testify about the role that the department of housing and urban development and the federal government overall can play in improving the energy efficiency and sustainability of residential buildings my name is doug at one and i'm the vice president of market development for the u s green building council u s g b c is a national nonprofit organization working to advance more environmentally responsible healthy and profitable buildings and our organization and members manage and own the lead green building rating system through which more than thirty eight thousand spaces have either been third party certified or in process of achieving certification with the housing crisis and economic downturn climate change on the horizon and stakes for our nation have never been higher and even more or so for our nation's low income communities as our economy struggles to regain its footing the nation's low income households are paying on average nearly nineteen and a half percent of annual income on utilities while the average median income household spends just four point six percent and hud spends more than five billion dollars annually in direct and indirect utility costs the price of any fish and buildings is significant and the need for action is clear green buildings offer a powerful means to address the interconnected goals of sustainability and affordability in our nation's housing by addressing the whole building from construction materials to cleaning supplies green design and green operations generates opportunities to significantly reduce operating costs emissions and environmental impacts but sustainability is not limited to environmental performance alone rather it hinges on the creation of buildings and neighborhoods that are socially and economically sustainable as such u s g b c strives to integrate the practices of social and economic justice within those of sustainable building and among other efforts u s g b c is providing education targeted to the affordable housing industry about best practices for developing green affordable housing including a newly developed today affordable housing summit at our annual greenbelt conference across the country projects are demonstrating the real benefits of green affordable housing to date four thousand affordable units have registered with us g b c's lead for homes system and affordable housing units account for fully thirty seven percent of the twenty two hundred units that are already certified nation through lead for homes green building practices can directly benefit affordability this is most clearly demonstrated by a particular nonprofit housing development in michigan where two otherwise identical buildings differing all only in that one was built to lead standards and the other was built with standard design and construction methods over two years of operations the owner has documented twenty six percent savings on electricity and forty one percent savings on natural gas for the lead certified project public housing agencies have documented similar successes and often through hods energy performance contract process this has been made available nationally nearly two hundred energy performance contracts have been undertaken by public housing agencies resulting in savings of approximately fifty million annually to hud thus far importantly green building can offer health benefits as well and residents of low income housing are frequently children seniors and individuals with chronic health problems some of our most vulnerable citizens with an emphasis on the use of non toxic materials and proper ventilation green building targets improve indoor air quality for residents how it is undertaking research in partnership with the centers for disease control and prevention to further quantify these links as the administrator of billions of dollars in grants and hud plays a critical role in both defining and delivering affordable housing nationwide by leveraging the purchasing power of taxpayer dollars to support green efforts hud can forge a greener more efficient healthy and prosperous path for our nation's public and assisted housing the green act stablish is minimum energy efficiency standards for hot assisted housing and promotes the creation of incentives for advanced energy efficiency and green building the act promises to spur advances by providing needed financing mechanisms supporting states and localities and improving energy efficiency of homes and creating jobs through the residential efficiency block grant program and providing education through green banking centers additional efforts can help to an sure but the promise of the act is realized for example the act identifies energy efficiency and green building standards as tools for improving the performance of how this is to pursue all of these will need to take proactive steps to verify these projects thank you again for your leadership in convening this hearing we look forward to working with the committee and others to green our nation's health thank you very much  chairman woman waters ranking member capital and members of the committee thank you for the opportunity to testify in the green act i want to send in a specially grateful note to representative  mother for his passion and continue leadership on this issue i am doors president and c e o of enterprise community partners enterprises a national nonprofit that has invested over ten billion dollars to create two hundred fifty thousand homes in low and moderate income communities over the last twenty five years we are bringing the benefits of green building to low income people at an unprecedented scale through our green communities initiative or were developed in collaboration with and endorsed by leading environmental energy green building affordable and public health organizations in less than five years enterprise has invested more than six hundred fifty million dollars to create more than fourteen thousand five hundred green communities homes in over three hundred in fifty development our vision through this initiative is for all of the housing in the united states to be environmentally sustainable greening can and must be achieved without compromising and sacrificing affordability the case has been clear in in addition to the compelling statistics cited by chairwoman quarters in her opening remarks and many of the statistics shared by the previous speaker we i want to emphasize that greening affordable housing is interim mental in bringing better health to low income children and families that are more prone to suffering from adverse health hazards including exposure to allergens that might cause a worse and asked