In the summer of 2002, the Vermont Offender Work Program Board (VOWP) issued a scope of work for a feasibility analysis to determine the most appropriate role for offenders in custody to assist in relieving the shortage of safe, decent and affordable housing. VOWP was particularly concerned that any new program provides educational development and workforce training without having an adverse impact on private sector enterprises. The results of the study would be used to assist VOWP in advising the Commissioner of Corrections on whether or not to pursue a Department of Corrections (DOC) sponsored affordable housing rehabilitation/ construction program. Sleeping Lion Associates was engaged to perform this analysis. Nancy Wasserman and Jeff Staudinger performed the work.
VOWP outlined nine specific questions for the analysis to answer. These were:
- 1. What is the most appropriate housing need that a VOWP Housing Project should address?
- Is the program able to be implemented?
- What are the resources needed for start-up? Resources for ongoing operations?
- What, if any, are the likely impacts of each option on the private and nonprofit sector?
- What are the most likely partnerships with the public, for-profit and nonprofit sectors?
- Are there geographic concerns due to housing needs or labor pool of inmates?
- What is the appropriate scale of a VOWP Housing Project?
- List of contacts made during the project
- Analysis of the feedback received from stakeholders regarding the concept of a VOWP Housing Project
In order to answer the questions outlined by VOWP, the consultants reviewed existing information and interviewed key players and potential partners in the affordable housing field. Data examined included descriptions of similar programs in other states, workforce development needs faced by
’s construction industry and
affordable housing cost data. Phone or face-to-face interviews were conducted with 29 people from 25 organizations 14 nonprofit housing groups developers, funders, or energy efficiency experts, eight private sector housing professionals and three organizations involved in training programs that focus on housing or construction.
Initial findings from the interviews were conveyed to the VOWP Board and Department of Corrections staff involved in and concerned about offender work programs. The VOWP Board then identified and prioritized five options requiring further consideration. These options are outline below. Our assessment of their viability reflects information from additional conversations with private and nonprofit affordable housing developers and training organizations, review of earlier studies and an examination of the issues and costs related to the construction of panelized walls, trusses and solar panels.
A Primer on Affordable Housing in
The idea of “safe, decent and affordable housing” means different things to people depending on their incomes and abilities. Within the State of
, there has been considerable attention paid and funding directed toward creating and preserving affordable housing. Housing advocates around the state often cite the definition of affordable housing used by the City of
. It encompasses the four ‘Ps’:
- Preservation of existing housing stock
- Production of new housing
- Protection of vulnerable populations such as elders, people with disabilities and those with very low incomes
- Promotion of home ownership
The State of
’s support of affordable housing is heavily guided by the Comprehensive Housing Affordability Strategy (CHAS) and the annually published Consolidated Plan. Both documents are produced by the Department of Housing and Community Affairs. They are a prerequisite to securing federal funds for housing. Public funding for the creation or preservation of housing comes from a number of US Department of Housing and Urban Development (HUD) programs. These include Community Development Block Grants (CDBG), which are available to municipalities and administered by the State for all regions except the City of
; and HOME, which is administered by the Vermont Housing and Conservation Board (VHCB). The City of
receives its own allocation of each of these funds. HUD Section 8 funds provide rental subsidies for eligible low-income households. State funds for affordable housing are made available by VHCB. Private investors support housing through use of the Low Income Housing Tax Credit (LIHTC), which helps create affordable rental housing, and investment in the bonds of the Vermont Housing Finance Agency (VHFA) which are used to provide mortgages for single- and multi-family housing,
The vast majority of housing that is assisted with public funds are rentals. In any given year, publicly supported housing will be 50-60% rehab while 40-50% are new. Publicly funded projects often must satisfy multiple social goals. They provide affordable housing, and meet one or more goals including historic preservation, downtown renewal, social service-enhancement, and various health or access requirements (e.g. lead removal, accessibility.) Projects are generally sponsored by local nonprofits. Housing
, a statewide nonprofit, works in partnership with these organizations to develop projects that make use of the LIHTC. A limited number of new affordable single family homes are being built by Habitat groups, vocational programs, or training programs like YouthBuild and WomenBuild.
