Archive for the ‘USGBC’ Category

Are you looking to learn a little more about Cost Segregation, click on this link to view a brief video.

Time:    Friday, October 14 · 10:00am – 10:30am

Location:    Navy Pier, Chicago, IL

More Info:

Join Don McDougall as he presents the EPAct and 1603 Energy Grants – How the Current Tax Codes Reduce the Cost of New Systems by up to 30%. Course ID: ID: 59879, 9315. Session A4: Economic & Energy Impacts. Register online at http://www.energycongress.​com/

Total Tax Deduction of $5,771,823, in Total Identified Expenses, to be applied in Federal Income Taxes by this owner of Nursing Homes in Texas, who implemented our comprehensive Repairs and Maintenance Services to benefit from the results.

“Green schools for everyone within this generation” requires a variety of people with different viewpoints to agree on one vision.  Administrators, architects, parents, politicians and funders not only need to agree on this idea, they all must generate results while representing their groups’ interests.  The question is rarely about the positive impact of greening our schools, but rather on presenting a financially viable solution that satisfies all parties.

Few experts will argue the long term operational, environmental, and academic benefits of a high performing school.  The challenges usually center on funding the capital required to design, purchase and properly maintain the technology.  Weighing and measuring short term costs against long term benefits is a reasonable dialogue that needs to occur, especially when public funds are considered.

Those committed to green schools understand that creating significant results requires creativity, collaboration and ingenuity.  One method utilized to generate additional revenue streams is tapping into federal tax incentives such as those available through the Energy Policy Act of 2005.  This legislation allows architects and engineers the opportunity to capture significant tax deductions for their design work on energy efficient publicly funded projects.  The following stories are examples of how enterprising groups worked together using these tax incentives to make green schools a reality in their communities:

Tax Incentives Subsidize Design/Commissioning Fees

A growing town in Southern California passed an ordinance that all new construction must be LEED certified.  This requirement placed responsibility on owners and designers to determine a way to comply with regulations while considering appropriate design and commissioning requirements. One industrious architect decided to use his EPAct knowledge to differentiate his firm during the RFP phase of a K-5 school.  The firm introduced the tax incentives and suggested using the benefits to pay for design and commissioning fees, ultimately reducing his quote.  Consultants were introduced during the design stage of the project to help maximize the benefits of $1.80 sq/ft.  The required allocation letter was authorized as an addendum to the construction agreement and provided over $35,000 in relief, an EPAct certification, and earned the architect future business with the school district and property owners in the area.

Administration Saves $1.6M in Energy Costs

Progressive architects and administrators are working together to find creative ways to reduce expenses and long term costs.  Electricity is a substantial line-item cost on any school operating budget.  The Superintendant of Schools in a west coast community understood the benefits available to the design firm for meeting the required thresholds.  This knowledge allowed the district and the contractor to work together to maximize efficiencies to reduce long term expenses without additional capital out-lay.  During a major lighting retrofit, the design team was challenged with reducing energy usage for ten schools by an additional 12% originally indicated without exceeding the budget previously established.

The reward: A signed allocation letter for over $400,000 in tax deductions for the firm.

The design team met this goal by allocating additional resources to the project as well experiencing significant out-of-pocket expenses.

The school reduced its expected yearly energy cost by over $15,000 per school, saving the district over $1.6M in energy costs over the next ten years.

The following table shows the savings of the middle school campus for the school district:

In summary: There was no outlay by the School District.

They had no additional cost to the design of the buildings or costs in construction.  They spent nothing to obtain these significant savings.

Over the next 10 years however,  one single school stands to gain $165,080 or more in savings.

This example highlights just ONE of the 10 campuses that this particular School District has either constructed or renovated

For all 10 campuses over the next 10 years the District could realistically save more than $1,650,000, or $165,000 a year.

This example is typical of the savings a School District could expect in a similar situation.

Community Benefits from EPAct

It is not uncommon to find architects entrenched in one community throughout their career.  In many cases, designers help shape the personality of the town or institution by providing design continuity and artistic harmony.  One trusted and respected architect of a college town decided to utilize the incentives to invest in the community that has supported his business for over 25 years.  This architect was prominently involved in the growth of a college town.  Project included renovations, campus housing, new construction and building expansions.  Many of the projects were designed and built to LEED silver and gold specifications.  Due to the concentration on efficient systems, these projects also qualified for tax deductions available through EPAct.   The architect considered the tax benefits, a bonus to the revenue already generated from the projects.  He chose to certify several large projects and used the benefits to help fund and expand the firms’ existing scholarship program to the school of architecture.

EPAct Incentives Solution to Meeting Construction Deadlines

Designing a high-performing school takes the combined effort from several entities.  Architects, MEP firms and general contractors, all play an important role in managing budgets and meeting deadlines.  During construction of a middle school in the Midwest, a series of unfortunate circumstances threatened to delay the opening of the school causing increased costs, and inconveniencing parents, teachers and administrators.  To meet the deadline, all parties would have to invest additional time and resources.  The architect of record and school worked together to determine a solution to properly compensate contractors without adding additional costs.  The architect used the tax benefits to create an incentive plan for timely completion as well as cover overtime costs.  The project was completed on time and on budget without increased costs to the school district or construction team.

