With information overload, city taps brakes on Green Building Policy

ITHACA, N.Y.—The enormity of the Ithaca Energy Code Supplement, a.k.a. the Green Building Policy, seemed to weigh on the City of Ithaca Planning and Economic Development Committee (PEDC) last night. With dozens of emails and public comments from seemingly every angle on every aspect. the council hit pause on further review until they could get a better grasp of it all and come up with a coherent plan of revisions. That and more filled Wednesday night’s Zoom meeting, and for those who want to dive in, read on. The agenda from last night is here.

IURA 2021 Mini-Action Plan

This Ithaca Urban Renewal Agency (IURA) 2021 Mini-Action Plan is basically a case of some awkward timing. The homeowner of 110 Auburn Street in Fall Creek recently passed away. Her family is settling her affairs and accepted a purchase offer from non-profit housing provider Ithaca Neighborhood Housing Services to buy the house. INHS would buy the century-old 3-bedroom home and renovate it – it’s physically solid but needs some rehab. INHS would then sell it to a lower-middle income buyer (someone making about $45,000/year, INHS helps cover closing costs and the down payment) who will make it their new home. The property would be locked into the Community Housing Trust (CHT), which lowers taxes and locks in a 2% appreciation rate for home value as a way to keep it affordable for future buyers over the next 99 years.

INHS will pay about $189,000 for the house (which for Fall Creek is a bargain these days), spend about $78,900 on rehabilitation, and sell it to their lower-middle income buyer for $170,000. With contingency and soft costs (legal, taxes, fees), the total costs incurred will be $268,600. No bank is going to issue a loan for anyone to buy a house, renovate it, and then sell it for less than they paid. Funding sources need to come from elsewhere. along with budgeting for the $170,000 sale, INHS will put up $58,600, and hopes to secure the rest from the county-run Community Housing Development Fund ($40,000) and the IURA ($30,000).

The timing is that INHS would like to renovate it during the spring and summer, when our weather is more amenable, and have the house ready for sale by the fall. Otherwise, to have the money needed, they’d need to save up more for the cash equity and wait another year. To start in March, they need a pre-award, a promise that the $30,000 is coming. But given the timeline of the federal Housing and Urban Development (HUD) funds that pay for IURA awards, the Action Plan money typically isn’t awarded until June, let alone paid out. HUD says INHS can’t accept federal funds and do work on the house unless the city has an Action Plan in place. Hence, the IURA is suggesting a mini Action Plan just for this proposal, with paperwork, 30-day public comment period, public hearing and Common Council approval, just as they will do with the full Action Plan in a few months.

For the record, the IURA usually gets about $900,000 to put towards the Action Plan. It’s just that in this case, when that federal award comes, $30,000 would already be spoken for. The PEDC was to host a public hearing on the Mini-Action Plan, and vote on whether or not to send it to council.

Rather unusually, Councilor Cynthia Brock (D-1st Ward) sent a pre-meeting letter to Ithaca Voice reporter Matt Butler, select city staff and Council beforehand to say she would not support the plan. Rule of thumb, if an email to a reporter starts with “I am sure my vote will be seen as unusual and deserving of an explanation,” that’s a warning light for controversy.

Brock explained in the letter, copy here, that the issue wasn’t the mini-plan schedule, but that the house would go into the Community Housing Trust to lock it in as affordable. She stated that she saw that as taking the risk and reward out of homeownership and limiting wealth generation. Seeing an elected official in Ithaca arguing that gentrification should be embraced is abnormal to say the least.

No one else in attendance seemed to share her view. The public hearing for the mini Action Plan had no public members wishing to speak, so it opened and closed quickly. “I’m very pleased to be supporting this resolution tonight and the Community Housing Trust program, this is a real win-win for the city. This increases home ownership in the city for low and moderate-income families,” said councilor Laura Lewis (D-5th). “This meets our goals of expanding the supply of for-sale homes in the city, expanding homes available for low and moderate income residents, and keeps this home in the affordable market in perpetuity. I’m really pleased that we’re moving this.”

