Ever open your LIC condo statement and wonder why you pay common charges every month, then suddenly see a special assessment on top? You are not alone. Understanding what each fee covers helps you budget smarter, compare buildings fairly, and avoid surprises. In this guide, you will learn what common charges, reserve contributions, and assessments mean in Long Island City condos, how they show up in offering plans and financials, and the right questions to ask before you buy or sell. Let’s dive in.
Common charges explained
Common charges are the recurring fees you pay to your condominium association for day-to-day operations and upkeep of the building’s shared elements. In LIC, this often includes building staff, common-area utilities, insurance for common elements, elevator service, management fees, routine repairs, cleaning, landscaping, snow removal, and amenity maintenance.
Most New York condos bill common charges monthly. Your share is typically based on your unit’s percentage interest set in the declaration or bylaws. Larger units usually pay a higher share than smaller ones because they hold a greater percentage interest.
Reserve contributions within common charges
A portion of the operating budget is often allocated to capital reserves. These reserve contributions set money aside for big-ticket items such as roofs, boilers, chiller plants, elevators, facade work, and mechanical systems. Adequate reserves help reduce the need for large assessments when major work comes due.
There is no universal statutory minimum reserve level in New York. Adequacy depends on the building’s capital plan and reserve study. Still, if you see very low reserves relative to the annual budget, it is worth asking how future projects will be funded.
Utilities and how they are billed
In some LIC high-rises, utilities are master-metered. That means heat, hot water, or certain electricity costs for building systems may be paid from common charges. In other buildings, utilities are submetered or billed directly to owners. Clarify what your common charges include so you can compare apples to apples across buildings.
What is a special assessment
A special assessment is an additional charge to owners when the regular operating budget and reserves are not enough to cover an expense. Boards may levy assessments for unexpected repairs, capital projects that exceed reserves, insurance deductibles after a claim, or cost spikes that the budget did not anticipate.
Assessments can be a one-time lump sum or spread across several months or years, depending on the bylaws and board decisions. Some associations may also borrow from a bank to fund capital projects. In that case, you might see an assessment designed to repay loan costs over time.
Board authority and collection
Under New York’s condominium framework, including Real Property Law Article 9-B, the declaration and bylaws set how common charges and assessments are levied, the approvals required, and collection remedies. If owners do not pay, associations can place a lien and may commence foreclosure if the debt is not cured, subject to governing documents and law. Review your building’s bylaws for any caps on assessments or vote thresholds for large projects or borrowing.
Where to find the numbers
How these items appear depends on whether you are reviewing a new-construction offering plan or an existing building’s financials.
In the offering plan
If you are buying in a new LIC condo or from a sponsor, the offering plan filed with the New York State Attorney General includes:
- Pro forma operating budget with line items that roll up to a projected monthly common charge per unit.
- Reserve funding disclosures that show planned contributions and any developer practices or waivers.
- Tax information, including any abatements or PILOT programs and their expected expiration dates.
- Material contracts such as management agreements and known service contracts.
Pay close attention to any tax abatement timeline. When an abatement expires, taxes can rise, which may affect your overall monthly housing cost even if common charges stay flat.
In financial statements for existing buildings
When you review an established building, focus on these items:
- Operating statement that shows common charge receipts and major expenses like salaries, insurance, utilities, repairs, and management fees.
- Budget versus actual results for the current and prior years to see if the association is running a surplus or deficit.
- Reserve fund balance and activity that show contributions and spending on capital projects.
- Notes that disclose pending assessments, loans, litigation, or deferred maintenance.
- Accounts receivable that reveal owner delinquency and collection history.
- Any reserve study or capital plan that outlines near-term and long-term replacement needs.
If there is borrowing secured by common elements or repeated draws from reserves with no replenishment plan, ask how the board expects to stabilize funding.
Budgeting tips and quick math
You can run simple checks to gauge the health of a building and your potential exposure.
Convert budgets to monthly costs
- Example: If the annual operating budget is 2,400,000 dollars and there are 100 units with equal shares, the average annual common charge per unit is 24,000 dollars, or about 2,000 dollars per month. Most condos allocate by percentage interest, so your share may be higher or lower.
Quick reserve adequacy check
There is no one-size-fits-all ratio, but a quick screen can help you know what to ask:
- Very low reserves: Less than 5 percent of the annual operating budget. High concern for near-term assessments unless a capital plan explains otherwise.
- Moderate: About 5 to 15 percent. May be acceptable for newer buildings with limited near-term capital needs.
- Higher: Above 15 to 25 percent or more. Often indicates stronger funding, but actual needs depend on systems and age.
In LIC, newer high-amenity towers have expensive systems to maintain and replace. A newer building with a pool, large fitness center, and multiple elevators will generally require a more robust reserve plan than a smaller, low-amenity condo.
