Critics say real estate got Cuomo to “circumvent” city’s climate law

Legislators plan to nix workaround sought by building owners

New York /
Feb.February 26, 2021 08:45 AM
Gov. Andrew Cuomo (Getty, iStock)

Gov. Andrew Cuomo (Getty, iStock)

Some elected officials and environmental advocates are blaming the real estate industry’s cozy relationship with Gov. Andrew Cuomo for a change he proposed to New York City’s building emissions cap.

State legislators, along with ALIGN NY and other groups, oppose a clause in the governor’s executive budget that would allow building owners to buy renewable energy credits outside the city to offset their properties’ greenhouse-gas emissions.

The Real Estate Board of New York pushed for the change as a way for building owners to abide by Local Law 97, which caps carbon emissions for most buildings larger than 25,000 square feet. The city law allows owners to meet these restrictions by purchasing renewable energy credits generated within the city, but such credits are virtually nonexistent because the city has no wind or solar farms to speak of, nor any hydroelectric plants.

Many states permit less-restricted purchases of the credits, which help to fund renewable energy projects.

State Sen. Michael Gianaris criticized real estate lobbyists for going to Albany to get around the city law, saying such a tactic won’t fly with Democrats’ veto-proof majority in the Senate.

“We’re going to fight this, and we’re not going to support the circumvention of a local law,” he said during a virtual press conference Thursday. Gianaris appeared with four of the Assembly’s 150 members: Emily Gallagher, Jessica González-Rojas, Robert Carroll and Ron Kim.

The state legislature does occasionally supersede New York City laws. In 2017 it nixed the city’s 5-cent plastic bag fee just as it was about to take effect.

The Assembly and Senate are in the process of crafting their own proposals for the budget, which is due by April 1. Negotiations will likely be particularly tense this year: The press conference was titled “We Won’t Be Bullied by Andrew Cuomo,” a reference to heavy-handed tactics that the governor has in recent days been accused of using throughout his decade-long tenure.

Cuomo’s enemies have been emboldened by mounting criticism related to the governor’s reporting of nursing home deaths caused by Covid. Kim, a Queens lawmaker who alleged this month that the governor threatened to “destroy” him, said at the conference that he was disgusted by the Local Law 97 budget proposal.

Building owners say the law will punish owners whose buildings are efficient but heavily used and thus consume much power. Properties exceeding emission caps face an annual fine of $268 per metric ton of emissions over the limit — amounting to $2.4 million for Douglas Durst’s ballyhooed green building One Bryant Park.

In a statement, REBNY President James Whelan noted that unlike renewable energy credits, the fines would “go into City Hall’s pockets, not renewable energy creation or programs that create new green jobs.”

“The state’s proposal is a common-sense solution that sustains the renewable energy we need now while still encouraging the carbon emissions reductions we need for the future,” he said. “Any suggestion otherwise is not sound policy; it’s just a press release.”

The state’s Energy Research and Development Authority underscored that the governor’s measure is intended as a “temporary compliance mechanism” while owners “transition away from fossil fuel use in their buildings.”

Queens Council member Costa Constantinides

Queens Council member Costa Constantinides

Queens Council member Costa Constantinides, who sponsored Local Law 97, said the budget proposal endangers the city’s legislative process.

“It is one thing to be a stakeholder and be heard, and it’s another thing to say that you want to write the bill,” he said during an interview. “My job is not to make sure everyone is happy. It is to make sure everyone is heard, to make sure that the policy works.”

Mayor Bill de Blasio also opposes the budget measure.

Other groups do as well — yet agree that the city’s law, as written, presents challenges for buildings owners.

In a Feb. 17 letter to the governor, Assembly Speaker Carl Heastie and Senate Majority Leader Andrea Stewart-Cousins, design and environmental groups said the budget proposal was “fundamentally at odds” with the intent of Local Law 97. According to the letter, which was first reported on by New York Focus, the proposal incentivizes property owners to buy credits rather than paying for energy-efficient building retrofits.

Tom Wright, president and CEO of the Regional Plan Association, one of the letter’s signatories, said Local Law 97 has significant problems, but Cuomo’s fix “misses the mark in some ways.”

Wright said his organization and some others on the letter are working on a compromise — a compliance option focused on energy efficiency and electrification in affordable housing.

RPA’s position contradicts that of its chairman, the developer and tight Cuomo ally Scott Rechler. When asked where he stands on the budget proposal, Rechler called Local Law 97 “flawed.”

“While not perfect, the proposal in the budget at least attempts to rectify those flaws,” Rechler said in an email. “Unless there is an alternative proposal that promotes sustainability while holding the industry accountable, I would support the budget proposal as I would rather not sacrifice the good for the perfect.”





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