Prevailing Wages and Worker Classification Problems

Does the Responsible Public Developer conduct investigations to determine whether workers are accurately classified and fully paid?

Yes, but the process is costly to everyone involved: the owner, contractor, the subcontractors and laborers. Here's why.

Prevailing wage law, both Federal (the Davis-Bacon Act, 40 U.S.C. 276a) and State (RCW 39.12) provide that prevailing wages will be paid to workers under rates established by job location (county) and by worker trade classification (carpenter, painter, laborer, etc.).  In Washington State the rates are published and updated by the Department of Labor and Industries.  The owner and DOL also conduct audits to determine whether workers who are laborers are also performing work that falls under the definition of another higher paid classification.  This is called classification jumping and it can be intentional or accidental.  Fines accompany intentional classification jumping, and in the worst case, a contractor who repeatedly and/or falsely underpays workers can be barred from public works (debarment).

When a public owner has reason to think classification jumping may have occurred, it will examine payment application and time cards, and conduct worker interviews to determine what specific tasks they performed on a given day, and the total hours worked on each day for each task.  The owner will then compare the results to the actual payment records for those workers.  A violation may be found where a laborer doing site clean up also spent time assisting other skilled workers but was not paid the higher of the two classification rates.

To get to this point, the owner will have incurred the costs of the persons conducting the audit, the cost of interpreters, the cost of conferring with legal counsel and possible delay depending on the stage of the project.

The general contractor will have incurred the costs of withheld retainage to cover any additional payment due to workers, time spent participating in the audit and the cost of their own counsel.  The costs of an owner broadly reclassifying significant laborer hours to carpenter hours on a large project can be devastating to the general and their subcontractor.

The subcontractor may have the most exposure, especially where it owes broad indemnity obligations to the general contractor. If the process is contested, then the DOL will make a final determination.  The general contractor may also pass through to its subcontractor the costs to litigate, seek reconsideration or review.

Then there is the cost to the workers, even if they end up being paid at a higher wage.  What they incur is the time away from work being interviewed by the owner, DOL and being called to testify about any lost wages. They also risk that their employer may not be in a position to hire them on other projects.

To avoid the entire audit process and the potentially huge costs, best efforts should be made by construction professionals to keep excellent records, perform self audits to ensure all workers are accurately classified and worked only the appropriate hours, were fully paid and were not allowed to perform work that places them in higher wage classifications. Do this, and owners and the DOL should have little reason to investigate.

Good Sam Puyallup awarded LEED Gold

 

 Does the Responsible Developer aspire to LEED for health care facilities?

Local Washington cities and health care providers say, Yes!

The latest addition to Puyallup’s MultiCare Good Samaritan Hospital, the nine-story, $300-million Dally Tower, has received the Green Building Institute’s LEED Gold award.

The hospital tower, which doubled the space at Good Samaritan, is the state’s first hospital structure to win the Gold award for energy and resources conservation, said Tacoma’s MultiCare Health System, the hospital’s parent company.

The gold award was based on the new building’s water and energy saving features and environment-friendly construction methods.  The building and parking structure replaced surface parking lots and a public street, and also replaced impervious surfaces with permeable green space. The structures added no new impacts to the stormwater system.

Other sustainable features include:

• Ecoroofs, bioswales and rain gardens that gather stormwater runoff.

• An energy-efficient building form that minimizes east-west exposure; sun shades on the windows to reduce heat gain.

• Renewable, recycled and regionally sourced materials; certified wood, low-VOC interior finishes and linoleum and rubber flooring.

• Reduction of potable water use by 20 percent compared with a normal hospital.

• HVAC system with low-velocity ducting, high-efficiency chillers and mid-building air handlers.

• Air drawn 100 percent from outside the building to help control infections, and a heat-recovery system to conserve energy.

The architect for the project was the Good Sam Design Collaborative which included Clark/Kjos Architects and GBJ Architecture. Skanska USA was the general contractor.

Another area hospital serving southeast King and northeast Pierce counties, Enumclaw’s St. Elizabeth Hospital, last summer was awarded a LEED Silver designation. St. Elizabeth is owned by Tacoma’s Franciscan Health System.

So to sum up the attributes of Green hospitals, its good for the environment, it saves energy and reduces costs, it's also gorgeous, and, it's undeniably healthy (see new USGBCCleanMed protocol).  

Seattle Bites the Green Bullitt

 

At the end of last month, the City of Seattle broke ground on The Bullitt Center, located at 1501 East Madison Street, which is touted to be the greenest commercial building...in the world. 

Seattle Mayor Mike McGinn claimed the $30 million Bullitt Center project will create green jobs on every level, the 94 jobs for the construction workers who will receive green building training on-site, the future 141 permanent jobs for employees in the building and the people in the green building industry who will teach classes and receive green building certificates at the project’s Center for Energy and Urban Ecology.

So Seattle voters, in recession, new jobs are good but is this project just another green monument that may prove to be a drain on taxpayers?  

