What's On the Horizon for Green Building Law in 2010?

[Happy New Year!

Today we are highlighting the green building legal story from 2009 that will have the most impact on the industry in 2010.  At the beginning of 2009, Congress and the Obama Administration spent months crafting the American Recovery and Reinvestment Act, which eventually included over $25 billion for green projects.  Less attention was paid to how these ARRA funds would be administered.  The story below suggested that states and cities may have trouble administering ARRA green funds.]

"The Stimulus: Now for the hard part"

On February 17, CNN ran the above headline after President Obama signed the stimulus bill.  To me, a more perfect headline could not have been written. 
 
Ever since I read about the stimulus bill, one particular nuance has interested me:  the package does not include earmarks.  Due to the lack of earmarks, the hardest part of the stimulus bill may be administering the $787 billion in funds. 

The lack of earmarks has important implications for state and federal energy programs throughout the country.  Without earmarks, state energy offices will have wide-ranging discretion in doling out large sums of money not previously seen: 

The biggest test of the administration’s energy goals may come in spending the billions that have been devoted to states and cities for improving energy efficiency.  To get the money out quickly, the plans sends it through a range of programs that are not accustomed to seeing funding on this scale.  State energy offices that annually receive less than $100 million combined from Washington are slated to receive $3.4 billion. 

A recent NPR story, "Earmark-Free Stimulus Bill Lacks Spending Direction", focused on the potential problems that may arise when the money is sent to the states:  
 
When this bill passes, a Niagara Falls of money will flow out of Washington and into the accounts of state highway commissioners, governors and legislatures, local school boards, county executives -- even mayors, [the Brookings Institution's Sarah] Binder says.

"It raises a whole host of questions about how efficiently money can be spent, how effectively it will be spent, how quickly money can be spent, just because there's no set process here for determining how money will get out the door to create jobs or, as the president said, to save jobs," she says.

In one particular instance, a South Carolina official who runs the state’s energy efficiency programs, will be tasked with managing large sums of money and finding proper projects and programs for the money:
 
In South Carolina, the state energy office is so small that its director, John Clark, answers the phone.  He said his office, which receives $.15 million per year, has put out an urgent call to state offices and school districts for energy-saving projects to receive.  He will also have to advise the state’s cities and counties, which have even less experience in big energy efficiency projects and are slated to get $35 million of their own from a separate $3.5 billion block-grant program in the package.”  
 
While Republicans, Democrats and the President argued over the stimulus package for weeks, the real battle may arise when state agencies and officials attempt to divide up the stimulus funding and choose the projects that receive funding.  How are you planning to seize the opportunities that arise from the stimulus? 

A Recipe for Green Building Litigation

The American Recovery and Reinvestment Act (ARRA) projects have resulted in extremely low bids.  These low bids could be the result of improved efficiency in the construction industry; or the low bids could be the result of cut throat competition.  
 
Simultaneously, the ARRA includes $250 million to investigate (PDF) and audit ARRA projects.  These investigations and audits will most likely occur when contractors make claims for modifications and change orders. 
 
This is a recipe for litigation.  And with $25 billion in ARRA funds going towards green building projects, the stage is set for green building litigation. 

Colleague Steve McBrady recently explained how the federal government will use ARRA funds to investigate contractors:  

“These days, there are more companies competing for comparatively fewer contracts, and that means contractors are facing downward pressure on their bids,” McBrady said. “The key for contractors is that it is OK to be competitive, but that bids should accurately reflect the cost to execute the work. Government officials are going to be on the lookout for contractors who make false claims, such as inflating costs for work conducted under change orders.”

Another colleague, George Ruttinger, recently highlighted the various agencies that will receive the $250 million (PDF) set aside for audits and investigations of ARRA projects.  The cast of characters that will be involved in ARRA investigations is long:
  • GAO
  • Agency IGs
  • RAT Board
  • National Procurement Fraud Task Force
  • Congress
  • DOJ Antitrust Division 
  • State and local auditors
  • Whistleblowers
  • The Public 
If you are concerned about the implications of ARRA investigations, I suggest you review the presentation Rewards, Rules and Risks of Doing Stimulus Business -- An Introduction to the American Recovery and Reinvestment Act of 2009: Implications for Construction Contractors.  You can learn more about the funding and players involved with ARRA investigations and, most importantly, what you need to do to remain in compliance.
 
Related Links
 
 
 
 

Photo:  zenosparadox

District of Weatherization

Reminder:  Don't forget to register for Green Building Law Update's Birthday Happy Hour

Sometimes, my fair city of Washington, D.C. can drive me crazy. There is no doubt we have our issues.

But one thing Washington, D.C. has going for it is its push to become more green. D.C. is at the forefront of the green building movement and it is taking full advantage of American Recovery and Reinvestment Act funding:

The District of Columbia will receive $8.1 million in federal funds to support its weatherization programs for low-income residents. The funding is part of a United States Department of Energy grant to the District under the American Reinvestment and Recovery Act. It will allow the District to weatherize an additional 785 homes over the usual workload of about 400 in the same period.

I have received a number of inquiries about the requirements for eligibility under the weatherization program. Here are the income requirements in D.C.:

If you have questions about eligibility for the weatherization program in your region, I would recommend reviewing the website dsireusa.org.

Finally, here is a great video put together by the White House about the D.C. weatherization program. This has me feeling (gulp) hopeful. Watch this and tell me Van Jones is not the coolest environmentalist on the planet.

 

Links:

District To Weatherize Hundreds of Additional Homes (DDOE)

Database of State Incentives for Renewables & Efficiency (DSIRE)

Green Jobs for a Green Future: Weatherization (YouTube)

DOE Stimulus Project Opportunities Are Available

Note:  Don't forget to register for Green Building Law Update's Birthday Happy Hour

This week we will be taking a look at green building and renewable energy funding available through the American Recovery and Reinvestment Act. While the opening of the stimulus spigots has been slow, there has been a noticeable uptick in news the last few weeks.

Today we will look at the Department of Energy; Wednesday we will check in on the General Services Administration; and Friday, we are going local to see how Washington D.C. is using weatherization funding.

