Opposition to pending LEED-driven legislation in the Garden State by the New Jersey Building Materials Dealers Association suggests an increase in the level of scrutiny for state- and local-level green building regulations in 2010.
An interesting wrinkle on the intersection of green building policy and performance is currently playing out in downtown New Haven where developer Bruce Becker is fighting the state’s Department of Public Utility Control over its recent decision to deny his application for net metering of his new 360 State Street development.
Although the costs of auditing were raised by opponents to the plan earlier this year, mandatory energy audits are now required every ten years, though buildings certified under LEED 2009 for Existing Buildings: Operations & Maintenance or which receive EPA’s Energy Star label are exempt. It’s this exemption that’s of particular interest to us here at GRELJ.
While California’s recent adoption of a state-wide green building code once again has green building legal practitioners focused on the legal issues surrounding green building legislation, the antitrust implications of incorporating LEED or other third-party green building rating systems into state- and local-level legislation has yet to be fully explored.
What were the top stories in green real estate law during 2009, but why was the most important one of all – the Northland Pines decertification proceeding – largely ignored by commentators?
The Green Tragedy: LEED’s Lost Decade was released while I was away last month. Author and Community Solutions executive director Pat Murphy traces the historical argument promoting minimal green building cost premiums, reviews the ongoing marketing effort behind LEED, and concludes that policy makers should demand energy efficiency standards more akin to the German Passive House rather than “cheap quick ‘green’ solutions.”
Recent efforts by Atlanta’s restaurant industry to resist proposed green building legislation implicate the conclusions of NIBS’ report about state- and local-level green building policy which we noted last month here at GRELJ. The Atlanta Sustainable Building Draft Ordinance would require the city’s commercial buildings and residential dwellings three stories or higher to comply with either LEED or specifications drafted by the Sustainable Atlanta committee. What’s particularly interesting about the pushback is the extent to which it reflects the conclusions in the NIBS report; for example, Keisha Carter, director of public affairs of the Georgia Restaurant Association, stated in a recent piece in Nation’s Restaurant News that “[t]here needs to be more due diligence on this before the city council can even consider passing it. There is a lot of political play going on with this thing, but we’re trying to stay on top of it and be heard. There is major concern that it will pass, but the members of the city council must come to realize it’s not in any shape to be passed just yet.” This comment reminded me of language in the NIBS report which noted that “[a]t an increasing rate, state and local governments and their code/regulatory agencies are adopting building rating / certification systems, intended as voluntary systems, to be their code or regulatory requirements, often without fully understanding their benefits, tradeoffs, and costs.”
In September of 2008, the Board of Directors of the National Institute of Building Sciences (“NIBS”) assembled a Task Group of design professionals, builders, and its own staff members to review third-party building performance rating systems and associated individual accreditation programs currently in use across the United States. The Task Group identified twenty systems and programs and interviewed representatives from AIA, ASHRAE, BOMA, GBI, NAHB, EPA, USGBC, and Victor O. Schinnerer & Co.. among others, in compiling its “Report on Building Rating and Certification in the U.S. Building Community,” which was released last month.
The San Francisco Chronicle has picked up on the recent flurry of commentary generated by Mireya Navarro’s piece in the New York Times about the LEED building performance gap. The article opens up by stating “[r]evelations that many buildings certified as green under a broadly accepted national standard for energy savings are not performing as well as predicted recently prompted changes to the [LEED] program and are forcing San Francisco officials to consider amending city rules that are tied to the older guidelines.” However, a closer look at the substance of the article suggests that city officials may actually be trying to expedite the application of the LEED 2009 system and its corresponding Minimum Program Requirements (“MPRs”) to large, private construction projects. (As you will recall, the new MPRs require that projects which pursue LEED certification to “commit to allow USGBC to access all available actual whole-project energy and water usage data in the future for research purpose” or risk decertification.) I also think the piece is noteworthy because it suggests an inextricable link between increased data reporting and increased building performance.
Some interesting legislative developments are taking place right now in Nashville, Tennessee that implicate many of the green building policy issues that we’ve been wrestling with over the past few months here at GRELJ. Since 2007, metropolitan Nashville has required most new and major public projects to larger than 5000 square feet or costing more than $2 million to earn LEED certification. Recently, city councilman Duane Dominy of suburban Antioch introduced legislation that would “allow the Metropolitan Government to pursue an alternative sustainable development design standard to LEED certification based upon pre-determined energy reduction and efficiencies. If Metro chose to pursue an alternative to LEED, the contractor would be required to warrant for a three-year period that the annual energy use for the building will be less than similar buildings” or will earn a minimum score under EPA’s Energy Star program.
On July 1, new green building legislation applying to private development took effect in Baltimore. Council Bill 07-0602, which was signed in August of 2007, required that the city establish green building standards for new or substantially renovated commercial and multi-family residential buildings larger than 10,000 square feet. City-owned buildings were required to comply with the new legislation beginning January 1, 2008, city-subsidized buildings by January 1, 2009, and all other buildings this past July 1. While the city is developing its own Baltimore-specific green building standards that should be released by the end of 2009, in the interim, in order to obtain a building permit, all buildings applying must be “equivalent” to LEED Silver. The legislation does not require formal LEED certification, but owners must submit a checklist for the appropriate LEED rating system as part of the plans submittal for a new building permit. Checklists must set forth specific credits the project will pursue, briefly describe how each credit will be achieved, and (interesting to note from a legal perspective) the parties responsible for each credit. The checklist must also be signed by a LEED AP who is not an employee of the building owner at the time of submittal. Again, although certification is not required, in order to obtain a building occupancy permit from the city, at the time of occupancy permit application, project teams must submit a completed checklist indicating which credits the project met successfully, signed by a non-employee LEED AP. As we’ve discussed frequently here at GRELJ, all of these requirements could raise interesting- and novel- liability issues in the event that a project fails to receive a building permit or certificate of occupancy as originally contemplated. However, the city’s development community is calling for Baltimore’s City Council to reconsider the legislation based on perceived additional green building first costs and asking it to propose an incentive-based structure in its place.