No, says the Mayor and the Bullitt Foundation.  The new Bullitt Center will be taking net zero building trends to new heights.  This six story tall, 52,000 square-foot office building is designed to be both a net-zero energy building and a net-zero water building while managing all of its own waste needs.  It will produce as much energy as it consumes, provide all of its own water, and process all of its own sewage.  It will also use only 1/3 as much energy as an average, similar-sized building – or half as much as a certified LEED platinum building!
 
Achieving these goals may not be an easy feat but if successful, will make the building much more affordable to operate.  Some of the green technologies used in the building include: 
  • A triple-glazed curtain wall system
  • Windows that open and close automatically depending on outside conditions
  • A closed-loop geothermal system
  • Radiant floor heating and cooling
  • Extensive daylighting thanks, in part, to taller than average ceilings and windows
  • Rooftop solar system designed to generate 100 percent of the building’s energy needs
The green tax dollar savings allegedly won't stop after construction is complete.  Tenants in the building will be required to use electronics that are extremely energy efficient and are designed to automatically shut down at night.  Although this sounds like a Machiavellian requirement for tenants to meet, four of the six floors have already been rented out.
 
If the project delivers the expected performance ratings, then kudos will be in the offing to the design and construction team behind this premier green building project, the Miller Hull Partnership, Point32, Schuchart Construction and PAE Consulting Engineers.
 
The project's success would probably be good for the Mayor's performance rating too! 

How Green Is My City?

Does the Responsible Municipal Developer and its citizens aspire to be the "Greenest?" 

Absolutely and the competition is fierce, as it should be, after all it's a matter of civic pride!

 

Our blog has showcased the many laudable efforts of local and state governments, citizens and private developers to implement green and sustainable development practices (the preservation of open spaces; control and capture of storm and rain water; energy savings; green electric highways; reclamation of brown fields and the construction of passive homes).

    

So how does our Emerald City compare to other great cities?  Well that depends on the source. 

We looked for objectivity and think we found it in Siemens Global's US and Canada Green City Index  (which was also cited by Time.com).  Siemens' rating was based on some fairly broad comprehensive objectives and methodology.

 

The objective criteria was to measure and compare the performance of 27 major US and Canadian cities, based on their commitment to reduce their future environmental impacts.  The goal of the index was to allow a comparison of cities against their peers and to study innovative projects which other cities may want to follow.

 

The methodology was based on the work of other Green City index sites (global) and included 31 quantitative and qualitative indicators in nine categories: CO2; energy; land use; buildings; transport; water; waste; air and environmental governance.

 

Based on the criteria and the fact the study included Canada, we should be proud that Seattle was #4 with a score of 79.10.  Our score was heavily based on the fact Seattle had set, and met, many environmental goals over the last 10 years and Seattle ranked #1 in the buildings category because it was among the first cities to mandate LEED-certification for municipal building projects.

 

The City of Seattle has done a fantastic job of setting goals and obtaining the necessary commitments from its citizens to create green and sustainable projects and communities.  Seattle's ranking was no accident but was a result of a great vision and a lot of hard work and expense.

 

Seattle is a great place to live and work and we can all be proud of this ranking.  

 

Wind Wars Episode I-PNW Energy Companies v. BPA

Does the Responsible Developer avoid conflicts in Renewable Energy Production that could lead to litigation?  Apparently not all of the time.

At the end of last month we reported the Bonneville Power Administration's ("BPA") decisions to allow more water to be spilled over dams and to shut down many wind turbines.  We speculated that the decision would create conflicts that could lead to litigation.  And so it has, the Wind Wars have begun.

A coalition of five PNW energy companies (Iberdrola Renewables, PacifiCorp, NextEra Energy Resources, Horizon Wind Energy and Invenergy have filed a one hundred and thirteen page complaint with the Federal Energy Regulatory Commission ("FERC").  The coalition claims to have invested $6 billion in renewable energy generation in the region.  The coalition is howling mad and alleges that BPA violated the Federal Power Act by using its control of the region's power grid to breach its contracts and seize transmission rights. 

The American Wind Energy Association ("AWEA") also filed a motion to intervene with comments in support of the coalition, decrying BPA's alleged acts as discriminatory in favor of its own interests, and further voicing its support for the energy companies' allegations.  

"BPA is using its control of the region's transmission system and exploiting unusually high water levels to break contracts," said Rob Gramlich, senior vice president for public policy at the AWEA and former FERC policy advisor. "Contracts cannot be broken for wind or anything else.  BPA, a government-owned monopoly, cannot play by different rules and shred contracts with private companies. FERC can rise above the politics and adjudicate based on facts and the law".

According to BPA's newsroom it was aghast that the complaint had been filed.  BPA spokesman Mike Hansen stated "We are disappointed that this filing has proceeded as we are participating in mediation sponsored by FERC that we believe is worthy of effort". 

BPA also argues the complaint is overblown because the BPA already has authority to limit wind generation, particularly during periods of overgeneration. “We have the legal authority to implement the Environmental Redispatch policy and, in addition to that, we believe our transmission contracts also give us the legal authority to limit generation,” stated Hansen.

BPA's position is unlikely to keep it out of the courts or away from an expensive and protracted  battle at FERC.  Other Northwest energy companies are expected to blast these and other BPA policies in the Ninth District Circuit Court of Appeals by alleging BPA actions are in violation of the Northwest Power Act.  Individual companies and utilities may also file actions to recover losses from BPA for its actions this spring in the U.S. Court of Federal Claims.

