Issue Overview
In January 2024, Mayor Brandon Johnson’s office released the details of the proposed Clean and Affordable Buildings Ordinance (CABO). This issue was carried over from the previous administration under former Mayor Lori Lightfoot. As early as 2021, the city began working on this issue and formed a working group to determine the pathway for reducing carbon emissions in buildings.
Highlights of the Ordinance
- Applies to new construction only.
- While it doesn’t specifically require “electrification” in new construction, it sets an indoor emissions standard prohibiting the combustion of any substance that emits 25 kilograms or more of carbon dioxide per million British thermal units of energy. This combustion limit permits the use of zero or low-carbon emission technologies, including building electrification, while limiting the use of fossil-fuel-based appliances and systems.
- Some exceptions are allowed including but not limited to emergency backup power, industrial production, hospitals, research and teaching labs, and commercial cooking equipment.
- It applies to existing buildings if an addition is added that is greater than 10,000 square feet or 25% of the building.
- If adopted, effective immediately.
Legislative Outlook
In early April, the Environmental Protection and Energy Committee held a subject matter hearing for the public and City Council members to hear arguments for and against the ordinance. No votes were taken during the hearing; however, several perspectives were offered including a joint resolution to bring more organizations to the table.
Alderman Gil Villegas (36th Ward) introduced a resolution that would move alongside CABO should it pass. The intent of the resolution would allow the real estate industry (REALTORS® included) to guide a study on the impact of a potential shift of costs onto households. As costs for homes still using natural gas, there could be a shift to pay for gas utilities. The resolution argues that cost shifts may fall on fewer and fewer consumers resulting in a possible increase that could be overly burdensome for lower-income households not using all electric. By the end of 2024, all negotiations were stalled specifically for the CABO. However, it does not mean that the issue will not evolve and we may see new legislation introduced with a different approach to reducing carbon emissions.
REALTOR® Stance
The real estate industry has not waited for building mandates from the city to support efforts to decrease carbon emissions. In fact, REALTORS® have supported efforts to educate property owners on how to decrease carbon emissions for many years. REALTORS® supported Cook County leaders when they adopted a property tax incentive for commercial owners installing solar panels. And the REALTORS® have been heavily involved at the federal level for support of rebate programs for property owners installing energy efficient systems (Inflation Reduction Act).
REALTOR® staff asked the city to ensure that the permitting process for any decarbonization effort for new construction or renovation (ex. Installation of solar panels for existing buildings) is fast and efficient.
In 2022, the Inflation Reduction Act (IRA) was signed into law by President Joe Biden. This law represents the “most ambitious climate action in history” by bringing tens of millions of dollars to make homes more energy efficient. The National Association of REALTORS® Sustainability Advisory Group has actively participated in encouraging states to apply for grant funding made available through the IRA.
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