Despite the opposition of the real estate lobby, New York City Mayor Zohran Mamdani should fully implement and enforce Local Law 97.
Deep down in the basements of many of New York’s large buildings sits an old, dirty beast: a decades-old oil- or gas-fired boiler. These boilers are our city’s top source of pollution. Replacing aging, inefficient and polluting oil and gas boilers with energy efficiency upgrades and clean, energy efficient heat pumps that don’t rely on fossil fuels is a big challenge. And though it costs something up front, it also gives us an enormous opportunity to reduce utility bills over time, create good jobs and slash pollution.
In 2019, New York City enacted Local Law 97 to meet the challenge. The city’s landmark law — the first of its kind worldwide — covers roughly 50,000 buildings, all larger than 25,000 square feet. That’s about half a football field, and any building from, say, a 4-6 story residential building to One World Trade Center is covered. Local Law 97 requires these buildings to reduce their pollution under annual limits.
Any given building’s pollution cap is defined by type and use, so a large property's limits over time take into account a sometimes complex mix of uses, which can have quite different energy use profiles. The law also sets specific standards for rent-regulated and public buildings.
The statute’s first pollution limit applied in 2024, which gave building owners five years to prepare. Every five years, the pollution caps will ratchet down. The initial 2024-2029 pollution limit is relatively easy to meet, while the 2030-2034 limit is much lower.
As of 2023 — a full year before the law's first annual limits applied — 92% of large buildings were below their initial five-year pollution caps. That’s a major improvement from about 80% when the law passed in 2019. In 2023, 49% of multifamily buildings were already below the law’s tighter 2030-2034 pollution limits, a full seven years “ahead” of schedule. That’s up from about 25% when the law passed in 2019, which is also a major advancement for the city.
It’s quite likely that when the data is crunched, even more than 92% of buildings will be shown to have been in compliance with the law’s 2024 limits. Indeed, at the current rapid pace of pollution reductions — with a few percentage points worth of buildings upgrading to better systems and practices per year — virtually 100% of covered buildings are on track to meet Local Law 97’s pollution limits for 2024-2029. Moreover, at that pace of improvement, compliance will remain close to 100% in 2030-2034, when the pollution limits become much tighter.
Almost every week, green building experts, advocates, government, academics, expert consortiums and specialty publications document another success story: a large building slashing its energy waste in response to Local Law 97. Public energy use reporting by big buildings has been in place for about 15 years now under Local Law 88, enacted under Bloomberg. If a building is covered by Local Law 97, anyone can easily look up its status. Energy efficiency is advancing rapidly as large buildings remedy wasteful, inefficient practices.
And there are still plenty of “low-hanging fruit” energy efficiency opportunities: Many of the city’s buildings are yet to implement easy upgrades, such as insulating exposed heating pipes; weather-stripping; switching to LED lighting; covering or removing window unit air conditioners in the winter and installing simple valves, vents and controls to reduce energy waste. Those upgrades cost something but pay off over time, sometimes in short order.
Many building owners are also financing more complex energy efficiency upgrades and in the process saving themselves more than the cost of their financing through reduced operating costs.
Yet the real estate lobby, which bitterly opposed the law’s passage, has been hard at work trying to convince policymakers, political insiders and the media that Local Law 97 is unaffordable or impractical. Their goal is to roll back the law — or to defang enforcement by eliminating penalties.
Advocates for Local Law 97, such as New York Communities for Change and our allies, are massively outspent by industry-financed ad campaigns, Super PACs, PR work, big campaign donations, front groups, astroturfed support and a lawsuit that took years to dismiss in the courts.
Some of the arguments made by the law’s deep-pocketed opponents are rank fear-mongering. For example, the $1.3 million Super PAC against Mayor Mamdani and Local Law 97 distributed outrageous flyers in co-op buildings claiming “your monthly maintenance will go up, possibly by $1,000 per month or more”, amidst other outrageous claims. Such false messaging can genuinely scare people. Of course, it can cause them to turn against well-considered public policy.
If only Local Law 97 could sue for defamation!
Rebutting every argument we have heard would take a long write-up, indeed. But to take one leading complaint: the law’s opponents commonly claim its penalties are “draconian.” Under the law, buildings are to be charged up to $268 per ton if the property exceeds its pollution limit. Opponents take the worst-case scenario — in which a building does nothing to reduce its pollution — and multiply the total penalty out to tens of thousands or hundreds of thousands of dollars to make the legislation seem ridiculously punitive.
But some of the covered buildings are billion-dollar properties. Even outer-borough co-op complexes’ annual revenues from maintenance come to many millions annually. Per unit, Local Law 97 penalties will not be draconian. Divided by the number of units, potential penalties are not much bigger than nuisance parking-ticket level.
For example, in 2023, a leading Local Law 97 opponent claimed that the co-op complex he leads would pay $394,000 penalties in 2024, when the law’s first pollution limit began. That sounds like a lot, but on a per unit basis it’s only $135 because the building complex has 2,904 units. Meanwhile, the complex can simply avoid breaking the law by improving its energy efficiency — and as of 2023, 92% of buildings were under those 2024 initial limits. If a building doesn’t exceed its pollution cap, there are no violations and no penalties at all, naturally. Far from “draconian,” the dreaded penalties are more of a firm nudge in the right direction than an executioner’s falling ax.
Moreover, the law includes provisions to adjust pollution limits — loosen them — to take account for unusual, outlier circumstances not already fairly considered in the law’s pollution cap formula for any given building. If a building is undertaking “good faith” action — defined as such by regulation and law — a building will be able to demonstrate its case for an easier path if it so chooses, and regulators can adjust its pollution limit. But of course, at the end of the day, there must be some penalty assessed on non-compliance or the law is easy to disregard.
