NYC's Affordable Housing Developers May Face Renewed Battle Over Green Building Mandate

2007

Mar

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An interesting item appeared in this week’s print edition of Crain’s New York Business. The New York City Department of Housing Preservation and Development (“HPD”) is apparently considering the use of the Enterprise Community Partners' Green Communities rating system in connection with affordable housing development here in New York. Crain’s reports that HPD Commissioner Shaun Donovan is exploring the possibility of adopting Green Communities as the standard for all HPD housing projects.

Crain's doesn't provide much detail, but this news is intriguing for several reasons. First, as I’ve posted here before, there was serious resistance from New York’s affordable housing developers to Local Law 86, which was largely driven by LEED certification costs. As originally proposed, the law was also to apply to affordable housing development, but a group, including 228 East Third Street developer Mary Spink, successfully fought to remain outside of the legislation’s purview. Is Donovan responding to the concerns of Spink and others by proposing a different rating system that’s tailored for this niche construction sector? Or should Spink and other NYC affordable housing developers steel themselves for another fight against government-mandated green legislation?

With respect to this latter thought, USGBC and Enterprise Community Partners announced a partnership at Greenbuild 2006, pledging to “[align] Green Communities and LEED for Homes and . . . [cut costs] of certification and verification.” In its current form, Green Communities offers 141 possible points across similar credit categories as LEED (Location and Neighborhood Design Fabric, Site Improvements, Energy Efficiency, etc.). New construction must satisfy 25 points in order to qualify for a variety of grants, loans, tax credit equity, and training programs. The standard is part of a $550 million, 5 year initiative that includes Enterprise, NRDC, the AIA, and a number of corporate and financial institutions.

It's unclear at this very early stage how the Green Communities standard would be implemented and enforced by HPD, but it could be a concern for New York's affordable housing development community. The standard could present similar implications for the industry as Local Law 86 might have if the USGBC/Enterprise Community Partners partnership ends up more extensively harmonizing Green Communities with LEED. Regardless, I’d be very curious to hear some industry reaction to this report in Crain’s, and I'll be keeping tabs on HPD should the plan move forward.