Are Large Assessments Avoidable? How to Tell Emergencies from Just Poor Planning

Take a trip with me across the beautiful Hudson River, to West Orange, New Jersey, where homeowners in a condominium community are currently being billed an average of $30,000 per household to replace faulty siding. As reported by CBS New York, the board claims that the siding had been breaking bad ever since the structures were improperly built in the 1980s. Despite owners’ objections, the board is technically allowed to assess such charges and make such decisions on the owners’ behalves.

When asked for comment by CBS2, the president of the Board of Trustees David Kesselhaut, allegedly left a voice mail for residents in which he chided them for going to the media and said the project is going forward as planned. He refused to comment directly.

Making an Assessment of You and Me

Of course, this is far from the first time that an association has levied either a large assessment, an assessment that necessitated a quick turn-around, or both, on a condo or co-op. In 2014, the residents of 2 Fifth Avenue (as covered by the New York Times here), a prestigious co-op, was forced to come up with $30 million to replace a leaky facade that threatened the structural integrity of the property. The in-fighting over how to pay for the repairs led to a mutiny by some of the ownership, who rallied like minds and unseated the incumbent board in an election, implementing its own strategy to finance the project.

Perhaps the big kahuna—an assessment that is believed to be the highest ever in Boston—comes from Harbor Towers Condominiums, where unit owners were hit with a $76 million bill in 2008 to replace the HVAC system in the community's two waterfront towers. The one-time assessment, ranging from $70,000 to $400,000 per unit owner, led to a bitter political struggle and assertions by some residents that they would have to sell their units to pay the huge bill.

Anyone can play Monday-Morning Quarterback or tell you exactly what the White House is doing wrong, but it's different when you have to make the tough decisions. But are these assessments just passing the buck to unit owners, when boards refused to make those tough decisions over a period of years? Or are they real emergencies?


Related Articles

When Associations Borrow

What to Know Before Taking Out a Loan

Everything You Wanted to Know About Jumbo Loans

How Are They Different From Conventional Loans?

East Flatbush Co-op Mired in Legal Drama Receives $11M Loan: Report

The Mitchell-Lama Co-op Has Experienced Internal Turmoil

Building Demolition

Managing Chaos, Minimizing Disruption

Q&A: Capital Assessments

Q&A: Capital Assessments

Extending Your Elevator's Life

What Can Boards Do?