This co-op in the Bronx owes thousands of dollars to former tenants

NEW YORK -- The Amalgamated Housing Cooperative in the Bronx owes thousands of dollars to dozens of former tenants.

It is the oldest nonprofit housing cooperative in the United States and was once praised by then-governor Franklin Delano Roosevelt as a success story, but CBS New York investigative reporter Tim McNicholas is uncovering the historic property's financial woes.

Refunds from Amalgamated Housing Cooperative in limbo

The Amalgamated Housing Co-op uses a model in which residents purchase a share in the development when they move in. They're supposed to get their investment back when they move out, but CBS New York Investigates has learned 34 people who moved out last year are still owed refunds.

Tracy Arce's late father lived in the co-op, and she says when she started sorting out the money he left behind, she learned the co-op owes the family $28,000. It's money she's still fighting for more than a year after her father's death.

"On top of all the other stress you have and the grief you have of a parent dying, closing out the affairs, they added so much unnecessary stress," Arce said.

"How would your dad feel about this?" McNicholas asked.

"He would be in disbelief. He really would because he knew the employees. He just wouldn't believe it," Arce said.

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Amalgamated Housing Cooperative's management responds to owed refunds

General manager Charles Zsebedics says the delays stem from the pandemic and the struggles getting apartments ready and moving new tenants in.

"So when you have more incoming than outgoing, that money sits there and is waiting to pay out shareholders, but the reverse is true here. There are more vacating than there are incoming," he said.

"Should there be an escrow or some kind of emergency fund?" McNicholas asked.

"Yeah, I think so," Zsebedics said.

But for now, there is no such fund. Zsebedics says the average refund ranges between $25,000-$30,000 depending on the size of the apartment vacated and the duration of the residency.

"Have you been getting an earful from these people [who are owed refunds] or--?" McNicholas asked.

"Yeah, I mean, of course," Zsebedics said.

Zsebedics says he plans on adding staff to help get more apartments move-in ready.

The state of New York tells CBS New York its "role is limited" since the property isn't public, and it's up to the co-op's board "to ensure the housing company's funds are appropriately expended."

"I believe there is a crisis within affordable housing. We're just one of many that are having some difficulties," Zsebedics said.

Zsebedics says he's confident everyone will eventually get their money.

Arce hopes he's right, so she can sort out her dad's finances and put an end to a painful chapter in her life.

"I don't understand. It's a year later-- over a year later," she said.

CBS New York's investigative team also spoke with a co-op board member who says they have submitted an application with the state to increase their rent. They hope the move will help their finances and are now waiting for the state to decide.

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