There is a version of this topic that gets written constantly, and it is about retrofits. Heat pumps, envelope upgrades, controls, electrification. All of it real, all of it expensive, and almost none of it the thing that is currently generating penalties. The first wave of enforcement under New York's Local Law 97 was not about buildings that emitted too much. It was about buildings that did not file.

That distinction is the whole point of this article, because filing is a property management responsibility and retrofits usually are not. The capital work belongs to the owner. The deadline belongs to you. A note before going further: building performance standards are local law and they change frequently. Treat this as general background rather than legal advice, and confirm specifics with counsel and your local jurisdiction.

What Building Performance Standards Actually Require

Building performance standards, usually shortened to BPS, are local laws that set enforceable limits on a building's energy use or greenhouse gas emissions and require owners to report performance annually. They differ from older energy benchmarking rules in one crucial way: benchmarking required you to disclose, BPS requires you to comply.

More than a dozen US jurisdictions now have one, including New York City, Boston, Washington DC, Denver, Seattle, Montgomery County, and Washington State, with more in development. They share a structure but agree on almost no details. Thresholds, covered property types, metrics, deadlines, and penalty mechanisms all differ.

For a single-market operator, that means learning one law. For a portfolio spanning several cities, it means maintaining a matrix, and the matrix is the part most companies have not built.

1. They Do Not Measure the Same Thing

The detail that breaks portfolio-level reporting is that these laws do not share a metric. A building's compliance position in one city cannot be compared to another, or rolled into a single portfolio number, because the underlying units differ.

Note what that column does to a portfolio report. A Denver building improving its EUI and a New York building reducing its carbon intensity are not measured in comparable units, and a Washington DC building is graded against a percentile score rather than an absolute figure at all. There is no single compliance metric to report to an owner who holds assets in three of these markets.

Thresholds, deadlines, verification requirements, and penalties differ as well, and they change frequently. Boston extended its reporting deadline twice during 2026, Maryland's standard was subject to a federal challenge that was dismissed in March 2026, and Denver revised its regulations following stakeholder consultation. Any table of specific figures, including one you find on a vendor site, should be treated as a starting point rather than authority. Confirm against the jurisdiction's own programme page, and use the Institute for Market Transformation as a neutral reference point on the policy landscape.

2. Two Separate Obligations

Every BPS creates two distinct duties, and conflating them is the most common and most expensive mistake in this area.

The reporting obligation is administrative. Submit accurate data, in the required format, by the deadline, usually verified by a qualified professional. It costs staff time and a professional fee.

The performance obligation is physical. Keep emissions or energy use below a declining cap, which may require capital work.

You can be fully compliant on performance and still face enforcement for missing the filing. That is not a hypothetical.

3. The Evidence That Reporting Is the Live Risk

New York City's Department of Buildings reported that roughly 28,000 buildings submitted Local Law 97 compliance reports, while about 1,400 properties that were required to report failed to do so and now face enforcement action. Notices of Deficiency went out with a 60-day window to file late, and the department began preparing case filings for those still out of compliance.

Fourteen hundred buildings did not miss an emissions target. They missed a form. Whatever those owners spent or did not spend on retrofits was irrelevant to the enforcement they received.

Why This Lands on the Property Manager

The instinct is that emissions belong to the owner, because the owner funds the capital work and holds the asset. That is true of the retrofit decision and false of everything leading up to it.

Consider what a compliance filing actually needs: twelve months of energy consumption across every fuel type and meter, accurate gross floor area, correct property type classification, tenant space data where the owner does not control the meter, and a qualified professional willing to certify it. Every one of those is operational data that lives with the manager, not the owner.

There are three specific ways the burden sits with you:- 

1. You Hold the Data, or Nobody Does

Utility bills, meter readings, submeter data, occupancy, and square footage by use type are property management records. An owner asked to produce twelve months of consumption data for a covered building will forward the request to their manager.

If that data lives in a filing cabinet, in a spreadsheet a former employee maintained, or scattered across utility portals with different logins, assembling it becomes a project each year rather than an export.

2. Tenant-Controlled Space Is a Contractual Problem

Where residents or commercial tenants hold their own utility accounts, the owner may have no automatic right to that consumption data, and yet it counts toward the building's total. Obtaining it depends on lease language and on your relationship with the tenant.

That is a leasing and lease administration problem, which is to say it is yours. It also has a long lead time, because the clause has to be in the lease before you need the data, not after.

3. The Deadline Has No Owner

Capital planning has a natural owner in most companies. Annual regulatory filings for a subset of buildings, in a subset of markets, on dates that differ by jurisdiction, frequently have none.

That is precisely the shape of obligation that gets missed, and it is almost certainly what happened to a good portion of those 1,400 buildings.

The 2030 Problem

Current compliance rates are misleading, and reading them without looking forward is how portfolios walk into a wall.

Urban Green Council's analysis of New York benchmarking data found that around 9 percent of properties exceed their 2024 emissions cap, while roughly 57 percent exceed the cap that takes effect in 2030. Read those two numbers together. A large majority of buildings that are comfortably compliant today will not be compliant in four years, without doing anything differently, because the cap moves rather than the building. Under LL97's Article 320 pathway, exceeding the limit carries an annual penalty of $268 per metric ton of CO2 equivalent over the cap.

The planning implication is uncomfortable but simple. Capital works with multi-year lead times need to be in a plan now, and the case for them has to be made to owners who are currently looking at a compliant building and asking why they should spend money. That conversation is far easier with a projection than without one, which is another reason the data problem comes first.