If you are in the renewable energy sector, you may want to take advantage of a recently announced loan guarantee program made available by the Department of Energy:

The Energy Department is making available $36 billion in loan guarantees for renewable energy projects and for modernizing the electricity grid.The department said Wednesday it will accept applications for the financing support over the next 45 days.

The government-supported loans are expected to help companies involved in solar, wind, biofuels and other renewable energy projects get private financing. It also aims to spur investments in power grid improvements. 

To learn more about the Department of Energy's loan guarantee program, check out their loan guarantee website.

In addition, other opportunities remain available at the Department of Energy.

DOE's Energy Efficiency and Renewable Energy Program Office is reporting that of the $16,796,000,000 it was allocated, only $3,534,031,000 has been obligated and $63,362,000 has been spent. Many of the deadlines have already passed for the DOE projects so check in now to see where you can benefit.

Anyone had any luck with DOE stimulus projects?

Links:

Department of Energy Loan Guarantee Program

DOE Makes Available Energy Loan Subsidies

Recovery and Reinvestment at the Department of Energy: Welcome

Recovery and Reinvestment at the Department of Energy: Funding Opportunities

Green Building Law Update: Stimulus

Photo:  rebuildingdemocracy

Reporting Green Jobs is Tricky

If you are a contractor lucky enough to have won a stimulus project, one of the pesky requirements attached to the project is reporting the number of new jobs created by the project.  Many builders and contractors have been wondering how exactly to do that.  Finally, at long last, the White House has provided clarity

''Just count the people being paid out of Recovery Act dollars,'' said Rob Nabors, deputy director at the White House budget office.

 

Wait, that didn't answer all the questions out there.  If someone was already working for you, do they count?  What about subcontractors?  If you receive multiple stimulus contracts and employ the same person for both jobs, is that one job or two?  Maybe there is further clarification:  

''This whole thing is tricky. I'm not going to pretend it's not,'' Nabors said. ''This whole effort is virtually unprecedented.''

Oh, now I get it!

The reporting of ARRA jobs is going to be an extremely confusing and important issue for all parties. Back on June 22, I wrote:  "As we draw closer to the 2010 election cycle, you can bet that politicians who supported the ARRA will be looking to tout green jobs that were created." 

Turns out, the federal government isn't the only one hoping to tout good job creation numbers:

If the numbers are to be reliable, however, states, cities and contractors must report honestly. White House officials know there are political and financial incentive to cheat: Contractors can use job-creation data as a public relations ploy. Local politicians can turn job numbers into campaign literature. And states that use the money well could be in line to get more of it.
 
In the absence of these rules, some states have announced jobs based on out-of-date formulas, leading to implausible estimates. Ohio officials, for instance, have estimated that a $20 million bridge construction project will create or save 10,500 jobs.

As funds for green building projects start flowing from the General Services Administration and the Department of Energy, everyone will be paying attention to the number of green jobs created by these agency projects.  If you have to report green jobs, be extra careful that you follow the reporting requirements, whatever those requirements may be.

Photo:  talkradionews

Contractors Must Report Green Jobs

Here's an update on "green job" requirements created by the American Recovery and Reinvestment Act. Previously, I wrote

To my knowledge, there is no requirement or guarantee in the American Recovery and Reinvestment Act to create a certain number of "green jobs."

While this is still the case, there are job creation reporting requirements that will likely be used to categorize the number of green jobs created by the ARRA.

Federal agencies must report more than 40 separate pieces of data regarding their stimulus spending to a central repository — and contractors are required to submit similarly detailed reports for all work funded in whole or in part by the stimulus legislation.

The deadlines are clear. What’s less clear is how to submit reports and arrive at certain calculations, such as the number of jobs created or saved by the stimulus-funded work.

The Office of Management and Budget should be coming out with reporting requirement guidelines for contractors soon.

If you are a contractor lucky enough to have successfully bid a stimulus project, pay close attention to future guidelines released by OMB. As we draw closer to the 2010 election cycle, you can bet that politicians who supported the ARRA will be looking to tout green jobs that were created.

Of course, the big question remains, will the ARRA result in a surge in green jobs? I'm not an economist but I can report I have noticed a surge in green startups the last two months. As we slowly emerge from the recession, and as green stimulus funds finally start to flow, look for huge opportunities and resulting success stories from startup green companies.

My money is on a lot of new green jobs being created.

Some Cities Are Not Ready for Green Stimulus Funding

Back on February 20, 2009, I said the following about the American Recovery and Reinvestment Act:

While Republicans, Democrats and the President argued over the stimulus package for weeks, the real battle may arise when state agencies and officials attempt to divide up the stimulus funding and choose the projects that receive funding.

The real battle is now upon us.

The New York Times has written a fascinating article highlighting the benefits, and potential troubles, associated with clean-energy stimulus funds that will soon begin flowing to cities and towns. The article really paints a picture of potential waste and "headache" that may result from these funds. I was particularly struck by this section:

But the sudden flow of federal funding is raising questions about whether many of these communities are really ready for it.

Some 1,000 cities and counties have direct access to the new entitlement account, the Energy Efficiency and Conservation Block Grant Program. They have until June 25 to submit plans, but that's a challenge, because most haven't received federal grants for energy projects before.

Many communities are having trouble retaining enough police officers, let alone hiring sustainability professionals who understand how to establish energy efficiency programs that will evolve into long-term savings in power and money, experts say.

"Some cities are ready for this, others aren't," said Mark Wolfe, executive director of the Energy Programs Consortium, which helps state energy programs establish efficiency policies.

Many cities are using the stimulus funding for energy efficiency retrofits or even LEED certification:

  • "Las Cruces expects to receive $888,000. Henry said it will help pay for a solar array and "all the green stuff" on an old adobe bank the city is converting into a natural history museum that will be certified under the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) guidelines. The project will cost about $6 million."
  • "Take El Paso, Texas. The sprawling city is due to receive $5.8 million in energy efficiency grants. It will use $3 million of that to help finance a $15 million "performance contract" program aimed at cutting energy use 30 percent in 52 public buildings."

