What is a special assessment?
A special assessment is a one-time charge that a condo or co-op board collects from owners to cover a significant expense that isn’t included in the building’s regular operating budget.
It’s often used for large, unplanned costs such as major roof repairs after storm damage, emergency boiler replacement, or urgent façade work to meet Local Law 11. Assessments can also fund planned improvements when reserves or monthly fees aren’t enough to cover the bill.
Why boards levy special assessments
Boards turn to special assessments for a few key reasons:
- Unexpected emergencies such as flood damage, structural issues, or equipment failures
- Capital projects without enough reserves including elevator modernization, lobby renovations, or roof replacement
- Compliance with new laws like emissions upgrades for Local Law 97, safety systems, or accessibility requirements
- Inflation-driven cost spikes when project costs exceed earlier estimates
With a well-funded reserve, your building can often cover these costs without adding to residents’ financial stress. But many NYC buildings struggle to keep reserves at healthy levels, which is why assessments are fairly common. Sometimes the need comes sooner than expected — for example, a roof replacement planned for 2030 may become urgent after a severe storm. Without the funds ready, the board might have to issue a special assessment so the work can happen immediately, keeping the building watertight and preventing further damage.
How special assessments are calculated
Every building has its own formula, but most assessments are allocated the same way as monthly fees:
- Co-ops: Based on the number of shares you own
- Condos: Based on your unit’s percentage of common interest
Boards determine the total project cost, subtract any reserve funds they’ll use, and divide the remainder according to this formula. The charge may be due as a lump sum or spread over several months, depending on the size of the expense and the board’s decision.
Can boards avoid them?
Not always, but smart planning makes them less likely. Healthy reserves, funded consistently through the budget, act as a cushion for big expenses. That’s why we recommend boards review their reserve fund strategy every few years.
Another approach is implementing a capital contribution fee for new owners, which can steadily build reserves without increasing monthly fees for everyone. When boards commit to these strategies, they’re far less likely to surprise residents with an unplanned charge.
Communicating assessments to residents
Even if an assessment is necessary, it can still cause frustration — especially if it comes without warning. Clear, early communication helps. Boards should explain why the assessment is needed, how the cost was calculated, what it will pay for, and when payments are due.
For tips on making those conversations easier, see our guide to communicating special assessments effectively.
The takeaway
Special assessments aren’t anyone’s favorite, but they play an important role in keeping your property safe, compliant, and well-maintained.
When boards plan ahead, maintain healthy reserves, and communicate openly, assessments become less frequent and less stressful for everyone involved.
