Green Building Law Blog : Green Building Lawyer & Attorney : Shari Shapiro: Calliope Communications, LLC

A long time ago in a first term far away, there was the American Recovery and Reinvestment Act (ARRA), a.k.a the Stimulus. 

As explained by the DOE, The ARRA section on State Energy Program funding included a statutory provision (Section 410) linking SEP funding to building energy code adoption and enforcement. As a condition of accepting the ARRA funding, the states provided assurances through governor’s letters indicating their state would comply with the terms of Section 410.

All 50 states took ARRA SEP money, and all 50 governors provided commitment letters commiting to do three things relating to building energy codes:

Adopt a building energy code for residential buildings that meets or exceeds the 2009 International Energy Conservation Code (IECC),

Adopt a building energy code for commercial buildings and high rise residential that meets or exceeds the ANSI/ASHRAE/IESNA Standard 90.1-2007, and;

 Develop and implement a plan, including active training and enforcement provisions, to achieve 90% compliance with the target codes by 2017, including measuring current compliance each year. 

In the four years since ARRA, eighteen states still have no energy code at all or have residential codes that do meet the ARRA requirements, and fifteen states still have no energy code at all or have commercial codes that do not meet the ARRA requirements. A map of the status of every state's energy codes is available here.

 

I have not been able to find state annual compliance reports or a report by the DOE Office of the Inspector General on the building code commitment aspect of the ARRA funding.   So, there is little, if any, data on when or whether states will comply with their ARRA commitments. [NOTE: I would welcome being proven wrong in this area.  If you have data, please send me a link and put it in the comment section].

 

Given the vast research that building energy codes are an inexpensive way to acheive energy efficiency, it was a really good idea to tie the ARRA finding to energy code adoption.  Unfortunately, lack of enforcement of ARRA commitments appears to be a missed opportunity to move the country forward in this area.

• Email This
• Print
• Trackbacks
• Share Link

I covered the messy breakdown of the Carousel/Destiny USA project in Syracuse on Monday.  In short, the Destiny USA project was selected as a green "demonstration" project under the 2004 Green Bonds program.  $255 million in tax exempt bonds were issued on behalf of the project, the revenue of which was supposed to be used to implement the green features of the project.  As of now, none of the green features have been implemented, and the developer has intimated that even if the project is fully built out, the green features will not be included.  The IRS will have to decide whether to rescind the tax exempt status of the bonds for failing to meet the green requirements.

I have written at length about creating effective green incentives and regulations (see my Regulating Green Series here).  For me, the most interesting part of this debacle is what it reveals about a major green incentive program.  The Green Bonds program was developed as a part of the America Jobs Creation Act of 2004.  In theory, the program was intended to: 

 finance environmentally friendly development. The objective is to reclaim contaminated industrial and commercial land (brown fields), and encourage energy conservation and the use of renewable energy sources.

Although the goals of the Green Bonds program were clearly noble, as I see it the program was doomed from the start. No market rate project in 2005 could have met all of these requirements.  Thus, the proponents of the projects had reason to overstate the green components of their projects to access $2 billion in tax free capital for the projects. 

According to the IRS Guidance (available here) $2 billion in AAA tax exempt bonds were authorized by the Federal government to be awarded to four demonstration projects.  To qualify for the bonds, the four projects in aggregate had to:

1. Reduce energy consumption by more that 150 megawatts annually compared to conventional generation;
2. Reduce daily sulfur dioxide emissions by at least 10 tons compared to coal generated power;
3. Expand by 75% the domestic solar PV market in the United States as compared to the expansion of that market from 2001-2002, which was 14.424 megawatts (which means an aggregate increase of approximately 11 megawatts, or an average of almost 4 megawatts of PV power per projects);
4. Use at least 25 megawatts of fuel cell energy generation.

In addition, each project had to be at least 1,000,000 square feet or 20 acres and: 

1. At least 75% of the square footage had to be LEED certified;
2. The wood had to be certified under the Sustainable Forestry Initiative or the American Farm Tree System;
3. Reclaim a brownfield site

Beyond the green features, the projects also had to create at least 1000 construction jobs and 1,500 full time equivalent jobs. 

