It’s hard to promote the environmentally friendly buildings, which usually requires extra design work and more importantly, expense to ensure energy conservation. Nevada officials thought the promotion is hard too. So tax breaks are used to encourage companies to develop “green” architectures. The state offers property taxes cut up to 50% and a 2% sales tax cut for the building supplies used in the “green” construction. This sounds like a win-win situation for both the for-profit developers and for-a-great-cause state government. However, the tax incentive the government offered was so alluring, many more commercial developers applied than anticipated. Now Nevada is out $974 million over the next ten years for the several already approved constructions, while the state previously only expected just a quarter million tax cut altogether. The state authority rushed to stop the program and amend its original tax reimbursement plans to cut the total tab by half.
Never underestimate the power of money.
Also noted: recently, former US president Bill Clinton proposed the Clinton Climate Initiative, which coalesces city mayors, large banks, landlords and building developers to promote the “green building” concept to fight the much talked global warming. His initiative focuses on financial incentives instead to policies to push environmentally friendly building upgrades. The five banks will provide up to $1 billion each in loans to the cities or private landlords to upgrade energy-hungry heating, cooling and lighting systems in older buildings. The saving from utilities bills, usually 20% to 50% of the original expenses, will be used to pay back the loans and interests. Sounds like a nice idea to me.