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.

According to Don Fry, President and CEO of the Greater Baltimore Committee, the new legislation “inadvertently contradicts the state’s ’smart growth’ policy by making the counties more economically attractive to new growth and development and by impeding the city’s own efforts to grow and expand its tax base.” Specifically, Mr. Fry pointed to legislation in surrounding Baltimore, Howard, and Carroll counties that offer tax incentives for green projects rather than mandates. “This puts the city, which already has the highest property tax rate in the region, at a further competitive disadvantage,” Fry wrote in a recent op/ed piece. You may recall a similar situation unfolding in King County, Washington and Seattle a couple of years ago.

In addition, developers, many of whom have in recent years have been renovating historical structures in Baltimore’s urban core, are worried that the legislation will make such adaptive reuse projects cost-prohibitive. According to Michael Goodwin of Baltimore-based architects Design Collaborative, Inc., “[t]he reality is that right now, there is still an unknown premium to doing something green. . . . The premium, which is 4 or 8 to 12 percent on a green project, you can justify it if it’s a build and hold type of company, and in the boom we’ve been experiencing in the last four or six years, there haven’t been a lot of those.” From an engineering perspective, developers are also worried about the feasibility of simultaneously preserving historic building walls which contain glazing that will need to be upgraded in order to address LEED’s energy and atmosphere credits.

One other thought from Mr. Fry also rings salient in the context of green building policymaking: “[f]or any new policy such as this to succeed, two key things must happen. First the policy must be well-designed to achieve its intended outcome. Second, it must be well communicated to those impacted by it. Neither appears to be the case with Baltimore city’s new ‘green building’ measure.” Here, Mr. Fry is referring to the fact that the Baltimore-specific Green Building Standards that will serve as the “equivalent” to LEED have yet to be fully developed, and will not be released until the end of this year. Moreover, I would also note that, as drafted, Council Bill 07-0602 fails to include language providing for project teams to appeal a decision of the building department not to award a certificate of occupancy or building permit based on the required LEED checklists, nor does it include any sunset provision that allows the city to review the legislation’s impact and effect after a certain period of time.

It’s been a while since we’ve heard industry voice opposition to LEED-driven legislation, and the Baltimore mandate may suggest- particularly as stimulus dollars continue to flow to state and local governments to craft similar pieces of legislation, and economic conditions improve and boost construction starts- similar concerns could be raised once again in other parts of the country as well.

• Baltimore’s Green Building Standards Well-Intentioned But Flawed (GBC)
• Developers Worry About City’s New Law (TDR)
• Council Bill 07-062
• San Francisco Ordinance is “LEED on Acid” (GRELJ)