Stimulating Metal Roofing And Housing: 2009 U.S. Stimulus Bill Passage

By Scott Kriner, Green Metal Consulting

Whether or not anyone has read the American Recovery and Reinvestment Act of 2009 (aka the Stimulus Bill), it is clear that the rules have changed in Congress when it comes to passing legislation. In previous years, Congress insisted on identifying ways to pay for tax credits or rebates from the federal government. This often hindered the passage of legislation that included extensions to the tax incentives first enacted in the Energy Policy Act of 2005 (EPAct05) and later extended somewhat in the Energy Independence and Security Act of 2007. However, at least for now, those “pay as you go” rules are no longer in effect.

So with an open-ended philosophy on how appropriations bills will be funded, Congress easily passed the new Stimulus Bill which includes extensions and increases to the tax incentives related to energy efficient improvements made to existing homes. These incentives were not only extended another year but increased in the amount of money available to owners, builders and even designers.

• The new law states that homeowners who place a prepainted or coated ENERGY STAR labeled metal roof into service between January 1, 2009 and December 31, 2010 can now qualify for tax credits in 2009 and 2010.

• The original tax credit in the EPAct05 allowed a homeowner to receive a tax credit of up to 10% of the material cost (max $500 tax credit) for installing a prepainted or coated ENERGY STAR labeled metal roof. The new Stimulus Bill raised the tax credit from 10% of the cost of the improvement material or item to 30% of the installed cost (materials only) over the years 2009 and 2010 combined.

• As a result, the maximum credit has also been raised from $500 to $1500 for the two years combined.

• The home must be the taxpayer’s principle residence.

• A homeowner simply needs to save their receipts and the metal roofing company’s Manufacturer Certification Statement that accompanied the roof. That paperwork does not need to be submitted to the IRS, but it should be kept on file just in case the IRS has questions later.

• Homeowners who qualify should use the 2009 version of IRS Tax Form 5695 when filing their tax returns.

If this isn’t enough to stimulate homeowners to install a cool metal roof, remember that tax credits are subtracted from the homeowner’s federal income tax liability. This means that a tax credit is worth much more in actual savings than the dollar amount of the credit itself.

Another issue that should help to stimulate the housing market, and create demand for cool metal roofing, is improving energy efficiency. A new plan being promoted by Ed Mazria, of 2030 Challenge fame, will be presented to Congress as they contemplate detailed steps to take in hopes of bringing life to the housing market.

His plan is called the “Two-Year, Nine-Million-Jobs Investment Plan”. It is based on getting people to buy and construct buildings again. To do this, he is looking at the private building sector that represents 93% of the building construction market and impacts the entire US economy. The crux of his Plan is to offer lower mortgages to owners of more energy efficient new and existing buildings. If successful, the plan would result in a resurgence of construction and create a new renovation market. At the same time the emphasis on building energy efficiency would move us closer to the goal of the 2030 Challenge, whereby all buildings would be carbon neutral by 2030.

Ed is calling for a strategic investment by the Federal government of $192 billion over two years. His projections show that the plan would create over 9 million new jobs and $1 trillion in direct, non-federal investment and spending. It would also open a new $236 billion renovation market that could grow to over $2.6 trillion by 2030. The plan could pay for itself annually through the tax revenue created by the new jobs. Existing federal programs could help to implement the plan very quickly.

Ed believes that demand for higher energy efficient homes and buildings would be generated by lower mortgage rates and the realization of lower energy bills. Hence, the lending institutions will be directly affected by this investment strategy. Ed is proposing a tiered approach whereby buildings that meet more stringent “stretch code” levels of energy reductions, compared to the IECC 2006 and ASHRAE 90.1-2004, would receive mortgages well below the market rate. The more energy reduction achieved through renovation or new building design, the lower the mortgage rate being offered.

Ed Mazria believes that investing in the private building sector generates a higher demand for construction services and products than the public building sector. Hopefully, between the extended tax incentives and the growing interesting energy efficiency, cool metal roofing will be in a great position for the resurgence of the housing market.

For more information on the Two-Year Nine-Million-Jobs Investment Plan, visit www.architecture2030.com. 

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.