Coop looking at another deficit this year

The management office released the budget yesterday for the fiscal year ending 6/30/17, showing an expected deficit of $970,000, a little better than last year’s (unaudited) $1.4 million shortfall.

A few notable items from the full budget:

  • As the accompanying memo from management points out, increase in expenses this year of $900,000 is entirely due to our real estate taxes going up by that amount.
  • You can thank last year’s 11% maintenance increase for the $1.3 million increase in revenues expected this year.
  • Aside from carrying charges, other revenue is expected to go down.

Despite starting off the first 7 months of the fiscal year lower than last year, the budget expects flip tax revenue to remain just about even from last year. But without a big spring bump, flip tax revenue will be $400,000 – $500,000 less than projected. The board is again using inflated flip tax projections to mask what is likely an even larger deficit.

On another note, while memos from board president Gary Altman and management often find ways to praise our local councilmembers, state reps, or governor, the memo announcing the budget’s release made a pointed dig at the mayor: “The city’s budget has risen $12 billion dollars since the Mayor took office 3 years ago and East River’s real estate taxes have risen by millions of dollars.” In an election year, no less!

More specifically, East River’s RE taxes were down slightly during Di Blasio’s first two years, but have risen sharply ($1.8 million or 30%) since. That’s a tough increase to cover without even more maintenance increases. Borrowing more money would help for one year or two, but taxes won’t be going down. This is a recurring and growing expense that will need to be met by recurring income.