Page 6 - New York Cooperator February 2020

6 THE COOPERATOR — FEBRUARY 2020 COOPERATOR.COM Providing a Full Range of Architectural & Engineering Services In-house professional expertise in: Exterior Restoration & Historic Preservation Construction Inspection Alteration Review Architectural Design Engineering: n Mechanica l n Electrical n Plumbing n Structural Energy Audits Forensic Investigation Façade Safety Inspection Program Reporting Green Design – LEED Professionals Client satisfaction assured by the active daily involvement of the firm’s principals www.lawlessmangione.com info@lawlessmangione.com 914.423.8844 through kickback and bid-rigging schemes in emergency situation, obtaining bids just isn’t another residential real estate industry scan- dal. According to a Department of Investiga- tion’s press release about the latter indict- ments, “Bid-rigging and kickbacks have obvi- ously been a way of life for many years in the efi t from their longevity, where institutional residential real estate industry. But...today’s knowledge, personal comfort, and familiarity coordinated response by local law enforce- ment will go a long way toward ending this weighs saving a few bucks by switching to a cycle of greed.” By all accounts, it has. While there are undoubtedly still unscrupulous administra- tors continuing to pocket money under the he and other attorneys advise against add- table from vendors, there is a common un- derstanding that those schemes and tactics not simply “at the discretion of the board.” are part of an unsavory past. Gruen herself is While an organization might be tempted to happy that bygone crackdowns have cleaned add language around the bidding process to up the industry, to the point that she almost its documents in an eff ort to avoid confl icts wishes there were more to come, because it or the appearance of such, doing so could would make reputable businesses like hers have the eff ect of gumming up the works, smoother to operate. Intensifi ed scrutiny from law enforce- ment—and from boards and management or contracts over a certain monetary thresh- fi rms themselves—has led to a more ethical old is an unnecessary muzzle on the board’s and accountable industry all around, but a judgment, and assumes prior cost estimation. savvy board should still keep its eyes open, Even more constraining, a clause that triggers and not hesitate look closer if something a shareholder or unit owner vote on projects seems off . “Th ere are no stupid questions,” over a certain dollar amount would stymie the Wagner reminds us. “Ask the question. Chal- lenge authority. I’ve seen some crazy things complicate confi dentiality. that were picked up by board members who just didn’t understand and asked the ques- tion.” When You’re On Your Own So far we’ve focused on the bidding process and balances, and knowing when to ask ques- when professional managers are involved. But tions will go a long way toward keeping the where do self-managed communities turn to process fair and legal. fi nd qualifi ed bidders, write an RFP, level bids, and interface with potential vendors? Given enough time, forethought, and planning, a self-managed board can defi - nitely get the job done. First, you already have a great resource: Th e Cooperator! Our on- line Directory of Co-op and Condo Services (www.directory.cooperator.com) includes an exhaustive list of relevant professionals cover- ing everything from legal services to HVAC repair. But if your board simply doesn’t have the time, or doubts its ability to navigate the pro- cess itself, there are other options. One such option is Th e Bid Lab, a New York-based consulting fi rm that focuses exclusively on the RFP process on behalf of small and medi- um-sized nonprofi t boards. Maurice Harary started the company with his business partner in 2017, drawing from a background in busi- ness and procurement to put together a team of experts to help boards in the quest for new vendors, contracts, and services. Bids, Adieu All of this may beg the question: does ev- ery contract or project need to be bid out? According to Richard Brooks, a partner at the law fi rm of Marcus, Errico, Emmer, & Brooks in Braintree, Massachusetts, the short answer is no – at least not legally speaking. He says it’s really more an exercise in common sense. Small jobs don’t merit taking the time and eff ort to solicit multiple bids, and in an practical. Brooks adds that when it comes to longer-term contractual relationships like with a manager or an attorney, “Th ere’s no reason to go out to bid unless things aren’t going well.” In fact, those relationships ben- with the property have value that likely out- diff erent provider. Governing documents are also pretty much silent on bidding, says Brooks, and ing provisions for obtaining bids that are so to speak. For example, Brooks points out that requiring a competitive bid for projects board’s decision-making process and could Ultimately, the process of bidding out proj- ects on behalf of a community is just another part of a board’s duties to their consituents. Understanding the basics, maintaining checks n Darcey Gerstein is an Associate Editor and Staff Writer for Th e Cooperator. BIDDING... continued from page 2 you shouldn’t recommend him for roof re- pairs to the building. In the more abstract sense, Davidson points out that adherence to this duty is less clearly defi ned in a co-op or condo than it may be in other not-for- profi t organizations, because in a residential context, every board member presumably owns a unit or shares and may make deci- sions based on what may benefi t them but not their neighbor. “While co-op and condo boards repre- sent nonprofi t corporations and associa- tions, they are, at their core, somewhat dif- ferent from non-residential nonprofi ts,” he says, “because the board members are in- vestors or owners in the nonprofi t and their board positions carry a heavy fi duciary re- sponsibility.” An example might be voting to permit Airbnb rentals. Doing so might provide a particular board member with additional income, but their neighbor(s) might not want strangers in the building. MANAGING... continued from page 1