 

Stay tuned, this is a major, reoccurring conflict with very high stakes.  Anticipate it may take a long time for the wind wars to blow over. 

 

When Green Conflicts: Wind vs. Water

 

Do Responsible Developers anticipate that Green Energy will create conflicts?

Yes, but unfortunately those conflicts may not be easily resolved.  Here's a timely example.

If you have recently driven over I-90 into Kittitas County and crossed over the Columbia River down past Wanapum Dam, you probably noted two interesting things.  First, many of the wind turbines have been shut down and two, enormous amounts of water are being released from Wanapum and other dams.

As a resident of the Pacific NW you probably also know that spring is when dams and wind turbines generate the most power, providing a huge increase in available power to businesses and consumers, a great economic benefit. 

In a year like 2011 where the PNW has very high precipitation (snowpack) it can be anticipated that the increased runoff may result in two decisions by public utility operators like the Bonnevillle Power Administration that may result in decreased economic benefits to some.  The first decision is to prevent flooding by allowing more water to be spilled over the dams. The second decision is that due to abundant electrical power, wind turbines may be temporarily shut down.

Either decision may also have at least two unfortunate economic costs.  One, huge spills of water over dams can increase dissolved oxygen levels in the surface water below dams, killing young salmon and pen raised fish that cannot escape by moving into deeper water with more oxygen.  Second, the available surplus of hydroelectric power may trigger a decision to shut down wind turbines which in turn, shuts off the flow of revenue and tax incentives.

The first decision to release water earlier this month has reportedly resulted in massive fish kills on the Columbia.  Killing fish always incurs the wrath of sportfishing consumers and commercial fish farm operators.  According to a Seattle Times report the loss in revenue to fish farms alone in 2011 may run into the tens of millions.  

The second decision has incurred the wrath of the American Wind Energy Association.  Rob Gramlich, the Senior Vice President for Public Policy, recently stated that "No one is above the law and no one can break contracts as Bonneville has.  Commerce can't exist without contract sanctity. This will have a chilling effect on investment.  There's a better way.  I think there's a preference for keeping certain types of generation running and to benefit certain customers and not others.  If you do the math, you can see we’re into the millions already in damages and we’ll be moving into the tens of millions of dollars.  I believe we will see legal action very soon."

So to avoid these seasonal and therefore reasonably foreseeable Green Energy conflicts, is there a middle ground to avoid  "power struggles" costing millions in damages and millions more in the form of protracted court battles?  Hopefully, yes.  The parties may use information in the 2007 Northwest Wind Integration Action Plan and seek guidance from the BPA, the Department of Energy, the Obama administration and other public and private actors that can work toward reconciliation of these and other energy conflicts.   

It is the responsible thing to do.

 

Proving Green=Energy Savings

 

Does the Responsible Developer need to track Green energy savings?

Absolutely, whether voluntary or mandatory, it is your best interest as the Responsible Developer because it means you are saving money or at least offsetting the cost of the money you spent on all that Green energy saving technology.  If can also show you that your building performs better which makes it more attractive to tenants and prospective buyers!

If tracking energy use is voluntary, you still need to do it as part of good risk management.  You need to at least track performance before any applicable warranties have ran, because monitoring will tell you if actual performance is within the guarantees, warranties or performance specifications for your building.  If before that time energy use and cost are unexpectedly high it may indicate you have a problem that needs to be immediately investigated.  While there is probably a contract requirement for you to timely notify the applicable design professionals and contractors, it is always a good idea to consider hiring a unbiased and objective energy use audit consultant (link is a sample reference only there are many available locally).  This becomes critical when, in the face of well documented sub-par energy performance, your project team is doggedly representing that all is as it should be.

If tracking energy use is mandatory (yes many state and federal authorities are requiring mandatory production of records showing energy consumption) then you have no choice. 

Locally, as of today, May 12, the City of Seattle's Department of Planning and Development is requiring that 800 commercial property owners of non-residential buildings over 50,000 sq. ft. must start tracking energy use and must report on October 3, 2011.  Then, for both non-residential and and multifamily residential buildings over 10,000 sq. ft., annual reporting begins on April 1, 2012 (no not a belated April Fools joke). 

These effected property owners must employ use of the EPA's Energy Star Portfolio Manager that is used to set "energy use benchmarks".  This energy information must then be provided to the parties in real estate transactions (buyers, tenants and lenders).

So with this information becoming generally available to players in the RE market,  this new "energy bench marking" is expected to be used by local RE agents to help owners see where they stand in the market and how competitive their building(s) are regarding energy use.  Kidder Mathews was already working with its clients to do this voluntarily and has not had much push back from owners.

So again, whether mandatory or not, spending money on tracking the energy performance of your buildings means businesses and consumers that value green built will be willing to pay more, if you have empirical proof of performance.     

Why Developers Should Track All Warranty Claims

 

Does the Responsible Developer track all warranty claims?  Absolutely, it is just good business!

