Monday, November 30, 2009

Contracts with Subcontractors in Green Construction

  1. Subcontractors:
    1. Include indemnity clauses for their role in the installation
    2. Require lien waivers when work is complete and subs have been paid.
    3. Make sure your subs are well versed in the installation of the “green” product.
    4. Provide them with manufacturer’s documentation in order to ensure warranty.

Saturday, November 28, 2009

The Green Contract with the Consumer

1. Contract with Consumer

    1. Include type of certification sought and appendix with all requirements.
    2. Have consumer initial all pages and sign off.
    3. Do not promise what you can’t deliver.
    4. Installation is on builder but can have indemnity agreement with subcontractor.
    5. Failure to install properly can invalidate manufacturer’s warranties.
    6. Designate who is responsible for rebates
    7. Can always provide a warranty for your workmanship.
    8. Include suggested guidelines for performance, but do not guarantee performance.
    9. Spell out homeowner’s responsibilities to ensure performance.
    10. Include change orders for a greater than ten percent increase in the cost of materials.
    11. Include the right to substitute like materials if a given item is no longer available.

Friday, November 27, 2009

The Contract in Green Construction

  1. The Contract is your most important protection against risk. Cover all potential areas of risk in your contract.
    1. Types of contracts

i. Builder/Owner

ii. Builder/Designer

iii. Builder/Subcontractor

iv. Builder/Supplier

Thursday, November 26, 2009

Performance of Green Buildings

1. Performance

    1. Avoid guarantees if possible.
    2. Allocate risk amongst builders, subcontractors, suppliers and owners.
    3. Account for regional variations
    4. Only pass on manufacturer’s warranties
    5. Discuss maintenance responsibilities

Tuesday, November 24, 2009

Warranties in Green Construction Contracts

1. Warranties

a. Clearly delineate warranties for materials, installation and performance.

b. Allocate risk

c. Beware of implied warranties in your state.

Monday, November 23, 2009

Green Materials and Supplies

1. Green materials and supplies

a. Beware of “greenwashing” and potential for fraud.

b. Educate yourself about options.

c. Include disclaimers for materials chosen by consumers

d. Pass on manufacturer’s warranties

e. Beware of implied warranties in your state

Sunday, November 22, 2009

The International Living Building Institute (ILBI)

In prior posts, I have brought up the possibility that other green certification standards may surpass LEED. Here is a blog post about a standard that claims to go beyond LEED and consider issues that LEED does not cover, such as beauty and aesthetics:


What do you folks think of the ILBI standard?

Rebates and Tax Incentives

1. Rebates and Tax Incentives

a. Familiarize yourself with requirements for rebates and tax incentives.

b. Designate responsibility for the acquisition of rebates.

c. Avoid guaranteeing acquisition of rebates to homeowners if possible.

Saturday, November 21, 2009

Considerations Regarding Certification

Certification
a. Discuss options with homeowners.
b. Consider design team to maximize cost savings
c. Provide overview to homeowners.
d. Decide whether it’s worth to receive a level of certification.
e. Make sure homeowners are aware of increased financial burden
f. Familiarize yourself with local and state laws that may affect certification (zoning, conservation commission).
g. Changing nature of certification (requirements are fluid)
h. Potential for need to renew certification.

Friday, November 20, 2009

Types of Certification Available for Green Residential Construction

  1. Many standards to choose from:
    1. LEED for homes
    2. NAHB Green Building Certification http://www.nahbgreen.org/Certification/homecertification.aspx
    3. Energy Star
    4. Proposed Standard 189, Standard for the Design of High-Performance Green Buildings Except Low-Rise Residential Buildings, is being developed by the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) standard

e. American National Standards Institute (ANSI). The resulting ANSI approved ICC-700-2008 National Green Building Standard defines green building for single and multifamily homes, residential remodeling projects and site development projects while still allowing for the flexibility required for regionally-appropriate best green practices. Similar to the NAHB Model Green Homebuilding Guidelines, a builder, remodeler or developer must incorporate a minimum number of features in the following areas: energy, water, and resource efficiency, lot and site development, indoor environmental quality, and home owner education. The more points accrued, the higher the score. The Standard, however, includes more mandatory items and suggests that higher thresholds be met in several categories. A new threshold - "Emerald" - was added to denote the highest achievement in residential green construction.

Thursday, November 19, 2009

Why Green Construction Could Be Less Expensive

We in the field who follow developments in green construction frequently hear that it is wonderful to "go green," but unfortunately it is usually more expensive. For that reason, "green" is still more of an upper class option, or one for those who do it because they are committed to improving our environment.

Some experts say that green can be a "no lose" proposition when the construction is carefully planned, and the energy savings performance offsets the increased costs of construction, materials and supplies. However, the amount of funds saved may not offset the initial cost of green construction for years. The calculations seem to indicate that they eventually will.

One of the factors in making a green construction project a success is planning. Ideally, the project will have all of the subcontractors on board from the beginning. Materials will be chosen in advance. The team will coordinate and work together when the project commences. Design defects will be discovered. Everyone will be on the same page. Disagreements will surface early and be resolved.

All of these characteristics of a properly orchestrated green project can save huge amounts of money that is wasted on unnecessary delays, errors that require fixing, mis-ordered or delayed supplies, subcontractors who do not show up when expected, etc.

In a perfect world, projects operate like clockwork, delays never occur, costs never increase, and concealed conditions do not exist. However, that is not the reality of the life of a construction project. Interestingly enough, the model for how to properly execute a green construction project can clearly prevent a number of these issues. That's why I believe that green construction projects do not only make environmental and moral sense, they make economic sense as well.

