What one change would you make to LEED to encourage green building?

In recent days, I asked the question, “what one change would you make to LEED to encourage green building?” to four score and seven people familiar with green building.

This was a highly unscientific poll that is not representative. The small sample was not randomly selected, but rather each was a professional working on green building projects, so the results have some statistical reliability. And when coupled with the result that more than 50% offered the same solution and the next offered solution polled at only 8%, the responses to this question, posed by someone not associated with the U.S. Green Building Council, are a useful tool of analysis.  

Against a backdrop of the increasing belief, as recently articulated by Bill Gates that current green technologies can reduce carbon dioxide emissions and the human contribution to climate change only at costs that are “beyond astronomical” many have begun to focus on another frontier of innovation, on using energy more efficiently, and thus using less of it. Given that green buildings regularly consume 25% less energy or more, green building may be the single greatest current opportunity to address climate change.

There are nearly 4. 9 million commercial buildings in the U.S. which makes existing buildings the target rich environment (i.e., each year only about 170,000 new commercial buildings are constructed). And those existing buildings are tremendous consumers of electricity, accounting for 74% of the total electricity consumption in the U.S.

There are a variety of green building standards, codes and rating systems, but LEED commands a more than 95% market share in the U.S., so the answer may be expressed in terms of LEED.

And the LEED for Existing Buildings: Operations & Maintenance rating systems are highly regarded when they identify and reward current best practices and provides an outline for buildings to use less energy and uncover operating inefficiencies.

In 2014, LEED for Existing Building Operations and Maintenance was once again the most popular rating system, with existing buildings representing 48% of the total square footage LEED certified.

But the problem is that since LEED EB was launched in 2004, today there are only a total of 3,778 certified LEED EB buildings. That is less than one tenth of one percent of the 4.9 million existing commercial buildings.

However, an existing building that cannot achieve an Energy Star Portfolio Manager rating of 75 is excluded from participating in LEED v4. (An Energy Star score of 75 means the building is performing better than 75% of similar buildings nationwide.) The prerequisite of a minimum score of 75 arguably excludes 75% of all existing buildings from participating in LEED. This is more significantly stringent than LEED 2009 requiring an Energy Star score of 69.

There is a pilot credit known as “EAp2 Energy Jumpstart” such that an existing building that reduces energy consumption by 20% is now LEED v4 eligible. But, after much internal debate, it is only a LEED pilot credit and available to only the first 500 applicants.

Which gets us back to the question, “what one change would you make to LEED to encourage green building?” The number one answer, by far, allow every existing building that improves its Energy Star score by at least 20% to be LEED EB eligible! 

That single change to the rating system would make millions of buildings eligible to participate in LEED and may be the single greatest current opportunity to address climate change.

Court Blows Away Permits for Wind Turbine Eagle Kills

On August 11, a federal court set aside the U.S. Fish and Wildlife Service rule allowing 30 year permits to “take” bald and golden eagles. In an industry born from tax credits and government energy policies an interruption of one of those key policies can bring wind turbine construction to a halt.

The Bald and Golden Eagle Protection Act, which was enacted in 1940, imposes criminal and civil penalties against “whoever” shall “take, possess, sell, purchase, barter, offer to sell, purchase or barter, transport, export or import” bald and golden eagles, except as permitted by the Department of Interior Secretary.  

On September 11, 2009, FWS issued regulations for the first time that “authorize limited take of bald eagles .. and golden eagles .., for 5 years or less, where the take is not the purpose of the activity but is a foreseeable consequence of that activity.” The 2009 regulations themselves included but a few references to wind turbines. For instance, FWS cited “a company interested in siting a wind-power facility” as an example of an entity that “may qualify for a programmatic take permit.” 74 Fed. Reg. at 46,842.

Soon after the 5 year rule was issued in 2009, there was a substantial increase in the development of wind power for renewable energy purposes. Because “eagles can be killed by colliding with structures such as wind turbines,” FWS developed the Eagle Conservation Plan Guidance for the wind industry to “help project operators in complying with regulatory requirements and avoiding the unintentional ‘take’ of eagles at wind energy facilities.”

One issue not addressed by the Guidance “was the wind industry’s extensive comments that the five-year maximum tenure of permits under the Eagle Take Rule is fundamentally unworkable for the industry considering the life of most wind projects is 20 to 30 years.” The industry’s chief complaint was that the uncertainty surrounding the renewal of 5 year programmatic eagle take permits was preventing operators from obtaining the necessary 30 year financing for wind energy projects.

On December 9, 2013 the FWS adopted a “strictly administrative” rule increasing the maximum duration of programmatic permits to take bald and golden eagles from 5 years to 30 years, which I wrote about in the blog post Okay to Kill Eagles with Wind Turbines But Not with Solar Panels or .

However the Court in Shearwater et al v. U.S. Fish and Wildlife Service et al, concluded that FWS failed to show an adequate basis in the record for deciding not to prepare an EIS [environmental impact statement], much less an EA [environmental assessment] - prior to increasing the maximum duration for programmatic eagle take permits by six-fold.

While promoting renewable energy projects may well be a “worthy goal, it is no substitute for the [agency’s] obligations to comply with NEPA and to conduct a studied review and response to concerns about the environmental implications of major agency action.” Accordingly, the Court held that FWS violated its procedural requirements and that the 30 year rule must therefore be set aside.

The practical effect of this court ruling is less than clear because despite creating uncertainty in the wind turbine business and hardening beliefs that the Obama Administration is attempting to pick winners and losers in energy, FWS is today considering new regulations in this area. At the same time the proposed 30 year rule was published, FWS issued an Advance Notice of Proposed Rulemaking, considering comprehensive changes to the 2009 regulations and on June 23, 2014, FWS stated its intent to prepare an EIS or EA on these changes allowing wind turbines to kill eagles (but not solar panels or even electric transmission lines?).

