Metal Roofing Benefits From The “Bail Out” Bill With Tax Credit

By Scott Kriner, Green Metal Consulting

On October 3, 2008, President Bush signed into law the Emergency Economic Stabilization Act of 2008, commonly referred to as the “Wall Street Bail Out” plan. A Congressman who opposed the bill described that piece of legislation as “a marshmallow inside a cow pie”. There were many features of the bill that supposedly will rescue our nation from the financial crisis that we face. But there are also some features of the bill that were added to create a stimulus for the economy in general – such as in the area of tax re-structuring. I guess those tax-related items are what the Congressman considers to be the marshmallow inside the cow pie of the bill.

Fortunately for the metal roofing industry, part of that interior marshmallow included extensions to the tax incentives that had originally been part of the Energy Policy Act of 2005 (EPAct 05). Some of those incentives had expired at the end of 2007. But now, they are alive for at least another year and even longer in some cases.

The EPAct 05 law provided tax incentives for renovation to homes included up to a $500 tax credit for homeowners who install a cool metal roof. That incentive pertained to “qualified energy efficient improvements”, which were defined in the bill as “any energy efficient building envelope component which meets the prescriptive criteria for such component established by the 2000 IECC (or in the case of a metal roof with appropriate pigmented coatings which meet the ENERGY STAR program requirements). The definition of a building envelope component in the bill includes “… any metal roof installed on a dwelling unit, but only if such roof has appropriate pigmented coatings which are specifically and primarily designed to reduce the heat gain of such dwelling unit.” So basically, an ENERGY STAR-labeled prepainted metal roof qualifed exclusively for this tax credit through 2007.

The newly signed “bail out” bill now extends that tax credit through the end of 2009. But, the new bill also refers to asphalt shingle roofing as being an energy efficient building envelope component. The law now states “ …(or in the case of a metal roof with appropriate pigmented coatings or an asphalt roof with appropriate cooling granules, which meet the ENERGY STAR program requirements).

Likewise the definition of building envelope components now states “… any metal roof or asphalt roof installed on a dwelling unit, but only if such roof has appropriate pigmented coatings or cooling granules which are specifically and primarily designed to reduce the heat gain of such dwelling unit.” Can we interpret this to now include cool granular coated metal roofing ???

Any tax credits for the cool asphalt shingle roofs take effect on installations made after Oct 3, 2008, the date of the enactment of the new bill. The cool metal roof tax credits, however, are in effect retroactively from Dec 31, 2007 and through 2009.

Other tax incentives from the EPAct 05 bill were also extended. The new home tax credit of $2000 for contractors who build dwellings with annual heating/cooling energy usage reduced by 50% compared to a standard dwelling complying with the 2004 Supplement to the IECC are extended through 2009. And the commercial tax deduction of up to $1.80/ft2 for building owners who design a structure that achieves a 50% reduction in annual energy cost compared to a base building defined by ASRAE 90.1-2001 is now extended through 2013. Those savings in energy costs refer only to heating, cooling, ventilation, lighting and water heating.

So the metal roofing industry made some gains in the “Bail Out” bill due to the fact that the tax incentives to owners and contractors have finally been extended. Cool metal roofing can directly or indirectly contribute to the tax credits and tax deductions in the residential and commercial construction markets. The marshmallow in the cow pie for the metal roofing industry is no longer a sweet treat, since the exclusivity of cool residential metal roofing is now gone, giving way to cool granulated asphalt shingle roofing now being part of the mix.

Editor's Note: Since this column was originally posted, the author has gotten clarification on the effective dates of the metal roofing tax credit. To read a brief follow-up column, "Clarification On Dates Of Metal Roofing Tax Credit", click here. 

Scott Kriner is the president and founder of Green Metal Consulting Inc. He is a LEED Accredited Professional who began his career in the metal construction industry in 1981. His company is a member of the U.S. Green Building Council, the California Association of Building Energy Consultants and the Residential Energy Services Network (RESNET). Scott can be reached by email at skriner1@verizon.net, or by phone at (610) 966-2430. You can also visit him on the web at www.greenmetalconsulting.com.