Sarah Paquette – Pre-Veterinary Sciences
Greg Kennett – Building & Construction Technology
Marshall Hood – Building & Construction Technology
University of Massachusetts Amherst
April 28, 2015
Government giving tax incentives to green building owner
Reference: Frazier, Jim. (2007). Green Buildings Get Tax Relief [Graphical Illustration], http://greensource.construction.com/features/0704mag_policywatch.asp
Imagine a workspace that was set up so every individual had access to a natural environment whether it is opening a window, basking in sunlight or smelling brisk air on a cool autumn day. Now imagine your typical cubicle. Small, artificial lighting, a little cramped, noisy from the other workers in the cubicles directly next to and around you. Which would you prefer? Some would say that the answer seems obvious – pick the workspace where you can experience the environment. Working within a building made from natural resources, you can feel more connected with your workspace and be proud of the company that you work for. It makes the daily 9 to 5 job more natural and enjoyable! This workspace is obtainable. With LEED certified buildings, the environment is and will feel fresher and cleaner leading to a healthier work environment.
Why you Should be Concerned While Working in Your Office Building
Due to the current society, most buildings have been built conventionally, meaning that they were built by normal means of construction with no aim for achieving high energy savings. These conventional buildings do not optimize health and productivity because of the materials that were used in building the “standard” office space. These conventional office buildings, which are typically cubicle style, recycle air and artificially light the building which can cause the symptoms of sick building syndrome (SBS) (Indoor Air Facts, 2007).
According to the United States Environmental Protection Agency’s Indoor Air Facts (2007), SBS causes building occupants to have symptoms such as, “headache; eye, nose, or throat irritation; dry cough; dry or itchy skin; dizziness and nausea; fatigue; difficulty concentrating; and sensitivity to odors” (p. 1). These symptoms alone can cause a company to have less productive workers along with sicker employees. Sicker employees lead to more absenteeism and loss of money for the company.
Although sick building syndrome is a reason of concern for building occupants, another concern is the financial aspect of these buildings. Although a conventional building may be easier, quicker and initially cheaper than a LEED certified building, the overall end product of the buildings themselves are completely different. Conventional buildings will cost significantly more to light, heat and ventilate when compared to LEED certified buildings (World Green Building Council [WGBC], 2013).
LEED stands for Leadership in Energy and Environmental Design and was created by the World Green Building Council (WGBC). A subset of this council is the United States Green Building Council (USGBC). They have created certifications made for buildings that will directly “save money and resources and have a positive impact on the health of occupants, while promoting renewable, clean energy” (WGBC, 2013, p. 53). There are four types of certification levels for LEED buildings and they are; LEED certified, LEED silver certified, and then gold and platinum certifications. The lower standards of LEED certifications would include LEED certified and LEED silver.
How can we Change Your Working Environment?
Building with sustainable materials under LEED guidelines will create ideal working environments for its occupants. To accomplish this, the federal government should promote LEED certification and offer higher tax incentives to yield cost savings, increase productivity and promote overall occupant health. Tax incentives should be offered for a period of time especially for first time LEED certified building owners. This will get owners and builders into building energy efficient to then show other owners and builders the extraordinary benefits that come from building up to LEED standards.
An attractive offer that comes with LEED buildings is financial savings over the years. Estimates for the reduction in a green buildings energy use compared to a conventional code-compliant building range from 25% – 35%, based on LEED-certified buildings in the United States (WGBC, 2013, p. 53). Additionally LEED buildings that incorporate water savings into the design, which can be as simple as installing efficient appliances such as toilets or faucets, save an estimated 39% of water over conventional buildings (WGBC, 2013, p. 53).
