Over 50 U.S. Mayors Sign Letter to Treasury Urging Simple Direct Pay Guidelines to Accelerate Local Climate Action

Mayors applaud new access to elective pay credits that will turbocharge climate action and environmental justice at the local level

Washington D.C. (August 23) – Over 50 U.S. mayors signed on to a letter expressing appreciation and laying out a set of recommendations to the Department of the Treasury and the Internal Revenue Service (Treasury) regarding a game-changing new program that will allow cities to benefit from clean energy tax credits in unprecedented ways. Elective pay (or direct pay) is a critical mechanism for expanding the clean energy economy, made available by President Biden’s Clean Energy Plan. This new program will allow tax exempt entities – like non profit organizations, state, local and Tribal governments, and rural electric cooperatives – to gain access to credits, which corporations have long benefitted from, for the first time. This offers cities an incredible opportunity to turbocharge local climate action.

Climate Mayors – a bipartisan organization of over 350 mayors – is excited about the opportunity to accelerate local climate ambition and transition to clean energy that this transformative direct pay program presents. This will be the first time these credits are available for city-owned clean energy projects – making projects more affordable for local governments and leveling the playing field between local governments and the private sector. Cities already have ambitious plans for the newly available credits such as: retrofitting for energy efficiency, rooftop solar installation, construction of community resilience hubs in disadvantaged neighborhoods, purchasing and deploying electric vehicles and charging infrastructure, and deploying renewable energy systems like geothermal. 

Making it possible for cities to access certain clean energy tax credits will be sure to move us toward a net-zero economy and help the U.S. meet its Paris Agreement climate goals. However, more clarification is needed before mayors can confidently take advantage of this critical IRA provision. In the comment letter to Treasury, Climate Mayors expressed the need for the agencies to work together to ensure localities understand the full extent that they can access the clean energy credits without being penalized. The reality for many localities is that they are constrained by limited staff capacity and financial resources. The Treasury and Administration must work together to ensure localities don’t miss out on these credits.

Over the last year, cities have already been taking concrete action to fight the climate crisis and build community resilience, but with these supportive elective pay provisions in place, this is just the beginning.

“Allowing cities to utilize elective pay credits can catalyze local climate projects and turbo charge the clean energy economy at a scale that was previously unimaginable,” said Kate Wright, Climate Mayors’ Executive Director. “We thank the Biden-Harris administration for the inclusion of cities in their plans and we hope that further clarifications of the rules will allow local leaders to fully leverage their climate investments.” 

“With investments ramping up in renewable energy, electrified transportation and green jobs, now is a fantastic time for cities to take advantage of elective payment credits,” said Madison Mayor and Climate Mayors Chair, Satya Rhodes-Conway. “Here in Madison, we expect to be able to access over $10 million in credits from projects we already have planned. That will help us invest even more in making our community more resilient, sustainable and equitable.”

In the comment letter, Climate Mayors applauds the Biden-Harris administration for its all-of-government approach to climate action and appreciates the Department of the Treasury and the Internal Revenue Service for recognizing that direct pay will benefit various industries and support economic progress while also reducing multi-sector greenhouse gas emissions.

Climate Mayors feedback and recommendations to Treasury on direct pay includes: 

  • (1) clarifying the timeline between the pre-filing registration process, elective payment election, and when an eligible entity would receive an elective payment; 
  • (2) clarifying eligible entities as it relates to certain agencies and instrumentalities within political subdivisions, such as housing and transit authorities and/or publicly owned utilities; 
  • (3) clarifying eligible projects with the potential for a “pre-approval” process in future iterations of the pre-filing registration process; 
  • (4) clarifying conditions that Treasury would consider a reasonable cause where an entity receives a penalty for excessive payment; and,
  • (5) recommending that Treasury work across agencies to support eligible entities in taking advantage of elective payments.

The letter can be read in its entirety here.


