Nine years ago the Virginia Housing Development Authority (VHDA), Virginia’s housing finance agency, became concerned about the construction quality, attractiveness, and durability of the state’s tax credit developments. Seeing in emerging green building practices the kind of longevity and quality they were looking for, VHDA began awarding points for adopting green building standards as part of the state’s competition for Low Income Housing Tax Credits.
Initially, points were awarded for including such items as high efficiency heat pumps and Energy Star¨ windows and appliances. In 2006, VHDA ratcheted up the process and began to stipulate tax credit projects had to be green-certified by EarthCraft Virginia, a third-party, nonprofit organization.
The incentives have worked. “Affordable housing developers are going full speed ahead bringing green building to scale all over Virginia,” says Jessica Abralind, Arlington County green building specialist.
Philip Agee, green building technical manager for EarthCraft Virginia, agrees. “By incentivizing green building, VHDA has really revolutionized multifamily housing, especially affordable projects, in Virginia.”
Good Economic Sense
Sustainable building makes sense for the affordable housing industry. “We plan to own and operate our affordable communities for years to come,” says Walter D. Webdale, president and CEO of AHC Inc., a nonprofit affordable housing developer based in Arlington, Va. “Investing in green building not only pays off for us by reducing operating costs, but it also provides more healthy living environments for our residents and helps reduce their expenses as well. Plus, building green helps us be good neighbors and community leaders.”
AHC Inc. is not alone. Of the 75 multifamily projects EarthCraft has under construction, 68 are affordable. “It makes sense that affordable housing developers, who plan to own their project for a long time, are interested in durability and investing more upfront in design and construction costs to save more over the long term,” says Agee. “Durability and maintenance costs — a lot of those decisions are being guided by green building. The affordable housing industry was tuned into this before many market-rate developers.”
Still, affordable housing developers have to take a pragmatic approach to adding green features. “We are very sensitive to the costs of our projects,” says Curtis Adams, AHC project manager. “We pick and choose what green features are prudent for the project. Everyone wants to build green; it’s just a matter of what we can buy with our dollar.”
Carefully used, that dollar goes a long way though. AHC has found that the cost of creating its EarthCraft-certified buildings has generally only accounted for about a 2 to 3 percent increase in upfront construction costs; Earthcraft notes that a recent market rate-development it certified only increased its costs by 1.7 percent to qualify. Some other certification programs, such as the U.S. Green Building Council’s LEED Gold or above, can be much more expensive. “It’s a balancing act,” says Adams. “AHC, like the entire industry, is on a learning curve to find the best cost/benefit combination for each project.”