E N V I R O N M E N T A L L A W I N S T I T U T E

MUNICIPAL GREEN BUILDING POLICIES

April 2008

Strategies for Transforming Building

Practices in the Private Sector

MUNICIPAL GREEN BUILDING POLICIES

Strategies for Transforming Building Practices in the Private Sector

APRIL 2008

©Environmental Law Institute

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ACKNOWLEDGMENTS

Funding for this report was provided by the U.S. Environmental Protection Agency under AssistanceAgreement Number XA-83311001-0. The contents of the report are the responsibility of the EnvironmentalLaw Institute. The views expressed herein should not be attributed to EPA, nor should any official endorse-ment be inferred.

ELI gratefully acknowledges the assistance of numerous individuals who gave generously of their time to pro-vide information about the policy initiatives discussed in this report and to review drafts of the report.

About ELI Publications

ELI publishes Research Reports that present the analysis and conclusions of the policy studies ELI undertakesto improve environmental law and policy. In addition, ELI publishes several periodicals—including theEnvironmental Law Reporter®, The Environmental Forum®, and the National Wetlands Newsletter—and books,which contribute to education of the profession and disseminate diverse points of view and opinions to stim-ulate a robust and creative exchange of ideas. Those publications, which express opinions of the authors andnot necessarily those of the Institute, its Board of Directors, or funding organizations, exemplify ELI’s commit-ment to dialogue with all sectors. ELI welcomes suggestions for article and book topics and encourages the sub-mission of draft manuscripts and book proposals.

Municipal Green Building Policies: Strategies for Transforming Building Practices in the Private Sector

Copyright © 2008 Environmental Law Institute®, Washington, D.C. All rights reserved.ISBN 978-1-58576-145-6 ELI Project No. 062103

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Executive Summary v

Chapter OneIntroduction 1

Chapter TwoPolicies that Establish Green Building Requirements 4

Chapter ThreePolicies that Provide Expedited Review for Green Building Projects 16

Chapter FourPolicies that Provide Direct Financial Incentives for Green Building Projects: 24Grants, Fee Waivers, Tax Breaks and Bonus Development

Appendices: Policy Summaries 29Appendix A: Mandatory Policies

Arlington County, VA Aspen/Pitkin County, COAustin, TX Boston, MABoulder, CO Calabasas, CAFrisco, TX Long Beach, CAMarin County, CA Montgomery County, MDPasadena, CA Pleasanton, CASanta Cruz, CA Washington, D.C

Appendix B: Expedited Review PoliciesAnaheim, CA Arlington County, VAChicago, IL King County, WASan Francisco, CA Santa Cruz, CASanta Monica, CA Sarasota County, FLScottsdale, AZ Washington, DC

Appendix C: Financial Incentive PoliciesBaltimore County, MD Chatham County, GACincinnati, OH Arlington County, VASeattle, WA

CONTENTS

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Over the past several years, cities and countiesthroughout the United States have played an

important role in advancing sustainable buildingpractices. Municipalities are helping to create build-ings that are healthier and more environmentally andeconomically sustainable, both through their leader-ship in public building projects and through their ini-tiatives to transform private-sector building activities.

This report reviews over 25 different municipalpolicies that promote green building in the privatesector by (1) mandating green building practices, (2)providing expedited review of green building proj-ects, or (3) providing other direct financial incentivesfor green building projects. Although many of themunicipalities included in the report are inCalifornia, all regions of the country are represented.While most jurisdictions are medium or large inpopulation, the report also includes several smallercities and counties.

A key to developing an effective green buildingpolicy is aligning the elements of the policy with thepolitical, economic, and institutional circumstancesof the municipality. Some jurisdictions have chosento focus their policies on smaller residential develop-ment. Others have identified greater opportunitiesfor change in the commercial sector, which mightinclude office buildings and large multi-familybuildings, as well as mixed-use and industrial proj-ects. Some municipalities have begun with a modestincentive program, and others have started out witha more far-reaching set of requirements or incen-tives. A number of the policies have evolved over thepast few years, with municipalities raising their greenbuilding standards and strengthening the implemen-tation of those standards.

