BUILDING in Maryland and Washington, DC

EXCLUSIVE MAGAZINE OF THE MARYLAND-NATIONAL CAPITAL BUILDING INDUSTRY ASSOCIATION

JULY/AUGUST 2009

BUILDING IN MARYLAND AND WASHINGTON, DC

Custom Builder

2009 Awards ALSO IN THIS ISSUE: Going Green: The Next Best Thing in Homebuilding

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2009 Multifamily Trends Conference sponsored by MNCBIA & NVBIA Wednesday, November 18, 2009 8:00 a.m. - Noon Tysons Corner Crowne Plaza The Economy Anirban Basu, Sage Policy Group The Apartment & Condominium Markets Julie Smith, Bozzuto Management Pam Meding, Bozzuto Homes The Industry CEO Roundtable For registration information call Diane Swenson at 301-445-5401

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Maryland-National Capital Building Industry Association 1738 Elton Road, Suite 200 Silver Spring, MD 20903 Phone (301) 445-5400 Fax (301) 445-5499 E-mail: communications@mncbia.org Website: www.mncbia.org

BUILDING

IN MARYLAND AND WASHINGTON, DC Representing Calvert, Charles, Montgomery, Prince George’s and St Mary’s counties in Maryland and Washington, DC

Executive Committee THOMAS M. FARASY President JAMES KETTLER Vice President/ Calvert Co. DOUG MEEKER Vice President/ Charles Co. FRANK BOSSONG, IV, P.E. Vice President/ Montgomery Co. MARTY MITCHELL Vice President/ Prince George’s Co. EDWARD “GUY” CURLEY Vice President/ St. Mary’s Co.

BRIAN “A.J.” JACKSON Vice President/ Washington DC ROBERT A. JACOBS Associate Vice President BOB LARKIN Treasurer CHAS STUART JR. Secretary WILLIAM M. SHIPP Life Director RICHARD A. SULLIVAN JR. Immediate Past President STEPHEN P. ELMENDORF Legal Counsel DIANE K. SWENSON, CAE Executive Vice President

Board of Directors Bill Bilo Hillary Colt Cahan Mike Conley Tony Crane Timothy Dugan Robert Harris Howard Katz Gary Kret Andrea Leahy-Fucheck David Lunden Steve Nardella David O’Bryan Stephen Paul

Nanci Porten Steve Proctor Marc Rose Andy Rosenthal Gary Rubino Ted Smart Ray Sobrino Stephen Spano Clark Wagner Peggy White Bryan Whittington Carter Willson

MNCBIA Staff Executive Vice President - Diane K. Swenson, CAE Communications Manager - Kelly H. Grudziecki Financial Services Manager - Linda Groft Director of Government Affairs - F. Hamer Campbell, Jr. Associate Director/Legislative Affairs Raquel Montenegro Associate Director/Regulatory Affairs Annette T. Rosenblum Membership Coordinator - Debi Turpin Member Services Coordinator - Samantha Ager Program Manager - Builders Development Guaranty Group Debi Turpin Program Manager - Home Builders Care Foundation Patricia B. Kane

Published for: Maryland-National Capital Building Industry Association 1738 Elton Road, Suite 200 Silver Spring, Maryland 20903 301 445-5400 Fax: 301 445-5499 E-mail: building@mncbia.org Website: www.mncbia.org Published by:

Naylor, LLC 5950 N.W. 1st Place Gainesville, FL 32607 800 369-6220 352 332-1252 Fax: 352 332-3331 Website: www.naylor.com

JULY/AUGUST 2009

2009

FEATURES 8

Custom Builder Awards Quality is Up – Even if the Market is Down

13

Going Green The Transformation to Green Homebuilding has Begun.

Custom Builder

Awards

8

DEPARTMENTS 7

A Message from the President of MNCBIA

14

The Legal Pad

15

The Engineer’s Angle

16

MNCBIA Membership News Stars Club Members in the News BIA’s “Most Wanted” List New Members

18

Advertiser.com

18

Index of Advertisers

Publisher: Christopher Hodges Editor: Catherine Jones Project Manager: Jason Dolder Publication Director: Jason Ruppert Advertising Sales: Denise Creegan, Don Ryan Marketing: Heather Zimmerman Layout and Design: Gordon Klassen Advertising Art: Lesley Helash

PUBLISHED JUNE 2009/MNC-S0409/8570

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FROM THE PRESIDENT

It’s the Second Half— What’s the Game Plan?

M

Tom M. Farasy

aryland’s formal legislative session officially came to an end on April 13. The word is we did “Okay,” considering what could have happened. Upon closer examination, however, two facts emerge – The Governor’s legislative program is not business-friendly, and the county governments are increasingly using the state legislative process to further their agendas.

At present, we are actively laying out our platform at the state level; however, we are not being welcomed with open arms. Everyone is aware of the economic issues facing our industry right now, but today the attitude is one of “let’s legislate now” so when the recovery does arrive, we do it “right.”

What the legislators don’t understand, or seem to have not considered carefully, are the consequences of their legislative actions and the economic impact of those actions.

The fact is, their actions will cause work to be further delayed or projects to not be completed at all. Projects that were marginal to begin with won’t proceed, thus furthering the extension of our economic woes!

