Sunday, July 29, 2018

BOMA California Advocacy Update: Mandatory Benchmarking Law; Two BOMA California Sponsored Bills Signed by the Governor

California Mandatory Benchmarking Law - AB 802

California’s mandatory commercial building benchmarking law is one of the topics we are contacted about the most and since the law finally went into place on June 1, of this year, the amount of questions we have received have spiked dramatically.

Because of the increase in interest (and the fact that many of your buildings must comply with the law) we thought now might be a good time to re-present information on this topic to help our members understand the process and how to comply.

It all started in the year 2007 with AB 1103, a bill that passed the Legislature and was signed into law by then Governor Schwarzenegger, over our industry’s strenuous objections. We weren’t opposed to benchmarking, per se, but believed the way the bill was going to be difficult to implement in that it required every non-residential building in the State of California to be benchmarked. Period. No flexibility.

Our warnings that such a sweeping mandate would be an overwhelming regulation to implement came to fruition and after several years the complicated process was abandoned, and stakeholders were brought together to start over and write a statute – that retained the “mandate” but did so in a manner that could actually work in the Real World.

The result was that in 2015 the original statute placed on the books by AB 1103 was repealed and new, more flexible statutory language was signed into law by Governor Brown in the form of AB 802. That bill re-calibrated the regulatory process and addressed a number of complaints our industry has had with the original law:

  • AB 1103 mandated ALL buildings must be benchmarked regardless of size or use; AB 802 states that buildings 50K s.f. and above must be benchmarked and allows the Energy Commission some discretion to exempt certain building types and situations (i.e. the CEC could decide that long-term empty buildings or buildings scheduled for razing need not be benchmarked).
  • AB 1103 was a transaction based program – benchmarking was triggered by a sale/lease of whole building/refinance. The transaction based approach had many unintended consequences such as requiring actively managed buildings to be benchmarked more often than buildings that are not; put an unnecessary technical process in the middle of a real estate transaction; and required benchmarking be provided to parties that were not making management decisions (i.e. lenders); AB 802 allows the CEC to determine the best trigger for benchmarking – that could be transaction based or time certain (i.e. once every two years).
  • Under AB 1103 many building owners were unable to get tenant energy information from local utilities; AB 802 clarifies that utilities are required to provide information; in an aggregated format if there are privacy concerns in multi-tenant buildings. Although some building owners are currently having trouble accessing this information from some utilities the law is clear that owners do not need to get permission from tenants and/or utilities for these purposes.
  • AB 1103 treated income producing properties separately by only focusing on commercial; AB 802 – with the support of the Apartment industry - includes certain multi-family housing properties.

Our industry was also given two years to prepare for implementation as reporting did not begin until June 1, 2018.

Now that the implementation phase is underway the rule of thumb is that, with some exceptions, if you have a building that is 50K s.f. or more you must benchmark it annually using Energy Star and report the numbers. See below for more info.

California Mandatory Benchmarking Law - Resources

With a few exceptions, if you have a building that is 50K s.f. or more you need to benchmark it annually using Energy Star and report numbers to the Energy Commission. Our industry has worked with policymakers and regulators all along the process to provide input that will hopefully make compliance for a vast majority of our members relatively simple.

However, we know some situations may not go smoothly or may present unique questions that require more information. Below are links that we hope will help.

  • Detailed information about the Building Energy Benchmarking Program including fact sheets and frequently asked questions are on the CEC's benchmarking website.
  • Several webinars for different stakeholders have been held. Here are links to recordings of each webinar:
CEC AB 802 Building Owner & Representative Stakeholder Webinar

CEC AB 802 Public Agency Stakeholder Webinar

CEC AB 802 Utility Stakeholder Webinar

CEC AB 802 Energy Consultant Stakeholder Webinar

We hope that one or all of these resources can help those companies that are having trouble implementing the law. For additional information or questions, please contact the Benchmarking Hotline at (855)279-6460 or

SPONSORED BILL SIGNED INTO LAW: AB 2173 – Abandoned Property

Sponsored by BOMA California and signed into law by Governor Brown in July, this bill updates the state’s commercial/retail abandoned property laws by increasing the threshold amount needed to trigger an official disposition (auction) process. The new threshold is now $2,500 or an amount equal to one month’s rent for the premises the tenant occupied, whichever is greater.

