One More Regulation to Cut Into Our Real Estate Profits
ATTENTION ALL HOMEOWNERS, RENTERS, LANDLORDS, PROPERTY MANAGERS, REALTORS, BROKERS AND ANYONE WHO PERFORMS HOME RENOVATIONS AND REPAIRS FOR PROFIT.
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The Environmental Protection Agency (EPA) has changed its regulations for renovation, repair and painting (RRP) activities. Some of you may already know that as of April 22, 2010, all contractors and renovators must be trained and certified in the EPA’s new lead-based paint work practices in order to conduct RRP activities on pre-1978 housing and child occupied facilities.
Previously, anyone who owned a home built prior to 1978 could opt-out of the lead-based paint rules if no children under the age of 6 or pregnant women would be living in the home. Now, there is no longer an opt-out option. If you are renovating, repairing or painting (“RRP”) a home that was built prior to 1978, either the house or the components of the home that are being worked on must test lead free by a Certified Risk Assessor, Lead Inspector, or Certified Renovator, or the lead-based paint work practices outlined by the EPA safety must be followed and you must be certified. Failure to follow these new rules can result in a fine of up to $37,500 per incident of violation. This penalty can be charged as both a civil penalty for failure to comply and a criminal penalty. That’s a $75,000 per incident violation charge! Obviously, it is worth your while to comply rather than be found out. In addition, potential imprisonment for willfully or wantonly ignoring the requirements can be invoked.
Due to the influx of renovators and other workers requiring certification, the EPA has extended a grace period for those who have not yet obtained certification. The EPA will not enforce its rules against individual renovation workers if the person has applied to enroll in or has enrolled in a training course by September 30, 2010 and has completed the course by December 31, 2010. Firms will also not be fined for rule violations until October 1, 2010. However, to be clear, if you are already certified, the EPA can and will be issuing fines for violations.
Who is affected by this lead-based paint regulation change?
Anyone who performs RRP activities for profit is affected by the change in regulations. This includes property managers, people performing RRP activities to flip a home for profit, real estate agents doing repairs themselves, contractors and renovators. If you are a Do-It-Yourselfer who is not planning on turning a profit on the property then you are exempt from these regulations. However, the EPA does still advise to follow the safety precautions that they have outlines as lead-based paint dust is very harmful. Basically, if you are performing RRP activities that disturb more than 6 square feet of paint indoors and 20 square feet or paint outdoors, then you must be trained and certified by the EPA.
Maybe you have not performed any RRP activities nor are you ever planning to in the future, you may still be affect by this change in regulation. When selling, renting out, or leasing a home it is now a requirement to disclose any known information about lead-based paint and lead-based paint hazards. This means that if the space you are renting, leasing or selling has been tested for lead-based paint, the test results must be disclosed. If leasing out a pre-1978 property, a disclosure form about lead-based paint must be included in the lease. Sellers must also include a lead-based paint disclosure in the sales contract and buyers are allowed ten days to check for lead hazards.
What is "disturbing" paint?
The EPA considers any action that removes paint from its surface in an area that larger than 6 square feet indoors and 20 square feet outdoors to be disturbing the paint. This includes window replacement, weatherization, and component replacement in a home. Such actions such as scraping, open-flame burning or torching, sanding, grinding, using a needle gun, abrasive blasting and sandblasting are all activities that will disturb paint, and therefore require you to be certified and the EPA’s safety instructions to be followed. Surprising they didn’t include cleaning with TSP.
What are the EPA’s lead-safe work practices?
The work practices outlined by the EPA appear simple enough. One must (1) contain the area, (2) minimize dust and (3) clean up thoroughly when dealing with lead-based paint. There are, however, very specific ways in which to perform these actions so that the lead-based paint dust does not spread. In other words, when the government gets involved everything becomes complicated and expensive despite the sugar coating they try and put on their regulations. Unfortunately with the heavy fines and risk of legal action for not following the rules it is prudent that every investor be up on on this regulation.
For more information about the Lead based Paint Directive or how to become Lead-Safe Certified, visit the EPA’s website at www.epa.gov/lead.