In addition to the requirements of the Green Bonds, the Destiny USA project entered into a Memorandum of Understanding with the EPA (available here and summary below from Syracuse.com) committing to: 

1. Using green building design, construction and operation principles to obtain the highest levels of certification from the U.S. Green Building Council's Leadership in Energy and Environmental Design
   program;
2. Retrofitting more than 100 construction vehicles with diesel particulate filters and using clean fuel, which will reduce emissions by nearly 85 percent;
3. Implementing techniques to reduce idling of vehicles during construction
4. Becoming partners in EPA's Energy Star and WaterSense programs,
   which require the use of energy- and water-efficient appliances;
5. Using over 3,000 tons of coal ash in place of using newly-manufactured Portland Cement, which will reduce greenhouse gases by over 3,000 tons.
    

As a policy measure, the green bonds were destined to be ineffective.  For a green incentive to be truly beneficial, it needs to set out goals that stretch its recipients to higher levels of sustainability, but not so pie-in-the-sky that they create an incentive to greenwash their projects.  This is a tough balance to strike.  Doing so requires that the regulatory bodies have a good understanding of the state of the green market that they are looking to incentivize. It is not enough to throw public money at any project claiming to be green.  The result is projects like Destiny USA, which give a bad name to green building and public financing of green projects. 

By contrast, good investment in green projects can bring real benefits.  I analyzed the investment of ARRA funds in green projects.  Per public dollar, these investments were among the most efficient ways of creating jobs of all of the ARRA money spent. (See my analysis here).  As Congress debates the value of continuing public investment in green projects and renewable energy, the debate must not only be about whether, but how, the support will be crafted and implemented.  The road to green is paved with good intentions. 

• Email This
• Print
• Trackbacks
• Share Link

One of my loyal readers was kind enough to bring to my attention a troubling article from the Washington Post in which a man who had earned 9 green certifications and sent out hundreds of resumes still has yet to receive a single job offer.

In September, I spoke at a Woodrow Wilson Center event on green jobs for women.  Most of the presenters were from non-profit organizations which trained women for green construction jobs.  They all reported that their graduates were having trouble finding work.

The subject of the Washington Post article had been laid off from his job as a surveyor:

Anton has been out of work since 2008, when his job as a surveyor vanished with Florida's once-sizzling housing market.

He then retrained to do solar installation, green demolition, etc. and still could not find a job. 

The Washington Post article waves a wagging finger at the green stimulus spending and the promise of green jobs:

The Obama administration channeled more than $90 billion from the $814 billion economic stimulus bill into clean energy technology, confident that the investment would grow into the economy's next big thing.

The underlying assumptions of the Washington Post article, and many others like it, are inherently flawed.  You cannot wring blood from a stone. The recovery is happening slowly.  Lending is still very tight, meaning that it is difficult to get building projects--green or otherwise--financed. In other words, it's the economy, stupid.

The problem for Mr. Anton is not that he retrained green.  Indeed, his odds of finding a job actually went up through his retraining.  According to the Pew Charitable trust:

[B]etween 1998 and 2007, clean energy economy jobs—a mix of white- and blue-collar positions, from scientists and engineers to electricians, machinists and teachers—grew by 9.1 percent, while total jobs grew by only 3.7 percent. And although we expect job growth in the clean energy economy to have declined in 2008, experts predict the drop in this sector will be less severe than the drop in U.S. jobs overall.

Mr. Anton, and millions of others like him, are out of work not because the promise of a green economy failed, but because the economy failed.

Articles like the Washington Post piece also claim that the promise of the green economy as a job engine has been over-hyped.  This is not because the idea that green technology and renewable energy is not a potential new source of job growth--just look at China.  Even our own stimulus plan demonstrates that green stimulus projects create the most jobs per dollar of any of the stimulus initiatives. 

Rather, since Obama came into office and pushed a "green" stimulus plan, the public policy initiatives that underpin a successful green economy (not to mention a healthier environment)--like control of carbon through cap or tax, a national renewable energy portfolio, etc.--have been jettisoned.  With no new real economic engine or dynamism, the overall economy is recovering slowly. Yet, despite these obstacles, green job creation is still outpacing other sectors. 

