Volume 18 • Issue 24 | Oct. 28 - Nov. 3, 2005

Southbridge Towers votes to study going private

By Vanessa Romo

Proponents of a study analyzing the effects of privatizing Southbridge Towers, a Mitchell-Lama co-op, celebrated a double victory last week. A referendum to move forward with the study was passed with overwhelming support; shareholders voted 2 to 1 in favor of the study that could cost up to $25,000. And a vote on a tax abatement program that would require the 1651-unit co-op to remain in Mitchell-Lama for another 15 years, scheduled for Oct. 26 and 27, was canceled.

The turn out for the election was one of the largest in the co-op’s history; 740 shareholders voted in favor of the study and 353 voted against it.

The final tally was announced on Oct. 20, just one hour after the polls closed, and elicited cheers and applause from the 100 or so shareholders still present, said Rosemarie Ferrara, who voted for the study.

Paul Viggiano, president of the co-op’s board of directors, called an emergency meeting on Friday, Oct. 21 and with the support of 11 board members, moved to postpone the vote on the J-51 tax abatement program until “after the privatization study is complete and disseminated among all shareholders.”

A vote approving the co-op’s participation in the J-51 program, which would allow it to be reimbursed for a percentage of money spent on capital improvements, would automatically void the referendum in favor of the study.

Tenants in favor of studying privatization had accused Viggiano and the board of rushing the J-51 vote before it was necessary. Viggiano claimed he always considered canceling the J-51 vote, but he never mentioned that possibility in several interviews prior to the privatization vote.

Board member Victor Papa said postponing the vote was the right thing to do. “It would be bad faith to delay the study. To show good faith, it would dictate that we postpone the [J-51] vote until the privatization study is complete, then people can know what they want to do,” he said, and added, “That makes the question of J-51 more legitimate.”

The study could be the first step in the legal process of dissolving the Mitchell-Lama co-op. It would assess the market-rate value of the commercial and residential properties and determine changes in maintenance, appliance and utilities fees. The complete process of converting to a private co-op could take up to three years.

Viggiano said he plans to appoint an ad hoc committee to oversee the feasibility study within two weeks. “I have to figure out how to form a fair and unbiased committee to represent shareholders’ concerns,” he said. The interests of low- and middle-income residents, senior citizens with fixed incomes, and the wealthier residents all have to be taken into account, he said.

The committee would be responsible for hiring a firm to conduct the study and determine when the study would begin. But Viggiano said, “I’m going to move it along as fast as I can. There will be as little delay as possible.”

Jared Brown, founder of Southbridge Rights, the group responsible for the referendum on the study, wants Viggiano to include an accountant or attorney who has experience with a co-op that successfully privatized on the oversight committee.

Southbridge Rights is also calling for a shareholders meeting to address the community’s concerns before the oversight committee is appointed. However, Viggiano said there are no plans for an open forum in the immediate future. “First I would like to form the committee. After that is formed and we meet, then at some point I’d like to have a shareholder’s meeting to explain what the committee is going to do, their objectives and where we intend to go,” Viggiano said.

Opponents of the study and privatization expressed mixed feelings about Thursday’s outcome. “I am disappointed because I think we’re wasting money,” said Laurence Vide, 81, who has lived in the building since Nov. 7, 1970, a day he remembers as one of the happiest in his life. “In the end it may not be worthwhile, but since 740 people were able to show up and say they want the information, what can I do?” he asked.

Like most shareholders on both sides of the issue, Vide hopes the study will dispel all of the rumors and half truths regarding privatization that have been circulating within the complex for years. “I’m hoping it will be honest and then everyone will know the real truth about what they’re getting into,” he said.


Home

Downtown Express is published by
Community Media LLC.
Downtown Express | 487 Greenwich St., Suite 6A | New York, NY 10013

Phone: 212.242.6162 | Fax: 212.229.2970
Email: news@downtownexpress.com


Written permission of the publisher
must be obtainedbefore any of the contents
of this newspaper, in whole or in part,
can be reproduced or redistributed.