Building Green

More low-cost-housing groups are incorporating environmentally friendly practices into their work

Denny Park Apartments boasts a multitude of features designed to reduce the toll the new building takes on the environment — and save its residents money.

The apartment house, constructed by the nonprofit Low Income Housing Institute, in Seattle, was built to maximize the amount of natural light the 50 units receive, thus cutting down on electricity use. Sensors in the common areas turn off lights when a room is empty. The metal roof results in cleaner stormwater runoff, which is then channeled to planters on the deck. And low-emission paints and adhesives minimize indoor air pollution.

Beyond the environmental benefits, green building just makes sense for an organization committed to making housing affordable, says Sharon Lee, the charity’s executive director.

“It’s the only way to build,” she says. “Low-income residents can’t really afford to pay high energy costs.”

Drop in Price

While the price of building green was once out of reach for all but the most expensive homes and office buildings, the cost has dropped in recent years. As a result, more housing charities are incorporating environmentally friendly building practices into their work.

Like the Low Income Housing Institute, most are driven in large part by the desire to keep utility costs as low and consistent as possible for residents — a concern that has been underscored by the volatility of energy prices this year. Concern about the prevalence of asthma and other health problems in poor communities is also contributing to the shift in building practices.

National housing organizations — among them, Habitat for Humanity, the Local Initiatives Support Corporation, NeighborWorks America (formerly known as the Neighborhood Reinvestment Corporation), and YouthBuild USA — are providing training and advice on green building to local groups across the country. For example, the Housing Assistance Council, which supports rural housing groups, held a two-day conference in April on environmentally friendly building practices, which it plans to repeat in other regions of the country.

Perhaps most important, significant new sources of money are available. After taking nearly a year to reconsider its giving priorities, the Home Depot Foundation selected healthy, energy-efficient low-cost housing and the related topic of urban trees — which cut down on air pollution and whose shade can reduce the use of air conditioning. In 2005, the foundation awarded nearly $5-million to projects that promote and build green affordable housing. Grants and other assistance from utility companies and from state and local government programs also help finance the added expense of building green.

But the biggest push thus far has come from the Green Communities program, led by Enterprise Community Partners, in Columbia, Md.

In September 2004, Enterprise pledged to provide over the next five years $555-million in grants, loans, and equity financing to green affordable-housing projects, with a goal of creating 8,500 low-cost houses and apartments. In the first year of the program, Enterprise awarded $179-million to 77 developments that will create 4,300 units of low-cost housing.

Enlisting Experts

Enterprise worked with the Natural Resources Defense Council, in New York, to develop building standards for the program that would promote the greatest environmental benefits for the least additional cost.

“We want to make sure that we’re not trading affordability for aspects of green that don’t pay for themselves,” says Bart Harvey, chief executive officer of Enterprise Community Partners, which until recently was called the Enterprise Foundation.

He says that one of the key ways to keep costs down is to make sure that organizations are thinking about green features as they select locations and work with their architects to start the design process, rather than trying to add them to a finished plan.

To that end, the Green Communities program includes $5-million for grants of up to $50,000 each to plan and design green-housing projects and $50-million in low- interest loans to help housing groups acquire property and start construction.

The Green Communities program is also promoting policy changes that will encourage more developers of low-cost housing to go green.

The bulk of the program’s financing for green affordable housing — $500-million — is in the form of equity generated by low-income housing tax credits. The federal government allocates those tax credits to the states, which then award the tax credits competitively to housing developers — often nonprofit organizations — that are planning housing projects that will serve people who earn less than 60 percent of a metropolitan area’s median income.

Because nonprofit organizations pay little or nothing in taxes, the tax credits are not of value to them. But through the program, they essentially sell the credits to corporations, often large financial institutions, which buy them for the savings on their tax bills. The nonprofit organization, in turn, uses the proceeds of the sale to help pay for the low-cost housing project.

According to Mr. Harvey, 90 percent of the low-cost housing built in the United States is financed, at least in part, through the housing tax credits. Enterprise is encouraging the state housing agencies that award the tax credits to give bonus points to proposals that include green building features.

“The moment you do that, to be competitive everyone’s got to get up to the plate,” says Mr. Harvey. “So there’s a tremendous lever out there that is moving this from a one-off movement to a more mainstream movement.”

Cutting Spending

Nevertheless, the upfront cost of building green housing continues to be higher than conventional construction.

In 2005, New Ecology and the Tellus Institute, nonprofit organizations in Boston, studied 16 low-cost green housing projects, and found that green features added, on average, 2.4 percent to overall building costs. For the organizations in the study, that translated into as much as $9,700 more per unit of housing.

“It sounds like just a little bit of money,” says Edward F. Connelly, president of New Ecology. But, he says, putting together financing to build any kind of low-cost housing is already an arduous task. “So adding any costs is often a difficult thing.”

Two years ago, Hacienda Community Development Corporation, in Portland, Ore., was negotiating with a general contractor to build a planned development of 44 townhouses. The project was over budget, and when the organization started looking at ways to cut costs, the first items to go were the green elements.

“When you have a bare-bones budget, these seem to be an added feature,” says Pietro R. Ferrari, the group’s executive director. “If you can afford them, that’s great, but if there’s no money to include them, then your options are pretty limited.”