This will correlate with apartment buildings having much lower utilities cost for its tenants. This drop in energy usage will also yield a high savings margin for the owner by having a less expensive building to maintain and an apartment complex could also charge higher rates. Noted in the study is when building green, the higher the level of LEED certification the higher the level of savings you can expect to see. A study on 33 LEED buildings done in 2003 found that LEED buildings would earn a savings of over ten times the initial investment in just 20 years (Dailey, 2015, para. 6). The figure calculated to create 10 times the initial investment included energy savings from operational costs and an increase in productivity which is just another benefit from green building that can increase savings (Dailey, 2015, para. 6). All of these savings will surpass any of the construction premiums that were associated with initial startup costs. Dailey (2015) showed that between the years of 2000 and 2012, “actual cost premiums range[d] from zero to 12.5%, with the higher premiums directly correlating with a higher standard of green building” (p. 1), meaning that the higher cost for the green building, the higher the LEED certification it would receive. Building a LEED certified building is becoming more common enterprise as well with green building products are becoming more mainstream. We can build lower standard green buildings for just as much as a conventional (Dailey, 2015).
Office buildings that choose to build with natural materials and become LEED certified will be rewarded with more productive workers within their buildings. Most LEED certified buildings have a better indoor environmental quality (IEQ) which includes a preferred thermal, visual, acoustic and air quality effect. The IEQ can be directly associated with worker productivity. When a group of office workers were switched from a conventional building to a new, LEED certified building with IEQ, “the improvements in perceived productivity were fairly substantial and could result in an additional 38.98 work hours per year for each occupant of a green building” (Singh, et al., 2010, pp. 1665-1668). The significant increase in work hours means that the company would be making more money overall because their employees are working more due to the improved building conditions and they are happier employees, so they would be inclined to stay with the company. Having better IEQ within the building will also prevent sick building syndrome (SBS).
Fisk (2000) discusses sick building syndrome and its negative effects on the productivity of the occupants who work inside the building. Workers who reported symptoms of SBS within the year prior to Fisk’s (2000) study stated that the physical conditions of the building influence their productivity. To prove that SBS has a negative impact on occupants within the building, there was a computerized neurobehavioral test given to occupants who reported SBS symptoms and to those who had not reported symptoms. The results found showed a 30% higher error rate than those who did not show SBS symptoms which would accrue to approximately a 14% decrement in performance among those with SBS symptoms (Fisk, 2000, p. 14). Having a building that prevents SBS symptoms will be beneficial, and most of the symptoms can be prevented through green buildings that have better air quality, natural lighting and better acoustics.
Edwards (2006) discusses how natural light affects occupants productivity in a work space. He shows that workers who are given access to natural conditions such as natural sunlight or being able to open a window allowed for a 1.8% improvement in overall staff productivity (Edwards, 2006, p. 200). By increasing the natural environment in the workplace, workers will have increased “improvement in psychological and physical health of those who work in office buildings,” (Edwards, 2006, p. 200) which then in turn leads to improved productivity.
LEED buildings are built with healthier materials which allow occupants to have better airflow, and lighting. In a study on green buildings done in 2010 it showed just how green buildings can improve health and productivity of employees. The study followed two companies that started out working in a conventional style building and then moved into a LEED certified building and showed the positive effects it had on workers. The higher air quality of the LEED buildings proved to cut absences for employees with respiratory related illnesses in half (Singh, Syal, Grady & Korkmaz, 2015, p. 1666). The mean hours a month employees took off for their illnesses ranged to about 18 hours per month. Once they switched to a LEED building their mean hours per month dropped to about 8 which is less than half (Singh et al., 2015, p.1666). The improvement also satisfies its occupants because of improved and more comfortable indoor spaces that are healthier for them.
In addition to worker productivity, health benefits can arise improving increased Indoor Environmental Quality (IEQ). Indoor Environmental Quality (IEQ) is essentially the quality of the environment in which you work including lighting and air quality (Indoor environmental quality, 2013). After a survey was conducted amongst employees in various environments, in areas of increased IEQ, the authors point out that “satisfaction level for the ability to adjust the work area,” (Ries, Bilec, Gokhan & Needy, 2006, p. 271) is higher than neutral with a rating of 4.74 out of 7 (Ries et al., 2006, p. 271). Relocating employees from their conventional environment to a LEED certified green building will positively affect employee satisfaction, productivity, and overall health and well-being. Singh et al. (2010) conclude that there were fewer reports of self-reported absenteeism and better overall health among employees. During their study on improved IEQ and increase in overall health, Singh, et al. (2010) observed, “that perceived improvements in asthma and respiratory allergies could provide 1.75 additional work hours per year” (p. 1665-1668). To simplify, improving your Indoor Environmental Quality in any scenario can be held directly responsible for an increase in individual health and decrease in symptoms of diseases linked to air quality.