According to the article, in a recent meeting, the DOE also suggested that cities and towns could use the funds to create "carbon trading markets." I don't know about you, but municipal officials new to environmental policy might be better served retrofitting existing buildings instead of creating a complicated, regional carbon trading market.

Complaints About Green Stimulus Projects Emerge

It’s no surprise that there is intense competition for stimulus projects.  Competition can be good and result in more efficient construction.  But competition can also lead to complaints, disputes and even litigation.  

Connecticut is experiencing intense competition for stimulus funding.  

"There's nowhere near the amount of money for individual projects that people thought there was," one senior lobbyist lamented.

Still, advocates and their clients ask whether putting solar panels or a geothermal roof on a planned new building would qualify them for some energy funds (it might); they ask about the permit process (a bill to expedite project approvals has yet to be passed by the legislature); and they want to know how the feds define a stimulus 'job' (still not clear). 

When I read this article, I couldn’t help but notice the complaints about the "green" stimulus projects:  

In her meeting with Fritz, Cheri Quickmire, director of Common Cause of Connecticut, noted that a portion of the stimulus money must go to create "green jobs."

"How does a road-paving project create a green job?" Quickmire said last week, recounting her conversation with Fritz.

To my knowledge, there is no requirement or guarantee in the American Recovery and Reinvestment Act to create a certain number of "green jobs."
 

Stimulus funding for green building projects will help the industry grow.  Complaints about the administration of green building stimulus funds, though, should be of concern to the industry.  Complaints mean bad press.  Complaints mean bid protests.  Complaints mean litigation. 



 

Have you heard any rumblings about green stimulus projects?

Weatherization Funding Announced, Competition Fierce

Back in March, I highlighted that $5 billion in funding had been dedicated to weatherization assistance as part of the American Recovery and Reinvestment Act.  Six short months later, the weatherization funding is scheduled to begin flowing:  

Final applications for the federal weatherization funds were due this month, with the first $2.5 billion expected to reach the states by September. Ohio has announced tens of millions in federal spending and plans to begin spending money for weatherization projects June 1, providing former workers such as Posey hope that they can regain their $18-an-hour assembly-line jobs.

When I ask people about stimulus projects, I keep hearing the same thing:  competition is fierce.  Here’s anecdotal evidence of the intense competition for stimulus projects in Ohio:  

More than 25,000 proposals have been filed on Ohio's stimulus Web site alone. "There's got to be $50 or $100 in requests for every $1 we've got," the state budget director, J. Pari Sabety, said several weeks and several thousand requests ago.

Are you seeing intense competition for green building stimulus projects?

Stimulating Green Guide to the ARRA

Back in March, I gave a presentation about green building funding available through the American Recovery and Reinvestment Act ("ARRA").  I had planned to convert the presentation to a guide of sorts, but more pressing matters arose. 
 
I have now discovered what I hope the guide would have looked like if I had a month to work on it. 
 
Thanks to the fine folks at the Green Research Council, I was able to review their publication, "Green Guide to the 2009 Stimulus Package."  This guide is packed with information about the American Recovery and Reinvestment Act.  The Guide starts with a review of the stimulus and where to get information about particular projects being funded.  I have been telling people that due to transparency demands of the Obama Administration, there is a ton of information available about the stimulus projects.  The Guide does a great job bringing all of the information together in one place. 
 
The Guide goes on to provide information about stimulus funding for Department of Energy initiatives, energy tax credits, EPA environmental projects and green building initiatives.  Finally, the Guide wraps up with general advice for those seeking to procure green projects or jobs. 
 
If you want eighty-eight pages of useful information regarding the green components of the stimulus, this Guide is well worth the $30. 

Stimulus Bids Pour In

According to a recent Washington Post article, “Construction firms are so eager for work in the sagging economy that project bids are coming in much lower than expected.”

Great news, right?  Not necessarily.  Lower bids can be a good thing if they are the result of increased efficiency in the construction process.  But lower bids can also be the result of increased competition.  These lower bids can be just that - too low - and result in delays and litigation. 

What factors are causing the lower bids on stimulus projects?  According to Kenneth Simonson, chief economist for the Associated General Contractors of America: 

"Wherever I go, I hear of projects that used to attract two to three bids just a couple of years ago, now it's 20 or 30," Simonson said. "Many [contractors] are coming down on the minimum size of projects they will bid on, and ones who didn't do schools now are bidding on schools. Others are coming from out of state to a new region just to keep busy. And they are essentially giving away their services just to keep their key employees busy."

Why should this be a concern to the green building industry?  As I have detailed, the stimulus is providing nearly $25 billion for green building projects.  The green building industry is newer, the parties more inexperienced, and the technology relatively untested.  The opportunity for underbidding these green building projects is tremendous.  Projects that can't be completed at the promised cost could lead to LEEDigation. 

Be careful with your bids. 

Photo:  Jim Frazier

 

D.C. Energy-Efficiency Funds for Solar, Reusable Bags

When you heard that the Department of Energy would be providing $3.2 billion for Energy-Efficiency and Conservation Block Grants to states, what kind of programs did you have in mind?

I imagined weatherization of the leaky, old buildings in Washington, D.C.  I imagined an incentive program to build green in D.C.  I am imagined solar panels on every row house.  The last one is out there, but you get the point.  It appears that D.C. will use its Department of Energy funds for some solar panel development and for an advertising campaign that includes distribution of reusable canvas bags: 
"In D.C., environmental leaders have split the District's pot between $4.8 million for solar panels on 20 schools and curriculum additions to help those students be watchdogs for energy waste in their schools, as well as a $3.5 million advertising campaign that includes distributing canvas bags and compact fluorescent lighting to residents in exchange for plastic bags and incandescent bulbs." 
Funding solar panels on schools is a great idea.  Even better, the District plans to tie the program into school curriculum.  By getting the kids involved, D.C. will now have hundreds of eyes on school energy use and the students themselves can work to reduce their energy usage.  Makes sense to me. 

