Switching to water-metering can benefit co-op, condo buildings.

Cooperative and condominium buildings in New York City that switch to a metered rate from the current flat-rate frontage system have an excellent chance of saving substantial amounts of money, according to Mitchell Barry, chief executive officer of Century Operating Corporation.

The New York-based property management firm has been actively involved in six conversions of condominiums and cooperative buildings which it manages throughout the City. And in most cases, the switch to metering in their buildings, sometimes also combined with moderate water conservation, has ultimately led to savings.

According to Barry, the New York City Department of Environmental Protection (DEP) will abandon its flat-rate frontage system of water charge assessment by year-end 1998 for all buildings, including residential properties. "The city is mandating the switch to new metered systems that assess water bills based on actual usage," he said. "The program is designed to encourage water conservation and to ease the burden on sewage treatment plants within the five boroughs."

"The City has extended its 'Window of Opportunity' program, which offers a rebate that typically covers 70 to 100 percent of the conversion costs for properties that make the change to metering before the mandate," Barry continued. "While many property owners and shareholders are concerned that their water bills will increase, in reality, many buildings can expect to break even or decrease their water bills with the change-over. The key is knowing what the water bill for a property should be, which can help boards better prepare for the costs of metering."

Century is working with buildings across the City to assess what their "normal" usage should be and how much water and sewer costs should amount to over the course of a year on the metered system. "Normal" estimated usage is dependent on each particular property's specific demographic and physical characteristics. The results of these analyses have enabled property managers to better plan for a conversion.

"Many buildings decide to immediately change over to metered rates after the analysis of 'normal' usage to take advantage of the City's incentive program," Barry noted. "In some cases, we have discovered such issues as possible leakages or erroneous billing practices."

For example, Century provided an evaluation for a luxury cooperative building on East 18th Street which revealed that switching from frontage to metering, in conjunction with other water saving measures, would produce significant savings.

"The City's estimate of the property's water usage was inaccurate," explained Coop Board President Steve Hanson. "We recouped the costs to install a metered system within the first year, and, as a result, we did not have to increase our maintenance fees. Century was very instrumental in helping to protect our shareholders' interests. We look forward to continued savings in the coming years."

In some cases, Century recommends that a building wait until the deadline to go on a metered rate, but should take steps now to offset and perhaps turn around anticipated increases.

Other measures toward water conservation may include a retrofit in favor of water-saving toilets, showerheads and faucets. "Building owners have noted that even minor adjustments, such as the addition of aerators, to their equipment have often precluded the need to replace the equipment altogether and have resulted in cost savings," Barry noted.

Century Operating Corporation is a leading property management firm specializing in cooperative and condominium management in the New York Metropolitan area. It has a growing portfolio which currently includes more than 60 buildings and approximately 8,000 residential units. Its services incorporate a wide spectrum o f management functions including cooperative and condominium management, asset management, co-op/condo closings, mortgage finance, insurance services, and construction management.