The experiences of cities and counties to date,including those discussed in this report, reflect dif-ferent approaches to bringing about sustainablebuilding practices and offer varied models for othersto consider.

Type of Policy Strategy

Establish green building requirements. About halfof the municipalities included in the report requirecertain private-sector building projects to meet aminimum green building standard established by thepolicy. In general, policy makers and program offi-cials in these jurisdictions felt strongly that a manda-tory policy, rather than incentives, would be mosteffective at changing building practices. Some of thejurisdictions began with phase-in periods, and somestarted out with more modest green building stan-dards and have increased those standards recently.For the most part, though, these mandatory policiesdid not evolve from voluntary, incentive-based poli-cies.

Provide expedited review for green buildingprojects. Expedited review is a widely-used incen-tive, with 10 of the jurisdictions included here offer-ing this as a central component of their green build-ing policies. Whether expedited review can be aneffective incentive depends heavily on the structureand timing of the municipality’s existing buildingreview process and the availability of staff resourcesto ensure significantly faster review for qualifiedprojects. In general, commercial and large residentialprojects, which typically undergo a more complexand lengthier review, may offer an opportunity forthe largest reductions in processing time. Yet even a

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modest reduction can be a significant incentivewhen the turn-around time is certain. Municipalitiescan also provide green building projects with a high-er level of municipal assistance and coordinationthroughout the review process, in conjunction withfaster processing.

Offer direct financial incentives. The 12 policiesincluded in the report that provide some type ofdirect financial incentive differ considerably in thenature and scope of the incentive. All of the taxincentives and the bonus development policies standon their own. The policies providing grants or feewaivers are either combined with other incentivessuch as expedited review, or are offered to encourageprojects to go beyond any mandatory minimumgreen building requirements established by the poli-cy. Grants, tax breaks, and building fee waivers pro-vide the most straightforward benefit to projects,and their use depends largely on the financialresources and programs available to the municipali-ty. Bonus development can also provide a significantfinancial benefit to private-sector projects in jurisdic-tions that are able to integrate the incentive withintheir existing planning and zoning requirements andprocesses.

Green Building Criteria

Whether a policy is mandatory or incentive-based,substantive green building criteria form the core ele-ment of the policy. The design and scope of the cri-teria vary depending on a variety of factors, includ-ing existing municipal building requirements, envi-ronmental and public health priorities within themunicipality, and community experience with andsupport for green building initiatives. It is importantfor policy makers to consider certain structural issueswhen establishing their green building criteria.

Incorporate third-party systems. The majority ofpolicies discussed here incorporate the criteria ofthird-party green building rating systems. These flex-ible, point-based systems reduce the burden on pol-icy makers to create their own green building crite-

ria. They also provide criteria that have been testedand that may already be familiar to the local build-ing industry. The criteria developed for the U.S.Green Building Council’s LEED rating system arereferenced by a large majority of the municipal poli-cies described here, generally for commercial andlarge, multi-family projects. Several municipalitiesincorporate the criteria of regional, third-party rat-ing systems, such as those based in California,Florida and Washington. When using third-partysystems, municipalities must determine which of thegreen building rating levels (or tiers) used in thosesystems will apply to projects covered by the policy.

Address local priorities. Although third-party sys-tems are a considerable resource to policy makers,they may not adequately reflect local environmentalpriorities. Similarly, their point-based flexibility isboth an advantage and a disadvantage, as policymakers cannot ensure that their priority green build-ing measures, even if incorporated into the ratingsystem as options, will be selected by builders.

Some municipalities that use third-party criteriahave taken steps to address local environmental pri-orities. It is difficult to alter third-party frameworks,particularly if the municipality requires or encour-ages formal certification by the third-party organiza-tion. One alternate approach is to establish greenbuilding measures that are apart from and supple-ment the third-party systems. The municipalitywould then be responsible for ensuring compliancewith those additional measures. Municipal greenbuilding policies could also establish as prerequisitescertain measures that are listed as optional in thethird-party system.

