An Overview of New York City’s Local Law 97

By: Ariel S. Holzer, Esq. and Maria Hirakis

In an effort to reduce greenhouse gas emissions, the New York City Council passed the Climate Mobilization Act in April of 2019, former Mayor de Blasio signed the bill and the law became effective on November 15, 2019.  Part of the Climate Mobilization Act included Local Law 97 (“LL97”). Under the law, most buildings larger than 25,000 square feet must meet new energy efficiency and greenhouse gas emissions standards by 2024. More stringent limits will follow in 2030.

LL97 aims to reduce emissions produced by the city’s largest buildings, which account for approximately two-thirds of greenhouse gas emissions in New York City. The goal is to reduce the emissions by 40% by 2030 ad 80% by 2050.  The crucial task facing property owners is to determine how their buildings are classified under these newly effective laws.  Falcon, Rappaport & Berkman LLP can assist owners in determining the relevant emissions standards for their building’s size and occupancies.

Buildings covered by the new law include (a) individual buildings that exceed 25,000 gross square feet, (b) two or more buildings located on the same tax lot that, combined, exceed 50,000 square feet (including condominiums and cooperatives), and (c) two or more buildings owned by a condo association that is governed by the same board of managers and that, combined, exceed 50,000 square feet.

Building owners can determine their energy usage by using the Department of Buildings Benchmarking tool[1] or consulting with a qualified architect or energy consultant. The amount of energy usage each owner must reduce to comply with the law depends on the occupancy types of each respective building. Some buildings may have multiple occupancies, while others may have just one.

The emissions standards differ based on the type of building category. Covered buildings that fall under one of the ten categories listed below must meet the requirements of the first round of emissions standards by 2024, and more stringent standards in 2030. Buildings owners can refer to the below table for general emissions standards:

For example, if a building is classified under occupancy R2 (Residential-Multifamily) and its floor area is 50,000 square feet, the emission limits for each period would be:

1. 2024-2029 = 337,500 kg CO2 eq (6.75 x 50,000)
2. 2030-2034 = 203,500 kg CO2 eq (4.07 x 50,000)

Some buildings that otherwise meet the definition of a covered building may have alternate compliance requirements, while others are exempt and are not required to comply with the law. Buildings with alternative pathways include:

• an industrial facility primarily used for the generation of electric power or steam;
• multifamily residences which do not exceed three stories, which are owned and maintained by each individual dwelling unit owner, with no central HVAC system or hot water heating system serving more than 25,000 Square Feet.
• a city-owned building;
• a housing development or building on land owned by the New York City Housing Authority (NYCHA);
• rent regulated accommodations with more than 35% rent-regulated dwelling units;
• a building whose main use or dominant occupancy is classified as an occupancy group A-3 religious house of worship;
• buildings owned by a housing development fund company; and
• buildings that participate in a project-based Federal housing program.

Buildings not required to comply with the regular reporting requirements of LL97 include industrial buildings that primarily produce electrical power or steam and detached or semi-detached buildings of three stories or less, where each owner owns and maintains their own HVAC and hot water systems that serve spaces of 25,000 square feet or less. Buildings containing rent-regulated units are also subject to a separate reporting regimen.  A building in which more than 35% of units are rent regulated (or which is an HFDC co-op, or has at least one unit participating in a federal project-based housing program or participates in NYCHA PACT) may opt out of the regular reporting requirements and emission limitations if it can submit evidence of having performed the following prescriptive measures required by the law:

1. Adjusting temperature set points for heat and hot water to reflect appropriate space occupancy and facility requirements;
2. Repairing all heating system leaks;
3. Maintaining the heating system, including but not limited to ensuring that system component parts are clean and in good operating condition;
4. Installing individual temperature controls or insulated radiator enclosures with temperature controls on all radiators;
5. Installing all pipes for heating and/or hot water;
6. Installing the steam system condensate tank or water tank;
7. Installing indoor and outdoor heating system sensors and boiler controls to allow for proper set-points
8. Replacing or repairing all steam traps such that all are in working order
9. Installing or upgrading steam system master venting at the ends of mains, large horizontal pipes, and tops of risers, vertical pipes branching off a main
10. Upgrading lighting to comply with new standards
11. Weatherizing and air sealing where appropriate, including windows and ductwork, with a focus on whole-building insulation
12. Installing timers on exhaust fans
13. Installing radiant barriers behind all radiators

Owners of these buildings would still be required to file a one-time emissions report in May of 2025. 

Buildings in which less than 35% of the units are rent regulated (but with at least one rent regulated unit) must comply with emissions standards but do not need to meet the standards until 2026 and would begin filing an annual emissions report until May of 2027.

For buildings with Mitchell Lama Housing (but no units that participate in a federal project-based housing program) or buildings with no rent regulated units but some units that are income-restricted through loans, grants or tax benefits, compliance with the emission standards is delayed until 2035 and filing of annual emissions reports would commence in May of 2036.

Owners of buildings that are not exempt or subject to the alternative compliance requirements outlined above, must keep the following key dates on their radar. Carbon limits take effect in 2024 and most covered buildings will need to submit their first compliance report by May 1, 2025, showing their carbon emissions for the previous year. These reports will have to be filed with the Department of Buildings by May 1^st of every year thereafter. All reports must be certified by a New York State Registered Architect or Professional Engineer.

Failure to file a report will result in a maximum fine of $.50/building SF, per month. False statements made in a report are considered a misdemeanor and will result in a fine of $500,000.00 and up to 30 days of imprisonment. Fines of $268.00 per metric ton of COS2e emitted over the limit will be issued against any building that releases emissions above their calculated limit.

Building owners should also bear in mind that the emission standards will increase again in 2030, so any compliance measures should be geared towards the increased standards, if practicable. The Department of Buildings (“DOB”) provides a variety of tools to help building owners meet all requirements under LL97. However, the DOB highly recommends hiring an architect, engineer, or energy consultant to assist owners in developing strategies to comply with the law and help owners meet specific needs.  Falcon Rappaport & Berkman can advise, assist and guide building owners through the process by assessing the applicable standards, referring and collaborating with qualified architects and environmental consultants. We encourage building owners to contact us for a full review of their building’s potential liability pursuant to the new regulations.

[1] For more information, see DOB’s publication, https://www.nyc.gov/assets/buildings/pdf/ll33_compliance_steps.pdf

[2] Carbon dioxide equivalent (CO2eq) stands for a unit based on the global warming potential (GWP) of different greenhouse gases. The CO2eq unit measures the environmental impact of one ton of these greenhouse gases in comparison to the impact of one ton of CO2. (https://climatepolicyinfohub.eu/glossary/co2eq)

Works Cited:

https://www.nyc.gov/site/sustainablebuildings/index.page

https://www.brightpower.com/compliance/local-law-97-ll97/

DISCLAIMER: This summary is not legal advice and does not create any attorney-client relationship.  This summary does not provide a definitive legal opinion for any factual situation. Before the firm can provide legal advice or opinion to any person or entity, the specific facts at issue must be reviewed by the firm.  Before an attorney-client relationship is formed, the firm must have a signed engagement letter with a client setting forth the Firm’s scope and terms of representation. The information contained herein is based upon the law at the time of publication.