The city’s Department of Finance (DOF) has released the Tentative Assessment Roll on property taxes for the 2023 fiscal year, which runs from July 1, 2022 to June 30, 2023. That means property managers and accountants at many co-ops and condos are now in a race against the clock. They have until Feb. 15 to advise boards on a critical question: Should they begin paying their non-union employees the prevailing wage in order to keep receiving the cherished co-op and condo property tax abatement, or should they keep their current pay and benefits structure and forfeit the abatement?
The question is driven by a law signed on Labor Day 2021 by Gov. Kathy Hochul. It requires buildings with non-union staffs to pay prevailing wages (and benefits) in order to qualify for the co-op and condo tax abatement, which ranges from a hefty 17.5% to 28.1% of shareholders’ or unit-owners’ property tax bills. (The prevailing wage schedule for building service employees, which is set by the city comptroller, is available here. Buildings with unionized staffs will not be affected by the law.)
“It’s going to be a big deal for some properties,” says Robert Ferrara, president of the Ferrara Management Group. “We have a hard time finding employees for buildings that are non-union or don’t offer specific benefits such as health care and a 401-k. It’s difficult to beat what the union offers. If co-ops and condos lose this abatement — at a time when all costs are going up — it will hurt.”
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