New Law Narrows Exemption from Climate Mobilization Act for Buildings Containing Rent-Regulated Units

December 2, 2020 Advisory

We previously alerted our clients and contacts to the passage of the New York City Local Laws collectively referred to as the “Climate Mobilization Act” (the Act), which are aimed at cutting greenhouse gas emissions and making buildings more energy efficient. We have since updated our memorandum, which you can access here, to incorporate Local Law 116 of 2020, enacted on Nov. 17, 2020. 

Previously, a building with at least one rent-regulated apartment was exempt from complying with the Act. Local Law 116 has now amended the Act to provide that, in order to be exempt, more than 35% of a building’s apartments must be rent-regulated. This change is a significant one for many buildings with a small number of rent-regulated units, which now find that they meet the definition of a “covered building.” We encourage our clients with rent-regulated units to determine whether their building meets the 35% threshold required to maintain exemption from the Act.

The good news is that buildings with rent-regulated units that were originally exempt from the Act, but became covered buildings under Local Law 116 of 2020, do not have to comply with annual emissions limits until Jan. 1, 2026, and do not have to submit their first compliance report until May 1, 2027. 

Please reach out to us with any questions about this recent change to the Act.

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