Going Green: Intelligent Investments for Public Housing

1. District of Columbia Housing Authority Office of Capital Programs and Development Construction Services Administration, LLC Going Green: Intelligent Investments for Public Housing How to Conduct an Energy Performance Contract July 14, 2011 Adrianne Todman, Executive Director Christopher A. Stennett, Interim Director, OCPD Presented by: Michael W. Brown & Denise Everson, OCPD

2. Discussion Topics • Program Background • Program Analysis • Economic Analysis • Summary and Questions

3. Energy Capital Improvement Program (ECIP) • ECIP is a capital projects program designed to financially leverage the energy and water savings associated with the replacement of aging equipment and infrastructure. • Using established HUD subsidy incentives, DCHA funded the program from energy and water savings.

4. Program Goals • Provide safe, comfortable, and affordable housing that improves the quality of life for the Residents; • Upgrade and Modernize Housing equipment and infrastructure; • Reduce DCHA energy consumption; • Reduce DCHA operations, emergency repair and maintenance costs; and to • Increase DCHA staff capabilities and system monitoring.

5. DCHA’s ECIP Concept to Monitoring DCHA: Board Approval OCPD: Project Planning DCHA: Board Resolution DCHA: Submit HUD Application HUD Approval OCPD: Utility Baseline DCHA: Financial Closing** DCHA: Select Bond/Lease/Loan Financing method OCPD: Energy / Facility Audit OCPD/CSA: Construction Begins DCHA: RFP for financing arrangements OCPD: Projects Selected DCHA: Loan repayment begins DCHA: Complete Financing Package OCPD: Draft Program Documents* OCPD/CSA: Commissioning & M&V Monitoring Begins * Program documents include: Project Management Plan; Construction Management Plan; Commissioning Plan; M&V Reporting Plan ** Upon financing can repay DCHA for all study loans, fees, consultants etc.

6. FY’00: established the DCHA Energy & Environmental Master Plan FY’01: established DCHA Utility Billing and Administration Database FY’04: completed the most comprehensive 3-year historical utility consumption baseline by unit/property in HUD history; conducted energy audits for energy conservation measures by property ECIP Program History

7. ECIP Program History • 1QFY’06: submitted application to HUD for approval • 1QFY’07: solicited and chose a lender • 4QFY’07: received HUD approval • 1QFY’08: executed agreement with lender and received funding • 1QFY’11: Over 95% construction completed

8. $21.1 million in critical infrastructure & equipment replacements 31 Properties 5,444 Units  28,000 Residents affected Average $16 million annual utility budget $3.9 million in annual savings ($3.9/$16 = 24% reduction) DCHA ECIP Profile

9. ECIP Scope of Work Energy Conservation Measures (ECM) • Boilers • Chillers • Hot Water Systems • Fan Coils • Water Saving Devices • Lighting Central Energy Management System • Automation/New Technologies • Metering & Communication • Preventive Maintenance • Commissioning

10. ECM Scope of Work

11. Comparing ECIP Finance Options

12. Comparing ECIP Finance Options

13. Tax-Exempt Master Equipment Lease • DCHA acquired all equipment with the funds raised to complete the program • DCHA makes “Rental Payments” pursuant to the terms of the Master Lease Agreement • 12 to 15 month Construction period before Debt Service commenced, with Interest During Construction added to Financed Amount • Debt Service Reserve of 3 to 6 months was added to Amount Financed – repaid at end of Term – this would serve as the “guarantee” • Assets owned by Financier and sold to DCHA for $1.00 at end of Term

14. Self Performance Economic Analysis • Capital Cost - $21.1 million • Industry/ HUD Program Soft Costs (ESCO) - 76% • $21.1 X 76% = $16.0 M + $21.1 M = $37.1 M (Total Cost) • Program Costs - 22% • $21.1 X 22% = $4.6 M + $21.1 M = $25.7 M (Total Cost) • Project Savings - $11.4 million • O&M avoided costs - $2.4 million

15. Proposed Energy & Water Consumption Savings

16. Proposed Energy & Water Consumption Savings

17. Proposed Energy & Water Consumption Savings

18. Proposed Energy & Water Consumption Savings

19. Proposed Energy & Water Consumption Savings

20. Proposed Energy & Water Consumption Savings

21. Reported Energy & Water Consumption Savings During Construction

22. Energy Operations & Maintenance Savings • Avoided costs as a direct result of energy capital equipment replacement • Savings estimated from DCHA FY00 and FY01 budget analysis • Savings are not captured under HUD incentives

23. ECIP IN ACTION

24. Demonstrated SavingsGreenleaf Senior / Gardens – Natural Gas • Completed boiler retrofit • 14% reduction

25. Demonstrated SavingsKenilworth Courts - Water • Completed water fixture replacement • More than 51% reduction

26. Demonstrated SavingsKentucky Courts - Electric • Completed chiller retrofit • 27% reduction

27. Summary • Modernized Infrastructure • New Technology • $4 million/year in cost efficiencies • Complete in 36 Months • Commissioning starting in next 60 days • Establish Energy & Environmental Leadership

28. Our Energy Partner since 1996… Contact Information: Paul Orentas ECIP@thinkboxgroup.com Office: 540-338-8572 GSA Schedule GS-21F-0030U

29. Contact Information Keith A. Kindel R. Denise Everson, LEED AP Michael W. Brown kkindel@dchousing.orgreverson@dchousing.orgmbrown@dchousing.org (202) 535-2736 (202) 535-2566 (202) 535-2741 Office of Capital Programs and Development 1133 North Capitol St. NE, Suite 242 Washington, DC 20002 Fax: (202) 535-1102