Climate Change Disclosures by Public Companies

In recent weeks this law firm has received more inquiries than at any time in recent years about the Securities and Exchange Commission’s disclosure requirements for public companies as they apply to climate change matters.

Possibly the Environmental Protection Agency's proposed rule for emission reductions for existing power plants triggered this heightened level of interest or it could be President Obama’s newly announced series of executive actions on climate change or maybe it is simply increased concern over shareholder activism. The SEC required disclosures are not limited to automobile manufactures and electricity generating utilities, but also may apply to a broad breadth of industries, including by way of example, real estate (i.e., if only as an indirect consequence of buildings accounting for 72% of the electricity consumption in the U.S.).  

Federal securities laws and SEC regulations require certain disclosures by public companies for the benefit of investors.

When a company is required to file a disclosure with the Commission, those disclosures (e.g., notes in an annual report) will largely track the disclosure requirements of Regulation S-K and Regulation S-X. Securities Act Rule 408 and Exchange Act Rule 12b-20 require a registrant to disclose, in addition to the information expressly required by Commission regulation, “such further material information, if any, as may be necessary to make the required statements, in light of the circumstances under which they are made, not misleading.”

The SEC first addressed disclosure of material environmental issues in the early 1970s. The Commission issued guidance that public companies should consider disclosing in their SEC filings the financial impact of compliance with environmental laws.

In 2010, by a 3 - 2 split by the vote of five SEC commissioners, the SEC issued guidance on SEC disclosure requirements for companies on the impact that “climate change may have on its business.” Based upon that SEC guidance, the following areas are examples of where climate change may trigger disclosure requirements:

Legislation and Regulation: When assessing potential disclosure obligations, a company should consider whether the impact of existing or pending laws and regulations regarding climate change is material.

International Accords: A company should consider, and disclose when material, the risks or effects on its business of international accords and treaties relating to climate change (e.g., COP 21 is only weeks away).

Indirect Consequences of Regulation or Business Trends: Legal, technological, political and scientific developments regarding climate change may create new opportunities or risks for companies. For instance, a company may face decreased demand for goods that produce significant greenhouse gas emissions or increased demand for goods that result in lower emissions than competing products. As such, a company should consider, for disclosure purposes, the actual or potential indirect consequences it may face due to climate change related regulatory or business trends.

Physical Impacts of Climate Change: Companies should also evaluate significant physical effects of climate change, such as effects on the severity of weather (for example, floods or hurricanes), sea level, the arability of farmland, and water availability and quality, etc.

Among the existing disclosure rules that may now advisedly trigger climate change disclosures, the SEC casts a broader, more subjective interpretation of its requirements for ‘management discussion and analysis’ disclosures, which practically require the company to disclose “currently known trends, events, and uncertainties that are reasonably expected to have material effects.”

In 2010, immediately after the SEC guidance, this law firm worked with a large number of publicly traded companies and their counsel and outside consultants to advise them about these requirements. That year more than 25% of public companies used the term “climate change” in their annual report, most for the first time.

Data culled from filings of public companies listed on U.S. stock exchanges reveals that last year less than 30% of companies made a climate change disclosure. The heightened interest we have experienced suggests that number will be increasing.

We assist public companies in matters of climate change and sustainability, including voluntary environmental reports, as well as SEC disclosures and financial statement compliance. If we can assist your company, please contact Stuart Kaplow.

Litigation over First LEED Platinum Building Comes to an End

On July 23, 2015, the parties in the lawsuit The Chesapeake Bay Foundation, Inc., et al v. Weyerhaeuser Company, et al, pending in the U.S. District Court for Maryland, filed a Stipulation of Dismissal with Prejudice following a confidential Settlement Agreement and Mutual Release.

Because the settlement is confidential we do not know precisely how this case ended.  

But we do know the facts as recited by the trial judge in a May 4, 2015 opinion ruling on motions, ..

More than 15 years ago, CBF contracted with SmithGroup, Inc. to design the Philip Merrill Environmental Center, CBF’s headquarters, on the Chesapeake Bay in Annapolis, Maryland. CBF also contracted with Clark Construction Group, LLC as general contractor to oversee the construction, which spanned from 1999 into 2000. SmithGroup’s ‘green’ design called for exposed structural wood members outside the envelope of the Merrill Center, including some that penetrated the building’s façade.

Weyerhaeuser, a manufacturer of columns and beams, agreed in a purchase order to provide Parallams to Clark for use as the exposed wood members. Parallams, which have a rough-hewn appearance, are manufactured by bonding together strips of wood (i.e., a then new, LEED rapidly renewable material). The wood strips’ lack of uniformity creates channels, or avenues, that run longitudinally through the Parallams. Thus, water is expected to infiltrate Parallams used outdoors. To protect against rotting, Parallams are pressure treated with a wood preservative.

The Clark Weyerhaeuser purchase order required Weyerhaeuser to treat the Merrill Center’s Parallams with the preservative PolyClear 2000 (i.e., a then new, LEED low emitting material). Weyerhaeuser engaged third party defendant Permapost Products Co. to apply the PolyClear 2000 treatment, and Permapost provided certificates to Weyerhaeuser verifying that the treatment had occurred. Nonetheless, 5 years later, CBF discovered that the Parallams indeed had rotted and deteriorated and subsequently learned that the Parallams had not been treated with PolyClear 2000 as certified, that PolyClear 2000 was not in any event well suited to the job of preserving the Parallams, and that Weyerhaeuser had knowingly given false assurances to the contrary.

Less than 50 days after the trial judge recited those facts in an opinion granting in part and denying in part cross motions for summary judgment, the parties entered into the Settlement Agreement. Weyerhaeuser’s third party action against Permapost is unaffected by the dismissal and remains scheduled for trial beginning November 9, 2015.

