Centric Design Studio's Staff Summary of Last Week's AIA Webinar on Finding Money for Sustainable Funding

On June 4, Nakita Reed, an architect with Encore Sustainable Design, and Mark James, a developer with Urban Green, gave a webinar discussing how to receive sustainable funding for an architecture project. As an architect, it is imperative to know at what point funding will cease before getting underway. In many cases, a project will only have enough funding to reach the creation of construction documents and not proceed any further. Also, an architect should know the different avenues he/she can help the project receive funding through, and there are four main sources: (1) historic tax credits, (2) grants, (3) rebates, and (4) C-PACE. The extent of any architectural project is completely dependent on the extent of funding dedicated to that project.

Historic tax credits can provide a significant amount of funding for a project. The program promotes for the rehabilitation of buildings that are determined by the Secretary of the Interior, through the National Park Service, to be "certified historic structures (CHS)." If a building is declared as a CHS, a 20% income tax credit is available for its rehabilitation from the federal government. However, many states also offer state and local historic tax credits up to 20% as well, meaning that a CHS rehabilitation project in one of these states offering these programs could receive up to 60% funding for the project, 20% coming from each level (federal, local, state).

Grants, rebates, and C-PACE are other supplemental forms of funding that can help further proceed a project. Grants for sustainable design can be found from sources such as DSIRE, Foundation Center, and Reconnecting America, yet they can take a substantial amount of time to receive and possibly set back any target dates. Rebates tend to be fairly minute individually, but many rebates can add up to provide a good chunk of money towards the project. The architect, however, must provide the money up front and then receive the rebate money after the fact, which may not be possible in some cases. Finally C-PACE (Commercial Property Assessed Clean Energy) is a growing company through Connecticut Green Bank that provides financing solutions that allows for green energy upgrades to be paid for over time. As C-PACE expands, it can provide a very viable solution for the implementation of sustainable design on a larger scale.

Although there are other sources of sustainable funding or "green money," there are many challenges it faces, such as a limited pool of investors, false perceptions of risk analysis, scarce and competitive funds, and the fact that most funding programs are for rehab projects such as the historic tax credit program. Sustainable funding will generally only provide about 5% of a projects funding, therefore the project must be considered feasible without this funding. Sustainable funding can come from programs such as Fannie Mae and Freddie Mac, the Department of Housing and Urban Development, the Department of Energy, state and city housing agencies, and the Department of Transportation.

There are a few strategies an architect can use to increase his/her chances of receiving green money. Keeping in mind the fact that most funds come after project completion as a rebate, the architect must show a measurable impact from the sustainable upgrades that were implemented to receive any funding. The architect should also have a green outcome strategy, coupled with a design for that strategy, and furthermore share this strategy with funders and stakeholders who can evaluate
and see a significant impact resulting from the green technologies. Finally, the architect should be able to explain how green investments from these different parties can produce the expected outcomes that have been stated.

In summary, funding for green design is becoming ever more prevalent as society moves towards a sustainable future. Many more sources are becoming accessible for architects, owners, and contractors in order to proceed with their projects, but the burden is placed on these groups to sort through the different options. Sustainable funding will always be in supplement to other sources of funding, but it can very well provide the extra necessary finances to move a project along on its course to completion.