The building industry desperately needs Maryland to supplement the $8,000 federal tax credit, just as many other states have done. This measure should be tied to new home sales and should serve to create jobs.

The MNCBIA has identified some program objectives and is working TODAY on what needs to be done in the coming years by lobbying at the state level on local matters. It is clear that just as the development/construction paradigm is changing, our state advocacy program paradigm needs to evolve.

Our industry has made a good start at the county level: In Charles County – legislation is imminent to suspend plan expirations, expedite the bond reduction process, defer impact fees and other elements.

In Montgomery County – plan expirations were suspended for two years, building permits were extended for an additional six months, a bill to defer the impact fees from building permit to final inspection was deferred (and at press time scheduled to go back before the County Council on May 13, 2009.) While this is beneficial, more needs to be done.

The MNCBIA has written a letter to the County Council spelling out measures that the Council should consider – You can read it on MNCBIA’s Website. We have also testified before the WSSC, which you can also find on the Website.

In Prince George’s County – plan expiration suspension has been voted out of Committee. Very soon a bill will be introduced to change Street and Storm Drain Permit Extensions to 24 months and allow bonds to be used in bond reductions rather than the current requirement for cash or letters of credit. In addition, we are working with the County

Executive and County Council to develop programs to reduce the current inventory of homes, including foreclosures, and stimulate the buying of new homes. The extensive inventory is priority one in Prince George’s County and must be dealt with if the county’s housing industry is to stay healthy and viable and be competitive with that of neighboring jurisdictions.

In St. Mary’s County – legislation was introduced to suspend plan expirations. Other actions, such as permit extension, impact fee revisions, etc., will be addressed in subsequent legislation and have been well received by county leaders.

Each one of these legislative actions has involved a process of active engagement, several hearings, many meetings, pages of testimony, and extensive submission of documents!

BIA’s advocacy staff and liaison vice presidents as well as the state and county committees are all working extremely hard and we owe them our continued appreciation.

We are halfway through 2009, but there is still plenty of work ahead. As you reorganize your companies, redesign your products and work to meet the new challenges of the development and construction paradigm it is also necessary for you to urge our county governments to evolve with us. Speak up now!

What is now crystal clear to our county leaders is their financial link to our industry. The political realities are challenging and require a strong commitment! This is further complicated by the budget and economic challenges that are faced in all jurisdictions. President Obama’s stimulus plan provided a “temporary” fix, in many cases, to the county and school board budgets. However, the counties cannot expect this windfall again next year. Therefore, we must be at the table with our county partners, to make sure programs, policies and directives allow everyone to be financially successful.

On a related and important note, our membership committee is working overtime to accomplish the goals set out for 2009. In April more than $100,000 in membership dues was collected from current and reinstated members. This is a great accomplishment, however, membership retention and solicitation continues to be a challenge. Everyone on the Committee is working overtime, and with great passion and energy. Even non-committee members understand that membership is what keeps this association viable and are doing their part.

It is not possible to thank everyone by name. The proof is in the results – KEEP UP THE GOOD WORK, and thanks for all you do!

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2009

Custom Builder

Awards

C

ustom homebuilders, architects and remodelers throughout the greater Washington region were awarded top honors for their fine design and quality workmanship in the 16th Annual MNCBIA Custom Builder Awards on May 28 at the Bethesda Marriott Hotel. Winners were chosen in 19 categories and displayed architectural styles ranging from traditional to contemporary to transitional and included kitchen remodels to whole house and condo renovations.

Judging was done over a three-day period, utilizing the expertise of architects, builders, land planners, and marketing consultants. The judges viewed both interior and exterior of the homes, in addition to detailed written information, photographs, and plans.

In this competitive custom housing market, all of these winners are shining examples of the talent and expertise that our area has to offer.

In the category of Speculative Home Under 3,500 sq. ft. one home stood alone. The Gold Award went to Miller Development Corp. for a house on a corner lot in East Bethesda that gives the owners a livable, comfortable layout built to a modest scale. The designer was Studio Z Design Concepts, LLC.

In the category of Speculative Home 3,500 to 5,000 sq. ft., the Gold Award was presented to The Banks Development Co. for a “new old home” inspired by the traditional older homes in its Chevy Chase neighborhood and designed by GTM Architects. The Silver Award went to Chase Builders, Inc. for a Chevy Chase home designed with the thought of formal entertaining yet maintaining the intimacy of a family home. The architect was Studio Z Design Concepts, LLC.

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Taking home the Bronze Award was Miller Development Corp., for another Bethesda home that offers

seasonal golf course views and was also designed by Studio Z Design Concepts, LLC.

BUILDING IN MARYLAND AND WASHINGTON, DC

In the category of Speculative Home 5,000 to 7,500 sq. ft., there were just two winners. The Gold Award went to Laurence Cafritz Builders for a tear-down that was re-born to appeal to a

family desiring a spacious house in a close-in Bethesda location. The architect was Sutton Yantis Associates Architects. The Silver Award was presented to Chuck Sullivan Homes for a Bethesda home that tripled the size of the previously existing house yet meshed with the surrounding properties. The architect was Studio Z Design Concepts, LLC.

In the category of Speculative Home Over 7,500 sq. ft., the lone winner was Wood Visions Construction, Inc. taking home the Gold Award for a classic arts and crafts style home in Potomac designed by Rill & Decker Architects, PC to blend with the picturesque equestrian community of Merry-Go-Round Farm.

