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CASE STUDY: EDUCATION – METRO

Energy Efficient Homes Initiative IncreasesHousing Affordability for New HomeownersBy Ross Jackson, Metro CERT Research Assistant • July 2011

How do you help new homeowners financiallybeyond the initial purchase of their homes? Oneapproach is to renovate the homes with energy useand operating costs in mind. Now the questionbecomes what is the best use of limited renovationfunds? City of Lakes Community Land Trust(CLCLT), a nonprofit in Minneapolis committed toproviding housing for low to moderate incomehome buyers, took a proactive approach to this question when they launched their Energy EfficientHomes Initiative.

This initiative helps the organization better integrateand prioritize green building practices in the rehabwork done on CLCLT homes. A Metro CERT seedgrant was instrumental in starting the EnergyEfficient Homes Initiative.

The purposes of a Community Land Trust is to provide access to land and housing to people whoare otherwise denied access; to increase long-termcommunity control of neighborhood resources; toempower residents through involvement and participation in the organization; and to preserve theaffordability of housing perpetually. Though the program specifics vary among different CLTs, thebasic model is the same.

CLTs offer a balanced approach to ownership: thenonprofit trust owns the land and leases it for anominal fee to individuals who own the buildingson the land. As the home is truly their own, it provides the homeowners with the same permanence and security as a conventional buyer,and they can use the land in the same way as anyother homeowner.

In recent years, the majority of CLCLT homes havebeen purchased through a Homebuyer InitiatedProgram (HIP) in which the buyer selects the houseand CLCLT helps them by providing an affordabilityinvestment and rehab. On average, the CLCLTinvests $40,000 into homes to address deferred maintenance; safety and code issues; and environ-mental hazards such as lead.

The CERTs seed grant provided the opportunity toenhance CLCLT’s existing rehab program by integrating energy efficiency measures through aHome Energy Rating System (HERS) analysis. Thefirst step in any building energy efficiency project isan audit. This investigation measures the presentstate of energy use in the home and identifies areasthat need attention. There are a few different typesof home energy audits and CLCLT chose one of themost in depth and detailed, the Home EnergyRating System (HERS).

CERTs PARTNERS

University of Minnesota’sRegional SustainableDevelopmentPartnerships

Eureka Recycling

Southwest RegionalDevelopmentCommission

The Minnesota Project

Office of EnergySecurity, MinnesotaDepartment ofCommerce

CERTs FUNDERS

Xcel Energy’s RenewableDevelopment Fund viaOffice of Energy Security

Bush Foundation

Environment & NaturalResource Trust Fund

Project Snapshot

Project: Pilot Home Energy Rating System (HERS) program for homes purchased throughCommunity Land Trust.

Benefits:Comprehensive understanding of energy efficiency of homes to inform the rehab process.Education for new homeowners to encourageenergy saving behaviors.

Energy Savings: 487,219,564 BTUs/year

Total Cost: $36,000

Partners and Funding: Neighborhood Stabilization Program, MinnesotaHousing Community Revitalization Fund, LeadHazard Control Grant Program of HennepinCounty – Housing, Community Works & Transit,Otto Bremer Foundation, MinneapolisFoundation and Metro CERT ($4,200)

The mission of the CLCLT is to provide and foster stewardship of perpetually affordable home ownershipopportunities for low- and moderate-income familiesthroughout Minneapolis

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“The primary motivation behind HERS was to see if we could do something beyond thenormal energy audit that would help us understand more clearly what a home needed andhow best to invest our resources and provide the biggest return on investment for the homeowner” Staci Horwitz, Program Director at CLCLT, explained.

A HERS analysis offers a comprehensive look at the energy efficiency of a home before, during and after the rehab process. The HERS rater reviews the home to identify its energycharacteristics, such as insulation levels, window efficiency, wall-to-window ratios, the heating and cooling system efficiency, the solar orientation of the home, and the water heating system. Performance testing, such as a blower door test for air leakage and ductleakage, is usually part of the rating. The final HERS report gives a number rating to thehouse (0 – 100), showing how it compares to other houses in the nation, and it includes a listof recommendations on how to improve the building's energy efficiency.

The seed grant money from CERTs was used specifically to pay for HERS energy audits onnew CLCLT properties. The goal was to assess 5 – 10 homes with the CERTS seed grant andto improve the energy efficiency of those homes by 15 - 30%.

Horwitz sees many advantages in using the HERS home energy audit. “The HERS ratinghas been incredibly helpful in educating the homeowners about their home,” says Staci. “It provided us with the understanding we needed to go above and beyond bringing a building to code to create truly energy efficient homes. Having the report informs the dialogue on discussions about energy efficient renovation with the homeowner and alsowith the contractors working on the house.”

Greater Metropolitan Housing Corporation oversees the rehab process and works closelywith the HERS specialist to incorporate the energy efficient measures. Any energy efficientmeasures that are not prioritized but are identified as beneficial to the homeowner, thelongevity of the home, or the energy efficiency of the home will be recommended to thehomeowner for completion over time.

Both parties have a clearer view of the scope of the work to be accomplished and the homeowner knows what to look for when the renovation project is completed. With thehomeowners now empowered with knowledge of their building they are better advocatesfor those projects which give the best return on their investment.

The primary challenge for the CLCLT Energy Efficient Homes Initiative has been implementing all the suggestions from the HERS analyses. Because of funding partner obligations, CLCLT is required to prioritize certain aspects of rehab like replacing windowsdue to the high likelihood of lead contamination even if those strategies have a much slowerreturn-on-investment than other energy efficient elements like insulation. Even with therehab funding being directed at windows, CLCLT met the 15 – 30% goal of improved energy efficiency in each case.

The community education component of the initiative takes place in the form of one-on-onecounseling with homeowners through a post-purchase walk through of the home, a summary of any new controls installed during the rehab and information on maintenance ofmechanical systems.

By increasing the energy efficiency of CLCLT homes, the organization is committing notonly to reducing the carbon emissions in the community, but to the long-term affordabilityof land trust homes by decreasing homeowners’ monthly utility bills.

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Sample HERS Index (left) and diagnotic testing equipment(below)

Home purchased through the CLCLT.

For more information about the City of LakesCommunity Land Trust’s Energy Efficient HomesInitiative, contact Staci Horwitz, Program Director at(612) 721-7556 ext. 18 or email Staci@clclt.org.

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Energy Efficient Homes Program

1) Homebuyer attends informational meeting tolearn about the CLT model when the idea ofenergy efficient homes will first be introduced.

2) Buyer goes through qualification process andidentifies a home to purchase.

3) The CLCLT and homebuyer do an inspection ofthe property with project partners including theGreater Metropolitan Housing Corporation’s(GMHC) rehab specialist, a Hennepin CountyLead Risk Assessor, and a City of MinneapolisConstruction Manager. In tandem with theinspection, a HERS analysis will also be conducted.

4) From the HERS analysis, a rehab scope outlinesstrategies from the HERS analysis for increasingthe energy efficiency of the home.

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