AHRI v. City of Albuquerque
August 8, 2009
AHRI v. City of Albuquerque
In January 2008, Alburquerque implemented a new green building code that included energy efficiency requirements for air conditioners, furnaces, heat pumps and water heaters that were more stringent than U.S. Department of Energy requirements. The legislation prompted a group of heating, ventilation and air conditioning and water heating equipment trade organizations, contractors and distributors to sue the City to stop the new requirements from taking effect on the grounds that the federal Energy Policy and Conservation Act of 1975, National Appliance Energy Conservation Act and other federal laws preempt the City’s new building code provisions related to energy efficiency and the City did not have a waiver of preemption from the federal government.
Specifically, Plaintiffs argued that they would be harmed by the new legislation because sorting through conflicting standards will cause confusion and complying with conflicting standards will increase equipment costs causing consumers to repair rather than replace equipment and driving up the cost of new homes and other projects.
As a general matter, it is well-established that a federal law that conflicts with a state law will “preempt” the state law if Congress intended, either expressly or implicitly, to preempt the state law. Absent Congress expressly stating its intent to preempt, Courts will infer the intent to preempt if the federal law conflicts with state or local law or if the state or local law is an obstacle to the execution of the federal law (conflict preemption) or if the federal regulatory scheme is so pervasive as to “occupy the field” in that area of law (field preemption). Absent demonstration of a compelling interest or a federal waiver of preemption, local or state laws preempted by federal laws have no effect.
Judge Martha Vazquez of the United States District Court for the District of New Mexico granted Plaintiffs a preliminary injunction barring the enforcement of the new green building code pending the outcome of the lawsuit. Judge Vazquez acknowledged that the City’s objectives were “laudable,” but ”unfortunately, the drafters of the code were unaware of the long-standing federal statutes governing the energy efficiency of certain HVAC and water heating products and expressly preempting state regulation of these products when the code was drafted and, as a result, the code, as enacted, infringes on an area preempted by federal law.”
Although in this instance Congress stated expressly its intent to preempt state and local law, this case may prove significant if it portends a precedent pursuant to which local energy efficiency and high performance building regulations are challenged more often and more aggressively as federal regulatory activity increases. Federal tax incentives and building programs now actively encourage green building and President Obama has pledged to increase federal regulation of high performance buildings. The lack of federal regulatory action under previous administrations prompted numerous state and local government initiatives intended to increase building energy efficiency and performance. These local requirements will have no effect, however, if Congress intends, either expressly or implicitly, to preempt the field of energy efficiency in particular or green building generally.
A uniform federal standard is one answer, but it will prove difficult to create a uniform national standard that can adequately address environments as diverse as those found between San Diego and Boston or between Anchorage and Miami or in Las Vegas and Buffalo. Moreover, the comprises that are necessary to gain the cooperation of national constituencies will almost assuredly result in a uniform federal standard that is lower than the standards acheived (or achievable) by local regulation in many if not most communities.
Absent careful analysis of the potential conflicts between local, state and federal regulatory action related to green building and energy efficiency, expect more active opposition and legal challenges to state and local green building requirements.
General recognition goes to Stephen Del Percio and Shari Shapiro, among others, for their previous discussions of this case and the issues it raises. For their comments, please go to http://www.greenrealestatelaw.com/ (Stephen Del Percio) and www.greenbuildinglawblog.com (Shari Shapiro).