To increase productivity, occupant health and overall financial savings, tax incentives and promotion of LEED certification through the federal government should be put into place. These tax incentives will encourage not only building owners, but homeowners alike to consider building a LEED certified building to reap the tax benefits. Not only will they receive the tax benefits, but they will have a healthier, more productive lifestyle along with having more savings in the end from energy decreases and productivity increases.
Building a new sustainable building may sound overwhelming and the price may seem overwhelming as well. While conventional buildings are cheaper to build in the short-run, a green building will cost less overall in the long-run. A LEED certified, sustainable building costs only 2% higher than a building being built conventionally (Fuerst & McAllister, 2011, p. 4). Ries et al. (2006), showed how conventional buildings were more expensive in the long run. When looking at operational costs of the building, a conventional building, on average, would cost $1,446,074 annually compared to $1,369,139 annually for a green building which would give an overall savings of $76,935 a year (Ries et al., 2006, p. 278). In the end, the initial 2% extra that you pay for the building to be built will be given back through a minimal utilities bill.
Building green is becoming cheaper and cheaper by the day. According to Dailey (2013) the cost of LEED buildings from 2001 to 2011 has dropped dramatically. This should be expected as materials for green buildings are becoming more common. Dailey (2013) reports, “that more construction and design professionals know how to create green buildings, and the tools to learn about sustainable building are more readily available,” (para.3) which also is allowing for better design which can bring the costs down.
Contractors are very concerned with building a good product and in a timely fashion to in turn make themselves the most money. This competes with the idea of making all construction projects LEED certified because the conventional way of building is often the easiest and quickest way to get it done. Building for a LEED standard can take more time and thought which turns off a lot of contractors who are out there making a living off the number of homes built not the quality of homes. By educating contractors about the possibility of earning more money for building a LEED certified building, they may be more interested in building them and convincing homeowners to build with sustainable materials.
Some may not support having this green building initiative through taxpayer dollars; it serves the people who participate in healthier and innovative buildings. New York had the first green building tax credit plan where they spent approximately $25 million within the first year to give tax incentives to owners of buildings in Manhattan who built LEED certified buildings (Roberts, 2007, p. 22). Roberts (2007) discusses the huge success and how other states are now considering it and creating the bill to make it official:
Baltimore County [and] Maryland [will] give a full property tax abatement for 10 years to commercial building[s] achieving at least LEED Silver…[whereas]…Chatham County [and] Georgia offer LEED Gold buildings property tax abatement for 10 years, while Cincinnati grants tax abatement for all LEED-certified buildings, including 15 years abatement for new construction” (p. 22).
Many of the people who live in these areas have not noticed the increase in taxes, this increase coming from the new construction jobs. In fact, these state incentives have encouraged more states to consider this kind of incentive for green construction. These encouragements don’t only need to go towards new buildings but they can also be aimed at existing buildings.
This brings on a different project of retrofitting buildings, causing you to go in and replace the old with the new in order to achieve LEED certification. This also brings up arguments that it is just not worth retrofitting buildings because of high costs and the problems that often arise when tearing into old buildings. Global projects are proving this to be false. WGBC (2013) states that the newly retrofitted empire state building in New York has cut its energy use by 38% and is saving 4.4 million dollars annually (p. 53-56).