What to Actually Do

None of the below requires deciding on retrofits. It is the work that has to happen regardless of what the eventual capital answer is, and it is almost entirely within a management company's control.

The order matters, because each step depends on the one before it:- 

1. Build the Covered Buildings List

Establish, for every property you manage, whether it is covered by a BPS in its jurisdiction, under which threshold, and on what reporting cycle. Include the aggregation rules, since several laws cover multiple smaller buildings on a single tax lot or under one condominium board that individually fall below the threshold.

Most managers cannot produce this list today. It is the single highest-value artefact in this whole area and it takes days rather than months.

2. Assign Named Ownership Per Deadline

One person, per filing, per property, with a calendar entry and a named backup. Not a team, not a department.

The 1,400 non-filers in New York almost certainly included buildings where several people each assumed someone else had it.

3. Get the Consumption Data Into One Place

Utility accounts, meters, and submeters should feed a single record rather than living in separate portals. Whether that happens through utility data aggregation, submetering, or disciplined manual capture matters less than that it happens continuously rather than in a scramble each spring.

This is the same argument as maintenance documentation for insurance renewals, and the same data usually serves both. Our guide to maintenance as a competitive advantage covers capturing operational evidence in a form that is usable later.

4. Fix the Lease Language

Add data-sharing provisions covering tenant utility consumption to your standard lease and renewal templates now. Every renewal cycle that passes without it extends the gap by another lease term.

5. Model the Forward Position

Project each covered building against the next cap, not the current one, and put the projected penalty exposure in front of owners during budget season. Our operating cost benchmarks provide context for where that sits against other cost lines.

The Part Vendors Do Not Say

Two honest observations that complicate the usual pitch.

Paying the penalty is sometimes the rational choice.
For a building modestly over its cap, an annual penalty may cost less than a deep retrofit, particularly where the asset is likely to be sold before the next tightening. That is a legitimate calculation for an owner to make, and a manager who presents only the retrofit option is not giving complete advice. The calculation changes as caps tighten, which is why the projection matters more than the current-year number.

Good-faith pathways carry their own risk.
Where a jurisdiction allows a compliance plan in place of immediate performance, that relief is generally conditional on demonstrable progress. Claiming it and then not delivering can expose an owner to accumulated penalties across multiple years rather than one. If you go down that route, the evidence of progress has to be captured as it happens.

Neither of these argues against acting. Both argue for doing the data work first, because every one of these decisions depends on knowing your actual position.

Where the Technology Comes In

Everything above is a data and deadline problem before it is a sustainability problem. Covered-building status, floor areas by use type, consumption history, capital works completed, and filing dates all exist somewhere in most operations, in different places, owned by different people.

That is the problem RIOO is built for, and the split is worth being precise about:

• Property and unit records, facility management, maintenance, capital works, and lease administration run inside RIOO as a purpose-built property management layer, so building attributes and completed works accumulate against the asset rather than being reconstructed when a filing is due.

• Finance, multi-entity accounting, budgeting, and reporting are handled by the NetSuite core RIOO is built on, which is where that depth is native.

• Both draw on one record, so compliance exposure can be modelled alongside capital plans and owner reporting rather than assembled separately.

The practical effect is that an annual filing becomes an extract rather than a project. RIOO runs more than 180,000 units under management across residential and commercial portfolios on that architecture.

Where to Start

Produce the covered buildings list. Nothing else in this article can be sequenced until you know which properties are in scope, under which law, with what deadline.

Then take the three properties with the largest gap to their next cap and model the exposure. That is enough to open the conversation with owners, and it is the conversation that needs the longest lead time.

Book a RIOO Demo

RIOO keeps building attributes, capital works history, and property financials on one record, so compliance reporting draws on data you already hold. Book a demo and see how it works across a multi-jurisdiction portfolio.

Frequently Asked Questions

1. What are building performance standards?
Local laws that set enforceable limits on a building's energy use or greenhouse gas emissions and require annual reporting against them. They differ from older benchmarking ordinances, which required disclosure but not performance. More than a dozen US jurisdictions have adopted one, including New York City, Boston, Washington DC, Denver, Seattle, and Washington State, and the thresholds, metrics, deadlines, and penalties differ in each.

2. Who is responsible for BPS compliance, the owner or the property manager?
Both, in different parts. Capital decisions and penalty liability generally sit with the owner. The reporting obligation depends almost entirely on the manager, because the required inputs are operational records: utility consumption across all fuel types, floor area by use type, property classification, and tenant space data. In practice an owner asked for a compliance filing will forward the request to their manager.

3. What happens if you miss a BPS filing deadline?
Enforcement follows independently of whether the building met its emissions target. In New York City, roughly 1,400 properties that failed to submit Local Law 97 reports received Notices of Deficiency with a 60-day window to file late, with case filings prepared for those that remained non-compliant. A building fully under its cap can still face penalties purely for not reporting.

4. Why do compliance rates get worse over time?
Because the caps tighten on a schedule while the building stays the same. Urban Green Council's analysis found around 9 percent of New York properties exceed the 2024 cap, but roughly 57 percent exceed the 2030 cap. Buildings that are comfortably compliant today become non-compliant without changing anything, which is why planning has to work from the next cap rather than the current one.

5. Is it ever cheaper to pay the penalty than to retrofit?
Sometimes, particularly for a building modestly over its cap where the asset may be sold before limits tighten further. It is a legitimate calculation and an owner is entitled to make it. The important caveat is that the arithmetic changes as caps ratchet down, so the comparison should use projected exposure across the next compliance period rather than a single year, and it should be documented as a decision rather than arrived at by default.