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Testimony Before the Council of the District of Columbia Green Building Practices Roundtable

Wednesday, March 18, 2009
George S. Hawkins, Esq., Director, DDOE

Good morning Chairperson Cheh and members of the Committee on Government Operations and the Environment. I am George Hawkins, Director of the District Department of the Environment (DDOE). Thank you for this opportunity to present testimony on green building practices in the District of Columbia. On behalf of DDOE, I would like to express our appreciation for your interest in green building and your leadership on environmental and energy matters. As I have stated before, it is my goal and our Mayor’s goal to make the District a national and international leader in sustainable urban practices.

The District as a Green Building Leader

In December 2006, this City Council took a momentous step and unanimously passed the Green Building Act of 2006. In addition to making the District a regional and national leader for green building requirements, the Act represented a coming together of government, advocates, and our building industry to recognize the importance of greening our built environment. The Green Building Act, with its forward thinking requirements for public and publicly financed buildings, and its “first of its kind” requirements for private sector buildings, sent a clear message that the built environment mattered in our efforts to protect the environment.

Since 2006, we have seen an awakening of interest in green building in the District and the for-profit and nonprofit private sectors, that have made the District the national leader in developing green and energy efficient buildings. With the tremendous leadership we’ve seen in the private sector, “going” green on major projects is now an accepted practice: across our city the decision now is not whether to pursue LEED certification, but at what level? There are numerous public or publicly-financed projects moving as well, with a new generation of libraries, schools, recreation centers, affordable housing projects and other District buildings under development—all GBA compliant with the LEED Silver or Green Communities standard, and many reaching for even higher levels of achievement.

The District can be proud that there are 427 registered green building projects in the city—more per capita than any other city in the United States. Additionally, we were recently recognized as the U.S. city with the 4th highest number of ENERGY STAR buildings—again making the District number one in the nation per capita.

DDOE

DDOE is committed to building upon the foundation laid by the Green Building Act. Under the Act, DDOE plays an important coordinating role, and provides technical assistance to District agencies and instrumentalities. DDOE chairs meetings of the Green Building Advisory Council, has issued the Act’s first green building regulations, actively supports sister agencies with green building coordination and technical assistance, and has integrated additional stormwater management, energy efficiency and renewable energy programs, and low impact development programs that are outside the scope of the Green Building Act, but are integral to creating a sustainable city effort. DDOE has taken many concrete steps to encourage and promote development of green, high performance buildings in the District, and to meet and wherever possible, exceed the requirements of the Act.

Legal and Regulatory

On September 21, 2007, the Mayor laid the regulatory groundwork for implementation of the Green Building Act through Mayor’s Order 2007-206, which gave specific regulatory guidance on the roles of individual agencies within the Administration. DDOE also promulgated regulations for school buildings, Green Building Act exemptions, and the expedited permitting review in 20 DCMR 3500, “Green Building Requirements”.
As required by the Green Building Act, and in support of DCRA’s efforts to green the building code “to the greatest extent practicable,” DDOE staff and consultants provided technical support and recommendations throughout the code review process. Many of these green code recommendations were incorporated, including the adoption of the latest water conservation requirements for fixtures, a requirement of a 30 percent improvement in residential energy efficiency, and adoption of the latest ASHRAE energy codes (90.1 2007). I should note here that the District is the first jurisdiction in the region to adopt the latest ASHRAE energy codes, and thereby has satisfied, well in advance of Congress’ requirements, a key prerequisite for some of the stimulus funding.

Finally, DDOE has provided considerable legal support to analyze problems arising under the current Green Building Act. I’ll discuss this analysis later on, but want to make the point that DDOE has dedicated considerable program and legal staff time to addressing issues that arise with regard to implementing the current enrolled version of the Green Building Act.

Green Building Advisory Council

One of DDOE’s key responsibilities under the Green Building Act is to chair the Green Building Advisory Council (GBAC). The GBAC includes six members appointed by the Mayor from the private and nonprofit sectors, one member appointed by the chairperson of the Committee on Public Services and Consumer Affairs, one member appointed by the chairperson of the Committee on Governments Operations and the Environment, and representatives from the Office of Planning, the Department of Real Estate Services, the Department of Consumer and Regulatory Affairs, and the Department of Housing and Community Development. Several of our GBAC members are here today.

