You all may recall I wrote earlier this year that the EPA (environmental protection agency) had issued rules with heavy penalties that required new lead safe practices for renovations and improvements being made on homes built before 1978.
The rule was implemented in 2008 and required that contractors working on these homes have at least one on site employee be certified by the EPA on their lead safe practices and that these new safety standards be implemented on the job site. The rule went in to effect in April of this year and most states had woefully few contractors who had completed the training. Ultimately, the EPA pushed things back a bit and have stated that they will not be enforcing the rules (i.e. fining you out the wazoo) until October but in the midst of this, they have also changed their stance on a key opt out part of the rules.
There were some provisions that allowed opt outs for smaller jobs, if homeowners did the work themselves, if the home had been shown to be clear of lead by a certified lead abatement specialist, OR if the homeowner signed a document stating no child under the age of 6 or pregnant women resided in the home. The aforementioned emboldened opt out has now been removed by the EPA and the NAHB (National Association of Home Builders) is respectfully hacked off.
The NAHB Says
The NAHB has issued a statement basically saying this is a bunch of bunk and is suing. They make some valid points. This will now double the amount of homes affected by the new rules from 38 million to roughly 78 million and the NAHB feels repealing the opt out was premature because the new rule has just gone in to effect so there is no statistical data about whether the current rule is actually helping reduce lead exposure in people or not.
In addition, with estimates per job an average of $2400 in addition to meet the new EPA requirements, you may find homeowners doing the work themselves which could put even more people at risk or simply not doing improvements which hurts an already suffering industry. For example, the window industry in particular, an improvement that homeowners can get energy tax credits for provided they put in qualifying windows would really get hammered.
At a whopping $70 to $125 per window in additional costs, the benefit of the energy tax credits would be completely ixnaed and then some. In addition, there are still pitifully few contractors certified as of yet and with the amount of homes that now would fall under this new rule, it could make getting compliant contractors difficult for some time, further driving up the costs of remodeling or improvements.
The EPA Says
The EPA has issued their own explanation as to why they have repealed this particular opt out. They report over a million children in the US have elevated lead levels and lead poisoning affects are mostly neurological and irreversible. Even if a child does not reside in the home at the time of the renovation project, there is potential that one could visit and get exposed and the homeowners themselves also need to be protected from their own tightwaddedness.
I personally think that there is concern by the EPA that “flippers” can use the opt out do the renovation without following any of the EPA’s rules on lead and then turn around and sell the house to anyone, including a family with young children. When I initially reviewed the opt outs, I had wondered about this very thing.
The EPA in it’s initial roll out estimated the costs to implement the lead safety standards on average were less than $250 a job, a figure that is substantially different then the $2400 estimated by the NAHB and other trade associations joining them in this fight. So there you have it; a major trade assocition vs. the goverment duking it out over paint.
My Two Cents
Personally, it seems apalling that 32 years after we figured out lead in paint was an issue, it’s still making people sick and those of us who were probably not even people yet are footing the bill to deal with it. Lead is a serious health threat and quite frankly the disclosures we do with our clients are a joke.
Seriously, I give my buyers their little EPA booklet and ALL of my sellers check the box that says they have no knowledge of lead based paint and my buyers sign their side of the document but I don’t see anyone really giving it much thought. To that end, I think the EPA needed to probably take things further than what we have been doing. On the flip side the housing market recovery is tenuous at best.
In addition, the home buyer tax credits are just about done, FHA has jacked up PMI, and so it seems even more regulation is maybe not what we need right now to keep things headed in the right direction. I checked NAR’s website and while they have info about the original rule that went in to effect in April and how it affects us, they have not taken a stance on the repeal of this opt out yet.
If I could see some compromise, it would be to require sellers to disclose whether or not rennovations were completed by a certified contractor using the new lead safe guidelines and accurate information for buyers and Realtors on what that means. In addition, I know there is a lot complaining about big government BUT it seems that since the added expense of implementing these new standards can cost in the thousands and it’s mandatory, it would help if they were at least tax deductible. Regardless, we (I.e. Realtors and homeowners) have a dog in this race so hopefully you all plan on antying up an opinion.
Thoughts? Anyone?
