The following is a reproduction of a memo sent on 14 January 2012 to all shareholders by our co-op’s certified public accountants: Prisand, Mellina, Unterlack & Co., LLP.

(Download the scanned memo [PDF, 44KB].)

TO: Shareholders of NAGLE APARTMENTS CORP.

RE: PERSONAL INCOME TAX RETURN DATA FOR 2010

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 2011 your Per Share individual income tax deductions are as follows:

MORTGAGE INTEREST $11.9667 per share

REAL ESTATE TAX $18.5913 per share

For the year 2011, 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 2011, 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 2011, 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 2011 was $19.6252 per share for mortgage amortization. This is not a deduction, but an increase in the basis of your investment.

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

On Saturday 3 December 2011, the Board of Directors met to review the operating budget for 2012. The following is a reproduction of the follow-up letter sent on 14 December 2011 to all shareholders.

[PDF version]

Maintenance Fees, Assessment and House Rules Changes for 2012

Dear Shareholders,

Maintenance Charges for 2012

The corporation’s cash needs for operations have improved slightly due to savings on water bills, anticipated savings on heat and repairs. The savings on heat and repairs are the direct result of the roof replacement project that is nearing completion. These savings have been used to fund anticipated increases in staff union charges, real estate taxes and other items.

As a result, there is no maintenance increase for 2012: the charge remains at $6.20 per share per month.

Assessment

Two major building capital replacements and improvements have been completed without requiring additional funds in the form of an assessment from shareholders. This was possible because the corporation owned several rental units which, when sold, is funding or funded capital repairs such as the new windows and the new roofs. We now have only six units left and cannot solely depend on the sale of those units to fund new capital projects.

At the last annual meeting, the Board asked shareholders to vote for a Capital Fund fee to be applied on the sale of units (also known as a “flip tax” or “transfer tax”). The vote to approve that proposal has failed and now the corporation has one less method at its disposal to obtain necessary capital repair funds.

We have two large capital repairs coming up shortly — the roof over the garage and the garage itself. To prepare for those large expenditures, the Board voted to impose an assessment of $0.155 per share (or $0.16 per share, rounded) per month to be paid with the monthly maintenance. This is approximately 2.5% of the current maintenance and it will be used to fund capital projects.

This small assessment will fund only a portion of the upcoming necessary capital repairs and discretionary improvements. Any additional amounts will likely come from additional assessments, sale of rental apartments or loans. The assessment will start with the January bills and it has no end date.

Additionally, the Federal Corporations that guarantee mortgages have imposed rules regarding reserve funding. Housing associations now must have a reserve funding line in their operating budget for 10% of their revenues in order to approve mortgages for purchasers of co-ops and condos. In order to ensure that prospective buyers of apartments can obtain mortgages, we need to make sure that we comply. Although this requirement is being imposed from outside the corporation, it is a smart policy and well within our financial plans.

Other Changes – Sublets

The Board voted to decrease sublet fees for shareholders not currently subletting from $25 per share for all years to $15 per share for the first year, and $25 per share for the second year. Shareholders who are already subletting will be grandfathered into the current fee structure. The Board also voted to rescind the temporary third year out of every six years increase to the sublet limit back to the original policy of two years out of six years for shareholders newly subletting. Shareholders currently subletting are grandfathered into the three-year plan.

Other Changes – Deposit on Sale of Shares

Last year, the Board imposed a deposit on sale of shares sufficient to cover electric charges which are billed in arrears. The Board wishes to inform al shareholders that the amount of the deposit is $250. Any remaining amount after the electric charges have been fully billed will be refunded by the management company to the former shareholder.

Other Changes – Storage and Bike Storage

Additional storage and bike storage will become available in the next few months. Please contact Justin Verret 914-524-8600 (jverret[at]bluewoodsmgmt.com) if you want to be placed on the lists.

Staff Holiday Tips

If you want to give holiday tips to the superintendent or porters, please do so directly:

• Shahabudeen “Sha” Hayatt – since 1996
• Andres Mangual – since 2008
• Narine “Ricky” Deolaal – since 2008

Building Security

Management and the Board wished to remind everyone that the doors are meant to let you in and keep unwanted individuals out. Forcing the door open without a key or propping the door open compromise building security and resident security. If you need extra keys, please contact the superintendent or the building manager.

The following is a reproduction of a memo sent on 10 January 2011 to all shareholders by our co-op’s certified public accountants: Prisand, Mellina, Unterlack & Co., LLP.

(Download the scanned memo [PDF, 43KB].)

TO: Shareholders of NAGLE APARTMENTS CORP.

RE: PERSONAL INCOME TAX RETURN DATA FOR 2010

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 2010 your Per Share individual income tax deductions are as follows:

MORTGAGE INTEREST $12.9367 per share

REAL ESTATE TAX $17.5523 per share

For the year 2010, 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 2010, 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 2010, 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 2010 was $18.9792 per share for mortgage amortization. This is not a deduction, but an increase in the basis of your investment.

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 17 December 2010 to all shareholders.

Dear Shareholders,

On Saturday, December 4, 2010, the Board met to review the operating budget for 2011. The corporation continues to be under cost pressure from a variety of sources, including real estate taxes, water/sewer rates, utility costs and building maintenance costs. Most of these are out of our collective control.

Changes for 2011

At the meeting, the Board voted to:

1. Raise monthly maintenance charges $0.15 per share or 2.48% (there was no increase last year);
2. Raise laundry charges $0.25 per load wash and dry;
3. Upon sale, require a $250 utility deposit from the seller, the balance of which will be refunded to the seller after the unit’s utility charges have been fully posted to their account (usually after two months);
4. Consistent with the last several years, the Board voted not to assess the co-op/condo and Star credits and abatements. Those of you who had previously signed up for these will continue to receive them January–June.

Other News

The Board and management are working with Rand Engineering to bid out needed and necessary roof replacement work (for the roofs of the residential buildings). We hope to begin in the first half of 2011. This is likely to be very comprehensive work with a twenty-year warranty and includes bringing several items up to code.

As a result of the engineering study done to prepare us for the roof repairs, it was discovered that the building roof s lack the necessary strength to support a “green roof” and lack the strength to support a continuous human presence (like a patio). However, the Board is reviewing other options to use the space to better the environment. A leading contender at the moment is a solar electric configuration.

Happy Holidays,

—Your Board of Directors and Management

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