Green Guide to the Massachusetts Governor’s Race

As I did prior to the Special United States Senate election in Massachusetts in January, I have put together a green election guide to the candidates for Massachusetts Governor, based on statements they have made on the issues of energy and the environment. The four candidates running are incumbent Democrat Governor Deval Patrick, Republican Charles Baker, Democrat turned-independent State Treasurer Tim Cahill and Green-Rainbow Party candidate Jill Stein. I have a personal preference in this race but I will not be endorsing any of the candidates in this space. I wanted to provide a source of information on where the candidates stand on issues surrounding Green and Sustainable principles. The information I used for this guide is from the candidates’ websites, news articles and campaign literature. Each candidate’s website is hyperlinked and you can be directed to the sites by clicking on each candidate’s name. As we all know, there is a lot at stake in this election, here in Massachusetts, and nationally, so whomever you choose to vote for, please don’t forget to vote on Tuesday, November 2!

Charles Baker, Republican For Governor

Charlie Baker “believes we have a responsibility to protect and preserve our natural resources for future generations” and believes Massachusetts “can and must be a leader in promoting strong environmental policies.”

Baker, who says he is concerned about the effects of climate change, would take a deliberate, measured approach to investing in renewable energy sources. His would be a two-pronged approach, that first focuses on getting the state’s fiscal health in order and then investing in new green technology jobs and working to reduce energy costs.

“I believe that renewable energy is an important investment in our future. Massachusetts is uniquely poised to take advantage of alternative energy sources, which have the potential to save taxpayers and businesses money on their electric bills and will reduce our dependence on foreign oil. Cutting energy costs is another way to make Massachusetts more affordable for families and businesses.”, Baker states on his website.  Baker points out that the cost of electricity in Massachusetts is double the national average. Because of the higher cost to ratepayers and businesses, Baker cautions against moving too quickly toward more costly alternatives, but sees a measured strategy where wise investments in wind, biomass, and solar power alternatives will steadily slow the reliance on fossil fuels. “The price of these energy sources can not make Massachusetts’ already uncompetitive energy picture even worse.”, Baker states.

Baker also says he is committed to strong public support for aggressive energy efficiency advocacy and Green technology. He does oppose the wind farm project off of Nantucket known as Cape Wind that has the support of incumbent Governor Patrick.

Summing up his message on the topic, Baker states, “We need a balanced approach to energy policy that includes a reliable, cost-effective portfolio of conventional and renewable energy sources. We must do whatever we can to reduce our dependence on foreign oil, and to reduce our reliance on non-renewable energy sources.”