In order to make sense out of D.C.'s use of stimulus funds for canvas bags, you have to understand broader political issues in the City.  The Washington Post recently reported "a majority of the D.C. Council supports legislation that could tax not only plastic bags, but paper ones" at $.05 a pop.  Opponents are now gearing up to oppose the plastic bag tax.   By using stimulus funds to provide reusable bags to residents, the D.C. Council likely faces less opposition from its constituents.

I have no desire to debate the merits of the plastic bag tax, although you can discuss the issue further in the comments section.  Instead, my question is whether the purchase of reusable bags is an appropriate use of Energy Efficiency and Block Grant stimulus funds.  Thoughts

Wave of LEEDigation

Last week, I attended the ABA Forum on Construction “Talking Green Blues” conference in New Orleans.  The one presentation I was looking forward to the most was “When ‘Green’ Turns to ‘Red’ and ‘LEEDs’ to a Summons and Complaint,” which was moderated by Frank Musica.  Musica is one of the foremost experts on green building claims.  I wrote about Musica's presentation "Don't Let Green Design Cause Red Ink" in September, 2008 and refer to it often when discussing potential problems with green building. 

One of Musica's opening remarks really caught my attention:

"We are about to see a second and much larger wave of green building claims." 

Go back and read that quote again.  This is serious.  This is a big deal for the green building industry. 

Why do Musica and I expect a surge in green building claims in the coming months and years?  I highlighted many of the reasons in my "Green in the Stimulus" slideshow.  The presentation highlights the opportunities, but also the risks, inherhent in green building stimulus projects: inexperienced government entities will have unrealistic expectations of green building projects.  These same entities will also require guarantees of LEED certification or energy performance, or both.  The contracts for these projects will be extremely important. 

The wave of LEEDigation is coming.  Can you swim?  Can your attorney? 

Energy Department Releases Funding Amounts

[Sometimes, it's better not to reinvent the wheel.  As I was preparing this week's posts, I came across Lane Burt's analysis of the Department of Energy's (DOE) stimulus funding.  Lane, an NRDC Policy Analyst, agreed to let me use his post today.  Check out Lane's blog - it's a great resource for energy policy analysis.]   

DOE released the funding distribution for the Energy Efficiency and Conservation Block Grants (EECBG) from the recovery act (ARRA) late last week. With this action, we now know as much as we are going to about the destination of the clean energy dollars.

The big ticket items for clean energy were,

  • $5 billion for low income weatherization (WAP)
  • $3.1 billion for state energy programs (SEP)
  • $3.2 billion for the local block grants (EECBG)
  • $4.5 billion for greening GSA facilities

I blogged on the funding breakouts here and here,

We aren't going to get more clarity on the destination of the GSA funding. GSA has a list of projects across the country, but details have yet to be released and GSA is not required to do so.  [Ed. The GSA released its project list after this post.]

The money for state energy programs and low income weatherization is distributed according to an existing formula that sends a baseline allocation out and divides the remainder, 1/3 weighted according population, 1/3 by consumption, and 1/3 equally. The text of the law is here,

Now, DOE has released the funding amounts for EECBG and a nifty little interactive map so you can see where all the funding (SEP and WAP included) is headed.  More detailed state by state info here, including city by city breakouts for the local block grants.  A few clicks show me that my home state of North Carolina is getting $266 million dollars and my hometown of Charlotte is getting close to $7 million of that.  New York recieves $693 million, California gets $764 million and Texas gets $755 million.

Decision time

DOE is doing everything they can to get this money out now. How it gets spent (in the case of SEP and EECBG) is now a state or local matter and there is a lot of discretion given to states and localities on how to spend it. The potential impact of this money is incredible if used properly to save energy and create jobs, but the potential for waste is also very high.

Because of the potential for waste, there are two words that should guide every state, county, and local official in spending this money - Prioritize Efficiency. I cannot say this enough. It is faster, cheaper, and cleaner than any alternative and it is the only way we can spend now to save us money in the future. It supports local jobs and keeps dollars in the local economy. No one can find a stimulus proposal better than the one that will leave you with more money than you started with in just a few years.

GSA, Energy Department Understaffed

While the General Services Administration announced stimulus projects last week, they have no time to rest.  In fact, choosing the stimulus projects may have been the easiest part of the process.

The next step is contract procurement and administration.  Due to staffing vacancies at the GSA, the administration process may prove difficult

"Meanwhile, the ranks of contracting officers who make the day-to-day contracting decisions at the GSA have been shrinking since 2005, through attrition, outsourcing and a convoluted federal hiring process that many say discourages talented people from applying."

The GSA is not the only federal agency that is currently understaffed and tasked with administering billions in stimulus funds.  The Department of Energy must figure out how to administer over $38 billion in stimulus funds and the DOE Office of the Inspector is being upfront about the difficulties the agency is facing:

"The infusion of these funds and the corresponding increase in effort required to ensure that they are properly controlled and disbursed in a timely manner will, without doubt, strain existing resources."

In reading the DOE Inspector General's Report, it seems almost inevitable that some fraud will occur:  "As the Recovery Act implementation proceeds, all parties should recognize that the potential risk of fraud increases dramatically when large blocks of funds are quickly disbursed."

How can these understaffed agencies avoid fraud?

GSA's Green Stimulus Projects

General Services Administration, I am impressed. 

The American Recovery and Reinvestment Act mandated that the GSA determine projects that would receive $5.5 billion by April 3, 2009.  The GSA beat this mandate, making its list of projects available on April 2, 2009 (hat tip to the Washington Business Journal for breaking the story ).

If you were hoping to benefit from the GSA projects in the D.C. metro area, you have a much better opportunity of working on these projects in the District than in other surrounding localities.  D.C. is set to receive $1.2  billion for GSA projects.  According to the Washington Business Journal, "the amount of work slated for D.C. appears to be more than any other jurisdiction. By contrast, GSA plans to modernize only five buildings for $66 million in Virginia and two buildings for $25 million in Maryland."

A full list of GSA projects receiving funding is available here.  Here's a list of GSA projects in D.C., Virginia and Maryland slated to receive funding:

Washington D.C.

