Co-op Heads Up - 27 East


Southampton Press / Opinion / Letters / 1782167

Co-op Heads Up

I just sold a co-op. Let’s call it East End Manor. What I realized while doing my taxes is something that every co-op shareholder should recognize about their maintenance increases.

I bought my shares in 2003. But over the 41 years of East End Manor’s existence, there have been nine 5 percent maintenance increases, each of them regressive, despite 22 of its 25 shareholders holding fewer than 5 percent of its shares. The shareholder with the fewest shares has 3.1 percent of total shares.

With every 5 percent increase, they overpay by 1.9 percent, or 17.1 percent given nine increases. The shareholder with the most shares has 8.58 percent, meaning they underpay by 3.58 percent with every increase, to now total 32.22 percent.

The co-op is a lemon: Its five-person board is composed of one shareholder who underpays by 32.22 percent and four others who overpay from 12.6 percent to 17.1 percent.

What’s amazing is that in my 17 years, no one else picked up on it.

Billy Sternberg