Are You Meeting Thermal Insulation Code Requirements?

Photo 1. Conditions such as this, in which the fastener plates melt the snow, visually demonstrate the heat loss that is a known entity to roof installers and knowledgeable roofing professionals.

You may have overheard conversations such as this:

New Building Owner: “You promised energy conservation and savings.”

Mechanical Engineer: “We sized the mechanical unit based on the code required effective thermal value.”

New Building Owner: “But why are my cost 30 percent above your estimates and I am needing to run my units constantly and they still barely maintain a comfortable environment?”

Mechanical Engineer: “We have checked all the set points and systems and they are all working, albeit with a bit of laboring. We don’t know why there is not enough heat.”

New Building Owner: “Well, someone is going to have to pay for this!”

Scenarios and liability questions like this are being repeated across the northern North American continent, and to mechanical engineers, architects and owners, the cause is a mystery. Perhaps they should have talked to seasoned roofing professionals and consultants. They could’ve told them that many mechanically attached roofs, incorrectly promoted and sold as energy-saving systems, were actually energy pigs. One only needed to walk a mechanically attached roof with a few inches of snow on it to see the heat loss occurring. It doesn’t take scientific studies and long-winded scenarios to prove this — just get up on the roof and see it. (See Photo 1.)

Photo 2. When a light dusting of snow blew off this 2 million-square-foot facility in central Illinois, every single mechanical fastener and insulation joint could be identified by the ice visible at their locations. This roof needed to be replaced due to condensation issues several years after installation at a cost of more than $10 million.

I spoke on this topic back in 2007 at the RCI Cool Roofing Symposium. I always like being a soothsayer, and several recent studies are demonstrating and attempting to quantify this energy loss that most roofers could tell you was there.

For years the NRCA suggested a loss of thermal value of 7 percent to 15 percent through the joints in a single-layer insulation application and through mechanical fasteners used to secure the insulation. (The NRCA has since removed this figure and suggests that professionals be consulted to determine thermal heat loss.) The NRCA recommended a cover board to reduce this effect. This was at a time when roof covers were predominantly BUR, modified bitumen or adhered single plies. The upsurge in mechanically attached single-ply membranes, brought on by low-cost installation and the promise of energy savings, changed the game. No one was asking, if there could be a loss of 7-15 percent when mechanically attaching insulation, what could the effective R-value loss be when we install thousands of fasteners and plates 12 inches on center (or less) down a membrane lap seam? Gee, haven’t we seen that before?

Code Requirements

The code and standard bodies — ICC, IECC, ASHRAE — have been repeatedly raising required thermal insulation values over the past decade in an attempt to conserve energy; that is their intent. They listened to astute designers and

Photo 3.This is close-up of the roof shown in Photo 2. Heat loss through the screws and fastener plates and through joints in the single layer of insulation melted the snow. The water froze when the temperatures dropped and the ice was revealed when a light wind pillowed the membrane and the remaining snow blew away.

prescribed two layers of insulation, and then again to determine the minimum R-value and not allow averages. The intent is clear. The required R-value per ASHRAE zone is to be achieved.

Their goals were laudable, but not all roof systems achieved the in-place R-values required. So, this article is in part an attempt to educate code officials and explain the need for a change.

Words can explain the phenomenon of thermal loss, but photos are worth a thousand words, and since my editor has told me that I cannot have a 4,000-word article, I leave it to the photos to do the talking. (See Photos 2, 3 and 4.)

Scientific Studies

In their Buildings 2016 article titled “Three-Dimensional Heat Transfer Analysis of Metal Fasteners in Roofing Systems,” Singh, Gulati, Srinivasan and Bhandari (Singh) studied the effect of heat transfer through thermal bridging (mechanical fasteners) in various roof assembly scenarios.

Their study exposes a shortfall in many standards that have as their goal a reduction in energy loss through building envelope systems through prescriptive approaches. For roofing assemblies, standards prescribe a minimum R-value, but they do not take into consideration the heat loss that happens though metal fasteners. There are no guidelines or recommendations in regards to thermal loss, including the loss of heat through roof system fasteners. It’s actually ignored.

Figure A: The effect of mechanical fasteners below the roof cover in mechanically attached roofs is not negligible as considered by general standards. As can be seen here for systems 1A and 1 B, in which mechanical fasteners are used in the lap seams of the roof cover (systems 3A and 3B have the fasteners below a layer of insulation), the actual thermal value loss caused by mechanical fasteners can be as high as 48 percent, as seen in system 1A with a high density of mechanical fasteners. As the mechanical fastener density decreases (1B), the heat loss also decreases. Thus, a correlation appears to exist in which heat loss due to thermal bridging is proportional to the fastener density.

The results of the Singh study, as seen in the graph (Figure A), show that the effects of thermal shorts, e.g., mechanical fasteners used to secure the roof cover, is not negligible. In fact, thermal shorts can result in a loss of 48 percent of the effective value. Read that again! The thermal value of the roof insulation layer on which the mechanical engineer has in part sized the mechanical equipment — and which the owner is counting on for significant energy savings — could be about half of what was assumed. Add in gaps and voids, and the loss in the effective R-value could top 50 percent. What that means is that to achieve the code required R-30, say in Chicago, mechanically fastened roof systems need to have R-45 in the design to meet the effective code required R-value. This last sentence is for the code bodies — are you listening?

The value of this study cannot be underestimated, as thousands of buildings have been constructed since its publication that would not meet an effective R-value check in a commissioning study.

Changing the Code

The energy inefficiency of mechanically attached roof systems in ASHRAE zones 4 and above has been known to roofing crews for decades. Now, with the requisite scientific studies completed, the codes need to be revised to reflect the inherent thermal loss through mechanical fasteners. Additionally, studies from Oak Ridge National Laboratory highlight the energy increase required with inherent air changes below the membrane, confirming the need for air/vapor barriers on the deck on mechanically attached roof assemblies. (See “The Energy Penalty Associated with the Use of Mechanically Attached Roofing Systems,” by Pallin, Kehrer and Desjarlais.)

Photo 4: Heat loss also occurs through adhered roofs when the insulation is mechanically attached.

As a starting point for code groups and officials, I suggest the following code revisions:

  1. State that if a mechanically attached roof cover is being used that the prescribed thermal R-value shall be increased by 50 percent.
  2. State that if a mechanically attached roof cover is being used that an air barrier below the insulation must be used and that it shall be fully adhered to penetrations and roof perimeters.

Closing Thoughts

The goal of energy conservation is a laudable one. The American Institute of Architects’ goal of zero-energy building by 2030 will never be met until real-world empirical information can be presented at code hearings. (For those of you who do not attend code hearings or know the process, information is usually disseminated in two-minute sound bites without documentation.) This lack of information sharing is a travesty and has resulted in numerous code changes that have been detrimental to the goal of energy savings. Time has come for a new way of thinking.

Tax Cuts and Jobs Act a Big Victory for Roofing

Recent legislation is expected to provide a boost to the commercial roofing industry. A commercial roofing application of Lapolla FOAM-LOK spray foam roofing is shown here. Photo: Icynene-Lapolla

2017 proved a significant year for the roofing industry. Not only was optimism high and demand still on the uptick in both the new construction and re-roofing marketplaces, but when The Tax Cuts and Jobs Act of 2017 passed in December last year, it marked a huge victory for those involved in roofing. The tax reform essentially opened the door for a series of tax related benefits likely to boost business in 2018 and beyond.

There are a few key areas of the tax reform applicable to roofing entities. One of the key sections — IRC Sec. 179 expensing provision (deduction) — intends primarily to benefit small businesses who can purchase equipment, then write-off the amount of those purchases during the same calendar year. For 2018, qualifying property purchases include most business equipment such as computers, certain vehicle types, virtually all construction equipment and machinery.

“For contractors in our sector specifically, this portion of the reform is key, as it allows them to write off the equipment and vehicles they purchase specific to transporting and installing spray foam roofing on the jobsite,” says Kurt Riesenberg, executive director of the Spray Polyurethane Foam Alliance (SPFA). “Some of our members have been quite pleased to learn about these tax changes, and although we worked hard with other groups to make them happen they still seem like one of the best kept secrets. We need to change that so all of our members know about them.”

Perhaps one of the most notable aspects of IRC Sec. 179, however, is that the qualified property listed under it now includes non-residential roofs. Hailed as a huge win, the new limit on the total amount of Sec. 179 property that a business can purchase each year before being totally phased out is $2.5 million (up from the previous $2 million), and the annual limit for the deduction itself has been raised to $1 million (up from $500,000). A property owner is now able to write off up to $1 million the same year that a commercial roof is purchased. Additionally, the $1 million annual deduction and $2.5 million business investment limit are now permanent and indexed for annual inflation starting in 2019.