It is axiomatic that when a development project is complete that there are a number of warranties that must be tracked and managed as part of the post project completion entitlements and obligations.  This risk management process applies to all projects, public and private, and depending on who you are in the project hierarchy, it is a continuation of the project financial analysis.

Yet many parties to the project myopically focus solely on the contractual written warranty period, which typically is one year.  The Responsible Developer, however, tracks all relevant warranty periods including those express and implied at law warranties.  Why?  Because anything less may just be throwing money away.  Who can afford to do that in these challenging economic times?  

The actual process is relatively simple.  Once a project achieves substantial completion, the following warranties should be calendared and tracked:

1.  90 days prior to expiration of contractor's 1 year warranty.

2.  90 days prior to expiration of any manufacturers' warranties.

3.  180 days prior to expiration of all (3,4 and 6 year) contract statutes of limitation and repose.

The reason you calendar these dates is so that you can inspect and test the work, materials and systems in your project for any premature failures or damage and give your self enough time to document it and provide that written information to the party the owes you the warranty obligation-before that party is immune from suit.

Some public developers may be less concerned about the expiration of statutes of limitation because Washington law provides that where the work was for the benefit of the state the six year statute of limitations does not apply.  A public entity, however cannot afford to rest on that laurel too long, because many contractors are either corporations or limited liability companies that after the project may become dissolved and immune from suit.  While there are artful ways to draft around such future warranty impediments in the contract, developers can easily monitor the status of their contractor's legal status by using the information maintained by the Washington Secretary of State and Labor and Industries.

The reason you as the Responsible Developer need to make this effort is so that in the event a post completion inspection reveals latent defects in a product or work, you will be able to timely make a claim and either obtain repairs, insurance money or both.  If you fail to calendar these dates or make the effort, then you may just be throwing money away.  Imagine being asked by tax payers or investors why no one had the foresight to include this analysis as part of your project.

Well now you know what the Responsible Developer does as an integral part of maximizing the value of all of the warranties it may be a beneficiary of.

Green Building Means Green Infrastructure

Do Responsible Public and Private Owners incorporate Green, Sustainable components into infrastructure to better manage stormwater?  Absolutely, and locally we have some excellent examples.

First here's the concern, as eloquently expressed by a member of the American Association of American Geographers ("AAG") as part of an annual meeting being held in Seattle this week:  

"America's water infrastructure is in crisis.  Nationwide, conventional urban and exurban storm water management systems increasingly require extensive replacement and repair, leaving residents susceptible to flooding, infrastructure breakdowns, and contamination risk.  However, estimated stormwater systems rehabilitation costs run in the billions, an expense that many municipalities are unable to meet. To address this problem, officials in several U.S. and international cites are increasingly turning to an urban design based alternative, termed green infrastructure to to supplement conventional surface and subsurface drainage systems."

 King County has made just such a proposal for the Barton Basin area.  KC plans to design and build "green stormwater infrastructure" ("GSI") to control combined sewer overflows.  The GSI project will consist of planted areas call "rain gardens" between sidewalks, curbs and others areas in several locations in West Seattle.  This is the first "green" project KC Wastewater will implement.  The goal is to have these rain gardens trap millions of gallons of water a day that would otherwise enter the combined sewer system.  

Seattle Public Utilities is also heavily promoting the use of what it call Natural Drainage Systems projects ("NDS").  These systems also rely on open spaces of trees, smaller plantings, swales, soils and small wetlands to absorb water and filter out contaminants like oil, paint, fertilizers and heavy metals-before those contaminants reach our lakes, streams and Puget Sound. 

For you bloggers who may be homeowners and green do-it-yourselfers, SPU also has another link for called "Residential Rainwise Program" that encourages the use of landscape designs that incorporate the use of cisterns, rock filled trenches, grass strips, rain gardens and use of porous pavers (instead concrete or asphalt).  The Department of Ecology has a great guide for protecting waterways entitled "Protecting Aquatic Ecosystems."

In case promotion of green infrastructure in recession may not sell with some voters, perhaps some negative reinforcement may help.  For a really disastrous local example of what can happen when too much contaminated stormwater and wastewater enter our waterways, take them on a drive to lower Hood Canal on a gorgeous late summer day.  Go for a walk on the beach.  If the timing is right, they may see the red algae bloom in the otherwise blue water and the dead sea life littering the shoreline.

A sad but poignant reminder why all public and private owners need to work together to fund the protection of our priceless waterways. It is the responsible thing to do.     

 

The Right Time To Develop Green Highways?

DRIVEN TO BE GREEN

Despite national, state and local budget woes, should the Responsible Developer pour more money into green sustainable transportation?

The US Departments of Commerce and Energy, along with the Washington Departments of Commerce and Transportation, say YES!

Given the civil unrest in North Africa and the Middle East and concern for disruption in the flow of oil, record high retail gas prices are predicted for this summer.  There may not be a better time to own a Chevy Volt, Ford Focus, Nissan Leaf (or if you are rich, see above) a Tesla Model S, or other all electric car.  The problem is, on a long drive, where do you stop to "fill" up? 