Under current law, a commercial property owner/manager is obligated to go through an expensive public notification and auction when a business moves out and leaves behind unwanted items, believed to be $750 or more in value or the equivalent of $1 per square foot of the rental for the property, whichever is less.

If a company moves out of a leased space and purposefully abandons property (i.e. old shelving, a few desks and chairs, or obsolete computer equipment) that low threshold is very easily met and triggers an expensive auction process for a relatively small amount of money on items that were unwanted to begin with.

Due to AB 2173, state law now better reflects the practical realities in the commercial real estate industry by setting a new commercial threshold. This proposed new threshold amount more appropriately aligns with the actual costs of storage and disposal of abandoned property in commercial real estate.

AB 2173 (Santiago; D-Los Angeles) Governor’s Signature Press Release and Click here to read the text of the new law.

SPONSORED BILL SIGNED INTO LAW: AB 2847 (Rubio; D-Baldwin Park) – Separating Residential and Commercial Leasing Language

Sponsored by BOMA California and signed into law by Governor Brown in July, this bill continues the effort to separate commercial from residential sections in statute where it does not make sense to have them intermingled.

AB 2847 clarifies that current Civil Code §1951.3 pertains to residential real estate only and creates a new section mirroring it to deal with commercial/retail. This fix was needed as the statute provided certain obligations/protections for residential owners/tenants without parallel in commercial context.

The current section requires that when property is deemed “abandoned” the property owner must wait until the fifteenth of the following month to start the Notice of Abandonment. This waiting period does not make sense on the commercial side as there are strict contractual obligations guiding property leases. This bill clarifies that the residential and commercial sections are not comingled which may lead to further reform in the future.

AB 2847 (Rubio; D-Baldwin Park) Governor’s Signature Press Release and click here to read the text of the new law.

Friday, July 27, 2018

BOMA International Advocacy Update: ENERGY STAR® Preserved in Appropriations Bills

ENERGY STAR® Preserved in Appropriations Bills

In a recent legislative victory for BOMA, both the House of Representatives and Senate Appropriations Committees passed their Interior, Environment and Related Agencies 2019 Appropriations Bills. Included in the bills, and accompanying report language, is funding for the ENERGY STAR® program, which includes the popular Portfolio Manager® tool.

Previously, the Trump administration called for the elimination of ENERGY STAR and later for the program to be funded as a user-fee system. BOMA opposed both proposals and vigorously defended the merits of ENERGY STAR and called on Congress to preserve funding for this important program.

Our efforts have proved successful, and language was inserted in the appropriations report to preserve the program and continue funding at its current level. The bills will now go to the full House and Senate for a potential floor vote. We will continue to advocate for the program as the process moves forward.

Wednesday, July 25, 2018

BOMA California Advocacy Update: Proposition 65 Requirements Webinar - Updates Take Effect on August 30, 2018

The Office of Environmental Health Hazard Assessment’s (OEHHA) recent update to the Proposition 65 warning regulations take effect on August 30th of this year. The new warning regulations substantially change what warnings must say and how they must be presented to the public or consumers.

A section of the new regulations provide guidance for the type of warnings that would need to be provided at the entrance of commercial buildings, including warnings that must specify the chemical for which the warning is being provided.

The regulations also speak to other type of exposure scenarios they may be relevant for commercial buildings, including food warnings, parking lot warnings, and others.

On Friday, August 10th, 10:00 a.m., BOMA California will host a webinar with Anthony Samson and Tiffany Ikeda, attorneys with Arnold & Porter, and Proposition 65 compliance experts, to walk through the new requirements.

