Eugene approves home energy score

Presenter: The City Council approves a home energy score, even though one councilor said the realtors don’t like it. During a work session Oct. 28, Councilor Mike Clark:

Councilor Mike Clark: My understanding is that the Eugene Association of Realtors were absolutely against the idea of doing this.

I work in this industry everyday, and so I have spoken with dozens and dozens of realtors that can’t believe we would possibly consider doing this at a time like this, when housing is already as expensive as it is. For us to add a mandate that increases the cost of housing, isn’t a benefit to the buyer.

Presenter: Climate policy analyst Danielle Klinkebiel:

Danielle Klinkebiel: We plan to do very targeted outreach to realtors. We established a relationship with the Eugene Realtors Association as well as other realtors beyond that network and so we plan to lean into those relationships and do additional training and support to help guide them through:

What are the requirements? What’s the process? How do you get the score? How do you post it?

So a lot of our outreach and education will be geared towards them and ongoing support. You know, once the policy launches, we plan to have a help desk, so we can be accessible if someone’s struggling, you know, for a specific house or something

Presenter: To explain the home energy score, Danielle Klinkebiel:

Danielle Klinkebiel: A home energy score is an energy assessment tool developed by the U.S. Department of Energy to evaluate a variety of physical and mechanical features throughout a home.

The assessor creates a report that provides a score on a scale of 1-10, based on the energy use of a home—kind of like a miles-per-gallon rating for a car.

The report also includes a lot of other helpful information like estimated energy costs, recommended improvements, and available rebates.

Many other cities, including four in Oregon, have implemented a home energy score disclosure requirement, basically requiring the seller of a home to include the score and report in the online listing when a home is listed for sale so that prospective buyers can view it.

The goals are to increase transparency, educate homeowners about opportunities to improve energy efficiency, and finally, to connect them to incentives that can help finance upgrades.

Most people would only be subject to this when they sell their home, so typically once or twice in a lifetime. And they tend to be guided through this process by a realtor.

The seller would hire a qualified assessor to to complete a score. It costs about $150 for the average Eugene home, and then include that score in the listing. If they qualify for an exemption or a free score, they may need to submit paperwork or a brief application.

If the listing is posted without a score, they would be notified and provided with time to comply. Lack of compliance after repeated notification may eventually result in a penalty.

We recognize that for realtors, this will be another item on the checklist to complete before a home can be listed. And so a lot of our outreach and support would be geared towards them.

Buyers will be able to see the home energy score in online listings and during showings, allowing them to compare homes and inform their offers. Because the score provides different insights than an inspection report or utility bills, it gives buyers additional information when making their final decision.

There are some concerns about adding a cost to selling a home. And there are concerns that there aren’t enough assessors locally.

There were also requests to identify metrics and evaluate the policy over time. City Council at the public hearing asked about ways to offset the cost for low-income sellers. Staff would intend to set aside resources so that sellers below a certain income threshold could apply to get a score at no cost.

We would plan to have several assessors under contract who can provide the service and invoice the city, so that this wouldn’t be something that would slow down or delay the sales process. This is considered best practice and all four other cities approach this.

Presenter: She was asked about the city’s percentage of older homes. Danielle Klinkebiel:

Danielle Klinkebiel: From the ‘Decarb’ report that was published a few years ago, that report says that approximately 49,000 residential units were built prior to 1990, representing roughly 65% of our housing stock, and typical construction features from that time include: little to no insulation in the floors, walls or attic; leaky building envelopes; inefficient heating systems; and single-pane windows.

These features are conditions that can lead to very inefficient energy use and therefore higher energy costs.

One of the concerns we’ve heard throughout engagement is that there aren’t enough assessors. And this is true. It’s because we’ve only had a voluntary program, so there hasn’t been the demand.

We would plan to train up roughly 10-15 new assessors. This is something that Bend had to do and that they were able to do successfully before they launched, so we’d probably plan to replicate what they did.

We also intend to develop broad communication and outreach materials. We know that realtors and others associated with the home sale transactions are really the ones who are going to be at the helm of responding to this requirement, so much of our outreach, education, and support would be targeted towards them.

With the policy, we can reasonably expect that the home energy score disclosure requirement would expand people’s access to information about their home’s energy performance. It would be another tool that connects them to existing incentives, and it would lead homes to slowly become more energy efficient over time.

Presenter: Councilor Greg Evans:

Councilor Greg Evans: So are assessors going to be hired by the city or they’re going to be independent contractors?

Danielle Klinkebiel: That’s a great question. Assessors will be independent contractors hired by the seller, who’s ever selling their home. They would hire an assessor to complete the score.

