Commendations on carbon cutting, caution on capacity
Despite recent headwinds, state and local governments across the country continue to develop and adopt building performance policies, ranging from building performance standards (BPS) to energy benchmarking and energy codes, as a way of meeting their goals to reduce energy use, lower utility bills, and advance climate action. Even with more limited resources, some smaller cities are proving themselves to be real trend-setters and go-getters. As the children/youths say where I grew up “mad respect to them for that.” For reference, all of the cities we are referring to here as “smaller” have total populations of less than 100,000 people. Let’s get stuck into our starter and main course of exploring the newly adopted policies as well as those on the horizon, followed by some IMT best practice recommendations for dessert and aperitifs.
Policies adopted after the November 2024 presidential election
At the time of writing, we are now in the sixth week of the new administration, and there have been significant shifts in priorities, with climate action and federal funding commitments facing uncertainty. Despite these changes, state and local governments have continued to adopt and lay the groundwork for building performance policies, which is a continuation of the trend we saw the last time this administration was in power. We know you all love our BPS Map and Matrix, and these have been recently updated to reflect the new policies highlighted below, as well as adding additional nuance on compliance pathways.
BPS Law: Newton, MA, Building Emissions Reduction Disclosure Ordinance (BERDO)
The City of Newton, Massachusetts, adopted a BPS law back in December of 2024. Newton’s BPS follows a similar structure to Boston’s BERDO. The law will cover commercial and city-owned buildings over 20,000 square feet, and the expectation is that the law will be amended to include multifamily properties down the line. Newton’s BPS will require covered buildings to be net-zero by 2050, and there will be progressively stringent compliance cycles that will begin for the largest covered buildings in 2030.
Newton estimates that buildings account for 64% of the City’s greenhouse gas emissions. According to a memo presented to Newton’s City Council, the City’s BPS will regulate 385 buildings, which cover an estimated combined floor area of 25.3 million square feet, which is 20% of the total building floor area in Newton.
Benchmarking Law: Clayton, MO, Building Energy Awareness
The City of Clayton, Missouri, adopted a building benchmarking law earlier in February this year (see p39). Clayton’s Building Energy Awareness law will cover city-owned buildings over 10,000 square feet, and commercial and multifamily buildings over 100,000 square feet. City-owned buildings will need to begin complying in April of this year, with covered commercial and multifamily buildings beginning to report their energy use in 2027.
Clayton estimates this will cover four city-owned properties and up to 60 commercial and multifamily buildings. We commend Clayton for having passed this law. As the adage goes, you can’t manage what you don’t measure, and this will be an important step for the City in terms of meeting the sustainability goals of its Strategic Plan.
BPS laws on the horizon
There are several other smaller cities that are taking steps to adopt BPS and other building performance policies in the coming months:
- Evanston, IL – Healthy Buildings Ordinance – due to be voted on in March 2025
- Watertown, MA – Building Emissions Reduction and Disclosure Ordinance (hey look, another BERDO!) – anticipated in Q1 2025
- West Hollywood, CA – Equitable Building Performance Standards – anticipated in Q2 2025
- Santa Monica, CA – Building Performance Standard – anticipated in Q2 2025
When these other laws are adopted, IMT plans to publish a comparative analysis to examine their similarities and differences.
Successful implementation guidelines
Implementing and enforcing BPS laws and the like can require significant time and effort for government staffers. Additionally, their appropriateness as a policy solution to improve the performance of existing buildings can vary significantly depending on the building stock of a location. Along with my IMT colleagues, I plan to explore this further in the coming months, as well as highlighting policy alternatives that smaller cities can consider, with examples.
Staffing and budget
IMT’s BPS Implementation Guide lays out the best practices, strategies, processes, and rules that local and state governments can use to implement BPS laws successfully. Below are some staffing examples from governments currently implementing BPS and building benchmarking laws.
| Location | Number of Covered Properties | BPS Government Staff | Budget |
|---|---|---|---|
| Denver, CO | ~ 3,000 | 9 FTEs | $1.6 million annually (personnel and administrative costs only) |
| Montgomery County, MD | ~ 1,900 | 7 FTEs | $1.1 million annually |
| St. Louis, MO | ~ 900 | 4 FTEs | $299,600 annually (personnel costs only) |
| Washington, DC | ~ 3,000 | 10 FTEs | $1.1-1.2 million annually |
If we do some back-of-the-envelope calculations, the above figures lead us to these headline costs for implementing governments: 1 FTE for every 250 – 300 covered buildings, and around $350 – $550 of administrative/personnel costs per covered building. As the data shows, the number of staff and budget required to implement BPS laws can be substantial, and resources are still needed to reach policy goals whilst keeping the costs affordable. With apparent reductions in both the volume and stability in financial support at the federal level, IMT recommends local governments pivot to state sources where available, and pursue private funding to fill gaps. IMT’s BPS Implementation Guide provides further details on the staff roles and responsibilities these governments have in place.
Building stock variety
Making building improvements to comply with BPS laws requires capital investment, and the general trend we see is that the smaller a covered building is, the less access to financial capital or administrative capacity an owner is likely to have. As such, smaller cities may find that owners of smaller covered buildings will need more time and support to be able to access the necessary capital to comply with BPS laws, and these cities may need more state support for successful BPS implementation. IMT plans to publish more on this particular topic in the coming months.
Takeaways
Buildings are a critical component of both climate action and economic opportunity, and they are often responsible for high percentages of a location’s electricity consumption and greenhouse gas emissions. Policies such as BPS can dramatically reduce energy waste while encouraging market shifts toward high-value, high performance buildings. In the long-term, these improvements lower energy costs for everyone, reduce the strain on the local utility grid, and create healthier, more productive spaces for residents and businesses.
Local and state governments led climate action during the previous
Trump administration, and these examples from smaller cities show
that trend is going to continue.
BPS laws continue to be a viable building decarbonization policy solution for state and local governments. The question around BPS is no longer “Is this happening/will it continue to happen?” but rather “Who’s next?”