DDOE works with the GBAC to identify issues and solutions to implementation challenges. To name just a few matters, the GBAC has focused on questions related to the application of the Act to publicly-financed residential and commercial projects, updating the relevant LEED and Green Communities standards, and potential technical corrections to the Green Building Act. We have also coordinated GBAC discussions on various “big idea” topics and emerging issues. When policies or ideas are drafted, GBAC members provide an important practical feedback.

Inter-agency Coordination

In its coordinating function, DDOE facilitates implementation of the Green Building Act in a number of ways to help its sister agencies meet their Green Building Act obligations. In the summer of 2008, DDOE established an ad hoc interagency working group for green building to discuss implementation challenges within the government and to “road test” proposed solutions. The group, which includes representatives of DDOE, DRES, DCRA, DHCD, DCHA, and DCHFA, addresses cross-agency implementation issues, and shares information and expertise.

In addition to supporting cross-agency coordination, DDOE staff work one-on-one with agency partners to provide technical assistance and training to support Green Building Act implementation. DDOE worked with DCRA and the consultant HOK to develop green permitting intake and expedited permitting processes. DDOE is actively working with DCRA to increase staff expertise on LEED, Green Communities, and energy performance standards, and the new 2008 green codes requirements. In January and February, DDOE staff conducted training and information sessions for approximately 50 DCRA staff.

Similarly, DDOE is working with OPEFM to support their LEED compliance mandate. DDOE funded development of green construction guidelines for OPEFM that are in final review at this time. Our staff continues to work with OPEFM project managers, as well as DCPS staff, to support greening of school buildings, schoolyards, and curriculum.

RESULTS

Thanks to the Green Building Act and the participation of key District agencies, the District’s public buildings—and those that are financed by the District—are going green. The Consolidated Forensics Lab, Woodson High School, the Galen Terrace affordable housing project, and Anacostia Library are all examples of public projects that are meeting and exceeding their LEED and Green Communities obligations. The CFL is going for LEED Gold, Woodson High School has LEED Gold in sight, and thanks to collaborative public funding, will sport a geothermal well field and be solar ready, a green roof and many stormwater best practices, and incorporate green systems to make the building a teaching tool. In accordance with Green Building Act ENERGY STAR requirements, Woodson’s energy performance was modeled with the ENERGY STAR Target Finder tool and will be benchmarked annually.

Currently, DRES is designing and building 670,000 square feet of LEED Silver or better facility space and is pursuing to renovate 60,000 square feet of current District-owned space to LEED standards. DHCD reports that their agency has ten green affordable housing projects under its wing, and DCHA and DCHFA together have a number of green affordable projects on the way.

The Skyland project in Ward 7 is a good example of the kinds of innovative thinking that is going into greening publicly-financed projects. This long-anticipated project is bringing together LEED Silver and Green Communities standards in an affordable, mixed-use project that will bring economic development to an underserved part of the city and environmental benefit to the District.

DDOE and DCRA are currently road-testing a green projects tracking matrix for green public and publicly-financed projects that are in the compliance pipeline to track where projects are in planning, permitting and inspections process. This matrix will also serve as an early warning system to make sure these projects are fulfilling all of their green requirements so that they will successfully achieve their appropriate certifications.

DCRA

Our sister agencies have also been making progress in their own right under the Green Building Act. DCRA has identified a green building coordinator and a green building plan reviewer, a number of their staff are LEED accredited, 50 of DCRA’s staff participated in training that introduced them to LEED, ENERGY STAR and Green Communities, as well as innovations the District has launched in green codes and stormwater management. DCRA has been our steady partner in learning to guide the green projects intake and inspections process, and the agency is addressing third-party aspects of green projects plan review, enforcement and expedited permitting.

In 2008 DCRA successfully adopted a set of groundbreaking green codes, incorporating a 30 percent improvement to energy performance for residential projects, progressive ASHRAE requirements for energy performance in commercial projects, green and reflective roofs to protect against the heat island effect, stormwater management requirements, water conservation codes standards for fixtures including elimination of the need for a special waiver for waterless urinals, and sub-metering for multi-family units.

DRES

DRES now has on staff several green building specialists, including a recycling coordinator, an energy manager, and three LEED accredited professionals that will significantly advance the agency’s green building efforts. In an innovative effort to go above and beyond the requirements of the Green Building Act, DRES created the District's first LEED Guidebook to assist project teams in aligning their entire design and construction process with the U.S. Green Building Council's LEED submission and certification process. This Guidebook is already being used to guide the construction of the Consolidated Forensic Lab and the Minnesota Benning Government Center, and other projects.