“The commercial roof inclusion in the tax reform is likely to spur increased sales and installations of new roofs this year, and we want our members making the most of the opportunity,” adds Riesenberg.

There was one tradeoff made in order to make commercial roofs eligible for Sec. 179 — the elimination of the deduction for the interest on loans to finance the purchase. However, it’s still a significant benefit for contractors able to leverage IRC Sec. 179’s equipment purchase write-off.

Bonus Depreciation Deduction

Another key area of note is IRC Sec. 168(k) — the Bonus Depreciation Deduction — which the act raises to 100 percent for qualifying new and used property acquired, and placed in service, after September 27, 2017 and before January 1, 2023. Property with a depreciable tax life of 20 years or less generally qualifies and includes: machinery and equipment, furniture and fixtures, computers and computer software, and vehicles utilized primarily for business (with a dollar cap on cars and trucks with a loaded vehicle weight of 6,000 pounds or less).

More broadly, the tax rate for C corporations, or the corporate tax rate, was cut through the new reforms to 21 percent (from 35 percent). Also of note to many roofing contractors and contractor firms, pass-through entities organized as S corporations, partnerships, LLCs and sole proprietorships now receive a 20 percent deduction on taxable income up to $157,000 or $315,000 if filing jointly that is phased out at $207,500 or $415,000 respectively.

Many contractors are structured as pass-throughs and pay their business taxes on individual returns, so it also helps that the top individual rate has been lowered from 39 to 37 percent.  However, the rules for pass-throughs are complex and consulting with a tax expert is encouraged.

For contractors that are family businesses, the new tax code doubles the estate tax exemption so that estates of up to $11 million ($22 million for couples) are now exempt from taxation. In addition, the Alternative Minimum Tax (AMT) exemption and phase-out amounts for individuals have been sharply increased.

Finally, in a separate bill, Congress renewed the Residential Energy-Efficiency Tax Credit (IRC Sec. 25C), the Energy Efficient New Home Tax Credit (45L), and the Commercial Building Tax Deduction (179D).  While renewed retroactively only for tax year 2017, the door remains open for these incentives (tax extenders) to be renewed for 2018 and beyond.

“These incentives help, but the tax act’s reforms are a big, long-term win for both the spray polyurethane foam sector and the roofing industry at large,” says Riesenberg. “All indications point to this act giving the roofing industry and its many players a boost in business. It’s business and jobs that drive the economy, and when you add in the resulting benefits direct to our members, this news hits the trifecta for an exciting and optimistic 2018 and beyond.”

The Federal Government Is Making Energy-Efficient Roofing Attractive

Small businesses are now able to deduct the full cost of replacing a roof on an existing non-residential building in the year the project was completed instead of depreciating that cost over a 39-year period, as was previously required. Photo: SOPREMA

It is fair to say that Washington, D.C., is far from dull. From the recent Tax Cut and Jobs Act to rolling debates on passing a federal budget, there is a great deal going on at the federal level that impacts the building and roofing industries. In particular, new reforms allow qualifying building owners to expense, or deduct, up to $1 million for the cost of certain building improvements in the year the work is performed, including adding insulation during roof replacement projects to meet or go beyond modern building energy code requirements. The impact can be significant for capital improvement projects. For example, a building owner that expenses the cost of a full roof replacement can reduce the net cost of the entire project by 25 percent to 30 percent.

Commercial Building Roof Replacements

The Tax Cut and Jobs Act, signed into law by President Trump on December 22, 2017, includes a provision that reduces the overall cost associated with re-roofing and significantly improves the cost-effectiveness of commercial roof replacements that comply with building energy codes. The vast majority of state and local governments require minimum insulation levels for both new roofs and roof replacements (but not for roof repairs or recovers). These requirements apply to existing buildings because the most economical time to improve a roof’s thermal performance is when the roof membrane is pulled off and replaced. Also, roof replacements are one of the best opportunities for improving energy efficiency in existing buildings, which account for 40 percent of U.S. energy use.

Starting in 2018, the new federal tax law expands the definition of “qualified real property” under the small business expensing provisions of Internal Revenue Code section 179 to include improvements to existing nonresidential roofs. Section 179 allows businesses to fully expense (deduct) up to $1 million (indexed for inflation after 2018) in one year for qualified business expenses, such as equipment purchases and specific building improvements. With this change, small businesses are now able to deduct — in the year completed — the full cost of replacing a roof on an existing non-residential building instead of depreciating that cost over a 39-year period, as was required under prior law. As a mechanism intended to limit the deduction to small businesses, the benefit is phased out for businesses that spend more than $2.5 million (also indexed for inflation) on qualified equipment and real property. This change takes effect in 2018 and, unlike some provisions of the new law, is permanent.

A typical scenario under which a commercial building roof replacement is required to comply with a building energy code is one where an older building with a low-slope roof has R-11 or R-12 insulation in the roof prior to the roof replacement. The R-12 assumption is based on a U.S. Department of Energy (DOE) study that evaluated the level of existing insulation in commercial building roofs. For most of the country, current building energy codes require roof replacements to have a minimum level of R-25 or R-30, depending on the climate zone.

The average simple payback period for meeting the energy code is 11.6 years, according to a comprehensive energy modeling study completed in 2009 (“Energy and Environmental Impact Reduction Opportunities for Existing Buildings with Low-Slope Roofs,” produced by Covestro).

The payback period is the amount of time it takes for the energy savings to equal the cost of installing the additional insulation. By allowing a building owner to deduct the full cost of the roof replacement, including the cost for installing additional insulation, the net cost of the entire project is reduced by 25 percent to 30 percent, depending on a tax payer’s tax rate. (The Tax Cuts & Jobs Act reduced the corporate tax rate to 21 percent, but the pass-through rates, which are more relevant to small businesses, are closer to 30 percent, which increases the impact of this new deduction.) More importantly, the deduction shortens the average payback period on the cost of installing additional insulation to 8.1 years, making the investment in energy efficiency even more cost effective for the building owner.

Disaster Relief Reforms and Resilient Buildings

Recent maneuvers by Congressional budget writers provided several positive reforms that will impact the resiliency of buildings in some of the most vulnerable parts of the country.

First, Congress passed improvements to the Federal Cost Share Reform Incentive that increases post-disaster federal cost-share with states from 75 percent to as high as 85 percent on a sliding scale based on whether a state has taken proactive steps to improve disaster preparedness. These steps can include the adoption and enforcement of the most recent building codes. This further incentivizes states to maintain robust and current building codes, including the energy code.

Second, under reforms to the Stafford Act, federal disaster relief funds administered by the Federal Emergency Management Agency may be used to replace or restore the function of a facility to industry standards without regard to pre-disaster condition and replace or restore components of the facility not damaged by the disaster where replacement or restoration is required to fully restore the function of a facility. This allows post-disaster funds to be more effectively used to improve the resiliency of damaged buildings and should create opportunities for higher performing roof systems to replace those damaged in disasters.

While the built environment is likely to benefit under recent Congressional action, other policy priorities for the construction and energy efficient industries have been left unresolved. For example, Congress “extended” several clean energy and energy-efficiency related tax provisions, including the Section 179D deduction for commercial building energy efficiency. However, in head-scratching fashion, this and other tax provisions were only extended through December 31, 2017. This means more work is ahead to preserve the policies for the long term and add much needed certainty to the marketplace.

Unpredictable is a polite (and likely understated) description of the policy environment in our nation’s capital. You need not look beyond the recent FY2018 budget deal for an example. Building energy efficiency advocates spent countless hours educating lawmakers on the importance of funding federal research led by the Department of Energy (DOE). Fearing a federal budget that would cripple these vital programs by slashing budgets, advocates saw an 11 percent increase to the DOE’s Office Energy Efficiency and Renewable Energy budget, which leads research on building energy performance. And while history is a poor predictor of future success, recent action impacting buildings demonstrates that policymakers understand the need for strong policies that encourage and lead to more efficient and resilient construction.

You Might Have More Employees Than You Think You Do

If you are a contractor in the construction industry, there is a chance that a person who isn’t on your payroll is legally considered to be your employee.

If you meet the above description and you operate in North Carolina, South Carolina, Virginia, West Virginia, or Maryland, there is a particularly good chance that’s the case.

You might be thinking this is because of employee misclassification — which occurs when laborers are wrongly classified as independent contractors instead of employees. But that isn’t the whole story. Increasingly, unanticipated employer liability occurs not because of employee misclassification, but instead due to joint employment — a related but totally distinct issue.

This is happening because the definition of what constitutes employment, and joint employment particularly, has become increasingly broad in recent years. Many courts expanded the definition in response to stricter guidelines the Department of Labor’s Wage and Hour Division set forth during the Obama presidency. But this is perhaps most apparent in the Southeast, where, in January 2017, the Fourth Circuit Court of Appeals expanded the definition of joint employment in Salinas v. J.I. General Contractors, Inc. The Salinas decision, along with Hall v. DirecTV, a case involving employee misclassification decided the same day, predate the Department of Labor’s June 2017 rollback of the Obama administration’s restrictive guidelines. However, despite any efforts by the Trump administration to curtail the expanding joint employment doctrine, the Salinas and Hall decisions still control in the Fourth Circuit — and case law in other jurisdiction still controls as well. It’s unclear whether a change in the law is in store anytime soon; however, in January, the United States Supreme Court declined to hear DirecTV’s appeal in the Hall case.

The Salinas court found that a general contractor was considered the joint employer of its subcontractor’s employees and therefore that the general contractor was responsible for wage violations under the Fair Labor Standards Act (FLSA). The Salinas decision and the new standard it set for joint employment represent a significant change from the more than 30-year precedent on joint employment. This means contractors — and other entities who could be considered joint employers — need to understand the risks involved in joint employment and try, to the extent possible, to manage that risk.

Defining Joint Employment

So, what is joint employment? It generally occurs in two scenarios: horizontal joint employment and vertical joint employment. Vertical joint employment is the type at issue in Salinas and the type more likely to be applicable in the construction industry. The typical scenario is one where a contractor arranges or contracts with an intermediary employer to provide the contractor with labor in certain scenarios — in essence, the contractor-subcontractor relationship. Vertical joint employment can also arise when a contractor or subcontractor contracts or engages with a staffing company to provide it with laborers for a certain project or merely to carry out certain employer functions, like administering payroll and benefits.

Due to the Salinas decision, the law in the Fourth Circuit (North Carolina, South Carolina, Virginia, West Virginia, or Maryland) is that alleged joint employers must be “completely disassociated” from the intermediary employer. Otherwise, they will be considered joint employers of the intermediary’s employees. The court set forth six factors that determine whether two entities are not completely disassociated. Here are the factors with some analysis of how they could be applied to a general contractor-subcontractor or contractor-staffing firm relationship:

  1. “Whether, formally or as a matter of practice, the putative joint employers jointly determine, share, or allocate the power to direct, control, or supervise the worker, whether by direct or indirect means;”

If a general contractor and subcontractor agree — or if they operate in such a way — that the contractor has the authority to direct the subcontractor’s employees, set their schedules and work assignments, enforce project site rules, and/or supervise their employees, this factor would support a finding of joint employment. Similarly, if a subcontractor contracts with a staffing firm for laborers and the subcontractor has the authority to set workers’ hours and locations, and/or dictate how they perform their work, the subcontractor is probably a joint employer.

  1. “Whether, formally or as a matter of practice, the putative joint employers jointly determine, share, or allocate the power to — directly or indirectly — hire or fire the worker or modify the terms or conditions of the worker’s employment;”

When this factor is applied, any contractor who is authorized to assign a subcontractor’s or staffing firm’s employee to a particular project — or remove the individual from a project site — will likely be considered a joint employer of that individual.

  1. “The degree of permanency and duration of the relationship between the putative joint employers;”

Many general contractors establish long-term working relationships with certain subcontractors and/or staffing agencies and work with the same companies repeatedly on many jobs. These contractors are at risk of being found to be joint employers. Likely at an even higher risk are contractors that have few to no employees on their payroll and instead retain all of their workers through an intermediary, such as a staffing firm. These contractors may believe that using staffing firms reduces or eliminates their liability under federal and state employment laws. While it might allow these companies to delegate administrative functions like administering payroll and benefits, the law in the Fourth Circuit won’t allow them to avoid much liability.

  1. “Whether, through shared management or a direct or indirect ownership interest, one putative joint employer controls, is controlled by, or is under common control with the other putative joint employer;”

This scenario is perhaps less common than the others but appears to apply when a contractor controls a subsidiary or affiliate. The contractor could be considered the employer of the subsidiary, affiliate, or indirectly owned entity.

  1. “Whether the work is performed on a premises owned or controlled by one or more of the putative joint employers, independently or in connection with one another;”

Most general contractors or construction management firms are obligated to control and supervise the project site. This factor, as applied to such firms, would establish them as joint employers of subcontractors’ and staffing firms’ employees.

  1. “Whether, formally or as a matter of practice, the putative joint employers jointly determine, share, or allocate responsibility over functions ordinarily carried out by an employer, such as handling payroll; providing workers’ compensation insurance; paying payroll taxes; or providing the facilities, equipment, tools, or materials necessary to complete the work.”

This factor pertains to the above scenario where entities try to delegate certain employer functions to staffing agencies. Virtually every staffer/client agreement is one where the parties “jointly determine” who has what responsibility for these functions. Even if the staffing agency is in charge of screening, payroll, workers’ compensation, and benefits, if the client performs any employer functions — like supervision, hiring, firing, and/or providing instructions, tools, or materials — then the client will likely be seen as a joint employer.

Examine Your Business Model

If a court within the Fourth Circuit is faced with any federal employment issue and a joint employment question exists, it will consider the above factors. Such a court would then likely analyze whether the laborers in question are employees or independent contractors — another, separate test. But the Salinas factors alone are enough to cause concern for most contractors who contract for labor.

Because the above factors apply regardless of the terms of any subcontract or staffing agreement, consulting with counsel about how to better draft those agreements is only one step for contractors who are concerned about expanded liability. They also need to consult with counsel about the way they conduct business and whether it still works in light of the expanded joint employment doctrine.

Otherwise, they should understand that they may have more employees than they realized.

 

 

This article is not intended to give, and should not be relied upon for, legal advice. No action should be taken in reliance upon the information contained in this article without obtaining the advice of an attorney.

Recent Changes in Tax Legislation Could Save You or Cost You Beginning in 2018

The recently enacted Tax Cuts and Jobs Act (TCJA) is a sweeping tax package. Everyone in business — including roofers — should have at least a passing knowledge of what to expect beginning in tax year 2018. Most of the changes are effective for tax years beginning in 2018 and lasting through 2025.

Tax rates — personal and corporate. The new law imposes a new tax rate structure with seven tax brackets: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent, and 37 percent. The top rate was reduced from 39.6 percent to 37 percent and applies to taxable income above $500,000 for single taxpayers and $600,000 for married couples filing jointly.

The corporate income tax rate used to be graduated with a maximum cap at 35 percent. It was reduced to a flat 21 percent. The corporate tax rate reduction puts the United States in line with most of the rest of other developed nations. The reduction is designed to increase spending, increase jobs, increase employee salaries, foster corporate improvements, and continue to incentivize the overall economy.

Standard deduction. The new law increases the standard deduction to $24,000 for joint filers, $18,000 for heads of household, and $12,000 for singles and married taxpayers filing separately. Given these increases, many taxpayers will no longer be itemizing deductions. These figures will be indexed for inflation after 2018.

Exemptions. The new law suspends the deduction for personal exemptions. Thus, starting in 2018, taxpayers can no longer claim personal or dependency exemptions. The rules for withholding income tax on wages will be adjusted to reflect this change, but IRS was given the discretion to leave the withholding unchanged for 2018.

New deduction for “qualified business income.” Starting in 2018, taxpayers are allowed a deduction equal to 20 percent of “qualified business income,” otherwise known as “pass-through” income, i.e., income from partnerships, S corporations, LLCs, and sole proprietorships. The income must be from a trade or business within the United States. Investment income does not qualify, nor do amounts received from an S corporation as reasonable compensation or from a partnership as a guaranteed payment for “services” provided to the trade or business. In other words, lawyers are out of luck! The deduction is not used in computing adjusted gross income, just taxable income. For taxpayers with taxable income above $157,500 ($315,000 for joint filers), (1) a limitation based on W-2 wages paid by the business and depreciable tangible property used in the business is phased in; and (2) income from the following trades or businesses is phased out of qualified business income: health, law, consulting, athletics, financial or brokerage services, or where the principal asset is the reputation or skill of one or more employees or owners.

