Hawaii Green Building Law

Rhode Island recently passed “The Green Buildings Act” (2009-S 0232B), requiring that all new major public facility projects and major building renovations in Rhode Island, including schools, be designed and constructed in conformance with high performance green building standards.

The new law applies to new construction of more than 5,000 square feet and renovation of spaces greater than 10,000 square feet if such projects receive any funding from the state. The law takes effect immediately but will apply only to buildings entering the design phase after Jan. 1, 2010.

Under the law, building design must conform to the United States Green Building Council Leadership in Energy and Environmental Design (LEED) rating system or an equivalent high-performance green building standard, including the Northeast Collaborative for High-Performance Schools Protocol.

Rhode Island’s green legislation is similar to the green building requirements established by the Hawaii legislature. However, the Rhode Island law only requires construction to meet LEED “certified” level, as opposed to an increased lever of LEED silver, gold or platinum. Under Hawaii law, each state agency must, among other things:

Design and construct buildings meeting the Leadership in Energy and Environmental Design silver or two green globes rating system or another comparable state‑approved, nationally recognized, and consensus‑based guideline, standard, or system, except when the guideline, standard, or system interferes or conflicts with the use of the building or facility as an emergency shelter.

Rhode Island lawmakers also addressed the liability issue. The law states:

37-24-6. Protection from liability. – No person, corporation or entity shall be held liable for the failure of a major facility project to meet the LEED certified standard or other standards established for the project as long as a good faith attempt was made to achieve the standard set for the project.

In other words, contractors, design professionals and any stakeholders involved in building green government buildings in Rhode Island will not face liability for the failure to the building to obtain LEED certification as long as a “good faith attempt” was made (notably the term “good faith attempt” was left undefined).

I’ve repeatedly written that green buildings are ripe for litigation. The Rhode Island statute attempts to address such liability up front, before construction. Hawaii’s green building statute does not address liability. Likewise, stakeholders involved in private, non-governmental projects even in Rhode Island do not fall under the protection from liability provision in the Rhode Island statute.

The risks are real and each party involved with a green building project must consider the risks and benefits in submitting bids and negotiating contracts. Stakeholders should consult with counsel with knowledge of green building certification.

Washington D.C. is pondering a new incentive to promote sustainability. The proposal authorizes a grant of $3000 to people who work in D.C. who relocate from their suburban homes into the city, where their commute would demand less energy.

The proposal is part of the D.C. Department of the Environment’s stimulus application for the U.S. Department of Energy’s State Energy Program.

At this point, it is not clear how whether $3000 is enough for people to relocate or how successful the grant program will be. However, creative incentive programs are key to guiding sustainability efforts.

In 2008, Honolulu was ranked as having the worst traffic drive times in the United States. Heavy traffic has not provided a significant deterrent to get Honolulu drivers out of their cars. Incentives, like the D.C. initiative may help reduce congestion, curtail urban sprawl, encourage mass transit use and create a more sustainable city.

A group of US senators, including Hawaii senator Daniel Akaka recently introduced the Livable Communities Act, a bill that would provide $4 billion to help cities and states pursue transit-oriented development, bicycle and pedestrian infrastructure, and other green transport projects.

The first proposed grant authorizes $400 million over four years for the implementation of regional plans that integrate sustainable housing, transportation, and community development. The second grant program spreads $3.75 billion over three years to assist localities in making their plans materialize, from affordable housing to bike-ped access.

According to Senate Banking, Housing, and Urban Affairs Committee Chairman Chris Dodd’s website, the Livable Communities Act will:

Create competitive planning grants that towns and regions can use to create comprehensive long-term plans that integrate transportation, housing, land use, and economic development.

Create challenge grants that towns and regions can use to implement these long-term plans through investments in public transportation, affordable housing, complete streets, transit-oriented development, and brownfield redevelopment.

Establish a federal Office of Sustainable Housing and Communities at the Department of Housing and Urban Development to administer and oversee the Livable Communities grant programs;

Establish a federal Interagency Council on Sustainable Communities that will include representatives from the Department of Housing and Urban Development, the Department of Transportation, the Environmental Protection Agency, and other federal agencies to coordinate federal sustainable development policies.