“There’s been a trend in my neighborhood where older houses in my neighborhood are being purchased, flipped, and rented out by the room or AirBnB. I really appreciate this (CHT) program and its efforts,” added PEDC Chair Seph Murtagh (D-2nd).

At the meeting, Brock further called homes locked in the affordable housing trust “ill-advised investments” and saying that at least renters have no risk because they’re not responsible for maintaining their houses.

“I don’t have the same concern about the Housing Trust because it provides immense opportunity and your statements about the risks of home ownership are true for anyone,” said INHS’s Leslie Ackerman, who did a deep dive into Brock’s argument. “Yes, the investment doesn’t pay off as fast at ‘the sky is the limit’ appreciation, but they benefit from the more modest appreciation of wealth and the advantages the CHT conveys…they’re benefiting from a dramatic reduction in property tax because the home is assessed at resale value, not potential home value. That makes it more affordable as a home.

Ackerman tackled Brock’s assertion that it was a better move to rent rather than purchase a CHT house. She compared one of the town homes recently completed at 402 South Cayuga Street with a two-bedroom apartment at 327 West Seneca Street. The two are new and financially comparable buildings, both aiming for the 80% area median income bracket.

Ackerman noted 327’s rent is $1,373 dollars for a two-bedroom per month, which she said was more than 34 percent of income for someone making 80 percent of the area median income. She contrasted that with the townhouse, also a two-bedroom at 80 percent. She calculated that the homeowner is going to be paying less than $1,100 a month in total housing expenses, with another $100/month on average towards home maintenance (it is built to avoid major repairs for at least 15 years, as are the rehabs).

“If we compare these two scenarios, the homeowner has paid less on a month-to-month basis and has five-figures of appreciation at 2%, while the renter’s walking away with nothing, and is at risk of losing their home if the rents are increased or the landlord chooses to do something else with the property. They have no financial reward in the long term. The Housing Trust isn’t a perfect fit for everyone, but nothing is,” Ackerman said.

The vote to approve the Mini Action Plan was held after Ackerman agreed to meet with Brock later. The PEDC voted 4-1 to send to Council, with Brock opposed.

Ithaca Energy Code Supplement

Back before the PEDC last night was the Ithaca Energy Code Supplement (IECS), informally called the “Green Building Policy.”  IECS is part of the city’s “Green New Deal” plan. After reviewing the comments PEDC received during circulation, this was their chance to tweak the legislation accordingly and decide whether or not to send on to Common Council for a vote to make it the law of the land.

The IECS will require that all new buildings are constructed in such a way to produce 40 percent fewer greenhouse gas emissions than New York State code requires and will require that new construction be net-zero by 2030. The policy will use a points-based system for new construction projects in Ithaca, which will be awarded points for efficient electrification, affordability improvements, renewable energy and other aspects like walkability and adaptive reuse.

New buildings — both residential and commercial — will need to achieve six points to be approved. For example, under “efficient electrification,” a building can get five points for ground source heat pumps and one more point for electric stoves and ventless heat pump clothes dryers, with a prerequisite being no fossil fuels in the building. Since the August 2019 draft, one awardable point was added for kitchen equipment electrification (vs. gas stoves and the like), and scoring was added for on-site electric vehicle infrastructure.

The IECS is also circulating for town review as well (both Ithacas, city and town, have adopted the policy), and it will include a reference manual for property owners and builders, the IECS itself, and a copy of the ordinance’s legal language. Once approved, the IECS will become the official policy within a few months, and automatically tighten to a more stringent standard in January 2025. By 2030, only net zero energy buildings that are free of fossil fuel use will be permitted. As previously pointed out to me by longtime environmental advocate Sara Hess, practically all major building projects underway (all residential or largely residential) have adopted structural designs and engineering systems that will comply with the first (pre-2025) stage of the IECS.