Child and family tax credit. The new law increases the credit for qualifying children (i.e., children under 17) to $2,000 from $1,000, and increases to $1,400 the refundable portion of the credit. It also introduces a new (nonrefundable) $500 credit for a taxpayer’s dependents who are not qualifying children. The adjusted gross income level at which the credits begin to be phased out has been increased to $200,000 or $400,000 for joint filers.

State and local property taxes. The itemized deduction for state and local income and property taxes is limited to a total of $10,000.00 starting in 2018.

Mortgage interest. Under the new law, mortgage interest on loans used to acquire a principal residence and a second home is only deductible on debt up to $750,000, starting with loans taken out in 2018. This sum is down from $1 million. There is no longer any deduction for interest on home equity loans, regardless of when the debt was incurred.

Miscellaneous itemized deductions. There is no longer a deduction for miscellaneous itemized deductions which were formerly deductible to the extent they exceeded 2 percent of adjusted gross income. This category included items such as tax preparation costs, investment expenses, union dues, and unreimbursed employee expenses.

Medical expenses. Under the new law, for 2017 and 2018, medical expenses are deductible to the extent they exceed 7.5 percent of adjusted gross income for all taxpayers. Previously, the adjusted gross income floor was 10 percent for most taxpayers.

Casualty and theft losses. The itemized deduction for casualty and theft losses has been suspended except for losses incurred in a federally declared disaster.

Overall limitation on itemized deductions. The new law suspends the overall limitation on itemized deductions that formerly applied to taxpayers whose adjusted gross income exceeded specified thresholds.

Moving expenses. The deduction for job-related moving expenses has been eliminated, except for certain military personnel. The exclusion for moving expense reimbursements has also been suspended.

Health care “individual mandate.” Starting in 2019, there is no longer a penalty for individuals who fail to obtain minimum essential health coverage.

Estate and gift tax exemption. Effective for decedents dying, and gifts made, in 2018, the estate and gift tax exemption has been increased to roughly $11.2 million ($22.4 million for married couples).

A lot of the details of the simple descriptions listed above remain to be completely formalized, and some of it may still change. Stay aware of the tax revisions and consult with an attorney in your locale if you have any questions.

Updated NIBS Study Proves Mitigation Is a Sound Investment

Table 1. Benefit-cost ratio by hazard and mitigation measure. Courtesy of the National Institute of Building Sciences.

More than a decade ago, the National Institute of Building Sciences (NIBS), a nonprofit mandated by Congress to improve building process and facility performance, issued a landmark report which changed the conversation about the value of resilience. The 2005 report, Natural Hazard Mitigation Saves, was authored by NIBS’ Multihazard Mitigation Council (MMC), which promotes collaboration to achieve resilience objectives among a broad spectrum of stakeholders. Working from data provided by the Federal Emergency Management Agency (FEMA), the report found that every $1 of natural hazard mitigation funded by the FEMA between 1993 and 2003 saved the American people an average of $4 in future losses. That one to four ratio of investment to returns was widely quoted at the time that the report was published, and has been cited repeatedly during the past decade as interest in resilience grown. This report was among the first to demonstrate that investment in mitigation could deliver significant returns.

During the intervening years, as the frequency and severity of natural disasters has intensified, MMC leadership recognized the need to update and expand the 2005 study. Philip Schneider, AIA, Director of the MMC, explains that the “disaster landscape” has changed since 2005, necessitating a new report. “Our hazard maps, particularly, for earthquake and wind, have had several updates based on more research and better data. Our codes and standards are much improved for creating disaster resistance than they were over ten years ago. Our exposure to disasters, especially, building in disaster-prone areas, has increased substantially. We also have better methods for determining vulnerability to disasters than we had then, and more sophisticated economic analysis tools.’’ In fact, as part of the changed “disaster landscape” that Schneider references, 2017 set unwelcome records related to climate and weather events. According to a report released by the National Oceanic and Atmospheric Administration (NOAA) in early January, the U.S. experienced 16 separate billion-dollar disaster events, matching 2011 for the record number of billion-dollar disasters for an entire calendar year. Together, these events cost the country more than $300 billion dollars, a new annual record for the United States. While this data was released after the publication of the MMC report, it underscores the urgent need to lessen the financial impact of these increasingly frequent disasters.

Figure 1. Total costs and benefits of 23 years of federal mitigation grants. Courtesy of the National Institute of Building Sciences.

After a year-long effort, the MMC released its updated report in January of this year. Natural Hazard Mitigation Saves: 2017 Interim Report examined two specific mitigation strategies and found that mitigation is of even greater value now than it was when the first report was released. First, based on updated data on the impact of FEMA grants, the report stated that society now saves $6 for every $1 spent on mitigation. Looking at a second mitigation strategy, the report found a corresponding “benefit-cost” ratio of four to one for spending that exceeded select provisions of the 2015 International Code Council building codes. In summarizing its findings for both strategies, the MMC stated that, “Mitigation represents a sound financial investment.” (For the purposes of this study mitigation and resilience have similar meanings. Schneider says, “For both terms there is no one universal definition; they both are broadly defined with considerable overlap. However, resilience tends to be more community-based, taking into account a wider range of infrastructure, economic, environmental and social issues. Mitigation tends to be more building centric, but still can pertain to a subset or even the same set of wider range issues.”)

The report points out that while mitigation strategies deliver financial rewards, they would also provide other significant benefits. Implementing the two sets of mitigation strategies detailed in the report “would prevent 600 deaths, 1 million nonfatal injuries and 4,000 new cases of post-traumatic stress disorder in the long term.” Additionally, the report projects that designing new buildings to exceed the model ICC building codes would help fuel economic growth, “resulting in 87,000 new, long-term jobs, and an approximate 1 percent increase in utilization of domestically produced construction material.”

Natural Disasters

The report specifically looked at four potentially cataclysmic natural forces: hurricane winds, earthquakes, riverine floods and hurricane surges. Then they looked at five stakeholder groups that would bear the costs and enjoy the benefits of mitigation for the four natural hazards under consideration. These stakeholder groups are:

  1. Developers: corporations that invest in and build new buildings, and usually sell those buildings once they are completed, owning them only for months or a few years
  2. Title holders: people or corporations who own existing buildings, generally buying them from developers or prior owners
  3. Lenders: people or corporations that lend a title holder the money to buy a building
  4. Tenants: people or corporations who occupy the building, whether they own it or not
  5. Community: people, corporations, local government, emergency service providers, and everyone else associated with the building or who does business with the tenant

Figure 2. Total costs and benefits of new design to exceed 2015 I-Code requirements. Courtesy of the National Institute of Building Sciences.

The study reports that when the cost each group bears to mitigate a loss is subtracted from the positive benefits it enjoys, the “net benefit” is positive in each category. In other words, the value of investing in mitigation is spread broadly across the construction business and the people it serves.

The authors of the report are careful to point out that the cited benefit-cost ratios, or BCRs, are generated from two very specific mitigation strategies: those used by FEMA, and those incorporating designs that exceed provisions of ICC codes. Noting that the results from the 2005 study represented only a single, very narrow set of strategies but were incorrectly used to justify “all types of mitigation strategies,” the authors of the study specifically say that they did not provide an aggregate number in the updated study, but elected to provide BCRs for the two strategies individually. Moving forward, providing an aggregate number is definitely one of their goals: “Once the project team has identified BCRs for a sufficient number of mitigation strategies, it will provide an aggregated number representing the overall benefit of mitigation.” To help achieve that goal, multiple studies are being conducted by the MCC to examine the value of many kinds of natural hazard mitigation at the national level, and more studies are being planned, pending the acquisition of funding.

Focusing on the Roof

What do the results of this study mean for those who focus on the integrity of a roofing system to help create a resilient structure? Schneider underscores the importance of a resilient roof as a component of an overall mitigation strategy. “If the roofing system is compromised in either a windstorm or wildfire, the building or home is subject to total loss.” He also observes that achieving resilience, either in an entire community or in an individual structure, will be a combined effort. “Resilience will be best implemented when states and communities develop and effect resilience plans. Communities, particularly, need to address zoning. Codes and standards organizations need to constantly be updating their documents to address resilience, and architects, engineers, developers and contractors should be building to resilience standards. Manufacturers have their part in providing more resilient products and systems.”

The NIBS report is being praised as an important tool to help in decision-making about investment in resilience, and influential stakeholders are supporting its approach. Executive Director Paul Kovacs of the Toronto-based Institute for Catastrophic Loss Reduction says, “Findings of the 2005 report, that resilience offers a societal payback of $4 for every $1 invested in mitigation, made an extremely important contribution to the argument that building resilience towards natural hazards is not costly in the mid- to long-term and, in fact, offers a solid Return on Investment. The 4:1 ratio became the most commonly cited metric to show that resilience works, that such things as building codes work. The updated study released yesterday puts a finer point on the metrics and continues to offer overwhelming evidence that building resilience is key to avoiding death, injuries, property damage and disruption.”