The Empire State Building is now a model for the rest of the buildings in the world even though it is a skyscraper; its methods of going green can be applied at any scale from studio apartments to massive homes. One way that the Empire State building went about its amazing energy savings was to take out all the 6,514 windows and install a low emissivity film which keeps the heat in because it is reflected more than it is emitted out the windows (National Institute of Building Science, 2015, para. 2). When updating the old windows they also used a special gas mixture between the old panes, this and the low E film took the windows previous r-value of 2 to an r-value of 8 (National Institute of Building Science, 2015, para. 3). R-value is the resistivity of heat through an object, the higher the r-value the harder it is for heat to travel through that object and in this case it is glass. This is just one of the improvements that were done to the Empire State Building. They also cleaned the heating and air conditioning units that sit inside the building on the outside walls. When they were doing this they installed a reflective foil sheet behind the radiators to bump up r-values in these areas, the foil sheeting does exactly as the name states, it reflects heat back into the building instead of emitting it out of the building. There are even more measures that were taken to increase energy savings of the Empire State and make it the model it is today. The building will make back its investment of green materials in only 3 years, proving to be one of the most successful retrofitted LEED examples in the world (WGBC, 2013).
Office buildings and homes are the first buildings suggested to be built with LEED standards, but other buildings have already taken the initiative. The University of Massachusetts Amherst has taken the initiative of retrofitting and building new classrooms, laboratories and dining commons to the LEED standards. Some examples of this are the UMass Police Station, the Hampshire Dining Commons, the Integrative Learning Center, the Life Science Laboratories I and II and the George N. Parks Minuteman Marching Band Building are all LEED Gold certified with new sustainable buildings being built and retrofitted on campus throughout the year (University of Massachusetts Amherst, 2015). Not only will these be conductive to the students and professors learning and performing research within these buildings, but it also allows the campus to have a more appealing and sustainable feel. Prospective students are more drawn to a campus that is willing to build appropriate buildings to aid their academics and performance. By building with sustainable materials and achieving a LEED Gold certification, the buildings have great IEQ which leads to better productivity and health. This can be applied in many other situations as well, such as apartment complexes. As a building owner, you could charge slightly higher rent for occupants who prefer to live in your complex because it is sustainable.
The future includes saving the environment and creating a better and safer world for us to live in. This includes building sustainable and green engineered buildings which will be better for the environment, our health and even make us more productive to keep up with the changing society and world.
Dailey, J. (2013, May 7). An introduction to the cost benefits of green buildings. Curbed.
Edwards, B. (2006). Benefits of green offices in the UK: Analysis from examples built in the 1990s. Sustainable Development, 14(3), 190-204. doi:10.1002/sd.263
Fisk, W. J. (2000). Health and productivity gains from better indoor environments and their relationship with building energy efficiency. Annual Review Of Energy & The Environment, 25(1), 537-566.
Fuerst, F. and McAllister, P. (2011). Green noise or green value? Measuring the effects of environmental certification on office values. Real Estate Economics, 39: 45–69. doi: 10.1111/j.1540-6229.2010.00286.x
Indoor air facts No. 4 sick building syndrome. (2007, April 4). pp. 1-3 Retrieved from http://www.epa.gov/iaq/pdfs/sick_building_factsheet.pdf
Indoor environmental quality. (2013, June 20). Retrieved from http://www.cdc.gov/niosh/topics/indoorenv/
National Institute of Building Sciences. (2015). Empire state building retrofit. Retrieved from http://www.wbdg.org/references/cs_esb.php
Ries, R., Bilec, M., Gokhan, N., Needy, K. (2006). The economic benefits of green buildings: A comprehensive case study. The Engineering Economist, 51(3), 259-295. doi:http://dx.doi.org/10.1080/00137910600865469
Roberts, T. (2007, April). Green buildings get tax relief. Green Source. Retrieved from http://greensource.construction.com/features/0704mag_policywatch.asp
Singh, A., Syal, M., Grady, S., & Korkmaz, S. (2010, September). Effects of green buildings on employee health and productivity. Am J Public Health, 100(9), 1665-1668. doi: 10.2105/AJPH.2009.180687
University of Massachusetts Amherst. (2015). Buildings. Retrieved from http://www.umass.edu/sustainability/green-campus/buildings
World Green Building Council. (2013). The business case for green buildings: A review of the costs and benefits for developers, investors and occupants. Retrieved from http://www.worldgbc.org/files/8313/6324/2676/Business_Case_For_Green_Building_Report_WEB_2013-03-13.pdf