The custom built homes group features homes designed and built to the unique requirements of the client.

In the category of Custom Home Under 3,500 sq. ft. the sole winner taking home the Gold Award was Paramount Construction for a home in Bethesda who’s owners wanted a non-traditional design yet one that fit into their eclectic and cozy neighborhood.

Rounding out the speculative homes group is Speculative Traditional Home.

The Gold Award was presented to Studio Z Design Concepts, LLC for an arts and crafts style home tucked into a cascading hill of its Chevy Chase infill site. The builder was Patrick K. Keating & Co., Inc. The Silver Award went to Washington Metropolitan Homes for a house in Bethesda that offers the comforts of suburban living while being closein to downtown Bethesda and DC. The architect was Chris Lapp.

In the category of Custom Home 3,500 to 5,000 sq. ft. there was also just one winner. The Gold Award went to Bethesda Bungalows for a oneof-a-kind house at the heart of “Bungalow Row” in Chevy Chase and conceived by home designer Christian Gladu of The Bungalow Company.

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In the category of Custom Home 7,500 to 12,500 sq. ft. there were two winners. Taking home the Gold Award was Tulacro Development, LLC for a home in Bethesda that was constructed by the builder, for the builder. The architect was Claude C. Lapp, AIA. The Silver Award went to Studio Z Design Concepts, LLC for a clean-lined traditional home on a quiet cul-de-sac in Potomac built by Sandy Spring Builders, LLC.

In the category of Custom Home 5,000 to 7,500 sq. ft. the Gold Award was presented to Studio Z Design Concepts, LLC for a home that incorporated views from atop the highest point of a working farm in Frederick, MD. The home was built by its owner’s Bud and Tracey McPherson, and overseen by construction manager Tom Horner. The Silver Award went to Alliance Homes for a home in Bethesda reminiscent of an historic farmhouse designed by GTM Architects. Taking the Bronze Award was Studio Z Design Concepts, LLC for a home built by Tulacro Development, LLC and “carved” into a sloping hillside in Bethesda, MD.

In the category of Custom Home Over 12,500 sq. ft. the Gold Award stand out was Sandy Spring Builders, LLC for a home in Bethesda with the look and feel of a French country home but with all the modern amenities and comforts. The architect was Glenn Chen Fong.

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Like the speculative homes category, the custom homes category was also judged on specific styles.

In the category of Traditional Custom Home, where both the exterior and the interior of the house are traditional in style, there were many entries. Bell Builders, Inc. was honored with a Gold Award for a home in Poolesville that captured the essence of an old established country estate home. The architect was Hutchinson & Associates, LLC. The Silver Award went to Block Builders for a home in the long established Palisades neighborhood in Washington that used detailing to evoke the feel of a home built in the early 1900’s.

The architect was Donald Lococo. Taking home the Bronze Award was Murray A. Cohen Custom Builder, LLC for a home in Potomac that was inspired by Southwestern and Tuscan architecture and designed by architect Claude C. Lapp, AIA.

BUILDING IN MARYLAND AND WASHINGTON, DC

2009

A style emphasizing clean lines and angles, the Custom Contemporary Home category saw only one winner. Honored with a Gold Award was Rosenthal Homes for an elaborate house in Washington, DC that pulled in the owner’s love of pop art and modern design and provided ample space for entertaining. The architect was Alter Urban LLC.

Custom Builder

Awards

Awards were also given for renovation work, where homes were transformed by either whole house renovations or significant additions to an existing structure.

BEFORE

AFTER

In the category of New or Remodeled Kitchen, there was just one winner. Taking home the top prize of a Gold Award was Crescendo Builders, LLC. The original design called for just updating the cabinets and appliances, but after viewing the relationship of the living room, dining room and kitchen it was decided that a more extensive renovation would improve the flow. By opening up the spaces to each other the design created a larger gathering space for family while providing room for entertaining.

BEFORE

In the category of Custom Transitional Home, where the design elements are a blend of both traditional and contemporary, there were three standouts and a tie for gold. The first Gold Award went to The Banks Development Co. for a spacious home in Bethesda that manages to still feel intimate and conveys a friendly arts-and-crafts flavor. The designer was GTM Architects. Also receiving a Gold Award was Douglas Construction Group LLC for a home in Bethesda that was designed to resemble an Italian villa.

The architect was Claude C. Lapp, AIA. Winning a Silver Award was Whittington Design/Build for a four-level Rockville home described as “Craftsman/Shingle style” that includes some “special rooms” including a “man cave” and “tap room.”

The designer was Fox Architects.

AFTER

In the category of Custom Addition Under 2,000 sq. ft., the Gold Award went to Brooks Run Builders for a waterside home in California, MD that nearly doubled in size thanks to the addition. The key to adding as much space as the original home contained was creating four separate additions and incorporating each of them into the existing spaces, all within the parameters of the current building restrictions.

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AFTER

BEFORE

AFTER

The Silver Award went to Windsor Construction Group for adding a one-story addition on a full basement to the rear of the home in Potomac.

The addition included a new first floor family room with wood burning fireplace and vaulted ceiling. The basement received a new theater room and wet bar. The architect was Flanagan Architects.

