Millions flowing to Cash for Caulkers

Local residents line up for jobs, but some question the costs

By Jim Redden

The Portland Tribune, Feb 4, 2010 (9 Reader comments)

JONATHAN HOUSE / TRIBUNE FILE PHOTO

Ted Snider of EcoTech LLC blows insulation into the attic of a Southeast Portland home last year. Politicians want to spend millions of dollars on such projects to create good-paying jobs in Portland and around the country.

For at least the past 30 years, residential energy-efficiency projects that were sponsored by the government have had one primary goal: reducing heating and cooling costs.

But now, with the economy in the tank, politicians are looking to expand these programs for another reason: jobs. President Obama believes people can be put to work weatherizing homes and installing energy-efficiency upgrades, such as newer furnaces and hot water heaters. He has proposed a Recovery Through Retrofit program — also known as Cash for Caulkers — intended to refurbish 130 million American homes.

Smaller efforts are already under way around the country, partly funded with federal stimulus programs. Locally, Multnomah County has received $4 million to expand its existing weatherization and energy-efficiency program for low-income households. The county has paid private contractors to perform such work since the 1970s.

The city of Portland is also using $1.1 million in stimulus funds to launch a pilot project called Clean Energy Works Portland. It aims eventually to create thousands of jobs by offering easily repaid financing to both residential and commercial property owners.

But the new emphasis on creating jobs comes with a price. Since Multnomah County first accepted the stimulus funds, the average cost of each project has jumped around 30 percent, says Mary Li, manager of the county’s Office of School and Community Partnerships.

According to Li, the county’s costs are up because the federal government is requiring its contractors to pay employees state prevailing wage rates. Before that, contractors decided how much to pay their workers. But prevailing wage rates are set by the Oregon labor commissioner. They tend to be closer to union wages than nonunion wages that most, if not all, of the contractors had been paying.

“They were paying somewhere between minimum wages and prevailing wages. Now they’re all paying prevailing wages,” Li says.

And Li says that even when the program runs out of stimulus funds, it will continue requiring that contractors pay prevailing wage rates on the projects.

“Once we’ve gone up, we won’t go back,” Li says.

John Killan, president of the Pacific Northwest chapter of Associated Builders and Contractors, is shocked by the prevailing wage rate requirement. State law only requires prevailing wages be paid on public construction projects with a price tag greater than $50,000 — which is much more than the county-run program is paying for each home.

“That’s a huge expansion of authority, and it greatly reduces the bang for the buck that taxpayers are getting out of the weatherization program,” says Killan, whose open-shop organization represents around 200 businesses in Oregon and Southwest Washington.

Although Portland’s program is just getting under way, the City Council has already committed it to paying potentially higher wages. The council approved a Community Workforce Agreement governing the program that requires paying prevailing wages, or 180 percent of the state minimum wage, whichever is higher. It also says contractors receive points for providing benefits, including sick pay, vacation time, a pension or retirement plan.

The requirements are a good way to create “family wage jobs,” says Jeremy Hays, the local special project director for Green For All, a nonprofit advocacy group that helped negotiate the agreement.

“Right now, especially in the recession, we must put programs in place that give people a toe hold onto a path into the middle class,” Hayes says.

TRIBUNE PHOTO: L.E. BASKOW • Douglas Poole and Jim Guidice inspect the side of a house under a wooden deck during an energy auditing class in Northeast Portland. The Everblue Training Institute conducts a number of courses in energy efficiency principles and practices.

Workers are in training

Potential workers are already lining up for the jobs. Seventeen students spent the last week of January learning how to be certified as energy auditors by the Building Performance Institute, one of several organizations setting standards for workers in the weatherization and energy efficiency fields. They paid nearly $1,600 apiece for classroom courses and a day of in-field instruction at a local home.

One of the students was David Leatherwood, a Portland telecommunications contractor. After looking into the energy efficiency field, Leatherwood decided it is the wave of the future.

“Telecom has gone bust in the past, but energy will be around a long time,” says Leatherwood, who allowed the class to study his Northeast Portland house.

The course was offered by the Everblue Training Institute of Charlotte, N.C. Spokeswoman Bana Kopty reports that interest is up across the country.

“Our phones have been ringing off the hook lately,” Kopty says

A growing number of people also are signing up for courses that allow them to be certified by the Residential Energy Analyst Program. The classes are administered in Oregon by the Oregon Energy Coordinators Association, which was formed 30 years ago to guarantee the quality of weatherization programs. According to program director Jim Dawson, registrations for some week-long courses are expected to double this year. They cost $2,600 each.

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