Despite the confidential settlement we know a lot about this case. CBF initially settled with SmithGroup and Clark who undertook remediation measures which involved replacing the Parallams and then they all commenced this action against Weyerhaeuser to recover more than $6 Million related to the deteriorating columns.  Those interested in the procedural history of this case may look to my earlier blog post Litigation Over First Ever LEED Platinum Building.

Substantively the case suggests there is no more liability arising from green building versus other construction, but that the liability is different.

The crux of this case is one of those differences, claims arising from materials. It should give architects pause, now more than ever, that specifying new or untried materials and products (that are often the keystone of sustainable building) comes with unique risks; and in this case PolyClear 2000 was specified even before the emerging era of expanded liability arising from environmental product declarations and health product declarations.

Finally, the most significant take away from this case, that involved sophisticated parties engaged in a multi-Million Dollar green building project that was the first LEED Platinum building, is that properly drafted contract documents are both the best sword and shield for mitigating risk. 

IgCC will now be Powered by ASHRAE 189.1

Last Friday, the International Code Council and ASHRAE announced they signed an “agreement that the new version of the International Green Construction Code (IgCC), .. scheduled to be released in 2018, .. will be powered by” ASHRAE Standard 189.1 for the Design of High-Performance Green Buildings.

Much of the early reaction has been nonplussed given that, today, there are only a handful of IgCC green buildings.  

The ICC will still be responsible for IgCC Chapter 1, Scope and Administration, so that the green code will continue to be integrated into the ICC construction codes. And now that ASHRAE will be developing all the technical provisions of the IgCC, ICC announced the “2017 Group C cycle to develop the 2018 IgCC has been cancelled.”

By way of background, in 2005, U.S. Green Building Council and Illuminating Engineering Society of North America, worked in concert with and provided technical support to ASHRAE in developing the first ASHRAE Standard 189.1. Shortly thereafter, independently, ICC began development of the IgCC, which was first published in 2009. Standard 189.1 was published with the IgCC as an optional alternative compliance path for governments adopting a green code.

Against that blurring of the lines between green building standards, codes and rating systems, in 2014 the ICC, ASHRAE, the American Institute of Architects, the IES, and the USGBC announced the signing of a memorandum “to collaborate on the development of future versions of Standard 189.1 and the LEED green building program.” From that agreement has come an Executive Steering Committee to align the green programs.

The 2018 green code also will align with LEED to provide “a streamlined, effective set of regulatory and above-code options.” To achieve LEED certification, buildings will continue to have to satisfy prerequisites and earn credits above levels necessary to meet the IgCC.

Some are concerned that relying on ASHRAE’s technical expertise alone risks further stifling innovation in green building. Accepting that green building is a geoengineering solution to the negative impacts that man has on the natural environment, anything that might further slow and already stalling domestic green building market is problematic.

Others are concerned that the nonpublic written agreements between these stakeholder groups despoil any purported voluntary consensus process, favoring one industry player over another in the multi Billion dollar domestic construction industry.

But many commentators suggest the real problem can be traced to March 18, 2002, when the City of Normal, Illinois enacted the first law mandating that all new buildings within a business development district be required to achieve LEED certification. LEED was designed as a voluntary rating system and to gerrymander it into a code is not efficacious.  Many believe that voluntary, non mandatory green building is the best hope for environmental protection and stewardship of our planet; hence the broad brand and wide market share acceptance of LEED.

The broad failure of the IgCC to be implemented by only 19 of the 89,055 governments with permitting authority in the country portends a mandatory code that goes far beyond life safety may be going too far.

But the announcement last Friday means there will be a 2018 version of the IgCC (.. something that was less than certain given the very low market acceptance of the IgCC). Whether created by the ICC or by ASHRAE, a mandatory IgCC will remain controversial. This change also means there will continue to be green standards, codes and rating systems. Such is good for green building and good for the stewardship of our planet.

The First Green Building Litigation. The Rest of the Story.

It was widely reported that the first green building litigation in the country was the 2007 trial court case of Southern Builders, Inc. v. Shaw Development, LLC, in the Circuit Court of Maryland for Somerset County, case no. 19-C-07-011405.

In the spirit of Paul Harvey’s “The Rest of the Story” radio program, last week I telephoned Jim Shaw, of Shaw Development, to follow up, ..  

In the Southern Builders case, disputes and difference arose out of the construction of a $7.5 Million, 23 unit luxury condominium and restaurant project in Crisfield, Maryland, called Captain’s Galley and substantially completed in 2006. In January 2007, Southern Builders, the general contractor, commenced a mechanics lien action in the Circuit Court. A counterclaim was filed by Shaw Development alleging breach of contract and negligence. Significantly, a motion to stay proceedings and compel arbitration was granted by the court in response to the contract provision (the parties having utilized AIA B101 – 1997™) that mandated binding arbitration. In advance of arbitration, the disputes and differences were resolved between the parties and a stipulation of dismissal was filed in June 2007.

Despite that relatively simple procedural history, much has been written about the case, largely overstating an allegation in the counterclaim that claimed,

“10. Specifically, the Project Manual and Scope of Work required Southern Builders to construct an environmentally sound “Green Building,” in conformance with a “Silver Certification Level according to U.S. Green Building Council’s Leadership in Energy & Design (LEED) Rating System,” as more specifically set forth in the Project Manual and Project Specifications, Division I Section “LEED Requirement.” .. .. In failing to comply with this contractual requirement, Shaw Development will suffer damages in the amount of a Six Hundred Thirty-Five Thousand Dollar ($635,000.00) tax credit.”