So, perhaps the Washington Post article should have asked a different question: If green is not the next big thing, what did the other $724 billion buy you? 

• Email This
• Print
• Trackbacks
• Share Link

 The General Services Administration is one of the largest owners of real estate in the country, composed primarily of office buildings and courthouses, land ports of entry, and warehouses.  The GSA owns and leases more than 354 million square feet of space in 8,600 buildings across the nation.

The GSA is also the owner of one of the greenest real estate porfolios.  As of the summer of 2010, the GSA had 48 LEED-certified owned and leased buildings with approximately 150 more working towards accreditation. Eighteen of those projects exceeded the minimum with LEED Gold certifications, and one GSA lease, the FBI Regional Office in Chicago, achieved a Platinum LEED rating for Existing Buildings.  The GSA has required LEED Silver certification for its projects for some time, and now requires that new Federal buildings achieve LEED Gold certification.

While I was at GreenBuild in Chicago, I had the chance to sit down with Kevin Kampschroer, GSA's Director of the Office of Federal High-Performance Green Buildings and Eleni Reed, GSA's Chief Greening Officer.

We talked about GSA's experience greening the Federal government's real estate portfolio, implementing the GSA's LEED Gold requirement and the challenge--and benefits--of trying to do four times as many contracts as the GSA normally does because of the influx of $5 billion in Stimulus funding. 

Here is what they said:

GBLB: What has the GSA done with the Stimulus money? 

KK: The GSA has a bit of a different position than other agencies because the GSA actually enters into the contracts with builders and other receipients, as opposed to granting funds to states and other entities that ultimately contract with the recipients.  As of the end of September we had awarded $5 billion [for greening the Federal real estate and fleet].  After the award, it takes some time for the contractor to get the contract and hire the people and do the work, but we have made $1 billion in payments so far.

GBLB: What was impact of the Stimulus money on the GSA?

KK:  As a result of the Stimulus, we awarded four times as many contracts as the GSA usually does in the same period of time.  This forced us to find ways to be more efficient in what we were doing.  For example, we started "speed dating."  Where decisions had to be made, we put all the decision makers in a room togther to come to a decision quickly.  Executives and managers had to delegate some of the decision-making to ensure efficiency. 

Because the projects had to be "shovel ready," many of the designs were already done.  The designs met our specifications, but were not necessarily the best possible designs--the most you can do with the budget that you have.  Going forward, we are retooling our performance criteria and specifications to spur teams to be more innovative and creative with the budget they have.

For example, the National Renewable Energy Laboratory is a net-zero building.  We gave the team specifications, and we incentivized the team by paying them mroe the closer they got to the goals.

For other projects, we had a relatively brief minimum performance criteria which was a goal statement for the project.  It has resulted in more rapid and more innovative designs. However, this requires accepting a shift in risk to the Government side.  But the less risk you take, the less you get [in terms of innovation and design.]

This also has implications for allocating capital.  The GSA has to allow for approximation up front and not require everything to be fixed from the beginning of the project.  

GBLB:  Now that you have all these green buildings, what are you going to do next?  

ER: We are looking to get good metrics about whether we are doing what we set out to do [in terms of building performance].  We have 250 buildings with baseline metrics across a wide variety of project types so we should be able to get some good data. 

GBLB: How will the experience with the Stimulus funds impact the agency going forward? 

KK: We will be more efficient and more effective.  We will have achieved significant improvement in our portfolio [of buildings].  The budget will be extremely lean in the future.  It will be important to apply the lessons we have learned [about how to do projects more efficiently] to operating and maintaining the buildings to prevent deterioration.  We have an opportunity in tracking the performance of the inventory over time and across the portfolio.

GBLB: What about your requirement that GSA projects achieve LEED Gold certification?

KK: We select contractors who know that this is the expectation.  We have been doing LEED Silver for a decade, this is raising the bar to LEED GOld, but the architect and engineering firms know how to do it. 

When we budget the project, we have adjusted the process to allow for LEED Gold certification.  We have done studies on standard versus green construction, you can do LEED Silver for less than conventional construction because of integrated design. 