  • Department of Homeland Security headquarters, St. Elizabeths Hospital west campus, Southeast, $450,000,000
  • Department of Commerce Herber Hoover Building (phase II and III), 14th Street and Constitution Avenue NW, $225,638,000
  • GSA headquarters (phase I), 1800 F St. NW, $161,293,000
  • Lafayette Building (phase I), 811 Vermont Ave. NW, $128,827,000
  • Mary Switzer Building (phase II), 330 C St. SW, $68,241,000
  • Department of Interior Building (phase IV), 19th & C streets NW, $63,450,000
  • Department of State Truman Building, 2201 C St. NW, $14,735,000
  • Veterans Administration, $1,499,000
  • Lyndon B. Johnson Federal Building, $4,162,000
  • Elijah Barrett Prettyman Courthouse, $3,662,000
  • IRS Building, $1,506,000
  • Ariel Rios Fed Building, $1,337,000
  • GSA-Regional Office Building, $592,000
  • Wilbur J Cohen Building, $16,701,000
  • Winder Building, $1,865,000
  • Theodore Roosevelt Building, $23,551,000
  • Robert C. Weaver Building, $3,663,000
  • Howard T. Market National Courts, $2,070,000
  • Tax Court, $8,083,000
  • 601 - 4th St, NW, $2,150,000
  • US Secret Service Headquarters, $1,601,000
  • EPA East and West and Connecting Wing, $4,564,000
  • Reagan ITC and Garage, $16,161,000

Virginia

  • Franconia Warehouse, Franconia, $9,512,000
  • Martin V.B. Bostetter Courthouse, Alexandria, $1,699,000
  • Advanced Systems Center, Reston, $690,000. 
  • Poff Federal Building, Roanoke, $50,968,000
  • Robert Merhige Courthouse, Richmond, $3,500,000

Maryland

  • New Carrolton Federal Building, Lanham, $1,647,000 
  • CMS HQ Complex, Woodlawn, $23,723,000

The federal website, www.fedbizopps.gov, should have more information about these projects very soon.  Any luck finding information? 

Wondering how to successfully bid these projects?  My "Getting Green from the Stimulus" slideshow is a good start.

Photo Credit:  JPhilipson

Green Building Thoughts: The Stimulus, The Bond, LEED AP, and Rock Chalk

It may surprise you to learn that I have a real job.  Seriously, I do and I love it!  I am a construction litigator and I am currently involved in a major construction delay claim.  I have been preparing a motion the last few days, hence the late filing of today’s post. 

There is a lot going on in the green building world.  The Stimulus.  D.C.’s unique green building bond (i.e. the green building unicorn).  LEED AP exam deadlines.  And also a little basketball.  I often don’t have time to touch on all the issues I would like, so today, I provide you my thoughts on these many issues. 

The stimulus.  In my “Green in the Stimulus” slideshow, I indicated that the General Services Administration has until April 3, 2009 to prepare a list of federal projects to receive stimulus-funding.  While that is true, apparently the GSA does not intend to release this list on April 3:  “Morris said a list of stimulus-funded projects is being vetted by the administration, but he could not give a date for the list’s release.”  Stay tuned for further details.

The D.C. Bond.  You may have noticed that I have been writing a lot about the D.C. Green Building Act's performance bond requirement.  It seems the issue takes a new turn everyday.  The most recent rumor is that the D.C. may incorporate the green building bond into zoning requirements.  How are we going the wrong way on this?  Look for a guest post next week on the issue. 

The LEED AP Exam.  I get a lot of google hits from people trying to decide if they should take the LEED AP exam.  My general thought is that if you are interested in a career in green building and you have some free time and money, you should take the exam.  You do know the deadline to sign up for the LEED AP exam is March 31, right?  Also, the Green Building Certification Institute recently announced that you actually have to take the LEED AP exam by June 30, 2009.   

The Defending Champions.  Finally, it is my favorite time of year.  It is the time of year when the University of Kansas Jayhawks take flight.  In addition to my job and this blog, I also am just a little bit COMPLETELY AND UTTERLY (ed: my fiancee made this change) obsessed with Kansas Jayhawks basketball.  Always have been, always will be.  I hope Sherron Collins, Cole Aldrich, Bill Self and company continue rolling and dispatch of the Spartans in quick fashion tonight.  Rock Chalk Jayhawk! 

Photo:  ruralocity

DOE Releases Weatherization and Energy Efficiency Stimulus Funding

Well, that wasn't much time to get prepared. 

The Department of Energy has released the first installment of funding for the Weatherization Assistance Program and the State Energy Program

"To jump-start job creation and weatherization work, the Department of Energy is releasing the first installment of the funding - about $780 million -- in the next few days.  The Department will release additional funding over time as states demonstrate that they are using the funding effectively and responsibly to create jobs and cut energy use."

The Weatherization Assistance Program seems fairly straightforward.  Through the program, "an average investment of up to $6,500 per home in energy efficiency upgrades and will be available for families making up to 200% of the federal poverty level - or about $44,000 a year for a family of four."  

The administration of the State Energy Program funding is a bit more murky.  According to the DOE, State Energy Program funding "will be available for rebates to consumers for home energy audits or other energy saving improvements; development of renewable energy projects for clean electricity generation and alternative fuels; promotion of Energy Star products; efficiency upgrades for state and local government buildings; and other innovative state efforts to help save families money on their energy bills."

In the coming weeks, Green Building Law Update will monitor stimulus funding at the state level.  How do individuals apply for weatherization funding?  What programs will be funded through the State Energy Program?  I hope to answer these and many more questions. 

Related Links

 

Getting Green from the Stimulus

As promised, below is the slideshow from last week's "Green in the Stimulus" presentation as part of Rutherfoord's Trends in Green Building seminar.  Unfortunately, I have not figured out how to synchronize audio files with a slideshow - maybe next time.

I had two goals when I created this presentation:

(1) Explain the green building provisions in the stimulus package.
(2) Convey how parties can prepare themselves now to take advanage of resulting green buiding opportunities. 