BEFORE

In the category of Custom Addition Over 2,000 sq. ft., there was just one winner. The Gold Award was presented to Paramount Construction who took a small 1950’s home and turned it into a unique, vibrant and contemporary story and a half home ideal for its empty nester homeowners with space for entertaining and an artist studio and loft for hobbies.

The next category, Whole House Renovation, had a number of outstanding entries, with a tie for Gold. The first Gold Award went to Bell Builders, Inc. who was tasked with the challenge of updating the home’s existing interior spaces and creating additional living space for the family while maintaining the historical styling and elegance of the original home and neighborhood. The architect was Hutchinson & Associates, LLC.

AFTER

BEFORE

Also honored with a Gold Award was BOWA Builders, Inc. for the transformation of a home in Potomac that included an extensive renovation of the home’s interior, several additions, total regrading of the rear of the property and modifications to the front elevation. The architect was Kramer Architects.

AFTER

BEFORE AFTER

AFTER

AFTER BEFORE

The Silver Award went to Studio Z Design Concepts, LLC, who together with builder Pine Crest Builders Inc., enhanced an historic 1800’s farmhouse in Brinklow, MD, to meet today’s contemporary lifestyle while taking great care to preserve and reuse elements of the original home. Major additions included a new front porch and side porches, a new kitchen and family room and an extended master bedroom suite.

The Bronze Award went to Windsor Construction Group for reconfiguring an existing split-level house into a conventional three-story home in Kensington that gave the homeowners a new spacious kitchen and great room, a basement exercise room, a master suite and a screen porch with patio area. The designer was Flanagan Architects.

Our final category, and a new one this year, is Condominium Renovation.

Having the honor of being our first Gold Award winner was Chrisler Homes, LLC for the transformation of a 1980’s Bethesda condo into present day luxury. The project began as a floor to ceiling demolition, the

only element left intact being the master bathroom tile. Everything in this home was redesigned, revamped and reconfigured and finished with lavish features like Brazilian cherry hardwood floors, glazed wall finishes and state of the art appliances. The architect was Horne International.

BEFORE

Congratulations to all the winners whose work creates both homes and masterpieces.

And finally, a special thank you to Dennis Hockman, publisher of Chesapeake Home Magazine, and our official partner in these awards, as well as our Grande Sponsor, Century Stair Company.

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Homebuilding is Greening Up

By Michael ael Fickes hat will the homebuilding industry look like after the recession? “Every green builder knows that green is the next big thing,” says Calli Schmidt, director of environmental communications with NAHB. “It won’t come overnight, but there will be a magic confluence of consumer demand, builder education and product availability.”

In fact, the transformation to green homebuilding has already begun. Ninety of 270 local and state building associations, including the Maryland-National Capital Building Industry Association (MNCBIA), have affiliated with NAHB’s National Green Building Program.

In May, the U.S. Environmental Protection Agency (EPA) issued the first draft of a major upgrade to its Energy Star Program and solicited pubic comments.

So get ready. The end of the recession will bring change to homebuilders in the form of an industry-wide revival that will turn greener and greener.

W

A Holistic Approach Winchester Homes in partnership with Design for Life Montgomery opened its new Universal Design Green “Showhome of Ideas” at Clarksburg Village in Montgomery County in February. “What’s new about this is that it is a holistic, sustainable house rather than a collection of green pieces,” says Randy Melvin, director-research, standards and design assurance with Winchester Homes.

The energy efficient showhome features a sealed envelope to prevent air infiltration through the walls. For instance, spray-on foam insulation seals the rim joists on the first and second floors.

A home wrap covers the outside of the wood sheathing and air-seals the rest of the house.

A porch shades the south side of the house to help control cooling costs. The porch also shields the door from water and increases durability.

Deciduous trees shield the southwest corner of the house, blocking the sun with leaves in the summer and allowing the sun to warm the windows in the winter.

Then comes the heating and cooling system.

The building code requires furnaces that are 78 percent efficient. Winchester Homes selected a

furnace that is 92 percent efficient. It is a direct vent, condensing furnace that exhausts through the wall of the house.

Next, the builder sized the system, including the ductwork, with a software application that models HVAC systems by matching them to the size of the house and the local climate. The model’s specifications included a 95-degree day and a 13-degree day, the square footage of the house, square footage of the windows, orientation to the sun, window coverings and geographic locations.

“Throughout the house, we applied fundamental building science principles,” Melvin says.

Now Comes The NAHB-Green ANSI Standard Green took another giant step with the introduction of an American National Standards Institute (ANSI) national green building standard, which the homebuilding industry and ANSI have completely vetted.

NAHB contributed to the standard’s development and approval and has charged the NAHB Research Center, a wholly owned subsidiary of NAHB, to certify homes against the standard.

While that may sound like something adopted from the Leadership in Energy and Environmental Design (LEED) process, it is quite different. “Our ratings are bronze, silver, gold and emerald,” Schmidt says. “But every level of this standard moves 15 percent higher above the building code.

To build a bronze level home, you have to be 15 percent more efficient than the 2006 International Energy Conservation Code.”

By the time a home gets to the Emerald level, it is 60 percent more energy efficient than the building code requires.