BOMA California Proposition 65 Compliance Webinar
Friday, August 10, 10:00 a.m.

Proposition 65 is a complicated area of law and your properties are all unique. With that in mind we highly recommend that you work with internal legal resources or an external firm that can provide guidance to assure you are in full compliance.

However, we hope this webinar will give you some basic tools to accomplish the goal of Prop. 65 compliance.

Additionally, BOMA California has also worked with Arnold Porter to produce this Prop. 65 Guidance document to provide you some basic information and get you pointed in the right direction.

San Francisco Accessible Business Entrance Program - Changes to the Measure Effective as of June 1, 2018

The Accessible Business Entrance program helps property owners comply with state and federal accessibility laws and helps people with disabilities gain greater access to goods and services offered by businesses in San Francisco. Passed by the Board of Supervisors in 2016 (Ordinance No. 51-16), the ordinance requires that existing buildings with a place of public accommodation have all primary entrances accessible for people with disabilities.

Under state and federal law, a place of public accommodation is generally a business where the public will enter a building to obtain goods and services, such as banks, day care centers, hotels, offices, restaurants, retail stores, et cetera.

The following changes to the measure are now effective as of June 1, 2018. 
  • Extend all compliance deadlines by six-months resulting in the first deadline of January 1, 2019.
  • Eliminate the administrative fee of $97.
  • Require property owners to provide a 30-day notice to building tenants prior to filing the permit application.
  • Qualify buildings under Category 1, if any of the following descriptions apply:
    • building owners mandated to meet earthquake retrofit electing to comply with this ordinance’s requirements prior to this Program’s compliance deadlines.
    • building owners fi ling a permit application on or after the effective date of this ordinance to alter a building or a portion thereof was altered, or is proposed to be altered, with the owner electing to comply with this ordinance’s requirements prior to this Program’s compliance deadlines.
 For more information, please visit

Monday, July 23, 2018

BOMA International's Political Action Committee (BOMAPAC) Needs Your Support

BOMAPAC is BOMA International’s political action committee. It enables BOMA International’s advocacy team to raise money to re-elect political candidates for federal office who know and understand – and support – commercial real estate issues.

Whether or not you are politically aware, there is no better way to support the candidates and the issues that impact your professional and personal lives. Your contribution, combined with the donations from your BOMA colleagues from across the U.S., will help ensure that BOMA International has the power to back those members of Congress who show leadership and commitment to commercial real estate issues. So let your voice be heard!

Help BOMA San Francisco Advocacy Leader, Jim Collins (pictured above), as he leads the effort for BOMA San Francisco to ensure that congressional seats are held by individuals who understand real estate’s issues and challenges and can have a positive impact on your livelihood.

Can we count on you to send a check or fill out this form with your credit card information? Members typically donate $100 to $250, but any amount would help the cause. Checks or credit card information should be sent to:

BOMA San Francisco
Attention to: John Bozeman (
233 Sansome Street, Suite 800
San Francisco, CA 94104

Your support of the BOMA International PAC enables them to pursue their vital effort to protect and enhance our industry in the following ways:
  • BOMAPAC is the only voice solely representing multi-tenant office building owners and managers in Washington, DC.
  • BOMA has been the lead organization in pressing for a permanent 15 year Leasehold Depreciation schedule with Congress.
  • BOMA has been a key leader in promoting tax credits for energy efficiency upgrades to commercial real estate.
  • BOMA was one of the key groups who lobbied Congress to renew the Terrorism Risk Insurance Act coverage for commercial property owners, which was recently passed.
  • BOMA continues to lobby to retain the so-called carried interest tax obligation on real estate developments as a capital gains tax item rather treating it as ordinary income. 
  • BOMA International is the only commercial real estate organization that is active and effective in the international building codes writing and adoption process. New codes or amended existing codes can have a huge and long-lasting impact on our industry.
*Federal law requires political action committees to report the name, mailing address, occupation and employer of each individual who contributes in excess of $200 in a calendar year. Contributions are not tax deductible. Corporate contributions or contributions by foreign nationals are prohibited.

