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How Will Updates to the City’s Local Law 97 Affect Your Cooperative or Condominium?

Co-ops and Condos

Since our blog post in 2022 discussing New York City’s greenhouse gas caps under Local Law 97, new updates have emerged that warrant close consideration. The legislation took effect on January 1, 2024, precipitating considerable financial challenges for condominiums and cooperative apartments in New York City. Aging buildings, particularly prewar structures, often rely on outdated energy systems such as boilers for steam heat distribution. Compliance with Local Law 97’s energy efficiency requirements necessitates transitioning to electric heat pumps. This is just one example of the scope of work ahead for New York City’s cooperatives and condominiums. With significant changes to building mechanicals come increased costs which individual owners and shareholders will bear. Some of these updates to Local Law 97 are geared to mitigate the onerous costs associated with the law.

Financial Challenges Being Mitigated

In October 2023, the New York City Department of Buildings clarified “Good Faith Efforts” under Local Law 97, providing a pathway for condominiums and cooperatives to mitigate penalties for failure to timely comply with the law. This clarification allows building owners to potentially reduce expected penalties by demonstrating compliance efforts through annual emissions reporting, compliance with Local Law 84 (energy benchmarking), and Local Law 88 (lighting upgrades and sub-meter installation). Looking forward, there is optimism for condominiums and cooperatives to effectively manage their obligations under the law.

Possible Assistance with Emissions Calculations in the Future

Int. 772, sponsored by Linda Lee and supported by 25 New York City Council members, aims to amend the climate law by allowing condominiums and cooperatives to include gardens and other green spaces in their square footage calculations for carbon emissions limits required by Local Law 97. If passed, the bill could increase allowable emissions for these buildings, reducing the need for costly carbon-cutting retrofits to comply with the law.

Lee’s bill provides further relief by proposing gradual reductions in penalties for condominiums and cooperatives valued under $65,000 if they have implemented previous retrofits aimed at reducing emissions.

Guidance for the Short Term

Whether or not Int. 772 is passed, condominium owners and cooperative shareholders should measure and understand the current carbon emissions of their buildings based on existing calculations without including gardens or green spaces. They should also plan for compliance with the current carbon emission caps, considering potential costs and retrofit requirements. If you would like to discuss compliance under Local Law 97, or any issues relating to cooperatives and condominiums, please contact us to schedule a consultation.

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