Green Renovations What will the green era mean for existing homes? “Existing homes will have to catch up with new homes if homeowners expect to sell and move up,” says Sam Rashkin, national director, Energy Star for homes, with the EPA. “Within the next 10 years, a lot of us will start doing whole energy makeovers to our homes.”

Burtonsville, MD-based Efficient Home LLC looks forward to that. Today, about half of Efficient Home’s business involves improving the

energy efficiency of existing homes using the principles of building science.

“Building science begins with an evaluation of a depressurized house,” says Efficient Home partner Tony Crane. “As we pull air out of the house, a manometer measures how much air the house pulls in. Then we take pictures of the house with an infrared camera. The pictures show hot spots and cold spots in different colors.”

Once the leaks have been found, Efficient Home plugs them and right-sizes the heating and cooling systems.

Only a few years ago, energy efficiency improvements were hard to sell. Since then, notes Crane, Maryland utility costs have skyrocketed.

Today, energy makeovers pay for themselves through lower utility bills within a few years.

Energy Star And More Building Science The EPA introduced its Energy Star program in 1996. It covered sealing the walls against outside air, duct sealing, verification and more efficient appliances and heating and cooling systems. An upgrade later added air barriers, insulation, rightsizing systems and other ideas.

In May, the EPA put out another upgrade for public comment. New features include minimum thermal bridging, pressure balancing, ventilation, water managed construction of roof, walls and foundation, humidity barriers in hot climates and additional HVAC insulation to boost efficiency.

“Our goal from the beginning of the Energy Star program was to make the program reflect building science, and that’s what we’ve done here,” says Rashkin.

The new Energy Star will make certifications more difficult to come by. “Homebuilders haven’t had this kind of holistic building science expertise,” Rashkin continues. “From this point on, many builders will need a systems engineer to manage the pieces and the quality control of the whole building system.”

Others in the home building and residential real estate worlds will need training in the basics of building science to, continues Rashkin. “It isn’t just builders that will need training, it is the trade contractors, appraisers, realtors — everyone.”

While the latest rendering of Energy Star will apply the basic principles of building science to homebuilding, green homebuilding will continue to grow. “Next will come the drive toward zero energy, which begins with more air sealing and insulation systems and ultimately goes after renewable systems like wind, solar and geothermal power,” Rashkin concludes.

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The Legal Pad Solar Incentives in Maryland – The Numbers May Just Add Up

by Darin Lowder and Shelah F. Lynn, Ballard Spahr Andrews & Ingersoll LLP

P

rovisions in the recent American Recovery and Reinvestment Tax Act of 2009 (ARRTA), combined with state and local incentives in Maryland for projects utilizing solar power, create a compelling case for adding solar power to both new residential and commercial construction projects as well as rehabilitation projects in Maryland. The use of solar power systems may qualify the project for tax credits, provide an opportunity for alternative project financing, and may offer creative marketing approaches.

Because utilities in Maryland are required to provide a set amount of power using renewable energy through the state’s Renewable Portfolio Standard (RPS), such utilities are willing to pay the producers of renewable energy for the green attributes of the energy produced (referred to as renewable energy credits, or RECs).

Solar power has a specific, aggressive target under the RPS, and, as a result, the value of solar RECs in Maryland is quite high. When the value of solar RECs is combined with the value of the electricity produced, the output is currently worth several times what fossil-fuel energy would be worth. As a result, together with other state and federal tax incentives, many installed solar power systems in Maryland are delivering power at prices below utility rates, making solar projects cost-effective.

State incentives Maryland now has both a sales tax and property tax exemption for solar power property (both commercial and residential) exempting the property from the otherwise applicable state tax. A number of Maryland counties also provide a property tax credit equal to a portion of the value of installed solar power property. Maryland also provides for a state income tax credit for green buildings as well as a solar rebate of up to $10,000.

Rehabilitation incentives Under ARRTA, near zero-interest loans may be available to finance renewable energy or energy efficient rehabilitations of private facilities, as part of a “green community program,” which could be used for either commercial or residential projects. These bonds, referred to as Qualified Energy Conservation Bonds, are allocated by population, and must be issued by state or local governments. Maryland has been allocated about $58 million, so the amount available for specific projects may be fairly small, but the financing terms are extremely favorable. These low-interest bonds could provide additional financing for rehabilitation or high efficiency new building projects, even if privately owned.

Maryland now has both a sales tax and property tax exemption for solar power property (both commercial and residential) exempting the property from the otherwise applicable state tax.

Federal incentives Last year, the 30 percent federal investment tax credit for commerciallyowned solar installations (which may be installed on residential locations) was extended through the end of 2016. ARRTA created a cash grant option for this credit that allows recipients of the credit to receive a cash grant equal to the credit, regardless of whether the taxpayer has a current tax liability.

Additionally, last year, the $2,000 limit on the 30 percent tax credit for residential solar installations was removed. Electric utilities, previously prohibited from claiming the commercial solar credit, are now able to do so. These changes make the purchase of solar equipment by homeowners more financially attractive, and may present opportunities for a builder to partner with a local utility on the ownership and development of solar projects. Installations owned by commercial entities also benefit from an accelerated depreciation schedule and an additional 50 percent bonus depreciation through the end of 2009, presenting the possibility of third-party financing and ownership of solar projects on commercial or residential properties.