About Climate Mayors:

Climate Mayors is a bipartisan network that has mobilized more than 750 U.S. mayors since 2014, demonstrating climate leadership through meaningful actions in their communities. Representing 46 states and nearly 60 million Americans, the Climate Mayors coalition reflects U.S. cities’ commitment to climate progress. For more information, please visit our website and follow Climate Mayors on X and LinkedIn. For media inquiries please contact climatemayors@fgsglobal.com.


Climate Mayors Elective Pay Feedback Letter

We thank the Department of the Treasury and the Internal Revenue Service (together, Treasury) for providing this opportunity to comment on Treasury’s Notice of Proposed Rulemaking (NOPR or proposed rule)¹ providing additional guidance on the Elective Payment of Applicable Credits established under Section 6417 of the Internal Revenue Code, as added by the Inflation Reduction Act (IRA) in 2022. The undersigned Climate Mayors, a bipartisan network of over 350 Mayors, believe the intentions of elective pay will be truly transformative for cities and appreciate Treasury considering integrating these recommendations into the final guidance.

Read the full letter and recommendations therein here.


Mayor Satya Rhodes-Conway
City of Madison, WI
Climate Mayors Chair

Mayor Kate Gallego
City of Phoenix, AZ
Climate Mayors Vice Chair

Mayor Justin M. Bibb
City of Cleveland, OH
Climate Mayors Vice Chair


Steering Committee Members

Mayor Michael P Cahill
City of Beverly, MA

Mayor LaToya Cantrell
City of New Orleans, LA

Mayor Jane Castor
City of Tampa, FL

Mayor Andre Dickens
City of Atlanta, GA

Mayor Jacob Frey
City of Minneapolis, MN

Mayor Craig Greenberg
City of Louisville, KY

Mayor James Hovland
City of Edina, MN

Mayor Lioneld Jordan
City of Fayetteville, AR

Mayor Indya Kincannon
City of Knoxville, TN

Mayor Lauren McLean
City of Boise, ID

Mayor Jeffrey J. Mims, Jr.
City of Dayton, OH

Mayor Ron Nirenberg
City of San Antonio, TX

Mayor Daniel J. Rickenmann
City of Columbia, SC

Mayor Regina Romero
City of Tucson, AZ

Mayor Lucy Vinis
City of Eugene, OR

Mayor Michelle Wu
City of Boston, MA


Climate Mayors Membership

Mayor Marilyn Ezzy Ashcraft
City of Alameda, CA

Mayor Leirion Gaylor Baird
City of Lincoln, NE

Mayor Lisa Batey
Milwaukie, OR

Mayor Angela Birney
City of Redmond, WA 

Mayor Daniel Biss
City of Evanston, IL

Mayor Rick Blangiardi
City and County of Honolulu, HI

Mayor Noam Bramson
City of New Rochelle, NY

Mayor Paul Brodeur
City of Melrose, MA

Mayor Barbara Buffaloe
City of Columbia, MO

Mayor Daniella Levine Cava
Miami-Dade County, FL

Mayor Paige G. Cognetti
Scranton, PA

Mayor Chance Cutrano
Town of Fairfax, CA

Mayor Gleam Davis
City of Santa Monica, CA

Mayor John Giles
City of Mesa, AZ

Mayor Bruce Harrell
City of Seattle, WA

Mayor Jordan Hess
City of Missoula, MT

Mayor Brandon Johnson
Chicago, IL 

Mayor Cavalier Johnson
City of Milwaukee, WI

Mayor Emily Larson
City of Duluth, MN

Mayor Heidi Leub
City of Tigard, OR

Mayor Matt Mahan
City of San Jose, CA

Mayor Steve Noble
City of Kingston, NY

Mayor John Ortega
Village of Questa, NM

Mayor Shawyn Patterson-Howard
City of Mount Vernon, NY

Mayor Mary Lou Pauly
City of Issaquah, WA

President Senta Plunkett
Village of Wilmette, IL

Mayor Thomas M. Roach
City of White Plains, NY

Mayor Talisha Searcy
City of Takoma Park, MD

Mayor Damon Seils
Town of Carrboro, NC

Mayor Gamal Sherif
Borough of Rutledge, PA

Mayor Christopher Taylor
City of Ann Arbor, MI

Mayor Alan Webber
City of Santa Fe, NM

Mayor Miro Weinberger
City of Burlington, VT


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Statement: Climate Mayors Celebrates the One-Year Anniversary of the Inflation Reduction Act and Looks Ahead to Elevated Climate Action in Cities Across America