Rather than integrate third-party rating systems,several of the mandatory and expedited review poli-cies discussed here address local priorities by estab-lishing their own criteria, which mainly take theform of flexible, point-based systems. These policiesemphasize building practices relating to energy,water, and waste, as well as indoor environmentalquality. Jurisdictions that maintain their own criteriacan also integrate existing third-party guidance, such

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as EPA’s Energy Star program, or the agency’s newEnergy Star/Indoor Air Package guidance. (Seehttp://www.energystar.gov/index.cfm?c=bldrs_lenders_raters.nh_iap.)

In addition to adopting third-party green build-ing criteria or creating their own rating system,municipalities can revise the local building (or relat-ed) codes to require certain specific green buildingmeasures. Most, if not all, jurisdictions already havesome code provisions in areas such as energy efficien-cy, storm water management, combustion safety, etc.It is thus important for local policy makers to (1)consider the extent to which existing municipalbuilding requirements already establish green build-ing measures, (2) identify priority green buildingmeasures that are not yet incorporated into munici-pal policy, and (3) ensure that these priorities areaddressed when establishing minimum green build-ing requirements or incentives.

Compliance and Enforcement

Regardless of the minimum green building standardcreated, it is vital for a mandatory or incentive-basedgreen building policy to create effective mechanismsfor documenting and verifying compliance.Municipal oversight will help ensure that greenbuilding features are not eliminated as projects pro-ceed through design and construction and will alsohelp the municipality track and demonstrate greenbuilding results. Policy makers should considerestablishing detailed provisions that specify the typeof green building documentation to be submitted,the timing of submissions, and the process formunicipal review of the documentation.

Incorporate third-party certification. Oneapproach to ensuring compliance with third-partyrating systems is to require certification by the third-party rating organization. Nearly all mandatory poli-cies that use the LEED criteria have stopped short ofrequiring formal LEED certification, as they arereluctant to delegate oversight to a third-partyorganization, to complicate the timing of building

approvals, and to require projects to pay third-partycertification fees.

By contrast, voluntary, incentive-based programstypically do require formal certification. Where poli-cies provide financial incentives following third-partycertification (such as grants or tax credits), themunicipality’s oversight burden is reduced dramati-cally. For programs that provide incentives earlier inthe process (expedited review, bonus development,fee waivers), the municipality must make an initialeligibility determination based on whether a projecthas documented that it will likely achieve the appro-priate green building certification. This could beaccomplished by requiring LEED registration or byhaving projects submit green building checklistsand/or narratives.

Determine the scope of municipal oversight.Mandatory policies, which generally do not requirethird-party certification, must integrate and coordi-nate green building oversight with the existing build-ing approval and permitting processes. Most pro-grams have relied heavily on up-front design review,rather than establishing detailed procedures for veri-fying green building measures during the construc-tion phase. However, some long-standing programshave begun to place a greater emphasis on using thecity inspection process, as well as third-party raters,to verify compliance during construction. Thesechanges reflect a desire to both ensure complianceand to more fully document the results of the greenbuilding program. Policy makers should considerresource needs, as well as the need for inter-agencycoordination (especially if the policy has been devel-oped or managed by the permitting and inspectionagency) when developing an effective approach tomunicipal oversight.

Ensure adequate municipal staffing to overseecompliance. A majority of the mandatory and expe-dited review programs described here have special-ized staff members who take primary responsibilityfor overseeing implementation of the green buildingpolicy, including review and approval of green build-ing documentation. Municipalities have taken a vari-

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executive summary

ety of approaches to staffing, including: (1) changingthe job responsibilities of existing staff, (2) hiringnew staff, (3) using staff from the city’s pre-existinggreen building program, (4) hiring green buildingconsultants to supplement agency staff, and (5)requiring project applicants to hire their own greenbuilding professionals in order to help ensure thequality of the project’s green building documenta-tion and thereby reduce the burden on municipalstaff.

Establish enforcement mechanisms. Enforce-ment has not been a significant focus of the programsdescribed in the report. Nevertheless, the policiesadopted by these municipalities incorporate examplesof enforcement measures that should be consideredwhen developing a mandatory or incentive-basedpolicy, including: (1) withholding of final occupancycertificates (or comparable approvals) until projectscomply with green building requirements, (2)authorizing agencies to require substitution of alter-native green building measures if features included inproject are not met during construction, (3) estab-lishing monetary penalties, and (4) requiring a bondthat is forfeited if projects do not comply with greenbuilding requirements.