lead based paint hazard mode and excess moisture and indoor air quality this report from the congressional black caucus foundation that cites that african american are african americans are disproportionately burdened by the health effects of climate change in quote including increased deaths from heat waves and extreme weather air pollution and the spread of infectious disease we can and must make progress on all of these issues housing transportation and climate change simultaneously by locking in the long term benefits and investing in green affordable homes many speakers have cited the benefits of going green they largely fall into three categories cost savings you heard from the previous speaker health benefits i want to give a specific example on a recent study done by an upright commissioned by an upris collaboration with the seattle housing authority and the king county public health department and the university of washington the subject of the study is high point six three an affordable housing project that was funded and built through hope six and a multiple of funding including low income housing tax credit there we singled out sixty rental housing and work with the county public health department to make them into easy housing by  screening and giving preferences to public housing families with children suffering from asked to occupy these new units and we did a long term study and in less than three years we show that the number of emergency room or two weeks to twelve and a half days in a twelve in a two week period almost a sixty five percent increase of symptom free days and caretakers themselves reported an increase in the quality of life not to mention  of work and school these findings totally support the initiative under the green act we applaud at the committee for recognizing the costs and benefits of greening affordable housing and the holding a hearing on this legislation we want cite the three reasons why this bill is so important one it sets the bar by requiring had to go green and adopt minimum building standards with rewards for higher performance to it creates a system of rewards incentive education by putting resources to help states and municipalities to subsidize energy efficiency of single and multifamily housing and capacity building grants to help increase the knowledge and know how  doing energy self sufficient energy sufficiency as well as a revolving loan fund because it's a carryout the noble energy retrofit this is the kind of federal commitment we need and want to see but we also want  to stress that these incentives must be shared equally with the owners and tenant so that thank you so the tenants can live healthy and the green and access the good jobs that can be made available and we applaud your sustainability innovations group chairman of the surface transportation policy project and secretary of the institute for location of patients and we support the entire bill that i had today i want to focus my remarks on in particular  mortgage provisions that were referred to earlier by sharing some research that's been going on for twenty years some with federal support and that's been recently bettered in peer reviewed by the transportation research board of the national academy of sciences i also want to directly address the question the chairman posed on the impact on low and moderate income people and people of color during this testimony first of all transportation expenses are often talked about as and  transportation emissions is number two after building household point of view transportation could be three to time five times as expensive as the cost of home energy so it's not a favor to low income people to not include the consideration of more convenient the community the lower the transportation demand and therefore the lower the expenses and this is now been proven to work for all three hundred thirty seven metro areas in the united states so the same curve works for carbon now what this shows is that if you map it as vehicle miles traveled you get a certain pattern this issue because of those light color areas are the places that are transit oriented more densely populated much less travel those are also the places that when gas prices spike last summer we're paying as much as four thousand dollars less per household just on the price of gasoline alone if you map a different way and ask how much would somebody save if you had one less car per household those green areas people are saving people earning less than fifty thousand dollars a year saving and a twenty percent of their disposable income so we asked what if you could take that into account and mortgage underwriting we formed a partnership in the ninety's with natural resources defense council n s t p p partnered with fannie mae demonstrated something called location efficient mortgages and what we asked was and this is to the point of your question german what w impact lower income people the green line on the top says that white headed households in chicago right now can easily afford the median income home in chicago they get with no extra energy or location benefit at all they can easily afford a three hundred thousand dollars household of their own median income home with their immediate income household the median income home is two hundred forty seven thousand which is more than either hispanic or african american households could afford hispanic households earning forty six thousand per year that's the median in chicago if they can count two hundred forty five a month in monthly savings from energy and location efficiency can afford the median income households in african american households if they can count five hundred fifteen a month can afford the median income home and importantly one last carper household saves four hundred seventy five dollars a month after you've paid for two monthly transit passes so there's a tremendous potential uptake here we tested this there were two thousand mortgages made about a dozen communities under names like location of mortgage market mortgage and i like the tribune comments get the car buy a house it was a safer way of lending whereas some people said i won't go through the numbers this would as somebody pointed out stress fannie and freddie in fact out of two thousand mortgages or was one is the drive to the qualify pattern is alive and well in every region of the country ten to twenty ten to fifteen miles out from the center of every city the price of housing drops precipitously but the cost of transportation goes up for the extra car two or three and we created a new index a housing affordability that takes transportation