Timothy Cahill, Independent For Governor State Treasurer Tim Cahill believes that the “green” sector of the economy could help Massachusetts move past these tough economic times, but he cautions that too much government activism in support of costly alternative solutions should lead the citizens to ask the question, “how much will it cost?” Cahill believes that market driven growth of renewable energy and government support for a diverse portfolio of alternative options is the way to go. Cahill criticizes the 2008 “Green Communities Act” filed by Governor Patrick because he believes Massachusetts taxpayers are already overburdened enough and that the Green Communities Act has tacked on hidden increases in consumers’ utility bills. He points out the significant added cost of renewable energy and claims that currently energy companies are allowed to hide the extra cost on utility bills. Cahill, referring to that extra cost to consumers, as a “Green Tax”, believes that it will cost consumers in the several millions of dollars over the next few years and continue to skyrocket in the years to come. Calling it Governor Patrick’s, “pet project”, Cahill labels the Cape Wind project a perfect example of an “irresponsible approach” to renewable energy investment. Cahill points to the estimated $2 billion to construct the project and the cost to transmit the power from the wind farm to the consumers and concludes that it will likely cost consumers close to $5 billion over what they would pay without Cape Wind.  ”The contract between National Grid and Cape Wind ultimately leaves the ratepayers footing the bill for a project that simply can’t compete with conventional energy.”, Cahill states.  He also said, “We must strive to seek common sense solutions to answer questions involving renewable energy diversification. The focus must be placed on maximizing return on investment rather than pursuing pet projects. Each taxpayer investment must be undertaken with a keen eye on total cost and total return. We should not tolerate wastefulness.” Cahill says he supports an approach that focuses on natural gas and nuclear power as alternatives to fossil fuels and says he supports the relicensing of the Pilgrim Nuclear plant in Plymouth. He accuses the Patrick Administration of dragging its feet on renewing the license while pursuing costly alternatives to nuclear power. Cahill states, “Economic and geopolitical realities suggest that nuclear energy and natural gas must be integrated into our renewable energy portfolio. We must strive to seek out solutions that provide the state with both clean and cheap energy. We cannot afford to settle for one without the other.” Deval Patrick, Incumbent Democrat Governor Governor Patrick has used his focus on energy policy and the environment as a highlight of his campaign and a way to distinguish himself from his opponents.  He points to several accomplishments, including the successful passage of the Cape Wind project. Patrick is the only candidate to support Cape Wind, which might not have won passage without the support and assistance of the governor. “We ought to drive toward a new industry in Massachusetts to become a global center around alternative and renewable energy. The technologies and the products and services, I believe if we get that right, the whole world will be our customer. We have all the capability here in terms of the concentration of brain power and venture capital and that whole innovative tradition and it is one of the reasons why I do support the wind farm in Nantucket sound.”, Patrick has said. Patrick points to exponential increases in the usage of solar and wind power in Massachusetts and his Administration’s advocacy on behalf of those alternative energy sources as an accomplishment of his first term and vows to continue to foster a friendly environment for the growth of those sources. ”Solar power is a key component of our clean energy future.” The project is, “an innovative new model to bring renewable energy–and the jobs that come with it–across the state at the lowest cost possible.” Patrick’s website states that Massachusetts has become the national leader in clean energy policy and touts the nation’s strongest laws to reduce greenhouse gas emissions. The Governor also claims that his energy efficiency programs will invest $2 billion over three years, and provide $6.5 billion in savings for consumers. Governor Patrick also points out his commitment to preserving the Commonwealth’s open space. In 2008, he signed an environmental bond bill that allocated over $100 million per year for the next decade toward state forests and created the largest land conservation program in the history of Massachusetts, protecting 75,000 acres of open space. Jill Stein, Green/Rainbow for Governor Dr. Jill Stein says she favors solar, wind and hydropower energy and some forms of geothermal and ocean energy as alternatives to fossil fuels. She supports wind based energy solutions in theory but says she opposes the Cape Wind project off of Nantucket Sound because of the size and cost of the project. On her website, Dr. Stein focuses a great deal on her opposition to existing and proposed bio-mass power plants, stating, “logging wood for electricity is neither clean, nor green,” and further states, “Biomass energy is not carbon neutral, contrary to the claims stemming from faulty accounting. And claims of its climate benefits have not considered the extremely short time period in which we must reduce atmospheric greenhouse gas concentrations to avert climate catastrophe. The period is too short to permit forest regrowth to restore neutrality after a forest is burned.” Dr. Stein has been campaigning on a platform that includes a call to foster an attitude that promotes the economy and the environment by creating green jobs. “A jobs bonanza is there for the taking in new jobs in weatherization, conservation, energy efficiency, renewable energy, sustainable local food production, and recycling  - among other areas. And as we reduce energy costs to families and businesses, a multiplier effect takes hold,  because our dollars start circulating within the local economy rather than being sent abroad to import oil.”, Stein said. In a campaign brochure, Stein charges the Patrick Administration with promoting sham solutions for climate action and states that the Patrick climate bill, “has no firm targets or teeth.” and criticizes Patrick for initiating harmful biomass, clean coal, incineration, and sprawl projects in his first term as governor.

Massachusetts Senate Candidates on Environment and Climate Change

One of my most viewed blog posts to date was the compilation of viewpoints on the environment by the candidates for US Senate to replace Ted Kennedy before the primary. It in fact has been the most viewed post this week, despite the fact that it was written back in November. With that in mind, I decided to post the remaining candidates’ information in this post today. Please be mindful of the fact that this information is from the candidates’ websites and thus any disparity in the length and depth of each response is based solely on what was available. At the end of the post, I have provided some links to relevant news stories from the campaign.

The implications of the outcome of this election are enormous on many issues. No matter who you support, please remember to get out and vote!

On Tuesday, January 19, Massachusetts voters will decide who will represent us as Junior Senator in a Special Election to succeed Senator Edward M. Kennedy. While there are many issues to consider in this election, this blog has a primary focus on real estate and Green and Sustainable living issues. Therefore I have compiled a primer on energy and the environment issues from the candidates.

Scott Brown (R), Wrentham, Massachusetts State Senator      website

I support common-sense environment policy that will help to reduce pollution and preserve our precious open spaces. I realize that without action now, future generations will be left to clean up the mess we leave. In order to reduce our dependence on foreign oil, I support reasonable and appropriate development of alternative energy sources such as wind, solar, nuclear, geothermal and improved hydroelectric facilities. I oppose a national cap and trade program because of the higher costs that families and businesses would incur.

Martha Coakley (D), Medford, Massachusetts Attorney General      website

Martha recognizes that climate change is one of the most pressing moral issues of our time. Our planet is in trouble. Martha believes protecting our environment must be a priority, not only for today but for future generations.

As Attorney General, Martha enforced the state’s environmental laws, helped spur the clean up and redevelopment of contaminated brownfields throughout the state, and led the way nationally on landmark environmental cases.

In Washington, Martha will support policies that reduce carbon dioxide emissions and other pollution that causes climate change. She will fight to halt global warming, support legislation that creates a national market-based program to reduce global warming pollution, and promote investments in clean energy.

As Attorney General, Martha led the way nationally in challenging Bush administration policies that prevented states from proactively reducing global warming. In Massachusetts v. EPA, the Attorney General’s Office and others challenged the U.S. Environmental Protection Agency’s refusal to regulate greenhouse gas emissions from motor vehicles pursuant to the federal Clean Air Act. In a victory, the Supreme Court ruled that it was the responsibility of the EPA to regulate greenhouse gas emissions.

Martha also worked with the Obama administration to overturn a Bush administration regulatory action to the Endangered Species Act, which sought to relieve federal agencies and applicants for federal permits from having to consider the effects of increased greenhouse gas emissions on species and habitats under the federal Endangered Species Act.

In Washington, Martha will continue her commitment to combat global warming by supporting the American Clean Energy and Security Act of 2009, as well as the more recent Clean Energy Jobs and American Power Act that Senator Kerry introduced. These comprehensive bills will make the United States a leader in the fight against global warming.

Martha knows that pollution from electric utilities, oil companies, large industrial sources and other entities, is responsible for most of the global warming emissions in this country. As Attorney General, Martha participated in the implementation of the Regional Greenhouse Gas Initiative (RGGI). Martha supports a national cap-and-trade program that will utilize a market-based approach to control pollution. Martha believes that by providing economic incentives to industries for achieving emissions reductions, we can achieve superior environmental protection and give businesses both the flexibility and direct financial incentives they need to find faster, cheaper and more innovative ways to reduce pollution.

In Washington, Martha will support the national Global Warming Pollution Reduction Program, proposed in the American Clean Energy and Security Act of 2009.  Martha knows that the key to both our economic security and protecting our environment is a commitment to invest in clean energy technologies.

Martha knows that investments in cost effective energy efficiency represent the quickest and least expensive way to address the country’s growing energy demand. Energy efficiency can avoid some investment in infrastructure, can potentially lower the price of electricity in wholesale markets, can help reduce emissions of harmful gases and can offer lower total bills for those who participate in programs. As Attorney General, Martha supported the expansion of cost effective energy efficiency programs. As a member of the Commonwealth’s Energy Efficiency Advisory Council, Martha worked on groundbreaking policies aimed at saving ratepayers billions of dollars.

Martha reached a Settlement with NSTAR, the Union of Concerned Scientists and the Conservation Law Foundation for Long-Term Wind Contracts and Green Power that anchored the development of two 30 MW wind farms and provided an option for NSTAR’s customers to purchase renewable power for a portion or all of the energy portion of their bill.

Martha reached a Settlement with Western Massachusetts Electric Company for the development of the Commonwealth’s first utility grade solar project in the state that will result in the development of 6MW of solar power, developed at the least cost, in Western Massachusetts.

Joseph L. Kennedy (I – Libertarian) Needham, Businessman      website

I would consider myself an Environmentalist and I am a strong advocate of green initiatives. Having said that I also realize that the greatest threat to the Environment is not the Oil Companies, Chemical Companies or Nuclear Power Plants. The Greatest Polluter in America is the US Government. Currently Government departments have sovereign immunity when it comes to pollution. My initial objective, were I elected, would be to make Government responsible for cleaning up its own mess.

NEWS STORIES ON ENVIRONMENT AND CLIMATE CHANGE FROM THE CAMPAIGN

WCVB TV Article, 12/15/09 “Brown, Coakley differ on cap,trade rules”.

Boston Globe Article, 12/16/09 “Coakley, Brown spar on environmental policy, economy.”

Boston Globe Article, 12/17/09 “Environmental Differences”.