DRES is implementing a series of initiatives to promote and expand Green Building practices in the District which include compliance requirements as part of the scope of work for the architectural and engineering of new construction and major renovation projects. Additionally, DRES is pursuing LEED certification for six projects and has implemented the first transaction with a private developer to lease a LEED Silver certified building complex. DRES is exceeding the Green Building Act’s LEED Silver requirements and is pursuing LEED Gold certification, whenever possible.

With respect to energy conservation, DRES has conceptualized an educational campaign on energy conservation in the workplace and is “de-lamping” light bulbs in the Reeves Municipal Center to maximize energy efficiency and reduce light fixture costs by a third. Other efforts include an audit of the largest users of energy in District buildings and identifying improvements to improve deficiencies in the operation of the building and building equipment; ranking the District's facilities’ energy performance against commercial and industrial buildings throughout the country using the ENERGY STAR Portfolio Manager; and demonstrating the impact of improved Building Management Systems on major buildings in the District's portfolio.

Affordable Housing

DHCD has identified a green building point person whose half-time responsibility it is to guide the green aspects of affordable housing projects, and staff at the agency has undergone a series of trainings for Green Communities. Fortunately we have the resources of GreenHOME and Enterprise Partners who have been great partners in that process. I am very pleased that DHCD put green building requirements in its funding RFPs, which makes clear to all of their developers that green affordable housing is a requirement. In addition, DCHA has a number of significant green and energy efficient efforts, including the city’s first Energy Services Company (ESCO) program for improving the energy performance of its buildings, and several proactive staff are diligently working to turn the agency and its 18,000 units of housing green.

OPEFM

I am also very encouraged by the progress in the District to make our schools green. Despite the tight—or shall I say breakneck—pace at which OPEFM projects are moving, they have committed to LEED Silver for its projects. OPEFM has sent a dozen of its project managers to LEED for Schools technical training, and as a result a growing number of them are LEED accredited.

At least 7 OPEFM modernization projects are being designed and developed under LEED. For those whose scope of work is not significant enough for LEED, as many sustainability features as possible are being incorporated. The District’s one new construction project, HD Woodson SHS is reaching for LEED Gold.
OPEFM is also coordinating with DDOE for information on Low Impact Development and renewables grants. We are very excited at the prospect of taking this collaboration to the next step and incorporating green buildings into school curriculum by using green buildings as a tool to teach science and math, and by helping OPFEM develop green facilities management plan that incorporate green building management, energy tracking, site conservation methods, and recycling.

CHALLENGES

Greening the District of Columbia is an ongoing process and there have certainly been challenges. It takes time to build agency support for district-wide green building, to hire staff, to interpret laws and write regulations to implement the laws. One challenge that DDOE is working through now is the discovery of enrollment errors in the Green Building Act that inadvertently changed and confused the meaning of some sections of the Act. We have prepared a set of technical correction amendments to correct these errors, which are currently under internal review. We are also addressing the question of streamlining the process of updating the Green Building Act when new editions of either LEED or Green Communities are issued. My staff has been tracking a number of these policy and regulatory questions, and they’ve been regular topics of conversation at our Green Building Advisory Council meetings.

“Performance Bond” Requirement for Private Projects

I would now like to turn to the issue of performance bonds and criticism of this enforcement tool. Pursuant to the Act, commercial applicants will be required to submit a “performance bond.” If the building fails to meet the LEED certification requirements, “all or part of the performance bond shall be forfeited to the District.” Experts in the area of environmental finance analysis and DDOE’s research on the subject support this approach as an appropriate and sufficient enforcement mechanism to ensure compliance with the Act.

One of the concerns that has been raised is that “performance bonds” do not currently exist in the financial assurance world. There are, however, a number of laws and regulations that have required forms of financial assurance that at the time of the inception did not exist in the market. In each regulatory context, private financial markets have developed to provide the insurance, bonds, and other financial instruments necessary to demonstrate assurance. For example, before there were automobiles, there was no such thing as car insurance. When the law recognized a growing need to insure against harms that may be perpetrated by automobile drivers to others, the market rose to the demand.

The breadth of operations and environmental risks covered by current rules is an additional testament to the market’s ability to conform to and rise to the demand of a new form of financial assurance. For example, the Resource Conservation and Recovery Act (RCRA) requires that financial assurance be provided by the responsible party as proof that adequate funds will be available when needed to undertake the necessary corrective action at a RCRA treatment, storage, and disposal facility. Many states have their own laws requiring financial assurance, including our own DDOE requirement that developers post a bond equal to the cost of stormwater management infrastructure until DDOE verifies proper installation.

