Montgomery County BEPS Compliance: $500/Day Penalties and What Building Owners Must Do

You own a building over 25,000 square feet in Montgomery County, Maryland? You're subject to one of the most aggressive building performance standards in the country. Bill 16-21 is live, compliance webinars are happening now, and the county is not messing around with enforcement.

The penalty for non-compliance can reach up to $500 per day. Not per year. Per day. That's up to $182,500 annually if you ignore this. And the county has made it clear they will pursue enforcement aggressively. If you haven't started planning, you're behind.

What Is Montgomery County's BEPS?

Montgomery County's Building Energy Performance Standard (BEPS) was enacted in 2021 under Bill 16-21. The program requires large buildings to meet energy performance targets starting with the first compliance period in 2025.

The law covers roughly 1,500 buildings across the county. That's a significant chunk of the commercial and multifamily real estate market. If you own or manage property in the county, there's a good chance you're covered.

The program is modeled after Washington DC's BEPS, which has been running since 2021. The county looked at DC's experience, learned from their rollout, and built a similar framework. That means the enforcement mechanisms are mature and tested. This isn't an experimental policy.

Who's Covered?

The threshold is 25,000 square feet of gross floor area. That's lower than most city-level BPS programs, which typically start at 50,000 square feet. Montgomery County set the bar lower because they wanted to capture more of the building stock.

Covered building types include:

• Office buildings
• Multifamily residential (4+ units)
• Retail and commercial
• Hotels and hospitality
• Warehouses and distribution
• Mixed-use properties

If you're the building owner, you're responsible for compliance. Not your property manager. Not your tenants. You. The fines go to whoever's name is on the deed.

Exemptions Are Narrow

There are a few exemptions, but they're limited:

• County-owned buildings
• Houses of worship
• Industrial facilities primarily used for manufacturing
• Parking structures (standalone, not mixed-use)

If you own a typical commercial building, apartment complex, or retail center, don't count on an exemption. You're almost certainly in scope.

Compliance Periods and Deadlines

Montgomery County's BEPS has rolling compliance periods based on building type and size. The first period started in 2025. If you're covered and you haven't filed yet, you're already late.

How the Periods Work

Buildings are grouped into compliance cohorts based on their characteristics. Larger buildings and higher-emissions property types face earlier deadlines. The county wanted to tackle the biggest energy users first.

You need to benchmark your building, calculate your Energy Use Intensity (EUI), and submit a compliance report showing you meet the performance target. If you don't meet the target, you need to submit a compliance plan outlining how and when you'll get there.

The $500 Per Day Penalty

Montgomery County doesn't play games with enforcement. The penalty for failing to comply can reach up to $500 per day starting from the date you're supposed to be compliant.

Let's do the math. You miss your compliance deadline and let it slide for a year. That's 365 days at $500 per day. You now owe the county $182,500. And that's just year one. The penalties compound every year you remain out of compliance.

The county has enforcement staff dedicated to tracking non-compliant buildings. They send notices, they follow up, and they will pursue collections if you ignore them. This isn't a theoretical penalty. The county has already started issuing notices of violation.

How to Comply

The county gives you a few pathways to compliance. You're not locked into one specific approach. But every path requires real action. You can't just file paperwork and call it done.

Option 1: Meet the EUI Target

Every building type has a target Energy Use Intensity (EUI) measured in kBTU per square foot per year. If your building's actual EUI is at or below the target, you're compliant.

The targets are based on the ENERGY STAR median for each property type. That means roughly half of existing buildings already meet the standard and half need to improve.

To find your building's EUI, you need to benchmark in ENERGY STAR Portfolio Manager. This is the same platform used for benchmarking in NYC, DC, and most other jurisdictions. If you're not familiar with it, now's the time to learn.