U.S. Senate Candidates on The Environment & Energy Policy

On Tuesday, December 8, Massachusetts voters will decide the nominees for the January 19, 2010 Special Election to succeed Senator Edward M. Kennedy. While there are many issues to consider in this election, this blog has a primary focus on real estate and Green and Sustainable living issues. Therefore I have compiled a primer on energy and the environment issues from the major candidates for the Democrat and Republican nominees.

Scott Brown (R), Wrentham, State Senator      website

I support common-sense environment policy that will help to reduce pollution and preserve our precious open spaces. I realize that without action now, future generations will be left to clean up the mess we leave. In order to reduce our dependence on foreign oil, I support reasonable and appropriate development of alternative energy sources such as wind, solar, nuclear, geothermal and improved hydroelectric facilities. I oppose a national cap and trade program because of the higher costs that families and businesses would incur.

Michael Capuano (D), Somerville, U.S. Congressman      website

Mike Capuano strongly believes that we must address climate change before it is too late. He supported the Climate Stewardship Act to create a cap and trade system and reduce greenhouse gas emissions. He supported the SAFE Climate Act, to freeze 2010 emissions at 2009 levels, gradually lowering the targets to reduce emissions below 1990 levels. Every year that we fail to take action only makes the changes required to stop global warming that much more drastic. Mike is hopeful that this year we will finally see real progress on this serious issue. The House recently passed a bill to freeze emissions at 17% below 2005 levels by 2020 and slowly reduce them to 83% of 2005 emissions by 2050. He fought to strengthen the bill by:

• Advocating for strong building code provisions so that new homes and commercial buildings are energy efficient,
• Pushing for a strong renewable electricity standard to require that a certain percentage of a power company’s portfolio came from renewable sources,
• Calling for more funding to be dedicated to green jobs.

Mike is a proponent of green jobs. Massachusetts, with its perfect mix of technology, education, and research centers stands to uniquely benefit and be a national leader in the rapidly expanding green economy. Clean technology jobs are already one of the largest sources of employment in Massachusetts and also one of its fastest growing sectors. Mike supported authorizing $125 million per year for green jobs training in the Energy Independence and Security Act of 2007 and joined with his colleagues in the House asking that the authorized green jobs training program be fully funded in fiscal year 2009. Mike and his colleagues succeeded in getting $500 million for green jobs training in the stimulus bill, and billions more for energy and environmental research that will directly create thousands of new green jobs.

Mike supports increasing Corporate Average Fuel Economy (CAFE) Standards. Mike believes that we must increase our efforts to produce alternative fuels, including wind energy. Because of this, he supports projects like Cape Wind. Mike has long advocated for the Low Income Home Energy Assistance Program (LIHEAP), fighting every year for adequate funding. This advocacy finally paid off when Congress approved $5.1 billion for the LIHEAP program in fiscal year 2009, $2 billion more than the Fiscal Year 2006 appropriation, which itself was a record amount of funding.

Martha Coakley (D), Medford, Massachusetts Attorney General     website

Martha recognizes that climate change is one of the most pressing moral issues of our time. Our planet is in trouble. Martha believes protecting our environment must be a priority, not only for today but for future generations.

As Attorney General, Martha enforced the state’s environmental laws, helped spur the clean up and redevelopment of contaminated brownfields throughout the state, and led the way nationally on landmark environmental cases.

In Washington, Martha will support policies that reduce carbon dioxide emissions and other pollution that causes climate change. She will fight to halt global warming, support legislation that creates a national market-based program to reduce global warming pollution, and promote investments in clean energy.

As Attorney General, Martha led the way nationally in challenging Bush administration policies that prevented states from proactively reducing global warming. In Massachusetts v. EPA, the Attorney General’s Office and others challenged the U.S. Environmental Protection Agency’s refusal to regulate greenhouse gas emissions from motor vehicles pursuant to the federal Clean Air Act. In a victory, the Supreme Court ruled that it was the responsibility of the EPA to regulate greenhouse gas emissions.

Martha also worked with the Obama administration to overturn a Bush administration regulatory action to the Endangered Species Act, which sought to relieve federal agencies and applicants for federal permits from having to consider the effects of increased greenhouse gas emissions on species and habitats under the federal Endangered Species Act.

In Washington, Martha will continue her commitment to combat global warming by supporting the American Clean Energy and Security Act of 2009, as well as the more recent Clean Energy Jobs and American Power Act that Senator Kerry introduced. These comprehensive bills will make the United States a leader in the fight against global warming.