The state is home to six NeighborWorks® Homeownership Centers housed at nonprofit housing development companies. These centers provide homebuyer education, credit and budget counseling, financial assistance, home maintenance education and assistance with rehab planning and financing. The Homeownership Centers help potential buyers prepare for homeownership and then find and finance a home. They do not undertake single-family home development.
s most affordable single-family homes are generally:
- Mobile homes in parks and on owned land;
- Owner-builder homes and/or “handyperson specials”;
- Snyder Corporation (and similar) single-family developments where the company is absorbing all or a portion of its overhead expenses on a pre-determined number of “affordable” units.
In 2002, new “affordable” units cost an average of just under $130,000/unit to build. About $90,000 of that amount is construction cost. The remaining costs are for land acquisition, soft costs and development fees.
Construction costs have risen significantly over the past few years due to a number of factors:
- The healthy economy of the late 90’s led to lots of demand. Quality professionals could pick their jobs. As of late 2002, this situation has changed for carpenters but not for the skilled trades (electrical & plumbing) working on residential properties.
- Regulatory and funding requirements around labor (worker’s comp, insurance) and materials (stricter specs responding to liability concerns.)
- Land acquisition costs have risen with the economy.
- Permitting cost rises with the time it takes to get through the process. This has increased costs for any project where neighbors raise concerns.
Feedback and Findings
Offenders are already involved in relieving the shortage of safe, decent and affordable housing in a variety of locations around the state. This includes: work by the St. Johnsbury work camp involving demolition, securing work sites and some sheet rocking and painting; work crews at various locations assisting on discretely defined projects; and a limited amount of cabinet construction by the Vermont Correctional Industries (VCI) shop in
These encounters have provided both private and nonprofit housing developers with an understanding of what is and is not effective in regards to the use of offender labor. Both types of developers were relatively forthcoming about their successes and concerns. Smaller contractors contacted about this feasibility study did not return our phone calls indicating a lack of interest in providing feedback and possibly participation.
- Situations where Corrections is able to deliver a finished service or product and there are no management requirements expected from the housing developer. For example, contracting for demolition of a building or purchasing products from the VCI cabinet shop.
- Use of a crew or work camp for a task that is easy to separate out from the total project as a discrete scope of work e.g. demolition, securing a property, removing clutter, ripping out carpets, installing insulation board, hanging sheetrock or painting. The object is to advance the project is a cost-effective way while keeping the crew out of the way of the general contractor.
- Work camp tends to include men with greater skills. While in the facility they are often at their best they are clean, sober, getting rest, food, away from temptation, etc. In some instances these skilled offenders will train a helper offender to offender. These workers also have a significant incentive to perform: each day of work counts towards two days of time served.
- A critical component for successful encounters are DOC supervisors who know their crews, are skilled about organizing them and who want to make the experience work. Developers consistently indicated that that they have no interest in contracting with DOC crews that do not have supervisors with these attributes.
- The private sector perceives the cabinet shop to be a good way for offenders to learn a skill without the need for on-site supervision.
What does not work
- Nonprofit developers appreciate the cheaper labor but not if they have to offset it with greater management and oversight costs. They consistently avoid work crew situations that require too much management.
- Scheduling with DOC is not ideal. Users are often unable to obtain a consistent crew over regular hours or days due to court dates, rehab programs, and the need to limit DOC employees to an 8-hour day. This often means that offenders are available for only 4-5 hours of productive work time. Developers would prefer getting a longer (perhaps 8-hour?) day out of a crew. A few asked if DOC would consider a 4-day workweek for supervisors in order to deliver this longer work period.
- Using offenders in occupied buildings.
- VCI pricing. Furniture is nice but expensive it needs to be quality and price competitive. Pricing on production of kitchen cabinets is not yet cost effective vs. Tri-Pack. Also, one contractor noted a lack of flexibility at VCI… design details required flexibility, was told, “We do what we do…”
- VOWP labor is now priced per job. If it were priced as a program (i.e. such and such a cost per hour for these jobs), it might be used more.
