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Multifamily Apartment Policy Changes in 2022

How do you keep up with the constantly changing face of Property Management? Last year’s multifamily apartment policies and procedures quickly become outdated as law makers and municipalities try to balance what’s ethical and unbiased for taxpayers, business owners, and our planet.

Renters’ lives are at stake when we evaluate our compliance with Health & Safety policies. The future of the earth is at jeopardy if we ignore the impact our homes have on the environment. And somehow, we’re still expected to run financially lucrative operations while finding stability amongst the many sides of issues impacting our livelihood.

While MDU legislation varies greatly from state to state, and even city to city, we thought it would be worthwhile to take a look at a few of the major multifamily apartment policy changes in 2022.

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Natural Gas Bans in Multiple States

California is certainly leading the pack when it comes to natural gas bans. In 2019, Berkeley was the first city in America to take the initiative and mandate these more sustainable options for energy consumption in regards to real estate development. Since then, 77 cities in 10 states have followed suit.

Without much legislation on the subject at a national level, many environmental advocates consider natural gas bans to be one of the most simple and obvious steps States can take toward reaching net-zero emissions. But in opposition, 20 US states have actually enacted laws which forbid the bans.

It’s not only properties in California that should be watching how the energy debates unfold. Gov. Kathy Hochul of New York is pushing forward in 2022 with what may become America’s first statewide gas ban for new buildings. New York City already passed legislation in 2021 that set motion to ending fossil fuel use in new construction. 

Property Managers and MDU Developers should weigh the risks and rewards presented by each energy option. Depending on how likely your state is to favor electric over gas in the coming years, you may want to lead the shift in switching to cleaner power now rather than be forced to make the change at a later date. 

Induction ranges can replace gas stoves, and electric heat pumps can warm homes. It’s not too inconceivable to imagine a future where solar and wind power are the mandatory solutions to operate our properties. With this trend already finding its way into the most progressive States’ plans for a greener future, it will require a transition based on electrical fit-outs instead of gas.

2022 New York City Fire Code Upgrades

With a population of 8.85 million, NYC isn’t just a trailblazer in natural gas policies, they have a massive amount of renters to protect, and this year marked a significant update to safety and property management practices with the 2022 New York City Fire Code. A 21-page document outlines the most significant amendments from the previous 2014 code.

Here are some items MDU Property Managers may want to pay extra attention to with respect to New York City renter rights, landlord responsibilities, and fire safety.

  • Revised plan/staffing/filing requirements for emergency preparedness plans to distinguish between high-rise/large-area buildings with staged evacuation and those without.
  • Requires fire drills in high-rise megastructures.
  • Requires co-op/condo residents to cooperate with fire safety notice enforcement.
  • Clarifies requirements for rooftop access and rooftop landing areas to facilitate firefighting operations.
  • Requires identification of the apartment or dwelling unit served by gas meters, by signs or markings, to facilitate firefighting operations.
  • In regards to mandatory self-closing doors; the fire department shall develop a process, to be implemented by July 1, 2023, to periodically inspect certain self-closing doors in class A multiple dwellings.

Competitive Broadband Access to Multiple Tenant Environments

In February 2022, the American Federal Communications Commission (FCC) had consumers (and more specifically renters of multi-dwelling units) in mind when they passed a new order outlining a revamped policy for broadband deals. By regulating what types of arrangements landlords and internet service providers can enter into, the FCC aims to eliminate unfair competition.

The FCC holds the opinion that tenants should not be at the mercy of a single telecom company to dictate the price of their internet connection without access to alternatives. One common practice among property managers no longer accepted as fair game are revenue sharing agreements. The Commission defined revenue sharing agreements as “contracts between MTE owners and service providers where the owner receives consideration from the communications provider in return for giving the provider access to the building and its tenants.”

This new order translates into renters having the right to connect to the internet using any business actively serving their area. Property Managers should also ensure they do not strike agreements with communication service providers who promise to pay MDU owners on a “graduated basis,” meaning your commission grows along with the number units you convince to sign up as the telecom company’s customer.

Biden’s Inflation Reduction Act Incentivizes Energy Reform

The Inflation Reduction Act (IRA) was signed into law on August 16, 2022, and is expected to have a significant impact on commercial real estate.

If you’re a Property Manager or MDU Developer, much of the legislation you may find most relevant is related to rebates and tax incentives for green construction materials. In addition, the act promotes energy efficiency in both multi-family and single-family homes.

Under the IRA, large multifamily residential buildings are eligible for $2,500 in credits per unit to align with ENERGY STAR standards. Or $5,000 per unit for achieving DOE zero energy compliance. The previous law only granted this credit for multifamily buildings of three stories or less, but the updated policy is open to all multifamily buildings at $2,500/$5,000 per unit if certain wage requirements are met.

“The National Apartment Association (NAA) and National Multifamily Housing Council (NMHC) have long called for retrofits with energy savings measured against an existing building’s baseline energy usage to be eligible for the credit” reports the site’s summary of the IRA. So Property Managers may also be celebrating the updated benefits for modifying a premise with energy efficient infrastructure.

What’s your plan to stay on top of MDU policy changes?

The types of policy changes Property Managers need to keep informed on come from many different departments and sources. The NAA State Legislative Tracker does a great job of consolidating legislation revisions throughout America for people in the apartment and real estate business. From resident screening topics, to laws about eviction and taxes, you could bookmark this resource for future reference.

Multi Family Apartments that adopt Smart Living technology tend to have an easier time managing compliance. By connecting and monitoring the electronic systems in use at your property – reporting, tracking and preventative maintenance become less time consuming. Building codes and fire policies require access control components that LocklyPro specializes in. Eliminate the error-prone manual processes that could cause fines, complaints, or damaging mistakes.

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