Resources for Implementation

Providing adequate resources for implementation iscritical to the success of any policy, and it is impor-tant for policy makers to identify these costs at theoutset and to plan accordingly. Steps to address thesecosts include establishing/increasing building feesand allocating funds for specific, anticipated costs.Although resource needs will vary with the size andstructure of the municipality, as well as the scope ofthe policy, the financial impact of certain key pro-gram components should be anticipated when devel-oping the policy.

Identify staffing resources. As noted above, staffresources are needed to oversee compliance by review-ing green building documentation and conductinginspections. Staff members are also needed to pro-

vide public outreach and education. Many programsemphasize the importance of conducting extensiveoutreach in order to involve stakeholders in develop-ment of the policy and to increase communityawareness and understanding of the policy. In orderto ensure adequate staffing, some programs haveused existing budgets to hire new staff or consult-ants, while others have shifted existing staff respon-sibilities.

Provide resources for staff training. Most greenbuilding program officials agree that training formunicipal staff is critical to effective policy imple-mentation. Some jurisdictions have used revenuefrom new building fees to conduct training, and oth-ers have coordinated training through existingmunicipal green building programs.

Provide resources for monetary incentives.Green building grants are the clearest example ofpolicy strategies that require designation of specificfunding sources. Tax breaks and fee rebates requirecareful budget planning and integration with exist-ing municipal programs in order to identify theappropriate amount and duration of the incentive.

Program Evaluation

While many municipalities have evaluated their pro-grams informally, the jurisdictions discussed heregenerally have not carried out formal evaluationactivities, citing a lack of dedicated resources as thechief obstacle. Most green building officialsacknowledge, however, that program evaluation is akey area for future green building policy develop-ment to help ensure that municipal resources arebeing used effectively to achieve environmental andpublic health goals.

Re-evaluate and update the green building poli-cy and program. An important element of a greenbuilding policy is to plan for review of the policyitself within a few years—e.g., three-five years afterenactment. The review process can include: discus-sions with the building community and other stake-

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holders; an evaluation of compliance and/or partici-pation levels; and a determination of whether greenbuilding criteria should be adjusted. A number ofjurisdictions have revised and raised their minimumgreen building criteria after a period of time, as expe-rience with the policy increases and the municipali-ty strengthens its broader environmental and publichealth goals.

Evaluate projects built under the policy. Withlimited exception, the municipalities discussed herehave not sought systematically to collect and analyzeinformation about buildings constructed under thepolicies. As programs mature, this is an importantarea for policy development.

As a beginning step, municipal agencies can col-lect information about which types of green buildingfeatures are being included in new projects. Mostpolicies require submission of checklists or score-cards that list the green building measures includedin the project. Many jurisdictions are already collect-ing this information electronically, but lack theresources to manage and analyze the data compre-hensively. Third-party green building rating organi-zations may be able to help provide municipalitieswith this type of information for certain projects.

A more significant step would be to collect infor-mation about building performance following con-struction. This can be done by identifying the “typi-cal” building constructed under the municipal greenbuilding standards and estimating savings in areassuch as energy and water. Municipalities can alsorequire projects to submit modeling or calculationsand use this data to analyze environmental results ofthe program. A more far-reaching step would be forpolicy makers to authorize program officials torequire projects to submit information about actualbuilding performance, and for programs to collectand analyze this information.

Another related issue which has yet to beaddressed directly by the policies discussed here isthe establishment of requirements for building oper-ation and management. Proper operation and main-tenance of green buildings is critical to ensure thatthe benefits of green building design and construc-tion are fully realized. As third-party rating systemsand other tools for measuring green building opera-tions become more widely used, future green build-ing policies can begin to look beyond design andconstruction to the sustainable management ofgreen buildings.

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http://www.arlingtonva.us/

http://www.ci/

http://www.builditgreen.org/

http://egov.cityofchicago.org/DCAP

http://www.floridagreenbuilding.org

http://www.scottsdaleaz.gov/greenbuilding/