Local Law 84 requires thousands of commercial and residential buildings to benchmark their energy and water use and to report this information to the city's Department of Finance. Noncompliance could lead to fines of up to $2,000 annually. Buildings required to comply are: (a) 50,000 gross square feet ("GSF") or greater, (b) two or more buildings on the same tax lot that together exceed 100,000 GSF and (c) two or more condominium buildings governed by the same board of managers that together exceed 100,000 GSF.
Is This Necessary?
In December 2009, as part of Mayor Michael Bloomberg's Greener, Greater Buildings Plan, the New York City Counsel passed a number of laws to (i) increase the energy and water efficiency of New York City's buildings and (ii) reduce annual citywide greenhouse gas emissions by 4.5 million metric tons of CO2e by 2030. Among four of the laws passed at that time, Local law 84 focuses primarily on 16,000 of the city's largest properties. The Mayor's Office estimates the laws will affect approximately one-half of all citywide square footage. Under Local Law 84, owners must submit building and utility information to the EPA’s Portfolio Manager tool annually and the Department of Finance will post the information generated by Portfolio Manager on its website and the public will be able to see which buildings are energy hogs and which ones are energy misers.
What Are The Penalties For Non-Compliance?
The law states, in part, that "failure to benchmark by August 1, 2011, or by May 1 of subsequent years, may result in a penalty of $500. Continued failure to benchmark may result in additional violations on a quarterly basis and an additional penalty of $500 per violation." If a building owner realizes that they use more energy than the next guy, they may decide that disclosing this type of data is not in their best interest. Similarly, although a small property just making the 50,000 GSF cutoff may see the $2,000 annual aggregate fine as enough of an incentive to comply with the law, for those properties much larger, the $500 quarterly penalty may be just added to their routine operating expenses, and compliance may never occur. Although there is talk of an increase in the amount of the penalty to be pegged to the GSF of a building, this has yet to be promulgated.
