SAVING GREENBACKS WITH GREEN REMODELING
by John Bauman
SpiralWorks – Finding A Niche
The current economic crisis has hit all sectors of the building and remodeling industry, challenging businesses and individuals to adjust to the changing climate or risk becoming one of the many victims of the recession. Contractors and business owners who practice green building and remodeling have an especially hard challenge as consumers focus more on their budgets then ever before, and are less likely to go green for green’s sake. The Willamette Valley is part of what many call the “Green Bubble,” a place where attitudes informed by an ethic of environmental stewardship are more readily evident than most regions in the nation. Still, only those green builders and remodelers who can find a long-term niche, keep operating expenses under control, and can tap into a network of clients and professionals are likely to survive.
Cassie Curtis is one example of a professional who has built her expertise and passion into a successful small business. Cassie owns SpiralWorks Contracting in Eugene, a “small remodeling and painting business, with a focus on eco-friendly methods.” Growing up in Eugene, Cassie has long been focused on the health and sustainability of local communities and local economies. She makes the choice to shop at Jerry’s and locally-owned businesses instead of large national chains. “I practically drive by Lowe’s and Home Depot to get to Jerry’s, and fuel is not cheap,” says Cassie, “but for me, the local weighs over local fuel costs. I will spend a few extra dollars to shop at Eugene Hardware.” Cassie is opposed to what she terms the “Walmartization” of communities, citing Walmart as an example of a large, impersonal business that keeps their workers at minimum wage with no benefits and little chance of advancement. The fact that many such businesses actively undercut local businesses by consciously underpricing competing products certainly helps Cassie’s conviction that local economies suffer when national chains dominate.
When Cassie began painting professionally, she became concerned about the fumes, wondering why it was necessary to use a respirator. This curiosity spurred her to learn about toxins in paints and finishes, finding the source in volatile organic compounds (VOCs). When she started her own business, SpiralWorks Contracting, in March of 1998, she became a loyal customer of Miller Paint, one of the first companies to carry low- and no-VOC paints. She was also drawn to Miller’s Oregon roots and the fact that they are employee-owned.
Eartheasy, a website dedicated to issues of sustainability, reports that indoor air quality is one of the top five hazards to human health, according to the Environmental Protection Agency. Indoor air is, on average, three times more polluted than outside air, and the leading causes of this pollution include paints and finishes. Paints and finishes can release toxic emissions years after initial application. VOCs have been considered essential to high quality paint until fairly recently. New manufacturing techniques have allowed for the production of high quality low- and no-VOC paints from a number of manufacturers. Interested readers can explore the Eartheasy site for examples of such paints, and further details.
Cassie is in her 15th year of business with SpiralWorks, and much of her business “has morphed into remodeling,” so she splits the bulk of her time between interior/exterior painting and remodeling, and also does color consultation. She does a fair amount of bathroom remodels, explaining that “It’s a niche I fell into – it’s a good place to learn, because you can learn about every aspect of running a remodel. You’ve got plumbing, electrical…now I do more and more dry wall.” The larger green construction companies, she believes, were more interested in new home building than remodeling prior to the recession.
SpiralWorks, like many businesses, suffered during the onset of the recession. According to Cassie, 2009 and 2010 were very slow, and 2011 showed signs of improvement. She believes that the ups and downs in her business are due to the depressed economic climate, and also to the inevitable choices that her clientele, primarily working class/middle class families, must make between what is “green” and what is feasible budget-wise. Cassie says that part of her job is to inform her clients about the durability of more high-quality components, since reliability is part of what comprises a sustainable remodel. It comes down to helping clients make a decision that mixes the “right things to do” with what is right economically for one’s family.
Part of this decision-making process involves the choice to use high-quality paint, whether to use low-VOC or no-VOC products, consideration of the quality of the paint, where the paint is manufactured, what the paint company culture is like, and what role, if any, the company plays in the local community. All these factors make up a “sustainable” choice for a client.
