City says Southbridge may be rushing tax vote
By Vanessa Romo
A vote next week by Southbridge Towers shareholders to determine whether the co-op will opt to continue with the Mitchell-Lama program for an additional 15 years and continue to receive tax abatements may be premature according to the citys Department of Housing and Preservation Development.
Southbridge Towers, a co-op complex in the Seaport, has scheduled a tenant vote for Oct. 26 and 27 to decide whether to extend a tax abatement program for capital improvements called J-51. If they vote yes, tenants wouuld be locked into Mitchell-Lama, a middle-income rent program, for another 15 years.
However, Carol Abrams, a spokesperson for H.P.D., the supervisory agency for the citys Mitchell-Lama buildings, said recent changes to J-51 tax abatement programs passed by the state legislature in June 2005 will not affect New York City Mitchell-Lama co-ops until the bill is passed by the City Council. The legislation is still pending, so it is unknown if Southbridge Towers will even be eligible or not, she said.
If the changes are approved, then Mitchell-Lama co-ops assessed at more than $40,000 per unit will be eligible for capital improvement benefits. Currently, co-ops assessed in excess of this amount are ineligible.
Paul Viggiano, president of the board of directors, disagrees with the city about the lack of urgency of the vote and said it was scheduled after the Department of Finance valued the co-ops at $44,000 per unit. If we dont vote on this now then we will not be eligible for any of the benefits in the future, he said.
Abrams said the $44,000 assessment may not be the final number used when considered for the J-51 benefits.
Work on the roof of the 1,651-unit complex is currently underway. Window and concrete improvements are also needed, but work has not started on these projects, he said. It seemed like a good opportunity to get it all over with, Viggiano said referring to the J-51 vote and the Oct. 19-20 vote on whether to study the merits of privatizing the co-op.
But shareholders and long-time residents such as John Ost, said the J-51 vote seemed rushed and complained of feeling uninformed about the issue. There is no urgency to have the J-51 vote, Ost said. We were supposed to have another meeting to discuss all these issues and what it would mean for us to commit to another 15 years in Mitchell-Lama, and that never happened, he said.
Viggiano felt the shareholders had enough information to vote on the J-51 issue, which is why he did not organize another meeting, he said.
Abrams said that theres no rush to vote on the J-51 issue. Southbridge Towers current status as a Mitchell Lama co-op would not change, unless the shareholders initiated a dissolution process which could take up to three years, she said. If the shareholders vote no next week and opt out of the J-51 program at this time, they could reapply at a later date, Abrams said.
Until then, the co-op would also continue to receive a 90 percent tax exemptions on annual real estate taxes.