You can be the judge whether I succeeded.  The slides, by themselves, do not do the presentation justice.  If you are interested in hosting the "Green in the Stimulus" presentation for your company, please contact me at chris@greenbuildinglawupdate.com.  The presentation can be tailored to your specific state or region and industry. 

 

The Stimulus: Now for the Bad Part

http://www.flickr.com/photos/27563796@N06/2736542613/Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.

Thank you to everyone who attended Rutherfoord's "Trends in Green Building" seminar yesterday and listened to my "Green in the Stimulus" presentation.  It was great to recognize so many faces in the crowd.  If you came up and spoke to me about speaking engagements or green building legal programs offered by my law firm, please follow up with me so we can make it happen.  For those of you who missed the event, I will post the powerpoint I presented to Green Building Law Update (hopefully with a voiceover) on Monday. 

Now for the bad part. 

The stimulus package is going to result in increased levels of green building litigation. I hope I am wrong, but I think it is inevitable. 

In my "Green in the Stimulus" presentation, I highlighted three factors that will contribute to an increase in green building litigation.  The first factor is an influx of inexperienced parties attempting to build green.  There are many state and local governments that, to date, have not been substantially involved in the green building industry.  These entities, with the help of the stimulus funding, are now going to require green building projects through regulation.  Here is an example.  These state and local governments will be required by the timelines of the law to fast track these green building developments.  Do you see the problems that can arise from this scenario?

The second factor will be the requirement that projects attain LEED certification.  The website of the General Services Administration states:

As of 2003, all new GSA building projects must be certified through the Leadership in Energy and Environmental Design (LEED) Green Building Rating System of the U.S. Green Building Council, and Silver LEED rating is encouraged. 

The GSA will not be the only entity requiring LEED certification for projects.  Who will be responsible for achieving the LEED certification?  What happens if the project fails to achieve the LEED certification?

Finally, the third factor that will result in more green building litigaiton is the emphasis on energy efficiency.  The drive to build green primarily centers around the desire to reduce building energy use.  However, it is very difficult to anticipate how a building will actually perform.  Under the LEED rating system, energy efficiency is modeled through ASHRAE.  Buried deep in a ASHRAE appendix (ASHRAE 90.1, Appendix G, Section G1.2, Note 2) is the following disclaimer:

"Neither the proposed building performance, nor the baseline building performance are predictions of actual energy consumption or costs for the proposed design after construction. Actual experience will differ from these calculations due to variations such as occupancy, weather, energy use not covered by this procedure, changes in energy rates between design of the building and occupancy, and the precision of the calculation tool."

Not every government or municipality will see or understand this caveat.  Heck, many of the entities requiring certification don't even understand the acronym for the LEED rating system.  What happens when the new green buildings don't actually reduce energy usage? 

I am not the only one concerned about these issues.  Real Life LEED initially raised factor three.  Are we wrong?  Tell me. 

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The Stimulus: Build Relationships Now

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.

I am wrapping up my "Green in the Stimulus" presentation for tomorrow and wanted to provide more information that may benefit your company as you seek out green stimulus projects. 

As you prepare to bid federal and state projects, relationships will be key.  You will need relationships with general contractors or subcontractors to facilitate your bid.  Relationships with the government officials that are creating or letting the government projects can also be helpful.  I am convinced that in the stimulus bidding process, information is power.  Government officials can provide information about requirements and preferences for green stimulus projects. 

How do you develop relationships with these government officials?  Here is an idea. 

Like Virginia, Maryland has developed a stimulus website .  Unlike the Virginia stimulus website, Maryland does not provide information about proposed stimulus projects.  But other information on the website may prove valuable. 



The Governor's office will be providing "Workshops for Local Leaders" related to the stimulus package.  The event is free.  You do not have to register. 

If you are in Maryland and you want to learn about stimulus projects and talk to the officials in charge of these projects, why would you not go to one of these events? 

Related Links: 

The Stimulus: States Have Green Too

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.

This week, in preparation for my "Green in the Stimulus" presentation, I have been providing what I hope is interesting and useful information about the stimulus.  Today we are briefly going to review a new website in Virginia, Stimulus.Virginia.gov, which is vitally important to anyone expecting to take part in Virginia projects resulting from the stimulus. 

According to Stimulus.Virignia.gov, the "website is a forum for citizens, localities, and others to submit project proposals to be considered when federal stimulus funds become available."  In its current iteration, the most interesting aspect of the website is the "Reports" section .  This section lists projects that have been submitted to the website by municipalities and individuals.

I have skimmed this list and was amazed to see that the very first project was a school seeking LEED certification. 

Do you realize the opportunity that Stimulus.Virginia.Gov, along with FedBizOpps.gov, provide?  Through these two websites, you can inventory all of the potential projects you would want to bid on and begin preparing for these projects now.   Plenty of other states have similar stimulus websites (Ohio and Michigan, for example) so these actions aren't limited to Virginia. 

How do you prepare for these projects now?  What are the risks that have to be accounted for and what should your contracts look like?  You will have to come to my presentation on Tuesday to find out!  (Or check back on my website when I make my slideshow, and possibly the video of the presentation, available).

Related articles:

The Stimulus: FedBizOpps has Green

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.
 
This week, I continue to prepare for my "Green in the Stimulus" presentation and so I will provide you with some nuggets I have learned from my research.
 
Last time, we talked about a ridiculous listing of "LEEDS" projects prepared by the U.S. Conference of Mayors.  Today I am going to briefly talk about an extremely helpful website, FedBizOpps.Gov.  If you are looking for federal business opportunities, this is the place to start. 
 
During my test run, I did a quick search for projects containing the keyword "LEED."  
 
 
The search came up with 311 federal projects containing the word LEED!  Notice the opportunity at the bottom from the General Services Adminstration

"The General Services Administration (GSA), Region 7, is seeking a contractor to perform as the CMc (Construction Manager as Contractor) for the construction of the New United States Land Port of Entry (LPOE) in Tornillo, Texas. The site is located in El Paso County, Texas. It is situated approximately 30 miles east of El Paso and is adjacent to the current Fabens Port of Entry facility, which will be demolished as part of the construction option in this contract.  An estimated 115 acres will compose the new LPOE.