As the Waxman-Markey climate change legislation heads to the Senate, I think it’s important to note that, as currently drafted, the bill includes provisions that could impose the types of energy efficiency mandates which NAIOP argued against in its controversial report that was released earlier this year. Section 201 of the American Clean Energy and Security Act (H.R. 2454) would first set baseline standards for all commercial (ASHRAE 90.1-2004) and residential buildings (the 2006 IECC code) and dates for certain percentage reduction targets in energy consumption over those baselines. The Act would require an immediate 30 percent reduction over those baselines once enacted (likely in 2011 or 2012 if the bill proceeds through the Senate and is implemented as drafted), followed closely by a 50 percent reduction by 2014 for residential buildings and 2015 for commercial buildings. The reduction mandate would increase by 5 percent every 3 years through 2029/2030 for a total reduction of 75 percent over the baselines. However, the Department of Energy would have the ability to increase or decrease the reduction targets based on technological feasibility. Section 201 further obligates state and local governments to adopt the codes, or their own codes that meet or exceed the established targets; the federal government itself will enforce the national codes if state and local governments fail to comply. If you recall the comments from NAIOP President Thomas Bisacquino in the aftermath of the uproar created by the NAIOP study, Waxman-Markey may ultimately create the precise scenario that NAIOP and its constituents feared: 30 to 50 percent reductions over ASHRAE 90.1-2004 in the short-term.
Notwithstanding many of the persistent- and still emerging- concerns over the increased risks from their installation, Toronto is on the verge of becoming the first city in North America to mandate green roofs for most types of new construction. By a vote of 36-2 which, according to the National Post, “was adopted after remarkably little debate on the floor of council,” the sweeping legislation requires green roofs on all residential buildings over 6 stories, schools, affordable housing developments, commercial, and industrial buildings. The legislation is slated to take effect on January 31, 2010 for new residential and commercial construction; industrial buildings are not impacted until January 31, 2011. The development community in Toronto opposed the legislation on the basis of increased costs, while green roof advocates believe the legislation is not broad enough, and actually successfully fought to increase its purview over a previous iteration of the bill. Toronto’s mandate is interesting to consider in light of the risks that we have pointed out previously both here at GRELJ and over at gbNYC with respect to green roofs generally.
During the first homestand of the season at $1.6 billion New Yankee Stadium, baseballs flew out of the ballpark at an unprecedented rate; the 20 dingers that were clocked during last weekend’s series against the Cleveland Indians were the most ever in a four-game set to open a new stadium in baseball history. Last season, Old Yankee Stadium saw 160 home runs; the current pace would yield a mind-boggling 351 round-trippers for the entire 2009 season. The Yankees did not anticipate that their new ballpark would turn into a Little League bandbox; dimensions at the new park are the same as they were across the street and engineers performed a wind study in advance of construction that did not suggest any major changes in currents or speeds. So, after witnessing several routine fly balls to right field land halfway into the lower deck last Saturday, it struck me that there are some parallels between what’s been happening thus far at the new ballpark in the Bronx and some of the building performance issues that we frequently discuss here at GRELJ.
I took great interest in a number of the documents that NAIOP released in the aftermath of its controversial energy efficiency study. The organization has compiled both an FAQ and fact sheet detailing the various assumptions it made and conclusions it drew in an effort to clarify some of the unproductive vitriol that has flown around the web over the past month decrying its conclusion that 30 percent energy reductions are not practicable for the majority of commercial office properties. Both the fact sheet and FAQ are available on NAIOP’s web site and point out that the results of the study do not apply to all buildings; “[t]he study analyzes a typical office building that represents more than 50 percent of new Class A construction [that took place] in 2008.” NAIOP also clarifies that the subject building is a real 95,000-square-foot, speculative commercial office property in California, and claims that the results of its study show what’s possible for the “vast majority of new construction without having to redesign a typical office building,” calling the results “impressive.”
Washington State’s High-Performance Public Buildings Act requires LEED Silver certification or a design that complies with the state’s Sustainable School Design Protocol for schools larger than 5000 square feet. In a video describing the benefits of green schools that is available on the State Superintendent of Public Schools’ web site, certain claims are made about the promise of “clean, high-performance, money-saving schools” that are “a wise business choice for cost conscious schools. Relatively small increases in design and construction costs, usually less than 2 percent, ultimately bring 10 to 15 percent reductions in long-term operating costs.” The folks at KING 5 television in Seattle caught wind of these claims and decided to do some digging; you can view the station’s full report through the link at the bottom of this article. As you might guess, the station concluded that the state’s claims about green building premiums, decreased operating expenses, and higher student test scores were highly exaggerated.