Martha knows that pollution from electric utilities, oil companies, large industrial sources and other entities, is responsible for most of the global warming emissions in this country. As Attorney General, Martha participated in the implementation of the Regional Greenhouse Gas Initiative (RGGI). Martha supports a national cap-and-trade program that will utilize a market-based approach to control pollution. Martha believes that by providing economic incentives to industries for achieving emissions reductions, we can achieve superior environmental protection and give businesses both the flexibility and direct financial incentives they need to find faster, cheaper and more innovative ways to reduce pollution.

In Washington, Martha will support the national Global Warming Pollution Reduction Program, proposed in the American Clean Energy and Security Act of 2009.  Martha knows that the key to both our economic security and protecting our environment is a commitment to invest in clean energy technologies.

Martha knows that investments in cost effective energy efficiency represent the quickest and least expensive way to address the country’s growing energy demand. Energy efficiency can avoid some investment in infrastructure, can potentially lower the price of electricity in wholesale markets, can help reduce emissions of harmful gases and can offer lower total bills for those who participate in programs. As Attorney General, Martha supported the expansion of cost effective energy efficiency programs. As a member of the Commonwealth’s Energy Efficiency Advisory Council, Martha worked on groundbreaking policies aimed at saving ratepayers billions of dollars.

Martha reached a Settlement with NSTAR, the Union of Concerned Scientists and the Conservation Law Foundation for Long-Term Wind Contracts and Green Power that anchored the development of two 30 MW wind farms and provided an option for NSTAR’s customers to purchase renewable power for a portion or all of the energy portion of their bill.

Martha reached a Settlement with Western Massachusetts Electric Company for the development of the Commonwealth’s first utility grade solar project in the state that will result in the development of 6MW of solar power, developed at the least cost, in Western Massachusetts.

Alan Khazei (D), Brookline, Non Profit Executive   website

Alan Khazei’s Plan to Create Clean Energy Jobs & Stop Climate Change

Confront the crisis. Seize the opportunity. Create Jobs.

Solving the crisis of climate change provides an opportunity for a new clean energy jobs revolution. America’s dependence on fossil fuels poisons our environment, weakens our economy, and undermines our national security, but also presents opportunities to create new businesses through clean energy solutions, which have the potential to create millions of jobs for Americans. Massachusetts is a pioneer in cutting-edge science and technology, and we can create high-skill, high-paying jobs that help preserve our environment while growing our economy.

A Summary of Alan’s 6-Point Plan:

1. CREATE CLEAN ENERGY JOBS: Pass clean energy legislation now, put a price on carbon pollution, commit to a reduction in C02 emissions, create clean energy jobs and promote energy efficiency.

2. INVEST IN RENEWABLES: Support the development of clean renewable energy technologies, including Cape Wind and technology neutral biofuels.

3. TRIPLE R&D: Triple US investment in energy research to $15 billion a year and allow citizens to invest in Clean Energy Independence Bonds.

4. CLOSE THE COMMERCIALIZATION GAP: Create a Clean Energy Institute to accelerate the commercialization of new energy technologies from the research lab to new industries, businesses and jobs.

5. IMPROVE EFFICIENCY: Promote and reward energy efficiency through education, incentives and public-private partnerships.

6. END BIG OIL SUBSIDIES: Pay for these investments to retake America’s lead in the clean energy revolution through reducing fossil fuel subsidies, rebalancing federal R&D spending, carbon permit revenues and returns from clean energy co-investments.

Steve Pagliuca (D), Weston, Venture Capitalist/part owner of Boston Celtics   website

We must continue to invest in clean, renewable energy and set an example to the rest of the world. Right now, the US is second only to China in greenhouse gas emissions – this has to change. I am proud of our efforts in Massachusetts to make us a more energy responsible state, and I support Governor Patrick’s programs such as the Green Communities Act.

Massachusetts: A Leader in Energy Policy

Massachusetts is a leader in energy policy. We rank 48th in per capita energy consumption and derive 30% of our energy from renewable and alternative sources like hydro, nuclear and wind.

In addition, Massachusetts is also an industry leader in clean technologies. We need to continue to invest in clean technology in order to protect our environment, reduce our dependence on foreign oil, and spur growth in our economy.

