Fayetteville, Arkansas, LEED-Certification, and Energy Efficient Municipal Buildings

According to the USGBC, “LEED initiatives including legislation, executive orders, resolutions, ordinances, policies, and incentives” are found in 384 cities and towns and 58 counties across 45 states. 

One of those initiatives – and, at least according to the USGBC’s online database, the only municipal initiative in Arkansas – is City of Fayetteville Resolution 176-07.

Entitled, “A Resolution Establishing An Energy Efficient Building Policy for the City of Fayetteville,” Resolution 176-07 passed on October 2, 2007.  It provides, in its entirety:

Section 1:  That the City Council of the City of Fayetteville, Arkansas hereby requires all new, city-owned buildings in excess of 5,000 square feet to achieve a minimum certification of LEED-Silver as issued by the US Green Building Council provided a favorable cost-benefit analysis is provided by a private architect or engineer and require all exempt building designs to include a LEED checklist with an emphasis on energy and water efficiency.

Resolution 176-07 does not carry the force of law.  It is best considered a statement of public policy.  Unfortunately, as a statement of public policy, particularly one with a national profile, Resolution 176-07 is undermined by a significant ambiguity: what, exactly, is a “favorable cost-benefit analysis”?  Indeed, what if even though the cost of building to the LEED-Silver status is not disproportionately more expensive than building to a conventional standard, the architect or engineer in question concludes that the cost-benefit analysis is unfavorable because the proposed project will not result greater energy efficiency?

The incorporation of LEED standards into land use law has generated significant and spirited debate, and one of the frequent debate points is that the empirical data does not indicate that LEED-certified buildings are, in fact, better performing buildings.  Henry Gifford asserted this very point – that the USGBC promoted LEED as resulting in more energy efficient buildings even though a study commissioned by the USGBC indicated that this was not the case – in his now dismissed lawsuit, Gifford v. USGBC.  Similarly, the authors of the 2009 National Institution of Building Science Report on Building Rating and Certification in the U.S. Building Community observed, “[t]here is very limited data that correlates verifiable improvements in building performance with building rating/certification system requirements.  Many people view the few data sets that do exist as controversial in terms of methodologies and conclusions drawn from them.”  The study concludes that “[t]here are growing concerns that the implied guarantee of building energy performance emanating from the building rating/certification/labeling systems may confuse or mislead policy makers and the public.”

Thus, Resolution 176-07 runs the risk of failing to achieve the very cause it advances.  One way to improve Resolution 176-07 would be to add a provision requiring the collection and analysis of data from new municipal buildings built to the LEED-Silver certification standard.  This, it would seem, encourages not only the energy-efficiency conscious green building practices embodied in the Resolution, but also results in the creation of green jobs.   

LEEDigation Update: Gifford v. USGBC Dismissed

In October 2010, energy efficiency consultant Henry Gifford filed a salacious and potentially ground-breaking lawsuit challenging the U.S. Green Building Council’s LEED certification system. Gifford made a number of interesting (and, as it turns out, legally insignificant) claims against the USGBC, but the essence of Gifford’s complaint was this: he contended that the USGBC promoted LEED as resulting in more energy efficient buildings; that, as a result, consumers favored LEED-accredited professionals over non-LEED accredited professionals; that the USGBC’s claims connecting LEED certification with increased energy efficiency were, in fact, untrue; and, as a result, energy efficiency consultants like Gifford who refused to “drink the Kool Aid” were being damaged and driven out of business.

Well, gadfly Gifford has been vanquished. In a nine-page opinion issued on August 15, 2011, the federal district court for the southern district of New York dismissed Gifford’s complaint in its entirety.

Given the aura of anticipation that surrounded this case and the occasional venom that pierced through the cold hard paper record (yes, the USGBC really did refer to Gifford as a “gadfly” in one of its filings), not to mention the fact that Gifford is one of those people who seems to have the uncanny ability to provoke strong feelings, even from those who do not know him, I suspect many will find the opinion both surprisingly bland and generally unintelligible.

So here, in a nutshell, is why Gifford’s complaint failed:

As I’ve discussed in previous posts, a basic concept of any lawsuit is the idea of “standing.” This means, quite literally, that the person or entity bringing the suit is the right person or entity to bring the suit. Generally, a plaintiff must identify two basic things: first, that he or she has suffered an injury that is discrete, real, and compensable by the payment of money; and, second, that there is a legally relevant connection between that injury and something that the defendant allegedly did.

Gifford brought his claims under the federal Lanham Act, which generally prohibits the false representation of goods or services in interstate commerce. The Gifford court recognized two ways of showing standing for a Lanham Act claim: either the plaintiff and the defendant are competitors, or the plaintiffs must allege a “reasonable commercial interest” that is likely to be damaged by the defendant’s alleged false statements.