Mike DuCharme, Chairman of the EPDM Roofing Association (ERA), adds support from the manufacturers’ point of view. “We know that our EPDM products can play an essential role in helping to create more resilient roofing systems. With this new report showing the economic advantages of resilience, we can provide the construction industry with materials that can not only enhance the performance of a resilient roofing system, but also provide financial advantages as well.”

The NIBS report concludes by pointing out that, “Not everyone is willing or able to bear the up-front construction costs for more resilient buildings, even if the long-term benefits exceed the up-front costs,” and suggests that some creative incentives might be needed “to align competing interests of different groups.”

FEMA, the source of the statistics for the NIBS report, is addressing this very issue and has just released its Draft National Mitigation Investment Strategy at the request of the Department of Homeland Security. This strategy is meant to address the lack of coordination in mitigation investment and is organized to achieve these six outcomes:

  1. Coordination of risk mitigation and management improves between and among public, private, and non-profit sector entities.
  2. The private and nonprofit sectors increase their investments in and innovations related to mitigation.
  3. State, local, tribal and territorial governments are increasingly empowered to lead risk reduction activities and share responsibility and accountability with the federal government.
  4. Public, private, and nonprofit sector entities develop and share more of the data and tools needed to make risk-informed mitigation investments.
  5. Public, private, and nonprofit sector entities improve risk communication, leading to more risk-informed mitigation investments by individuals and communities.
  6. The built environment — whether grey or nature-based infrastructure, and including lifeline infrastructure, buildings, and homes — becomes more resilient

This Draft report is now available for comment and FEMA will continue to research the issue before releasing its final recommendations.

This increasing focus on the issue of resilience has moved the debate forward, beyond where it was just a year ago at this time. The question is no longer whether resilience is needed; the daunting statistics of 2017 confirm that cataclysmic weather events are on the increase and can cause staggering damage to the built environment. The NIBS report provides hard evidence that resilience is an investment in the future that will pay dividends for years to come. The debate now moves forward to the best ways to finance these mitigation efforts, so that those future dividends can be realized.

How Sales Management Can Hurt Sales

There’s a sales management philosophy in too many companies that is actually working against sales growth. And the salespeople know it. The philosophy goes like this:

  • Walk in 40 doors a day.
  • Make 40 calls a day.
  • Hand your business card to everyone.
  • Gather as many business cards as you can.
  • Sell, sell, sell.

While this is a lot of activity and can look good on a sales report, it isn’t usually productive. And it shifts the goal from getting business to participating in a specific behavior.

This usually happens because the owner or sales manager found great success using these methods. That’s great for them! But it doesn’t mean everyone is going to be successful doing it that way.

sIn addition, today’s business environment doesn’t really offer a welcoming landscape for this kind of behavior. The consumers are very well educated and are really looking for someone they trust. The salesperson is better off working on relationship building rather than tallying the number of doors knocked.

Many companies with this philosophy have a lot of turnover in the sales department. And do you know why? Because people join the company with the best of intentions and in many cases a great method for gaining sales. When they discover that they can’t implement their method, but rather have to engage in behavior that doesn’t work for them, they don’t hit their sales goals. So, they leave — either voluntarily or by request.

Either way, it’s not good for the company. The cost alone of bringing on a new employee is significant. Think about it. You’ve got to run ads, sift through resumes, interview, hire, onboard, train, and then exit. Go ahead and put dollar values on each of those items, then add them up. Now include the lack of sales into the cost. All the business you didn’t do! It’s an expensive proposition.

Building Confidence

Another key concern is the image that develops of the company in the community. Think about things from the prospect or client’s point of view. If, every time they turn around there’s a new salesperson introducing themselves, you’re telegraphing instability within your company. Is that really the message you are trying to send? Customers want confidence that the salesperson they’ve grown to trust will be there for more than a hot minute. If they keep seeing new salespeople, their trust goes down. That’s never good.

So, I ask you, which is more important?

  1. Engaging in a specific activity
  2. Gaining new clients

I’d say No. 2. And if that really is more important, then it doesn’t matter how it is done — as long as it is moral, legal, and ethical.

Sales managers would be better off sharing the vision and the goals of the company with their sales staff while leaving the sales strategy to each salesperson. Empower the sales team to develop their own process and then monitor their results. Give them the resources they need to be successful. Be there for them when they need advice, or training. And communicate with them on a regular basis about their results. As long as the results are there, the process shouldn’t matter.

Think about why you hire someone. Is it because you believe they have the skills and personality necessary to succeed at sales? Probably. And if so, don’t you owe it to them to trust them to do the job? Whenever we tell someone how to do something, we’re really saying that we don’t trust them to do it right. There’s a confidence killer!

It’s like hiring someone for their great attitude and then squashing that attitude. Makes no sense. Respecting the sales staff means talking with them, not at them. It means listening to what they have to say, respecting their ability, and expecting them to deliver. Period. The best way to disrespect the sales staff is to tell them to do things your way. Then you are telling them that you don’t trust them to do it right, or well, or successfully. Believe me when I tell you, you won’t get what you are wanting if you engage in this sort of “management.” Instead, lead your team. Help them be the best they can be.

After all, sales is about relationships, not dialing for dollars. Let your salespeople network and develop relationships with referral partners, prospects, and clients. Their time will be better spent, the results will be there, and everyone will be happier. If one of the salespeople decides to make 40 calls a day, great! That is their preferred method. It should be more important to make sure your salespeople have a strategy that makes sense to them than to have a strategy that only makes sense to the sales manager.

ARMA Honors Top Asphalt Projects With QARC Awards

The QARC Gold award was presented at the International Roofing Expo in New Orleans, where Imbus Roofing received a $2,000. Pictured are Bob Gardiner, CertainTeed; Steve Sutton, Imbus Roofing; Andrew Imbus, Imbus Roofing; Tom Smith, CertainTeed and Ron Gumucio, ARMA.

The Asphalt Roofing Manufacturers Association (ARMA) recognized a historic music hall, a home with a roof built to withstand high-wind events, and a museum dedicated to the United States’ fight for independence as 2017’s top asphalt roofing installations. ARMA’s annual Quality Asphalt Roofing Case-Study (QARC) Awards Program awarded the projects that exemplify the most beautiful, affordable and reliable asphalt roofing systems in North America.

Imbus Roofing Co. Inc. received the Gold QARC Award for its new roof installation on the 225,000 square-foot, 139-year-old Cincinnati Music Hall. The Kentucky-based contractor installed designer asphalt shingles to replicate the Music Hall’s slate tile roof, while also providing crucial durability against Cincinnati’s tough climate.

Reliant Roofing Inc. was honored with the Silver QARC Award for its completion of Topsail Residence, a 10,600-square-foot asphalt shingle roofing system designed to endure high-wind events in Ponte Vedra, Florida. This high-performance roofing system not only provided the homeowners with a durable option, but also a visually stunning roof for years to come.

The Bronze QARC Award was given to Thomas Company Inc. of Egg Harbor Township, New Jersey, for its low-

slope installation on Philadelphia’s Museum of the American Revolution. Designed to achieve LEED Gold certification, the project featured a high-quality modified bitumen roof membrane to prevent water penetration and create a more stable surface for the facility’s vegetative roof.

According to ARMA, the 2018 QARC Award program received some of the most impressive and innovative submissions of asphalt roofing installments to date. “This year’s submissions demonstrated asphalt’s ability to provide a durable and reliable roofing system against harsh weather while simultaneously offering an array of beautiful colors, designs and installation options,” said Ralph Vasami, ARMA’s acting executive vice president. “These projects are true examples of what asphalt roofing can offer commercial businesses and private homeowners alike.”

The 2018 QARC Award recipients are:

Gold
Project Name: The Cincinnati Music Hall
Company: Imbus Roofing Co. Inc.
Project Description: This steep-slope roof was installed with CertainTeed’s Grand Manor luxury asphalt shingles in the colors Stonegate Gray and Brownstone, as well as DiamondDeck and WinterGuard underlayments. The size, complexity and steepness of the project presented a great challenge to the contractor, who managed to install a durable asphalt roofing system that was also visually stunning.

Imbus Roofing received top honors for its work on 139-year-old Cincinnati Music Hall. Photo: CertainTeed

Silver
Project Name: Topsail Residence
Company: Reliant Roofing Inc.
Project Description: GAF Grand Canyon Lifetime Designer Shingles in the color Stone Wood was selected not only for its beauty, but its superior high-wind protection. Hand sealed Timbertex Premium Ridge Cap Shingles and GAF self-adhering Leak Barrier were also installed for added leak prevention.

