Condominiums Must Abide by Denver’s New Benchmarking Ordinance

In an effort to preserve integrity, quality of life, and strengthen the local economy the Denver Department of Public Health and Environment established an Energy Efficiency Program. An integral part of this Energy Efficiency Program is the county’s new Benchmarking Ordinance. The ordinance is sited in the Denver Revised Municipal Code, Chapter 4, Article V. Energy Efficiency in Commercial and Multifamily Buildings. The ordinance requires covered buildings over the size of twenty-five thousand (25,000) square feet to report their annual energy usage to the department.

The intent of the ordinance is to stimulate transparent and responsible energy practices, encourage reductions in energy consumption, and further progress Denver’s 2020 Sustainability and Climate Action Plan goals of reducing greenhouse gas emissions below 1990 levels by 2020.

Many other cities around the US have adopted similar policies in an effort to combat the detrimental effects of human impact on natural ecosystems. Unfortunately, the language of Denver’s ordinance is vague in comparison to the others like it. Therefore, careful examination of the text is essential before reporting.

The ordinance defines “Benchmarking” as “measuring a covered building’s energy performance using the ENERGY STAR Portfolio Manager tool.” The ENERGY STAR Portfolio Manager is an online tool that was developed by the US Environmental Protection Agency in an effort to assist people with measuring and tracking their energy use, water consumption, and greenhouse gas emissions. The tool is widely utilized, recognized in the marketplace, and free of charge.

Denver County has continued to expand enforcement of the rule over the last several years.  Initially, only Municipal buildings were required to comply. In 2017, all commercial and multifamily covered buildings greater than fifty thousand (50,000) square feet were required to comply. This year, in the final phase, all commercial and multifamily covered buildings greater than twenty-five thousand (25,000) square feet must comply with the ordinance. All covered entities must report by June 1 each year.

There are stiff penalties for non-compliance with the ordinance. If a covered entity fails to comply with the ordinance, fails to correct and resubmit errors in reporting, or violates any provision of the ordinance such failures may result in a civil penalty of not more than two thousand dollars ($2,000) per violation, per day assessed against owners.

Under the authority of the Denver Revised Municipal Code, Chapter 4, Sections 4-6 and 4-54, the Board of Public and Environmental Health established a final rule governing the ordinance. The rule was adopted on February 9, 2017. The rule details the logistics of benchmarking those items which should be included with the final report, data verification requirements and clarifies the duties of the owner.

For condominium associations, it is the board’s responsibility to Benchmark and properly report to the department to remain compliant with the ordinance. This includes, but is not limited to the management of the ENERGY STAR account, measurement of the interior spaces as instructed by ENERGY STAR, conversion of energy data to instructed metrics, assembly of all relevant data and statements from all utility vendors(electric, gas, and water), completion of any required tenant release forms, accountability for data being reported true and accurate, storage of all relevant data and release forms for inspection and data verification purposes, and ensuring that compliance is complete by June 1 each year. Certain scores or building dimension discrepancies may result in the department requiring the owner to obtain an engineer review and report, then resubmit the score along with the report. In this case, the owner is responsible for notice of resubmittal.

As mentioned above, it is mandatory that each owner shall securely store all records of monthly energy consumption for a minimum of twenty-four (24) months; although, it is not necessary to report these records. All relevant records shall be available for the department’s inspection upon request. Additionally, the final rule asserts that all data required to generate the ENERGY STAR score is to be stored and available for inspection for no less than five (5) years.

If you are a member of a condominium association, or the owner of a commercial building, then you may want to familiarize yourself with the ordinance text, final rule governing the ordinance, ENERGY STAR’s definitions and measurement procedure, potential penalties, or consult with an attorney for precise analyzation and interpretation of your responsibilities, rights, and liabilities.

If you have questions or need help, please contact Damien Bielli at 720-943-8811, or Damien.Bielli@vf2022.webuponstaging.com. Damien has been practicing law for nearly twenty years and has extensive experience in Homeowners’ Association Law, Corporate Law, Civil Litigation, and more.

(Ord. No. 1231-16, § 2, 12-19-16)