Should condo and co-op board members receive compensation?

New York /
Jul.July 18, 2011 03:01 PM

With many New Yorkers no longer wanting to serve on co-op or condominium boards without compensation, the question of whether or not these positions should be salaried is becoming a contentious issue, Habitat Magazine reported.

Mark Hankin, the attorney for a Queens co-op was appalled, he said, when the co-op’s board members invited him to their annual weekend getaway, or “thank you retreat,” and the directors rewarded themselves there for their work at a $5,000 price tag each. “We earned it,” the president told the attorney. Hankin remembers telling the president that the behavior was unacceptable. “Serving on a board,” he remembered saying, “is a volunteer position, as in ‘no pay’ and ‘no thank yous.’”

Arthur Weinstein, a longtime co-op and condo attorney, said he finds the notion of compensation inappropriate. “It might create the wrong incentive,” he said. “They’d be serving for the money rather than for the good of the building.”

Reluctance to offer these roles as salaried positions dates back to the 1940s, Habitat said, when the Federal Housing Association issued “Model By Laws” requiring the consent of shareholders in order to pay board members. However, there do not appear to be any city, state or federal laws prohibiting the payment of board members with consent from unit owners.

In fact, there is a nine-unit Manhattan co-op in Midtown East that pays $515 per month to board members as the building does not have the cash to hire an outside management company. The exact address of the building was not available. [Habitat Magazine]


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