City Pushes Back Against Bid to Water Down Fines for Local Law 97

Terrified by the potential costs of complying with Local Law 97, which requires owners to reduce their buildings' carbon emissions or face stiff fines, co-op and condo boards in the outer boroughs aired their fears to elected officials. They got a warm reception from City Councilmember Linda Lee (D-Queens).

Lee has introduced a bill, Intro. 772, that would would allow co-ops and condos to count gardens and other green spaces as part of their square footage when calculating their buildings' carbon emissions limits. The change would increase the amount of carbon those buildings are allowed to emit and thus reduce the cost of of carbon-cutting retrofits to comply with the law. Intro. 772, which would affect about 10% of the 50,000 buildings covered by Local Law 97, has strong backing among other members of the city council.

In addition to changing the square-footage calculations, Intro. 772 would exempt buildings with an average per-unit assessed value of $65,000 or less from fines between the years 2030 and 2035; and it would halve fines for those buildings between 2036 and 2040, and slash them to 25% from 2041 through 2045. Lee’s bill would also require the Department of Buildings to consider adjusting emissions limits for co-ops and condos if they’ve taken certain steps to reduce their carbon footprints, such as converting from oil to gas or installing solar panels.

There is also strong dissent to Intro. 772. Rohit Aggarwala, commissioner of the city's Department of Environmental Protection, called Lee's proposal “absolutely wrong.” He tells Crain's: “Buildings are the largest source of emissions in the city, and people who own real estate have got to recognize that part of their responsibility as owners is reducing the impact they have on the climate. And you know, frankly, I think it's laziness to just say, 'Oh, exempt us. We don't want to be bothered" — as opposed to actually solving this problem, because we have a way to do so.”

Observers note that buildings that can’t afford the costly upgrades will struggle to comply, or might even decide that paying the fines would be cheaper than compliance. “So those are real problems that need to be addressed,” says Eli Dvorkin, editorial and policy director at the Center for an Urban Future, an independent, nonpartisan policy organization.

But he adds, “Addressing those problems by weakening penalties or enforcement isn't the right solution. Instead, we need a much stronger focus on developing the capacity to provide affordable financing and technical assistance needed to boost compliance.”

Aggarwala cites multiple city, state and federal programs that can help buildings comply with the law, offering grants, low-cost financing and technical assistance. “We are working as hard as we can to ensure that there is funding and financing available,” he says. He also called upon the city council to reinstate the J-51 tax credit, which he said would provide many buildings with up to 80% of the costs associated with compliance.

“So rather than exempting them from an obligation, we have a clear path that's been endorsed by the [Adams] administration that would help them pay for it, that would generate jobs,” Aggarwala says. “It would protect the environment. It would reduce local air pollution in those communities.”

Lee — and her supporters in middle-class co-ops and condos — are unmoved. “I think, practically speaking," she says, "(Local Law 97) set a really high bar that really could impact people financially in a negative way.”