The Washington DC City Council passed legislation called The Green Building Act in 2006. The act, which is set to begin in 2012, will require a green performance bond to on all future eco-friendly construction projects.
Performance bonds provide a safety measurement for those participating in a construction project. They ensure faithful execution of the guidelines outlined in the contract, and guarantee those involved will receive payment. As homeowners learn the multitude of benefits eco-friendly construction provides, the demand for more buildings is growing. It’s an emerging, lucrative industry that many contractors are interested in tapping into. In order to fulfill the legal requirements for taking on such projects, contractors need to secure a green performance bond before they can begin construction. The trouble is – these bonds don’t exist.
The stipulations of what these bonds will protect are still being created. While waiting for more definitive guidelines to be clarified, many are left guessing what these performance bonds will require. Some feel it will specify that the buildings adhere to green regulations; should they fall short, the surety company providing the bond would be financially accountable for resolving the issues.
With the 2012 deadline rapidly approaching, many are left to predict the conditions of these construction bonds and how much they will cost contractors to acquire. Surety companies are also uneasy about their vagueness as they don’t know the level of liability they are at risk to provide.
Still, there is reason to be hopeful. If the DC City Council does figure out a way to make these regulations work, it will spark the execution of eco-friendly construction throughout the nation, and begin the building of a cleaner, greener country.