Pick up the pace: A guide on how condos and co-ops can fund Local Law 97 upgrades

Board member education
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April 11, 2023
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Pick up the pace: A guide on how condos and co-ops can fund Local Law 97 upgrades

Local Law 97 has the potential to change our city for the greener. This said, going green can require a good deal of green. As you start to face Local Law 97 head-on, here are some good first steps, resources, and financial opportunities to put your best green foot forward. 

Why should you reduce your building’s emissions?

The Climate Mobilization Act was passed for good reason. While it’s easy to focus on the potential financial penalties apartment owners may accrue, there are a variety of very positive benefits for reducing our building emissions, including:

  • Lowering your operating expenses
  • Raising your property value with high-performance equipment
  • Increasing resident satisfaction and reducing turnover by keeping everyone in the building comfy and happy
  • Contributing to a cleaner and healthier community by reducing our carbon footprint

I know what you’re thinking, “This is all great, but how much is all this going to cost my condo or co-op?” We’ve got all the need-to-know information and best next steps to help you financially plan for your building’s energy upgrades. 

Long-term financial planning 

Developing a solid financial plan should be your first order of business. Start laying the groundwork to begin implementing energy-saving upgrades and establish ongoing energy management strategies in your condo or co-op. 

This kind of financial planning can get pretty complicated pretty quickly, even for the most senior finance pros on your building’s board. By partnering with your property management company with expert building financial strategists (like Daisy), you can rest easy knowing you’ve got a knowledgeable team with your best intentions at heart. 

Financing opportunities

While planning, you’ll need to begin researching, reviewing, and comparing different financing opportunities that make sense for your building. There are key differences, features, pros, and cons of each that are important to understand to develop the best energy efficiency strategy for your building. 

PACE (Local Law 96)

Local Law 96, better known as New York City’s PACE program (Property Assessed Clean Energy Financing), allows certain buildings to finance energy audits, upgrades, and improvement projects through a special assessment on their property tax bill. 

1. What are some of the particular benefits of PACE financing?

One of PACE’s defining characteristics is that owners can repay eligible, private loans by including a charge on their building’s property tax bill. Should you qualify, there are a number of benefits you can look forward to, such as:

  • They can fund a wide range of energy improvements, including energy-efficient lighting, HVAC systems, insulation, solar panels, energy audits, and more
  • They aren’t accelerating, which means you’re not required to immediately repay the outstanding principal balance after a payment default
  • Project fees, including closing and service fees, are already included
  • There are immediate cash flow benefits
  • When an apartment is sold, the loan charge will transfer to the new owner
  • These are longterm loans, usually per the useful life of the energy equipment installed (often between 20 and 30 years)
  • They have some of the more competitive interest rates because they’re collected with taxes
  • You're billed quarterly or semiannual, depending on your building’s tax collection schedule

2. Are condos and co-ops eligible for PACE financing?

Since these loans are provided by private lenders approved by New York City Energy Efficiency Corporation (NYCEEC), it really depends on the building. PACE loan repayment is made on the property tax bill. Since NYC condo owners pay their taxes individually, it renders condo buildings ineligible for this loan.

Your property manager should be able to easily determine if you qualify, and if so, partner with the best lender for you. 

3. Are there particular challenges with PACE financing co-ops should know about?

PACE financing can be a bit challenging for co-ops to obtain because buildings with loans (i.e. an underlying mortgage) (see: most buildings) need to get approval from their primary lender (see: highly unlikely).

4. How can condos and co-ops mitigate these challenges?

First things first, connect with your property management company to understand the particular requirements and potential limitations of PACE funding and see if your building qualifies. 

Second, you’ll need to develop a clear communication plan to ensure your owners and stakeholders understand the impact of these new energy laws, the necessary upgrades your building needs, and the custom financial plan to get there so you have full buy-in. You can check out our communication tips here. And finally, be prepared to provide detailed information on your building’s finances and ownership structure when applying.

5. Anything else to know about PACE? 

Yes, here are a few more things to know:

  • PACE can retroactively finance completed energy projects that meet all program guidelines and qualifications
  • There are certain incentives and utility rebates that can be used to offset PACE financing. Ask your property management company to help you understand what you qualify for
  • For more information, you can check out NYC Accelerator and the New York City Energy Corporation (NYCEEC). You can also reach out to us at Daisy - we’re happy to answer any specific questions you may have


The New York State Energy Research and Development Authority (NYSERDA) is on a mission to advance energy innovation, technology, and investment. They provide funding, technical expertise, and support in New York to meet energy and climate goals. 

1. What are some NYSERDA loan options condos and co-ops can take advantage of?

NYSERDA wants you to choose greener energy, from solar solutions to clean heat, and so much more. To help you out, here are a few of the different loan options NYSERDA offers:

  • On-Bill Recovery Loans: Loans that allows you to manage installation costs by including them as line items to your monthly utility bill
  • Smart Energy Loans: Traditional loans that you repay monthly
  • Renewable Energy Tax Credit Bridge Loans: Short-term loans that enable you to use federal tax credits, state tax credits, and property tax abatements for eligible renewable energy solutions
  • Companion Loans: Traditional loans that can be used with either an On-Bill Recovery Loan or Smart Energy Loan to access additional financing for projects that exceed $25,000

2. What’s the difference between PACE and NYSERDA?

PACE is a financing model that helps owners finance energy efficiency and renewable energy upgrades to their properties through a special assessment on their property tax bill. NYSERDA, on the other hand, is a state-sponsored public benefit corporation that provides funding, technical expertise, and support for clean energy projects throughout New York. While the two are not connected, PACE and NYSERDA can be used together to help condos and co-ops finance their clean energy projects. 

Additional funding opportunities

Don’t sweat if PACE and NYSERDA aren’t the best fit for your building! There are several other energy financing options to consider to help bring your condo or co-op up to code.

  • Energy efficiency loans: Many banks and credit unions now offer energy efficiency-specific loans that are specifically for energy efficiency upgrades. Check with your property management company to see what makes sense for your building
  • Energy service agreements: Energy service companies (ESCOs) provide custom service agreements that fund energy efficiency upgrades in exchange for a portion of the energy savings 
  • Grants and incentives: Don’t sleep on these money-saving opportunities, including rebates for installing energy-efficient appliances or equipment, tax incentives for energy-efficient improvements, or grants for renewable energy projects
  • Community solar programs: For those who can’t afford solar panels on their own, these community programs allow residents to invest in a shared solar installation and receive credit on their utility bills for the energy produced
  • Multifamily Green Loan: This new kid on the block can help condos and co-ops pay for different projects with environmental benefits, including solar panels, roof and building envelope upgrades, electrification, battery storage, windows, and other energy retrofits

Final thoughts

When it comes to Local Law 97 compliance, there are a number of financing options at your fingertips. But, you have to know where to look, understand what’s best for your building’s needs and structure, and how to best plan ahead. Having the right team of advisors, financial experts, and energy consultants on your side will make all the difference on your path to greener living. As the only tech-driven full-service condo and co-op management company, Daisy is here to help move your building forward. If you have any particular questions or concerns, we’re always happy to help. 

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