into account and the map on the left says that in those cream colored areas i mean come households can afford to spend thirty percent or less for housing the map on the right says that if you add the cost of transportation in that cream colored area shrinks up you have about thirty percent less homes that are affordable as a result in chicago still so the bottom line is that the right elements are in the act and that's why you want to pass it by improving at the consumer education stuff in particular is extremely important the demo programs we have show people saving money four and a half million new jobs twenty billion going into local government coffers and the government gets back double its investment billion dollars how does it work we're calling for  mortgage and you have to reduce your energy consumption by seventy five percent will illustrate how lucrative that is to get a three percent mortgage if you had a two hundred fifty thousand dollars mortgage you'd have to put forty thousand dollars in renovation cost inefficien that's more money in his pocket so by putting money into public infrastructure versus private building if you put it in the private building two hundred ninety six billion worth of construction you get four and a half million jobs you get one of the nation's largest homebuilders chairwoman waters i sincerely appreciate the opportunity to testify this afternoon in many ways here in the questions you sent me touch on some of the most important aspects of my life work urban redevelopment affordable housing support for low and moderate income families in these capacities i have worked for the national neighborhood reinvestment corporation to bring capital to blighted areas i've also worked twelve years for the community redevelopment agency of los angeles where i had the privilege of working with you chairwoman waters and others to h revitalize watts and south l a after the civil disturbances of nineteen ninety two i've also worked as a developer for the past ten years and i know that you share my hope to bring clean renewable and most importantly of energy to all neighborhoods to that end i would like to focus my comments in this limited time on two areas first i would like to discuss section twenty seven of the bill the renewable energy lease and provision second directly respond to your questions of how this section of the bill would affect low and moderate income households and communities section twenty seven of the bill will greatly expand the ability of americans to enjoy the benefits of renewable energy such as solar in their home as we all know it takes green to go green and in today's tryon economic times many simply cannot afford the upfront cost to buy an asset like solar panels even with the current level of federal and state incentives at the same time private investment both debt and equity have had a difficult time investing in leeson at a large scale because there is no it stabs  of those assets over ten the result is a delay in the adoption of these clean technologies when we need them most in short we need to make going green cost less green section twenty seven can fix this by stablish in our low insurance program paid for entirely by user the h r twenty three thirty six which set a baseline for renewable energy systems long term by laying the foundation for private investment the result would be transformational leeson with become a reality clean technology investment would resume with jobs would be created our environment would benefit and at no cost to the taxpayer to put it in perspective if just five hundred thousand homes included solar energy systems that would mean saving the equivalent of six point six billion barrels of oil annually reducing carbon emissions by the same amount as removing four hundred forty thousand cars from the road producing the energy equivalent to three new nuclear power plants and create an thirty five thousand job chairwoman waters with the upper mission i would like to submit for the record a more detailed analysis of how renewable leasing would work also mentioned earlier in my testimony that the renewable lease in provision carries no cost to the taxpayer chairwoman waters with your permission i would like to submit by the record an analysis we commissioned by former congressional budget office office director douglas hopes he can he concluded quote this will not be a budget buster chairwoman waters you asked for comment on how this bill would benefit low and moderate income households and communities section twenty seven would have a big positive impact in these unemployment at double digit levels in much of the country and low income people particularly feeling the impact of the recession the increased demand for these systems would create thousands of green clean tech jobs here on the water we believe or no energy lease and is a cornerstone in the next generation of economic development prosperity environmental stewardship for american families thank you for the opportunity to test by i look forward to answering your questions and to working with you any r s one point two million realtors on the green act and then i would like to briefly comment on h r twenty four fifty four the american clean energy security act because the possibility of a distraction from our undercutting the goals of the green act are very real in our opinion and they are extremely committed to advancing energy efficiency in homes and buildings across the country has taken a number of important steps like building the first leed certified office building in the district we've developed extensive member while creating jobs and reducing energy costs for consumers lastly we support section seventeen which melds housing strategy with transportation planning residents of affordable housing have access to public transportation in addition  our already troubled housing market without actually improving energy efficiency in homes and buildings in a timely manner we feel the label stigmatize older properties and property values specially troublesome as a disproportionate share of these older and historic properties are owned by elderly and low income americans who can least afford to make changes to their properties we also concern with the timing of disclosing an energy label our members experiences tell us that labels will become just another bargaining chip closing to negotiate down the selling price without making any energy related improvements the home or the along with the applicable provisions of the green act as the most effective means to improve energy efficiency in america's home building this is a critical housing issue this is