Last night’s public comment was all about the IECS and lasted about an hour. Unlike previous public comments, there was a mix in favor of the sustainability goals, and not. Doug and Bruce Brittain of Forest Home spoke against the plan because the plan supports electrification of gas heating sources rather than reduction of energy use. The Brittains suggested eliminating existing users, and then when those are sufficiently reduced the city and town could consider turning away from natural gas and towards electrification of heating sources. Cornell Facilities expressed concern about impacts on the energy use and needs for its research buildings. On the other end were members of the Sunrise Movement, who have continued to push for a more stringent Green Building Policy, with quicker ramp-up of the more rigorous standards and no permission for fossil fuel use in new buildings. A petition advocating for more stringent energy standards was submitted, with about 125 signatures. Hector Chang of Bike Walk Tompkins advocated a strengthening of walkability and greater emphasis on bicycling and mass transit prioritization.

To try and sum it up, some felt it went too far, some felt it didn’t do enough as a whole, and some felt it didn’t do enough to cater to their respective organizations. But generally, most liked the IECS in principle. The city and town can’t please them all, but at least the commentary gave plenty of food for thought. The unanimous vote to open environmental review opened discussion.

Sustainability Coordinator Nick Goldsmith explained they had received dozens of comments, including eleven pages from Cornell that he was still working on responding to. Compared to most PEDC Reviews, this was a flood of questions, comments and concerns. Most of the emailed comments from the public have already received responses from Goldsmith, and he added that the town of Ithaca is considering moving up timelines for more stringent code implementation, but is still discussing it. In response to a question from Murtagh, Goldsmith added that while it’s better the city and town are synced up on timelines, they don’t have to.

“What was progressive in 2018 maybe isn’t as much in 2021…realizing how urgent the fight against climate change is, I would like to speed (that timeline) up,” said Murtagh. Councilor Donna Fleming (D-3rd) asked about the Brittain’s comments, which Goldsmith and consulting engineer Ian Shapiro of Taitem refuted because there is only one point related to electrification of heat itself, and the energy grid has become much cleaner in the past ten years and is become even cleaner as multiple large scale solar arrays are set to be brought online in the next year. Fleming said what they needed were regulations on people’s behavior, since some use much more energy for comfort than others, to which Goldsmith pointed out they simply couldn’t do. She made it clear she did not support stronger IECS guidelines quicker.

“If we were to adopt 2025 now, those standards are going to get 70, 80% reduction of emissions instead of 40%. But it’s complicated. Nick and I would need to go back and do some redesign because the code is partially predicated on the (power) grid being so much cleaner by 2025. It would be easier to keep the existing proposal and accelerate it modestly, rather than take 2025 and do it now. I’m sympathetic to that accelerating, but it would take a redesign (of the code) and slow us down,” said Shapiro. In other words, the points would grow and a building project becomes more electrically-focused with heat and power, but we still have an existing, dirtier power grid, which negates the benefits.

“The points for electrification double in 2025 because the grid (of 2025) is cleaner,” added Goldsmith. “That’s why if we doubled those points today, it’s on a whim, whereas the reason they double is because the grid is getting cleaner.”

Lewis asked if perhaps the 2025 guidelines could be moved up to 2023, when the grid would be somewhat cleaner and allowing time for a dry run to make sure the code works as intended. While she was in favor of some acceleration, she was not sure if right away was a good idea due to concerns about imposing costs on non-profit developers, or as she later put it, affordability and equity.

“I’d be open to advancing it by two or three years. That gives us time as code inspectors and developers to get used to it and prepare for the change. It is more feasible,” said Goldsmith. “I support that strategy.”

Councilor Brock was somewhat more reluctant about the IECS. She supported 2022 or 2023, but was concerned about impacts on commercial buildings. Consultant Shapiro said they were expecting costs to come down, but it was a factor in why there was a ramp-up period to 2025. Brock further expressed concern that dedicated developers might be able to navigate the code more easily than homeowners just looking to expand a kitchen or do something like an in-law apartment, and was worried about it being burdensome on homeowners by forcing them to update their entire energy system just to do basic home renovations. She stated she wanted an energy code square footage threshold exception greater than the proposed 500 square feet. She also did not want to stop homeowners from being able to install wood stoves in new construction, citing the current power grid collapse in Texas and a worrying reliance on electricity.