Our discussions with housing developers elicited a number of concerns about a VOWP Housing Project. While there was widespread support for offender training and development, developers were concerned about the potential for competition. There was an almost universal reluctance to use offenders in occupied housing and a desire to keep offenders off certain work sites if they had committed specific offenses. Other comments indicated the requirements developers would expect from an offender work crew.
Working with Offenders
- Lots of developers questioned the focus on housing. “I would not put them in the neighborhoods where we work, even if the units are vacant. Often the community knows the offender, know what happened, and may even be related.” “We would not want them working in occupied buildings.” “No interior work.”
- Construction sites are uncontrolled environments with lots of temptation and the opportunity to pursue it…
- Developers cautioned us away from using offenders in any kind of hazardous material abatement program including lead.
Balancing Training vs. Competition
- The construction industry is facing a labor shortage throughout the country. When contractors are busy (which they were through 2001), the industry struggles to find labor. Developers know that many of their current employees may have done time and are committed to helping offenders transition back into productive members of the community. “I’m not looking for free help I’d give someone a chance if they had the right attitude.”
- Contractors do not want offenders to be in direct competition. “My tax dollars paying so you can compete against me? I don’t think so.”
- One developer indicated that he would be hesitant to use anyone on an existing framing crew “too hard with in-flow of different people; supervision and discipline would be difficult.”
- The private sector is not willing to accept liability for actions or behavior of VOWP labor on job sites. Offenses need to be known and tolerable. Contractors must have the ability to say no e.g. no one w/ sex offender records on college campus jobs. “I cannot afford to have my reputation impaired.”
- Concerns were also expressed about the developer’s potential liability in regards to the safety of equipment and materials on site as well as the potential for sabotage in a finished building.
- Developers needed to be reassured that they would not absorb additional workers compensation expenses.
- The private sector would welcome any type of legitimate program that can provide some sort of guarantee/assurance that the person will show up on time and be ready to work.
- Developers who have used the St. Johnsbury work camp noted the success of occasional offender to - offender training and wondered if this could be replicated.
- Everyone involved in training noted the need for building offender skills in reading, math, basics of safety and communication and the importance of follow-up placement and support.
- A number of interviewees suggested the importance of both practical and life skills training beginning months before an offender’s release date.
- A number of people noted that training and life skills development might be more effective when delivered by an entity that is not seen as “The State” or “The Law.”
- There was a strong interest expressed in partnering to teach skills from all of the training and specialty nonprofits with whom we spoke. This includes Associated General Contractors, Efficiency Vermont, International Brotherhood of Electrical Workers, Vermont Youth Conservation Corps (VYCC), WomenBuild and YouthBuild. In all cases, the partners would need some compensation.
Options Outlined by VOWP
Offender Work Program determined that the following options warranted further consideration in regards to the potential for implementation. The options are listed in priority order, as determined by VOWP:
- Build and sell completed homes
- Add a crew that functions like the St. Johnsbury work camp - ideally in
- Build and sell cabinets
- Restore historic windows
- Build and sell panels/trusses
A sixth option - build solar panels was added as a result of informal discussions with Renewable Energy
Build and Sell Completed Homes
The on-site building of completed homes is a model that has been successfully used by the state’s vocational schools, WomenBuild, YouthBuild and Habitat for Humanity groups. In most instances a suitable building lot is secured, arrangements are made with subcontractors for site preparation and then a crew of volunteers or student/trainee participants proceeds to construct a home under the guidance of one or more skilled carpentry instructors. Habitat pre-selects a buyer who commits to assisting with construction while the other programs generally sell the home at completion. In many instances, the land is owned by a regional community land trust thereby enhancing the home’s initial and perpetual affordability.
Off-site construction of modular homes by trainees has not been tried extensively in
is the only training environment in the State building modular homes of which we are aware. Prison industry programs in both
are currently producing modular housing. The
program, which currently produces 100-125 units per year, is marketed primarily to Native American Tribes and the State Housing Finance Agency.
builds its units to order for a nonprofit housing organization formed by the Homebuilders Association of Lincoln (
is home to at least one manufacturer of modular homes. Annual construction rates by VCI of 2 to 4 units of housing would not have an adverse impact on these manufacturers. Rates at this level would also encourage set-up and perhaps offender placement assistance from the private sector. A more aggressive construction program could damage this potential partnership. Limiting home sales to otherwise ineligible homebuyers could enhance appreciation of the program by both the public at large and members of the construction industry.
