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Category: Legislation & Other Regulatory Issues

Real Estate Law Issues for Solar Energy: Introduction to Government Incentives

Real Estate Law Issues for Solar Energy: Introduction to Government Incentives

Once the sole domain of the ecologically minded, the green building movement has gone mainstream. Part of the green building movement has been the increase in solar power use in homes and businesses. The decision by homeowners and businesses to install solar electric systems, which are also known as photovoltaic (“PV”) systems, may be made for a variety of reasons. Some want to preserve fossil fuels and reduce air pollution. Some want to invest in an energy producing improvement to their property. Still others like the independence of a solar system, making them less vulnerable to increases in energy prices. A number of government incentives have helped spur this growth of the solar market. However, the increased interest in solar energy and solar systems has created certain real estate law issues, including: (1) the creation of solar easements, (2) restrictive covenants and homeowner’s association requirements, and (3) compliance with zoning and building codes. This article highlights the current state of the solar market and government incentives, with future articles highlighting each of items (1) through (3) above.

Mar 19, 2009 | 1 comment | View Post
Henry Gifford & USGBC's Brendan Owens Consider Merits of LEED at NESEA Forum

Henry Gifford & USGBC’s Brendan Owens Consider Merits of LEED at NESEA Forum

The Northeast Sustainable Energy Association (“NESEA”) held its annual Building Energy conference last week in Boston and sparks apparently flew during a panel discussion that featured Henry Gifford, whose controversial and well-disseminated “Lies, Damn Lies, and… (Another Look at LEED Energy Efficiency)” paper critiqued both LEED generally and the USGBC-promulgated New Buildings Institute study which concluded that LEED buildings were using 30 percent less energy than non-LEED buildings. The panel was moderated by BuildingGreen.com’s Nadav Malin and also included USGBC vice president for LEED technical development Brendan Owens. Boston-based blogger Michael Prager attended the panel and has authored an extremely insightful summary of the event, including quotes from both panelists and audience members. Many of the quotes in Mr. Prager’s article ring particularly salient in light of the uproar over the recent NAIOP study which I noted here at GRELJ last week in the context of using predicted performance as the basis for making building policy decisions. It’s clear that thus far in 2009 there has been a significant shift in attention towards building performance-related issues with respect to both LEED and green building policy generally. As states and municipalities prepare to receive close to $7 billion in stimulus funds to, in part, craft and implement local green building legislation, I think that the substance of the discussion at the NESEA event should become of increasing utility to both stakeholders and policymakers. Of course, as always, it also suggests the overarching importance of vetted contract language in connection with LEED or any other types of green building projects.

Mar 16, 2009 | 2 comments | View Post
Green Building Industry Apoplectic Over NAIOP Commercial Energy Efficiency Study

Green Building Industry Apoplectic Over NAIOP Commercial Energy Efficiency Study

Ed Mazria said that it was “meant to confuse the public and stall meaningful legislation, insuring that America remains dependent on foreign oil, natural gas and dirty conventional coal.” Lloyd Alter of Treehugger called it “one of the dumbest studies that has crossed our screen in a while.” Danielle Sacks at Fast Company wants to “make sure studies like these don’t make it past their press release.” So what, if anything, are we to make of ConSol’s study, prepared for NAIOP, which concluded that the best possible scenario for energy efficiency improvements to a hypothetical 4-story, 95,000-square-foot office building is 23 percent over the ASHRAE 90.1-2004 Energy Standard? While we continue to wait for more meaningful data about the performance of green buildings, I think the study suggests the danger- for both legislators and stakeholders- of relying on energy modeling of any kind as the basis for policymaking or who agree to assist a green building project in achieving certain energy reductions by the terms of their construction contracts.

Mar 10, 2009 | 6 comments | View Post
Introduction to the Stimulus Package: Green Building and the Stimulus (Part I)

Introduction to the Stimulus Package: Green Building and the Stimulus (Part I)

This is the first of a series of articles here at the Green Real Estate Law Journal on the impact that the American Recovery and Reinvestment Act of 2009 will have on green building generally. Future articles will provide greater detail as to the projects utilizing federal funds in a multitude of states, some unique legal risks associated with these projects, and the disputes that may arise in connection with such projects. The American Recovery and Reinvestment Act of 2009 (the “Recovery Act”) offers multiple opportunities for property owners, developers and other stakeholders in the green building arena. There are tens of billions of dollars in funding initiatives for green building in the Recovery Act. Many of the provisions are complex and the specific projects that are to be have yet to be fully provided. That being said, the commitment to green building is clearly apparent throughout the Recovery Act and a quick summary of the critical green building funding proposals are detailed after the jump.

