Ask an Expert

I just got a maintenance increase for a new elevator. Is it permanent?

Teri Rogers Headshot - Floral
By Teri Karush Rogers  |
June 24, 2009 - 11:46PM
BrickTankQ logo.Icon2.jpg

Q: I just got another increase in my maintenance bill, this time for elevator replacement. Does this fee stay forever in my bill since it's a capital improvement?

A: That depends on whether your board financed the elevator through a “special assessment” or through a second mortgage, explains Lynn Whiting, a BrickTank expert and the director of management for The Argo Corporation, a Manhattan-based property management company.

You should have received a notice from your managing agent explaining how the elevator is being financed. (If not, ask.) Additionally, if the elevator is being paid for with an assessment, there should be an assessment line item on your monthly maintenance bill.

If, on the other hand, the project is being funded through a second mortgage (or a credit line drawing on the second mortgage), then you are looking at a permanent increase. This may seem unfortunate and even shortsighted, but longterm borrowing to fund a co-op capital project is actually quite common and "very responsible," says Whiting. Spreading the cost of a big project out over a long time also makes it more affordable in the short-term, when a huge assessment could destabilize recession-struggling co-op owners.

Borrowing is not usually an option in condos, however. It requires approval by 66 2/3% of unit owners, so assessments are the preferred form of fundraising.

Problems at home? Get expert advice! Send us your questions through our feedback form.

Teri Rogers Headshot - Floral

Teri Karush Rogers

Founder & Publisher

Founder and publisher Teri Karush Rogers launched Brick Underground in 2009. As a freelance journalist, she had previously covered New York City real estate for The New York Times. Teri has been featured as an expert on New York City residential real estate by The New York Times, New York Daily News, amNew York, NBC Nightly News, The Real Deal, Business Insider, the Huffington Post, and NY1 News, among others. Teri earned a BA in journalism and a law degree from New York University.

Brick Underground articles occasionally include the expertise of, or information about, advertising partners when relevant to the story. We will never promote an advertiser's product without making the relationship clear to our readers.

topics: