Red tape and white papers: laws and regs transform property management.

One interesting sideeffect of the protracted recession through which we are passing (like watermelons through a straw, one might add) is the lack of distractions for building departments, planning boards, and other regulatory bodies. Many developers and building owners inform BUILDINGS Magazine

One source from Ohio, who prefers anonymity, complains: "Our local planning board is throwing obstacles in our path." From Delaware, a friend laments of environmental regulations "that are adding tremendously to our costs of doing business." A property manager from Atlanta with a sizeable national portfolio relates: "Building departments are actually finding the time to go back and inspect buildings. And when you submit for any permitting, it can open the door for other inspections. Regulatory issues are probably the biggest issues for us."

Are building owners nationwide paranoid? If so, then justifiably. Consider: Connecticut's Supreme Court has found property owners liable for environmental damages incurred by previous owners; in Texas, Environmental Protection Agency (EPA) inspectors are conducting surprise investigations of HVAC refrigerant recovery for compliance with Section 608 of the Clean Air Act (CAA); and across the country, the Occupational Safety and Health Administration (OSHA) is trying to disclose results of indoor air testing.

Collectively known as "non-economic factors," the paperwork and time required to jump through legal and regulatory hoops have become considerable stumbling blocks for project starts and upgrades.

"Many owners are unaware of the important laws and regulations," observes James C. Dinegar, vice president of Government Affairs at the Building Owners and Managers Association (BOMA) International in Washington, D.C., "but most are simply overwhelmed by the sheer volume of information." Even so, says Dinegar, competitive building operations hinge on successfully handling non-economic issues on a regular basis.

The truly consequential, non-economic items for 1994 are pretty much the same ones that have affected the industry lately. Among them are sweeping legal and social acts, including the Americans with Disabilities Act (ADA), the Community Reinvestment Act, Wetlands legislation, the National Energy Policy Act (NEPA), and the CAA -- which will affect both HVAC operations and rush-hour commutes. Also critical for ownership and financing are the 1993 Tax Bill real estate provisions.

Potential pitfalls for 1994 are many. Managers and owners should be familiar with: certification procedures for HVAC technicians; regulations for the treatment and disposal of hazardous wastes; the American Society for Testing and Materials' (ASTM) two new standards for environmental audits and due diligence; and standards from the American Society of Heating, Refrigeration and Air-Conditioning Engineers (ASHRAE) for maintaining good indoor air quality (in fact, owners should brace for federal and local legislation on IAQ, says Dinegar).

An even better understanding is advisable regarding: EPA final rules for venting and recycling/reclaiming refrigerants; energy efficiency standards set forth in NEPA; and local initiatives concerning lead, asbestos, and other health hazards. For owners, it's time to sharpen pencils and crunch numbers. The 1993 tax bill provisions include new, more favorable treatments for passive losses; investment by pension funds; recovery periods for commercial property depreciation; and the discharge of real property indebtedness. Dinegar points out one "big hit" in the tax bill, however, which involves the treatment of leasehold improvements. For facilities managers, it's time to plan and act. If it hasn't happened yet, make sure to file a statement with the EPA for recovery and recycling equipment (it was due August 14th, 1993), and study the new venting rules. Clear, accessible records of refrigerants purchased and added are vital.

Public phones in all buildings should comply with the Hearing Aid Compatibility Act of 1991, which will attract more scrutiny as the ADA is enforced. Owners can obtain an ADA Checklist from the Access Board, the responsible federal agency, to help keep moving on compliance plans. "Detectable warnings" for visually and hearing impaired occupants are ADA essentials and vital for avoiding liability. Toxic hazards on properties are another liability issue. Some states, like Minnesota and California, have strict guidelines for the disposal of fluorescent lamps, which contain mercury. Building managers ought to regularly review changes in OSHA standards, such as the recent one concerning bloodborne pathogens in healthcare and other facilities. Good tenant relations and service are also important for avoiding IAQ and ADA litigation and other lawsuits. Legislation and regulations in the near term can be addressed early for strategic -- and competitive -- advantage. For example, the FCC has given state utilities commissions the ability to transfer responsibility for maintaining riser cable wiring to the building owner, in some circumstances. Several states have taken that action and others are expected to. Phone companies have traditionally been responsible, so it could be useful to double-check present maintenance and serviceability. The Historic Rehabilitation Tax Credit Expansion Act may soon give new pecuniary incentives for some modernizations. Also to come, according to sources on Capitol Hill, are an energy tax (say it ain't so) and a uniform federal ban on smoking (cough). Energy efficiency -- and nicotine patches -- are definitely in the future. Whenever possible, owners and managers should participate in local politics and building code reviews, and voice their concerns to the appropriate government representatives on issues that affect buildings. The associations "minding the store in Washington" deserve support in their efforts, as well.

It's also important to remember that nobody is immune to the laws and regulations. "For both users and developers in both residential and commercial properties, you just have to wade through the administrative swamps," exhorts Theodore B. Austin, vice president of Commercial Properties for James River Inc., Richmond, VA.

And watch out for the alligators.