The Hidden Alteration Risk That Could Bankrupt Your Building

When an Upper East Side co-op’s gas pipes failed Local Law 152 inspection and service was immediately shut off, what happened next could have cost over half a million dollars. Instead, smart planning kept repairs under $200,000, and engineering expert Peter Varsalona, principal at Rand Engineering and Architecture, reveals the step-by-step strategy that saved this building from disaster. Learn why testing gas systems in sections was crucial and how individual apartment meters created unexpected complications. Discover why waiting for the mandatory four-year inspection is a costly mistake, learn specific alteration agreement language that protects your building from shareholder-caused gas shutdowns, and understand when converting to electric makes financial sense. This real-world case study could save your building hundreds of thousands of dollars and months of resident disruption. Habitat's Carol Ott conducts the interview. 

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Transcript

Emily Myers: Welcome to Problem Solved, a conversation about challenges facing New York co-op and condo board directors. I'm Emily Myers with Habitat Magazine and I'm joined by Peter Varsalona, principal at Rand Engineering and Architecture. Peter, great to have you. 

Peter Varsalona: Great to be talking to you this morning. 

Emily Myers: So we're gonna talk about a dreaded scenario for co-op and condo boards: the gas being shut off.

We'll discuss why it's so important to have a good idea of the condition of your gas piping and how all this intersects with alterations, something boards frequently have to weigh in on. So let's kick off our conversation with a look at a 10 story co-op on the Upper East Side that had to deal with a gas shutdown.

Peter, can you explain what happened? 

Peter Varsalona: So in 2023, this particular co-op had its Local Law 152 gas inspection. It's required every four years for building owners who have gas piping. And unfortunately, they failed and leaks were found on the overhead mains located within the cellar. So the system had to be shut down, and that's where the real scariness, right, can occur.

Because now in order to reestablish service, you have to pass a full system pressure test, and that's where it gets difficult. Because this building was built in 1912, the piping is quite old and fittings can loosen up over time and it can be very challenging to pass that actual test. 

Emily Myers: So imagine the board was also concerned about the scope of the repairs.

Peter Varsalona: Absolutely. These type of programs could really skyrocket, if you had to replace the mains, rises, and branches, which some owners have been faced with after shutdowns, you're talking well over half a million dollars. And the shutdown could be a considerable period of time, so they really needed a solution that was one, economical, two, expedient and three, done in a way that doesn't tear up their apartments. So there was a lot of fear involved. 

Emily Myers: And so did the gas system that was affected, was it a heating and utilities or simply utilities? 

Peter Varsalona: This happened to be utilities. Years ago, this particular co-op had converted its heating plant to gas operation.

So they were fed from a different service. So we were dealing only with the domestic service that affects the stoves, maybe gas dryers in apartments, and the laundry room. 

Emily Myers: Okay, so that's one saving grace. So what were the steps then required to restore gas to the building? 

Peter Varsalona: We had to come up with a plan of testing that could work for them.

And the best way to look at it is to break systems down. And what we did is we looked at it in terms of mains, that's the overhead piping throughout the cellar, the risers, the vertical piping that runs through the building. And then the branch lines, the horizontals that feed. Into the apartments. This particular building had an extra challenge where the gas meters were actually located inside the apartments.

So that was another wrinkle that we had to deal with, with regard to how to possibly restore the gas service as quickly as possible. 

Emily Myers: And why was that a problem to have the gas meters in the apartments? 

Peter Varsalona: So ConEdison has a lot of different rules now as it relates to gas meters in apartments.

They only want 'em at certain heights. They can't be enclosed in cabinets, in millwork. They can't be unvented enclosures. And of course, in older pre-war buildings, the meters tend to be very high, near the ceilings, sometimes they're buried in construction, and those all have to be corrected. The utility's not gonna restore gas service with those conditions in place.

So this particular co-op made the decision that, based on the amount of gas used in apartments, and the typical bills they would otherwise get, that it would make sense for them to convert to a master metered system. So they basically removed all these individual meters and set up a master meter in the cellar.

Emily Myers: Okay. And you said your strategy was to break the gas pipe system into different parts. Is that easy to do? 

Peter Varsalona: So it's not easy, but it's pretty common. The really critical item is to see if the risers hold. Because the means you have pretty much free access in the cellar.

Usually it's exposed piping and it's fairly easy to get to and replace. The risers on the other hand, are much more challenging. They're usually run inside concealed chases through apartments. This particular building had doctor's offices on the ground floor, so those would be impacted. And with renovations, often to get to the riser chase alone is quite difficult.

You're breaking through things to access the piping. So if we could get the risers to hold pressure, we would be in a much better situation. 'Cause then we're talking about individual branch lines and apartments, and since I was already dropping the meters, I could more readily test those branch lines, and if I had to repair or replace one, it would be a lot easier than if I had to replace the risers.

Emily Myers: Okay. So the advantage of repairings in sections is that you can test in sections and perhaps you can isolate areas where there are vulnerabilities in the system. 

Peter Varsalona: Absolutely. So by testing those individual components, you can then quickly determine your scope of work. And we were quite fortunate in this case where four of the five risers held and the one riser that didn't hold, we were able to then isolate that section of piping and find where the leaking fitting was.

And then we were able to reestablish those lines as being sound and passing a prescribed pressure test, so then we could change our focus to the branches in the apartments. We already knew we had to replace the mains in the basement from the original inspection, so it was really about, what more do I have to do inside the apartments?