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Projects in Low-Income Areas Mixed-use (80 percent or less residential) or commercial projects located in certain low-income census tracts may qualify for belowmarket financing under a New Markets tax credit financing structure.

The below-market rate loans may be applied to the entire project or the solar power component of a project. This tax credit typically results in below-market rate, interest-only loans for seven years, sometimes with partial loan forgiveness. ARRTA increased the allocations to this program. Additionally, some of the $61 million Maryland has received under the stimulus bill for weatherization and low-income energy programs may be available to help increase energy efficiency for low-income residents, helping to offset the costs of installing this equipment in a new or refurbished project.

Conclusion Because of the myriad of federal, state and local incentives available to solar and other energy improvements and the potential for alternative financing options, it is vital, especially in the current market, to evaluate whether the installation of these systems will enhance the value of a proposed project.

Darin Lowder is Associate, Energy and Project Finance Group of Ballard Spahr Andrews & Ingersoll LLP and Shelah F. Lynn is Of Counsel, Real Estate Group of Ballard Spahr Andrews & Ingersoll LLP.

BUILDING IN MARYLAND AND WASHINGTON, DC

The Engineer’s Angle Residential Green Building Standards – LEED vs. ANSI

By Sean Davis, Morris & Ritchie Associates

G

reen is here to stay. This is not a passing fad. In almost every conversation regarding development, “green” is raised. One cannot pick up a magazine or trade journal without running across more than one article and multiple advertisements about green standards and products.

For the last several years, the focus has been on non-residential vertical construction. Now, at one of the most difficult times in the history of our industry, the target is squarely on the homebuilder. One’s personal or professional opinion regarding this subject is no longer relevant – we must incorporate green into our communities and our homes in order to survive and prosper.

The path to green is not clear. There are multiple standards that can be applied to determine if your home is green. So which path should one take? What “certification” should you pursue? And finally, what does the future hold for our industry, and how can we help shape its requirements?

Two rating systems have risen to the top for the single family detached and single family attached (town home) builder to consider, LEED for Homes and the National Green Building Standards ICC 700 – 2008 (a.k.a. the ANSI or American National Standards Institute Standard).

LEED for Homes went through an exhaustive development and review process by a cadre of experts and became effective in January 2008.

There are eight categories to consider: Innovations & Design Process; Locations & Linkages; Sustainable Sites; Water Efficiency; Energy & Atmosphere; Materials & Resources; Indoor Environmental Quality; and Education & Awareness. There are a total of 136 “points” available in these eight categories. To become “certified,” one needs to garner 45 points. The more points above 45, the higher the certification. Plans and construction must be evaluated by a LEED for Home Provider. A list of Providers and a wealth of information is contained on the U.S. Green Building Council’s Website at www.usgbc.org/leed/homes.

The ANSI Standard is new. The National Association of Homebuilders, in conjunction with the American National Standards Institute and the International Code Council, worked on this Standard for several years.

NAHB’s Green Building Guidelines, in use since 2005, were the starting point for the Standard that was adopted in January 2009. Homes are judged in six categories: Lot Design, Preparation and Development; Resource Efficiency; Energy Efficiency; Water Efficiency; Indoor Environmental Quality; and Operation, Maintenance and Building Owner Education. Additional points are given based on local criteria. In addition, there are mandatory requirements that must be met. There is a point system, similar to LEED for Homes, which ranges from 222 to 697. NAHB Research Center trained Verifiers review and rate homes for designation under the ANSI Standard. To understand the ANSI Standard in greater detail, visit NAHB’s website at www.nahbgreem.com.

Both programs cost money and require time to review and approve a home. There has been criticism of the LEED program’s cost and timing. This is in part due to the overwhelming number of applications for designation. The ANSI Standard is new, and only time will tell how costs and timing compare to the LEED program.

It is essential that one of these two programs becomes the standard for the homebuilding industry. Otherwise, there will always be uncertainty as to what is the appropriate–or best–standard. Homebuilding is different from other vertical construction. Yes, there are similar trades and building materials, but a home is different from a retail center, or an office, or an institutional building. The NAHB has embraced and advocated for the homebuilding industry since its inception. As green products and techniques evolve, the NAHB will be in the best position to understand how to apply these standards within the homebuilding industry. In addition, the NAHB will be in the best position to monitor both the overall system (from a national perspective) and local programs (from Home Builder Associations such as MNCBIA) over time. For these reasons, and more, the ANSI standards could become the industry benchmark Finally, it is important to point out that the USGBC is currently promulgating the LEED Neighborhood Design Standard. The draft can be found on the USGBC’s Website. Homebuilders (and their affiliated HBAs) should carefully review this Standard, as it will become effective soon. Although it primarily governs community design, its impact on homebuilders will be felt at local planning commissions or county/city council hearings.

Homes are always part of a larger community.

Sean Davis is a Principal at Morris & Ritchie Associates, an affiliate of Geo-Technology Associates, Inc. He can be contacted at sdavis@ mragta.com.

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MNCBIA Membership STARS Club GOLD

SILVER

BRONZE

Ballard Spahr Andrews & Ingersoll LLP BB&T DGG-MC Linowes & Blocher, LLP PEPCO Pleasants Development Rodgers Consulting

Acacia Federal Savings Bank Georgetown Insurance Service, Inc. Greenhorne & O’Mara Inc. K. Hovnanian Homes Loiederman Soltesz Associates, Inc. McMillan Metro P.C. Miles & Stockbridge P.C.

