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Building Codes for Rehabilitation

How can rehab codes facilitate rehabilitation of older homes?

Building codes also offer an important way to support building rehabilitation and preservation. Rehab codes are special building codes designed to make it easier to renovate older homes while ensuring that modern safety concerns are addressed. Traditional building codes often require that older buildings be brought into full compliance with current standards for new construction, even when a project calls for only moderate levels of rehabilitation. The additional renovations necessitated by these requirements, such as the widening of staircases or raising of ceilings, can significantly increase the cost of a proposed project without contributing substantially to greater safety, creating a disincentive to restore or modernize existing structures.

To remedy this problem, a growing number of states and localities have adopted rehab codes that tailor compliance requirements to the type and extent of work planned. Created specifically to address redevelopment in older buildings, rehab codes keep regulation predictable and proportionate to the scope of the project while still ensuring resident safety. The renovation of once attractive but now dilapidated older buildings can be an excellent vehicle for stabilizing neighborhoods, providing housing and sparking downtown revitalization.

Most rehab codes are organized into categories that specify the regulatory requirements triggered by different types of projects. These requirements are tailored to the type of work planned, keeping regulation predictable and proportionate to the scope of the project while still ensuring resident safety. Small projects or work confined to a small area trigger only minimal additional requirements for bringing the structure up to modern codes, while extensive renovation or additions may require more comprehensive upgrading to meet current construction standards.

Rehab codes reduce the financial obstacles to rehabilitation posed by onerous requirements in building codes intended for new construction. Rehab codes also help to alleviate unpredictability in the development process by specifying which requirements are triggered by different types of redevelopment projects.

Without this sensitivity to the differences between new construction and the rehab of existing structures, buildings in need of moderate restoration can fall further into disrepair if owners are unwilling to make improvements and therefore trigger traditional building code requirements. Many foreclosed homes are in need of rehabilitation because home repairs are often the first expense to be cut when homeowners encounter financial difficulties.  In a weak housing market, these buildings can stay vacant for years, reducing the potential tax base, potentially increasing crime, and impeding neighborhood stabilization and community revitalization. In a stronger housing market, buildings that are allowed to completely deteriorate may eventually be torn down and replaced with newer, more expensive homes that are out of reach of working families.

Finally, building codes that make renovation more feasible help to maintain the character of older homes and historic neighborhoods by facilitating the of aging structures.  From an environmental perspective, the rehabilitation of existing buildings is an inherently “green” option since it utilizes existing structures and materials that might otherwise be demolished.

Where are these policies most applicable?

Rehab codes are most applicable in communities with a significant supply of older housing stock, particularly in places with large numbers of vacant, foreclosed or abandoned properties in need of repair. When rehabilitation is too difficult or costly, it can be challenging to bring these structures back into productive use.

Municipalities concerned about stimulating downtown revitalization and reducing the extent of sprawl on the urban fringe also may wish to consider the adoption of rehab codes. Without these more flexible standards, developers may choose to focus on easier-to-build new construction on the edges of the community rather than potentially costly infill redevelopment projects.

What are the benefits of a rehab code?

In communities that use conventional building codes, the level of building upgrades required in a rehabilitation project is typically based on the estimated cost of the project rather than the type or scope of work proposed. The more expensive the project, the greater the degree to which the building must comply with current standards. This approach can trigger requirements for extensive renovation in rehabilitation projects that make only minimal structural changes — a scenario that increases costs and may discourage the redevelopment of affordable homes.

In contrast, rehab codes match the level of required compliance to the type of work proposed. This shift can lead to substantial savings in time and money and may be the key to making a particular rehab project feasible.

A case study comparison prepared by the National Association of Home Builders illustrates the differences between conventional building codes and rehab codes. The 250-year-old Stone Lodge single-family house in Chester Township, N.J., was rehabilitated in the late 1990s to include an updated kitchen and new two-story addition. The cost and extent of the project would have triggered a significant number of additional requirements in order to bring this already functioning structure into compliance with conventional codes, including inspection of the building foundation, widening of existing windows and corridors, raising the ceiling height in a first-floor bathroom and reconfiguring the stairway.

These changes would have added an additional $27,562 to the total project cost, potentially making the project infeasible. Because the project was developed after New Jersey adopted its pioneering rehab code, these changes were not required.

Energy codes for building rehab

Similar to rehab codes that ensure building renovations comply with safety measures, states and localities can enact building energy codes, which establish minimum requirements and guidelines for the performance of new construction and existing homes undergoing substantial renovation. Energy codes typically provide specifications for areas of the home most closely related to energy consumption, including windows and doors, heating and cooling equipment efficiency, lighting fixtures and wall and ceiling insulation.

