Environmental and Energy Projects within the American Recovery and Reinvestment Act

Posted on March 5, 2009 by David P. Steinberger

On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009, also known as the Stimulus Bill. Among the numerous programs encompassed within the Stimulus Bill are significant proposed expenditures for environmental and energy projects. There are many opportunities for businesses to capitalize on the federal funding and tax incentives provided by the Stimulus Bill. But those businesses need to move swiftly to make sure they do not miss out on these opportunities.

Energy Programs

The Stimulus Bill includes approximately $30 billion for projects relating to the generation, transmission and distribution of renewable energy and approximately $5 billion for energy efficiency projects, including projects to weatherize certain properties. There are many opportunities for companies involved with the various aspects of renewable energy and energy efficiency to capitalize on the available funding within the Stimulus Bill. There may also be funds available for commercial or industrial property owners to help fund investments in energy efficiency technologies which have the potential to significantly reduce the future property operating costs. 

  • Renewable Energy. Allocations in the Stimulus Bill include (a) $6 billion in loan guarantees for renewable energy generation and transmission projects, (b) $11 billion for research, development and pilot programs relating to the so-called “Smart Grid,” which will enable greater development and use of renewable power sources, and (c) $2.5 billion for research related to renewable energy and energy efficiency. Also included in the Stimulus Bill are tax cuts for businesses investing in renewable energy technologies.  Here is the link to the US Department of Energy discussion of the Stimulus Bill: http://www.energy.gov/recovery/index.htm
     
  • Energy Efficiency. The Stimulus Bill also includes (a) $5.25 billion to make lower income housing more energy efficient, (b) $6.3 billion in grants for state and local government energy efficiency investments and (c) $300 million for consumer rebates for purchasers of energy efficient “Energy Star” appliances. The Stimulus Bill also includes tax cuts for individuals investing in residential energy efficiency improvements.

Environmental Programs

In total, the Stimulus Bill includes approximately $18.8 billion dollars in federal spending for environmental projects relating to site remediation, water infrastructure and flood control and mitigation projects. There may be opportunities to include funding for water infrastructure projects into on-going or planned development or redevelopment projects. Additionally, increased funding to the federal brownfields program may provide sufficient stimulus to continue planned redevelopments.

  • Property Remediation. $600 million is allocated to the United States Environmental Protection Agency to fund the cleanup of hazardous waste sites listed on the National Priorities List, which is the USEPA’s list of some of the most contaminated sites in the nation. With this increased spending to cleanup Superfund sites, we expect there to be a potential rise in federal cost recovery litigation as the USEPA attempts to recoup those cleanup costs from the responsible parties. An additional $200 million is allocated to cleaning up properties with leaking underground storage tanks, and $100 million is allocated for grants providing for the cleanup and redevelopment of brownfields sites. Here is the link to the USEPA brownfields program: http://www.epa.gov/brownfields/
     
  • Clean Water State Revolving Fund.  $4 billion is allocated to the states to fund loans administered under the Clean Water State Revolving Fund. This fund is designed to upgrade wastewater treatment systems and address stormwater management, nonpoint source pollution, and watershed and estuary management projects nationwide.   Here is the link to the Clean Water State Revolving Fund: http://www.epa.gov/owm/cwfinance/cwsrf/index.htm
     
  • Drinking Water State Revolving Fund. $2 billion is allocated to the states to fund loans administered under the Drinking Water State Revolving Fund. This Fund provides loans to support infrastructure investments for both publicly and privately owned community water systems. Here is the link to the Drinking Water State Revolving Fund: http://www.epa.gov/safewater/dwsrf/index.html#facts
     
  • Other Water Infrastructure. $4.6 billion is allocated to the US Army Corps of Engineers for projects such as environmental restoration, flood protection and dam projects. An additional $340 million is allocated to the Natural Resources Conservation Service, an entity within the US Department of Agriculture, for watershed improvement projects, including flood protection projects and water quality protection programs. Here is the link to the Natural Resources Conservation Service: http://www.nrcs.usda.gov/
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EPA Regulates Home Improvements To Address Risk Of Lead Paint

Posted on March 5, 2009 by Gerard M. Giordano

On March 31, 2008, the United  States Environmental Protection Agency (“EPA”), under the authority of the federal Toxic Substances Control Act, issued new rules governing home improvement contractors and maintenance companies engaged in the renovation and repair of houses, child‑care facilities and schools constructed before 1978.  The purpose of the rule is to protect children from lead paint hazards in places they frequent.  EPA’s rules require that by April 2010, contractors and maintenance professionals performing renovation activities be certified and their employees trained by certified renovators.  The rules also require that these companies use safe work practices to eliminate airborne lead exposure from the renovation activities.

The rule applies to home improvement contractors, maintenance workers in multi‑family housing, painters and other trades engaged in renovation activities.  The covered facilities include residential, public or commercial buildings where children under the age of 6 are present on a regular basis, as well as all rental housing.  The rule applies to renovation, repair or repainting activity.  The only exceptions are (i) owner‑occupied housing where children under six or a pregnant woman do not reside; (ii) minor maintenance or repair activities affecting six square feet or less of lead based paint in a room or 20 square feet or less of lead based paint on the exterior of a building and (iii) renovations that do not involve the disturbance of lead based paint.  Determining whether a project is lead free must be made by a certified renovator using an EPA recognized test kit.

The rule prohibits certain unsafe work practices such as flame burning or torching; and sanding, grinding, or blasting with power tools.  It also prohibits the use of equipment not equipped with high efficiency vacuum attachments to minimize or eliminate airborne dust.

A certified renovator must be assigned to each renovation project to direct and train uncertified workers and to insure that all work is performed in accordance with applicable work practices and standards as outlined in the rules.  A renovator can become certified by successfully completing an EPA approved accredited training course.  To maintain the certification, a person must complete an accredited refresher course every five years.

While these regulations directly impact the companies doing the renovations, property owners must remember that they are ultimately responsible for the safety of their tenants.  It is imperative, therefore, that property owners make sure that the contractor intends to comply with the EPA’s regulations and minimize lead hazards during the work.  Any contract between the property owner and renovation contractor should, at a minimum, include a provision requiring the contractor to comply with all laws during the performance of the work and an indemnification provision whereby the contractor agrees to defend and indemnify the property owner from lawsuits arising from the contractor’s work.  Since an indemnification is only as good as the company’s assets, a property owner is well advised to require the contractor to have insurance naming the property owner as an additional named insured on the policy.  As an additional named insured, the property owner will be in a position to make a claim against the contractor’s insurance policy.  By taking these precautions, property owners will minimize their exposure to potential liability if the contractor fails to comply with these regulations.

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