Bank of America Elm Street Development Gutschick Little & Weber, P.A. Holland & Knight Lerch, Early & Brewer, Chtd.

O’Malley Miles Nylen & Gilmore Provident Bank Reznick Group P.C. Sandy Spring Bank Winchester Homes

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407247 Bowman Consulting 1/2v 4c

civil engineering I landscape architecture I planning surveying I environmental I geothermal

Annapolis 410.224.7590 Rockville 301.519.8999 www.bowmanconsulting.com

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11/13/08 11:44:41 PM

Beers + Cutler Bowman Consulting Bozzuto Group Burgess & Niple, Inc. Charles P. Johnson & Associates christopher consultants ltd.

The Columbia Bank Craftmark Homes Dewberry Ben Dyer Associates, Inc. Fraser Forbes Company, LLC Furey, Doolan & Abell, LLP GE Appliances IDI-MD, Inc. Kim Engineering Macris, Hendricks & Glascock, P.A. Mid-Atlantic Builders, Inc. Military Veterans Miller and Smith Homes Porten Homes Shulman, Rogers, Gandal, Pordy & Ecker, P.A. Slenker Communities Terra Verde Communities LLC The Magruder Companies Ward & Klein Washington Gas

MNCBIA Membership Members in the News Bowman Consulting Group, Ltd. named Justin Mahlmann, PE the Managing Director of Bowman Geothermal. Mr. Mahlmann, who came to Bowman Consulting eight years ago, has more than 15 years of engineering experience, was the branch manager of Bowman’s Prince William, VA, office, as well as regional vice president. He has a Civil Engineering degree from the University of Virginia and is a registered professional engineer in the Commonwealth of Virginia.

Loiederman Soltesz Associates, Inc., was ranked by Engineering News-Record (ENR) among the top 500 design firms in the nation. The firm was ranked number 382 and was one of only a handful of Washington, DC, area engineering firms to make the list.

O’Malley, Miles, Nylen & Gilmore, P.A., announced that Managing Director, John P. Davey, and Land Use Practice Group Leader, William M. Shipp, have earned national Leadership in Energy and Environmental Design (LEED) Accredited Professional status from the United States Green Building Council Certification Institute (GBCI).

According to GBCI’s LEED Accredited Professional Directory, these two attorneys are the first legal professionals in Prince George’s County to achieve this status and join a very small cadre of lawyers in the Washington Metropolitan Area who are specially qualified to assist clients interested in carrying out development projects aimed at achieving certification according to the LEED Green Building Rating System in five key areas: sustainable site development, water savings, energy efficiency, materials selection, and indoor environmental quality.

Gregory Steve Proctor, president and CEO of G.S. Proctor & Associates Inc. and an MNCBIA board member, was named one of the 2009 Minority Business Leaders by the Washington Business Journal out of more than 100 nominations. The awards celebrate our region’s diversity by honoring some of our most inspiring leaders.

Rodgers Consulting announced that Jennifer Russel, Dusty Rood and Peter Fosselman were named principals of the 52-year-old firm. Ms. Russel leads the Planning Studio with an emphasis on design excellence.

She is recognized for her expertise and experience in New Urbanism, infill development and mixed-use projects with a focus on knowledge-based issues related to the regulatory environment. With extensive experience in the public sector, Jennifer has overseen land use and development activity review and approvals, and master planning activities in suburban Maryland. Mr. Rood is the leader of the firm’s Environmental Group. He is a well-known expert witness on environmental matters and has been instrumental in framing the local building industry’s positions on environmental policies due to his thorough understanding of the regulatory process.

Mr. Fosselman has 20 years of land planning experience in the public and private sectors. He has strong strategic linkages to state and local municipal officials and civic activists. He also serves on the Maryland Municipal League (MML) Legislative Committee. Prior to joining Rodgers, he was a zoning inspector, overseeing construction activity and assisting with draft legislation in the historic preservation and environmental arenas.

SK&I Architectural Design Group welcomed Jon Wallenmeyer, AIA as a Principal. With more than 25 years of professional experience in architecture and development, Mr. Wallenmeyer is recognized as a veteran of the real estate industry. He was formerly vice president of development at Forest City. He has extensive expertise in adaptive reuse as well as new construction. Prior to his work with Forest City, Mr. Wallenmeyer was a practicing architect specializing in high-rise residential projects for 12 years in the Washington, DC market.

MNCBIA’s Most Wanted List Listed here are firms whose membership in MNCBIA has lapsed. WE WANT THEM BACK! Please encourage these companies to reinstate their membership in MNCBIA. Advanced Civil Design, All Temp Heating & A/C Inc, C.O. Carpentry, Inc., Caldeira Quality, Carl Freeman Assoc Inc, Counselors Title, LLC, Curtis Development Corp., Designs Of The Times, EquityRGThe Residence Company, Essex South Builders, Inc., Freedom First Homes, LLC, General Shale Brick Company, International Tile & Marble, Kishimoto.Gordon.Dalaya PC, Long & Foster/New Homecondo., My Pest Control Company, Inc., Orion Systems Group, Parrott Security, Perfect Fit Custom Shutters, Quiza Management, LLC, RDA Engineering Co., Rockville Fuel & Feed Co Inc, Sack Harris & Martin, P.c., Sage Title Group, LLC, Shelter Systems Ltd, Smith Design/Construction, Inc., Sport Systems, Inc, Stock Building Supply, Susquehanna Bank, TLC Custom Lawn Sprinklers, Inc., USI DC Metro, W T Sandy Contracting Inc., Washington Mgt. & Dev. Co., Inc., WES Construction, Inc.