Emily Myers: Okay. And we obviously have Local Law 97 and a push to remove fossil fuels from our systems. Was that part of a conversation with the board, bearing in mind that, the Local Law 152 pressure tests are going to expose vulnerabilities within these systems? 

Peter Varsalona: It'd be very difficult if you come back after doing this kind of restoration work, which is not insignificant, and then having to test again in four years or if you find other issues.

So we are looking at a comprehensive repair, or potentially converting the domestic system to electric, right? So now, there's a whole nother issues with associated with electric conversions. You have to obviously switch out the gas stove to an electric stove. You would have to run power to that stove, usually from the apartment load center or panel.

Many times that panel is inadequate, doesn't have enough power to feed a dedicated 30 or 40 amp two pole circuit for that particular appliance. So you would have to upgrade the riser, the feeder from the basement going up into the apartment. That alone is pretty significant work and often, really is much more than the gas repair that we're talking about.

And then at the end of the day, are you really happy with an electric stove? 

Emily Myers: Did any of the residents decide to take that route? 

Peter Varsalona: Absolutely. Several did. Several were not willing to wait the length of time, where they would be without having cooking inside the apartment from a stove.

Many owners just, they use microwaves. They use cook plates that they can connect to a local outlet. Or order out, right? They get through it. Others were unwilling to do so and thought, Hey, this is a good opportunity for me if I had an old stove and I really wanted to switch to an induction type stove, and they had the power in their apartment panel and they chose to put in an electric stove.

Emily Myers: So what was the cost to the building then for the gas pipe repairs that you did? 

Peter Varsalona: The cost came in around $200,000. So it was significantly less than if they had to replace all of the piping. So they were very glad about that. Also, the work in the apartments was quite limited. We only had, based on testing and repairs, a handful of apartments that required maybe more significant repair to their branches.

And that was very good. It's one thing to lose service, it's another thing to have active construction inside your kitchen or perhaps your laundry room or closet where your dryer is if you have it on gas. And that can be again, especially if you've already invested money in upgrading your apartment and to have to open those areas up, can be quite challenging and expensive.

We were pretty fortunate in this case. 

Emily Myers: So what can buildings do to avoid these kinds of scenarios? 

Peter Varsalona: Again, one of the things is to not necessarily wait for the four year inspection on exposed gas piping. One of the things that you want to do is you want to have a kind of a proactive approach to inspection, and if you see things that are concerning to you or require repair, you can discuss it with your house plumber or you can review with an engineer what can be done. 

 When it's an emergency situation, when the gas is shut off, it's too late, right? The emergency has happened, it's gonna be more expensive for you. But if you can control what's being done, and you see conditions, often you can bypass around a defective section of piping.

You can put in temporary service, or they have these large bottles, they would connect to provide or maintain pressure in a system while a section is replaced or repaired. You wanna make sure that localized valves are in good condition, they're labeled so everybody knows what feeds what, and that they're in good operating condition.

And if you need to, you add it to your capital plan. And then of course, you also wanna make sure that you limit alterations to this piping, right? Because if you have a system, let's say it's common risers that feed a particular line, you wanna be very careful about shareholder alterations that could impact that service to other apartments.

We've been involved in cases where co-ops allowed kitchen remodels and the contractor did damage, or the piping failed in the apartment and the service had to be shut down to the whole building. There was no way to isolate it. And then they were out gas service for 18 months and had to do all the same amount of testing and restoration and repair to that system.

So you have to be very careful about allowing shareholder alterations, particularly with gas piping systems. 

Emily Myers: Are there specific changes to the alteration agreements that you would recommend in terms of the wording when it comes to gas appliances? 

Peter Varsalona: Absolutely. One of the things is don't allow it.

It's not allowed. There can be special cases, certainly. And those could be outlined. You would want this evaluated by your licensed master plumber that the co-op uses, it's consulting architect or engineer. What could be done whereby the existing system stays in place and you're simply amending from the available local valve that's in the apartment and not altering the rest of the system.

Again, once you have to shut down parts of the system or risers, particularly if it's a common riser, it becomes very tricky for you. You have to test it to make sure it's operational and if it doesn't pass. It leads to a whole nother series of tough decisions that have to be made. So if you can isolate that apartment and have them work on their side of the valve or meter where it's not affecting other services, it's a lot easier.

Well, let's say apartments have individual gas risers, so you're not really affecting other apartment owners. The problem with that is the way they were often designed is all the little individual gas lines for a particular apartment line are all bundled together. So if you fail, your pressure test on your line, you have no access to that piping anyway.

So you gotta run a new line and where are you gonna run it? It almost forces owners in those situations to strongly consider electric at that point, because it's really difficult. If you're on a upper floor, how are you gonna get that gas riser up there? So again, it's, beware of alterations that deal with gas pipe. Particularly in older construction, they have a more propensity to fail.

Emily Myers: Goodness. So takeaways are to establish the condition of the gas system and also just be very careful about gas pipe alterations by shareholders or unit owners. 

Peter Varsalona: Absolutely. 

Emily Myers: Peter. Fantastic advice there. Thank you so much. 

Peter Varsalona: Thank you very much. 

Emily Myers: Peter Varsalona, principal at Rand Engineering and Architecture.