GBLB: Have you ever had a project fail to get the mandated certification? 

KK: The way we started out was that our goal was LEED Silver.  We have had building that did not reach that level of certification, but never had one that failed to acheive minimum LEED certification.

For more on the GSA's efforts, Architecture Week had an article by Kevin, and Kevin's testimony before the House Subcommittee on the GSA's Stimulus efforts is available here.

• Email This
• Print
• Trackbacks
• Share Link

I have been tracking the green stimulus spending since June 2009. In November 2009, actual dollars spent on green projects was $1.5 billion.  Now, in November 2010, dollars actually paid to date on green projects is approximately $11 billion.  It amounts to approximately 7% of contract spending from the Stimulus bill (which does not include tax benefits), and 2.6% of the total stimulus money paid to date. 

By agency, the spending on green breaks out as follows:

	Allocated	Paid Out	Unit	% Paid
DOE	33.29	9.4	Billion	28.24%
Energy Efficiency/Renewable Energy	16.50	4	Billion	26.06%
EPA (9/30)	7.20	4	Billion	62.22%
GSA	6.10	1.42	Billion	23.28%
Green Buildings	5.50	1	Billion	18.18%
DOT	40.40	22.3	Billion	55.20%
High Speed Rail	3.00	1	Billion	33.33%
Total Agency	86.99	38	Billion	43.22%
Total Green	32.20	11	Billion	33.48%
Total Contract Spending	275.00	156.7	Billion	56.98%
Total Stimulus	787.00	403.4	Billion	51.26%
% Green of Contract Spending	11.71%	6.88%
% Green of Total Stimulus	4.09%	2.67%

[I used the same methodology as described in detail here. If you are a data geek like me, you can do your own number crunching at Recovery.gov and the agency recovery sites who do weekly reporting in Excel on the allocation and spending of the Stimulus money.  There is a wealth of information available, and I welcome any input or different statistical or mathematical analyses from the Green Building Law Community.] 

At the initiation of the Stimulus, Obama touted the green components of the stimulus bill.  He has also been very positive on the prospect of green jobs. Opponents of the stimulus bill, and waning support of green initiatives and green jobs in general, has been on the rise.

So the question becomes: what is the value of the 3% of the Stimulus that went to green iniatives, and was the return on investment higher or lower than the other initiatives that were funded by the stimulus? The answer to the ROI question is "yes"-- Agencies tasked with green funding (DOE, EPA, GSA) hold 3 of the top 10 most efficient job creating agencies that were allocated stimulus funding:

 

	Stimulus Funds Paid	Jobs Created	Dollars Per Job
Department of Justice	$2,013,343,173	16330.59	$123,286.62
National Science Foundation	$817,277,981	5503.36	$148,505.27
Department of the Interior	$1,545,986,174	10047.13	$153,873.41
Department of Education	$66,652,472,918	341668.74	$195,079.22
Department of Energy	$9,691,290,357	42262.17	$229,313.60
General Services Administration	$1,493,185,840	5773.82	$258,613.16
Department of Housing and Urban Development	$7,270,460,291	27640.01	$263,041.16
Department of Homeland Security	$598,741,846	2137.91	$280,059.43
Environmental Protection Agency	$4,608,982,170	16233.68	$283,914.81

  By contrast, the two departments which spent the most money, the Department of the Treasury (tax cuts) and the Social Security Administration only created 188 direct jobs.

Department of the Treasury	$8,575,280,379	144.27	$59,439,109.86
Social Security Administration	$13,727,406,290	44.75	$306,757,682.46

It will be argued that the tax cuts, etc. indirectly created jobs by pumping more money into the economy.  But there is a direct way to measure the impact of a single green dollar.  To address this, I looked at the statistics for the GSA.  Unlike other agencies which allocate money through states to programs or disperse it to individual taxpayers, the GSA contracts directly with builders and other direct contract fund recipients to build or renovate federal buildings.

As of September 30, 2010, the GSA had saved or created 5773.82 jobs (how you have .82 of a job I can't say). The stat is here. The GSA was 16th in the agencies recieving funding, and the12th net job creating agency.  But on a job per dollar basis, the GSA the 6th most efficient job creating agency at $258,613.16 per job created.   