But the only relevant contract provision provided,

“D. The Work consists of the following: .. .. 2. Project is designed to comply with a Silver Certification Level according to the U. S. Green Building Council’s Leadership in Energy & Design (LEED) Rating System, as specified in Division I Section LEED Requirements.”

Arguably, this was a fairly ordinary construction dispute that began as a mechanics lien action for failure to pay, but the settlement that resulted in the contractor completing the work and the developer executing a $54,000.00 promissory note in favor of the contractor, does not tell the rest of the story, nor does the fact Shaw Development later filed for Chapter 11 bankruptcy protection in response to a foreclosure action by the project’s lender.

Most people are not aware the project was ultimately LEED certified (based on a submittal by the architect), and the Maryland Energy Administration issued a $625,872.00 tax credit certificate. That green building tax credit was monetized and sold to 5 Maryland taxpayers. Unfortunately, most of the 23 residential units sold for less than half of the original asking price, so the project has not been a great financial success.

Southern Builders is instructive because, commenced as a mechanics lien action for failure to pay, this is how many construction disputes, including those that involve matters of green building, reach the courts. Those cases are then defended with counterclaims under any number of other causes of action from breach of contract and breach of warranty to negligence and misrepresentation including allegations that green building requirements have not been complied with.

Despite the hue and cry over the possibility of increased liability and the legal risk from green building, there is still not a single reported appellate court decision anywhere in the United States resolving green building disputes and differences.

And now you know the rest of the story.

Lawyers' Opinion Matters in Green Building Transactions

This law firm is increasingly called upon to give legal opinions that a green building is LEED certified, certifiable or otherwise ‘really’ a green building.

The purpose of a legal opinion given in a commercial real estate transaction is, most simply put, to provide some or all of the parties to the transaction with comfort regarding specified aspects of the transaction.  

One might ask why the need for an opinion from a lawyer that a building is green? While legal opinions are given in a variety of commercial contexts, they are increasingly being required as part of the due diligence by lenders, investors and purchasers of green buildings. The opinion we are most often asked to render is required by a lender.

The size and nature of a transaction may well affect the scope of the opinion requested and in larger traditional mortgage financing as well as green bond financing, lenders attribute increased value in the security being provided for loans when a building is LEED certified or the like, so they want to know the building is really green.

Opinion letters are often given by the borrower’s attorney at the request of and for the benefit of the lender. Traditionally, legal opinions in the context of loan transactions provide assurances that the loan documents are valid, binding and enforceable. Often legal opinions arising from the purchase of real estate involve assurance that the improvements exist accordance with applicable zoning, subdivision and other land use laws and regulations. Opinions are also given, from time to time, that a project complies with environmental laws. And now counsel to borrowers are being called upon to provide assurances to the parties that the real property and improvements which exist or are to be constructed have been designed and exist or will exist in accordance a stated green building standard, rating system or code.

Additionally, as increasing numbers of governments make green building mandatory or offer incentives for high performance buildings, purchasers and lenders alike want assurances that a building is in compliance with those green building laws. Tenants, who with greater frequency are required by law or policy to lease only green premises (from the federal government to multi family residential builders and colleges to retail builders) are a fast growing requester of opinions.  

From time to time we are called upon to render opinions to government agencies and entities and that work will only expand as green building requirements become inculcated in government.

We also receive requests to give opinions of counsel that a project is ICC 700 ‘certifiable’ or ASHRAE 189.1 compliant or complies with Enterprise Green Communities criteria; commonly associated with qualifying for governmental incentives. Committing that a project will be LEED certifiable versus certified by GBCI increases certainty and lowers risk.

And while we believe a lawyer should not be asked to be an additional warrantor of facts, the distinction between questions of law and fact may at time be difficult to separate. In giving an opinion, a lawyer is not and should not be thought to be providing a guaranty or insurance against loss.

There is no single accepted form of green building opinion. The Legal Opinions Committee of the American Bar Association does not yet provide standardized language in this area. And while a bit of inside baseball, the form of opinion this firm provides in modeled after a widely accepted zoning opinion form. 

Many of the opinions we give are actually in the role of “other counsel” or “special counsel” addressing only green building issues, and are relied upon by other and local counsel who are representing the building owner.

As a function of the fact that there are more green buildings being constructed and those building are being sold and financed, not to mention the explosive growth of green bonds, we will be giving increasing numbers of legal opinions that green buildings are ‘really’ green buildings.

LEED Bird Collision Deterrence to be Required in Highland Park

The City of Highland Park, Illinois, became the latest jurisdiction to consider bird friendly building regulations when on June 22, 2015 the City Council forwarded a proposal to the Plan Design Review Commission for comment prior to final approval by the Council.

Specifically, the City Council is proposing that bird friendly regulations be adopted for commercial, industrial and multi-family buildings and that they follow requirements set forth in the LEED NC-2009 SS Pilot Credit 55 Bird Collision Deterrence.  

The Highland Park City Code already requires bird friendly building construction for public buildings only.  That ordinance was approved in February 2011 and provides the City “shall, to the greatest extent practicable, incorporate bird-safe building materials and design features into the design of all newly-constructed buildings to be used primarily by the City ..” 

And there are other bird friendly building construction laws scattered across the country, although nearly all only regulate government funded building.

The State of Minnesota has since May 2013 required for all projects that receive general obligation bond funding from the State for new construction or major renovation apply the LEED SS Pilot Credit 55 standard. It is that same standard now being adopted in Highland Park.

There’s no nationwide repository of bird casualties or injuries, so estimating the scope of this is difficult. It is widely perceived that building collisions, and particularly collisions with windows, are a major threat to birds, with estimates swinging widely. A recent literature search published in The Condor, based on 23 studies, estimates that between 365 and 988 million birds are killed annually by window collisions in the U.S., with roughly 56% of mortality at buildings 4 to 11 stories, 44% at buildings 1 to 3 stories, and less than 1% at skyscrapers. But keep into in mind there are only about 21,000 buildings 12 stories or higher in the U.S. versus over 123 million 1 to 3 story buildings, so statistically only 24 birds might perish each year at any one skyscraper.