’s strongest nonprofit housing developers also operate homeownership centers. We spoke with the staff of five of the six centers or their sponsors. Most had no interest in finding appropriate sites for completed homes. They cited the amount of time required for creation of a single unit as well as the cost of land and preparing the infrastructure. Each would require compensation for the time spent developing the unit and all indicated a belief that “the bang for the buck was terrible.” Three indicated that the need for new affordable housing was much greater in the multifamily rental arena than single-family homes. They noted that the most affordable single family housing available is frequently existing older housing stock rather than new construction. For-profit developers did not return calls seeking their reactions to the concept. Despite the general lack of interest, there were two areas that might offer partnership potential with DOC. Each is described below.
Stick-Built Mobile Home Replacements
The nonprofit developer community would welcome the construction of stick-built homes that can be used as mobile home replacements. Gilman Housing Trust (GHT) currently has a partnership with at least one vocational program to build on-site mobile home replacements. GHT-provided plans detail the requirements for the 14’x 72’ two-bedroom, two-bath handicapped accessible, five-star energy rated homes. GHT arranges for the foundation to be poured and the students build the home. The total cost of each home averages about $60,000, which includes a $4,500 development fee, the cost of the foundation, all materials and a nominal contribution toward student transportation expenses. Subsidies from VHCB help to further lower the cost of the home for income-eligible buyers. If GHT were to work with VOWP, the cost of the home installed on the site would need to be approximately $44,500 . GHT would be interested in working with DOC to develop a workable arrangement to have a finished home delivered and then installed on the new foundation. Demand would be approximately two to four units per year. Once established with GHT, similar relationships might develop elsewhere.
Section 8 Home Buyers
A relatively new aspect of the federal Section 8 Housing Choice Voucher program allows eligible low-income families seeking to buy their first home the opportunity to use the Voucher to pay for a mortgage and other housing expenses. The Vermont State Housing Authority (VSHA) administers this program for the State. VSHA has been a national leader in making use of this program. In just two years of operation, the program has been used by 26 families around the state. Of this number, two families bought or acquired land and then purchased a modular or mobile home one in the
and one in
. VSHA would welcome the opportunity to partner with a builder or developer who could help create affordable, energy-efficient and accessible units for purchase by participants in this program.
We have assumed that construction could occur in the
facility using existing equipment and staffing. Additional expenses would include the use of a vehicle to transport finished homes to the site and the cost of installing the home on the foundation. At inception, there would be additional costs related to developing the partnerships and identifying roles and responsibilities. Once the program is established, soliciting and pricing jobs would be the responsibility of whoever currently does this for the cabinet shop.
Add a Chittenden County ‘Work Camp’
There is significant demand for a skilled work camp like crew in the Chittenden County area. The willingness to contract with an offender crew will be contingent upon cost, capacity and performance history. A critical operational decision for DOC is whether the program will use incarcerated offenders or those who are not institutionalized. This decision will impact staffing, cost, the types and locations of projects undertaken, public perceptions and the impact on private sector companies.
Nonprofit housing groups, affordable housing advocates and others familiar with the range of housing needs identified potential projects for this crew. They include:
Minimal or No Cost
- Working with disabled households to help out with outdoor maintenance e.g. raking leaves, stacking wood, shoveling snow, staining ramps.
- Paint spraying crew for free paint (i.e. income eligible) recipients in
- Demolition for nonprofit housing developers.
Competitive pricing opportunities
- Turnover crew for rental apartments - cleaning, painting and minor repairs. Need tends to be up to 10/month.
- Seasonal turnover grounds maintenance and landscaping crew i.e. once or twice a year jobs like mulching and spring planting as opposed to weekly jobs like mowing.
- In the City of
, develop a team that can work with owners of vacant properties on upgrading and refurbishing. The City would be a willing partner but would need time to put it together. This could raise competition concerns.
