The City of Chicago has introduced a mandatory energy disclosure ordinance that will ultimately affect all buildings over 50,000 square feet. The Chicago Association of REALTORS® (C.A.R.) and the Apartment Building Owners and Managers Association (ABOMA) have expressed a number of serious concerns about the proposal and have asked for deferral of a vote on this matter until these issues are resolved and a city-wide pilot project is established.
Both C.A.R. and ABOMA support the notion of voluntary disclosure and moreover understand the issues relating to energy use and efficiencies. That said, we need your help to assure the Zoning, Landmarks and Building Standards Committee does not vote on this matter next Tuesday. We are asking property managers to share this information with their owners and renters, and also to call their respective aldermen to voice concern.
For committee contact information, click here.
HERE IS WHAT YOU NEED TO KNOW ABOUT THE CHICAGO ENERGY DISCLOSURE ORDINANCE:
-Will affect all apartment and condo buildings of 50,000 square feet or more by June of 2016. All residential buildings of over 250,000 square feet must disclose energy use in 2015.
-The failure of any tenant to provide information to ownership will be subject to a fine of up to $100.00 for the first violation, and an additional fine of $25.00 for each day that the violation continues. While electric bills are readily available from ComEd, you must be able to get your tenants and unit owners to disclose gas usage. Again, failure to provide information will create a fine.
-For a condo association, the fines could amount to $9,200 per year.
-Condo buildings will have to have their energy usage verified by a licensed professional in the first year and prior to each third benchmarking deadline thereafter. THIS IS AN ADDED COST FOR CONDO AND APARTMENT BUILDING OWNERS.
-Poor energy efficiency scores could stigmatize properties at time of sale and result in lower property values as a result.
-Condo fees will rise due to additional responsibilities upon them, including the potential for future retrofitting and upgrades to meet city standards or goals, based on aggregation of these building reports.
-The results of both commercial and residential building audits will be posted placed online by city regulators.
-A number of cities have these audits already in place, but there is no definitive research that shows this type of mandate decreases energy use. In fact, federal, state or local funding to assist buildings with issues is an open question.
-Tenants/unit owners will be mandated to provide energy use data to building owners or property managers. Failure of the tenant/unit owner to provide the data to the building owner or property manager will not relieve the owner of the responsibility to benchmark the building, and fines would be assessed.
-Failure of the tenant to provide information creates a rebuttable presumption the owner, tenant or both have not complied with the ordinance; thus a fine shall be applied.
-Commercial buildings of 250,000 square feet or more are due June 1, 2014; buildings with 10 percent residential occupancy of 250,000 square feet or more are due no later than June 1, 2015, and every June 1st thereafter.
-Commercial buildings from 50,000 to 250,000 square feet are due in June 1, 2015; buildings with 10 percent residential occupancy of 50,000 to 250,000 square feet are due June and every June 1st thereafter.
-This ordinance will go into effect 10 days from passage.
It is critical condo owners reach out to the following Aldermen on the Zoning, Landmarks and Building Standards committee to ask for deferred action on this ordinance until all stakeholders have had the opportunity to fully understand its implications on buildings throughout Chicago. This ordinance will be heard on with probable passage on July 24th.