Bill Wallace: Efficient design pays off

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Regarding the article in Steamboat Today, “City of Steamboat reviews LEED certification requirements,” the efforts by the local development community to drop the LEED energy and environmental performance certification requirements on single-family and duplex construction in the mountain base area are at best ill-informed. At worst, they are a blatant and outright shameful attempt to shift costs on to the owners and tenants, and ultimately on to the city and its taxpayers.

LEED standards recognize that the largest costs of a building are in its operation, not in its design and construction. Allowing developers to skimp on investments in energy and water savings in the building design phase only serves to pass the resulting increased operating costs on to the building owners and tenants. Aggregated together, increases in building energy and water demands increase the burden on our energy, water and wastewater infrastructure. Ultimately, this will require an increase in taxes to fund the requisite infrastructure maintenance and expansion.

As the noted author Peter Senge pointed out in his book, “The Necessary Revolution, How Individuals and Organizations Are Working Together to Create a Sustainable World,” LEED transformed the building industry, changing the approach to building development from a “race-to-the-bottom” to a “race-to-the-top.” Before LEED came on the scene, the developer focus was on first costs, i.e., set the budget as low as possible in order to maximize profit. That focus results in a race-to-the-bottom, with architects, engineers and contractors working to build what amounts to the worst performing building you can build and still meet code.

LEED shifted the focus from first costs to life cycle costs. In effect, the system alerted the owners and tenants to the high and hidden operations and maintenance costs due to, among other things, higher energy and water consumption. It showed how up-front investments in better and more resource-efficient designs can be recovered quickly through operational cost savings. With LEED, building development shifted to a race-to-the-top, as architects, engineers and contractors work to identify and implement new technologies to support the LEED brand.

LEED was always intended to be a marketing tool for building developers and owners. The U.S. Green Building Council, the organization that operates the LEED certification system, set out to brand LEED as a provider of tangible value to building owners. Buildings that have earned a LEED certification have significantly higher selling and leasing prices. In fact, upon earning a LEED certification, the first thing the building owner receives from the council is an eye-catching wall plaque for the building, along with guidance on how to advertise the achievement.

If the Steamboat Springs development community wants the city to drop the LEED certification requirement because third-party certification costs too much, then I submit that the development community either doesn’t understand or is incapable of capitalizing on the value that LEED certification offers. Moreover, a quick Internet search for LEED certification costs yielded results of $1 per square foot or less. Looking at housing prices at the Steamboat base area, that cost is well below 1 percent of the per square foot real estate prices.

I urge the City to take a broad view of LEED certification requirements, looking beyond what appears to be the miniscule cost of certification. Requiring LEED certification not only increases building value, but brands the city as a place that understands how to leverage that value in a resource and cost-conscious community.

Bill Wallace

Steamboat Springs

Comments

Ken Mauldin 8 months ago

In the first paragraph, efforts to drop the requirement for LEED Certification are described as a "blatant and outright shameful attempt to shift costs on to the owners." Yet the fifth paragraph touts LEED Certification as a marketing tool that causes certified buildings to "have significantly higher selling and leasing prices," which is presumably a good thing.

Why not allow the builder to determine what's in their best interests and choose between building a structure that costs less to build or costs more to build? Likewise, why not allow the buyer to determine what's in their best interests and choose between higher operational costs or a higher initial investment in a more efficient building?

What's so bad about a person being free to choose what's in their own best interests?

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Bill Wallace 8 months ago

Nothing is bad about a person being free to choose what's in their best interests. The ultimate owner ought to be fully informed about the issues, one of which is what it's going to cost him/her to operate and maintain it versus the purchase price. This is about having complete information.

Moreover, this isn't just about one buyer-seller transaction. Many cheap and low efficiency buildings places additional burdens on the City's energy, water and wastewater infrastructure. Required upgrades to meet the additional demands are paid for by taxes.

Are such burdens acceptable as long as they are paid for by the user? I don't think so. Regardless of who pays, more scarce resources are being used.

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Ken Mauldin 8 months ago

Thanks for your thoughtful reply, Bill.

I maintain a healthy skepticism where government mandates are concerned. When any entity has the authority to decide who-pays-how-much-for-what, things can get dicey pretty fast. Scarcity actually provides a self-limiting solution. As more of any scarce resource is consumed the price goes up and people self-regulate (in this case, builders and buyers) because it's in their own best interests. While it's easy to demonize profits as a "race to the bottom", 'prices' as determined by free-exchange is the most efficient means to allocate scarce resources. Regulating or compelling terms of exchange leads to distortions and inefficiencies in markets. See: Housing prices in NYC, and other rent-control districts, as examples of this distortion. While reasonable people can disagree on the amount of coercion and regulation, I tend to err on the side of free exchange with the understanding that it's more efficient and sustainable than a model of government-fixed pricing.

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Scott Wedel 8 months ago

"LEED was always intended to be a marketing tool for building developers and owners."

I think that is the basic issue. That the LEEDS certification process adds costs without improving the building under construction.

Current building codes have insulation, water efficient toilets and other building efficiency standards. Thus, the city dropping a requirement of getting LEEDS is not going to allow construction of energy inefficient homes.

