A New Tool for Greening Buildings and Neighborhoods: The “Smart Growth Tax Credit”

Dale S. Bryk, Natural Resources Defense Council
Jennifer Henry, U.S. Green Building Council

Keywords

Abstract

According to the U.S. Census Bureau, there will be over two million housing starts nationwide in 2004. This presents an enormous opportunity to affect energy use in both the construction and transportation sectors. Natural Resources Defense Council (NRDC) recently developed state legislation in New Jersey that would establish a “Smart Growth Tax Credit” to provide incentives for developers to design and construct environmentally superior buildings using more sustainable land use patterns. The legislation, now pending in the New Jersey legislature, includes specific criteria regarding location, neighborhood design, and green building practices. The Smart Growth Tax Credit addresses two energy issues that are usually dealt with independently. First, it aims to reduce the energy consumption of individual buildings by including efficiency standards in its green building criteria. Second, it endeavors to reduce vehicle miles traveled (VMT) by incorporating the conclusions of location efficiency research into its location and neighborhood design criteria.

Because the Smart Growth Tax Credit includes both “smart growth” and “green building” aspects, the process of developing criteria involved unifying the supporters of these two goals, who tend to operate separately. The bill provided an excellent opportunity to explore ways to promote both objectives simultaneously, and in the end NRDC was able to establish consensus concerning the respective weighting of “smart” and “green” features. This paper will introduce the Smart Growth Tax Credit as a new policy tool, describe the location efficiency research that was used in its development, and discuss the overlap between the spheres of smart growth and green building.