need for New York State Division of Home and Community Renewal (HCR) approval and further inspections and meter installation by New York City, should such permission be granted, it can possibly take up to six months before formal implementation of the program begins, Merola said.

Under the plan, as presented by Riverbay Board President, Cleve Taylor, who submitted the approved Board resolution Wednesday evening, half the savings of the program would be passed onto Coop City shareholders who participate by prepaying, which comes to approximate 6% carrying charge rebate, while the other half of the savings goes back to all Co-op City shareholders in the form of additional revenue for Riverbay's operating expenses.

Riverbay Finance Department Director, Peter Merola, estimated that 865 Coop City shareholders need to participate in the prepayment package in order to raise the needed revenue to participate fully in New York City's Multi-Family Conservation Program (MCP). But even if Riverbay does not get the needed 865 participating shareholders to prepay, it can still participate in the MCP program partially by switching over as many building as the extra revenue raised by the prepayment program will allow.

Based on questions raised by several Co-op City shareholders, who spoke during the gallery session prior to the Board discussion on the two main resolutions on the Board's agenda that night, it was stated by Riverbay Finance Department Director Merola to the Board and the Co-op City residents in attendance that participating shareholders must prepay for the entire year and not partially.

However, it was also made clear that if a participating shareholder should happen to leave the community or pass away before the prepaid year is finished, that shareholder, or his or her estate in the case of a death, would be reimbursed for the months that the shareholder was no longer living in the community so long as proper proof and paperwork is filed by that shareholder or a designated legal administrator of the estate, in the case of a death.

Before the vote of the original resolution was taken, Riverbay Board Director, Deborah Jenkins, asked that an amendment to the resolution be added to state that if participating shareholders leave the community before their prepaid year is over, they will be reimbursed for the months they were no longer a shareholder. A consensus vote among attending Riverbay Board Directors was taken to add the amendment.

Following that, the resolution was passed unanimously by all 12 Directors in attendance: Linda Berk, Bernie Cylich, Bill Gordon, Deborah Jenkins, Daryl Johnson, Francine Reva Jones, Andrea Leslie, Leslie Peterson, Rod Saunders, President Cleve Taylor (by phone), Evelyn Turner and Junius Williams, Directors Helen Atkins, Leah Graham and Rev. Calvin Owens were absent.

Riverbay Board President Cleve Taylor, the sponsor of the resolution and perhaps its biggest proponent, could not attend the meeting in person because of an illness, however, he participated in the meeting by phone, voting for the resolution and prior to that, arguing effectively for its passage just as he did in his President's Report published in the Coop City Times days before the meeting.

But as he experienced success with one resolution he sponsored, a second resolution submitted by Taylor and seconded by Director Bill Gordon was never voted on. The resolution called for equity charges for incoming and transferring shareholders to be raised for the first time in nearly eight years, from the current $4,500 per room to $5,500 per room. Because of his illness, Riverbay President Cleve Taylor was forced to make his arguments over speaker phone stating that he believed an increase in equity, after eight years, was more than justified given the current market for homes in New York City and the needs of the community's more than 15,000 shareholders to raise additional income to pay for inevitable and needed repairs and improvements in the coming years; specifically a needed elevator repair and upgrade in 2017. Taylor argued that raising the equity charges for new sales would increase Coop City's operating funds by approximately $1 million dollars. Taylor also argued that equity charges are refunded fully when the shareholder moves from the community except in cases where damages caused by the resident have to be repaired.

But at the evening's gallery session, prior to the Riverbay Board discussion of the resolutions on the agenda, a few shareholders, including Harriet Silver, a frequent participant in gallery session, argued against the equity charge increase. Ms. Silver stated that she believes such an increase goes against one of the founding principles of Co-op City; that of providing affordable housing to middle and working class individuals and families. Silver added that the Coop City Coalition to Save Affordable Housing, has also stated its opposition to the equity charge increase.

When discussion on the equity increase began later in the evening, several Board Directors expressed their opposition to the increase, with a few even pointing to their agreement with Ms. Silver's stated views as one of the reasons they stand opposed to it. At least seven directors voiced their opposition prior to the vote being taken and at that point, President Taylor announced, via speaker phone, that he wished to withdraw the resolution.

Another resolution on the agenda involved a possible change in the community's election procedures beginning with this year's upcoming Riverbay Board elections. Director Francine Reva Jones, who was appointed Chair of this year's Election Committee, pointed to the approximate $100,000 cost of conducting the election through NYC Board of Election voting machines. Director Jones suggested that the Board begins looking into other options that might be less expensive, but still maintain the absolutely necessary integrity of the voting process. The Board voted by consensus, and unanimously, to continue further exploration and discussion of this issue in the coming weeks.

The Open Board meetings began with a brief management report delivered by Assistant General Manager Warren Mitchell. Mr. Mitchell touched on some recent accomplishments by the management team, including the hiring of an established commercial broker, KZA Realty, to get increased value for Riverbay's commercial properties. He pointed out that because of this relationship, the community will be able to realize approximately $4.5 million due to a lease renewal with Rite-Aid. He also pointed to the recent hiring of a Procurement Director, a new Internal Auditor and a new Riverbay Corporation Human Resources Director. He said that all these new executives have improved efficiency, transparency and services to Co-op City's shareholders.

An additional project includes increasing Wi-Fi service throughout the community under the direction of Riverbay Technical Services Department Director Rick Schmidt who spoke briefly about the project.

Wednesday's Open Board meeting also featured a videotaped report on the current state of Coop City elevators.

In the absence of an ill President Cleve Taylor, Riverbay's First Vice President, Linda Berk ran the proceedings. The meeting was adjourned at approximately 10 p.m.

For Co-op City residents who could not attend, the entire meeting was video recorded by multiple cameras and will be broadcast beginning at 7 p.m. on January 18, 19, 20 on Coop City's MATV Channel 12 and Cablevision Optimum Channel 591.

By Bill Stuttig
Coop City Times is now online

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