I have been seeing alarmist ads of TV about the American Clean Energy & Security Act of 2009 for some time now, but it took an email from one of my past customers to get me to look into it a bit further. I certainly had no idea that it may have such a dramatic impact on housing and the ability for owners to sell their homes as it appears that it may. A part of the problem is that very few people anywhere, including the Congress, have any real idea of what is hidden in this bill and what impact it might have on everyday life.

The name of the bill is innocuous enough. I mean who can argue that we don't need cleaner energy and that saving on energy use and costs wouldn't somehow make us all more secure. But in this nice sounding bill, as in many things in life, the devil is in the details. The bill, as it was passed by the House of Representatives and sent to the Senate, is 1427 pages long. It has 835 Sections dealing with all sorts of rules regulations and programs. The bill was sponsored primarily by Representative Henry Waxman of California, which in itself explains a lot.

When I received the email from my past client, he passed on some comments that he had received from someone who apparently took the time to read through the bill and highlight the areas that should be of concern to homeowners. Below, in parentheses are a few of his comments. The author has obviously reached his own strong opinions about the bill, so take these with a grain of salt. Since this Arthur has interspersed so much of his personal opinion into the content below, you may wish to go read the bill yourself, which you can do at  http://www.govtrack.us/congress/bill.xpd?bill=h111-2454 . I have also put a complete PDF version on my Web site at http://www.themilfordteam.com/PDF/HR2454_Bill.PDF

Beginning 1 year after enactment of the Act, you won't be able to sell your home unless you retrofit it to comply with the energy and water efficiency standards of this Act.

    H.R.  2454, the "Cap & Trade" bill passed by the House of Representatives, if also passed by the Senate, will be the largest tax increase any of us has ever experienced.  The Congressional Budget Office (supposedly non-partisan) estimates that in just a few years the average cost to every family of four will be $6,800 per year.  No one is excluded.  However, once the lower classes feel the pinch in their wallets, these voters may get a tax refund (even if they pay no taxes at all) to offset this new cost.  Thus you, Mr.  and Mrs.  Middle Class America, will have to pay even more since additional tax dollars will be needed to bail out everyone else.

    But wait.  This awful bill (that very few or no one in Congress has actually read) has many more surprises in it.  Probably the worst one is this:  A year from now you won't be able to sell your house.

    Yes, you read that right.  The caveat is (there always is a caveat) that if you have enough money to make required major upgrades to your home, then you can sell it.  But, if not, then forget it.  Even pre-fabricated homes ("mobile homes") are included.  In effect, this bill prevents you from selling your home without the permission of the EPA administrator.

    To get this permission, you will have to have the energy efficiency of your home measured.  Then the government will tell you what your new energy efficiency requirement is and you will be forced to make modifications to your home under the retrofit provisions of this Act to comply with the new energy and water efficiency requirements.  Then you will have to get your home measured again and get a license (called a "label" in the Act) that must be posted on your property to show what your efficiency rating is; sort of like the Energy Star efficiency rating label on your refrigerator or air conditioner If you don't get a high enough rating, you can't sell.  And, the EPA administrator is authorized to raise the standards every year, even above the automatic energy efficiency increases built into the Act.

Sect.  202:
    Building Retrofit Program mandates a national retrofit program to increase the energy efficiency of all existing homes across America .

    Beginning 1 year after enactment of the Act, you won't be able to sell your home unless you retrofit it to comply with the energy and water efficiency standards of this Act.  You had better sell soon, because the standards will be raised each year and will be really hard (i.e., ex$pen$ive) to meet in a few years.  The Act allows the government to give you a grant of several thousand dollars to comply with the retrofit program requirements if you meet certain energy efficiency levels.  But, wait, the State can set additional requirements on who qualifies to receive the grants.  You should expect requirements such as "can't have an income of more than $50K per year", "home selling price can't be more than $125K,. 

Sect.  204:
    Building Energy Performance Labeling Program establishes a labeling program that for each individual residence will identify the achieved energy efficiency performance for "at least 90 percent of the residential market within 5 years after the date of the enactment of this Act." This means that within five years, 90% of all residential homes in the U.S.  must be measured and labeled.  The EPA administrator will get $50M each year to enforce the labeling program.  The Secretary of the Department of Energy will get an additional $20M each year to help enforce the labeling program. 

Sect.  304:
    Greater Energy Efficiency in Building Codes establishes new energy efficiency guidelines for the National Building Code and mandates at 304(d) that 1 year after enactment of this Act, all state and local jurisdictions must adopt the National Building Code energy efficiency provisions or must obtain a certification from the federal government that their state and/or local codes have been brought into full compliance with the National Building Code energy efficiency standards.

I'm generally not a fan of alarmist rants by people with a particular ax to grind and the author of the comments above may have misinterpreted some things however, this bill appears to have lots and lots and lots of things buried in it that will cost everyone lots of money to comply with in the future. It deserves to be exposed too much more scrutiny than it has received and hopefully the Senate in its deliberate style will find and remove or modify some of the more onerous provisions that the House bill contains. I'm generally in favor of doing things to decrease our use of energy in all aspects of life; however, having the government come into my home and tell me that I must do this or that to improve it's energy efficiency before I can sell it feels more like a home invasion than a helpful program.

The American Clean Energy and Security Act appears to be another misguided attempt by our so-called leaders to save us from ourselves. I think they should stick to passing legislation that lawn mowers need labels that say that one shouldn't stick their hand under the mower while it running. That's still stupid, but at least it didn't cost us much.

I checked to see if this topic has been posted here before and it has, but with surprisingly little follow-up comment. It would seem to me that anyone not already living in California would be at least a little alarmed by the provisions of this bill as they apply to homeowners, especially the need to meet some ill-defined set of energy standards before one is allowed to sell. It will be too late to get up-in-arms after the fact, if this bill passes as it is currently written.