This project must be certified through the U.S. Green Building Council (USGBC) Leadership in Energy and Environmental Design (LEED®) green building rating system. The target USGBC LEED® rating for this project is Silver level."
There are going to be a lot more opportunities posted by the GSA resulting from the stimulus money.  Are you monitoring FedBizOpps?  Do you have someone else monitoring FedBizOpps for opportunities for your company?  If the answer to both questions is no, you better figure out a plan. 
 
And how are you going to address this in your contract?:  "This project must be certified. . . ."
 
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The Stimulus: "LEEDS"ing the Way?

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.

Yesterday, while preparing for my "Green in the Stimulus" talk, I came across something both hilarious and frightening. 

StimulusWatch.org has provided an inventory of proposed projects that could benefit from the stimulus.  The list was prepared from a list of shovel-ready projects prepared by the U.S. Conference of Mayors .  While reviewing the list for "LEED" projects, to my great horror, I made the following discovery:



If an entity is seeking "LEEDS" certification, is the project really "shovel-ready"?  And no, that is not a rhetorical question. 

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"The Stimulus: Now for the hard part"

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.
 
On February 17, CNN ran the above headline after President Obama signed the stimulus bill.  To me, a more perfect headline could not have been written. 
 
Ever since I read about the stimulus bill, one particular nuance has interested me:  the package does not include earmarks.  Due to the lack of earmarks, the hardest part of the stimulus bill may be administering the $787 billion in funds. 

The lack of earmarks has important implications for state and federal energy programs throughout the country.  Without earmarks, state energy offices will have wide-ranging discretion in doling out large sums of money not previously seen: 

The biggest test of the administration’s energy goals may come in spending the billions that have been devoted to states and cities for improving energy efficiency.  To get the money out quickly, the plans sends it through a range of programs that are not accustomed to seeing funding on this scale.  State energy offices that annually receive less than $100 million combined from Washington are slated to receive $3.4 billion.  
 
 

A recent NPR story, "Earmark-Free Stimulus Bill Lacks Spending Direction", focused on the potential problems that may arise when the money is sent to the states:   

 
When this bill passes, a Niagara Falls of money will flow out of Washington and into the accounts of state highway commissioners, governors and legislatures, local school boards, county executives -- even mayors, [the Brookings Institution's Sarah] Binder says.

"It raises a whole host of questions about how efficiently money can be spent, how effectively it will be spent, how quickly money can be spent, just because there's no set process here for determining how money will get out the door to create jobs or, as the president said, to save jobs," she says.
 

In one particular instance, a South Carolina official who runs the state’s energy efficiency programs, will be tasked with managing large sums of money and finding proper projects and programs for the money:
 
 
In South Carolina, the state energy office is so small that its director, John Clark, answers the phone.  He said his office, which receives $.15 million per year, has put out an urgent call to state offices and school districts for energy-saving projects to receive.  He will also have to advise the state’s cities and counties, which have even less experience in big energy efficiency projects and are slated to get $35 million of their own from a separate $3.5 billion block-grant program in the package.”  
 
 
While Republicans, Democrats and the President argued over the stimulus package for weeks, the real battle may arise when state agencies and officials attempt to divide up the stimulus funding and choose the projects that receive funding.  How are you planning to seize the opportunities that arise from the stimulus? 
 
I will be speaking on this and other topics surrounding the stimulus package on March 3 and you are invited to join me.  Additionally, I am putting together a "Green in the Stimulus" program that may be of interest to many readers.  Stay tuned as we continue to discuss implications for the green building industry in the stimulus package.
 
Related Links: 

The Stimulus: Green Building Provisions

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.
 
Love it or hate it, the stimulus package was signed into law yesterday.  In the coming months and years, $787 billion is going to be used to support new projects, developments and tax cuts throughout the country.  Set aside your exhilaration, worry, excitement or anger over the stimulus package.  You should be thinking about one thing now: 
 
How are you going to take advantage of the opportunities presented through the stimulus package
 
On March 3, I will be speaking on this very issue in Arlington, Virginia.  My friends at Rutherford were kind enough to include me in their symposium:  "Trends In Green Building - Effective Strategies for Existing Buildings and the Federal Stimulus Package."  Other speakers and their topics include:
Thomas C. Mawson - U.S. Green Building Council
Executive Director, National Capital Region Chapter
2009 LEED Rating System Changes and their Impact on Property Owners and Developers

Richard M. Silberman - Healthy Buildings International, Inc.
Chief Executive Officer
Earning the Ventilation-Related Credits Within LEED-NC

Eric M. Oliver - EMO Energy Solutions
President
Looking for Energy Savings In All The Right Places

Bobby C. Christian - Tangible Software Solutions, Inc.
President  
Simplifying Energy – Buy. Use. Manage.
I am very excited to hear the other speakers talk about energy efficiency in both new construction and retrofits.  This is a very timely panel and one you should not miss.  If you would like to attend, please RSVP to me (chris@greenbuildinglawupdate.com) or Nancy Shipley (703-813-6575 or nancy.shipley@rutherfoord.com). 
 
Over the next few weeks, I am going to focus on the stimulus package and hope to develop my presentation before your very eyes here at Green Building Law Update. 
 
Let's start with the basics today.  The following is a list of funding for green building projects included in the stimulus package, according to the Associated Press:
  • About $50 billion for energy programs, focused chiefly on efficiency and renewable energy, including $5 billion to weatherize modest-income homes; $6.4 billion to clean up nuclear weapons production sites; $11 billion toward a so-called "smart electricity grid" to reduce waste; $6 billion to subsidize loans for renewable energy projects; $6.3 billion in state energy efficiency and clean energy grants; and $4.5 billion make federal buildings more energy efficient; $2 billion in grants for advanced batteries for electric vehicles.
  • $4 billion to repair and make more energy efficient public housing projects
  • $44.5 billion in aid to local school districts to prevent layoffs and cutbacks, with flexibility to use the funds for school modernization and repair
That last entry caused me to do a double take.  Money set aside for education was previously touted as funds to modernize schools.  The final version appears to have modified the language to allow the funds to be used for teachers and administrators. 
 