Thursday, July 19, 2018

RESULTS: BOMA SF-PAC Voter Guide for the June 5, 2018 Election

BOMA San Francisco's Political Action Committee's Voter Guide
June 5, 2018 Election Results

BOMA San Francisco has an active Political Action Committee (BOMA SF-PAC) that campaigns for candidates and issues that promote the economic vitality of the industry and the City and County of San Francisco. Here is a brief report of results of the June 5th election.

The recent June election in San Francisco was contentious. Arguably, there hasn’t been such an acerbic election season quite like this in decades – maybe even in the City’s history. There was an unexpected Mayor’s race, two massive tax measures on the ballot targeting our industry, and a decisive supervisorial race in District 8. Thanks to the leadership of the BOMA San Francisco’s Political Action Committee (BOMA SF-PAC), your interests were well represented during what can only be described as a chaotic period in San Francisco. 

If you have any questions, John Bozeman, BOMA San Francisco's Director of Government and Industry Affairs, at


San Francisco

WON Mayor – London Breed
LOST Board of Supervisors, District 8 – Jeff Sheehy


WON Governor - Gavin Newsom
WON State Assembly District 17 – David Chiu
WON State Assembly District 19 – Phil Ting
WON State Board of Equalization District 2 – Malia Cohen


WON US Senate - Dianne Feinstein 
WON US Congressional District 12 – Nancy Pelosi
WON US Congressional District 14 – Jackie Speier 

