HUD Proposes Energy Benchmarking Requirement for Multifamily Housing

HUD recently issued a notice in the Federal Register requesting public comments on a proposed requirement for owners of HUD-funded multifamily housing to implement energy benchmarking in their properties, consistent with the President’s Climate Action Plan and other Administration and HUD initiatives to improve energy efficiency in HUD-assisted properties.

This new “utility benchmarking” initiative would apply to approximately 2.2 million units across several categories of HUD-assisted affordable housing: developments with Project Rental Assistance Contracts, multifamily properties with mortgages insured by the Federal Housing Administration (FHA), and public housing authorities (PHAs) with more than 250 public housing units. 

Under this initiative, certain providers of HUD-assisted or public housing will begin collecting and reporting on their water and energy use. Benchmarking will guide these property owners and PHAs to make informed decisions, reduce operating costs, and improve building performance over time.

HUD’s proposal seeks to establish procedures for building owners to input utility and energy data into the U.S. Environmental Protection Agency’s free, web-based ENERGY STAR Portfolio Manager®. HUD, building owners, and residents have a shared interest in eliminating energy and water waste while stabilizing operating costs to ensure that taxpayer investments are viable for the long-term. However, HUD is currently unable to effectively analyze the energy and water use patterns, improvement potential, and investment needs of properties in the assisted and insured portfolios.

HUD is dedicating resources to help owners collect, track, and analyze energy data. This includes building a website with tools, case studies, and links to federal resources. This assistance builds on experience with the Better Buildings Challenge (BBC), a voluntary leadership initiative that asks building owners, developers, and managers to make a portfolio-wide commitment to energy efficiency and provide their energy savings data and strategies as models for others to follow.

HUD is proposing the following reporting schedule:

• For HUD-assisted properties with a utility allowance, at the time of a triennial utility allowance baseline calculation;
• For HUD-assisted properties where there is no utility allowance, every third year at the time of financial statement submission;
• Prior to issuance of new FHA mortgage insurance under Sections 223(a)(7), 223(f), and 241(a));
• With a Capital Needs Assessment submission required by the Office of Asset Management and Portfolio Oversight in HUD's Office of Multifamily Housing Programs on a 10-year cycle;
• With a Capital Needs Assessment submission required as part of any enforcement action.

The notice states that these schedules are minimum requirements that do not supersede more frequent reports required by other Multifamily Housing programs. HUD encourages owners to collect data on an annual schedule to achieve more consistent datasets.

Comments on the notice are due to HUD Dec. 5, and may be submitted electronically through the Federal eRulemaking Portal at www.regulations.gov.