Mar 03, 2009 | 0 comments | View Post
SB 1473: El Dorado County Fighting California Green Building Legislation

SB 1473: El Dorado County Fighting California Green Building Legislation

In the aftermath of last year’s AHRI et al. v. City of Albuquerque litigation, there has been an increased level of discussion with respect to how municipalities and states should craft green building policy and legislation. Although I have not been following what’s been taking place in California all that closely, a recent article in the Sacramento Bee noting one California county’s reaction to a newly enacted piece of state-level green building legislation caught my eye. California’s Senate Bill 1473 took effect on January 1 and requires cities and counties in California to collect, on behalf of California’s Building Standards Commission, a building permit application fee. The fee is based on the building’s valuation as determined by the pertinent local building official and is assessed at $1.00 for every $25,000.00 of value. Cities and counties are entitled to keep up to 10 percent of the fee in order to cover their own administrative and enforcement costs; the rest of the funds are sent to a special revolving fund established by SB 1473 which the Commission will use to “fund development of statewide building standards, with emphasis on green building standards.” Officials in El Dorado County (which is about halfway between Sacramento and Lake Tahoe) believe that the fee is illegal, calling it “a tax without calling it a tax.”

Feb 19, 2009 | 0 comments | View Post
Surety Industry Continues to Critique Performance Bond Requirements of D.C. Green Building Act

Surety Industry Continues to Critique Performance Bond Requirements of D.C. Green Building Act

I have often used Washington, D.C.’s 2006 Green Building Act as a paradigm for green building legislation that is enacted quickly, fails to define key terms, or fails to address other important legal ramifications that were not contemplated by the drafters. A little over a year ago over at gbNYC, we linked to a letter that Mark McCallum, general counsel for the National Association of Surety Bond Producers, had written to the D.C. City Council expressing his concerns over certain provisions of the Act. I had been wondering where the NASB’s efforts stood because certain provisions of the Act are scheduled to take effect beginning in January. Accordingly, I was interested to recently see an article in the Washington Business Journal noting that the D.C. Department of the Environment has created a working group in cooperation with the Department of Consumer and Regulatory Affairs to address Mr. McCallum’s concerns.

Dec 17, 2008 | 0 comments | View Post
Emergency Economic Stabilization Act of 2008: Energy Efficient Commercial Buildings Tax Deduction Extended Through 2013

Emergency Economic Stabilization Act of 2008: Energy Efficient Commercial Buildings Tax Deduction Extended Through 2013

I had the pleasure earlier today of leading a conference call with Studley to review provisions of the Emergency Economic Stabilization Act of 2008 (the formal title for the $700 federal bailout that was passed back on October 3, referred to herein as the Bailout) relating to energy efficiency in commercial office buildings. Most of the applicable provisions of the Bailout actually extend existing tax deductions and credits, though it does provide additional incentives that I will detail in a subsequent post. Perhaps the most critical provision for commercial owners, operators, and tenants to note is the Energy Efficient Commercial Buildings Tax Deduction, which was enacted back in 2005 as Section 179D of the 2005 Energy Policy Act. Prior to the Bailout, Section 179D was slated to expire at the end of 2008, but has now been extended through December 13, 2013. In this article, I will review Section 179D in detail. A subsequent post will detail the Bailout’s significant expansion of the Business Energy Tax Credit that was previously enacted as Section 48 of the 2005 Energy Policy Act.

Dec 17, 2008 | 2 comments | View Post
Shaw Development v. Southern Builders: America's First Green Building Litigation

Shaw Development v. Southern Builders: America’s First Green Building Litigation

Over the past two years, I have written extensively over at gbNYC about the potential for litigation arising out of green construction projects. The country’s first reported green building litigation – Shaw Development versus Southern Builders – is an excellent example of how hidden green building risks can present unconventional legal issues to construction industry stakeholders and their counsel. It is critical to note that the case does NOT discuss the contractor’s failure to achieve LEED certification on behalf of the owner (as many articles referencing my original post at gbNYC have incorrectly asserted). Rather, it suggests the importance of accurately translating green building regulatory requirements into construction documents.

Nov 15, 2008 | 1 comment | View Post
Paul D'Arelli Calls San Francisco Green Building Ordinance "LEED on Acid"

Paul D’Arelli Calls San Francisco Green Building Ordinance “LEED on Acid”

In an article that we recently posted over at gbNYC, green building attorney Paul D’Arelli of the Greenberg Traurig law firm calls San Francisco’s new green building legislation “LEED on acid.” Mr. D’Arelli points out that San Francisco’s new legislation now penalizes developers who redevelop real property, holding them to a higher green standard than developers who are building on vacant parcels. For example, if a project involves demolition work, it must achieve an additional 10 percent in LEED points in order to comply with the ordinance. “There is no correlation required in terms of the extra points required to comply with the mandated 10 percent increase and the goals sought to be advanced in rehabilitating rather that redeveloping buildings, namely preserving embodied energy and materials in existing buildings and reducing the consumption of energy and materials in constructing new building,” D’Arelli writes.

Nov 10, 2008 | 0 comments | View Post
New Jersey Legislators to Consider Green Building Incentives

New Jersey Legislators to Consider Green Building Incentives

In spite of facing massive budget shortfalls, New Jersey legislators will consider two different green building bills during their 2008-09 term. We reviewed both bills over at gbNYC earlier this fall; one would require affordable housing developers to include sustainable design features (though not formal third-party certification) while the second would offer low-interest loans to developers who achieve a LEED Silver level of certification. As the economy worsens, though, it will be a tough sell in Trenton to hand tax breaks to private interests. I expect that green building legislation across the country will face similar scrutiny- particular if litigations like the AHRI case in New Mexico cause legislators to more carefully consider how their regulatory schemes are crafted.

Oct 28, 2008 | 0 comments | View Post
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