Fortunately, he says, with a grant from Enterprise’s Green Communities program and money from the state, Hacienda was able to “buy back” many of the environmentally friendly features the group thought it would have to eliminate.

Clara Vista Townhomes opened in February with an energy-efficient heating system, solar water heaters, and energy- and water- efficient appliances among its green amenities.

Utility Companies

Like Hacienda and other housing groups that are working to lessen the environmental impact of their construction, Rural Development, in Turners Falls, Mass., has sought grants from state and local programs that encourage energy efficiency to pay the extra costs.

Two local power companies, Western Massachusetts Electric Company and National Grid, for example, help pay the difference in cost between the way Rural Development had been building and what it needs to do to meet Energy Star Homes standards, set by the Environmental Protection Agency. The payment from the utility companies averages $3,600 to $3,800 for each of the roughly 1,200-square-foot homes the charity builds. Plus, they also provide materials, such as vents, compact fluorescent bulbs, and foam insulation for doors and windows.

And using money from the Massachusetts Technology Collaborative, a state agency that promotes renewable energy and economic development through technology, the organization has installed solar-electric systems in eight homes, and high-efficiency boilers and other technologies in four homes. The group estimates that the solar-electric systems save homeowners almost $500 annually on their energy bills.

When Rural Development is thinking about adding a green technique to its repertoire, the charity carefully weighs the cost of the new feature against the potential benefit to the homeowner and the environment, says Anne Perkins, director of home-ownership programs at the organization.

“We try to get the biggest bang,” she says.

Regional Differences

In addition to money, one of the challenges that Rural Development encountered was finding contractors who understood and cared about green building.

“If you have a sort of slap-dash crew, who doesn’t really believe in what you’re doing, but says, ‘Ah well, they say we have to do this, so we’ll do it, but if we don’t have time we won’t bother,’ then you compromise,” says Ms. Perkins.

Rural Development solved the problem by hiring a crew of carpenters and serving as its own contractor for the houses it builds, which is unusual for a housing group.

Located in New England, Rural Development is most concerned about building homes that will stay warm efficiently in the winter. In other parts of the country, priorities are different.

“Here in the South, the game of energy efficiency is how many hours or how many days can I keep the air conditioner off,” says Dick Pierce, senior director of programs at American YouthWorks, in Austin, Tex.

The organization runs Casa Verde Builders — which is part of the national YouthBuild network — where young people, largely from poor neighborhoods, build low-cost housing and pursue their high-school diploma or GED. Casa Verde is part of the AmeriCorps national service program, and participants who complete a year of service earn a $4,725 education award, which they can put toward college or a trade school.

Mr. Pierce says a home’s design and the way it is situated on a lot can go a long way toward keeping it cool during Austin’s hot summers.

Ideally, he says, the house should face the summer breeze and have a porch that also faces in that direction. A front door at the middle of the house that can be opened to catch the breeze, and a central hall or open floor plan that lets the breeze move through to another door or window at the back of the house, he says, can make a big difference.

The location of rooms and even appliances can also cut down on air-conditioning use. Bedrooms on corners of the house, for example, allow windows on two walls and a ceiling fan. Putting the washer and dryer outside in the carport keeps the heat the machines generate out of the main living space.

Casa Verde leaves as many trees on the lot as possible — unlike most builders who usually cut them down right away — and has even moved trees, because homes shaded by mature trees have substantially lower energy bills.

“You start to get the drift of all these little, sensible, common-sense things that you can do,” says Mr. Pierce. “When energy was so cheap, we just got away from thinking about them.”

Winning Support

When Habitat for Humanity-New York City starting incorporating green-building practices into its work, some staff members in the construction department went along “begrudgingly,” says Carey C. Shea, the organization’s chief operating officer. But, she says, after the organization was able to provide training to everyone in the department, the naysayers “found religion, and they’re the big advocates now.”

With time, the organization has learned that education is just as important for the families who purchase the homes and apartments it builds.

Habitat for Humanity-New York City uses low-emission glues and paints to minimize indoor air pollution, and has stopped using carpeting, which can collect dust mites, molds, and other irritants that can trigger attacks in people with asthma.

But, says Ms. Shea, before Habitat started providing training on the homes’ green features, homeowners didn’t know why the charity was making the choices it did.

“Folks were coming in and their daughters wanted a purple bedroom, and they’d buy the cheapest paint out there and put it up on the walls,” she says. “Or they would lay wall-to-wall carpeting on top of their hardwood floor.”

The organization is trying to build on its experience and think more broadly about environmentally friendly construction, says Ms. Shea. She points to a project in Brooklyn that was originally planned as townhouses, but has since been redesigned as three apartment buildings.

The denser development makes better use of the land, which is in short supply in New York, and she says that the units will probably be more energy efficient than the townhouses would have been. Plus, there will be more green space, a landscaped yard that the three buildings will share.

Ms. Shea believes that once people understand the benefits of green building, it becomes hard to ignore the approach.

“When you learn that this type of water heater will give you a 30-percent savings over that type, or this type of product is so much safer than that type of product,” she says, “it’s hard to pretend that you don’t know that and go back to doing it the old way.”