a critical economic development issue for our nation and therefore we believe it is worthy of this com up front cost people might have to come up with twenty twenty five thousand dollars and specially in most low and moderate income areas people don't have that kind of money upfront and therefore they do not take advantage of these solar panels which could help them to lower their utility costs like example the other second part of what i meant was that  you just have the you need private capital oftentimes the government can just have an initial catalytic step in helping to make sure that instead of having to put money up front you can do the least and program which means that people will not have to pay that upfront cost and they will pay a modest monthly cost that way they can get it and  encana like we talked about lease and by this lease in an automobile or less a satellite television you don't have to put up a lot of money you just have to pay a little bit over time and that certainly would be very helpful to a low or moderate income type family that was the essence of it and right now because people don't have that front money to purchase this a lot of people want to would benefit from it but don't have that money and with this what what this section twenty seven deals with let's figure out how to get a lease a mechanism that brings in private capital to get it in and operate and and people can just pay a small amount on a monthly basis that would be less  i'm just going to make a couple comments and allow the other members to ask questions but to your concern madam chairwoman there are several approaches within the bill some of it is mortgage in the secondary market or a location mortgage in the secondary market the belief being that if a homeowner manages their utility costs or their transportation costs there are better credit risks so  that they have more disposable income at their at their disposal they have more income at their disposal a lower potential lower mortgage as part of this secondly there is and you can be their first or second would leave the solar system or could be geothermal or some other kind of renewable energy system within the home lease that to the homeowner say forty dollars a month but their energy savings would be eighty dollars so net net to the homeowner if communities did a zoning overlay in certain parts of the of the city where the new building codes would in fact additional requirements would be adherent to it when you talk about adding mandates in certain neighborhoods and not another neighborhood it creates a disparity in the market so i'm not sure that we would look for be in some neighborhoods and not others moreover i guess our primary concern with any of that it would increase so again you'd have to look at the neighborhood in question determine what the affordability levels are how much that would be that are out there now as the as the benchmark then everyone would have to abide by it one of the problems with the incentive is there is an additional cost to the homeowner because they don't get any credit for the so the home builder passes along the savings to the homeowner to the buyer but that's a voluntary program it's not a mandated program and generally the homebuilders would check with the think we have found that the creation our new zoning code of overlay districts for what are called transportation zones ended up stimulating investment in green house saying interestingly that wasn't necessarily expected so i think rehab those old brick structures anybody again and maybe you can help make sure i can be happy to start off i think in many cases it may be more there may be a greater return on investment from renovating existing housing however i think that it's important to have benchmarks for new construction because there's still such a wide range of energy and environmental performance and one to address the issue of valuation to bring that into this whole discussion i do think it's important for the committee to know that the available research often shows that there's not nearly as strong a connection between efficient technologies and buildings so you can put in a high efficiency air conditioning unit let's say and not necessarily get the kind of bill savings that you're looking for without right sizing the equipment without mapping so that the the air conditioner is right sized to let's say the fan and then in the furnace  system the point of that is there's a lot of variables which is why we actually strongly believe that some kind of voluntary labeling program that helps the homeowner understand the energy performance of their home is really valuable to the homeowner of those market transactions but back to your question sir the number of cost effective energy saving opportunities in existing homes is enormous and they can be identified through simple measures like lower door testing and infrared scans where in many cases the number one energy saving opportunity is more insulation air sealing and duct ceiling and those things can be done for pennies per square foot and in many cases by do well one third of the lead certified projects currently are low income housing where the median income of the family is below fifty thousand and what we're finding across the board is twenty twenty eight to thirty three percent reduction in energy costs and in many cases green housing and green building generally can be built for either zero premium or very know what i think i was saying is and i think it says it in here that that if we're going to be granting incentives in here we should avoid the phenomenon of driving to greenhouse it might look green if it's thirty miles out but if it cost you three times as much not a good deal no matter where it is and that's why we support the improved language under the c r a credit provision that speaks to location efficiency not just energy efficiency if you lee gave credit for energy efficient mortgages and didn't consider location efficiency you would run the risk of incenting more sprawl in the name of being green and i don't think any of us would support that here and i think by contrast if you have suburban areas that are location of fish and they have the density of the accessibility there's places to shop nearby and you can plausibly keep improving on and we've got plenty of map that for every region and that should be where we're targeting these kinds of activities because you will get to do a lot more of it for the same money available and we'll all meet the multiple goals of this act and the other things that we're trying to do so that's what weare proposing here and that's why we think