Do not fall into this statistical trap "$258k per job? We could have created five $50k jobs for that money!"  Remember, this dollars per job includes materials and costs of the jobs involved (bricks, mortar, etc.), which also have downstream job creating effects (brick makers, concrete haulers, etc.).

Tomorrow, I will post an interview I had at Greenbuild with Kevin Kampschroer, the Director of the Office of Federal High-Performance Green Buildings at GSA in which he gave insight not only into the GSA's experience with the Stimulus spending, but also on the long term impacts the Stimulus spending had on the operation of the GSA itself. 

• Email This
• Print
• Trackbacks
• Share Link

I am speaking today and the Woodrow Wilson Center in Washington, DC at a forum on green jobs for women.  Although policymakers assert that government investments in green initiatives can produce 20% more jobs than traditional economic stimulus measures, women are not finding as much employment in the green sector as men.  I wrote about this issue for the first time last year, my original post is here.

The issue that I am presenting on today is the low representation of women in white-collar green jobs.  When polticians talk aboout green jobs, the focus is most often on blue-collar work--workers insulating homes or installing solar panels.  There is no doubt that women are historically underrepresented in manual labor contruction work--women account for just 3% of building trade workers.  This gender disparity is no different when electricians turn from hooking up HVAC units to hooking up solar arrays. 

But what about white collar green jobs? There are no practical barriers to entry for women to become construction or energy lawyers, to finance green projects or to create businesses that develop or market innovative green products.  Gender equity is only one of the issues here--it is new efforts in these areas which will create demand for blue-collar and white-collar workers alike, and create new revenue to reinvigorate the American economy. 

And yet women are underrepesented in these areas as well.  Women make up just 16% of the leadership of the ABA Construction Law Committee, and a lower percentage of scientists, researchers, engineers and financiers.

What to do? 

• Qualify white collar green jobs for economic incentives--this will benefit the green economy as a whole.  If there are no new businesses creating demand for people to caulk houses or build solar arrays, all the green job training in the world will be wasted. This will benefit men and women alike.
• Create targeted green training (and RE-training) programs for women in law, business, engineering and finance. Alumni groups from higher education institutions could take on this effort, and make the training available not only for their alumni, but to professionals within their geographical area.
• Create set-asides in green purchasing programs for women-owned green buisnesses, particularly in government programs and large companies going green,.
• Take on the issue--USGBC and other high profile green organizations and government entities need to make women's participation in the green economy a priority.

 

• Email This
• Print
• Trackbacks
• Share Link

A study out of the Government Accountability Office (GAO) reports:

As of 31 December 2009, according to data available to the Department of Energy, about 9,100 homes had been weatherized out of a planned 593,000

The pricetag for weatherizing 9,100 homes? Over $57,000 per home. 

According to the Home Energy Saver website, sponsored in part by the Department of Energy and Environmental Protection Agency, the average cost of the top 10 home energy upgrades is just $3,960, a difference of over $46,000 per home. 

Part of me doesn't care. According to Keynesian thinking, just spending stimulus money and fast, it doesn't matter how, is key to stoking the economy.  But there is part of me which envisions the thousands of additional homes which could have been weatherized had the government been more efficient in its spending. 

• Email This
• Print
• Comments (2)
• Trackbacks
• Share Link

I will make an admission.  I took tax in law school, and, it was the academic equivalent of having my left arm sawed off without anaesthesia.  Why? Mostly because things which should have been clear seemed hopelessly obscure.  Now I deal with advising clients on incentives available for sustainable projects, and the tax code and I have had to battle to a stalemate.  At least, I battle, and the tax code just sits there impentarably.

One of the features which is particularly difficicult is the relationship between 26 USC 45, which deals with tax credits for producing renewable energy (the "production tax credit" or PTC), 26 USC 48 which deals with tax credits for investing in renewable energy equipement (the "investment tax credit" or ITC) and the Renewable Energy Grant created by the ARRA.  All three of these relate to businesses which have installed renewable energy technologies, like solar, wind and geothermal.  It should be clear and easy to understand which ones apply to your business and what the incentive will be.  As with all things related to the tax code, however, it is not.