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JULY/AUGUST 2009 12:54:46 17 PM 11/20/08

MNCBIA Membership New Members (as of May 1, 2009)

BUILDERS Archstone Building Multifamily Rob Seldin Ph: 703-399-3532 rseldin@archstonemail.com

The Donohoe Companies, Inc. Commercial Building Peter Gartlan Ph: 202-333-0880 peterg@donohoe.com

ASSOCIATES

Centennial Street Development Development Edwin Kelly Ph: 240-776-4574 ekelly@centennialstreetdevelopment.com Sponsor: Tom Farasy Home Properties Building Multifamily Donald Hague Ph: 703-370-7363 donaldha@homeproperties.com Sponsor: Roger Winston

1st Mariner Bank Mortgage Banking Karen Radisch Ph: 410-266-0002 kradisch@1stmarinerbank.com Sponsor: Michael Faerber Ameritel Office Machines John Smith Ph: 301-251-0222 Sponsor: Tom Farasy

ADVERTISER.COM Appliance Distributors Unlimited ........................ www.adu.com ......................Inside Back Cover Bowman Consulting Group, Ltd .............. www.bowmanconsulting.com.................................. 16 C V Security Inc. .............................................. www.cvsecurity.com .................Inside Back Cover GE Appliances........................................................ www.ge.com ....................Outside Back Cover Linowes and Blocher LLP ..............................www.linowes-law.com ........................................17 Long Fence Company Inc. .............................. www.longfence.com ........................................... 4 Macris Hendricks & Glascock, PA .................... www.mhgpa.com ............................................15 Pepco Services Inc......................................www.pepco-services.com ............ Inside Front Cover Provident Bank .................................................www.provbank.com ........................................... 6 Shulman, Rogers, Gandal, Pordy & Ecker, P.A.................... www.shulmanrogers.com ....................................... 4 Vintage Security .......................................... www.vintagesecurity.com....................................... 3

INDEX OF ADVERTISERS APPLIANCES Appliance Distributors Unlimited .....Inside Back Cover GE Appliances ..................Outside Back Cover ATTORNEYS Linowes and Blocher LLP ........................... 17 Shulman, Rogers, Gandal, Pordy & Ecker, P.A. ..................... 4 AUDIO/VIDEO C V Security Inc. ..................Inside Back Cover ENGINEERING Macris Hendricks & Glascock, PA ............... 15

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FENCING Long Fence Company Inc. ............................ 4 FINANCIAL INSTITUTIONS Provident Bank ............................................. 6 SECURITY SYSTEMS Vintage Security ........................................... 3 SURVEYORS Bowman Consulting Group, Ltd .................. 16 UTILITIES Pepco Services Inc. ............ Inside Front Cover

BUILDING IN MARYLAND AND WASHINGTON, DC

Butler Window & Door Windows & Doors Jermey Butler Ph: 540-931-5875 Sponsor: Josh Rosenthal C. W. Dukes, Inc. Investments Charles Dukes Ph: 703-719-2511 Fine Earth Landscapes, Inc. Landscape Contractors Joel Hefner Ph: 301-972-8810 joel@fineearth.com Sponsor: Carter Willson Fire Tech Sprinkler Systems Dileepa Jayasuriya Ph: 240-750-0487 dj@firetechco.com Sponsor: Marc Rose Galliner & Huguely Associates, Inc. Building Materials Geoffrey Huguely Ph: 202-723-1000 ghuguely@aol.com J. Martin Carpentry Remodeling Drywall Contractors J. Martin Oliva Ph: 301-602-6591 jmartinremodeling@msn.com Sponsor: Marc Rose Kitchen & Bath Creations Cabinets-Custom & Prefinished Noel Dalton Ph: 410-772-3240 ndalton@kbcdirect.net Logan Yumkas Vidmar & Sweeney, LLC Attorneys James Vidmar Ph: 443-569-5977 jvidmar@loganyumkas.com Sponsor: Marty Mitchell Real Estate America Real Estate Brokers Sergio Morgadinho Ph: 301-840-2288 Sergio@real-estateamerica.com Sponsor: Michael Faerber

introducing Meet HomeShare™ home system - a very big idea in the enjoyment of your home. It’s Sony’s multiroom entertainment solution that will keep everyone entertained, wherever they are in the home. High definition video in any room. Access to your iPod® music throughout the house. An intercom so you can call the kids down for dinner without ever raising your voice. Access a security camera that lets you see who’s at the front door from the master bath. All at the touch of a button. All in perfect balance.

Whether installed in the living room, kitchen or bedroom, HomeShare™ delivers your entertainment needs and enhances the way you live throughout your home. It’s never been easier to enjoy all your music and video, wherever you are in the home!

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5/1/09 7:55:19 AM

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