In-force pay rate calculator helps co-op and condo boards do the math
Almost 4,000 councils of cooperatives and condominiums facing a daunting deadline just had good news. For those tips, there is a free tool called the Going Wage Rate Calculator that will help them determine going salaries and additional benefits for their building staff. The boards then have up to April 15 make an important decision: do we pay prevailing wages to our employees in order to keep the tax reduction for cooperatives and condominiums — or should we give up the reduction and keep our payroll intact?
“There is a great sense of anxiety there,” says James Parkfounder of SparkSuper.com, a third-party company that supplies over 50 co-ops and condos with supers, porters, and handymen. “Boards have a duty to all of their constituents to get it right, because there’s a lot of money at stake and no one wants to be caught in an audit.”
SparkSuper.com works with some major property management companies – Akam, FirstService Residential, Andrews Organization, Tudor Realty and MD Squared Property Group, among others – and when the April 15 deadline started appearing on their radar screens, Park saw a need for the spreadsheet-based Going Wage Rate Calculator, which guides users through a series of simplified calculations.
“I created it because there’s a lot of confusion about the law,” Park says. “The text is vague. The calculator helps boards and their managers understand that going salary isn’t just about the hourly wage rate. He understands Additional services intended to cover costs such as health care, pensions, travel and training. Employers must also provide personal time off, sick time off and paid time off. Employers must cover all employees, union and non-union, for the cost of workers’ compensation, disability insurance and employer taxes.
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The calculator also takes note of an often overlooked factor that can have outsized consequences. “It breaks down employee costs per hour, including the additional cost of over timesays Park. “People don’t realize what overtime can do to their budget.”
The length of service of the employee and the size of the building are also factors in the calculations. The same goes for the composition of the building. As the tax allowance is only available to shareholders and co-owners who make their apartment their Principal residencebuildings with a high percentage of pied-à-terre are likely to be less inclined to raise labor costs to retain an advantage that benefits a limited number of residents.
The current salary and benefits grid is posted annually by the city Controller. Councils wishing to continue receiving the property tax abatement have until April 15 to submit a notarized affidavit stating that they will pay prevailing wages as long as they receive the allowance. Under a recent extension, the tax relief will last until June 30, 2023. Beyond that, his fate is uncertain, which has added an extra dose of anxiety to the deliberations of many councils.
“I hear concerns about the longevity of the tax abatement,” Park says. “Once a board agrees to pay the going wage, they are stuck.”
The city released a list of nearly 4,000 co-ops and condos that must begin paying prevailing wages in order to continue receiving the tax abatement. Workers who belong to Local 32BJ from Service Employees International Union already receive prevailing wages and additional benefits, unlike many non-union workers and some members of other unions. The average annual cost of a 32BJ gatekeeper totals more than $96,000.
That’s a serious number, but Park has found that some boards aren’t discouraged by it. “Wage disparity expands, and New York City is going to have to deal with that,” he said. “Some board members I have worked with agree with the payment of prevailing salaries because it corrects social inequalities. I’ve heard board members say they need to get health insurance for their super. It’s pricey, but that’s the elephant in the room.
Ultimately, Park distances himself from each council’s final decision. “Whether they decide to waive the allowance or start paying prevailing wages is their choice,” he says. “With the calculator, they will have the information they need to make an informed decision.”