Proposed Rules Offer Some Relief for Owners Under Local Law 97

The New York City Department of Buildings has proposed a set of rules to supplement Local Law 97 (Proposed Rules). Once approved, the rules will be applicable beginning in 2024. The Proposed Rules include a number of notable provisions that may mitigate penalties imposed on building owners for failing to timely comply with Local Law 97 deadlines and/or emissions limits.

One of the Proposed Rules that might greatly impact cooperatives and condominiums recognizes the enormous economic investment required to comply with emissions limits. This proposed rule (the so-called “Good Faith Efforts” Rule) provides an owner of a building the opportunity to potentially avoid and/or mitigate penalties if the building is not in compliance as long as the owner can demonstrate Good Faith Efforts to comply. A couple of those proposed efforts include:

• Good faith in failing to timely file an emission report requires an owner to show that the professional retained to file the report will be unable, in good faith, to complete the report by the reporting deadline; and
• Good faith in failing to meet the emissions limits requires an owner to have previously submitted an annual building emissions report and to have a fully approved application and permit for the work needed to meet compliance.

Another of the Proposed Rules may mitigate a building owner’s penalty if the owner fails to comply with its emissions limit due to an unexpected or unforeseeable event. If an owner can demonstrate that it was unable to comply in a particular calendar year because the building sustained damage due to an unexpected or unforeseeable event or condition outside its control, including, but not limited to, a hurricane, severe flooding, or fire, the penalty for noncompliance for that year may be greatly reduced.

The Proposed Rules are due for a public hearing on Oct. 24, 2023, and a final version is expected to be released before the end of the 2023 calendar year. Comments on the Proposed Rules can be emailed to [email protected].

Please consult your regular AT lawyer or one of the authors, your building’s engineer, the Department of Buildings or city-sponsored NYC Accelerator’s office if you have any questions or would like additional information on Local Law 97 or the Proposed Rules.