But at Duke University, the Fitzpatrick Center with a largely glass building envelope caused 85 bird deaths during 9 weeks.

It is suggested that green building programs, like LEED, encourage using natural light to reduce energy use and encourage green views resulting in the use of more glass. And windows are no friends to birds as we all know from the popular Windex television ad.

However, on that same Duke campus, the Penn Pavilion, almost entirely made of glass, was fitted with etched panes and saw only two collisions last year. With biomimicry windows can be made bird friendly by covering the glass with a UV reflective coatings or by etching or pigmenting a pattern into the glass, which birds can see while remaining virtually transparent to the human eye.

There has been a lot of media attention about the almost 200,000 square feet of glass at the proposed Vikings stadium and the supposed costs of using bird friendly strategies.

Arguably, the LEED SS Pilot Credit 55 is not first cost prohibitive. It seeks to “reduce bird injury and mortality from in-flight collisions with buildings” through compliance with one of several building façade options, one of the interior lighting options, one of the exterior lighting options, and a post construction monitoring plan. Key is developing a building façade design strategy to make the building visible to birds as a physical barrier and eliminate conditions, including lights that create confusing reflections to birds.

And while all of this is good, the window between the average house cat and the bird outside offers less protection than it may appear, with biomimicry features or not. A study in Nature Communications in 2013 reported house cats kill 1.4 billion to 3.7 billion birds per year, far more birds than perish annually due to collisions with windows. And the same study found that wind turbines across the U.S. killed 573,000 birds in 2013.

How many birds can be saved by LEED certified buildings is debatable, but in a post Fedrezzi era, the greatest expansion of the influence of LEED across the U.S. may be incorporating individual LEED credits (from water use reduction, to sound baffling and bird collision deterrence to ..) into local building requirements. 

Image Credit Temple University 2013

Government Ownership of Rain is Antithetical to Increased Potable Water

Against a backdrop of California experiencing the worst drought in its history and the U.S. Supreme Court having before it an interstate water dispute, where Florida seeks an equitable apportionment of the waters of the Chattahoochee and Flint Rivers over the claims of upstream Georgia, the issue of “who owns the rain” is of national importance.

Collecting rain and using it for a desired purpose on one’s own property should no longer violate laws. And the government should not take the rain falling on private property without just compensation.  

In point of fact, laws like the City of Tucson Ordinance 10597 of 2008 that require a minimum of 50% of water used for landscaping on new commercial properties be from collected rainwater on the site, may be the way of the future.

A simple and effective way to increase potable water supply and to decrease demand on stressed freshwater resources is collecting and using the rain allowing the free market to control water.

For millennia civilizations have recognized benefits of collecting the rain. Many ancient Roman homes had small cisterns to augment water supply from the aqueduct system. Rain barrels were once common across America both on farms and in towns. But centralized water infrastructure of the 20th century with the associated new laws to buttress it, the 19th century federal government claim that it controls all navigable water and unconstitutional state claims to land beneath watercourses, all made collecting rain illegal.

Water law in the western U.S. is governed by the “prior appropriation” doctrine. The details vary from state to state, but the first person to take a quantity from a water source for a beneficial use has the right to the continued use of that quantity of water. Water law in the eastern U.S. generally recognizes “riparian rights” where landowners whose property abuts a body of water have the right to make reasonable use of the water and if there is not enough water to satisfy all users, allotments are generally fixed in proportion to frontage on the water course. The difficulty under both schemes of water law was articulated by Utah Supreme Court Chief Justice Wolfe,

“All rain and snow water belongs to the public regardless of whose land it falls upon. Like all fugitive substances, it can belong to no one else except the public.” McNaughton v. Eaton, 1952 

Governments from Maryland to Colorado now regularly take the position that collecting precipitation is not legal, as a diversion of rainwater before it enters a water course. Maryland has the most stringent storm water (i.e., rain) regulation in the nation and even taxes the rain (by square foot). The Colorado legislature made clear it was illegal to capture rainwater off of one’s rooftop, as it infringed on the supply of senior water rights holders downstream, when in 2009 the state authorized certain limited exemptions approved by the State Engineer on residential roofs where no municipal water supply is provided.

However, collecting the rain has been legal in Utah since May 11, 2010, the effective date of Senate Bill 32 that provides “for the collection and use of precipitation without obtaining a water right” (storing up to 200 gallons above ground or 2,500 underground) after registering on the Division of Water Rights.

Today the City of Albuquerque Water Utilities Authority offers rebates of $1.50 per square foot for desert friendly landscaping and rebates of up to $150 on rain barrels, in spite of New Mexico law, including a policy of the State Engineer, “the collection of water … should not reduce the amount of runoff that would have occurred from the site in its natural, pre-development state.”

Collecting rain and using it for a desired purpose on one’s own property should no longer violate the law. Utah’s decriminalizing precipitation collection may be a model for the nation. Tucson may have gone too far in mandating rain collection for landscaping. But is it too farfetched to imagine government increasing potable water by not only making it legal but even offering incentives, like Albuquerque, for collecting rain? 

In the Name of Clean Water Millions of Acres are Proposed for Federal Control

The Environmental Protection Agency and the U.S. Department of the Army published a final rule on May 27, 2015, “clarifying” the scope of waters protected under the Clean Water Act. The rule is proposed to be effective 60 days after Federal Register publication.