Requiring LEEDS certification is sort of similar as requiring NRA or Sierra Club certification. Maybe useful for marketing to some potential buyers, but hardly essential to build a quality house.

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mark hartless 7 months, 4 weeks ago

Why not let individuals decide what they need, instead of making everything either mandatory or forbidden? Jeez, you busy-bodies need to go away and leave people alone for a while.

Energy efficient buildings are well worth their costs- to a certain point. But that's IF one has the money. Mercedes Benz is well worth the cost too, but some people struggle to afford a Subaru. They should not be impoverished or put out in the cold because they can not afford another man's vision of perfection.

Some are struggling just to keep the least expensive roof possible over their family's heads. The extra rent or house payment of a decked-out LEEDS home would put them out in the cold and THAT would be less comfortable than a less than perfect home.

When rents or house payments climb then dental visits, college savings, preventative medicine, family vacations and other important things are reduced. This is the LAW of economics. All THESE things factor into life as well!

It is unfortunate that so many who apparently have financial resources fail to consider the many who struggle.

Another consideration is why, exactly, do we insist on incorporating such longevity into structures which might be replaced in a decade or two with shopping malls, schools or police stations long before their LEEDS stuff has time to pay reasonable returns?

Additionally, one could argue that, given the exponential improvements being made in building design and materials, there might actually be a case for purposely NOT putting such longevity and such rigorous design into each and every structure. We may find even MORE efficient materials right around the corner but be "stuck" with an expensive and outdated building that we can't get rid of... kind of like the government which mandated it.

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mark hartless 7 months, 4 weeks ago

And if we'd drill some freakin oil and gas wells then energy costs would be more stable or even reduced, thereby making LEEDS even LESS necessary...

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Bill Wallace 7 months, 4 weeks ago

First, thanks all for the thoughtful comments...frequently rare in these pages. A few additional points.

LEED (it's not LEEDS), which stands for Leadership in Energy and Environmental Design, was created at a time when building "green" became popular and many builders, both commercial and residential, were engaged in "greenwashing," declaring that their buildings were energy efficient, environmentally friendly, etc., without any justification. Buyers were desperate for some kind of standard to discriminate among choices and LEED filled that gap.

Regarding the cost of buildings that meet LEED standards, my "poster child" for doing things right is the Poudre School District in Fort Collins. Their facilities people won national awards for designing and building schools that meet/exceed all the LEED standards. About 12 years ago, the City passed a bond issue to build/refurbish their schools. The school superintendent gave the facilities people the freedom to build "green" so long as they stayed within budget. There are a lot of details I could go into, but the punchline is that the Poudre District schools cost 10-15% less to build and 30-50% less to operate than conventional Front Range schools. I teach classes in sustainable engineering and have taken the students to Fort Collins to tour the school buildings and talk to the facilities folks.

Poudre's feat was accomplished not through some magic bullet technology, but by better project design and management. The reason LEED certified building tend to cost more is that the designers and constructors aren't very good at integrating the improved technologies and systems into the building design. Their approach is to do a conventional design and just add sustainable features on the top. I've termed this "accessorizing for sustainability."

Stu Reeve, Poudre's energy manager, has visited Steamboat several times to speak to the Yampa Valley Sustainability Council. Sorta like preaching to the choir. Not sure if he's spoken to city or county officials.

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Scott Wedel 7 months, 4 weeks ago

Bill,

If LEED was generally a cheaper way to build then the free market would have a strong incentive to use it and there would be no need for government mandate.

If buyers want LEED certification then the free market would have a strong incentive to use it and there would be no need for government mandate.

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Scott Wedel 7 months, 4 weeks ago

LEED also does not guarantee particularly energy efficient buildings because it is a point based system so it can be gamed to get points in relatively inconsequential areas such as including an educational display or an exercise room. It appears that mandating LEED certification can result in a design to get certification that can then cheaply be remodeled into what isn't LEED compliant, but is what the owner wants.

A NYC study suggests that LEED certified buildings are not more energy or water efficient than other new construction.

LEED is overall a reasonable idea and a builder may be well-advised to seek LEED certification, but it should not have been mandated by the City of SB.

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Bill Wallace 7 months, 4 weeks ago

LEED can be "gamed," but there are limits. Unless your project meets stringent requirements for things like energy and indoor air quality, it doesn't get certified.

Regarding the NYC study, one would need to understand what's being compared. What are the codes the "other new construction" is following? Did the developer decide to install extra insulation?

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mark hartless 7 months, 4 weeks ago

I totallt agree with Scott. Are we to ask government to mandate every "good idea"? And what is "good " about any concept must always be weighed against alternatives and economics, rather than in a simple, unrealistic vacuum of saying "this is good, therefore it should be law".

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Dan Kuechenmeister 7 months, 4 weeks ago

What ever happened to freedom to choose. Life is all about choices and living with the consequences of those choices. There are way too many "rules".

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Scott Wedel 7 months, 4 weeks ago

I slightly disagree with Mark.