I am going to attempt to clear up some of the obscurity, but, as with all information on this blog, it is for informational purposes only, not legal advice; and you should consult your legal and financial advisor to provide you with proper advice for your business.

FEDERAL RENEWABLE ENERGY INCENTIVE CHART

Title	Applies to	Amount of Incentive
Production Tax Credit	Wind Biomass Geothermal Solar Small Irrigation Municipal solid waste Hydropower Marine and Hydrokinetic	1.5 cents per kW of power generated at a qualified facility for the 10 years beginning on the date the facility was placed in service AND sold to an unrelated person during the taxable year
Investment Tax Credit	Solar for heating, cooling, hot water, illumination or solar process heat Fuel cell Microturbine Geothermal Combined heat and power (cogeneration) Small wind Ground water thermal	30% of the cost of the "energy property" for solar and small wind, 10% for geothermal and other renewable sources
Renewable Energy Grant	Applicable property under Section 45 or 48	10% or 30% of the basis of the property, depending on the type of property placed in service during 2009 or 2010 or after 2010 if construction began on the property during 2009 or 2010 and the property is placed in service by a certain date known as the credit termination date

The incentives are mutually exclusive--The PTC and the ITC cannot both be taken, and they can be swapped for the REG, but you cannot take the PTC/ITC and the REG.

In plain english, it appears that the PTC is designed for renewable energy sources where the power is designed to be sold to others as a Renewable Energy Credit, and the ITC is designed for renewable energy sources where the power is used on-site.  The Renewable Energy Grant allows companies which have invested in either type of renewable energy capacity to receive cash, as opposed to a tax credit, which is helpful particularly if the company has no tax liability or a tax loss. 

 There are some resources available to help you sort through this morass.  The DSIRE database has quick summaries of available state and federal incentives.  The Utah Clean Energy site has a nice summary of the renewable energy features of the ARRA.   The DOE site has a useful summary of renewable energy incentives for businesses as well.

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link

Many of my readers have requested a clip of Green Building Law Blog's appearance on MSNBC discussing the amount of stimulus funding going to green projects.  The link is below:

http://www.msnbc.msn.com/id/21134540/vp/34016904#34016904

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link

In July, I wrote an analysis of the “green” spending in the American Reinvestment and Recovery Act—ARRA, also known as the “stimulus bill.” I concluded that as of July the spending on green programs accounted for only .28% of the total allocation for those programs in the ARRA-- $33.2 million had been paid out for green stimulus programs, and an additional $307 million in public transit dollars.

So…where are we four months later? More money has been paid out--about $1.5 billion--but it pales in comparison to the $83.8 billion  paid out in tax benefits as of 11/06/09, and spending on non-green projects.

Here are the stats in detail:

Energy Efficiency/Renewable Energy--Department of Energy

As of 7/17/09 the Department of Energy had paid out $264,457,144. $16,796,000 had been awarded for energy efficiency and renewable energy projects, of which $3,189,150 had actually been awarded. BOTTOM LINE IN JULY: $3 million

As of 11/06/09, the Department of Energy had paid out $1,346,197,498. $16,796,000 had been awarded for energy efficiency and renewable energy, of which $10,651,341,856 had actually been awarded, and $347,779,891 paid out. BOTTOM LINE IN NOVEMBER: $347.8 million.

Increase from July: $344.8 million.

High Performance Green Buildings--General Services Administration

As of 7/17/09 overall the GSA has paid out $12,743,040. of available $656,418,268 of which $6,807,468 has been paid out for federal buildings, which includes high performance building projects. According to the GSA, $4,500,000,000 was appropriated by Congress, $318,750,279 obligated to date (contracts awarded) and $230,771 outlayed to date (work completed & paid).
 

As of 10/06/09 overall the GSA has paid out $333,444,141, of which $67,324,333 been paid out for federal buildings, which includes high performance building projects.

Public Transit--Department of Transportation

As of 7/17/09 the DOT has paid out $773,662,175 of a total available $22,188,399,591. For rail and other transit funding, including Amtrak, obligations of $3,921,784,326.72, outlay of $306,918,718.00 (this includes state block grants).  BOTTOM LINE IN JULY: $307 million in public transit funding outlaid as of 7/17/09.