For the ones who are completing the scores for free, for the lower-income—for families that meet the low income threshold—they would be under contract for the city, and we would hire them to complete the scores for free for that subset of folks who meet the income qualifications.

Councilor Greg Evans: Okay. And what are the training requirements for assessors?

Danielle Klinkebiel: So they need to have a residential contractor license, and then they need to complete an additional training that’s pretty short. It’s about a one- to two-day training in order to get that certification to be an assessor.

Councilor Greg Evans: And what happens if there is some disagreement with the assessor’s evaluation of the home and, someone says, ‘I don’t agree with that?’ How do we deal with challenges to an assessor’s judgment?

Danielle Klinkebiel: There’s a pretty robust process through Earth Advantage. If a specific person wants to dispute their individual score, they can bring it up directly with the assessor. If they still dispute it. After that, they can bring it up to Earth Advantage. And Earth Advantage will review the score and you know, the data that was inputted to verify that it’s accurate or change it if it wasn’t.

If there was a discrepancy or data was entered incorrectly and the score needs to be corrected, there wouldn’t be a cost incurred to the seller. So there is a process lined out already for scores to be disputed.

Presenter: Councilor Matt Keating:

Councilor Matt Keating: I am enthusiastic about advancing this today, and as the only current renter on Council, wh—? Why weren’t renters part of this initial conversation? But recognizing they’re not, what are the next steps for renters?

What’s a reasonable timeline for us to grapple with (what I see as) the logical next step for a home energy score or an energy performance audit for the 50% of us who rent in this community?

Danielle Klinkebiel: That’s a great question. It would have been a much broader engagement effort to also engage renters and landlords. The compliance process would be a little bit different.

You know, Zillow, Redfin, there’s somewhat of a cookie-cutter way to sell a house, whereas the way that houses are rented is not quite as consistent and easy to track compliance for this type of policy.

So that would be sort of another subset of steps we’d have to figure out, and we didn’t have capacity to explore that.

We also thought it made sense to start with time of listing, which is what is before you today, as a way to learn and potentially explore renters next.

Councilor Matt Keating: That’s great. Thank you so much. Count me in as an enthusiastic partner when we come to that point.

How long is an energy score good for? Is it good for a year? Is it good for two years? More?

Danielle Klinkebiel: As it’s written in the ordinance, it expires after eight years.

Councilor Matt Keating: That’s a long time. 

Danielle Klinkebiel: Or if there’s been a major alteration made to the house that would affect the energy usage of the home.

Councilor Matt Keating: How many assessors are there locally? You mentioned that we plan to bring up 10-15. Are there any who have this training at this juncture? How many?

Danielle Klinkebiel: Currently, there’s four assessors serving the Eugene area. And from our research, we know that we need about 15-20 in order to meet the demand that this policy will create.

Councilor Matt Keating: Great. Thank you very much. I urge adoption.

Presenter: Councilor Mike Clark:

Councilor Mike Clark: I’m troubled by this measure for a couple of reasons, and I just want to speak them out loud before we put this into place, which I’m relatively sure we will.

No. 1, we’re passing a new ordinance whether it requires new staff to be hired or not, we’re not certain of. We think it probably won’t, but we don’t know that yet because we haven’t seen the compliance amount.

And I do have a question of staff: Is the administrative intent at this point for those free assessments and the paying the auditor for those free assessments for that monies to come out of the program itself?

In other words: Will we increase the amount of the assessment to each homeowner done in order to cover that amount of money that covers those free ones that are offered? Or is it our intent to have that be city money that we use to pay for those?

Danielle Klinkebiel: The intention was for that to come out of our budget.   Our research shows that we should budget about $5,000 a year to cover those assessments for low-income scores.

So it would not be additional budgeted funds to cover this, and we would not be increasing the cost to regular priced assessments in order to cover the cost for low-income scores.

Councilor Mike Clark: But we’re making a commitment of expending additional city funds—

Danielle Klinkebiel: That’s correct.

Councilor Mike Clark: —we don’t currently do.

Presenter: He explained why he would be voting against the ordinance. Councilor Mike Clark:

Councilor Mike Clark: The information may be a helpful bit of information, and I, for one, am always in favor of buyers having complete and accurate information. I think that’s a bare minimum.

But I believe that this is a great deal more about creating a database of everybody’s home in Eugene than it is about serving buyers and their best interests.

Especially, as Matt points out, that at least half the houses in Eugene aren’t usually for sale to the homeowner, to the occupant, they are for rent to the occupant.

I’m going to vote against this as a result. But I appreciate the conversation.

Presenter: The City Council approves a mandatory home energy score by a vote of 6-1, with Councilor Clark opposing.