Under the current version of the proposed act, the amount awarded under the grant program to an eligible entity that represents all or part of a metropolitan statistical area with a population of 500,000 or more, such as Honolulu, may not exceed $5,000,000. In determining whether to award a grant, the proposed Office of Sustainable Housing will evaluate whether the proposal:

(1) furthers the creation of livable communities;

(2) demonstrates the technical capacity of the eligible entity to carry out the project;

(3) demonstrates the extent to which the consortium has developed partnerships throughout an entire micropolitan or metropolitan statistical area;

(4) demonstrates a commitment to–

(A) sustainable development;
(B) location-efficient and transit-oriented development;
(C) developing new capacity for public transportation and increasing ridership on public transportation;
(D) providing affordable, energy-efficient, and location-efficient housing choices for families of all ages, incomes, races, and ethnicities;
(E) creating and preserving long-term affordable, energy-efficient, and location-efficient housing for low-, very low-, and extremely low-income families;
(F) revitalizing communities, neighborhoods and commercial centers supported by existing infrastructure;
(G) monitoring and improving environmental quality, including air and water quality, energy use, greenhouse gas emissions, and the redevelopment of brownfields; and
(H) coordinating the provision of transportation services to elderly, disabled, and low-income populations;

(5) demonstrates a plan for implementing a comprehensive regional plan through regional infrastructure investment plans and local land use plans;

(6) promotes diversity among the geographic regions and the sizes of the population of the communities served by recipients of grants under this section;

(7) promotes economic benefits;

(8) demonstrates that a Federal grant is necessary to accomplish the project proposed to be carried out;

(9) has a high quality overall; and

(10) demonstrates such other qualities as the Director may determine.

The Livable Communities Act could provide another source of funds to assist in the City and County of Honolulu’s proposed rail project and the associated transit-oriented development that is sure to follow. Nevertheless, the recently introduced Act still has a long road ahead of it.

Classic battles–McDonalds versus Burger King…Coke versus Pepsi…Yankees versus Red Sox. Should we add LEED versus Green Globes to the list?

LEED

The best known green building certification program is Leadership in Energy and Environmental Design (LEED). Developed by the U.S. Green Building Council in 2000, LEED (at least currently) is recognized as the market leader and has been incorporated as the standard in many local building codes and state statutes. There are four levels of certification–certified, silver, gold and platinum. A building must satisfy several prerequisites before it can earn points. Points are generated within the following six categories:

Sustainable sites
Water efficiency
Energy and atmosphere
Materials and resources
Indoor environmental quality
Innovation and Design

LEED certification is a paperwork-intensive process. Each point that is sought requires submissions, and while the process itself is conducted online for the most part, the accumulation of data and supporting material is extensive and often extends past final completion.

In comparison to other rating programs, LEED is expensive. It has been estimated that the LEED process costs between 1 and 9 percent of the overall project cost. In addition, current estimates to document, manage, and report project compliance through the USGBC certification process range from approximately $10,000 to $60,000 per project. These estimates will vary on a project-by-project basis and will depend on the complexity of the building type, the green measures targeted, the LEED Rating pursued (how many credits to document) and the level of green building experience of the stakeholders.

Green Globes

Green Globes was developed by the Green Building Initiative and positions itself as a more economical, practical and convenient alternative to LEED. In order to avoid antitrust issues, several local codes and state statutes, including Hawaii’s statute, incorporate the Green Globes rating system in addition to LEED. Green Globes uses a 1000-point system, although the applicant may confirm that certain points are inapplicable for the project. The Green Building Initiative issues one to four globes based on the percentage of applicable points achieved.

Unlike LEED, Green Globes does not have prerequisites. All actions implemented into the building count toward certification points. Points are accumulated in the following categories:

Site
Water
Energy
Resources
Indoor environment
Emissions, effluents and other impacts
Project management

One of the criticisms of Green Globes is its lack of prerequisites, allowing developers to ignore certain sustainability categories. In contrast, LEED takes a whole building approach to sustainability.

The Green Globes focus clearly is on energy use. While the number of points is relatively balanced among the six point categories in LEED, more than 35% of the points awarded under Green Globes fall under the energy category.