As of 10/30/09 the DOT has paid out $5,551,384,466 out of a total available $30,514,836,708. For rail and other transit funding, including Amtrak, obligations of $7,539,142,781.45, outlay of $824,343,952.21 (this includes state block grants).  BOTTOM LINE IN NOVEMBER: $824 million in public transit funding outlaid as of 10/30/09.

Increase from July: $517 million.

Everything the EPA Is Doing--Environmental Protection Agency

As of 7/17/09, EPA has paid out $30,515,805 of the $5,713,481,497 it was allocated. Assuming that all that the EPA does is in some way green related, and this is a big assumption on my part, as much of the EPA funds have been dedicates to water resources and cleanup of hazardous sites, that adds another $30 million. BOTTOM LINE IN JULY:  $30 Million

As of 11/06/09, EPA has paid out $365,636,685. Assuming that all that the EPA does is in some way green related, and this is a big assumption on my part, as much of the EPA funds have been dedicates to water resources and cleanup of hazardous sites, that adds another $366 million. BOTTOM LINE IN NOVEMBER:  $366 Million

Increase from July: $336 million.

So?

The overall spending—i.e. money that has been paid out for green projects—in the first 10 months of 2009 amounts to over $1.5 billion. This is not nothing, and a vast improvement from the summer. On the other hand, $83.8 billion has been paid out in tax benefits as of 11/06/09, and allocation on highway infrastructure by the Department of Transportation alone was $20.2 billion of which $3.7 billion has been paid out. 
 

**A word about methodology--all of the above statistics were gleaned from Recovery.gov , the Recovery websites of the individual agencies, and my personal agency contacts.  For the DOT recovery site, go here.  For the GSA recovery site, go here.  For the DOE recovery site, go here. For the EPA recovery  site, go here.  There is a wealth of information available, and I welcome any input or different statistical or mathematical analyses from the Green Building Law Community.**

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link

I know, I said I was going on maternity leave, but before I do so, I will appear on MSNBC tomorrow, November 17, 2009 at 2:30 E.S.T. to discuss green spending through the American Reinvestment and Recovery Act, also known as the stimulus bill.  My original post on this topic is available here. 

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link

I have been watching with interest the voracious appetite for the $4500 "cash for clunkers" incentive program which rewards people for trading in less fuel efficient vehicles for new, more fuel efficient ones.  So many people have taken advantage of the program that it ran out of cash within a week of opening, though the $1 billion appropriation was expected to last until November.  Now the Senate is debating whether to pour an additional $2 billion into the program.

Very interesting, but what does this have to do with green buildings, you may ask.  I see it as a very interesting object lesson for structuring green building incentives.  Green building incentives have been very popular, and are often promoted in lieu of mandatory green building regulations.  What is hard, though, is getting the incentives right.  How much is enough to stimulate green building, while maintaining a responsible public fisc?

Las Vegas famously went very wrong with their original green building incentive program, so much so that it threatened to deplete the finances of the state of Nevada.  Essentially, the problem was the same in Las Vegas as it was for the clunkers--too much money was available from the outset with too few requirements, meaning that the program was oversubscribed.  Instead, a step-wise program would have been more reasonable for both LV and the clunkers. 

So, for Clunkers, if the program had started with a $1000 incentive, and been evaluated after 1-2 months, the incentive could have been enhanced.  Now, reducing the incentive will only garner public outrage instead of benefit. 

The lesson for government entities looking to implement incentive programs? Start out with the lowest reasonable incentive, then evaluate the program after a reasonable period to see if it has been successful.  If not, you can create higher incentives or relax the requirements.  

 

• Email This
• Print
• Comments (4)
• Trackbacks
• Share Link

Yesterday I was asked whether enough support was being given to develop the green building industry in the United States.  It led me to wonder where the so-called "green" stimulus package had wound up six months later.  I had criticized the stimulus bill for being less green in reality than in rhetoric here.  The answer to where we are now that the bill is being implemented? A light shade of chartreuse, not the deep forest I would have preferred.  By my calculations, a total of $33.2 million has been paid out for green stimulus programs, and an additional $307 million in public transit dollars, of the allocated $119 BILLION.  That is .28% of the total allocation by my calculations. 

