ASHRAE is pleased to provide the following Special Report on provisions of the recently signed American Recovery and Reinvestment Act (H.R.1). Recipients are encouraged to share this Special Report with interested colleagues who may also sign-up for the ASHRAE Government Affairs Update eNewsletter at our Government Affairs Updates page.
Stimulus Package to Impact the Building Community
On February 17, 2009 President Obama signed the American Recovery and Reinvestment Act (commonly referred to as the stimulus bill). The bill focuses on two primary means for stimulating the economy—tax credits for the private sector and spending for the public sector (with a resulting impact on the private sector). Both areas focus heavily on infrastructure and buildings related opportunities.
Private Sector Provisions
For the private sector, the stimulus includes significant incentives for utilization of renewable energy and energy efficient technologies. Tax credits for the production of renewable energy (e.g., utilities) would be extended until at least 2012 along with an expansion of qualified energy conservation bonds and renewable energy loan guarantees. Incentives for non-business energy property (i.e., residential) would see an increase in amount (up to $1,500) and an extension through 2010. Research expenses associated with renewables, conservation, and carbon capture and sequestration could result in higher tax credits in 2009 and 2010. Investment tax credits at 30% would be available for facilities that manufacture advanced energy property. The Department of Energy also is authorized to provide grants (in some cases up to 30% of the cost) to assist in installation of energy equipment including fuel cells, solar, small wind, geothermal heat pumps, and combined heat and power systems.
Bond authority also has been increased to encourage investment in energy related projects and infrastructure. The bill authorizes an additional $2.4 billion of qualified energy conservation bonds to finance State, municipal and tribal government programs and initiatives designed to reduce greenhouse gas emissions. The bill creates Qualified School Construction Bonds for the construction, rehabilitation, or repair of public school facilities or for the acquisition of land on which a public school facility will be constructed (with a limit set at $22 billion for state and local governments and a $400 million for Indian tribal governments.
Also of interest to the engineering and construction fields, the bill would delay until 2012 a provision set to begin in 2011 that would require federal, state and local governments to withhold three percent of all payments for goods and services to assure proper taxes are paid.
Finally, the bill extended through 2009 provisions allowing a business’ capital expenditures to depreciate faster by permitting the immediate write-off of fifty percent of the cost of depreciable property (e.g., equipment, tractors, wind turbines, solar panels, and computers).
Regarding spending in the public sector, funds are targeted at the federal, state and local levels. While the funds are initially targeted to improve government owned infrastructure and buildings, the private sector will need to provide the labor, technical, and manufacturing base for implementation. For federal agencies, considerable funds would be provided to retrofit and upgrade existing facilities to meet energy and water use requirements placed on federal agencies and alleviate maintenance backlogs. A quick rundown of the agencies and the amount of buildings related funding provided appears below.
- Department of Agriculture ($850 million some of which goes toward buildings)
- Department of Commerce
- National Institute of Standards and Technology ($360 million for research facility construction)
- National Oceanic and Atmospheric Administration ($830 million for procurement, acquisitions and construction)
- National Science Foundation ($600 million for modernization and construction of research facilities)
- Department of Defense ($6.2 billion)
- General Services Administration ($5.5 billion with not less than $4.5 billion to convert GSA facilities to High-Performance Green Buildings, also include $3 million for training and apprenticeship programs)
- Department of Homeland Security ($620 million)
- Department of the Interior ($1.5 billion some of which would go to buildings)
- Department of Health and Human Services ($2.4 billion)
- Smithsonian Institution ($25 million)
- Department of Education ($53.6 billion of which approximately $10 billion can be used for school and higher education modernization and repair)
- Department of Veterans Affairs ($1.15 billion)
- Department of Housing and Urban Development ($1.76 billion for public and HUD assisted housing improvements)
Other federal programs of interest include:
- Department of Energy
- Energy Efficiency and Renewable Energy ($16.8 billion for research, weatherization assistance, grants, and other programs)
- Electricity Delivery and Energy Reliability ($4.5 billion to modernize the electric grid including smart meters and demand responsive equipment)
- Advanced Research Projects Agency—Energy (ARPA-E) ($400 million)
- Department of Labor ($750 million for job training with significant focus on emerging industry sectors including energy efficiency and renewable energy)
Additionally, the Department of Energy, Energy Efficiency and Renewable Energy, may provide additional funds (above current base allocations) to states under the State Energy Grants if the governor certifies that states will work towards adoption of building energy codes at least as stringent as ANSI/ASHRAE/IESNA 90.1-2007 for commercial buildings and develop a plan for achieving 90 percent compliance with the code including training and enforcement programs. This provision could help speed state adoption of Standard 90.1-2007 and pave the way for future adoptions of 90.1-2010 which is expected to require 20 to 25 percent less energy use than the 2007 version.
About the ASHRAE Government Affairs Update
ASHRAE's Government Affairs Update features information on government affairs related activities of interest to ASHRAE members and others interested in the built environment. Archives of previous updates are available from the government affairs webpage (/government-affairs).
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