As you may recall in 2010 the DOC awarded the State of Washington $1.3 million for a series of electric car charging stations on I-5, in part to implement the nation's first "electric highway", a 1350 mile strip starting in Mexico and ending in Canada.  This is known as the "West Coast Green Highway."  

WSDOT also expects to create another section of green highway by the end of this summer, the Stevens Pass Electric Vehicle Highway.  WSDOT is holding two meetings to provide more information and to help local partners prepare for alternative fuels.  The meeting will be held on March 8th in Leavenworth and March 9th in Sultan

General Electric is also sponsoring a local event to promote "EVs" (electric vehicles).  The GE EV Experience Tour will be held on March 15th in Seattle, at the Experience Music Project.  The workshop will include technical and business tracks for developing EC Ecosystems, strategies and facilities.  Also, you Responsible Developers, heads up, GE is also looking to partner with public and private owners, property managers, electrical contractors and commercial and residential builders. 

While you are there you can even test drive some of GE's EV fleet vehicles (sorry no Teslas).

Still, imagine the day when you are cruising along I-5, for work or pleasure, where there is less engine noise, less exhaust fumes and when you stop to "fill up" your EV, your hands do not smell like gasoline and the only money you spend is in the EV convenience store....on health food.  Kidding, it's likely junk food will still be sold too, because no matter how driven we are, we're still Americans. 

 

Court Dismisses Challenges to Washington's Revised Energy Code

On February 7, 2011, Judge Bryan dismissed the Building Industry Association of Washington’s (“BIAW”) claims that certain newly enacted provisions of the Washington State Energy Code are preempted by federal law. The Washington State Building Code Council (the “Council”) promulgated the revisions, contained in WAC 51-11-0900 (“Chapter 9”), in order to comply with its statutory requirement to achieve a 15 percent reduction in annual net energy consumption in new construction, and originally set the effective date as July 1, 2010.   As we previously reported, BIAW filed suit in federal court in the western district of Washington on May 25, 2010, seeking an injunction and a declaratory judgment that Chapter 9 violated the Energy Policy and Conservation Act of 1975 (“EPCA”).

The main basis of BIAW’s claims was that Chapter 9 was preempted by EPCA, and therefore invalid. EPCA, as amended, set federal energy efficiency standards for certain "covered products, including heating, ventilating, and air conditioning equipment (“HVAC”) and water heaters, as part of its energy conservation program.  (EPCA is responsible for the familiar bright yellow energy conservation guides you see on new major appliances for sale in retail stores.)

As reported in one of our prior blogs, in a June 8, 2010 letter to the Council, Governor Chris Gregoire asked the Council to delay implementation of the revisions until April 1, 2011, for fear of further delaying the construction industry’s recovery from the recession. The Council did in fact delay the effective date to January 1, 2011.

BIAW had joined with various industry groups to bring their claims, and the NW Energy Coalition, Sierra Club, and others were allowed to intervene for the Council. Both sides brought summary judgment motions. EPCA expressly states that it preempts any state regulations concerning the energy efficiency of “covered products”, but did provide for exceptions, if a state code complied with seven specific requirements. The Council argued Chapter 9 fell within the exceptions, BIAW argued it did not.

In his 23 page opinion, Judge Bryan carefully analyzed each of the contested exceptions and, referring to a combination of legislative history, expert testimony, and computer simulations, found that Chapter 9 passed muster. Judge Bryan granted the Council’s summary judgment motion, denied BIAW’s motion, and dismissed the complaint.

As Washington and other state and local governments amend their energy codes to improve energy efficiency, there will likely be more challenges similar to BIAW’s.  Judge Bryan distinguished one challenge already decided in New Mexico, where a federal court granted an injunction against the City of Albuquerque’s high performance building ordinance because it was preempted by EPCA.

Washington State Supreme Court Upholds the Municipal Water Law

The Washington State Supreme Court has ruled that key provisions of the Municipal Water Law (MWL) are facially constitutional.1 The ruling affects water rights across Washington State, upholding the flexibility and certainty that the MWL provides to purveyors, municipalities, and other “municipal water suppliers.” However, the Court stressed that the ruling is limited to the “facial constitutional challenges” that were before the Court, leaving room for consideration of similar claims in the future that may be advanced under “as applied” challenges.

Under the MWL, a “municipal water supplier” has distinct legal rights that are largely unavailable to other entities that hold water rights in Washington State:

  1. A municipal water supplier’s water rights that were perfected based on system capacity (“pumps and pipes”), rather than beneficial use, are rights in “good standing.”2
  2. Municipal water suppliers may hold inchoate water rights without being subject to the state’s relinquishment statute.3
  3. Municipal water suppliers may change a water right’s place of use through water system planning.4
  4. Municipal water suppliers may expand the scope of a water right beyond the population figure in their water right document.5
  5. Municipal water suppliers may expand the scope of a water right beyond the service connection figure in their water right document.6

For the first time in state history, the MWL defined “municipal water supplier”7 and “municipal water supply purposes.”8 Specifically, the MWL defined a “municipal water supplier” as any entity that (1) provides water to 15 or more residential service connections, or (2) provides water to a nonresidential population that is, on average, at least 25 people for at least 60 days a year.9

Because the MWL retroactively applied these provisions, opponents of the MWL argued that provisions in the MWL facially violated separation of powers.10 The opponents also argued that the provisions facially violated due process under the Washington State Constitution.