Local Law 97’s success thus far came with very little support from the former mayor of New York, who was elected two years after it passed. When he was in office, Eric Adams delayed enforcement and opened loopholes for landlords to evade pollution limits. Meanwhile, much-hyped legislation to gut Local Law 97 stalled amidst fierce grassroots opposition to a roll back.
As political forces battle, dedicated public servants in multiple agencies — who rarely get the public praise they deserve — are implementing the law, which takes hard work, good judgment and real expertise.
That’s good news, but the job is far from done. Under Zohran Mamdani, the city should fully implement and enforce Local Law 97.
In the near term, Mamdani should take enforcement actions against the tiny minority of building owners who are thumbing their noses at the law by not getting below the law’s pollution limits — or even failing to report at all. These buildings unfortunately tend to be very wasteful in their practices, as they are at the very high end of energy use per square foot and therefore outsized drivers of pollution in the city. They typically waste real money and add to the city’s air pollution because they haven’t implemented even some of the basics of energy efficiency. Deeply unfortunately, the scare campaigns and the now-dismissed lawsuit against the law have led some owners to believe that the law will never be enforced — and that they therefore can just ignore it to no consequence. That’s a serious mistake. (It also implies widespread problems in their properties that should be remedied, not further covered up.) 2024 public data on each building and its compliance will soon be available. Local Law 97 will expose some owners who have been swimming naked in the ocean as the tide runs out.
The City should also close regulatory loopholes that allow building owners too much leeway to purchase Renewable Energy Certificates in place of reducing pollution. It should properly issue the many necessary further rules, regulations and guidelines for the law, which detail everything from how building owners can apply for an adjusted pollution limit for 2030 and onwards to a critical formula defining how much pollution the law attributes to the electric grid from 2035 onward as part of the calculation of any given building’s total pollution. These are technical tasks that require ongoing expertise and effective civil servants — and so far, talented staff in multiple agencies covering this program have done a good job. With the State, the City needs to reauthorize the J51 tax credit for energy efficiency, which lapsed at the end of December (Hochul recently proposed to do this at the state level, so between her and Mamdani’s commitment, this particular ball is set to roll). By 2035, the City should allocate hundreds of millions of dollars more per year to energy efficiency investments in affordable housing, in addition to properly maintaining NYCHA.
Mamdani’s already made a strong choice in appointing Ahmed Tigani as his Department of Buildings commissioner, the top post at that key agency. In the next several years — perhaps the length of a two-term Mamdani mayoralty — the City should pursue a multi-pronged strategy to accelerate energy efficiency upgrades. First, it should drive down the cost of energy efficiency equipment and services by aggregating demand and using the City’s financing and credit to backstop a loan fund for owners to tap for standardized loans, which would lower borrowing costs and thus make larger capital upgrades cheaper. Secondly, it should expand its already-considerable work to educate owners, contractors, firms and workers on best practices. Third, it should increase the scale and ease-of-use of existing subsidy programs delivered by government, utilities through ratepayer programs and nonprofits that help finance and offer free expert help to execute energy efficiency upgrades. Finally, the City should run a major public education effort to teach the general public about the necessity of climate action and its opportunity for energy bill savings and good jobs.
Mamdani and the City Council should also push Gov. Hochul to begin the state’s Clean Air Initiative (aka “Cap and Invest”), which would cap pollution statewide and make polluters fund investment into reducing pollution, including that which comes from dirty oil and gas boilers. Similarly to congestion pricing, the program was ready to be introduced, but in a major surprise even to her own agencies, the Governor delayed the program at the eleventh hour. The program is now in a similar limbo to the one congestion pricing stood in before Hochul waved it forward, although a court ordered the state to proceed with it after climate justice groups sued, an order the Governor is currently appealing.
The City should also advocate that in future decades, the State allocates much more funding, raised from progressive revenue sources, than even the Clean Air Initiative would provide. This would help make it financially beneficial for every building owner to go entirely fossil-free. For example, the City should push the State to enact Sen. Gustavo Rivera and Assemblymember Al Stirpe’s Bucks for Boilers Act, which would pay for heat pumps and energy efficiency upgrades and phase out all oil and gas boilers over time.
Fortunately Mamdani, for whom affordability is presumably a larger priority than reducing pollution, clearly understands the importance and value of Local Law 97. Energy efficiency, after all, lowers utility bills over time. Mamdani has repeatedly pledged to fully implement and enforce the statute. He has demonstrated a grasp of the issue’s specifics, from applying penalties on recalcitrant owners to lowering the cost of heat pumps and extending the generous J51 tax credit for energy efficiency for low- and middle-income co-ops and condos. While in the Assembly, Mamdani also helped defend Local Law 97 when then-Governor Andrew Cuomo attempted to override it at REBNY’s behest in the state budget process.
As Mamdani points out, fighting climate change and lowering bills aren’t incompatible, even though major energy efficiency upgrades add up front costs that are typically financed over time. Indeed, how can New York City be affordable in future years if about 30% of it chronically floods?
Decades ago, our buildings used coal and the city choked on pollution. While that seems unthinkable now, the coal lobby of its day tried to hang on to its profits then, too. The coming decades will bring another transition: from polluting oil and gas to heat pumps and energy efficiency. As in his electoral campaigns, Mamdani should power past the fearmongering of vested interests and stick to his guns on Local Law 97.