Too Legit To Quit
In a way, Hansons Windows & Siding is somewhat of an exception. It’s easier for companies such as A.B.E. Doors & Windows, which install using their own employees, to make sure that all those employees take the EPA training and become certified than it is for a larger company to ensure that all the subs it uses are certified for lead-safe renovation.
But, as Zilka points out, it’s the contractor who signs the contract, not whoever he hires to do the work, whether that person is on his payroll or not. If lead-safe work practices aren’t followed on a job where lead-based paint is present, it’s the contractor who assumes liability, whether for EPA fines or a civil suit launched by an angry homeowner with a sick child.
Already, safe lead-paint removal is being worked into the sales presentation of home improvement companies, as well as into their pricing. Originally, company owners were convinced they would need to send their salesforces as well as all their installers for CR training. Now most are simply incorporating safe lead-removal language into the sales presentation and contract language and sending their installation managers for the training.
Window replacement companies, for instance, anticipate including contract language that specifies a dollar amount ? $50 per opening is the figure being kicked around at the moment ? in the event that safe lead removal becomes part of the job. Elias estimates that, given a choice, nine out of every 10 prospects who live in a house without children will opt out ? if the opt-out provision remains in effect. Berenson doubts it will.
Cost Containment
So what will compliance actually cost, on a per-job basis? That depends on the scope of work and the efficiency of the people who are doing it. When the EPA initially put the rules together ? with input from National Association of Home Builders’ contractors ? it estimated the cost of compliance at $35 per job. Contractors, on the other hand, estimate that compliance will cost at least several hundred dollars per job, or as much as 10% or more of the cost of some small jobs, such as replacing an entry door or a few windows. Cost is proportionate to the size of the job and the amount of demolition involved. “It’s significant enough,” Dillon says, “but it’s not going to destroy us.
Here’s what the cost includes:
1) Installer training and certification. For your company to be certified, you must have a certified installer on staff. Training runs from $250 to $350 for an eight-hour course resulting in certification.
2) Time spent containing the work area in a home where lead is present or suspected. In a window replacement job, for instance, that would involve the time it takes to lay or tape plastic sheeting in front of and around openings and to cover (or move) homeowners’ belongings. Zilka estimates it at about 20 minutes per window.
3) The cost of materials involved in containment and clean-up. That would include plastic sheeting, tape, a HEPA-vac cleaner ($600), and clean-up materials.
4) The legal and administrative cost of incorporating lead-safe practice language into your contract and developing the paperwork you need to demonstrate that your company fulfilled its obligations under the law.
The Great Divide
Since the EPA has little or no enforcement mechanism ? audits, fines, and civil suits will be the means to crack down on those who violate EPA rules ? much of that will pass unnoticed. “I don’t think you’ll be seeing much enforcement for at least a year or two,” Berenson says. Enforcement will depend on whether or not “the press makes an issue of it or if groups start suing over it.”
The threat of civil suits is a potent one. Already paint manufacturers and inner-city landlords, have been sued. “We are going to use it as a mark of professionalism,” Dillon says. “We’ll tell homeowners: If you want to deal with contractors who are licensed and insured, this is now the law.”
?Jim Cory, editor, REPLACEMENT CONTRACTOR.
Are You Insured?
However unlikely a proposition, imagine your company suddenly served with a civil suit under the Consumer Protection Act for violating EPA safe lead-paint removal regulations. The suit alleges unsafe work practices by those in your employ, which left a child with cognitive and behavioral damage. The client seeks damages totaling $1 million. Though no such suits filed against contractors have reached a jury, as of this writing, it is inevitable that, like the suits filed against paint manufacturers and landlords, they will.
In November, a Baltimore jury awarded brother and sister plaintiffs $2.5 million in a suit against City Homes, an area nonprofit. The plaintiffs, now 17 and 20, alleged that in the 1990s City Homes had rented their family a house known to be unsafe because of lead-based paint, and that in the four years they had lived there they had been poisoned by it.
Similar suits have been filed against contractors who renovate in homes with lead-based paint, though many more likely will be as awareness of lead and contractor lead safe removal responsibility becomes more widespread. That’s why a slew of insurance companies have introduced new products in the form of pollution insurance coverage for contractors.
According to Pennsylvania insurance broker Mark Kinsey, who counts many contractors among his customers, contractor liability insurance typically excludes such coverages. Contractors seeking insurance protection would need to purchase a separate pollution insurance policy, which would cover them in the event of suits having to do with mold, asbestos, or lead paint in the work area. Kinsey cites a figure of $2,500 as an average annual cost of the premium.
Matt Wallace, vice president of BC Environmental Insurance Brokers, in El Dorado Hills, Calif., says a policy that his company is currently formulating would start at premiums of $1,800 per year. Costs are based on the number of people who work for the company, and the types of sites they are working in.
“If contractors are working in older homes in some regions, they’re going to have to realize that this is as important as general and property insurance, auto insurance or workers’ comp,” Wallace says.
The Paper Trail
Just as important as containing lead-paint dust disturbed in the course of a remodel or home improvement project and cleaning up to ensure that no toxic dust remains, is leaving a paper trail that proves your company took all precautions and required measures when working on a job in a house built before 1978, when lead-based paint was banned by order of the government.
Documents you would need to have in a job file to prove your company obeyed the law include:
1) The results of whatever testing for lead you did in the house.
2) A document signed by the home-owner indicating that you or your representative informed him or her of the dangers associated with lead-based paint being disturbed, including hand-off of the EPA pamphlet “Renovate Right.”
3) If the owner elects to opt out of safe lead-removal procedures for the sake of cost or convenience, you’ll also need a form stating so and also bearing the homeowner’s signature.
4) Names of your Certified Renovator and all technicians working on the project.
5) A checklist indicating that the jobsite was posted as unsafe, was properly contained, and was cleaned by both wet- and dry-mopping, and that lead-safe work practices were used.
6) Test results of a clearance exam indicating that no lead dust remained in the work area after completion.
The EPA suggests that contractors maintain these documents for three years after the completion of work. D.S. Berenson, an attorney with Johanson Berenson, a Virginia law firm that represents many home improvement companies, suggests maintaining those records for a minimum of six years. Also suggested: Make a list of those in your company who are trained for lead-safe removal, whether CRs or not, and keep that laminated list in all company trucks.