Investing in Clean Technology

I strongly believe that our continued investment in clean energy technologies will create jobs in Massachusetts, help reduce our reliance on coal and lower our energy costs. Massachusetts is uniquely suited to benefit from federal efforts to spur growth in this sector of our economy. I support Congressman Markey’s bill because I believe that it is a positive step forward towards energy independence. In addition, I support Cape Wind – potentially America’s first offshore wind farm.

Energy and Environment

I support common-sense environment policy that will help to reduce pollution and preserve our precious open spaces. I realize that without action now, future generations will be left to clean up the mess we leave. In order to reduce our dependence on foreign oil, I support reasonable and appropriate development of alternative energy sources such as wind, solar, nuclear, geothermal and improved hydroelectric facilities. I oppose a national cap and trade program because of the higher costs that families and businesses would incur.

Jack E. Robinson (R), Duxbury, Businessman     website

GOAL: Cleaner & greener environment with lower energy costs. The Environment can’t ruin our Economy, but the Economy shouldn’t ruin the Environment.

 

• Promote renewable and sustainable energy sources like nuclear, wind and solar. Support Cape Wind.
• Oppose “Cap-and-Tax” proposals, but support goal of reducing greenhouse gas emissions by 20% by 2020.
• Kerry-Boxer Senate “Cap & Tax” Bill needs to be reworked. Add to Kerry-Boxer bill an additional credit mechanism where for every one ton of carbon emissions released into the atmosphere, a polluter must invest in new clean/green projects that will remove four tons of carbon from the air by 2020 (4:1 removal ratio).

The Newly Extended and Expanded Home Buyer Tax Credit

Late last week, President Barrack Obama signed a law that extends the $8,000 first time home buyer tax credit to the end of April 30, 2010.  It also introduced a brand new $6,500 credit to homebuyers who have lived in their current home for at least five years and are seeking to relocate.  Below are more specifics on the credits:

Who is Eligible
-First-time homebuyers, who are defined by the law as buyers who have not owned a principal residence during the three-year period prior to the purchase, may be eligible for up to an $8,000 tax credit.
-Existing homeowners who have been residing in their principal residence for five consecutive years out of the last eight and are purchasing a home to be their principal residence (“repeat buyer”), may be eligible for up to a $6,500 tax credit.
-All U.S. citizens who file taxes are eligible to participate in the program.

Income Limits
Homebuyers who file as single or head-of-household taxpayers can claim the full credit ($8,000 for first-time buyers and $6,500 for repeat buyers) if their modified adjusted gross income (MAGI) is less than $125,000.
-For married couples filing a joint return, the combined income limit is $225,000.
-Single or head-of-household taxpayers who earn between $125,000 and $145,000, and married couples who earn between $225,000 and $245,000 are eligible to receive a partial credit.
-The credit is not available for single taxpayers whose MAGI is greater than $145,000 and married couples with a MAGI that exceeds $245,000.

Effective Dates
-The eligibility period for the tax credit is for homes purchased after Nov. 6, 2009, and before May 1, 2010. However, home purchases subject to a binding sales contract signed by April 30, 2010, will qualify for the tax credit provided closing occurs prior to July 1, 2010.

Types of Homes that Qualify
-All homes with a purchase price of less than $800,000 qualify, including newly-constructed or resale, and single-family detached, townhomes or condominiums, provided that the home will be used as their principal residence. Vacation home and rental property purchases do NOT qualify.

Tax Credit is Refundable
-A refundable credit means that if the amount of income taxes you owe is less than the credit amount you qualify for, the government will send you a check for the difference.

-For example:
-A first-time buyer who qualifies for the full $8,000 credit who owes $5,000 in federal income taxes would pay nothing to the IRS and receive a $3,000 payment from the government. If you are due to receive a $1,000 refund, you would receive $9,000 ($1,000 plus the $8,000 first-time homebuyer tax credit).
-A repeat buyer who owes $5,000 would pay nothing to the IRS and receive $1,500 back from the government. If you are due to get a $1,000 refund, you would get $7,500 ($1,000 plus the $6,500 repeat buyer tax credit).
-All qualified homebuyers can take the tax credit on their 2009 or 2010 income tax return.

Payback Provisions
The tax credit is a true credit. It does not have to be repaid unless the home owner sells or stops using the home as their principal residence within three years after the purchase.

(Details of the plan provided by the National Association of Home Builders)

 

Realtors® Call on Congress to Extend and Expand Home Buyers’ Tax Credit

I wanted to point out a push by the national, state and local Realtors® associations to influence Congress on the fate of the First Time Home Buyer Tax Credit. I, along with many of the other Realtors® across the nation, have called upon our members of Congress to consider extending the First Time Home Buyers program beyond November 30, 2009 and to consider expanding the program to include all types of future home buyers during the extended period.

