City Issues Proposed Rules on Complying With Local Law 97

The city’s Department of Buildings (DOB) has come out with long-awaited draft regulations on how building owners, including co-op and condo boards, can cut their buildings’ carbon emissions to comply with Local Law 97 of the Climate Mobilization Act. 

The new draft regulations seek to clarify how owners of buildings larger than 25,000 square feet can calculate their property’s level of annual carbon emissions, and how the carbon caps apply to specific building uses. Buildings that fail to meet the caps will face stiff fines, beginning in 2024.

The DOB will conduct a public hearing on the draft regulations at 11 a.m. on Nov. 14. An Advisory Group — composed of architects, engineers, property owners, representatives from the business sector and public utilities, environmental justice advocates and tenant advocates — will submit its final recommendations to the city council by Jan. 1, 2023.

Working Groups composed of more than 100 stakeholders met hundreds of times to prepare the draft regulations. Ed Yaker, treasurer at the Amalgamated Housing Cooperative in the Bronx, served on the Multifamily Working Group, and he was particularly impressed by two outcomes: the DOB’s willingness to compromise on fines, and the inclusion of “time-of-use” in the calculation of building emissions. Under the latter, buildings that reduce energy consumption during times of peak demand — through solar panels, storage batteries, cogen plants or other strategies — would be rewarded.

“That’s something that was not in the original bill, and now it’s in the proposed regs,” Yaker says. “And that’s a good thing. So is the city’s statement that they don’t want our money, they want our greenhouse gas emissions.”

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Mary Ann Rothman, executive director of the Council of New York Cooperatives & Condominiums, served with Yaker on the Multifamily Working Group. “Ed’s right that the time-of-use provision will help bend the curve,” she says. “And if buildings show a good faith effort to comply with the law, there will be mitigation of fines. That’s terrific.”

Another positive development, in Rothman’s view, is that the original 10 occupancy-use groups have been expanded to include all 61 occupancy-use groups in the Energy Star program. “Now,” Rothman says, “they’re trying to deal with the enormous variety of buildings in this city,” including everything from high-rise Manhattan co-ops to low-density garden apartments in the outer boroughs.

A team of lawyers at Stroock & Stroock & Lavan echoed the sentiment in a client advisory: “The expansion of occupancy-use groups…will allow building owners to calculate their building greenhouse gas emissions limits more in line with the building’s actual uses and energy needs, and will lead to a fairer, more representative emissions limit.”

One area of lingering uncertainty is how the city will regulate the use of renewable energy credits generated from solar and wind projects, which can be used to offset a building’s emissions caused by utility-supplied electricity. (The city currently draws the bulk of its electricity from fossil fuels.) The proposed rules do not limit the use of credits but imply that a cap will be imposed through future rule making.

Of course the draft regulations have sparked some criticism. “This law is single-handedly changing how buildings have been running for at least 100 years,” Jay Martin, executive director of the Community Housing Improvement Program, a landlord and managers group, tells Crain’s. “We're willing to participate, but I think we’re closer to the beginning of this process than the end.”

To read the draft regulations, click here. 

To register to attend the virtual public hearing on Nov. 14 at 11 a.m., click here.

To submit comments online before Nov. 14, click here.

To see the 338-page list of buildings that must comply with Local Law 97, click here.