Assessment scenario example
If a roof replacement costs 300,000 dollars and the reserve balance is 50,000 dollars, the shortfall is 250,000 dollars. In a 100-unit building with equal shares, a one-time assessment would be 2,500 dollars per unit. If the board chooses to spread it over two years, that equals about 1,250 dollars per year per unit. Your actual share follows your percentage interest unless the bylaws specify another method.
Personal budgeting guideline
When you budget for a unit purchase, consider adding a 5 to 10 percent cushion on top of the stated monthly common charges to cover routine increases or minor surprises. If you see red flags such as low reserves or major upcoming projects, increase that cushion.
LIC red flags to watch
Long Island City includes many newer high-rise condos with modern amenities. That can be great for lifestyle and resale, but it also means higher ongoing costs. Keep an eye out for:
- Low reserves or repeated reserve draws without a funding plan.
- A history of frequent special assessments in financials or board minutes.
- High owner delinquency that shows up in accounts receivable.
- Expiring tax abatements or PILOT agreements that may increase costs when they end.
- Deferred maintenance or outstanding violations for facades, elevators, or mechanical systems.
- Short-term debt taken to cover operating deficits.
- Large amenities with a small owner base that increase per-unit costs.
- Pending litigation or large insurance deductibles that could lead to assessments after a claim.
Questions to ask before you buy
Ask these during diligence for a resale or sponsor unit in LIC:
- What is the current reserve fund balance, and when was the last reserve study updated?
- What capital projects are planned in the next 1 to 5 years, and how will they be funded?
- Have there been special assessments in the past 5 years? For what amounts and reasons?
- Are there outstanding violations or engineering findings that could trigger future work?
- Are any developer credits or temporary budget waivers in place? When do they expire?
- Are there any tax abatements or PILOT programs, and when do they end?
- How are utilities billed, and which utilities are included in common charges?
- What is the collection policy, and how many units are currently delinquent?
- Has the association borrowed recently, and what are the loan terms?
- Do bylaws limit assessments or require owner approval above certain thresholds?
Documents to request
For an existing LIC condo, request:
- The latest annual budget and the last 3 years of budgets and actuals.
- Most recent audited or reviewed financial statements, plus year-to-date management statements.
- Reserve study and a schedule of capital projects with a history of reserve spending.
- Board meeting minutes for the past 12 to 24 months.
- The offering plan, declaration, bylaws, and house rules.
- A list of loans and any encumbrances on common elements.
- Insurance policy summary, including master policy deductible and coverage types.
- Current arrears schedule and collection policy.
- Any engineering or inspection reports for facade, elevators, or mechanicals.
How to compare two LIC condos
Use a simple side-by-side check to narrow your risk and total monthly cost:
- Monthly common charges per square foot and what they include.
- Reserve balance as a percent of the annual operating budget and whether a recent reserve study exists.
- Known capital projects and their funding source.
- Assessment history and whether any are pending.
- Tax abatement status and expiration date.
- Amenities and staffing level relative to building size.
- Owner delinquency level and any recent borrowing.
Bottom line for LIC buyers and owners
Common charges fund everyday operations and planned reserve contributions. Assessments fill gaps when big projects or unexpected costs arise. In Long Island City, newer high-amenity buildings can carry higher operating costs, and expiring abatements can change your monthly picture. If you review the offering plan, financial statements, reserve data, and board minutes, you can spot risks early and plan with confidence.
If you want help reviewing a specific building’s numbers or preparing for a board interview, reach out for a second opinion from a local advisor who reads these documents every week. Schedule a consultation with Unknown Company to talk through your goals and next steps in LIC.
FAQs
What do common charges cover in LIC condos
- Common charges cover building operations like staff, insurance for common elements, utilities for common areas, elevator service, management fees, routine repairs, and amenity upkeep.
How are reserve contributions different from assessments
- Reserve contributions are planned savings within the operating budget for future capital work, while assessments are extra charges when reserves and the budget are not enough for a specific need.
Why do some LIC buildings have higher common charges
- Larger amenities and staffing, master-metered utilities, and robust reserve funding increase operating costs, which can raise common charges.
How can I tell if an assessment is likely soon
- Look for low reserves, a list of near-term capital projects, prior assessments in minutes, owner delinquencies, and expiring tax abatements or loans coming due.
Where do I find common charges and assessment details before I buy
- Check the offering plan for the pro forma budget and reserve disclosures, and review recent financials, budgets, minutes, and any reserve study for existing buildings.
Can a condo board place a lien if I do not pay charges
- Yes. Under New York condominium law and your building’s governing documents, associations can lien units for unpaid common charges and assessments and may pursue foreclosure if not cured.
How should I budget for increases or surprises
- Add a 5 to 10 percent cushion to current common charges, and adjust higher if red flags suggest upcoming projects or reserve shortfalls.
