The 2009 Stimulus Act: Promise And Pitfalls for the Washington D.C. Area's Green Building Efforts
By John James McKenna, Esq.i
Learn how writer John James McKenna, partner, Asmar, Schor & McKenna, PLLC, forecasted ARRA’s possible results when the Act was initiated.
READ MORE >
The 2009 Stimulus Act: Promise And Pitfalls for the Washington D.C. Area's Green Building Efforts
By John James McKenna, Esq.i
 |
| John James McKenna, Esq. |
The primary goal of the American Recovery and Reinvestment Act of 2009 (ARRA) is to stimulate a freefalling American economy by infusing $787 billion in funds and tax incentives into it over the next few years.
A secondary purpose is to promote key long-term congressional and executive branch objectives by allocating these staggering sums towards initiatives that advance those objectives.
Encouraging the codification and spread of well-founded green building standards and practices at federal, state and local levels, as a subset of the Obama administration’s stated commitment to energy and environmental reform, is most certainly one such goal.
|
For the Washington Metropolitan area, ARRA will undoubtedly spur significant green activity, and has the potential to accelerate the growth pace of already proliferating state and local environmental legislation.
ARRA, though, also puts an express premium on “commencing activities and expenditures as quickly as possible.”ii This emphasis, coupled with the rather desperate present state of the construction industry, carries with it the uncomfortable specter of an onslaught of underemployed workers installing building systems they do not fully understand under rushed conditions.
Thus ARRA holds both real promise and potential risk for the tri-state region’s burgeoning green movement, as it does for the rest of the country.
|
By some estimates, ARRA targets approximately $110 billion dollars for energy and environmental initiatives.
iii It appropriates these funds to various federal agencies and departments, which are mandated to use them for federal, state and local programs and projects on a range of green initiatives, including building modernization, clean water, renewable energy and electricity grid upgrades.
For example, ARRA makes $4.5 billion available to the General Services Administration (GSA) to convert GSA facilities into “High-Performance Green Buildings.” Over twenty percent of the funds allocated for the forty-three buildings the GSA has identified for this program, as of March 31, 2009, are intended for buildings in the District of Columbia.
ARRA also invests some $4 billion dollars in the Environmental Protection Agency’s Clean Water State Revolving Fund, primarily for use in assisting building and upgrading wastewater treatment plants and similar projects to restore clean water.
Approximately $879 million of that total is intended for six watershed states of Cheasapeake Bay, whose health is of great regional concern, and for the District of Columbia. Additionally, over $500 million in ARRA funds are slotted for allocation to the District of Columbia, Maryland, Virginia and their local jurisdictions for various green or green related initiatives such as improving energy efficiency in aging public housing developments and in local government buildings.iv
Accordingly, a rapid flow of green money is heading the Washington Metropolitan Area’s way, as it is in other parts of the country. Whether these ARRA funds ultimately reap regional results more tangible than short-lived bursts of green activity will depend at least in part on the extent they operate to grow and improve the area’s present infrastructure.
ARRA encourages such growth by conditioning substantial portions of its funding on securing written commitments from the individual states to energy reform. For example, it offers an aggregate total of $3.1 billion in energy grants, given through the Department of Energy, to states that provide written assurances to the Energy Secretary that they will strengthen their building codes, enforcement mechanisms and measurement protocols, in cooperation with neighboring jurisdictions, with respect to the relative energy efficiency of their commercial and residential buildings.
The good news for the region is that the tri-state area is already trending in the direction ARRA wants it and the rest of the country to go. This is due in no small measure to the committed efforts of such pioneering local leaders as the Intergovernmental Green Building Group (IGBC), a technical support committee (on matters of sustainability) for the Metropolitan Washington Council of Governments (COG).
Over the past few years, at least fifteen jurisdictions within the region have enacted or begun green building programs or legislation. U.S. Green Building Council’s (USGBC) LEED® Silver certification is clearly emerging as the minimum standard for energy efficiency and conservation practices, at least with respect to government and commercial buildings in the region.
The reliance on LEED Silver by individual jurisdictions brings a welcomed uniformity to the green code that can only assist the construction industry in acclimating to this new climate. Additionally, LEED Silver requires commissioning of new construction, which has the potential of reducing potential construction litigation by catching non-conforming issues before completion of the contract.
| The promulgation of homogenous residential standards, however, is less developed, and well conceived programs such as the National Association of Home Builders’ (NAHB) Model Green Home Building Guidelines and USGBC’s LEED for Homes Green Building Rating System compete in this arena for greater public support. |
Governors O’Malley of Maryland and Kaine of Virginia, and Mayor Fenty of the District of Columbia, have each provided Energy Secretary Henry Chu with the requisite assurances for their jurisdictions’ share of additional energy grants. Accordingly, conditions are ripe for the region to maximize the potential long-term benefits ARRA wants to achieve for the green movement.
| However, ARRA’s primary objective of jumpstarting the economy puts a premium on the speed with which funds must be used, including those for green construction projects. For the still relatively nascent green building movement, this should be a matter of caution and concern.
The construction industry is replete with past examples of sudden building opportunities that ultimately led to building performance failures. These were often caused by a rush of under-qualified contractors chasing after work, a phenomenon green construction may soon know well.
|
Moreover, the net benefits of green building are still a matter of some debate. Some critics sneer that the entire movement fails to add true value. Others argue that LEED criteria and similar guidelines, including municipal ordinances encouraging green roofs, energy conservation, thermal insulation and the use of innovative products can lead to moisture buildup and mold within exterior walls.v
Similarly, the thesis of a December 2007 study at Texas A&M University was that under normal and typical building conditions, high cellulose-based, rapidly renewable materials, of the type included within the LEED “Materials and Resources” rating category, are highly susceptible to mold growth.vi
A recent insurance market survey by Marsh indicates that casualty markets are incrementally warming to green construction, but “fear of the unknown” is still the predominant sentiment. Some see the ghosts of systems disasters past in the movement’s emphasis on untested products, materials and processes. And throughout all the markets surveyed, the recurrent perception regarding the relative risks and rewards of the “green built environment” was that “time will tell”.vii
Notwithstanding these criticisms and concerns, there is ample data indicating that when established green building designs and techniques are properly employed, the benefits in energy efficiency and long term cost savings are substantial.viii Nevertheless, if green buildings start manifesting performance failures, insurers will shy away. And they will do so even if the underlying systems themselves are sound, but failed because of a dearth of experienced and knowledgeable contractors-just ask any residential builder who used Exterior Insulation and Finish Systems in the 1990s.
| Thus it is of paramount concern for the green movement, both in the tri-state area and elsewhere, that ARRA’s emphasis on spending money fast does not have the unintended effect of creating poorly constructed or poorly performing buildings. |
During this critical time in the movement’s development, heightened attention should be given to ensuring ARRA funds intended for green building practices are directed to thorough worker training and rigorous building commissioning. If such steps are taken, the likelihood that ARRA leaves behind a legacy of truly high performance buildings with little legal backlash increases dramatically.
This, along with the prospect of furthering smart, cohesive green legislation, is the true promise ARRA brings to the Washington Metropolitan area’s green building community, and to the green movement at large.