A second concern that has been raised is that it may prove difficult and financially burdensome for developers to provide letters of credit, collateral to obtain a bond, or escrow in amounts up to $3,000,000 (the maximum requirement under the Green Building Act). While opposition to new financial assurance rules is common regardless of industry, DDOE believes fears of business disruption from this new assurance requirement are unwarranted. When the District began to require condominium developers to place 10 percent of the cost of construction in an escrow account or provide a letter of credit under the Condominium Act, the same concerns were cited, and yet, this is now common practice.

An additional criticism of the current “performance bond” requirement is that the enforcement mechanism creates an inherent conflict of interest because those that would require forfeiture of the bonds would also directly benefit from the forfeiture. If forfeited, performance bond funds are to be “deposited in the Green Building Fund.” Under the Act, the Green Building Fund is to be used, in part, for “staffing and operating costs to provide technical assistance, plan review, and inspections and monitoring of green buildings.” On the contrary, it is important to note that many legally-required fees, fines, and penalties are used by governments to fund the operation of the program under which they are collected. For example, D.C. Official Code § 7-632 authorizes the establishment of a Regulatory Enforcement Fund to be used by DDOE to finance its regulatory practice. The Council has routinely authorized use of enforcement proceeds to finance future enforcement actions.

In summary, we believe the bond requirement under the Green Building Act is viable and can be implemented. We have already, and will continue to, participate in discussions with our sister agencies and stakeholders as to how this enforcement mechanism should best be implemented.

Green Jobs and Green Buildings

We can’t have a conversation about green building without acknowledgment of the connection to green jobs development. Green building is one of the primary engines for growth of green jobs in the District. From green construction, to LEED design and consulting, to green roofs installation, to solar panels and geothermal technology development, to building energy audit services and weatherization, green buildings, can be significant drivers of a green economy. My agency is working with partners at DOES, Planning and DSLBD to broaden the opportunities for the District’s young people and our residents in general in the green building sector. We look forward to working with you to develop supportive policies that will make this happen.

The Clean and Affordable Energy Act of 2008

DDOE also recognizes the important role that the Clean and Affordable Energy Act of 2008 (CAEA) will play in greening our built environment. The creation of the Sustainable Energy Utility, implementation of the renewable portfolio standard, and reporting of building energy performance will drive improved building performance for years to come. To that end, we are actively pursuing the deadlines laid out in the CAEA.

To review our status quickly, as of December 31, 2008, DDOE established the SEU brand known as Green Energy DC and have posted a new website at www.greenenergy.dc.gov. The Sustainable Energy Trust Fund and the Energy Assistance Trust Fund and their associated assessments on the electric and natural gas companies are in place. DDOE is coordinating efforts with an experienced consultant to prepare the draft RFP for the SEU contract administrator. We have prepared draft bylaws and are developing performance benchmarks to be presented to the SEU Advisory Board for consideration.

DDOE has ensured that an Evaluation, Measurement and Verification system with consistent protocols will be in place to assess SEU performance, in part through participation in the North-East Energy Efficiency Partnerships E, M & V Forum. DDOE is on schedule with the timelines set forth in the CAEA legislation for the SEU to become functional.

Finally, DDOE has also implemented the shift to the Renewable Energy Incentive Program, which is now open for applications and is already very popular.

Stimulus Funding

Before closing, I’d like to provide an update on the important role stimulus funding in the American Recovery and Reinvestment Act of 2009 (ARRA) will play in our efforts to green the District. The Administration is working as we speak to ensure that the District secures all eligible funding and allocates that funding in a smart and effective way. While final allocation decisions have not been made, it is clear that funds from the Weatherization Assistance Program (over $8M), the State Energy Program (over $22M) and the Energy Efficiency Conservation Block Grants (amount TBD) and other sources will be directed to green our District building portfolio.

As you know, this past Saturday DDOE and the City Administrator’s office met with 14 agencies that presented proposals to green our schools, firehouses, shelters, and other retrofit and new construction projects. Funding will also be used to support green building trades’ education and training and other workforce development goals to help build our green economy. As we proceed, our proposal and commitments will be available on recovery.dc.gov, and as we discussed at least week’s hearing, we will seek input from the Council and public as we finalize priorities.

I thank you again for the opportunity to testify, and look forward to answering any questions the Committee may have.