EPA Administrator Gina McCarthy is quoted as saying the new rule will expand the scope of waters of the United States by “only about 3%” but that 3% represents millions of acres that are not today regulated.  Some commentators have suggested that depending upon the EPA’s application of the rule, the true number may be tens of millions of new acres of privately owned land being removed from productive use. 

For those uninitiated in the moving target clarifying what are “navigable waters of the United States,” defining where those waterways begin and end has since the enactment of the 1899 Rivers and Harbors Act been the subject of disputes between the federal government and land owners (predating the modern environmental movement).

The agencies proposed this rule in April, 2014, and solicited comment. This final rule was issued after over 1 million public comments on the proposal.

EPA detailed many of the changes in a series of industry-specific fact sheets. But the EPA commissioned report, Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of the Scientific Evidence provides much of the technical basis for this rule.

The rule is intended to reduce the use of the 1987 Corps Wetland Delineation Manual which is used to make a case by case determination of whether or not a property is a jurisdictional water of the United States. Under this rule, all “tributaries” and all waters “adjacent” to traditional navigable waters (with adjacent now being broadly defined to include  “neighboring” which term is defined as being located within a minimum of 100 feet and within the 100 year floodplain to a maximum of 1,500 feet of the ordinary high water mark), always will be jurisdictional waters.

Among the other more controversial features of this rule is that EPA and the Corps are extending jurisdiction over “case-specific significant” regional water features, like coastal bays in the Delmarva peninsula and the Carolinas, and prairie potholes in Texas and throughout the central U.S. Some have suggested this all sounds like a lot more than a 3% expansion and none of this is navigable (e.g., actually passable by a boat) under any reasonable interpretation.

The House of Representatives voted two weeks ago to block the rule and a similar bill was voted out a Senate committee days later. And Congress may not get the last say as litigation is in the offing and the Supreme Court has twice since 2001 issued decisions on waters of the United States rules (albeit it with two different results).

It is regularly suggested this is not a good way to make environmental policy. It has been over 40 years since the Cuyahoga River caught fire and spurred the 1972 passage of the Clean Water Act. The law was intended to target big, point source pollution like sewage leaks and oil spills, and the continuing efforts to use it to ‘clarify’ a definition of navigable water from the 1899 Rivers and Harbors Act does not serve the potable water issues that the nation faces today.

And despite being published as a final rule, this proposal is a long way from being final. 

What LEED Credit is Almost Never Achieved?

One of the key features of the LEED rating systems is that, after satisfying minimum program requirements and prerequisites, project teams may select from the available compilation of LEED credits. Those options are key not only because there is no one homogenous building type but also because owners may have sustainable features they wish pursued.

But surprising to some, there is one LEED credit that stands out, by far, as the least earned. 

Accepting that LEED is no longer only new construction, and in an effort to compare apples with apples, this analysis looked at the LEED New Construction v2009 rating system.

To provide some context, credit NC v2009 EA c1 Optimize Energy Performance was the most often achieved credit, over 97% of the time, that is, on 3,927 of the 4,039 projects certified under this rating system. And such may not be surprising given the weight that LEED places on reducing energy use.

But, NC-2009 MR c6 Rapidly Renewable Materials was earned in just 2% of certified projects. It was achieved only 87 times in the 4,039 projects.

Again for more context, no other credit has achieved only in double digits. That is the next nearest credit was achieved more than a hundred times. 

So, what does NC-2009 MR c6 Rapidly Renewable Materials require,

“Use rapidly renewable building materials and products for 2.5% of the total value of all building materials and products used in the project, based on cost. Rapidly renewable building materials and products are made from agricultural products that are typically harvested within a 10-year or shorter cycle.”

The intent of the credit is noble,

“To reduce the use and depletion of finite raw materials and long-cycle renewable materials by replacing them with rapidly renewable materials.”

But even to the casual observer there is a disconnect between that idealistic goal and actual buildings because it is the rare building that contains any meaningful quantity of cotton, wool, wheatboard, strawboard, cork, corn, rubber or agrifiber.

There is no USGBC list of acceptable agricultural products, but be aware there is a USGBC issued LEED Interpretation #10057 that provides the plants must be "typically regenerated" within 10 years. The Interpretation is a bit cryptic, but farmed trees can be harvested within 10 years, however because harvesting trees in 10 years isn't typical, that lumber might not meet this standard.

Also, LEED Interpretation #2549 says that to count as rapidly renewable for the purposes of this credit, the material must be harvested without causing the animal harm, and the animal must be able to continue to regenerate the material. A good example is wool from a sheep.

Despite that the credit is almost never achieved, some have suggested it is important because materials credits play an ever increasing and controversial role in LEED v4. Not that this v2009 credit is a prequel to a v4 credit (it is not), but rather that USGBC staff weighs the pros and cons of rapidly renewable materials differently than the marketplace. For example, it has been suggested using corn as a plastic substitute in building is similar to the using corn in ethanol versus as food.

These credits for materials are complex, from transparency to life cycle analysis, as is now apparent in the reworking of the v4 materials credits. And maybe it is not so bad that corn has not become a significant building material (the role of corn in fuel is uncertain as EPA acknowledged last week that the statutory ethanol mandate can not be met)?

You can register LEED 2009 projects through October 31, 2016 and pursue MRc6 for years thereafter bettering the 2% statistic. But in lieu of corn, consider wool carpeting and agrifiber products like particle board and plywood (.. yes they qualify). 

HUD Adopts 2009 IECC (Not the 2012 or 2015 version) and Why You Care

The U.S. Department of Housing and Urban Development and the U.S. Department of Agriculture have determined, effective June 6, 2015, that adoption of the 2009 edition of the International Energy Conservation Code for single family homes and the 2007 edition of the American Society of Heating, Refrigerating and Air-conditioning Engineers 90.1 for multifamily buildings will not negatively affect the affordability and availability of HUD and USDA assisted housing. 

