Press Release Summary:
Draft legislation of "Reduce Energy Bills at Home Act" seeks to modify existing .30/.30 tax credit criteria to selectively mirror ENERGY STAR standards, but reduces current 30%/$1,500 available credit to 10% with cap at $200. Rich Walker, President and CEO of AAMA, believes specific provisions of current draft do not serve as effective incentive for homeowners looking to make energy-efficient home renovations.
Original Press Release:
AAMA Seeks Better Provisions within Energy Efficiency Legislation
On October 1, Senator Olympia Snowe (R-Maine) and Senator Jeff Bingaman (D-NM) jointly released draft legislation that seeks to modify the existing .30/.30 tax credit criteria to selectively mirror ENERGY STAR standards, but severely reduces the current 30%/$1,500 available credit to 10% with a cap at $200. Additionally, the bill attempts to incentivize homeowner purchases of windows meeting strict R5 standards by implementing a 30% income tax credit, capped at $1,000. The "Reduce Energy Bills at Home" Act would extend the tax credits for two years. Rich Walker, president and CEO of the American Architectural Manufacturers Association (AAMA) has spoken in favor of this type of legislation, but believes that specific provisions of the current draft of the legislation don't serve as an effective incentive for homeowners looking to make energy-efficient home renovations.
Unfortunately, level one of the proposed legislation attempts to replace the currently available 30% / $1,500 tax credit, which is scheduled to expire on December 31, 2010, with a 10% credit to be capped at $200. Furthermore, the Snowe/Bingaman legislation allows the credit for windows which meet the current ENERGY STAR North Central and South Central Performance Criteria. However, to meet the criteria for the tax credit in the Southern climate zone, the bill calls for a U-factor of .42, not the .60 required by ENERGY STAR. The legislation also dictates an SHGC of .55 to qualify in the Northern climate zone, while ENERGY STAR does not enforce an SHGC in this part of the country.
Level two of the Snowe/Bingaman bill seeks to authorize a 30% credit for purchases of windows meeting the stringent specifications of the DOE's R-5 program. This credit would be capped at $1,000 per homeowner and scheduled to expire on December 31, 2012.
AAMA president and CEO, Rich Walker, commented, "The untimely and poorly administered EPA Lead Renovation, Repair and Painting (LRRP) regulations have increased the cost of window installations to as much as $200 in some locations. Coupling those additional installation labor costs with an average $150 window purchase, the consumer would pay $350 and receive a paltry tax break of only $15. This is clearly not enough of an incentive to drive consumer sentiment toward energy-efficiency improvements and subsequently will do little to spur job growth.
"The credits offered within this draft legislation to induce homeowners to make vitally important energy-efficient upgrades," Walker stated. "Any legislation that does not sufficiently address the prohibitive increase in labor costs associated with the LRRP cannot be considered as a viable tool to promote energy-efficiency or claim to spark job growth. AAMA will contact Senators Snowe and Bingaman to ensure that our position on the importance of modifying the existing tax credit to include all windows and skylights meeting ENERGY STAR criteria and amending the tax code to extend this credit through 2011, are considered in any future legislation."
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and educational programs for the fenestration industry.(SM)