Local Propositions

  • PASSED Proposition A - Charter Amendment: Revenue Bonds for Public Utilities Commission Clean Power, Water, and Clean Water Facilities
    • Authorizes the SFPUC to issue revenue bonds for power facilities when approved by ordinance receiving a two-thirds vote of the Board of Supervisors. Amends the Charter to allow the SFPUC to finance new power facilities that increase delivery of energy.
    • This amendment to the City Charter gives almost unlimited power to the PUC and Board of Supervisors for revenue bonds to be issued, without voter approval, to replace or expand the city’s electrical power systems. This authority could be used later to bypass existing bond measure ballot requirements in order to construct competing power systems, an action San Francisco voters have rejected before.
  • PASSED Proposition B - Charter Amendment: Appointed Board Members and Commissioners Seeking Elective Office
    • A Charter amendment requiring appointees on San Francisco boards and commissions to give up their seats when running in state or local elections, a common practice in the past that helped prevent appointed office-holders from enjoying unfair advantages.
  • PASSED Proposition C - Ordinance: Tax on Commercial Rents to Fund Child Care and Education.
    • .5% additional GRT on leases of commercial space; 1% on warehouse space
      • Estimated to raise $146 million annually;
      • Funds early child care and education;
      • Tax would not apply to gross receipts from leases that have the following uses: industrial, arts, or non-formula retail, non-profit and small businesses;
      • Requires 50% + 1 voter approval to pass;
  • FAILED Proposition D - Ordinance: Additional Gross Receipts Tax on Commercial Rents for Housing/Homeless
    • 1.7% additional GRT on leases of commercial space
      • Estimated to raise $70 million annually;
      • Funds low/middle income housing and homeless services;
      • Tax would not apply to gross receipts from leases that have the following uses: PDR, retail and services, entertainment, arts and recreation, non-profit and small businesses;
      • Requires 67% voter approval to pass;
  • PASSED Proposition E - Referenda: Repeal of Ordinance Banning the Sale of Flavored Tobacco Products
    • This referendum suspended an ordinance passed by the Board of Supervisors banning sales of flavored tobacco products. The ordinance was supported by healthcare organizations and opposed by small business advocates. A coalition opposed to the ordinance collected signatures to put this referendum on the ballot. A ‘yes’ vote is a vote to keep the ban on sales of flavored tobacco products in place; a ‘no’ vote is a vote to repeal the ban and allow sales of flavored tobacco products.
  • PASSED Proposition F - Ordinance: City-Funded Legal Representation For All Residential Tenants in Eviction Lawsuits
    • “No Eviction Without Representation Act”
    • This voter initiative requires the Mayor’s Office of Housing and Community Development to create a program that provides legal services for residential tenants facing eviction. These matters are best addressed legislatively rather than by the ballot. Legislation to implement such a policy is pending at the Board of Supervisors.
  • PASSED Proposition G - Ordinance: Parcel Tax for San Francisco Unified School District (Teacher Salaries)
    • “Living Wage for Educators Act of 2018”
    • San Francisco Unified School District parents and the teachers union collected signatures to place this parcel tax on the ballot to fund a 2% salary increase for teachers following a three year, 11% increase approved last November. If passed, the $298 per parcel tax would appear on property tax bills starting July 1 of this year. Increasing salaries may help reduce a teacher shortage but the additional tax may be burdensome to some San Francisco businesses and residents.
  • FAILED Proposition H - Ordinance: Use of Tasers by San Francisco Police Officers
    • “The Safer Policing Initiative”
    • This initiative ordinance authorizes the San Francisco Police Department to train and deploy officers to use Tasers as a non-lethal alternative to firearms. Most big-city police departments equip officers with Conductive Energy Devices (CEDs), including Tasers. While the Police Commission has approved a taser policy, it places unreasonable limitations on their use and has yet to be implemented.
    • BOMA San Francisco has supported providing our City’s law enforcement professionals with all tools and equipment that helps them to protect public safety.
  • FAILED Proposition I - Declaration of Policy: Relocation of Professional Sports Teams
    • “Thou Shall Not Covet” other cities sports teams.
    • A non-binding Declaration of Policy that aims to discourage the Golden State Warriors from moving from Oakland to San Francisco next season. This last-ditch demand won’t stop the move or prevent other sports teams from relocating as they choose.
  • PASSED Regional Measure 3
    • Toll revenues would be used to finance a $4.45 billion slate of highway and transit improvements in the toll bridge corridors and their approach routes.
    • If approved by a majority of voters in San Francisco, Alameda, Contra Costa, Marin, Napa, San Mateo, Santa Clara, Solano, and Sonoma counties.

Monday, July 2, 2018

Central SoMa Schedule for the Upcoming Adoption Hearings at the Board of Supervisors

Several hearings have been scheduled at the Board of Supervisors in July, both at Committees and at the Full Board:

Date & Time: Monday, 7/9 @ 10:00 a.m.
Legislative Body: Rules Committee (Special Meeting)
Actions Heard:
Central SoMa Plan (Administrative Code amendments only) 
Central SoMa Special Tax District (Special Tax Financing Law Amendments) 

Date & Time: Monday, 7/9 @ 1:30 p.m. (Possible 2nd hearing on 7/16)
Legislative Body: Land Use & Transportation Committee
Actions Heard: 
Central SoMa Plan (Planning Code; Zoning Map; General Plan Amendments) 
Central SoMa Housing Sustainability District 

Date & Time: Tuesday, 7/17 @ 3:00 p.m.
Legislative Body: Full Board
Actions Heard: 
CEQA Appeal 
Central SoMa Plan (Planning Code; Zoning Map; General Plan Amendments) 
Central SoMa Housing Sustainability District 
Central SoMa Special Tax District (Special Tax Financing Law Amendments) 

Date & Time: Wednesday, 7/18 @ 10:00 a.m.
Legislative Body: Government Audit & Oversight Committee
Action Heard: 
Central SoMa Special Tax District (Resolutions of Intention to Establish Special Tax District) 

Dates are subject to change. Please see the relevant hearing agendas for the most current information and to estimate start times, available at: