Dear Shareholders,

Just in case you have missed the e-mail notifications and missed the wording on the annual tax letter, the 2009 annual tax letter from our Accountants contained some very good news! Shareholders are able to claim $71.9053 per share on their federal taxes for the Residential Energy Tax Credit. This is in addition to the normal annual mortgage interest deduction and the real estate tax deduction.

If you have not already filed your 2009 federal tax forms, please include this amount on Form 5695 for up to a maximum tax credit of $1,500. Use IRS Form 5695 to calculate your specific amount you can claim (the amount transfers to IRS Form 1040 line #52). Be sure to direct your accountant to include this amount on your return.

If you have already filed you 2009 tax forms and did not include this amount, you may wish to consider amending your return. It is recommended that you please talk to your accountant about how to do this (or use Form 1040x or similar) as this could increase your refund or decrease your amount due.

This tax credit is only for holders of corporation shares as of 12/31/2009. Please see attached letter where the wording is highlighted.

Sincerely,

Your Board of Directors

The following is a reproduction of a memo sent on 15 January 2010 to all shareholders by our co-op’s certified public accountants: Prisand, Mellina, Unterlack & Co., LLP.

(Download the scanned memo [PDF, 430KB].)

TO: Shareholders of NAGLE APARTMENTS CORP.

RE: PERSONAL INCOME TAX RETURN DATA FOR 2009

Dear Shareholders,

Under the provisions of Section 216 of the Internal Revenue Code, a tenant stockholder of a Cooperative apartment is entitled to deduct from personal gross income a proportionate share of interest and real estate tax paid or incurred by the Cooperative Corporation. Note that these deductions are generally available if the taxpayer itemizes tax deductions.

For the year 2009 your Per Share individual income tax deductions are as follows:

MORTGAGE INTEREST $14.0088 per share

REAL ESTATE TAX $16.3263 per share

For the year 2009, if you were granted any real estate tax abatements, reflected in a maintenance credit or received by check, your real estate tax deduction as stated above should be reduced by the amount of the abatements you received.

In order to compute your total deductions for 2009, multiply the number of shares owned by you, as indicated on your stock certificate, by the amounts per share stated above. If you became a stockholder, or sold your stock in the Corporation during 2009, you are permitted to deduct a fractional part of the figures, based on the proportionate part of the year you owned the stock.

Contributed capital in 2009 was $18.1559 per share for mortgage amortization. This is not a deduction, but an increase in the basis of your investment.

Residential energy tax credits in 2009 were $71.9053 per share for installation of windows.

Should you have any questions regarding the application of the aforementioned information to your individual income tax returns, please consult your personal tax advisor.

PRISAND, MELLINA, UNTERLACK & CO., LLP
Certified Public Accountants

The following is a reproduction of a letter sent on 23 December 2009 to all shareholders by Stephen Vernon, Board President, on behalf of the Nagle Apartments Corp. Board of Directors and Management.

Dear Shareholders,

I wanted to give you an update on the Board’s December 5th annual budget meeting and arrearage. Since the last letter went out, progress has been made both in the Court cases and other arrearage balances. The Board and management will continue to aggressively pursue collection of arrearage balances until the amounts are fully paid.

The Board voted to not increase maintenance at this time for 2010. Some shareholders may actually see a decrease in their monthly charges staring in January 2010 as the annual STAR credits are applied to shareholder bills January through June.

This decision not to increase maintenance at this time comes at a cost. In order to accomplish this, the Board put off some funding to the Capital Reserves and is counting on lower natural gas prices to offset increases in real estate taxes, Water/sewer bills and wages. One of the reasons we are able to do this is the great news that our natural gas usage per heating degree day (a measure of efficiency) is down approximately 40% from 2005 due to Board action on energy issues. With more work to do, we are more efficient now than ever.

As our budget is cost driven, it is unlikely that these actions can be repeated. Deferring repairs only increases costs in the end. Or more properly, deferring saving for repairs only drives up funding needs in the end. However, with the economy the way it is, the Board decided that an increase at this time could be deferred.

You will no doubt notice that I used the phrase “at this time.” Should an adverse budget event cause us a shortage in operating funds, the Board may have to reconsider its decision: but no increase for now.

The Board and Management want to wish you, your family and friends a happy holiday season and a fantastic new year!

Sincerely,

Stephen Vernon, President
On behalf of the Nagle Apartments Corp. Board of Directors and Management

The following is a reproduction of a letter sent on 30 October 2009 to all shareholders by Stephen Vernon, Board President, on behalf of the Nagle Apartments Corp. Board of Directors and Management.

Dear Shareholders,

The Board and Management want to bring an issue to your attention that may have a financial impact to you and to our Co-op. As of the last Board meeting, arrearage in maintenance payments (late payments) has increased to approximately $65,000. This is nearly one month’s worth of budgeted cash collections. In comparison, one of our neighbor buildings consistently has less than $500 arrearage at the end of each month.

While we have reserves and can weather a temporary reduction of collections, we are not in a position to carry this much of a cash loss for extended periods. The Board and Management are working hard to make sure all of the charges are collected. We want you to be informed that if we have to fund this amount as a maintenance increase on next year’s bills, this would add approximately $.48 per share per month to everyone’s charges. Here is what it would look like per month for each type of unit should this occur:

The following table is what it would look like on top of the current $6.05 per share per month for each type of unit should this occur:

The Board and Management realize how unfair this may be but the simple truth is that if we don’t have cash in the operating account, we can’t pay operating bills.

If you pay your maintenance on time each month, you have our respect and gratitude. If you miss on occasion and get caught up again the next month, we understand. However, if you are chronically late, you are placing an unacceptable burden on your neighbors and hurting your own financial condition (up to and including unnecessary legal charges and potential loss of your investment).

One of the strengths of a housing cooperative is the ability to work together to achieve goals none of us could accomplish on our own. The minimum requirement in working together is taking responsibility to pay shareholder charges timely. In that light, we encourage those of you in financial difficulty to schedule a payment plan with management. Taking this action early could save the late shareholder unnecessary legal fees. Late shareholders and shareholders with payment plans will still have to pay late interest. Management does not have the authority to forgive charges on shareholder bills.

Finally, our bank loan covenant with Amalgamated Bank gives the bank the right to impose a maintenance increase should collections fall behind certain levels. We are already below this threshold. While I can’t tell you what the bank may decide, I can tell you that we have until 12/31/2009 to increase our cash collections ourselves before they become aware of arrearage levels.

Please make every effort to pay your monthly charges by the 15th of each month.

Sincerely,

Stephen Vernon, President
On behalf of the Nagle Apartments Corp. Board of Directors and Management