Volume 48, Issue 3 - May 2009
In the News
Distributors Speak Out about Tax Credits
Many building products companies are taking steps to inform customers and consumers of the federal tax credits available if they sell or install energy-efficient doors and windows. With the recent passage of the American Recovery and Reinvestment Act of 2009, a tax credit is available for up to 30 percent of the door or window product, up to $1,500. To receive the tax credit, the door or window must achieve a .30 or lower U-factor and .30 or lower solar heat gain coefficient, which is more stringent than the current Energy Star® specifications. As not all door and window manufacturers offer products meeting these requirements, those that do have been busy promoting this message to customers and consumers. One such company is the Schield Family Brands, which includes Weather Shield Windows & Doors, Peachtree Doors and Windows, Visions Windows & Doors, Crestline Windows and Doors and Vetter Windows &
Brand manager Dave Koester points out that an extensive number of products and product lines from the Schield Family Brands readily qualify for the tax credit, including all-vinyl, vinyl-clad, fiberglass-clad, and even select aluminum-clad and wood windows.
“The .30/.30 criteria is stringent and difficult for many manufacturers to meet but the payoffs for individual homeowners and the country collectively will be significant in terms of energy savings,” Koester says.
Another company promoting its efficient products that qualify for the tax credit is Kolbe. The company says it offers numerous products to meet the requirements, including an online selection tool.
The online tool allows users to search and sort by glass coating, gas fill, product model, product name and product series. Vice president of sales and marketing Bob Kasten reminds users to “pay special attention to the sash and frame combinations along with the options that are shown.”He adds that to benefit from these tax credits, homeowners must maintain their own records that windows meet the qualification requirements. These records are to include receipts and the Manufacturer Certification Statement.
Some manufacturers, such as Simonton Windows, feel it may be difficult for consumers to determine which windows meet the criteria, so it has created the www.simonton.com/taxcredit information site. The site has a question-and-answer section, downloadable forms, case studies on energy-efficient windows and links to sites with additional information. Homeowners also may order literature from the site and gain more specific details on the tax credit program.
“We believe homeowners will be exceptionally impressed and pleased with the immediate return-on-investment they’ll see by installing highly energy-efficient windows,” says Mark Savan, president of Simonton Windows. “Energy bills are reduced instantly and the home becomes more comfortable. And now, homeowners can also gain up to a $1,500 tax credit for their investment.”
Manufacturers aren’t the only ones promoting the benefits of the tax credit; some distributors and dealers are as well. But are they seeing increased business due to the tax credits?John Posen of Arcadia Sash and Door in Arcadia, Calif., says his company hasn’t seen an increase in business yet.“One of the primary motivations for window replacement for the past few years has been energy efficiency,” Posen says. “In the past, when various rebates were offered only a very small number of customers took advantage.”
His company sells approximately 20 brands of products, but Posen says very few will apply to this credit. He is hopeful, however, his company could see some increased business.
“Since this credit is a significant dollar amount, more customers are interested in taking advantage of the opportunity,” Posen says. “But, and this is a serious obstacle, the .30 SHGC/30 U-Factor requirement severely limits the choices. I think most customers will not be interested in taking advantage of the credit because they do not want to compromise aesthetics just to save a few tax dollars and realize only a minor improvement in energy efficiency over the current Energy Star offerings that are widely available.”
John D. Swaffer is advertising manager at Keim Lumber Co. and he commented on the tax credits (but noted that it is his point of view and not necessarily that of his company).
“As I understand it, in regards to the window industry the ‘stimulus’ does nothing to improve the economy. In order to qualify for the stimulus, the homeowner has to spend more to meet the increased requirements that qualify for the tax incentive. In other words, the window that used to cost $X and met Energy Star qualifications no longer qualifies.
Now he has to spend $X+$Y dollars to get the window that qualifies. He does get $Y tax credit but is no better off than before,” Swaffer says. “Since he couldn’t afford $X before, he still doesn’t buy. The government’s help amounts to $0 for the consumer. Actually it amounts to $-Y because the consumer will end up paying for it in tax dollars.”
Shane Wake, territory sales for Innovative Window & Door in Blair, Neb., distributes Integrity Windows & Doors and says he is getting more inquiries from customers.
Wake has been promoting the company’s products at several home shows throughout Nebraska, Kansas and Iowa and says there has been increased interest from homeowners. “People attending the most recent home shows made it a priority to check the product’s ability to comply with the tax credit,” he says. “We are promoting our product’s U and SHGC values with the tax credit information to our dealers and to the end consumer.”
An Adverse Effect
Jim Redcliff from Chapman Windows and Doors in West Chester, Pa., a distributor of a variety of different window lines, says that while his business has been adversely affected by the country’s financial crisis, the tax incentive in the Recovery Act is a blessing.
“But Congress chose to ignore the long standing Energy Star ratings and come up with their own. We are laying off people to stay in business. Thanks for the help.”
Redcliff says the spring season is usually his company’s busiest time of year.
“Most of our wood products are in the .31 to .33 range and do not qualify for the credit. Is this making sense to anyone? A quick reversal of the .30 standard is required. Go back to Energy Star immediately and set future dates for companies to reach the .30 level.”
The members of the Window and Door Manufacturers Association (WDMA) are trying to help companies like Redcliff’s. The association has launched a campaign to amend language used in the recently passed American Recovery and Reinvestment Act of 2009 (ARRA) regarding consumer incentives for energy-efficient doors, windows and skylights.
“There is a section of ARRA that ties the eligibility of tax credits for energy efficient windows, doors and skylights to arbitrary standards of 0.3 U-factor and 0.3 solar heat gain coefficient (SHGC) rather than the established Energy Star standards. This standard is likely to create confusion in the market for both retailers and consumers, and will severely limit—and in some cases eliminate—many energy efficient products from qualifying for the tax credit that are now readily identifiable,” says WDMA president John Stoiber.
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