What is EPAct

Building components (Shell, HVAC, and Lighting) can qualify for a federal tax deduction of up to $0.60/sf for each system.  These deductions can come about due to new construction or renovation.  To qualify for these deductions, an analysis must be performed by an independent, qualified engineering firm. The savings are calculated using IRS guidelines that are related to ASHRE standards.

It’s Not Too Late

Whether you’re considering renovations, in design stage, or have opened a green school, it is not too late to explore and capture these federal tax incentives.  Contact a qualified, licensed firm with expertise in this area to determine the possibilities available to your firm or community.

Don McDougall and Brian Gilboy are  Directors with Engineered Tax Services, a firm specializing in capturing tax incentives available through EPAct 2005.

For more information, contact

Brian at bgilboy@engineeredtaxservices.com or phone: 847.530.3666.

Don at dmcdougall@engineeredtaxservices.com or phone: 213-280-2266.

Friday, October 14 · 10:30am – 11:30am

Navy Pier, Chicago, IL

Join Don McDougall at the 2011 World Energy Engineering Congress, as he presents the EPAct and 1603 Energy Grants – How the Current Tax Codes Reduce the Cost of New Systems by up to 30%. For details contact http://www.energycongress.com/ for details.

Friday, July 22 · 12:00pm – 1:30pm

TGI Friday’s, Place page, 6200 20th St # 496, Vero Beach, FL 32966

Join Cindy Lucas as she presents the popular Green By Designs Seminar over lunch, hosted by Cross Road Architecture, USGBC South Florida Chapter. For details call Cindy on 954-439-1671.

New Opportunities for Architects, Designers & Contractors

The construction industry is receiving a much needed boost from the State for new construction and major renovations of public buildings throughout Illinois. According to the state budget, over $3.5 billion has been appropriated for K-12 schools, public universities, community colleges and state facilities for the 2011 fiscal year. Architects, design/build firms, and general contractors concentrating on this sector will undoubtedly experience increased activity over the next few years. These capital projects, intended to create thousands of new jobs, come as welcome news to firms who support sustainable design.

Illinois, a nationally recognized leader in promoting sustainability, has passed legislation mandating energy efficient design for all state-funded projects. In 2007, State Legislature passed the School Construction Law, mandating all new construction grants be issued to designs that meet or exceed USGBC’s LEED Silver status or meets Green Building Initiative’s Green Globes Green Building Rating System. Additionally, the Green Buildings Act of 2009 requires construction or renovation of public buildings in excess of 10,000 sq/ft. seek LEED or equivalent certification. Companies bidding on these projects must be qualified to provide the support and resources necessary to meet these conditions.

“Illinois’ capital programs for both new construction and energy efficiency upgrades represent significant opportunities to ensure that new and existing buildings are as energy efficient as possible. This not only ensures wise stewardship of scarce natural resources, but wise stewardship of monetary resources as well. Illinois is to be commended for its leadership in this regard.”

Doug Widener
Director U.S. Green Building Council
Illinois Chapter

The Federal Government also offers significant tax incentives for designers and energy consultants through the Energy Policy Act of 2005. Designers of public buildings may receive tax incentives of $1.80 sq/ft for buildings meeting thresholds for power reduction in lighting, HVAC systems and building envelope. Buildings must be certified by a qualified third-party by passing energy modeling tests on the design of the facility or system. These incentives are independent of state programs and provide significant benefits for projects completed from Jan 1, 2006 through 2013.

Progressive firms who make the decision to concentrate on sustainable design are in a unique position to capitalize on the State’s desire to create new jobs while improving working and learning conditions. Since many of these projects are required to meet energy efficiency standards, firms adhering to state requirements have the opportunity to win new projects and receive significant federal tax deductions as they enter into an improving business climate.

Sources and References:
www.state.il.us/budget/FY2011/FY2011_Capital_Budget.pdf
www.usgbc.org
www.greenglobe.com
Green Buildings Act Public Act 096-0073 (IL, H.B. 1013) 105 ILCS 230 School Construction Law. Section 5-40

Have you started, or do you plan to start, a construction project that involves installation of energy-efficient systems? Please contact us. We can help you maximize the benefits of sustainable practices and other real estate incentives.

Brian Gilboy is a National Director of Business Development for Engineered Tax Services, specializing in client development, relationship management and strategic direction.  He introduces thousands of companies each year to millions of dollars in available tax benefits.  As a successful business owner, company leader and trusted advisor, Brian thoroughly understands the financial needs of a business. When resources are tight, tax benefits found in energy- and real estate-related tax incentives can be a key factor in immediate cash flow and near-term to intermediate growth. Brian has over 15 years of experience helping organizations accomplish business results and maximize profitability through financial and human capital solutions.  During the last 4 years, Brian has partnered with CPA firms, architects, attorneys and real estate investors capture over $50M in tax benefits through cost segregation, Energy Certification, R&D tax credit and WOTC programs. Brian earned a Bachelor of Science degree in Advertising from Bradley University in Peoria, IL. He is actively involved in his community and regularly participates in local ICPAS and USGBC events.  Contact Brian at 847-550-7101 (direct) or via email at bgilboy@engineeredtaxservices.com.