Monthly Report

- by Marion Scott

- by Jay Williams

General Manager’s Monthly Report for January 2023

Communication

When I arrived at Rochdale in 2014 as the Assistant General Manager it was articulated to me, by Mr. Scott and Alex Freedman, that my focus would be on Shareholder communication. For the first 2 years of my tenure, I spent a lot of time reviewing, resolving and answering the many correspondences that were sent to the management office. As my responsibilities grew, we moved Mr. Keller into the permanent role of Ombudsman with shareholder communication as his sole task. Though I had moved on from being the de facto Ombudsman, communication has remained at the forefront of my management style. Experience has taught me that conveying the ‘who’, ‘what’, ‘where’, ‘when’ and ‘why’ of any situation is important. It provides better understanding from our shareholders of a given issue and lets them know that we are aware and on top of the problem. A lack of communication can cause rumor and conjecture takeover causing ill sentiment and foster mistrust. Management has continued to increase the amount of information available to our Shareholders using methods old (Bulletin, Weekly Sheet, Posted Notices) and new (Alert System, Digital Board, Zoom, Facebook). If you have not signed up to be a part of the alert system, please reach out to Ms. Richards at 718-2765700 ext. 3602.

Carrying Charge Increase Update

The first stage of our carrying charge increase of approximately 3.8% is scheduled to begin on February 1st, 2023. The Board and Management ensured that we supplemented the standard New York State Homes and Community Renewal (“HCR”) correspondences that included a door-to-door and rent conference with our own management newsletter, alert, Facebook posting and Zoom meeting/Q & A. We understand that the HCR notices can be confusing. For reference on how the increase affects you please see the following chart:

Our 3 Main Bank Accounts

During the Management carrying charge increase and rent conference I noticed a general misunderstanding of our 3 main bank accounts: the Operating Account, the HCR Reserve Account and the Wells Fargo (Capital Improvement Account). Our operating account is used primarily for the day-today operation of Rochdale Village. While this account can be used to fund projects or purchase machinery, this account is primarily used to pay our monthly bills. Some of the expenses that fall under this category are supplies (floor cleaner, mop buckets, doorknobs), contracted services (plumbing, exterminator), employee salaries, insurance, mortgage, etc. As stated in previous management correspondences, sharp increases in operational expenses post COVID have increased these expenses significantly. The current increase is to bolster this account and cover our budget deficit.

The HCR Reserve Account is overseen by HCR and funded monthly at a rate of $195,000 per month ($2.34 million per year). While this account can be used to fund projects or purchase machinery, this account is primarily used to cover unforeseen emergencies such as shortfalls in vital operational expenses and emergency repairs (turbine fail- ure, gas leaks).

The Wells Fargo (Capital Improvement Account) originates from our 2019 refinance and can only be used for capital work. The capital projects chosen are an amalgamation of infrastructure items identified from our site conditions survey, done by a 3rd party engineering firm, and Management. The full list of projects is located in the projects section of the Bulletin monthly.

A Year In Retrospect

Here at Rochdale Village, we maintain the philosophy that the day-to-day operation, projects and major capital improvements are addressed in a way that keeps the Carrying Charges affordable for our demographic. Simply stated, it is our responsibility to get the work done while at the same time ensuring you as shareholders are not displaced due to exorbitant increases. COVID-19 has made that very difficult for the past 3 years. The bottom line is that nobody likes it when carrying charge increases must be implemented, including management. Management doesn’t gain any financial advantage when our shareholders pay more. We get the brunt of the blame when increases inevitably occur no matter how prudent we’ve been controlling expenses in the past. The fact is that Rochdale’s carrying charges are way below the NYC definition of affordable rents (see chart below) and many more leagues below market rate apartments with more amenities. These results are not accidental, they are the fruit of your Board and Management hard at work to keep Rochdale affordable.