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Co-op City Times / March 25, 2023 Director’s Viewpoint –
Bernard Cylich, Secretary
Unprecedented, Difficult Decision (The following viewpoint was originally printed in the Oct. 12, 2022 CCTimes. It has been updated and is being reprinted this week for shareholders’ information.) The Board of Directors faced an unprecedented, GLI¿ FXOW GHFLVLRQ ZKHWKHU WR LJQRUH DQ 0 VKRUW IDOO RU WR UDLVH FDUU\LQJ FKDUJHV , GRQ¶W UHFDOO LQ WKH \HDU KLVWRU\ RI &R RS &LW\ D 5LYHUED\ %RDUG RI 'LUHFWRUV FRQIURQWHG ZLWK VXFK D GLOHPPD LQ WKH PLGVW RI D EXGJHW SH ULRG 0DQDJHPHQW¶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ote as reported by a Director in CC Times on 1/7/23, median rental for a one-bedroom apartment in the Bronx is $1,900 while the average carrying charge, including gas and electricity, for a 3.5 room unit in Co-op City, is $900.) ,Q VSLWH RI WKHVH PRGHVW FDUU\LQJ FKDUJH LQFUHDVHV WKH RSHUDWLQJ EXGJHW LQ JHQ HUDWHG D VXUSOXV RI 0 DQG VLPLODUO\ WKH RSHUDW LQJ EXGJHW LQ JHQHUDWHG D VXU SOXV RI 0 7KHVH VXUSOXVHV SOXV VDYLQJV IURP RWKHU VRXUFHV KHOSHG NHHS GRZQ LQFUHDVHV ZKHQ ZH QHHGHG WR IXQG RYHU 0 LQ FDSLWDO SURMHFWV LQ FOXGLQJ ODERU DQG PDWHULDOV such as over $70M for Local Law 11 work, $40M for upgrading 160 defective elevators, over $10M for ADA-compliant front lobby doors, etc. Uncontrolled Fossil Fuel Companies’ Greed ,Q 1RYHPEHU VHYHQ PRQWKV DIWHU ZH DG RSWHG D WZR \HDU EDODQFHG EXGJHW LQ $SULO ZLWK D LQFUHDVH WKH ¿ UVW \HDU DQG LQFUHDVH LQ -DQXDU\ ± DSSURYHG E\ +&5 ± 0DQDJHPHQW UHSRUWHG LQ D ³%XGJHW 5HIRUHFDVW´ WKDW ZH ZHUH RQ WKH YHUJH
RI GHIDXOW )URP D VXUSOXV RI 0 LQ $SULO 5LYHUED\ ZDV E\ 1RYHPEHU IDFLQJ D 0 GH¿ FLW ± WKH UHVXOW RI XQIRUHVHHQ UXQDZD\ FRVWV PDLQO\ IRU IRVVLO IXHOV :KHQ ZH DGRSWHG WKH EXGJHW LQ $SULO WKH FRVW RI JDV WR 5LYHUED\ SXUFKDVHG ERWK IRU KRXVHKROG XVH DQG IRU RXU 3RZHU 3ODQW ZDV $2.17 per dekatherm ± HTXLYDOHQW WR JDOORQV RI RLO 6L[ PRQWKV ODWHU WKH IRVVLO IXHO FRPSDQLHV GRXEOHG WKH SULFH WR $4.6 per dekatherm LQFUHDVLQJ RXU XQEXGJHWHG JDV ELOO E\ 0 7R GHDO ZLWK WKLV XQDQWLFLSDWHG ¿ QDQFLDO FUL VLV 0DQDJHPHQW DQQRXQFHG D KLULQJ IUHH]H IRU SR VLWLRQV DQG KRSHG D QHZ PRUWJDJH UH¿ QDQFLQJ SDFN DJH ZKLFK 0DQDJHPHQW KDG VXJJHVWHG WKH %RDUG DS SO\ IRU ZRXOG DOOHYLDWH RXU ¿ QDQFLDO EXUGHQV /DVW 'HFHPEHU WKH %RDUG VXEPLWWHG DQ DSSOLFD WLRQ WR WKH IHGHUDO 'HSDUWPHQW RI +RXVLQJ DQG 8UEDQ 'HYHORSPHQW +8' WKDW SURYLGHG 5LYHUED\ ZLWK D PRUWJDJH JXDUDQWHH LQ WR RQFH DJDLQ SURYLGH VXFK D PRUWJDJH JXDUDQWHH WR UH¿ QDQFH RXU H[LVWLQJ PRUWJDJH ,Q UHFRUG WLPH +8' DSSURYHG RXU DSSOL FDWLRQ LQ 0DUFK ± QRW D PRPHQW WRR VRRQ EH IRUH UDWHV ZHQW VN\ KLJK :H ZHUH JLYHQ WKH JUHHQ OLJKW IRU :HOOV )DUJR %DQN WR SURYLGH 5LYHUED\ ZLWK D 0 PRUWJDJH DW D ORZ ¿ [HG UDWH RI IRU \HDUV :KLOH WKH PRQWKO\ GHEW VHUYLFH UH PDLQHG DERXW WKH VDPH DQG H[WHQGHG WKH ODVW SD\ PHQW RQ WKH SULQFLSOH E\ \HDUV LW RIIHUHG 5LYHUED\ 0 FDVK IRU FDSLWDO SURMHFWV D KXJH EHQH¿ W WR XV Without that cash, cooperators would be facing double-digit carrying charge increases to fund a minimum of $44M for mandated capital projects. 1RW D SOHDVDQW WKRXJKW +RZHYHU LQ VSLWH RI WKH UHOLHI RIIHUHG E\ RXU UH ILQDQFHG PRUWJDJH WKH XQSURYRNHG LQYDVLRQ RI 8NUDLQH ODVW )HEUXDU\ E\ 5XVVLD ± D PDMRU ZRUOG JDV DQG RLO SURGXFHU DQG VXSSOLHU ± JDYH WKH IRVVLO IXHO PRQRSROLHV DQ H[FXVH WR XQOHDVK DGGLWLRQDO LQ FUHDVHV IRU JDV DQG RLO DQG RSHQHG WKH À RRGJDWHV IRU XQFRQWUROOHG LQÀ DWLRQ RQ DOO RWKHU FRQVXPHU SURG XFWV 7KLV LQÀ DWLRQ KDV FUHDWHG VHULRXV KDUGVKLSV IRU JRYHUQPHQWV DQG ZRUNLQJ SHRSOH DFURVV WKH JOREH 5HFDOO WKH SULFH RI EDVLF FRPPRGLWLHV VXFK DV PLON EXWWHU DQG HJJV DOVR GRXEOHG GXULQJ WKDW WLPH %\ $XJXVW WKH SULFH RI JDV 5LYHUED\ SXUFKDVHG GRXEOHG DJDLQ WR $8 per dekatherm, a 400%
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