A new regional building code will likely ensure that homes constructed across the Pikes Peak region are more energy efficient. But those improvements will come at a cost, adding several thousand dollars to the price of a new home, builders estimate.
The latest edition of the regional building code recently cleared two hurdles when it was approved late last month by the Colorado Springs City Council and El Paso County Board of Commissioners, signaling the near culmination of a more than two-year process to bring the rules in line with newer national standards.
Officials say the revisions - made at a time when the region is experiencing a widespread shortage of affordable housing, and concerns are rising nationwide about carbon dioxide emissions - have drawn an unprecedented level of debate.
The final product is seen as a compromise between the area's housing industry, which pushed to keep housing prices low, and local environmental advocates who argue that the energy-saving measures will pay for themselves by helping property owners save on utility bills in the long-run.
The new code, approved by the Pikes Peak Regional Building Commission last fall, was OK'd by the Monument Board of Trustees last week. Before the updated rules take effect, they must be approved by the Regional Building Department's five other jurisdictions: Palmer Lake, Manitou Springs, Fountain, Green Mountain Falls and Woodland Park.
The department aims to have the new code in place by June, said Roger Lovell a regional building official. It will not affect existing structures, only new construction and additions or renovations to existing ones, Lovell said.
"This was completely negotiated across the board. In my mind, we codified what the industry agreed to," said county Commissioner Mark Waller, who voted in favor of the changes and sits on the Building Commission. "I think some of these energy efficiency standards didn't need to be added at all. All it does is drive the cost of housing up."
Exactly how much it will cost builders to follow the new code remains a question. Potential price hikes are hard to pinpoint because the complicated list of rules offers many different avenues for compliance, Lovell said.
While much of the cost increase will be fueled by the new efficiency requirements - which mostly have to do with how air tight a home is - a few other improved health and safety standards might also jack up home prices, Lovell said.
Colorado Springs builder Classic Homes says the new code will likely result in a price increase of $5,000 to $6,500 per home, depending on the size of the structure. About $3,000 to $4,000 of that will pay for efficiency upgrades, said Greg Ralphe, the company's director of architecture and product development.
For builders that already incorporate energy-saving measures, such as those certified by the nationally-recognized Energy Star program, there could be little or no additional costs associated with the new standards, Ralphe said. As for other companies, estimates are "all over the map," he said.
A representative with locally-based Vantage Homes told county commissioners last month that the new code would likely increase the cost of a new home by $2,200 to $5,000, depending on the size and type of home. Challenger Homes estimates that figure at between $5,000 and $10,000, said Lori Rhodes, director of purchasing for the Colorado Springs builder.
Housing industry representatives say even an incremental increase in the overall price of a home can make a difference in whether a prospective buyer can afford it. A 2016 study by the National Association of Home Builders found that for every $1,000 that the price of a Colorado Springs home rises, 275 households are "priced out" and can no longer qualify for a mortgage.
The new code's effects on the price of multifamily homes is unclear. If building becomes more expensive, that could result in higher rents.
"Broadly, we maintain that every increase in construction costs impacts the rent rates," said Laura Nelson, executive director of the Apartment Association of Southern Colorado, who was not familiar with the proposed new code.
One of the most significant changes will require an independent third party to test the amount of air that leaks out of a home using what is known as a blower door test, which Ralphe said is likely to cost builders $400 or $500 per home.
Another expensive proposed requirement would mandate that return air systems be enclosed in ducts, meaning builders will no longer be able to create air passages using studs and dry wall, Ralphe said.
"If we weren't required to make these changes, we wouldn't be making them all," he said. "Our preference would be to tick off a smaller number of improvements at a lower cost to keep things more affordable."
The regional building code is revised every six years to incorporate provisions of more recent versions of the International Residential Code, International Energy Conservation Code, and other widely-recognized standards. Regional Building staff began working on the latest edition of the code in 2015.
Other jurisdictions, including Pueblo County, Denver, Fort Collins and Boulder, have adopted the International Energy Conservation Code unamended or with minor changes, said Jim Riggins of the Green Cities Coalition, an organization that promotes sustainability in the Pikes Peak region.
Some of the provisions in that code didn't make it into the new regional code because builders feared they would be too costly.
Riggins, however, pointed to a study, commissioned by the U.S. Department of Energy, showing that adopting some of the improvements might pay for themselves in a few years.
The report shows that, in Colorado Springs, the increase of construction costs - from a home built to an earlier version of the International Energy Efficiency Code to a home built to the 2015 version - could be recouped from energy savings in about four years.
"The most critical metric to look at is not the modest increase in the cost of the house, but the total cost of ownership. And the total cost of ownership comes down dramatically with a robust energy code because of the month-to-month savings," Riggins said. Much of the energy savings will stem from measures included in the new regional code related to controlling the amount of air that escapes a building -- which Riggins calls the "single largest factor" in energy bills. The new code will also include measures required to ensure that the home is being ventilated properly - so that fresh outside air is entering the home consistently, but at a controlled rate.
Contact Rachel Riley: 636-0108