In June, Minnesota's Department of Commerce directed the Builder’s Association of Minnesota (BAM) to use stimulus money from the Department of Energy to help weatherize houses and create jobs. BAM created Project ReEnergize and by Sept. 15, had registered and trained 855 contractors who would help homeowners claim the money for their energy-efficient projects. By the end of October, the program had applied its entire budget of $2.9 million.

The program is administered by BAM on behalf of the state Department of Commerce. It offers rebates to homeowners of pre-2000 homes to replace windows and upgrade insulation. Homeowners receive $250 per opening, $300 per opening with attic air sealing, $800 for advanced air sealing, $800 for attic insulation, and $800 for exterior-wall insulation. Program requirements include:

  • The house must be: owner-occupied; constructed prior to the year 2000; and 3,000 square feet or less.

  • The homeowner must work with a qualified contractor.

  • Projects must be completed before the rebate application is submitted.

“We wanted to get real consumers considering real remodeling projects in this economy. Who are they right now? The only people who know them are remodelers," says Pam Perri Weaver, BAM’s executive vice president. "We wanted to reach the consumer on the fence now to do that bath or kitchen remodel. It is about jobs as much as it is about energy.”

She says that BAM reached out to the state’s 13,000 licensed contractors with information about the training for the program. “But we only had enough to train 850,” she says. The 855 contractors who completed the training are listed on the Project ReEnergize website. To receive a rebate, homeowners choose a general contractor, who will then work with a trained sealer/insulator. The group teamed up with Minnesota’s Center for Energy and Environment to develop a six-hour class for air sealers/insulators.

Credibility and Leads

Mark Sass of Sass Construction, in Chanhassen, says that as a qualified contractor, his contact information is on the Project ReEnergize website. He has received phone calls from homeowners interested in the program. “People are out there hunting for programs,” he says. Out of the five leads from the site, he has three projects that may qualify. Most involve replacing windows, with some additional work. Since each contractor initially only receives two project applications, he will have to decide which ones will have the most advantage and see which homeowners make a commitment.

Greg Kraus, designer with Otogawa-Anschel Design-Build, in Minneapolis, says that the company focused on existing projects that were moving into the contract phase. “We use a design/build process, so it takes much longer, with more things to figure out. We’re trying to make do and take advantage of it,” he says. The company completed one project through the program and is waiting for the approval of a homeowner on another project — both are for window replacements and insulation upgrades, each costing about $7,000. Kraus says that the program is a good effort, but if a business is struggling, two window replacement jobs or insulation upgrades will not save it. However, he adds, it does help window manufacturers and will educate homeowners on how improvements like this can help them to save money on their utility bills.

Sass is looking at the marketing advantage and added credibility that the program provides for his company. “Even if the [homeowner] doesn’t choose to do the program, I [now] have another contact,” he says.

Not a Fit for All

Tim Lemke, of Tim Lemke Construction, in Mendota Heights, had a few jobs to which he thought he could apply the rebate. One was more than 3,000 square feet, so it was too big. For another project, Lemke explained about the program to the homeowner, but he didn’t want to participate. “His attic has air leaks and very little insulation. It would have fit him to a T,” Lemke says.

For Lemke, the leads that he has received from the Project ReEnergize site are not his type of client. “Many are looking for the lowest price," he says. "We are looking for good products that will service a house for 20 years.” Kraus says that Project ReEnergize requires installation of Energy Star windows — the federal tax credits have a stricter requirement (for federal requirements, click here). “Most contractors are trying to get homeowners qualified for both,” he says.

Taken by Surprise

It appears that most contractors are aware that the funds have been depleted. “If we would have known how quickly the money would run out, we would have approached it from a different angle,” Kraus says. Qualified contractors received two packets, with the idea that once they completed those packets, they would receive more. “We aren’t expecting any additional packets,” Kraus says.

Weaver says that they did not expect the money to be used so quickly. Half of the ARRA funds were given to the state’s housing authority for energy-efficient upgrades for low-income owners. BAM will not know if it has access to additional funds for Project ReEnergize until the housing authority completes its program. --Nina Patel, senior editor, REMODELING.

Additional Information

For an overview of how the federal government is distributing ARRA funds, read the "Follow the Money" article in REMODELING, which provides information about funds available for green construction.

More money may be coming your way. The federal government is still distributing ARRA money to states for programs such as Minnesota’s Project ReEnergize. In addition, the government recently unveiled a new multi-agency report that aims to boost energy saving by making the country’s existing homes more energy-efficient. Click here to read a story about the report.

Does your state have a program for energy-efficient remodeling using the ARRA funds? If so, e-mail Nina Patel, npatel@hanleywood.com.