Option 2: Submit a Compliance Plan

If you can't meet the EUI target right now, you can file a compliance plan showing how you'll get there. The plan needs to include:

• Current energy use and EUI
• Specific energy efficiency measures you'll implement
• Timeline for completing those measures
• Projected EUI after improvements

The county will review your plan. If it's credible, you'll get a grace period to complete the work. But this isn't a permanent out. You still need to actually do the work and demonstrate compliance in the next period.

Option 3: Demonstrate Alternative Compliance

In limited cases, you may qualify for alternative compliance if you can show that meeting the standard is technically or financially infeasible. Expect the bar for this to be high. The county doesn't want buildings using this as a loophole.

What Building Owners Should Do Now

If you're covered by Montgomery County's BEPS, here's your action plan.

1. Attend a Compliance Webinar

The county's Department of Environmental Protection runs regular webinars explaining the BEPS requirements. These sessions are free, they're informative, and they're your best opportunity to ask questions directly to the people enforcing the law.

Check the county's website for upcoming sessions and register. Bring your property manager, bring your building engineer, and take notes.

2. Benchmark Your Building

Get your building into ENERGY STAR Portfolio Manager and calculate your EUI. You need to know where you stand before you can plan what to do.

You'll need 12 months of utility data for all energy sources (electricity, natural gas, steam, fuel oil, etc.). If you don't have this data organized, call your utility providers now. Some can take weeks to fulfill historical data requests.

3. Compare Your EUI to the Target

Once you have your building's EUI, compare it to the target for your property type. The county publishes these targets on their BEPS website. If you're below the target, great. You're compliant. File your report and you're done for this period.

If you're above the target, you need to make improvements or file a compliance plan. Our free compliance checker can help you figure out exactly where you stand and what you need to do.

4. Get an Energy Audit

If your building isn't meeting the target, hire a professional to conduct an energy audit. You need to know where you're wasting energy and what improvements will have the biggest impact.

Focus on ASHRAE Level 2 audits, which provide detailed analysis and ROI projections for each recommended measure. Audits typically cost $0.10 to $0.30 per square foot, so a 50,000 square foot building might run $5,000 to $15,000.

That sounds expensive until you realize the audit could identify $30,000+ in annual energy savings or help you avoid $182,500 in annual penalties.

5. Prioritize Quick Wins

Not all efficiency measures are created equal. Focus on projects with the fastest payback:

• LED lighting: Still the easiest ROI. Payback periods of 1-3 years are typical.
• HVAC scheduling and controls: Basic building automation can cut energy use 10-20% with minimal capital investment.
• Air sealing: Gaps around windows, doors, and penetrations let conditioned air escape. Cheap to fix, immediate savings.
• Boiler and chiller optimization: Tuning existing equipment often delivers 5-15% efficiency gains with no capital cost.

6. Explore Incentives

Montgomery County and the state of Maryland both offer incentive programs for energy efficiency upgrades. These can cover 20-50% of project costs for qualifying measures.

Check with Pepco, Washington Gas, and the Maryland Energy Administration for available programs. Don't leave money on the table.

How Montgomery County Compares to Other Jurisdictions

Montgomery County's BEPS is one of the more aggressive programs in the country. The $500 per day penalty is higher than NYC's Local Law 97 and on par with DC's BEPS. The 25,000 square foot threshold is lower than most city programs, which means more buildings are covered.

If you own buildings in multiple jurisdictions, you need to track compliance across all of them. Different deadlines, different penalties, different reporting platforms. That's what BPS Check is built for: one tool that tells you where you stand in every jurisdiction.

The Bottom Line

Montgomery County's BEPS is live, enforcement is real, and the penalties are steep. If you're covered and you haven't started planning, you're already behind schedule.

The buildings that act now will avoid penalties, capture available incentives, and get ahead of the contractor availability crunch. The ones that wait will scramble, pay fines, and likely spend more for the same work because every other building owner in the county is competing for the same resources.

Start today. Attend a webinar, benchmark your building, and figure out what you need to do. Use our free compliance checker to see where you stand and what's required.