Did I forget anything? 

Related Links:

GLBU Prediction 2009: It's All About the Retrofit

"Green" was the buzz word in 2008.  In 2009, Green Building Law Update predicts that green buzz words will become more nuanced and the focus will be on "energy efficiency," "retrofits," and "existing buildings." 

I don't mind making this prediction because it is not much of a stretch.  There are three factors that will contribute to the popularity of retrofitting existing buildings to improve energy efficiency. 

First, as we have been discussing all week, President-Elect Obama is pushing a large stimulus package aimed at, in part, improving the energy efficiency of existing buildings and homes.  Yesterday, President-Elect Obama again stated his plan "to modernize 75 percent of federal buildings and improve energy efficiency in 2 million homes to save consumers billions of dollars on energy bills."

The second factor that will contribute to increased popularity for retrofitting current building stock is a slowdown in new building project developments.  At this point, we have all heard the dire warnings of a construction slowdown.  This construction slowdown is due, in part, to tightened lending options.  We also know that tenants are now demanding green buildings.  The result will be that building owners will look to "retrofit" their existing buildings so as to offer more green building options. 

Finally, climate legislation in the form of cap-and-trade is coming.  Early investments now to reduce energy use through retrofits will pay off for big businesses. 

What do you think?  Are my predictions off?  What is your one prediction for the green building industry in 2009?   

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A Very Detailed Green Stimulus Proposal

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.

On Monday, we highlighted some green building strategies that might be incorporated in the Obama Administration's proposed stimulus program.  The Alliance to Save Energy, Edison Electric Institute, Energy Future Coalition and the Natural Resources Defense Council (NRDC) recently published a comprehensive Energy Efficiency Initiative to be included in the proposed stimulus plan.  You should read the letter yourself but here is a good summary from NRDC's Peter Lehner:

The proposal we put together would invest approximately $33 billion for greater energy efficiency. . . . One of our primary recommendations is to make grants available to states and local governments giving them a huge incentive to increase efficiency. Under this program, states would provide funding under the grants program to entities such as utilities, cooperatives, energy service companies and school districts.

The grants would fall into the following broad categories: home energy efficiency retrofits, retrofits of public buildings, commercial building efficiency retrofits and efficiency programs matching fund. 

The Initiative's plan to allocate the state grants is particularly intriguing.  The first half of the funding would be allocated without conditions.  The second half of the funding would be tied to, in part, a state adopting and implementing more stringent energy building codes: 2009 IECC (for residential buildings) and the ASHRAE Standard 90.1-2007 (for commercial buildings).

If the stimulus package includes any or all of these proposals, the impacts on the green building and construction industry would be enormous.  In a few short years, we would simultaneously see huge government investments in green building strategies to improve energy efficiency while states simultaneously adopt building codes that will force private projects to include new green building techniques and technologies. 

If you are in the construction or green building industry, you better pay attention to the details of the final stimulus package. 

Related Links: 

Photo:  Kimberlyfaye

Big Business Support Green Stimulus Package

Update:  For a rundown of green building provisions in the stimulus pacakge, see this post.

Over the weekend, news broke that the massive economic stimulus package will not be ready for President-Elect Barack Obama to sign on day one. As you may recall, President-Elect Obama had previously indicated that the stimulus package would include support for green building strategies.

While it was not previously clear what green building strategies were to be included, a December 24, 2008 letter from the United States Climate Action Partnership (USCAP), a business-environmental coalition arguing for mandatory global warming legislation, detailed what it believed should be included as part of the package:

It is possible to move fast and make investments in energy efficiency that can immediately put people to work on transit projects and existing building retrofits. These include weatherization, insulation, HVAC upgrades, and use of waste heat in industrial processes and facilities.

Rural and urban homes and businesses alike can take advantage of renewable technologies such as solar photovoltaic systems, hot water heaters or small wind turbines, and communities can benefit from development of local renewable energy resources.

This letter was signed by CEOs of some of the biggest corporations in the energy industry:

Alcoa
The Dow Chemical Company
Duke Energy
DuPont
General Electric
NRG Energy, Inc.
PG&E Corporation
PNM Resources
Siemens Corporation

With much of the energy industry and the President-Elect supporting a stimulus package that invests in energy efficiency strategies, we are likely to see an influx of capital for green building projects.

How is your business preparing for these new construction opportunities? 

Related Links: 

The Political Winds Are Changing: Part II

On Wednesday, we highlighted the Bush Administration's recent decision to order the Office of Management and Budget (OMB) to not adopt regulations that would have improved energy efficiency in all federal buildings.  This decision is in stark contrast to the political platform and green building policies being pushed by President-Elect Obama. 

If you may recall, back in 2008, Green Building Law Update highlighted the green building political platforms of both President-Elect Obama and Senator John McCain.  Among the green building proposals, both Obama and McCain supported "greening" the federal government by applying a higher efficiency standard to government buildings.  While we can not be certain what an Obama Administration would have done, the Bush Administration's decision to kill the federal building energy efficiency regulation contrasts sharply with Obama's platform. 

Even more telling, Obama has emphasized green building policies as part of a massive federal stimulus package that is likely to be voted on as soon as Congress returns in January: 

Roughly $350 billion would be invested to rebuild roads and bridges, modernize schools and help hospitals and doctors switch to computerized patient records. That category also would include projects aimed at improving energy efficiency, such as weatherizing buildings, as well as aid to the poor through expanded unemployment and food-stamp benefits.

As one of his first acts, President-Elect Obama plans to use $350 billion to, in part, improve energy efficiency in buildings and modernize schools.  Improved energy efficiency in buildings and modernizing schools will likely require green building strategies.  The political winds have most definitely shifted in favor of green building policies. 

If you are looking for green building projects, make sure you pay attention to the upcoming federal stimulus package.  We will continue to keep you appraised here at Green Building Law Update.