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Green Buildings

Why Green Buildings?

Green buildings use resources-energy, water, materials, and land more efficiently and effectively and they provide healthier environments for working, learning and living. By building green, developers can save money, reduce construction costs and creating sustainable buildings. Owners save money by reducing operation and maintenance costs and lowering utility bills. That's why New York is taking the lead to ensure that new buildings are designed and constructed to save energy and minimize their impact on the environment. New York is among the first states in the nation to offer a tax incentive program for developers and builders of environmentally friendly buildings. In turn, this has opened a market for new technologies and provided clean, healthy places to work and live. This innovative program has become a model for other states and communities and has clearly demonstrated New York's commitment to saving energy and protecting the environment. New York State, with the strong support of the real estate, environmental, business and labor communities, passed into laws measures intended to encourage building owners and developers to design, construct and operate buildings that are more in harmony with the environment. Green buildings are more earth-friendly because the buildings minimize the negative environmental consequences by: lessening changes to the local natural environment; using recycled or recyclable materials; incorporating renewable and energy efficient power generation systems; using water resources more efficiently and producing less waste. Green buildings provide employees with a healthier indoor work environment by effectively controlling outdoor air ventilation systems and using alternative paints, finishes, adhesives, furniture and fabrics that do not negatively affect air quality.

Who's Involved?

The New York State Department of Environmental Conservation (DEC) is currently updating 6NYCRR Part 638, the regulations that govern New York State's Green Building Tax Credit program to reflect amendments made to section 19 of the tax law as part of the 2005 budget bill. The New York State Energy Research and Development Authority (NYSERDA) continues to provide technical assistance to DEC especially with regard to the technical components of the regulations. NYSERDA also provides technical and financial assistance to those interested in building "green."

Summary of Major Changes to the GBTC as a Result of Legislation Passed in 2005

  • The new legislation provides another $25 million for credit component certificates to be issued from the years 2005-2009 (Period two) allowing tax credits to be received in the years 2006 through 2014.
  • For Period two, there is a $2 million cap per credit component certificates in aggregate per building.
  • Any taxpayer receiving credits in Period one cannot seek additional credits for the same building in Period two
  • The original legislation (Period one) allowed applicants to apply for a Credit Component Certificate in years 2001-2004. The new legislation (Period two) allows applicants to apply for a Credit Component Certificate from 2005-2009.
  • Taxpayers who are issued an Initial Credit Component Certificates for Period two have nine taxable years (2006-2014) to claim the credits.
  • This legislation includes two contingencies that are not included in the existing law:
    • If under Period two, the Initial Credit Component Certificates have not been issued for the entire amount of $25 million by the close of 2009, the program will be extended into 2010 in an attempt to exhaust the allocation.
    • For Period one and Period two, if a taxpayer issued an Initial Credit Component Certificate is unable to claim all of the credits provided pursuant to the certificate, the unclaimed amount of credit could be allocated to either a taxpayer who already has been issued an Initial Credit Component Certificate or to other taxpayers who could apply for and be issued an Initial Credit Component Certificate(s).

Current Status of the Green Building Tax Credit

Period one - the Green Building Tax Credit (GBTC) program was signed into law on May 15, 2000. The legislation received strong support from various environmental and public health organizations, as well as the real estate and construction industries. The Green Buildings Tax Credit program regulations (6NYCRR Part 638), which establish the standards that must be met in order to qualify for the tax credit(s) during Period one, became effective as of May 22, 2002.

DEC began accepting applications on September 30, 2002 and awards have been made on a first come-first served basis. Seven buildings have been issued Credit Component Certificates and the seven certificates account for the entire $25,000,000.00 of Green Building Tax Credits allocated to this program during Period one.

Period two - new legislation was recently passed in 2005 to amend the Green Building Tax Credit Program and provides an additional $25 million in credits with the aggregate amount of credit components permitted for each such building being $2 million. Under the new legislation, the DEC has five years, from 2005 through 2009, to accept applications for and issue initial credit component certificates for the additional $25 million. The existing GBTC regulations are being updated and applications for credit component certificates for Period two will not be accepted until the updated regulations are promulgated.

Green Buildings Tax Credit - 6NYCRR Part 638 Regulation Updates:

The Department must update 6NYCRR Part 638, the GBTC regulations before applications can be accepted for the $25 million allocated for Period two. Changes will include:

  • updates to make the regulations consistent with the 2002 NYS Energy Construction Conservation Code;
  • updates to make the regulations consistent with the 2003 NYS Uniform Fire Protection and Building Code;
  • clarification of the language regarding carbon monoxide alarms;
  • eligibility for the refrigerant tax credit component for refrigeration equipment that uses refrigerants that is based upon language from the United States Green Building Council LEED Green Building Rating System for New Construction & Major Renovations (LEED®-NC) Version 2.2, Energy & Atmosphere Credit 4: Refrigerant Selection.
  • other changes as DEC deems necessary.

Important Notice

It is anticipated, that based on the delay caused by having to update the regulations, DEC will not be able to accept Period two applications for the initial Credit Component Certificates until the updated regulations are promulgated.

Despite the delay, buildings and/or tenant spaces that have a final certificate of occupancy issued in taxable years beginning on or after January 1, 2005 (that meet the updated regulations) will be able to apply for a Credit Component Certificate.

Continue to check this website for updated information about the updates to GBTC regulations and opportunities for public review and comment.

For More Information...

Contact us at:
625 Broadway
Albany, NY 12233-1750
phone: 518-402-9469
FAX 518-402-9168

U.S. Green Building Council (USGBC)

The U.S. Green Building Council (USGBC) is the premier forum for the nation's experts on green building, and its LEED rating system is the defacto standard for green building in North America. By collaborating with all sectors of the building market, USGBC New York and its members are united by a common purpose: to transform the way buildings are designed, built and operated and to create environmentally responsible, profitable and healthy places to live and work.

The USGBC aims at not only new buildings, but also existing ones. If every new building is built green, the environmental and health impacts of buildings will remain. All new buildings increase the demand for energy, water, and other resources. While a new green building can reduce the magnitude of these impacts, the environment is still a little worse off than it was.

To learn more about the U.S. Green Building Council (USGBC), link to their website at http://www.usgbc.org. To help further promote the green initiative in New York City, link to their website at http://www.usgbcny.org.

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