The Court unanimously rejected both facial challenges. However, it is likely that the MWL’s constitutionality will be litigated again in an “as applied” challenge. As the Court noted in its opinion, one such case, Cornelius v. Dep’t of Ecology,11 has already made its way to the Washington Pollution Control Hearings Board.

While municipalities and purveyors holding “pumps and pipes” water right certificates will be encouraged by today’s ruling, an element of risk and uncertainty remains as a result of the limited scope of the legal challenges that were before the Court.

_____________________
1 Lummi Indian Nation v. State, ___ Wn.2d ___ (2010), available at:
http://www.courts.wa.gov/opinions/?fa=opinions.disp&filename=818096MAJ
2 RCW 90.03.330(3).
3 RCW 90.14.140(2)(d).
4 RCW 90.03.386(2).
5 RCW 90.03.260(5).
6 RCW 90.03.260(4).
7 RCW 90.03.015(3).
8 RCW 90.03.015(4).
9 RCW 90.03.015(3) and (4).
10 The opponents argued that the MWL’s definition of “municipal water supplier” unsettled a previous Washington State Supreme Court decision. See, Theodoradus v. Ecology, 135 Wn.2d 582, 957 P.2d 1241 (1998).
11 Cornelius v. Dep't of Ecology, No. 06-099 (Wash. Pollution Control Hr'gs Bd. Dec. 7, 2007).

Beginning a Conversation on Equitable Transit Oriented Development

Taxpayers in the Puget Sound region have invested nearly $15 billion to build up to 100 new transit centers by 2025. The transit centers and the development that accompanies the transit centers will largely shape how this region accommodates growth and encourages economic development. Previous light rail investments in South Seattle demonstrate several challenges that accompany transit investments. The Puget Sound Regional Council reports that light rail investments in South Seattle displaced local businesses and escalated land values near transit centers, thereby limiting opportunities to develop transit oriented affordable housing.1   Similar to South Seattle, many of the planned transit centers are to be located in the region’s most dense and diverse communities. This fact raises a critical planning question, how can this region encourage transit and transit oriented development without displacing established neighborhoods?

To answer that question, the federal government recently awarded a $5 million grant to a Puget Sound regional consortium2  to encourage equitable transit oriented development. With over 1,000 grant applicants, the Puget Sound region was one of 45 award recipients selected by the U.S. Department of Housing and Development (“HUD”). In all, HUD released nearly $100 million in grant funding with the goal of connecting housing with jobs, schools, and transportation. Grant insiders report that the Puget Sound region received substantial grant funding because of the grant’s emphasis on planning for equitable transit oriented development. Specifically, the $5 million grant for the Puget Sound region will fund:

  1. Neighborhood Engagement: Engage low-income and minority residents in the transportation and transit oriented development planning process. (~$500,000)
     
  2. An Affordable Housing Action Strategy: Establish an affordable housing land bank that acquires property near transit centers for affordable housing purposes.3  The strategy will also develop new land use and regulatory tools to encourage transit oriented development. (~$1,500,000)
     
  3. Transit-Corridor Planning: Establish a forum for local governments to act cooperatively, rather than competitively, to enact regional housing, transportation, and economic development goals. (~$1,000,000)
     
  4. Development Modeling: Develop a computer-modeling tool that allows planners to visualize, communicate, and analyze the cost/benefits of different development scenarios. (~$750,000)
     
  5. Pilot Projects: Enact equitable transit oriented development pilot projects in Bel-Red, Northgate, and the Tacoma Dome transit centers. ($1,000,000)
     
  6. Grant Administration ($250,000)

Responsible Development is more than achieving LEED certification. Responsible Development also requires sensitivity to neighborhood issues and a willingness to address those issues. It remains unknown whether the grant will result in a substantive regulatory framework that encourages equitable transit oriented development. Such development will require the cooperation of local governments, neighborhoods, and developers. However, the fact that eighteen project partners cooperated to secure this grant is one indicator that we should expect some substantive outcomes from this conversation.

_______________________

1 See, Puget Sound Regional Council’s Sustainable Communities Regional Planning Grant Proposal, 4-5, available here

2 Project partners include: A Regional Coalition for Housing (ARCH), the City of Bellevue, the Cascade Land Conservancy, the City of Everett, King County, King County Housing Authority, North Seattle Community College, Public Health – Seattle & King County, Puget Sound Regional Council, City of Redmond, City of Seattle, Seattle Housing Authority, City of Tacoma, Tacoma – Pierce County Heath Department, the University of Washington’s Runstad Center for Real Estate Studies, and the Urban Land Institute – Seattle District Council

3 The grant does not provide funding that capitalizes the land bank.

 

Debarred Contractor List

Part of being a responsible public owner is to ensure that the contractors bidding on your project are in good standing with the Washington Department of Labor and Industries (“L&I”). Contractors found to be in non-compliance with prevailing wage law or contractor registration law by L&I are not allowed to bid on public projects, and are referred to as “debarred.” Consequently, owners should check the debarred contractor list prior to selecting a contractor for their project. The list was recently updated and can be found at

http://www.lni.wa.gov/TradesLicensing/PrevWage/AwardingAgencies/DebarredContractors/

 

The City of Sustainability, also known as the City of Destiny

Recently, the City of Tacoma announced Sustainable Tacoma Grants, awarding up to $5,000 to any non-profit or educational institution planning a project related to sustainable development and climate change mitigation. The grant encourages applicants to “be creative!” and to connect the grant proposal to Tacoma’s Climate Action Plan. Key strategies of the action plan include transportation/fuel reduction, energy reduction, waste reduction/recycling, and smart land use/livable neighborhoods.

