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Coordinating Council Working Groups

Three meetings were held in 1998 of the PATH Coordinating Council. Approximately 60 people attended these meetings in Washington, DC to learn what the program planned to accomplish in the coming year. Since the meeting in November 1998, there has been support expressed from the building industry participants (builders, remodelers, and manufacturers) and the federal agencies to split the Coordinating Council into working groups that can address specific issues vital to the programís success. We will dispense for now with day-long meetings in Washington of the full Coordinating Council. Five topics have been selected as working group subject areas. They are: technology roadmapping, finance, barriers/insurance, quality and labor issues, and consumer education and expectations.

Management of the Working Groups
The working groups will be co-chaired by industry and federal representatives. The agenda for each of the first working group meetings will be set by the industry and agency leads; subsequent meeting agendas will be set by the participants in the task groups. Most meetings will take place by conference call on a bi-weekly or monthly basis as determined by each of the working groups. Occasional face-to-face meetings may be scheduled.

The purpose of the working groups is to identify key issues that need to be resolved in order accelerate the successful achievement of PATH program goals. The working groups will discuss issues relating to the PATH FY99 Operating Plan and the Action Plan that is currently under development. Proposed working groups are described below:

Finance
One of the challenges confronting the introduction of new technologies is that they often cost more at product introduction than the products they compete with. This means that introduction often occurs at the upper end of the housing market. The result is that those who most need the advantages of lower operating, maintenance and repair costs offered by new technologies are least able to afford them. Even without increased first costs, some families need help with down payments. How can PATH create financing incentives that will enable the introduction of innovative technologies across the full spectrum of housing, including especially low and moderate income housing where the value created by the technology will be recognized? Routine underwriting practices that provide higher income to debt ratios for PATH houses will help more households purchase such homes. How can the lower insurance, operating, and maintenance costs of PATH homes be taken into account in underwriting home purchase or rehabilitation loans? How can the value of PATH technologies be accurately reflected in appraisals? This task group will investigate innovative approaches toward financing advanced housing technology.

Technology Roadmapping
The PATH goals set an ambitiously high standard for housing performance by the year 2010. Not only do we expect to make homes more energy and environmentally efficient, more durable, and disaster resistant, but we also expect them to cost less to own and operate. Technology roadmapping will enable the residential building industry and the agencies whose missions relate to the industry to identify pressing needs for technology development. Some of this work has already been done through the three year process that led to the publication of the report, Building Better Homes at Lower Costs: The Industry Implementation Plan for the Residential National Construction Goals. Other sources of useful information are the 15,000 calls on problems and technical issues in housing that have been logged into the toolbase Hotline database as well as responses to the NAHB Research Centerís Annual Consumer Practices survey which compiles information on repair and remodeling practices. What is lacking, however, is a formal roadmapping process that establishes technology priorities that will guide funding and R&D decisions. This working group will create a technology roadmap for the PATH program on technologies needed to help achieve the PATH goals.

Barriers/Insurance
One of the major barriers to the introduction of new and innovative products into the home building industry is the fear of liability from the failure of the product. Home building presents some unique circumstances which justify developing a special program to address this issue. There is a need for a program that will permit buildersí insurance companies to fully cover all risk inherent in the deployment of new technologies at a reasonable rate to the builder; and, a program that will reassure builders that the manufacturer will be there to honor the warranty. Another insurance issue is property insurance. Many PATH technologies can reduce risks of damage under natural disasters. How can the insurance industry factor in these technologies in setting rates and provide incentives for PATH technologies?

Quality and Labor Issues
Methods of quality improvement have dramatically changed the way in which many construction companies conduct their business in recent years. Borrowing from the successful introduction of quality concepts in other industries, residential construction companies are providing better value to their customers and improving their net income in the process. The residential industry now has two awards which recognize company efforts to deliver highest levels of quality. They are the National Housing Quality Award and the National Remodeling Quality Award modeled after the prestigious Malcolm Baldrige Award. How can PATH take the message of the successes of these few award winning firms to the broader context of the 60,000 firms who are building and remodeling the nationís housing? At the same time the housing industry is facing a crisis in the availability of skilled labor to deliver a quality product. This task group will address programs of skills development and on-the-job training that will enable the work force to accept innovative technologies and install them correctly.

Consumer Education and Expectations
Builders often state that they would be more willing to incorporate innovative technologies into their houses or remodeling projects if their customers ask for them. The industry spends billions of dollars annually trying to deliver their messages to consumers. Consumer awareness about new technologies is often influenced by the messages delivered through product advertising. Consumers often donít understand the full costs of a new product or its performance when installed in a house. The PATH program will be developing a comprehensive set of technical information on the performance and expected costs of new technologies. PATH is not trying to sell products to consumers; instead, it will be focusing on raising consumer awareness of technologies that can deliver higher performing houses that are less expensive to own and operate. This task group will explore ways in which the government and industry can deliver the messages of PATH to the consumer and help them understand how to ask for PATH technologies.


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