What follows is the letter sent to Congressman Richard E. Neal. I urge you all to send your Congressmen similar letters of support of these efforts on behalf of home buyers.

Dear Congressman Neal;

As a Realtor® and a constituent, I can assure you that the $8,000 first-time homebuyer tax credit has definitely been a success. Homebuyer interest and housing sales increased almost as soon as the ink was dry on the tax credit legislation. Today’s lower prices and interest rates appeal to consumers, but it’s been the tax credit that has attracted people to open houses and to homeownership.

That progress could grind to a halt sooner than you think. Congress must act NOW to extend the credit through 2010. Otherwise, uncertainty will return and the market might again be frozen — possibly as soon as October.

A homebuyer is eligible for the tax credit only if the home is “purchased” before December 1, 2009. That means that buyers have to find a house, complete a contract, satisfy any contingencies, secure financing and go to closing by November 30.

Accomplishing those tasks by November 30 will become more difficult with every passing day. In today’s market, it generally takes between 45 and 60 days to go from contract to closing.

The market has improved, but it has not yet fully corrected itself. The credit needs to be extended for an additional period of time and expanded in order to build upon the progress that’s been made. Uncertainty about the future of the credit will dampen consumer demand. The best way to assure continued housing activity is to extend and expand the credit and to do that NOW.

We can’t wait until late in the year to see what happens. Consumers will drop out soon if they can’t predict what’s in their future. Please act NOW to extend and expand the credit through 2010.

Sincerely;

Jason A. Burkins
Realtor ®
Wilbraham, MA

Massachusetts Homebuyer Tax Credit Details.

Last month, the Commonwealth of Massachusetts unveiled a first time homebuyer tax credit loan program that will allow home buyers to borrow up to $8,000 in advance of the federal tax credit for homes purchased with a MassHousing loan before December 1, 2009. 

 “These loans will both help prospective homebuyers achieve the comfort and stability of homeownership for their families, and also stimulate the Commonwealth’s economy through increased home sales, while reviving neighborhoods impacted by foreclosure,” Governor Deval Patrick said at a press conference announcing the program.

In essence this loan program will allow homebuyers to use the federal tax credit as a funding source at closing for home purchases. The federal program sets the maximum available credit at $8,000 and the credit is applied to the homebuyers 2009 federal tax return.

Homebuyers who take advantage of the program will have the principal and interest payments on the tax credit loan deferred from the time of closing until the loan due date of June 1, 2010. If the loan is not repaid in full by June 1, 2010, the loan will be amortized for 10 years at the same interest rate as their first mortgage loan.

Qualifications for the First-Time Homebuyer Tax Credit Loan include:

• Applicants must be first-time homebuyers using a MassHousing mortgage through a MassHousing-approved lender.
• Homebuyers must use the home as a principal residence for a minimum of three years (the Tax Credit Loan cannot be used for investor properties).
• Homebuyers must purchase a one, two, three or four-family home from a seller unrelated to the buyer by November 30, 2009.

MassHousing’s home loans feature safe and affordable fixed rates and include unique benefits such as MassHousing’s MI Plus™ mortgage insurance, which will help pay the borrower’s monthly principal and interest payments for up to six months in the event of a job loss. MassHousing mortgages offer competitive interest rates, low- and no down payment options, and discounted rates for lower-income borrowers.

Cap & Trade Impact on Real Estate Industry

Today’s Post is a reprint of an interesting article on the recent Cap & Trade legislation that comes out of Congress and its impact on the real estate industry. The article is from the Reuters News Service published on July, 29, 2009.

How the Cap-and-Trade Bill Could Transform the Real Estate Sector

By Leanne Tobias - Leanne Tobias 

A heads up for real estate professionals: H.R. 2454, the cap and trade legislation approved by the U.S. House of Representatives on June 26, if passed into law, would have a profound effect on the real estate sector. 

To prepare the following summary, I’ve reviewed the text of the legislation and drawn heavily on a July 14 article authored by my good friend Michael Zimmer with the law firm of Thompson Hine, LLP. Mike co-chairs the American Bar Association’s renewable and distributed generation resource committee and serves as vice chair of ABA’s Carbon and Energy Trading and Finance Committee.