Here are the stats in detail:

 The allocations in the Stimulus Bill for categories which include green:

• Infrastructure funding has been allocated $111 billion (this includes transit)
• Energy has been allocated $8 billion. 

[Please compare this to the $288 billion for tax relief].

Energy Efficiency/Renewable Energy--Department of Energy

As of 7/17/09 the Department of Energy has paid out $264,457,144.  $16,796,000 has been awared for energy efficiency and renewable energy projects, of which  $3,189,150 has actually been awarded.  BOTTOM LINE: $3 million

High Performance Green Buildings--General Services Administration

As of 7/17/09 overall the GSA has paid out $12,743,040. of available $656,418,268 of which $6,807,468 has been paid out for federal buildings, which includes high performance building projects.

UPDATE: The GSA provided me with specific information on the High Performance Building Program.  According to the GSA, $4,500,000,000 was appropriated by Congress, $318,750,279 obligated to date (contracts awarded) and $230,771 outlayed to date (work completed & paid)

BOTTOM LINE: $230,771

Public Transit--Department of Transportation

As of 7/17/09 the DOT has paid out $773,662,175 of a total available $22,188,399,591. For rail and other transit funding, including Amtrak, obligations of $3,921,784,326.72, outlay of $306,918,718.00 (this includes state block grants).
BOTTOM LINE: $307 million in public transit funding outlaid as of 7/17/09.  

 Everything the EPA Is Doing--Environmental Protection Agency

As of 7/17/09, EPA has paid out $30,515,805 of the $5,713,481,497 it was allocated.  Assuming that all that the EPA does is in some way green related, and this is a big assumption on my part, as much of the EPA funds have been dedicates to water resources and cleanup of hazardous sites, that adds another Bottom Line $30 million. 

So what do all these numbers mean? 

I think, as I did when the ultimate stimulus bill was passed that the overall amount is not enough.  What we know now is that the money is being spent slower than anticipated.  If the concept was to stimulate the economy in 2009, $33.2m probably is insufficient.  The entire practice of architecture is dying on the vine, without help there will be few innovators left to help green the next building wave.  Something needs to be done to facilitate getting the green stimulus dollars to those projects that need them--I have heard of LEED projects which are dying because they cannot access private funds--sooner rather than later.

• Email This
• Print
• Comments (1)
• Trackbacks
• Share Link

I have written before about the conflict between local and federal regulation of green building.  But the issue of jurisdiction is not restricted to intergovernmental conflict.  At the federal level,  resources for green building are being largely handled by the Department of Energy, and not by the Environmental Protection Agency. 

The DOE runs the Energy Star program, for example.  In its page on "buildings" the DOE states:

The Department of Energy, through the Office of Energy Efficiency and Renewable Energy’s (EERE) Building Technologies Program works closely with the building industry and manufacturers to conduct research and development on technologies and practices for energy efficiency. The Department also promotes energy and money-saving opportunities to builders and consumers and works with state and local regulatory groups to improve building codes and appliance standards.

As you might expect, the DOE information is all about energy efficiency.  By contrast, the EPA has an informative page about green buildings, including information on water efficiency, sustainable communities, indoor air quality, waste reduction, toxics reduction and other considerations.  In short, the EPA takes into consideration the multi-faceted ways in which buildings impact the environment. 

Why should you care? On the EPA page regarding funding for green building projects it states:

EPA does not currently provide funding to support green building projects.

In the stimulus bill, which, you recall had $60 billion for "green" programs, the EPA was allocated exactly $0 for green building, and a measley $7 billion over all.  Don't believe me? Look at the EPA's own assessment of the stimulus money.  By contrast, the DOE was allocated $32.7 billion, with $5 billion for weatherization alone. 

The government agency charged with protecting the environment was essentially shut out of the "green" stimulus bill, and as a result, I wonder whether the overall environmental impact of buildings will be promoted effectively through research, incentives and other mechanisms.

• Email This
• Print
• Trackbacks
• Share Link