“This feels very, very intrusive,” said Brock. “The number of light bulbs you can have in your homes. It does feel excessive. I don’t know how we think through this, but with how it is currently, this feels very intrusive.”

“We followed the state code and the methodology by the state code and just reduced the numbers,” said Goldsmith. “We don’t feel intrusive.”

Councilor Graham Kerslick (D-4th) asked if higher points immediately were the better option. Goldsmith said that today, eight points for residential might be reasonable, but commercial buildings, which have higher energy loads and where heat pumps are not at cost parity to natural gas, would be the issue. Lansing’s gas moratorium was brought up favorable during public comment, but the truth is more nuanced. Residential projects were fine. But the town and village also lost over two hundred jobs from industrial and research firms that relocated (MACOM) or decided not to build there.

There was clearly enough support among council for an accelerated timeline to move up the 2025 ramp-up to the end of 2022 or 2023, but not enough support to do a ramp-up right away, and given impacts on commercial structures and employers, there didn’t seem to be support to raise the mandatory point minimum. The PEDC was nervous about moving without more time to digest their options, given the disparate groups of commenters and the flow of emails coming in about the IECS.

“This is so complicated, we’re all trying to wrap our heads around it…there really has to be some significant education and outreach about this. It does start to affect peoples’ lives and make changes to things they’re used to. We need outreach so this doesn’t come as a shock to people who are used to a certain way of living,” said Murtagh.

The PEDC proposed the council all meet as a “Committee of the Whole” with an invitation to the whole Common Council at the March 17th PEDC meeting to discuss the IECS further. Many questions remain, including impacts on Cornell and those pages of questions and concerns it submitted, effects on commercial properties and employers, and on affordable housing and on homeowners. The breadth of impacts of the code supplement was weighing on their minds, and it’s looking like more time is required before the IECS is ready to head to Council.

Community Choice Aggregation

Also discussed last night was a presentation on “Community Choice Aggregation” courtesy of Cornell Cooperative Extension’s Terry Carroll, their Clean Energy Community Coordinator. Community Choice Aggregation (CCA) is bulk buying by groups of municipalities for energy supplies, either electric or natural gas.

If you’ve looked at your utility bill, you know customers can choose any choice of electricity supply. As the local power company, NYSEG will always be responsible for energy delivery. Those who don’t bother to choose their energy, about 80% of us, let NYSEG choose it on their own, so it ends up being a mix of sources dependent on when NYSEG buys the latest power generated, which varies depending on hydroelectricity flows, coal and gas supplies, sunny and windy days (solar/wind), and so on.

What a CCA is that municipalities can pass a local law to buy on behalf of their residents and small commercial accounts, so the municipality is choosing the electricity for the 80% of residential utility customers who don’t choose on their own. So if the city of Ithaca passes a CCA law, it can choose a cleaner energy supply than what NYSEG conventionally provides customers who don’t go out of their way to choose their electric source; NYSEG still delivers the electricity either way. About 61 communities in the state are currently operating under CCAs with 170,000 customers, and 38 of those are on 100% renewable energy supplies. The more municipalities that are involved locally as a coalition, the more buying power a CCA has because it’s a bigger customer base.

The tradeoff is that the inter-municipal power purchasing agreements underlying CCAs can be complicated, and on some days it can be more expensive per kilowatt than conventional NYSEG supplies, but on other days it may cost less. It’s a backdoor way to get everyone on 100% renewables without making them actively have to choose to do it. There is also an administrative cost, though it is intended to be largely self-supporting.

Carroll said “conversations are still ongoing” and NYSERDA, the state’s clean energy research authority, is offering grant money to develop CCAs, and memorandums of understanding will be requested from municipalities declaring intent to work together to compose a CCA. But at the moment, Carroll and CCE were just looking for a word of support.

“If we could have more information of the financial commitment for support, I think that’s important, otherwise it looks like an innovative and thoughtful program,” said councilor Brock. The PEDC was interested in learning more as plans are better developed, so expect this CCA idea to come before the committee again later this year.