You care because this new minimum standard for energy efficiency in housing is widely seen as a benchmark driving green building and impacting significantly more units than LEED.

The two standards apply to different building types: the IECC applies to single family homes and low-rise multifamily buildings (up to three stories), while ASHRAE 90.1 applies to multifamily mid- or high-rise residential buildings (four or more stories)

On April 15, 2014, at 79 FR 21259, HUD and USDA announced in the Federal Register the Department of Energy's determination that the 2009 IECC and ASHRAE 90.1-2007 standards would improve energy efficiency (and yes, DOE has also already made that determination for the 2015  IECC but HUD and USDA are two versions of the code behind) triggering this second step in the federal government analysis.

For the 34 States and the District of Columbia that have already adopted the 2009 IECC or a stricter code, there will be little or no impact from HUD and USDA's adoption of this standard, since all housing in these states is already required to meet this standard as a result of state legislation. In the 16 states that haven’t adopted the IECC for single family homes, HUD and USDA announced the average incremental cost of going to the higher standard is $1,019 per unit.

For impacted HUD programs in the 38 states and the District of Columbia that have adopted ASHRAE 90.1-2007 or a higher standard, there will, by default, be no adverse affordability impacts of adopting this standard. For the remaining 12 states that have not yet adopted ASHRAE 90.1-2007, HUD and USDA estimate the incremental cost of ASHRAE 90.1-2007 compliance at under $500 per dwelling unit.

You also care because most significantly this will advance green building because HUD and USDA will accept certifications for a range of energy and green building standards that require energy efficiency levels that meet or exceed the 2009 IECC or ASHRAE 90.1-2007 as evidence of compliance with the standards. These include the ICC-700 National Green Building Standard, Enterprise Green Communities, ENERGY STAR Certified New Homes, ENERGY STAR Multifamily High Rise, LEED-NC, LEED-H, or LEED-H Midrise, and several regional or local green building standards, such as Earthcraft House, Earthcraft Multifamily, Earth Advantage New Homes, or GreenPoint Rated New Homes.

In addition, several states have adopted energy efficiency codes or standards that exceed the efficiency levels of the 2009 IECC and ASHRAE 90.1-2007, including, for example, the Title 24 California Energy Code in California, Focus on Energy in Wisconsin. And the 2015 IECC in Maryland. HUD and USDA will accept certifications of compliance with these state codes or standards as well as other state codes or standards for which credible third-party documentation exists that these exceed the 2009 IECC and ASHRAE 90.1-2007.

For all intents and purposes federally assisted housing must now be green. And while such is generally viewed as positive and as advancing green building (.. the big winner may be LEED), some worry about the implications for affordable housing and others about the homogenization of American housing by federal government efforts to save the planet. 

Microbeads Ban in Maryland will be more Efficacious than Others

Synthetic plastic microbeads are an effective mild abrasive ingredient appearing since the 1990s in personal care products including facial cleansers, shampoos, and toothpastes.

Environmental interests have sought to ban microbeads contending the plastic microbeads (that look like tiny colorful dots), cannot be treated by conventional wastewater treatment plants, resulting in their discharge into waterways and posing a threat to the ecosystem through ingestion by fish and other animals in the food chain. As a result microbeads arguably pose a potential human health threat when people consume fish and other animals that have ingested microbeads, as well as directly from the pollution of water supplies. 

Overall, the annual per-capita consumption of microbeads from cosmetics and personal care products in the United States is estimated at .0309 ounces per person per year, which adds up to over 300 tons of microbeads being discharged into the wastewater stream each year.

The Maryland legislature passed and last month Governor Larry Hogan signed into law House Bill 216, now enrolled as Chapter 409, prohibiting the manufacture of a personal care product containing “synthetic plastic microbeads,” beginning December 31, 2017, and the sale of such a product beginning December 31, 2018.

The bill defines “synthetic plastic microbeads” as any intentionally added solid plastic particle that is not biodegradable, less than five millimeters in size, and used in a rinse-off personal care product for exfoliation or cleansing purposes. Under the bill, a “personal care product” means a manufactured good or a component of a manufactured good that is intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied to the human body for purposes of cleansing, beautifying, promoting attractiveness, or altering appearance. A “personal care product” does not include a prescription drug. And the bill does not ban microbeads used in science research or fluid visualization and fluid flow analysis.

Illinois became the first state in June 2014 to ban the manufacture or sale of plastic microbeads effective 2018. Since then, Maine, New Jersey and Colorado have passed similar phased-in bans. Legislation is pending in several states, including California, New York, and Washington.

Some contend the bans should also cover even biodegradable microbeads.

But the Maryland law is progressive in responding to the evolving science by requiring the adoption of regulations that identify biodegradable guidelines for wastewater treatment plants and the state must periodically review those guidelines to ensure that the most scientifically effective methods are being used. Today the initial regulations are anticipated to authorize the use alternatives such as crushed seeds and nutshells; however, in the future innovative solutions may be considered, including polyhydroxyalkanoate, or PHA, a naturally occurring plastic like material produced by mushrooms.

Just 2 years ago Hayden Panettierre told us microbeads were chic in this commercial. Today, more than 3,000 consumer products contain plastic microbeads. And now several of the largest producers of personal care products containing microbeads have pledged to phase out microbeads from their products.

In the 80 years since the start of its commercial production, plastic has become integral to our way of life. Many of the desirable properties of plastic, that it is low cost, durable, and corrosion resistance, also contribute to the rate at which it is consumed, discarded and is accumulating in our environment. We recognize the threat when we see plastic six-pack rings entangling wildlife, but just because we cannot see micro plastic smaller than 5 millimeters does not mean that the over 300 tons discharged annually does not exist, and is not a threat that we must address. 

