Contractors, Homeowners, Worry Remodeling Regulation May Backfire

Home remodeling contractors’ survey finds recent federal regulation is causing “a significant increase in the cost” of remodeling projects nationwide. Conducted by the National Association of the Remodeling Industry the survey indicates EPA’s one-year-old Lead Renovation, Repair and Painting rule is irrelevant to homeowners who do not have small children living in their home and expensive to those who have or expect children.

Furthermore, the regulation “is certain to negatively impact scores of small remodeling businesses” currently struggling to survive and in a wider scale further slow down the housing market recovery, NARI said, because the EPA is expected to add more layers to the existing regulation.

Revisions include the addition of “lead clearance testing” to renovations in homes built prior to 1978, which translates into higher renovation costs for a single project for homeowners.

NARI said homeowners have expressed their resentment of the extra costs they incur because of the new regulations often by choosing to do the demolition or project work themselves to save on costs, ultimately risking lead exposure because they are not trained in lead-safe work practices.

The regulation’s loophole, according to president of Merrick Design and Build Inc. in Kensington, MD, David Merrick, is that “lead clearance testing only applies to contractors, not to homeowners.” Which is why the impact of the new regulation will be much higher on small contracting business owners with already tight budgets who must comply with EPA requirements. 

The survey raises concerns for the future of the remodeling industry suggesting the aforementioned LRRP rule will trigger “new exposure” to bankruptcy risk.

The Des Plaines, Ill. based trade association said its over 63,000 members voluntarily subscribe to a strict code of ethics that included the protection of children and pregnant women from the dangers of lead poisoning “long before regulation was enacted.”  However, NARI members represent less than 10% of the nation’s approximately 800,000 companies and individuals in the U.S. that according to NARI identify themselves as professional remodelers.

As it currently stands, NARI said citing input received from surveyed contractors and homeowners the additional cost of EPA’s LRRP rule “deters homeowners’ use of lead-safe certified contractors” leading to a trend that “could cause more harm to vulnerable populations of children and pregnant women.”
The cost of hiring lead-certified contractors is too high for most homeowners pushing them to hire unqualified contractors, take charge of parts or all of the project themselves, or reject renovations altogether.

The most recent government census reports there are over 652,000 remodeling businesses in the United States, of which 552,191, or almost 85% are not certified with the EPA.

The 99,809 firms that are listed as certified renovator firms with EPA also have to be re-trained so they comply with the new business practice requirements. 

NARI is calling for a review of the current regulation to ensure it establishes “reasonable solutions” that can benefit America’s aging housing and its need of renovation and repair work.

The combined effect of unemployment, tight credit, costlier home remodeling, and larger remodeling industry liabilities create an incentive for “hazardous renovation work undertaken by under-skilled workers or homeowners,” Merrick says, and may “severely impede” the modest growth predicted in years ahead for the remodeling sector which predominantly consists of small businesses.