Rainbow Valley – Adapting and Flourishing
Chip Radebaugh and Alec Dakers are the Assistant General Manager and Partner, respectively, at Rainbow Valley Design and Construction in Eugene. Alec is a graduate of the Department of Planning, Public Policy and Management at the University of Oregon, with an emphasis in green community design. His father, originally from Scotland, has been a builder for 57 years, so Alec has been immersed in the trade since birth. He came to Rainbow Valley 13 years ago. Chip, having earned an MBA and a law degree, arrived at Rainbow Valley as a consultant on development budgets, and, he says, “worked myself into a job.” Alec says that Chip made himself indispensable and Rainbow Valley had no choice but to hire him full-time. Chip previously worked on green building projects in Summit County, Colorado, and was instrumental in building a green commercial building in partnership with the Colorado Renewable Energy Society. Each of the three phases of the building process won Green Building of the Year in Colorado.
Rainbow Valley began as a cooperative business, and won the first solar energy award in Eugene in 1973. The company was subsequently featured in Mother Jones magazine. Back in those days, before “sustainability” and “green” become buzzwords and marketing terms, Rainbow Valley had to be a “stealth builder,” according to Alec. Rather than speaking to clients about environmental stewardship or the ethics of green choices, they spoke of the value of energy efficiency and improved indoor air quality. Alec believes that “even if you don’t care about the people in China, you care about what is happening with your kids, so indoor air quality is not a hard sell for most people.” In response to a question about the negative labels some people attach to green concerns, Alec thinks that “it does seem like ‘liberal agenda’ is attached to it from a political or philosophical standpoint, but everybody’s into energy efficiency – makes it a lot more palatable. The broader pieces of green like environmental stewardship, those are still somewhat hard for people to understand or really care about.”
The challenge for green builders and remodelers is often rooted in negative connotations of what it means to be “green.” In the purest sense, “green” transcends political or ideological identity and affiliation, focusing primarily on questions including “how can I make my money go farther with long-range strategies” and “how can I create a more healthy living environment within the constraints of my economic situation?”
Clients who associate “green” with labels such as “liberal” or “socialist” or “hippie” miss the point. As Alec explains, the way to move these clients through the unwarranted fear of “green” is to do what Rainbow Valley began by doing, “stealth” building and remodeling. Rainbow Valley focuses on determining what is important to the client and responding to that. “If energy efficiency is important to them and being green isn’t,” says Alec, “we’ll focus on the energy efficiency part.” To help move clients through the process, they use analyses to show that only considering the upfront cost is short-term thinking – instead, the analyses are used to illuminate life cycle costs and payback periods. Further, says Alec, “There’s certain things we do in every project that are green, and the clients don’t know it and don’t care, but it’s just the way we do business.”
Rainbow Valley conducts their business affairs in the same way, according to Chip. When they decided to put photovoltaic (PV) panels on the company roof, they did an analysis and determined the value of the decision. Chip did a net present value calculation (the difference between the present value of cash inflows and the present value of cash outflows) to consider factors such as tax credits, rebates, savings over time, and electricity you are selling back to the utility company, in order to make the decision.
When working with clients, says Chip, “We can run similar analyses on our solar hot water systems. We can go out there, measure exposure, see how much sheathing is on the rooftops, and see what their gains are going to be, dependent on their hot water usage, and say, for instance, ‘your payback period on a straight money calculation is 5 ½ years.’ That helps tip the scales.”
The growing use of energy audits also helps companies like Rainbow Valley make the case for green alternatives in remodeling. Anytime you can show the money saved, says Alec, the sell is easy. “When people can see how it affects the pocketbook, it’s a motivation to do something different. Energy is the easiest sell. Anytime you can show somebody, ‘if you just did this your payback would be this, it’s basically money in your pocket after that,’ then, that’s an easy sell.”
To help clients reach decisions, Rainbow Valley puts emphasis on education, including energy analyses, product knowledge, and phase analysis. They will take a client through all parts of the process, all the options, from excavation/foundation through design and building/remodeling, with breakdowns and choices throughout.
One of the primary strengths of a green construction company like Rainbow Valley is the integration of talent within the firm. Designers, project managers, builders/contractors, and the crews are all in-house. The company focuses primarily on remodeling these days, but according to Alec, even in boom times remodeling comprised 70-75% of their business. At least 50% of their work today is bathroom and kitchen remodels. As Chip says, even if people aren’t doing as many 80k master suite additions, they’re still doing 10k bathroom remodels.
Even a solid long-term company like Rainbow Valley has faced challenges during the recession. They were “green before it was cool to be green,” says Chip, and after 40 years, their client base numbers in the thousands. Most of their work comes from repeat clients and referrals. The number of jobs has remained steady for Rainbow Valley, but the jobs are smaller. The company saw a sharp drop-off in jobs from the end of 2008 to the end of 2009, and slow but steady growth since that time. Aggressively reducing expenses and overhead costs, engaging small handyman jobs, forming a wood floor division, and staying the course on the company’s green philosophy and practice, has allowed Rainbow Valley to survive a recession that has claimed many green entrepreneurs.
Chip believes that green remodeling is beginning to boom, as evidenced by the increasing green remodel market in Portland. “It will take a bit longer to get to Eugene,” he says, “but it’ll get here.” Alec cites several studies that show “Remodeling is the greenest thing you can do.” Remodeling, he says, is greener than building new green houses by a large margin. Remodeling is harder for houses built after the 1960s, he says, since the materials and construction quality have tended to decline since that time. Fundamental problems exist in 1970s and 1980s houses that didn’t exist in earlier built homes.
Both Chip and Alec believe that LEED will continue to be a primary measurement tool, despite the documented critiques of the system. Primarily, they say, LEED is a selling tool for builders. Homeowners are less likely to be concerned about certifications, instead looking for more basic aspects in a house. “As a rule,” says Alec, “most people like things that look beautiful, so green things are an easy sell.” Though, for some people, adds Chip, “if there’s no tax credit involved, they’re not interested.”
One of the growing demands that Rainbow Valley engages is for outdoor living spaces. The construction of these spaces ranks third in popularity for clients behind kitchen and bathroom remodels. Clients are looking to develop outside areas with fireplaces and sometimes kitchen spaces.
Like Cassie at SpiralWorks, Alec and Chip consider green practices and products as part of a larger mindset of the concept of sustainability. Rainbow Valley Design and Construction focuses on the local community by sourcing materials from local and/or responsible suppliers, and treating employees right by paying a living wage and benefits. The result is a durable local and regional company with a loyal workforce, well situated to weather difficult economic times.
Green Rising – Working Toward A Vision
Robin Wengert of Green Rising Construction in Salem represents a mixture of current green practices and visionary passion. Robin sees his work as a green contractor as a means to an end, a goal grounded in nothing less than a radical re-envisioning of what a suburban neighborhood could look like.
Robin started his business 4 ½ years ago, and saw the bottom fall out of his practice one year later. Fighting through lean times, he kept his focus on his long-term vision of a new kind of local community, with an emphasis on shared resources, common holdings, and self-sufficiency. Robin looks to Pringle Creek Community in Salem as a model, where building green, integrating living spaces with natural spaces, empowering a localized economy, conserving and reusing natural materials, and providing more efficient transportation options are just some of the foundational beliefs and practices underlying a community explicitly manifesting sustainable living.
With Pringle Creek as inspiration, Robin is actively working to develop residential subdivisions sustainably, working with residents to rethink how they live and interact with each other, remodeling and updating older dwellings to make them more energy-efficient and durable, taking down fences and converting spaces to shared backyard gardens, establishing community centers in houses that require radical updating and repairing – in short, to take a collection of individuals in separate dwellings living near each other and creating a mutually-beneficial communal locale wherein residents work to enrich themselves and each other.
Born and raised in Springfield, Oregon, Robin started working in construction after high school. He traveled to Arizona and earned a computer-aided drafting and design degree, and then attended the Planning, Public Policy and Management program at the University of Oregon. Family demands kept him from graduating, and he went into the remodeling business. As he watched the sustainability movement gaining momentum, he became dissatisfied with business as usual, and began studying the LEED and net-zero homes that were being built. This led him to question the overwhelming emphasis on new green home construction. What about all the existing housing, he thought, why don’t we focus on the resources already in place instead of using up vast stores of resources on new buildings? “Look at all these old homes that are in need of repair to begin with,” says Robin, “Why not take that repair and find a way to provide a plan that allows people to make a long-term goal of bringing these houses from where they are to where they need to be.”
One way to address the needs of older houses is through a mechanism that, thus far, has primarily been applied to new homes, the Energy Performance Score (EPS). According to the green certification organization Earth Advantage, EPS is being used on a voluntary basis for new homes in Oregon along with pilot programs for existing homes in Seattle and Bellingham in Washington. Pilot programs are also being initiated in cities in Massachusetts, Virginia, and Alabama.
One critique of the EPS is that it burdens older homes that don’t have the advantage of more recent energy-efficiency upgrades. Robin’s vision addresses this critique: “What we do about it is we work together as a community to try to help everybody bring their houses up. It’s not about one person or one person’s home. The kind of commitment I have as a business owner is to find any way I can help people thrive. It’s not just about providing an income for employees…but if I can create a financial plan for somebody, or help them create a financial plan which over seven years allows them to put one improvement in their home, save the money from that energy, and put it into an account to do the next improvement on the home, save some more money into the account to upgrade their home…that’s one avenue, helping people budget for these things so that if ultimately the existing home market is killed, they’re not sitting high and dry, they’ve done some of the work.”
Robin finds great satisfaction in “making a finished product shine. It can be tile, it can be carpentry trim work, it can be helping somebody who had a dream envision their dream and then helping them create it.” Robin clearly is passionate and energized primarily by the people he works with, his clientele. If he can successfully satisfy a client’s needs, he knows he can come back in ten years and find that “I haven’t just built a project, I’ve built a long-term relationship.”
In true optimistic fashion, Robin sees the challenges of the recession as a good thing for small business owners like himself. People, he says, aren’t as willing to just give money away to any professional to accomplish a project. Instead, he says, “they’re much more discerning about not only what they’re doing, but why they’re doing it and who they’re doing it with. Word of mouth tends to do a lot more in today’s economy than it used to.”
People are still looking for bathroom and kitchen upgrades, according to Robin, and they are more focused on their return on investment (ROI). Comfort issues also rank high, with indoor air quality a main concern. Efficiency upgrades, such as furnaces, air conditioners, water heaters, tankless water heaters, and solar panels, are becoming more common as prices come down and supplies grow. Making the choice to install a green system for heating or cooling is becoming easier if you can show the client how they will save money and contribute to their local community through such a choice. “When I propose a project for somebody,” says Robin, “I always give them a choice. Here’s the sustainable side, here’s the traditional side, and we can work somewhere in between there. Let’s talk about your budget. It’s a taboo subject for most contractors, never ask about their budget, never ask about how much money they have to spend. Needs, Wants, Desires – those are the three things you have to talk to somebody about.”
Green contracting and remodeling have never been more popular, even in the midst of perhaps the greatest economic downturn of our time. However, the choice to go green is now often less about lifestyle or ethical conviction. Rather, decisions resulting in green systems upgrades and green remodeling are simply an example of smart economics, grounded in long-term financial strategy. These decisions carry the bonus of healthier living spaces for families and less negative impact on local communities and ecosystems.
John Baumann is a college professor at the University of Oregon, a vocalist and guitarist with Satori Bob, a real estate agent with Windermere RE, and a freelance writer. Somewhere in there he raises his son, feeds the chickens, and volunteers widely.
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