Is this the first of a wave of remodelers choosing not to work on older homes?
The new rules about lead paint have pushed remodeling company owner Tim Shellnutt of Elk Remodeling, in Fairfax, Va., to include an important notice to customers in his March newsletter. The newsletter heading reads, “Elk Remodeling Will Discontinue Services for Homes Built Before 1979.” While Shellnutt’s response might not work for many business owners, there are many others in the industry who see the new Environmental Protection Agency (EPA) lead paint law, which takes effect April 22 - and includes a $37,500-per-day penalty for noncompliance - as a game-stopper. “It’s not worth the risk to work on these houses when there are other ones we can do,” Shellnutt says.
Although the compliance deadline is next month, Shellnutt, like a lot of remodelers, still has many unanswered questions and has gotten inaccurate and incorrect information regarding issues such as insurance and costs. Shellnutt believes the new rules will cause him to have to raise prices so high that clients won’t be willing to pay, and that his profits will be lower because it will take that much longer to complete each job.
The Real Cost?
While those in the remodeling industry generally consider the EPA’s estimate of an additional $35 per job to comply with the new lead paint laws as too low, the costs may not be as detrimental as Shellnutt believes. Paul Toub, vice president of marketing at Kachina Lead Paint Solutions, reminds remodelers to think of the costs of complying as something amortized over the life of the business: There’s the $300 for the business’s required lead paint renovator certification, which is good for five years. Then, at least one person in a company must obtain a renovator certification, which costs an average $200 and is good for five years. (Or a compliant subcontractor can be used.) Add in job materials such as a HEPA vac (between $500 and $600), lead-check kits, plastic sheeting, caution tape, and signs. “Per job, you’re not talking about thousands of dollars,” Toub says.
Of concern, too, is the amount of additional time it will take for some projects. For example, a window job with just three or four openings will still require a whole lead-safe setup, resulting in extra installation costs per window. Industry rumors have floated figures of double the usual cost, but in reality, employing lead-safe practices might add 20 to 30 minutes to each job, amounting to between $25 to $50 per window.
Shellnutt also worries about insurance, which has been a gray area, as many insurers are not offering a lead paint rider. Also, keeping a well-documented paper trail is going to be important, so administrative costs may increase.
Taking a Stance
“[Lead-safe practices are] certainly not anything that isn’t at least worthwhile trying, and based on the number of jobs you do, you [might] conclude in six months … that it’s … a pain but manageable. And practice makes perfect,” Toub says.
Despite what Shellnutt calculates to be a possible 15% loss in business - after the newsletter went out he immediately received calls from upset clients, some looking to have their work finished before the deadline and others angry that he won’t work on their projects - he is going through with his plan. He says that he has not made this decision lightly and has done market research, determining that many of his current jobs have been in newer neighborhoods in northern Virginia. “What I lose from [areas with older homes], I’ll [use to] target more aggressively in areas that are younger,” Shellnutt says. “You can control your own marketing and decide who your clients will be.”