One year ago today, President Biden signed the historic Inflation Reduction Act (IRA) into law delivering billions of dollars in grants, incentives, and tax breaks to help make cities more sustainable and equitable. We’re celebrating this year of climate progress by highlighting the hundreds of millions of dollars already won by member cities since the passage of the IRA as well as from other climate investments included in the Bipartisan Infrastructure Law and (BIL) and American Rescue Plan (ARPA). 

These historic investments in climate action will increase energy security through clean power generation, reduce greenhouse gas emissions, lower energy costs for families, and support inclusive career training programs and new green jobs that will help workers put food on the table and care for their families. 

With more federal funding available than ever, Climate Mayors is excited by the promise of accelerated climate progress in cities across America and ready to get to work on implementing these ambitious programs. Together, with local leaders lighting the path forward, the future of public health, safety, and sustainability is bright. We know that cities are uniquely positioned and skilled to deliver the benefits of the IRA, and we’re excited to support them along the way.

“Today we celebrate the Inflation Reduction Act and President Biden’s commitment to advancing climate action. For a decade Climate Mayors have been leading the way on climate ambition. Now, fueled by federal investments, cities are turbocharging their climate initiatives and catalyzing collective progress towards meeting U.S. climate goals. As an organization we are supporting mayors in meeting this unprecedented moment and delivering on the promise of a more equitable and sustainable future. ” – Kate Wright, Climate Mayors’ Executive Director

“The Inflation Reduction Act is helping to take climate action in Madison to new heights. Our community will be benefiting from cleaner electric vehicles and renewable energy, and both homeowners and renters will see expanded access to home energy efficiency and the utility bill savings that it generates. All while helping grow the green workforce in Wisconsin. The IRA makes impactful climate solutions accessible. We’re pleased to recognize the one year anniversary of this historic legislation and look ahead to the many successes to come.” – Mayor Rhodes-Conway of Madison, Climate Mayors Chair 

“Phoenix is addressing the impacts of climate change head on, from advancing heat mitigation strategies to pioneering new solutions to protect our water resources. This milestone investment will help us raise the bar like never before. Known as the “electric valley” and for our spirit of innovation, we’re embracing the opportunities provided by this federal support to modernize our infrastructure and capitalize on job creation potential. The issues faced by communities across the country demand alignment from all levels of government, and the Inflation Reduction Act provides Phoenix with renewed ability to meet the moment with urgency and creativity.” – Mayor Gallego of Phoenix, Climate Mayors Vice-Chair

“Cities cannot fight climate change alone. Green transportation-oriented development through the use of bike lanes and ramping up neighborhood accessibility to public transit are among the goals we intend to achieve thanks to the funding released through the Inflation Reduction Act. Further, we’re implementing solar power on the roofs of low-income housing to make energy both accessible and affordable. We celebrate the one year anniversary of the IRA and look forward to continuing to harness its potential in order to uplift communities and empower them to take full advantage of the sustainable provisions and incentives on the table for them.” – Mayor Bibb of Cleveland, Climate Mayors Vice-Chair


About Climate Mayors:

Climate Mayors is a bipartisan network that has mobilized more than 750 U.S. mayors since 2014, demonstrating climate leadership through meaningful actions in their communities. Representing 46 states and nearly 60 million Americans, the Climate Mayors coalition reflects U.S. cities’ commitment to climate progress. For more information, please visit our website and follow climate mayors on X and LinkedIn. For media inquiries please contact climatemayors@fgsglobal.com.