Key real estate-specific provisions of the House cap and trade bill are the following:

• National building energy efficiency targets would be established by the Department of Energy (DOE), linked to baseline standards set for commercial buildings under the American Society of Heating, Refrigerating, and Air-Conditioning Engineers (ASHRAE) Standard 90.1 – 2004 and for homes under the 2006 International Energy Conservation Code. [Note: The legislation also permits the national standard to be based on a recognized national consensus standard. Presumably, this would be Standard 189.1, the model building energy efficiency code being developed through an ANSI standard-setting process headed by ASHRAE, the Illuminating Engineering Society of North America and the U.S. Green Building Council.]

• Upon enactment of the bill, new commercial and residential buildings would be required to achieve 30 percent improvements in energy efficiency relative to baseline. By January 1, 2014, new residential buildings would have to improve energy efficiency by 50 percent; commercial buildings would be required to achieve 50 percent improvements relative to baseline by January 1, 2015. Additional reductions in energy use would continue in subsequent years at 5 percent additional savings every three years. DOE could accelerate or lessen these standards on the basis of lifecycle cost analysis. The baseline under consideration is 2005.

• Within a year of enactment of the federal legislation, state and local governments would be required to adopt the national code or revise their building codes to meet or exceed the federal standards. For states in which building codes are adopted by local governments, the state would be required to document that appropriate local building codes were adopted by jurisdictions representing 80 percent or more of the state’s population. Compliance would be verified by the Department of Energy. Competitive awards for local government, disbursed through the federal Department of Housing and Urban Development (HUD) would be used to assist localities with building code enforcement.

• The federal sale of carbon allowances would be used to fund building retrofit initiatives to promote energy efficiency, to be known collectively as the Retrofit for Energy and Environmental Performance (REEP) program. REEP would be administered by the U.S. Environmental Protection Agency (EPA), in consultation with DOE and the U.S. Department of Housing and Urban Development. REEP funds would be distributed through states and local governments and could be used for the establishment or operation of the establishment of revolving loan funds, loan guarantees, or other forms of financial assistance. [The REEP program is part of a larger effort to pass through to states funds raised by the auction of carbon allowances; this initiative allows state governments to establish State Energy and Environmental Development (SEED) accounts with proceeds raised by carbon allowance auctions.]

• Building energy performance under REEP would be documented through Energy Star Portfolio Manager, the Home Energy Rating System (HERS) rating system, or other energy modeling software approved by EPA.

• A model building energy labeling program would be created by EPA in consultation with the Department of Energy within a year of enactment of H.R. 2454. Labels would be proposed for new commercial and residential buildings and demonstration programs conducted to help develop the model label and to test the usefulness of labeling in additional building types.

• The development of net zero energy buildings would also be funded through demonstration grants.

What are the real estate industry implications of the House cap and trade legislation? If the bill should pass the Senate in substantially similar form later this year (by no means a sure thing) the U.S. real estate industry will be reshaped in the following ways:

• Increasing reliance on building codes (instead of voluntary standards such as LEED) to establish energy efficiency and green building practices.

• A stronger role for the federal government in prescribing building energy efficiency requirements.

• Increasing standardization in building energy performance metrics in the commercial and residential sectors.

• Greater reliance on the public sector and on public-private partnerships in creating and financing building energy efficiency programs.

• Growing employment in green collar jobs related to building energy efficiency.

An unanswered question is whether the increasing importance of building energy efficiency will accelerate real estate industry consolidation. 

It is possible that the combined effect of new building energy standards and energy efficiency labeling will leave under-capitalized building owners — who cannot afford energy efficiency retrofits — at a more significant competitive disadvantage. 

At the same time, the playing field could be leveled by public programs that provide financial assistance directed to smaller commercial property owners and households. 

As Zimmer notes: “The legislation, if enacted, is transformative. Residential and commercial buildings, multifamily and low income housing, new and existing buildings, development and real estate finance will all be impacted. The surprise is how quickly the time frames are proposed. The reasons appear centered on the substantial opportunity buildings offer, with almost 48 percent of all greenhouse gas emissions and 70 percent of projected electricity use over the next decade.” 

Leanne Tobias is founder and managing principal of Malachite LLC, an advisory firm that specializes in the development, leasing, management, financing and certification of sustainable or green real estate on a global basis. Comment online, or write to Leanne about your green real estate thoughts and experiences at greenstimulus@malachitellc.com. She’ll share the best of reader feedback in future posts.