When government law mandates something that is considered a good idea then the focus shifts from the general situation in which it is a good idea to all of the situations in which it may not be such a good idea. Thus, to mandate a good idea should require government to be sure that it is always a good idea for all situations.

A low flow toilet should be simply a better design and there should be no situation in which a high flow toilet is needed. The amount of water saved by the water district can be the difference between having a water shortage and thus a community not being allowed to grow. So mandating low flow toilets is reasonable.

But mandating LEED certification can easily be just a costly hurdle to bypass for someone wanting their own custom home. They end up designing a house to get LEED certification that is the least expensive to then remodel into what they want.

The most telling aspect of SB's LEED certification as being a poor idea is that it was required for only part of the city. If it was such a good idea then it would have been required citywide.

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Bill Wallace 7 months, 4 weeks ago

I see where this is going. OK, let's not have rules. Let everybody have the freedom to choose and live with the consequences. Tell that to the parents of the kids that were on that South Korean ferry that sunk recently. It was just reported that the boat was carrying more than 3 times more weight in cargo than the boat was designed to carry. Tell that to the families who lost relatives in the collapse of the garment factory building in Bangladesh which incidentally happened exactly one year ago. In that case, the building owner violated building design standards and added an extra level and used substandard materials.

These examples go well beyond the scope of LEED, but they are meant to point out that many times we need to have standards and rules, along with the requisite enforcement, to protect the public from unnecessary risk to health, life and property. The question is where do you draw the line.

Personally, I have no qualms about establishing rules for energy and water conservation in the City. Save enough and you avoid the huge costs and associated tax burden of having to add new energy and water systems capacity. Water utilities are paying customers to replace their toilets and water fixtures and are getting substantial returns on that investment. Wasn't Steamboat Springs doing this?

I'm happy to let people be free to choose, so long as the result isn't, as writer Tom Friedman put it, being "as dumb as we want to be," and those choices don't negatively affect me.

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Dan Kuechenmeister 7 months, 4 weeks ago

Wow Bill. I am curious where in my 26 word post did I say there should be no rules. Well duh, there should be safety rules and what in heavens name do the 2 tragedies you referenced have to do with LEED certification. I believe that a person should be able to choose to build or not build a LEED certified house in any part of Steamboat they so choose. Speaking of silly rules In Sun Prairie, Wisconsin No rider of a bicycle shall remove both hands from the handlebars or practice any trick or fancy riding in any street in the city nor shall any bicycle rider carry or ride any other person so that two persons are on the bicycle at one time, unless a seat is provided for a second person. Source: Section 10.32.020 Manner of operation restricted. It's a good thing I did not grow up in Sun Prairie, WI. How about you?

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Scott Wedel 7 months, 4 weeks ago

Bill,

The NYC study simply compared new construction water and energy usage. That LEED certification in terms of energy and utilities isn't any better than construction quality already wanted by owners.

So then you are fine with removing LEED certification requirements as long as SB retains building codes requiring structural integrity?

Seems to me that if you want SB to retain requiring LEED certification then you need to say why LEED certification is appropriate for all new construction, is always cost effective and isn't vulnerable to being gamed with an after certification remodel.

Personally, I think any points based system is highly vulnerable to being scammed by collecting points as cheaply as possible. That it would make more sense to try to add an interior air circulation and replacement air preheating system building code requirement for SB than to have that as a point option for LEED certification that maybe can be avoided with an educational display and an exercise room.

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mark hartless 7 months, 3 weeks ago

You jackwagons always traqnslate "don't be a dictator" into "let's not have any rules and let everybody die..."

What a load of crap.

How do the LEEDS standards in the town of Steamboat Springs Colorado, USA apply to a South Korean Ferry boat sinking, Bill?

How do LEEDS standards in Northwest Colorado apply to buildings in Bangladesh???

What a total load of CRAP.

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Bill Wallace 7 months, 3 weeks ago

I see that reading comprehension isn't exactly a strength in this group. Why am I not surprised.

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Dan Kuechenmeister 7 months, 3 weeks ago

So Bill, let me rephrase my question. Where in my 3 sentence post did I say to quote you "OK let's not have rules". Nice attempt at an insult by the way. “I didn’t come here to be insulted!” to which Groucho quips “Oh really? Where do you usually go?”

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Scott Wedel 7 months, 3 weeks ago

Well, that is one way to respond to the challenge of:

Seems to me that if you want SB to retain requiring LEED certification then you need to say why LEED certification is appropriate for all new construction, is always cost effective and isn't vulnerable to being gamed with an after certification remodel.

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mark hartless 7 months, 3 weeks ago

Then help me "comprehend". How do LEEDS standards apply to a South Korean ferry sinking? How do LEEDS standards apply to Bangledesh building codes???

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Scott Wedel 7 months, 3 weeks ago

Seems to me that we have a failure to communicate.

The skeptics are asking why it should be mandated since even a good idea may not always be best everyone in all situations.

The proponent say it should be mandated because it is a good idea.

Which, I suppose, suggests why it was passed by a prior city council and repealed by this city council. It was passed because it was a good idea. It was repealed because it was not a good idea in too many specific cases.

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