Reliant Roofing received the Silver QARC Award for its completion of Topsail Residence in Ponte Vedra, Florida. Photo: Justin Alley and Kyle Brumbley

Bronze
Project Name: Museum of the American Revolution
Company: The Thomas Company Inc.
Project Description: The historic project required a high-quality roofing membrane that offered an aesthetic appeal to the building. Thomas Company chose SOPREMA’s SBS Modified Base Ply – ELASTOPHENE Flam with the SBS Modified Bitumen Flashing Base Ply – SOPRALENE Flam 180 to keep the roof water-resistant year-round, protect the roof membrane from foot traffic and add a beautiful appearance to the museum.

The Bronze QARC Award was given to Thomas Company Inc. of Egg Harbor Township, New Jersey, for its work on Philadelphia’s Museum of the American Revolution. Photo: Soprema

Honorable Mentions:
Big House Castle Rock
Jireh 7 Enterprises
Castle Rock, Colorado
Malarkey Roofing Products

Closson Chase Winery Church Roof
AI Anthony Roofing LTD
Hillier, Ontario
IKO Production Inc.

Tiny House & Top Shop
M & J Construction
Erhard, Minnesota
CertainTeed Corporation

West Loch Village Senior Apartments
M & R Roofing
Ewa Beach, Hawaii
PABCO Roofing Products

For more information about this year’s winners or to submit an asphalt roofing project, visit www.asphaltroofing.org.

Changes to Contractor/Subcontractor Agreement Can Have Profound Effect on Roofers

Whether they like them or not, most subcontractors and contractors have used American Institute of Architects (AIA) standard form contract documents at some point in their careers. Several options exist for those wanting to utilize standard form documents, like ConsensusDocs, Design-Build Institute of America, and the Engineers Joint Contract Documents Committee forms. However, the AIA, being founded in 1857 and having published standard form construction contracts for more than 100 years, is the most established of these organizations, and its form contracts are still the most prevalent and most commonly used forms for commercial construction projects in the United States.

The AIA updates its forms every 10 years and completed its most recent revision in late April 2017. The updates included revisions to several forms in its A-Series (Owner/Contractor Agreements), including its widely used General Conditions (AIA Form A201) and its standard Contractor/Subcontractor Agreement, AIA A401. While these are only a few of the AIA’s updates, these changes may be particularly pertinent to subcontractors and those working in the roofing construction industry. Some highlights of the 2017 updates to A401 follow here.

Designated Representatives and Notices

Both the Contractor and Subcontractor are now required to designate (in the space provided in Section 14.2) an individual who will serve as each party’s “representative” for the project. This requirement is set forth in Section 3 for the Contractor and Section 4 for the Subcontractor. Parties are permitted to change their designated representative only if they provide 10 days’ notice. This is significant for both parties because the updated form requires that notices — for example, notices of a party’s potential claim arising from the subcontract — must be made in writing and are valid only if served upon the designated representative. The new form allows notices to be made via e-email or other electronic means only if an electronic method is set forth in Section 14.4.3. Parties should remember not only to designate a point person who is prepared to serve as a project representative and an email address for notices, but they should also ensure that the other party has done the same. Failure to do so could result in notices not being made by the proper means and to the proper individual — which in turn could result in parties waiving potential claims.

New Contractor Responsibilities — With Limitations

Although it has long been a standard practice (both on AIA projects and elsewhere) for the Contractor to include the prime contract as an exhibit to the subcontract, the updated form takes this a step further and requires the prime contract to be attached to the subcontract as “Exhibit A.” If Subcontractors hold Contractors to this requirement, Subcontractors will be able to review all of the contract documents with greater ease before signing.

Furthermore, Section 3 requires Contractors to “render decisions in a timely manner and in accordance with the Contractor’s construction schedule” and to “promptly notify the Subcontractor of any fault or defect in the Work under this Subcontract or nonconformity with the Subcontract documents.” However, in Sections 3.4.4 and 3.4.5, the phrase “written notice” has been changed simply to “notice” with respect to the Contractor’s requirement to notify the Subcontractor of defective work as a prerequisite of finding the Subcontractor to be in default. Section 14 still clearly states that all “notices” must be made in writing to the designated representative. This change could result in debate over what Contractors must do in order to notify Subcontractors of defective work before they avail themselves of remedies for breach, such as withholding subcontract payments.

Contractors also now have additional duties to provide Subcontractors information they may need in order to preserve their lien rights. Section 3.3.6 previously required Contractors to provide Subcontractors “a correct statement of the record legal title to the property … and the Owner’s interest therein.” The revised A401 now requires the Contractor to request this information from the Owner if the Contractor does not have it and give the Subcontractor the information upon receipt; a corresponding section in AIA A201 requires the Owner to provide it to the Contractor.

New Subcontractor Duties and Concerns

The above requirement to submit lien information is perhaps balanced by revised Section 11.1.10, which provides Contractors additional rights to indemnification from certain lien claims. “If Contractor has paid Subcontractor in accordance with the Agreement, Subcontractor must defend and indemnify the Contractor and Owner from liens and claims from lower tier subcontractors and suppliers, including being required to bond off liens,” the new form states.

Another noteworthy change concerns alternates — alternatives to a base bid that provide for a change in the level of quality, or scope of the work specified in the base bid. Alternates provide the owner with the option to modify the project by accepting or rejecting the alternate. The newly revised A401 contains a new section, 10.2.2, which allows the parties to list alternates that the Contractor can accept after execution of the agreement. Subcontractors should consider carefully whether it is wise to include alternates under this section.

Payment and Retainage

Finally, subcontractors and contractors alike should familiarize themselves with the newly revised Section 11, which concerns progress payments. Sections 11.1.7.1 and 11.1.7.2 break down the calculation of progress payments into separate subsections for additions, deletions, and retainage. This includes additions for construction change directives and deletions to allow for defective work remaining uncorrected (assuming that Contractor has duly notified the Subcontractor of the issue). Other portions of A401 allow for additions and deletions in these scenarios, but they are often conditioned on the owner’s approval and other factors. It remains to be seen whether this section could change normal progress billing procedures.

Section 11.7.2 opens the door to retainage options other than the typical arrangement (where the Contractor simply withholds the amount the Owner is withholding). Newly added subsections allow the parties to designate items that are not subject to retainage, as well as set forth an arrangement for reduced or limited retainage. This new section (11.1.8.2) could be a helpful avenue for early finishing trades to propose release of retainage upon 50 percent completion of the project as opposed to substantial completion — or even a way for parties to negotiate the retainage percentage down.

The above are just a few highlights of changes to AIA Form A401. For additional information or questions, visit www.aiacontracts.org or email Caroline Trautman at ctrautman@andersonandjones.com.

 

This article is not intended to give, and should not be relied upon for, legal advice. No action should be taken in reliance upon the information contained in this article without obtaining the advice of an attorney.

Single-Ply Roofing Best Practices: Doing Everything Right the First Time.

Figure 1: Designing resilient roof systems is the best of practices. When developing details, we find it very helpful to draft out the roof system (for each different system), noting materials and installation methods. Photos: Hutchinson Design Group

Single-ply membranes have risen from being the “new guy” in the market in the early ’80s to become the roof cover of choice for most architects, consultants and contractors. Material issues have for the most part been resolved, and like no other time in recent history, the industry is realizing a period of relative calm in that regard. Whether EPDM, TPO or PVC, the ease of installation, the cleanliness of the installation (versus the use of hot or cold bitumen), the speed at which they can be installed, and the material costs all blend to make these materials a viable option for watertight roofing covers. But with this market share comes issues and concerns, some of which are hurting owners, giving forensic consultants such as myself too much business, enriching attorneys, and costing contractors and, at times, designers dearly.

Following are some of my thoughts on various issues that, in my opinion, are adversely affecting single-ply membrane roof systems. Paying attention to these issues will bring about best practices in single-ply applications.