Photo credit 5 Gyres

What LEED Statistics Tell Us?

The U.S. Green Building Council’s LEED rating system dominates brand acceptance and market share in the business of green building and is a driver in the larger environmental industrial complex. So a review of LEED statistics can be telling, not only about the state of green building, but about trends and future opportunities. 

But as Benjamin Disraeli told us, “There are three types of lies -- lies, damn lies, and statistics.” So, to keep this short blog post simple but meaningful we are going to look only at a snapshot that was the  nonresidential projects that were LEED certified during the month of April 2015 as reported by GBIG.

During April 2015, 463 projects were certified comprising 59.4 million square feet.

That is, more than 1.2 million square feet were certified each day in April. While that is a very large number, it is the lightest month this year and on an annualized basis, Green Business Certification, Inc., is certifying more than 1.8 million square feet every day, which is an increase from the 1.7 million square feet per day average in 2014.

Of those certifications it is significant that greater than 30% were Existing Buildings projects and several were recertifications. LEED is clearly no longer only about new construction.

Also interesting is that only 17 of those projects, just over 1%, were identified as schools. Given that schools are the number one project use for LEED certified building, one might have expected that number to be larger.

Rating System

Projects Certified

Square Footage Certified

New Construction


20.9 million

Commercial Interiors


3.5 million

Core and Shell


16.9 million

Existing Buildings


16 million

Retail - Commercial Interiors



Retail - New Construction



Schools - New Construction


1.6 million



59.4 million

Continuing a trend more projects were certified Gold than any other certification level. And those Gold projects were significantly larger than the average project.

With 160 projects achieving at Certified level that number is statistically similar to the 162 Gold projects. No one homogenous building type predominated and the projects were as varied as the Maui Hyatt Vacation Club to a Bank of America corporate center on Charlotte, NC, and a Kohl’s Department Store in Springfield, OH. More Wells Fargo bank branches were certified than any other single user in April and most were at the Certified level. And despite the dozens of Wells Fargo bank branches, Kohl’s certified more square footage than any other single owner in April (.. which is not surprising when considering at 3,866 square foot bank branch versus as 96,077 square foot department store).     

Certification Level

Projects Certified

Square Footage Certified



10 million



13.4 million



33.7 million



2.2 million

LEED is increasingly international and while 378 of the 463 April projects were located within the U.S., the remainder were scattered across the globe in 32 different countries. The largest number of those international certifications were in China with 15 projects totaling 5 million square feet. 10 projects were in Brazil, 7 were in Turkey and 6 each were certified in India and Germany. And there were single projects certified from the United Kingdom to Argentina and from Nigeria to Colombia.  

This snapshot from April makes clear that the state of LEED brand acceptance and market share is good and is growing.

Check out USGBC's LEED project directory for a look at LEED projects by state. And visit GBIG to analyze LEED trends and opportunities in the business of green building.

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An Arm and a Leg and the 2015 International Energy Conservation Code

The 2015 version of the International Energy Conservation Code is soon to be upon you.

Modern building codes are most often adopted by local government legislative bodies and as such vary from place to place. The IECC is in use or adopted in 47 states, the District of Columbia, the U.S. Virgin Islands, New York City and Puerto Rico. 

By way of background, the International Building Code, as published by the International Code Council establishes “the minimum requirements to safeguard the public health, safety and general welfare …” The ICC also developed the IECC, encouraging energy conservation through efficiency in design, mechanical systems, and lighting systems. An energy conservation code is a major expansion from the life safety mission of building codes. Many suggest that the IECC has had much more impact on high performance building than has LEED.  

The IECC 2009 is widely adopted across this country because a commitment to adopt it was a precondition to states receiving stimulus funds under the American Recovery and Reinvestment Act of 2009 from the federal government.

There is an IECC 2012, but its adoption has been slow because its energy efficient performance is about 30% higher than the 2009 code, which is a significant increase. More than half of the country is currently under the 2009 IECC. Now the IECC 2015, with 77 changes from the 2012 version, has been published and is ready to be adopted. It is published in a single volume with ASHRAE Standard 90.1-2013 Energy Standard for Buildings Except Low-Rise Residential Building.

On January 1, 2015, the State of Maryland became the first state to adopt the 2015 IECC with local government adoption and enforcement required throughout the state by July 1, 2015. 

In terms of overall energy impact, the 2015 IECC is only negligibly different than the 2012 version. It is, however, accepting that there is no one homogenous building type, a slightly more than 1% better energy impact for commercial building than the 2012 IECC.

Many are being heard to argue that the time, inconvenience and expense of implementing a new code with only a slightly more than 1% better energy impact is unwise.

A U.S. Department of Energy technical analysis of the 2015 version determined only about 6 of the 77 total changes actually increase energy savings. The vast majority, that is, over 60 of the changes require new materials and methods but are energy neutral and 3 arguable have a detrimental effect on energy savings.

But because the DOE has determined the revised code improves energy efficiency in residential buildings, even ever so modestly, states are statutorily required to certify that they have reviewed their residential building code regarding efficiency, and made a determination as to whether it is appropriate for such state to revise their code to meet or exceed the provisions of the successor code. This only applies to residential codes.

There is no doubt that, in large measure because of adoptions of energy codes, energy efficiency has increased significantly. With a goal of reducing energy use, energy codes are of great import to green building. Critics have, however, effectively questioned the efficacy of using a mandatory code, that is little known and rarely debated burdening real estate with addressing a single societal issue (without balancing matters of resilience, public safety, etc.), and pointing out that this all looks a lot like establishing a national energy standard for every building.

Whatever, your perspective on legislatively mandated continued reduction in building energy use, be aware that the 2015 version of the IECC, including the required changes in building systems and products and the associated increases in first costs, may soon be upon you.