Model rehab code

In most states, local jurisdictions have the authority to adopt and enforce building codes. Most municipalities have chosen to adopt one of several model codes developed by building and code enforcement industry associations. By adopting a model code, jurisdictions avoid the time and expenses associated with creating and maintaining their own regulatory systems, but they retain the flexibility to add any amendments needed to ensure the code suits local conditions. In addition, model codes promote uniformity and consistency in code requirements and enforcement, allowing builders to more easily anticipate the level of work, timeframe and costs associated with a proposed project before submitting their plans for review.

Two model rehabilitation codes — the International Existing Building Code (IEBC) and the National Fire Protection Association’s NFPA 5000 — helped move regulation of building renovation toward greater predictability and proportionality in rehab code requirements. States and localities can adopt amended IEBC to meet their own set of specifications. The IEBC is not automatically adopted when a jurisdiction adopts the standard building codes of the ICC. Rather, the IEBC must be adopted as a separate standalone action. In 20 states and the District of Columbia, the IEBC has been adopted statewide, and local governments have adopted the IBEC.

Prior to the development of model codes for existing buildings, a number of states and localities developed their own codes to facilitate the rehabilitation of existing buildings. Most notably, the state of New Jersey has been a leader in recognizing the need for a more flexible building code; its statewide rehab code has been a model for the development of similar regulations in other states. New Jersey is one of a handful of states that adopts mandatory building codes at the state level, so all localities are required to implement the state-endorsed code. Reports indicate that adoption of this predictable and proportionate rehab code precipitated an immediate response, prompting significant increases in the level of rehabilitation work, especially in the state’s larger cities. Interestingly, while the number of rehab permits issued increased substantially following adoption of the code, the increase in the value of permits issued was relatively small in comparison — indicating that code implementation had the greatest effect in stimulating smaller projects that might not otherwise have been financially feasible.

Creating and maintaining a regulatory code is a costly and time-consuming job. In most cases, communities will be well-served by adopting an existing model code and making amendments as needed.

Train officials to be familiar with new rehabilitation codes

Code enforcement is a highly technical job that requires building inspectors to be well trained and familiar with the regulatory requirements in place. To successfully transition to a new rehab code, building departments need to ensure that staff is properly educated about code specifications and standards.

In areas where local adoption of a state-endorsed code is optional, a special outreach effort may be needed to encourage municipalities to take up the new system. As part of the 2009 North Carolina Rehabilitation Code, for example, the state unveiled a complementary website that contains materials to support outreach efforts about how the code can work in communities throughout the state.  Some free online tools available include a PowerPoint presentation, case studies and listings of training opportunities for building professionals to learn more about the code. Technical assistance to communities can also help ease the process of converting to a new rehab code, building familiarity and confidence in code interpretation.

Obstacles to rehabilitation posed by traditional building codes

Traditional building codes present significant obstacles to rehabilitation of existing buildings largely through enforcement of two principles: the 25/50 percent rule and the change-of-occupancy requirement.

The 25/50 percent rule refers to rehab project cost thresholds that are used in traditional building codes to determine the extent of required code compliance. In general, the rule establishes the following:

  • If the proposed rehab work costs 50 percent or more of the building’s value or replacement cost, developers have to bring the entire building up to current code standards for new construction
  • If project costs fall between 25 and 50 percent of the building’s value or replacement cost, only the parts of the building undergoing renovation have to be brought to code
  • For proposed rehab projects that cost less than 25 percent of the building’s value or replacement cost, local officials and contractors can negotiate standards for compliance

Using this system, even a moderate rehab project could trigger the need to undertake substantial renovation in a modest home with a relatively low cost of replacement. The required scope of changes may not be proportionate to the planned project.

In addition, methods of calculating the cost of replacement vary by community, making it difficult for developers or building owners to accurately estimate costs. Finally, when the level of compliance required is left to a code official’s discretion (for projects costing less than 25 percent of the building’s value or replacement cost), the ability of the building owner or developer to predict total project costs can be compromised.

Although these provisions were taken out of the model building codes decades ago, studies show that many communities continue to rely on the 25/50 percent rule as an informal benchmarking tool or as part of the current regulatory system.

The change-of-occupancy requirement stipulates that any time a building undergoes a change in use, the entire structure must be brought into compliance with current requirements for the new use. For example, if a proposed project converts an old school into apartments, the structure must comply with all requirements for new residential construction. The change of occupancy requirement may present an obstacle to the adaptive reuse of older commercial or industrial buildings for affordable housing, with the costs of compliance too high to make rehabilitation feasible.

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