Specifying the Roof by Warranty

OMG, can architects do any less? Don’t get me started. The proliferation of “canned” Master Specs which call for a generic 10-year or 20-year warranty and then state to install the product per manufacturer’s guidelines is disheartening. Do

Figure 2: Coordinating with the mechanical engineer in the detailing of the pipe penetrations is critical. Here you can see all the components of the curb, penetrations, roofing and waterproofing are noted. We recommend that the same detail be on the mechanical sheets so that at least an 18-inch curb is known to all. Photos: Hutchinson Design Group

designers realize that manufacturers’ specifications are a market-driven minimum? When architects leave out key details, they are simply relying on the roofing contractor to do what is right. This deserves another OMG. The minimum requirements for a warranty can be very low, and the exclusions on a warranty quite extensive. Additionally, a design that calls for products to be installed based on achieving a warranty may result in a roof system that does not meet the code. Owners are often oblivious to the warranty requirements, and all too often fail to ensure the standard of care until the service life is shortened or there is storm damage — sometimes damage the roof should have withstood if it were properly designed and detailed.

If one is not knowledgeable about roof system design, detailing and specification, then a qualified roof consultant with proven experience in single-ply membranes should be retained. Roof systems and their integration into the impinging building elements need to be designed, detailed and specified appropriately for the building’s intended use and roof function. By way of example, we at Hutchinson Design Group typically design roof systems for a 40- to 50-year service life (see Figure 1); the warranty at that point is nice, but almost immaterial. Typical specifications, which are project specific, cover all the system components and their installation. They are typically 30 pages long and call out robust and enhanced material installations.

More Than the Code

I recently had a conversation with a senior member of a very large and prominent architectural firm in the Chicago area and inquired about how they go about designing the roof systems. The first thing he said was, “We do what is required by code.”

Photo 1: The roof drain sump pans shown here were provided and installed by the plumbing contractor, not the steel deck installer. Having the roof drain level with the top of the roof deck allows for a proper integration of the roof drain and roof system.

What I heard was, “We give our clients the absolute poorest roof the code allows.” An OMG is allowed here again. Does it really need to be said again that the code is a minimum standard — as some would say, the worst you are allowed to design a building by law? Maybe you didn’t realize it, but you are allowed to design above the code. I know this will shock a few of you, but yes, it’s true. Add that extra anchor to prevent wood blocking from cupping. Add extra insulation screw fasteners to improve wind uplift resistance; if too few are used, you may meet the code, but your insulation will be susceptible to cupping. Add that extra bead of polyurethane adhesive. (If I specify 4 inches on center, then perhaps by mid-day, on a hot and humid day, I might get 6 inches on center — as opposed to specifying 6 inches or 8 inches on center, and getting 12 inches on center in spots.) Plan for construction tolerances such as an uneven decks and poorly constructed walls. Allow for foot traffic by other trades. These types of enhancements come from empirical experiences — otherwise known as getting your butt in the ringer. Architects need more time on the roof to observe what goes on.

It’s About Doing What is Right

Doing it right the first time isn’t all that difficult, and it’s certainly less stressful than dealing with the aftermath of doing so little. The cost of replacing the roof in the future could easily be more than double the original cost. Twenty years ago, I

Figure 3: Coordinating with the plumbing engineer, like coordinating with the mechanical engineer, is a requirement of best practices. In this drain detail, we can see the sump pan is called out correctly, and the roof drain, integration of the vapor barrier, extension ring, etc., are clearly defined. Photos: Hutchinson Design Group

chaired an international committee on sustainable low-slope roofing. At that time, the understanding of sustainability was nil, and I believe the committee’s Tenets of Sustainability, translated into 12 languages, helped set the stage for getting designers to understand that the essence of sustainability is long-term service life. That mantra seems to have been lost as a new generation of architects is at the helm. This is unfortunate, as it comes at a time when clients no longer ask for sustainable buildings. Why? Because they are now expected. The recent rash of violent and destructive storms — hurricanes, hail, intense rain, high winds and even wildfires — have resulted in calls for improvement. That improvement is called resiliency. If you have not heard of it, you are already behind. Where sustainability calls for a building to minimize the impact of the building (roof) on the environment, resiliency requires a building (roof) to minimize the impact of the environment on the building. This concept of resiliency requires designing a roof system to weather intense storms and to be easily repaired when damaged. (Think of Puerto Rico and consider how you would repair a roof with no power, limited access to materials, and manpower that might not be able to get to your site.)

Achieving resiliency requires the roof system designer to:

  1. Actually understand that roofs are systems and only as good as their weakest link. Think metal stud parapet and horizontal base anchor attachment; only forensic consultants and attorneys like to see screws into modified gypsum boards.
  2. Eliminate your old, out-of-date, incorrect details. Lead vent flashing and roof cement cannot be used with single-ply membrane.
  3. Design the roof system integration into associated barrier systems, such as where the roofing membrane (air/vapor retarder) meets the wall air barrier. You should be able to take a pencil and draw a line over the wall air barrier, up the wall and onto the roof without lifting it off the sheet. If you cannot, you need to redesign. Once you can, you need to consider constructability and who may get there first — the roofer or air barrier contractor. Then think material compatibility. Water-based air barrier systems don’t react well when hit with a solvent-based primer or adhesive.

    Photo 2: This roof drain is properly installed along with 6 inches of insulation and a cover board. The drain extension ring is 1/2 inch below the top of the cover board so that the water falls into the drain and is not held back by the clamping ring, resulting in ponding around the roof drain.

    Perhaps the roofing needs to be in place first, and then the air barrier brought over the top of the roofing material. This might require a stainless-steel transition piece for incompatible materials. Maybe this requires a self-adhering membrane over the top of the roof edge prior to the roofing work, as some membranes are rather rigid and do not bend well over 90-degree angles. You as the designer need to design this connectivity and detail it large and bold for all to see.

  4. Design the roof system’s integration into the impinging building elements, including:
  • Roof curbs for exhaust fans: Make sure they are insulated, of great enough height, and are not installed on wood blocking.
  • Rooftop unit (RTU) curbs: The height must allow for future re-roofing. Coordinate with the mechanical engineer regarding constructability – determine when the curb should be set and when the HVAC unit will be installed. Roof details should be on both the architectural and mechanical drawings and show the same curb, drawn to scale. Be sure the curb is insulated to the roof’s required R-value. Avoid using curb rails to support mechanical equipment. The flashing on the interior side of the rails may be inaccessible once the equipment is placed. Use a large curb where all four sides will remain accessible.
  • Piping penetrations: Detail mechanical piping penetrations through the roof and support of same, where insulation and waterproofed pipe curbs are needed (see Figure 2). If you are thinking pourable sealer pocket, stop reading and go sign up for RCI’s Basics of Roof Consulting course.
  • Roof curbs, RTU, pipe curbs and rails: Coordinate their location and show them on the roof plan to be assured that they are not inhibiting drainage.
  • Roof drains: Coordination with the plumbing engineer is essential. Sump pans should be installed by the plumbing contractor, not the steel deck installer (see Photo 1), and the location should be confirmed with the structural engineer. Be sure drains are located in the low point if the roof deck is structurally sloped — and if not, know how to design tapered insulation systems to move water up that slope. Do not hold drains off the deck to meet insulation thickness; use threaded extensions. Be sure any air/vapor barrier is integrated into the curb and that the insulation is sealed to the curb. I like to hold the drain flange a half-inch down below the insulation surface so that the clamping ring does not restrain water on the surface. Owners do not like to see a 3-foot black ring at the drain, where ponding water accumulates debris (see Figure 3 and Photo 2).
  1. Understand the roof’s intended use once the building is completed. Will the roof’s surface be used for anything besides weather protection? What about snow removal? Will there be excessive foot traffic? What about mechanical

    Photo 3: Gaps between the roof insulation and roof edges, curbs and penetrations are prevalent on most roofing projects and should be sealed with spray foam insulation as seen here. It will be trimmed flush once cured.

    equipment? Photovoltaic panels? Yes, we have designed roofs in which a forklift had to go between penthouses across the roof. Understanding how the roof will be used will help you immensely.

  2. Understand the construction process and how the roof might be used during construction. It is amazing how few architects know how a building is built and understand construction sequencing and the impact it can have on a roof. I firmly believe that architects think that after a lower roof is completed, that the masons, carpenters, glazers, sheet metal workers, welders, pipe fitters, and mechanical crews take time to fully protect the newly installed systems (often of minimal thickness and, here we go again, without a cover board — OMG) before working on them. I think not. Had the architect realized that temporary/vapor retarders could be installed as work surfaces, getting the building into the dry and allowing other trades to trash that rather than the finished roof, the roof system could be installed after those trades are off the roof.
  3. Coordinate with other disciplines. Roof systems cannot be designed in a vacuum. The architect needs to talk to and involve the structural, mechanical and plumbing engineers to ensure they realize the importance of essential details. For example, we cannot have steel angle around the drain whose flange rests on the bar joist, thus raising the roof deck surface at the roof drain. Ever wonder why you had ponding at the drain? Now you know. I attempt to always have a comprehensive, specific roofing detail on the structural, mechanical and plumbing sheets. I give the other disciplines my details and ask that they include them on their drawings, changing notes as required. That way, my 20-inch roof curb on the roof detail is a 20-inch curb on the mechanical sheets — not a standard 12-inch curb, which would more often than not be buried in insulation.
  4. Detail, detail, detail, and in case you glossed over this section, detail again. Make sure to include job-specific, clearly drawn details. Every condition of the roof should be detailed by the architect. Isn’t that what the client is paying for? Do not, as I once saw, indicate “RFO” on the drawings. Yes, that acronym stands for “Roofer Figure Out.” Apparently, the roofer did not figure it out. I enjoyed a nice Hawaiian vacation as a result of my work on that project, courtesy of the architect’s insurance company. How do you know that a condition works unless you design it and then draw it to scale?