Gifford failed to clear the basic hurdle of standing. Gifford and the USGBC are not competitors. The court found that the USGBC, through the LEED certification system, provides third-party verification that structures have been designed and built in a way that should make them more energy efficient. Gifford, in contrast, held himself out as an energy efficient building expert. Since the USGBC expressly disclaimed any energy efficiency expertise, and the since Gifford did not content he was in the certification business, the federal court found that they were not competitors.

Likewise, “Because there is no requirement that a builder hire LEED-accredited professionals at any level, let alone every level, to attain LEED certification it is not plausible that each customer who opts for LEED certification is a customer lost to Plaintiffs.” In other words, the fact that a building owner might aspire to LEED-certification does not mean that Gifford cannot work on the project.

I do not know Henry Gifford, or any of the other plaintiffs in the Gifford v. USGBC suit, and I have no desire to pass judgment on him or them. Gifford may have valid, meritorious complaints about the LEED system. Just as LEED seems to be creating jobs in some areas, it may well be the cause of the demise of others. And it seems likely that some consumers will indeed feel that through LEED the USGBC has promised exactly that which Gifford says LEED does not and cannot deliver: a building that is more energy efficient than one that is not LEED-certified. Indeed, the most recent appropriations bill for the U.S. Department of Defense charged the DOD with studying this very point.

The simple fact is that Gifford alleged that the USGBC was a major player in the sustainasphere, and that he believed that was having an adverse affect on him and people like him. But what Gifford could not allege is that the USGBC was actually doing something – anything – wrong. And a fancy way of saying that is, “case dismissed for lack of standing.”

Will Congress Ban LEED Gold and Platinum Certification for the Department of Defense?

The National Defense Authorization Act for Fiscal Year 2012, otherwise known as House Bill 1540, is a thousand page window into the manner in which military activities, personnel, construction, and operations will be funded in 2012.  And buried deep within that mess, on page 788, is Section 2831: “Report on Energy-Efficiency Standards and Prohibition on Use of Funds for Leadership in Energy and Environmental Design Gold or Platinum Certification.” 

Section 2831 is a proverbial double-edged sword.  On the one hand, if included in the final Department of Defense appropriations bill, the DOD would be required to analyze and report on the costs and benefits of adopting ASHRAE Standard 189.1: Standard for the Design of High-Performance Green Buildings Except Low-Rise Residential Buildings versus adopting ASHRAE Standard 90.1: Energy Standard for Buildings Except Low-Rise Residential Buildings for the sustainable design, development, construction, and renovation of DOD buildings and structures.  The report must include details of the energy-efficiency improvements achieved and long term payback (whatever that means) resulting from the adoption of ASHRAE Standard 189.1, and a cost benefit-analysis and return on investment for energy-efficiency attributes and sustainable design achieved through LEED gold or platinum certification.

On the other hand, Section 2831 clearly and unequivocally prohibits the use of DOD funds “for achieving any LEED gold or platinum certification.”  This does not mean that DOD buildings cannot be certified LEED gold or platinum certification, but it does mean the cost of obtaining gold or platinum certification cannot exceed the cost of obtaining LEED Silver or Certified certification.

From an empirical viewpoint, this is a sound framework for evaluating the expenditures associated with LEED-certification: audit existing certified buildings and identify any causal connections between certification and energy efficiency before devoting further funding to certification.

There is also a paucity of independent study in the actual effects and benefits of LEED certification.  As the now infamous Gifford v. USGBC lawsuit illustrates, there is a genuine debate as to whether LEED-certification results in buildings that are more energy efficient.  The DOD has a decent stock of certified buildings.  An empirical study of these buildings will help to bridge this information gap.

But the funding ban also appears somewhat arbitrary.  True, there is undoubtedly some additional cost associated with Gold or Platinum LEED certification over and above Silver or Certified certification, but, in the bigger picture, does this incremental savings really justify an outright ban?  And, at the risk of engaging in some proverbial nose-cutting for the sake of face spiting, what is the basis for drawing the line at Silver and Certified certification?  After, all, if the funding decision turns on whether LEED certification results in more energy efficient buildings, why study buildings at all levels of certification?

The ban also ignores that LEED certification serves purposes beyond achieving energy efficiency.  Per the USGBC, the LEED certification program is intended to provide a benchmark for evaluating whole buildings and to be a "definitive standard for what constitutes a green building in design, construction, and operation."  In the bigger picture, this implicates the triple bottom line of social, economic, and environmental responsibility, and that means far more than just energy efficiency.  The certification process also means that the government gets third-party confirmation that the "green" building it ordered is the "green" building that was delivered.

The effect of this ban on Arkansas remains to be seen.  There are DOD projects and properties in Arkansas, and some are well known for sustainable initiative (the Air Force Base in Jacksonville, Arkansas, comes to mind).  There is always the possibility that local municipalities will follow the federal example, and that would have widespread effects in cities like Little Rock, where all new municipal buildings must be LEED certified.

In the end, the folks at ASHRE report that the Senate is in the process of drafting its own funding bill.  This bill will undoubtedly be different from the House bill.  Whether there is agreement on the DOD LEED funding ban (or anything else, for that matter), remains to be seen.