This grant is another concrete step that the City of Tacoma has taken to integrate sustainable principles into the City’s daily operations. Previously, the Tacoma City Council passed a comprehensive upzone for several of Tacoma’s mixed use centers. This upzone is intended to accommodate projected population growth inside the City, rather than outside the City (such as on Puyallup Valley farmland). Recognizing the City’s determination to encourage urban infill, the Washington State Department of Commerce awarded the City with a $100,000 grant to fund an upfront environmental analysis of a recently upzoned mixed use center. The upfront environmental analysis will encourage new development by removing one of the biggest barriers to infill development, that is, project-based appeals under the State Environmental Policy Act. The Responsible Developer’s Blog previously discussed the importance of “upfront SEPA.”

Of course, not all of Tacoma’s residents are excited about the idea of new (and more) neighbors. To assuage neighborhood concerns, the City is taking proactive steps to engage residents in a conversation about growth. Last month, the City sponsored a lecture titled Density, Gentrification, & Other Dirty Words. Upcoming lectures are on Sustainable Transportation and Adapting Old Buildings to New Uses. A list of upcoming lectures is available here.  The City of Tacoma’s Sustainability Calendar is available here.

Expect to see Tacoma taking a lead on urban infill in the years to come. The micro-grants, upzones, upfront environmental review, and public outreach are just the beginning.

Stormwater Runoff from Logging Roads Requires Discharge Permit

In a precedent-setting opinion,1 the Ninth Circuit Court of Appeals has ruled that stormwater runoff from logging roads that is collected in ditches, culverts and channels and discharged to surface water requires a water quality discharge permit.2 While this case involves stormwater discharges from logging roads, the Court’s decision could affect other activities that rely on regulatory exemptions from the discharge permit requirements.

The timber industry and the EPA argued that (1) the Silvicultural Rule3 exempts logging road discharges from discharge permit requirements and (2) discharges were exempt under the 1987 amendments to the federal Clean Water Act. The Court rejected both arguments, relying on the broad definition of the term “point source” in the federal Clean Water Act, which regulates discharges from discrete or channeled conveyances. The Court also found that the lack of a specific statutory exemption for logging road stormwater runoff within the point source definition precluded exempting road runoff from permit requirements. Because the Court ruled that logging road runoff was an industrial activity regulated under the 1987 Clean Water Act Amendments, it declined to delay issuing its ruling.

The Court’s decision effectively eliminates the Silvicultural Rule for most logging road runoff, except for unchanneled “natural runoff,” which is not a “point source” discharge. This is the latest case to invalidate EPA rules exempting certain activities from permit requirements. In 2009, the D.C. Circuit invalidated the EPA rule exempting pesticide residue from permit requirements.4  In 2008. the Ninth Circuit invalidated the EPA rule exempting sewage discharges from vessels.5

The breadth of this decision is likely to affect other activities that either rely on EPA regulatory exemptions or involve activities that typically have not required discharge permits. The case is virtually certain to lead to additional litigation in this area.

If you have any questions, please contact Lori Terry Gregory (206.447.8902) or any lawyer in Foster Pepper’s Environmental Group.


1  Northwest Environmental Defense Center v. Brown, __ F.3d __, 2010 WL 3222105 (9th Cir. August 17, 2010), available at http://www.ca9.uscourts.gov/datastore/opinions/2010/08/17/07-35266.pdf
2  The water quality permit at issue in this case was a National Pollution Discharge Elimination System (NPDES) Permit, which is required for discharges of pollutants from a point source into surface waters.
3  40 C.F.R. § 122.27.
4  National Cotton Council of America v. EPA, 553 F.3d 927, 940 (6th Cir. 2009)
5  Northwest Environmental Advocates v. EPA, 537 F.3d 1006 (9th Cir. 2008).
 

Bastyr Goes For LEED Platinum

Bastyr University claims to be the first school in the country to be in line to earn a LEED Platinum certification for its just completed student housing project. Consisting of 11 three story buildings housing 132 students, the project marks Bastyr’s first addition to the school’s campus since the natural health arts and sciences school took over its current home at the 51 acre site of a former Catholic monastery in Kenmore, Washington. Bastyr formally celebrated the project opening on June 22, 2010.

Bastyr and its general contractor, Shuchart Corporation, went through many steps to reach Platinum status. Energy efficient construction was used throughout the project, including high r-value insulation, energy efficient and long lasting fiberglass windows with ultra high performance glass, and radiant floor heating with super high efficiency gas boilers. Energy efficient light fixtures, appliances, and plumbing fixtures were used throughout the project and harvested rain water will be used throughout the complex for non-drinking purposes.