    Figure 4: Insulation to curbs, roof edge and penetrations will not be tight, and to prevent a thermal short, the gaps created in construction need to filled with spray foam, as noted and shown here in this vent detail. Photos: Hutchinson Design Group

    I’ve seen roof insulation several inches above the roof edge because, OMG, the architect wanted gravel stop and forgot about camber. Not too big a deal (unless of course it’s a large building) to add several more layers of wood blocking and tapered edge strips at the now high wood blocking in the areas that were flush, but now the face of the roof edge sheet metal needs to increase. But what if the increase is above the allowable ANSI-SPRI ES1 standard and now a fascia and clip are required? You can see how the cost spirals, and the discussion ensues about who pays for what when there is a design error.

  5. Develop comprehensive specifications that indicate how the roof system components are to be installed. This requires empirical knowledge, the result of time on the roof observing construction. It is a very important educational tool that can prevent you, the designer, from looking like a fool.

Components

Best practices for single-ply membranes, in addition to the design elements above, also involve the system components. Below is a listing of items I feel embodies best practices for single-ply roof system components:

  1. Thicker membranes: The 45-mil membrane is insufficient for best practices, especially when one considers the thickness of the waterproofing over scrim on reinforced sheets. A 60-mil membrane is in my opinion the best practices minimum. Hear that? It’s the minimum. You are allowed to go to 75, 80 or 90 mils.
  2. Cover boards: A cover board should be specified in fully adhered and mechanically attached systems. (Ballasted systems should not incorporate a cover board.) Cover boards have enhanced adhesion of the membrane to the substrate over insulation facers and hold up better under wind load and hail. Cover boards also protect the insulation

    Photo 4: The greatest concern with the use of polyurethane adhesives is that the insulation board might not be not fully embedded into the adhesive. Weighting the boards at the corners and center with a minimum of 35 pounds for 10 minutes has proven to work well in achieving a solid bond.

    from physical damage and remain robust under foot traffic, while insulation tends to become crushed. Cover boards are dominated by the use of mat-faced modified gypsum products. Hydroscopic cover boards such as fiberboards are not recommended.

  3. Insulation: Now here is a product that designers seldom realize has many parts to be considered. First, let’s look at compression strength. If you are looking to best practices, 25 psi minimum is the way to go. The 18-psi insulation products with a fiber reinforced paper facer can be ruled out entirely, while 20 psi products are OK for ballasted systems. Now let’s look at facers. If you think about it for a second, when I say “paper-faced insulation,” you should first think “moisture absorbing” and secondly “mold growth.” Thus paper-faced products are not recommended to be incorporated if you are using best practices. You should be specifying the coated glass-faced products, which are resistant to moisture and mold resistant. A note to the manufacturers: get your acts together and be able to provide this product in a timely manner.

Additional considerations regarding insulation:

  • Insulation joints and gaps: You just can’t leave joints and gaps open. Show filling the open joints at the perimeter and curbs and around penetrations with spray foam in your details and specify this as well (see Photo 3 and Figure 4).
  • Mechanical attachment: Define the method of attachment and keep it simple. On typical projects, I commonly specify one mechanical fastener every 2 square feet over the entire roof (unless more fasteners are needed in the corners). Reducing the number of fasteners in the field compared to the perimeter can be confusing for contractors and the quality assurance observer, especially when the architect doesn’t define where that line is. The cost of the additional screws is nominal compared with the overall cost of the roof.
  • Polyurethane foam adhesive: Full cover spray foam or bead foam adhesive is taking over for asphalt, at least here in the Midwest, and I suspect in other local markets as well. The foam adhesive is great. It sticks to everything: cars, skylights, clerestories, your sunglasses. So, it is amazing how many insulation boards go down and don’t touch the foam. You must specify that the boards need to be set into place, walked on and then weighted in place until set. We specify five 35-pound weights (a 5-gallon pail filled with water works nicely), one at each corner and one in the middle for 10 minutes (see Photo 4). Yes, you need to be that specific.
  1. Photo 5: The design of exterior walls with metal studs that project above the roof deck is a multi-faceted, high-risk detail that is often poorly executed. Here you can see a gap between the deck and wall through which warm moist air will move and result in the premature failure of this roof. The sheathing on the wall cannot hold the horizontal base anchor screw, and the joints in the board allow air to pass to the base flashing, where is will condense. This is the type of architectural design that keeps on giving — giving me future work.

    Vapor/air barrier: A vapor air barrier can certainly serve more than a function as required for, say, over wet room conditions: pools, locker rooms, kitchens, gymnasiums. We incorporate them in both new construction and re-roofing as a means of addressing construction trade phasing and, for re-roofing, allowing time for the proper modification of existing elements such as roof edges, curbs, vents, drains, skylights and pipe curbs. Be sure to detail the penetrations and tie-ins with wall components.

  2. Deck type: Robust roof decks are best. Specify 80 ksi steel roof decks. Try staying away from joint spacing over 5 feet. Decks should be fully supported and extend completely to roof edges and curbs.
  3. Roof edge design: A key aesthetic concern, the termination point for the roof system, the first line of defense in regard to wind safety — the roof edge is all of these. The construction of the roof edge on typical commercial construction has changed drastically in the last 20 years, from brick and block to metal stud. Poorly designed metal stud parapets will be funding my grandkids’ college education. The challenge for the metal stud design is multifaceted: It must close off the chimney effect, prevent warm moist air from rising and condensing on the steel and wall substrate, create an acceptable substrate on the stud face in which to accept base anchor attachment, and — oh, yes — let’s not forget fire issues. Tread lightly here and create a “big stick” design (see Photo 5).
  4. Roof drains and curbs: As discussed above, there is a great need for coordination and specific detailing here. The rewards will be substantial in regard to quality and efficiency, minimizing time spent dealing with “what do we do now” scenarios.
  5. Slope: Design new structures with structural roof deck slope, then fine tune with tapered insulation.

Final Thoughts

Best practices will always be a balancing act between cost and quality. I believe in the mantra of “doing it right the first time.”

The industry has the material and contractors possess the skill. It’s the design and graphic communication arm that needs to improve to keep everyone working at the top of their game.

Designers, get out in the field and see the results of your details. See firsthand how a gypsum-based substrate board on a stud wall does not hold screws well; how a lap joint may not seal over the leading edge of tapered insulation; how the roof either ponds water at the roof drain or doesn’t meet code by drastically sumping; or how the hole cut in the roof membrane for the drain might be smaller than the drain bowl flange, thus restricting drainage. Seeing issues that the contractors deal with will help you as the designer in developing better details.

Contractors, when you see a detail that doesn’t work during the bidding, send in an RFI and not only ask a question, but take the time to inform the architect why you don’t think it will work. On a recent project here in Chicago, the architect omitted the vapor retarder over a pool. The contractor wrote an explicit explanation letter and RFI to the architect during bidding, and the architect replied, “install as designed.” In these situations, just walk away. For me, this is future work. A local contractor once told me, “I don’t get paid to RFI, I get paid to change order.” He also said, “If I ever received a response to an RFI, I would frame it!”

Manufacturers, too, can raise the bar. How about prohibiting loose base flashings at all times, and not allowing it when the salesman says the competition is allowing it. Have contractors on the cusp of quality? Decertify them. You don’t need the hassles. Owners don’t need the risk.

Seek out and welcome collaboration among contractors, roof systems designers, knowledgeable roof consultants, and engineers. Learning is a lifelong process, and the bar is changing every year. Too often we can be closed off and choose not to listen. At HDG, I am proud to say we have the building owners’ best interests at heart.

By all working together, the future of single-ply membranes can be enhanced and the systems will be retained when the next generation of roof cover arrives — and you know it will.