Resources for Information Regarding Green Construction

  1. Resources
    1. NAHB-National Green Building Program http://www.nahbgreen.org/
    2. LEED for Homes http://www.usgbc.org/DisplayPage.aspx?CMSPageID=147
    3. ANSI Green Building Standard http://www.nahbgreen.org/Guidelines/ansistandard.aspx
    4. ASHRAE Green Building Standard http://www.ashrae.org/pressroom/detail/16309
    5. Green Real Estate Law Journal http://www.greenrealestatelaw.com/
    6. Green Building Law Update http://www.greenbuildinglawupdate.com/
    7. Green Building Law http://www.greenbuildinglawblog.com/

Potential Areas for Risk in Green Construction

  1. Potential areas for risk:
    1. Certification
    2. Rebates and tax incentives.
    3. Green materials and supplies
    4. Installation
    5. Warranties
    6. Performance

Monday, November 16, 2009

Starbucks and LEED Certification

Before I continue with my legal issues in green construction series. I have to report about two of my main interests in life these days: Starbucks and LEED certification.

Starbucks is my favorite coffee. In fact, if I must admit it, I am a little obsessed.

They are using their market influence to adopt a practice for LEED certification for all of their new stores. They are also using LED lights. That helps justify my spending $3.50 on a cappuccino. After all, it's for a good cause.

Here's the article:

http://www.reuters.com/article/mnGreenBuildings/idUS32581121620091113

Friday, November 13, 2009

Green Building Addendum from Consensus Docs

Thank you Matthew DeVries for this post on the new green provisions available from Consensus Docs. This goes well with my series on green building:

http://www.bestpracticesconstructionlaw.com/2009/11/articles/green-building/hot-off-the-press-consensusdocs-releases-green-building-addendum/

Wednesday, November 11, 2009

Legal Issues to Consider in Green Construction

I recently participated in a webinar for Professional Builder Magazine called Legally Green: Deliver the Green You Promise. In that presentation, I discussed the additional risks for liability in green construction and how builders can protect themselves. I am going to publish a series of posts that summarize the areas that I have identified that may cause disputes as time goes on.

First some statistics from around the Internet regarding the current status of green construction on the residential side:

Green building is up even though construction is down. The National Association of Home Builders recently released figures from a survey of multi-family builders and developers.

74 percent of respondents said that their buyers and renters are willing to pay more for green amenities. However, the median additional amount that they’re willing to pay is just 2 percent.

89 percent of respondents (again, multi-family builders and developers, nationwide) said they are currently installing energy-efficient appliances and lighting in their projects; 79 percent are installing low-E windows; 64 percent are incorporating recycled materials and 50 percent are installing greater insulation than required by local code.

http://www.contractorheadlines.com/2008/09/green_building_statistics_dema.html

On the residential side, McGraw-Hill Construction’s 2008 summary shows that 56% of green home purchasers earn less than $75,000 per year and that 29% earn less than $50,000. http://theleed.com/2009/04/the-statistics-are-bullish-on-green/ Homeowners are attracted by lower operating costs and receive less expensive utility bills because of energy and water efficiency measures. Green homes are more comfortable and have relatively even temperatures throughout the home, with fewer drafts and better humidity control. Environmental quality is improved because builders pay extra attention to construction details that control moisture, choose materials that contain fewer chemicals, and design air exchange/filtration systems that can contribute to a healthier indoor environment.

Green homes have enhanced durability and require less maintenance. They incorporate building materials and construction details that strive to increase the useful life of the individual components and the whole house. Longer lasting materials not only require fewer resources for replacement but also reduce maintenance and repair costs. Green homes have lawns that require less weeding and watering, building elements that require less maintenance, and more durable building components that reduce the time needed for upkeep.

It is important to note that a builder can do only so much when it comes to how the home will perform. Homeowners play a big role in the house performance and, therefore, should be instructed on how to operate the green home as it was intended. Anecdotally, builders are adding green features even without advertising them.

The next post will discuss types of certification available.

Wednesday, November 04, 2009

How Construction Clients Can Help Themselves

Here's to Timothy Hughes, who wrote this post:


I will add one: I try to respond to clients as quickly as possible when they contact me. Please afford me the same courtesy.

Monday, November 02, 2009

Stimulus Dollars and Massachusetts Construction

Here's an exciting piece of information. Finally some goods news from Chris Thorman, who blogs about construction estimating software. MA is the top job generator with stimulus dollars for construction.

http://www.softwareadvice.com/articles/construction/state-by-state-is-the-stimulus-bill-creating-construction-jobs/

Sunday, November 01, 2009

Hotel Goes Green, but Forgoes LEED Certification

As you may know, I am taking a class in LEED 2009, and am considering taking one of the exams. One of the questions that keeps plaguing me is why bother? The documentation process is incredibly detailed, the requirements are extensive and one has to hire a commissioning agent for some of the credits. I keep wondering how much expense is added when one tries to attain LEED certification and whether it's just an option for the elite.

This blog post speaks to that issue and actually spells out the numbers.

http://www.hotelinteractive.com/article.aspx?articleid=15282

As the article states, "Doing the government documents alone cost $50,000." This does not make me happy. On the one hand, we are told that LEED certification is the goal. It is an achievement of which to be proud. It shows a dedication to preserving and improving our environment. However, a consultant and/or commissioning agent is usually required, and now further regulations have come into effect requiring reporting of water usage and energy performance for five years, with the ever-looming threat of de-certification.

With other certification processes out there, will LEED win out? Will people still bother becoming LEED accredited? What do all of you think? I predict that the market will start demanding more flexibility in LEED, or it will lose its hold on the market.