The total registration and verification cost for Green Globes, not including facility improvements, is typically between $5,000 and $7,000. In comparison, LEED registration and certification costs are approximately $13,000 for a 500,000-square-foot project. In contrast to LEED, Green Globes provides a Web-based self-assessment tool that can be completed by any team member with general knowledge of the building’s parameters. Green Globes, however requires an on-site inspection by a verified certifier; LEED does not.

The green building certification debate rages on. Certification can be a significant additional project expense; however, certification costs should not be viewed as the cost of “going green.” LEED is a more rigorous process but it currently is the market leader.

A lot has been written about the USGBC’s decision to de-certify projects that fail to meet the USGBC’s minimum program requirements. I predict that if the USGBC ever wields its de-certification powers, government projects will be among the first to face de-certification.

Several governmental entities have mandated that government buildings be LEED certified. Hawaii law requires all major state renovation or construction projects be designed and built to meet LEED silver or Green Globes standards. Several new state building projects have achieved LEED certification, including the Waipahu Intermediate School cafeteria and University of Hawaii’s John A. Burns School of Medicine.

While state projects are now required to be built green, budget concerns often leave government buildings without adequate funding to cover the construction of LEED buildings. Once built, the state often does not have adequate money or resources to cover necessary maintenance.

At this point, a project can be de-certified if it fails to provide ongoing monitoring data. The USGBC has not yet stated what will happen if a building’s energy and/or water usage is higher than projected, which could occur if a building is not properly maintained. Nevertheless, even if a project achieves LEED certification, funding issues could prohibit the state from keeping up with the USGBC’s minimum program requirements.

As previously discussed, potential de-certification could set off a wave of litigation between the developer and each stakeholder involved in the design, construction or occupancy of the project. Addressing risk and potential liability issues early on in the planning process is now a necessity.

The Hawaii Legislature has overridden Governor Lingle’s veto of SB50. The bill requires the Board of Land and Natural Resources to conduct at least two public hearings before leasing any public land to an entity seeking to develop a renewable energy project.

Proponents of the bill seek to create greater transparency and community participation in the leasing of public lands. Governor Lingle believes however that renewable energy projects already go through an approval process through various state and county agencies. Requiring hearings specifically for renewable energy producers increases costs and delays. The bill also requires renewable energy projects to publicly disclose business sensitive information, such as its financing plan.

It remains to be seen how these new lease requirements will effect Hawaii’s renewable energy industry. Both sides are correct, the legislation will create more transparency, however the additional red tape will add to the costs and time frame for developing renewable energy projects. Developers of proposed renewable energy projects may be driven to lease more private property rather than dealing with the increasing governmental regulations that accompany public land leases.

The Obama administration announced that Hawaii and five other states and territories will receive more than $141 million in Recovery Act funding to support energy efficiency and renewable energy projects. Hawaii’s share of today’s award is $10,372,000.

The Department of Energy’s State Energy Program (SEP), provides grants to states that have proposed statewide plans that prioritize energy savings, create or retain jobs, increase the use of renewable energy, and reduce greenhouse gas emissions. Activities eligible for SEP funding include energy audits, building retrofits, education and training efforts, transportation programs to increase the use of alternative fuels and hybrid vehicles, and new financing mechanisms to promote energy efficiency and renewable energy investments.

Hawaii will use its Recovery Act funding to improve energy efficiency and expand the deployment of renewable energy technologies, which will help advance mutual state and national goals for creating and maintaining jobs, reducing oil dependence, and reducing greenhouse gas emissions. Hawaii’s energy efficiency strategy will directly fund high performance buildings, government and residential building retrofits, and energy efficiency measures in the state’s hospitality industry. The program will also provide technical assistance and training to building owners, developers, design professionals, and county building code officials to ensure that new and renovated buildings are designed and built with high efficiency measures. Hawaii will target bringing buildings to ENERGY STAR and Leadership in Energy and Environmental Design (LEED) standards.

The Collaborative for High Performance Schools (”CHPS”) calls itself a “leading a national movement to improve student performance and the entire educational experience by building the best possible schools.”

Earlier this year, the Hawaii legislature passed HB 986, which would mandate:

Design and construct[ion of] all public school facilities, including renovation projects under five thousand square feet, to meet the Collaborative for High Performance Schools rating system, except when the guidelines conflict with the use of the facility as an emergency shelter;

HB 986 was among the measures highlighted in last month’s post on Hawaii Green Legislation for 2009. Last Friday, July 10, 2009, the measure was vetoed by Governor Lingle as part of a series of legislative vetoes reportedly made for budgetary reasons. It remains to be seen whether her veto will be overridden, which requires a 2/3 majority vote of both the House and Senate.

