And the first bill is here...

The election is over, and even though the session has not begun, the bills are being filed. So far only a single bill affects landlords: HB 1050, an act to promote energy efficiency. And the bill is not bad to us at all.

The bill's purpose is to promote energy efficiency by allowing the utility companies to finance improvements to the property, and collecting payments through a metering charge. The bill is not simple; and at 10 pages it takes a little while to go through. But the bottom line is that it is clean and I think it is an interesting idea.

The bill has sufficient language to protect landlords from bad tenants signing up for home improvements. And the bill does not allow the utility company to file a lien on the property (although subsequent purchasers will have to assume the liability.) Landlords must give some notices to subsequent tenants, but the notice seems to be "common sense" and not a burden to us.

I hope this bill can be the start of a new direction in energy legislation for Arkansas. Speaking as a homeowner, I would LOVE to improve the energy efficiency of my own home. But the costs of these improvements are too high to make casually. As an example, earlier this year I thought about adding some solar panels to my home. After researching my annual utility bills, I calculated that adding enough solar cells to my house to pay for 50% of my electricity would take 22 years to break even. So as a result, I do not have solar cells.

As a landlord, the federal energy tax credit has irritated me... as a landlord I didn't get any kind of tax credit for improved efficiency HVAC or e-glass windows, etc. And as every landlord knows, energy efficient windows are not cheap... so if I am forced to depreciate the windows over several years, why bother? Landlords cannot simply spend money; it has to make a return, or that landlord will not be a landlord for very long. Our lower income tenants could really use the money from utility savings, yet the government has done little to encourage landlords to make the necessary investment.

If Arkansas really wants to start saving energy, this bill is a good place to start from. But I would encourage our legislature to expand their scope: let's look at tax credits for homeowners and depreciation expansion for landlords... let's REALLY make it advantageous to improve our homes.