Climate Exactions: One Tool in a City's Toolbox

• Date: 01 August 2017

8-2017 NEWS & ANALYSIS 47 ELR 10675

C O M M E N T

Climate Exactions:

One Tool in a City’s Toolbox

by Adam Freed and Jake Elder

Adam Freed leads Bloomberg Associates’ Sustainability Practice and is a lecturer at Columbia

University. Jake Elder is a manager with the Bloomberg Associates Sustainability Practice, where he

works with mayors and other city leaders to advance priority sustainability initiatives.

I. The Role of Cities in Addressing

Climate Change

Climate change is a real a nd present da nger that must be

aggres sively addressed to protect people, ensure economic

growth, and preserve our natural systems. Reducing

greenhouse gas (GHG) emissions and protecting com-

munities from nat ural haza rds requires rethinking every

facet of the built environment. From where and how we

build, to how we gener ate energy a nd move goods a nd

people, to how we integrate nature into our cities, we

must fundamentally cha nge our approach to develop-

ment and inf rastr ucture i nvestments. Local governments

are a critical player in this eort.

Local governments—particula rly cities—have ma ny of

the tools and powers

needed to cut carbon

emissions. A report

by the National

Laboratory for

Renewable Energy

(NREL) estimates

that cities can con-

tribute approxi-

mately 15–35%

of the remaining

carbon reductions

needed to achieve

the U.S.’s COP21

target.1 Local gov-

ernments are also

on the frontlines of

responding to cli-

mate hazards when

they occur and have

a tremendous stake in reducing climate risks. Cities have

also demonstrated a willingness to take action on climate

1. E O’S  ., E  N C A-

 P  C P: A D-D A vi (Na-

tional Renewable Energy Laboratory 2016), http://www.nrel.gov/docs/

fy17osti/67101.pdf.

change; more than 130 U.S. Mayors have signed on to the

Global Covenant of Mayors, committing their cities to

take action to reduce carbon emissions.

J. Peter Byrne and Kathryn Zyla oer an intriguing new

mechanism for municipalities to address climate change.

ey propose t hat local governments lev y a climate exac-

tion, or fee, on new developments to oset the increased

GHG emissions or climate risks caused by the new devel-

opment. is fee is modelled on exactions commonly used

to mitigate issues such as trac congestion or infrastruc-

ture needs. Following legal precedent, climate exactions

would need to be “roughly proportional” to the impact of

new development and used to f und actions t hat have an

“essential nexus” to oset the harm caused by the develop-

ments to which they are applied.2

2. As outlined by Byrne and Zyla, the courts have ruled that exactions must

meet two critical thresholds to be legal: they must “have an ‘essential nexus’

with a public harm justifying regulation” and “the value of the property

exacted be ‘roughly proportional’ to the degree of harm threatened by the

proposed development.” See Dolan v. City of Tigard, 512 U.S. 374 (1994)

(establishing rough proportionality requirement); Nollan v. Cal. Coastal

Comm’n, 483 U.S. 825 (1987) (establishing “essential nexus” requirement).

The National Renewable Energy Lab estimates that city actions could account for 15-35%

of the GHG reductions necessary for the U.S. to meet its Paris Climate Commitments

Reduction s Needed to Mee t U.S. Paris Cl imate Commit ments

NREL Modera te Abatement Sc enario

Source of Cit y Emissions R eductions

NREL Modera te Abatement Sc enario

Public Transit

Building Ene rgy Codes

Municipal Ac tions

Solar PV Polici es

Smart Grow th

Building Ene rgy Incenti ves

Potential

Emissions

Reduction s

from Cities

Emissions

Reduction s

Needed from

Other Sourc es

Source: Bl oomberg Associates ( based on data from ERIC O’ SHAUGHNESSY ET AL ., ESTIMATIN G THE NATIONAL CAR BON ABATE-

MENT POTENTIA L OF CITY POLIC IES: A DATA-DRIVE N APPROACH (Nat ional Renewable Energ y Laboratory 2016)).

Copyright © 2017 Environmental Law Institute®, Washington, DC. Reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.