Looking at the text of the bill, it is not set forth how a school can “meet the CHPS rating system” as required by the law. Existing CHPS guidlines appear to be state specific, with assessment criteria available for California, Washington, Texas, New York, New Hampshire, Rhode Island, Connecticut, Maine, Vermont, Massachusetts and soon, Colorado (but not Hawaii). According to the CHPS website, independent review of CHPS projects applies only to projects in California, Colorado, Texas and Massachusetts, while a self-certification process has been outlined for projects in California, Texas, New York, Washington and the Northeast (again, Hawaii is not yet on the list).

If the bill becomes law over the governor’s veto, it remains to be seen how the provisions of the law would be implemented. Presumably CHPS criteria for Hawaii would need to be developed. Who would be responsible for developing such criteria? What incentives for compliance with CHPS criteria or penalties for non-compliance would be permissible for architects, designers, contractors and other project members? Should the bill become law, RFPs and design and construction contracts under the mandate would be ripe for misunderstanding and disappointment, and therefore must clearly set forth the expectations and requirements of all involved in such a project.

Tucson, Arizona enacted the nation’s first municipal rainwater-harvesting ordinance for commercial projects. Starting next year, Tucson developers building new business, corporate or commercial structures are required to supply half of the water needed for landscaping from harvested rainwater.

According to the Associated Press, several other communities are also seeking to adopt legislation to require rainwater harvesting.

Rainwater harvesting refers to the collection and storage of rain. Collection is usually from rooftops, and storage in catchment tanks.

Experts estimate that more than 185,000 acre-feet of rainfall is available for harvesting in the Tucson area each year, compared to the 131,000 acre-feed of water delivered each year by Tucson’s water utility.

Hawaii has not yet enacted legislation requiring rainwater harvesting. Disputes over water use and ownership have been ongoing in Hawaii for many years. Conflicts in the allocation of water resources will increase as Oahu’s population grows and shifts to more arid areas such as Kapolei and the Ewa plain.

Will Hawaii lawmakers look to rainwater harvesting to help ease the increasing demand for water?

Effective today, residential property owners selling their house must declare the cost of electricity for the property to a proposed buyer.  This measure is part of House Bill 1464 of the 2009 Hawaii legislative session, which was signed into law last week as Act 155 and goes into effect today, July 1, 2009.

The act encourages renewable energy use and development and energy efficiency, and also includes the following provision:

§   -    Energy-efficiency consumer information in sale or lease of real property.  Prior to the sale of residential real property, the property owner shall make a good faith declaration of electricity cost based on the most recent three-month period in which the property was occupied prior to the date of the seller’s disclosure, pursuant to chapter 508D.

Chapter 508D of the Hawaii Revised Statutes generally requires the seller of residential real property to provide a disclosure statement to a buyer within 10 days from the acceptance of a real estate purchase contract.  The disclosure statement must fully and accurately disclose facts, defects, or conditions that would be expected to measurably affect the value of the residential property offered for sale.

It is not clear whether the new provision relating to electricity costs is considered a disclosure pursuant to chapter 508D.  If it is, does a buyer then have the right to rescind a real estate purchase contract and have all deposits returned based on electricity cost the buyer considers to be too high?  What happens if the seller is an energy miser but the buyer an energy hog?  Might the seller’s disclosure then be considered misleading or negligent?

Such questions are not easily answered as the cost of electricity can vary greatly for a single property based on not only the number of occupants in a house, but also on the habits of those occupants concerning the use of air conditioning, the length of showers, the amount of laundry generated, whether the laundry is line dried or machine dried, etc.

Disclosing the electricity cost of a property alone as required under the new law tells one little about the energy efficiency of a property.  Moreover, such numbers might be easily manipulated by sellers who suddenly find themselves living a greener, more energy efficient lifestyle in anticipation of their house being put on the market.

In my view, this provision will do little to encourage green homes.  A seller’s utility bill alone is not a reliable indication of a property’s energy efficiency.