During construction, the contractor was able to recycle a remarkable 96 percent of the construction waste, primarily through training of subcontractors, critical layout of recycling containers, and proactive arrangements with local facilities for recycling of materials. Benches and other items were made form scraps and leftovers, and some chairs and benches were made from the webbing of old car seat belts.

Outside, buildings are connected by a series of garden paths, courtyards, and outdoor living spaces carefully designed to be energy efficient and mitigate the impact on the local environment. Ample bike storage promotes students' use of their bikes for transportation and an extensive bioswale and sediment pond system treats recovered surface water before releasing it back slowly into neighboring wetlands.

Bastyr utilized a LEED consultant for the project, Seattle’s O’Brien and Company, and early on in the project applied for and received a grant from the King County LEED Grants Program. This program is part of the county’s “Green Tools” program to encourage sustainable building outside the city of Seattle.

Bastyr University is proud of its sparkling new sustainable building. Its president, Daniel K. Church, said: “Providing students with eco-friendly, on-campus housing is a significant milestone in furthering our mission to enhance the health and well-being of the human community.”

Is Wind Power Affordable?

 

Traveling north on old logging roads below Blewett Pass, as you start to emerge from the forest above Ellensburg, with the sun setting in the west, look to the east.  You’ll see a far away ridge covered with shining, white towers.  Camelot? Minas Tirith?  No, it’s Kittitas County's Wild Horse Wind Facility, now owned by Puget Sound Energy .  Wild Horse’s 149 wind turbines have blades whose diameters are larger than a commercial jet’s wingspan, and they send clean renewable energy to more than 69,000 homes.  Energy not dependent on dams, gas or coal mining, nuclear reactors or offshore oil rigs. 

So are wind farms "the" answer for renewable and economically feasible electricity?

Maybe an answer, but not "the" answer.  According to the DOE, in 2009 all of the US renewable power sources (wind, solar, etc.) generated only 3-4% of all electrical power, while coal generated 48%.  Many advocate that future development should continue to provide incentives to generate more renewable power that is both affordable and responsible (does not cause costly long term damage to our lands and waterways, like Chernoble or the recent Gulf of Mexico disaster, etc.).

Like the Federal government and other states, Washington State and its voters have provided great incentives for the responsible development of wind power, like in 2006 with I-937.  Although I-937 was under siege even before the recession, thanks to some far sighted citizens it has been protected and remains largely intact.  Accordingly, by 2020 most WA utilities companies will have to produce 15% of all the electricity they generate from renewable sources.  Our state also provides other incentives such as sales tax exemptions and grants, loans and rebates, for the production of wind power.

How does Washington wind power generation compare to other states?  Actually we should be proud, because even though Washington’s geography is not ideal for wind power, and there are far bigger states like Texas and California that also have vastly greater wind potential, we still rank number 5!

So what do the economics of green energy look like since I-937 in 2006?  As construction costs rose in 2006-2008 it dramatically increased the cost of wind power.  Wind power requires negligible fuel costs but very high capital costs.  As construction labor and material cost (like steel) spiked, the cost rose so high some work slowed or was shelved.  However, as construction costs fell in the recession, wind projects became much more viable.  In May of this year, PSE ordered another 149 wind turbines for its Lower Snake River Wind Project, with an option for 110 more.

According to GE Energy’s recent Western Wind and Solar Integration Study (“WSIS”) the cost to consumers for wind generated electricity is becoming more affordable as an increasing number of wind power plants come on line.  Improvements in technology are lowering costs too.  Note that the WSIS cost analysis does not factor in the external costs that clean wind power reduces or prevents in the form of environmental contamination related clean up, associated health care claims, destruction of habitat and wildlife, the cost of military action to protect energy supplies, not to mention the potentially huge costs of global warming due to emissions from structures powered by fossil fuels.

While wind power is not yet less expensive than other energy sources, when you factor in the savings due to the external costs that wind power largely prevents, it seems that greater production of wind farms is a must for responsible development.

Gregoire Asks SBCC To Delay Energy Code

Washington Governor Christine Gregoire just wrote a letter to John Cochran, the Chair of the Washington State Building Code Council asking him to defer the new energy code until April 2011.  Gregoire's concern is of the probable negative impact the code would have on the recovery of the economy and the construction industry.

The Governor's request is timely given the lawsuit filed recently by the BIAW (that we posted earlier).

We also posted two questions in April and May about green codes: "Can homebuying consumers bear the cost of new green and energy codes during recession?" and "Should green building codes be mandatory?"  Both questions appear to have been answered by the Governor.  In the long term, Green can be affordable, but in the short term, during hard economic times it may have to be deferred or remain voluntary.  

It seems that between the executive, legislative and judicial branches of our state government that until the recession is over, there should be no further mandates requiring taxpaying citizens and businesses to pay more for greener and more energy efficient homes.  However, once recovery happens and the construction industry exhausts existing supplies of non-green materials and components, that the cost benefit of green energy efficient materials and components may be mandated and embraced by all Washington residents for the obvious future long term benefits.