- Rehab Crew able to do small and large repairs on properties. Must be professional and well managed.
- Renewable finishes crew install and paint siding, painting, install flooring
- Framing crew that is up for hire
WomenBuild, YouthBuild and the Vermont Youth Conservation Corps (VYCC) all have experience operating free-standing programs that use project construction as a vehicle to train people in practical and life skills. WomenBuild is motivated to help women acquire the skills needed to compete in the trades and technical arenas; YouthBuild focuses on high-risk, low-income young adults and seeks to provide programs that “enable young people to assume leadership in order to rebuild their communities and lead responsible lives;” and VYCC seeks to “teach young people to take personal responsibility for all of their actions.” All three programs have experience working with offenders. The Directors of each of the programs were quite candid about their operations, lessons learned and offering their opinions about the ease of implementing similar programs with offenders. All three would welcome the opportunity to explore additional partnerships with DOC.
The following chart reflects the varied focus and operational approaches of these three programs:
VYCC WomenBuild YouthBuild
“Typical” project High-priority conservation and park management projects on public lands in Vermont Rehab or new construction projects primarily in Chittenden County area Jobs for Burlington CLT and Lake Champlain Housing. Partner with Recycle North, Habitat, Intervale and others. Also community clean-up
Crew Size Trainees and instructors 8-10 on crew with 2 leaders 4 on crew with 1 instructor 7-10 crew members with 2 instructors
Crews Operating at any given time Up to 40 each summer. None year round. 2 1 - 2
Support Required/Crew Program Coordinator for every 3 crews. VYCC staff finds projects, secures funding, designs program recruits participants, etc.Seasonal approach requires annual hiring. Project Manager/ Estimator finds jobs, prices them. Supports both crews.
Northern New England
Trades Women (NNETW) provides development and additional support Construction trainer sets up jobs, coordinates with area housing nonprofits. Additional staff for life skills, support services, etc.
Typical crew member Age 16-24, from varied backgrounds; want to be part of a team completing a meaningful project. Women who want training and experience in building renovation and construction. Most have already completed the Step-up program. Low-income 18-24. Want to learn construction skills and excited about community involvement.
Cost to hire $4,500/week about $125/hour No charge for labor - Compensation paid to Crew Start at $6.25/hour; increases weekly if participant meets standards. $9 to $12.50 per hour plus leave benefits (No health insurance.) Stipend - $50 per week at orientation, steps up in $25 increments. “Not a livable wage” - Estimated cost to operate the program $7,500-9,500 per crew per week. $125/hour plus a portion of NNETW’s operational expenses. $15,000 to $20,000 per year per participant.
Program Design Considerations
The experiences of these groups as well as the insight provided by users of the St. Johnsbury work camp indicate a number of criteria that are essential to programmatic success. These include:
- Skilled job “estimators” who:
- can get the job, bid it, procure materials and bill in a timely manner;
- accurately estimate the cost and timing of projects;
- know their crews and limit their undertakings to the range of their abilities;
- are able to effectively schedule jobs within the constraints of participants’ work schedule (i.e. keep everyone busy as much as possible within available hours.);
- are respected and trusted by the project’s clients.
- Consistent job site instructors/supervisors who:
- are role models, good carpenters and effective and skilled teachers
- are skilled about organizing their crew;
- are respected and trusted by the project’s clients; and
- want to make the experience work.
- Participants who:
- have applied and been selected to participate;
- indicate a readiness to work they show up and are clean, sober, well fed and well rested.
- Meaningful projects close to where the selected crew is housed.
- Clearly defined and enforced policies regarding drug and alcohol use. VYCC also prohibits the use of tobacco.
- Client/Partners who:
- are willing to manage the relationships and scheduling with other subs on a job site;
- want to make the experience work.
- Placement and follow-up support.
No matter what type of approach is selected, the City of
’s housing staff would be critical partners for the development of this option. Other key partners would be the Burlington Housing Authority, Housing Vermont, and the city’s nonprofit housing developers.
Build and Sell Cabinets
Most new affordable housing construction and many rehab projects require the installation of cabinets that meet HUD’s “severe use” specifications. The major cabinet supplied to meet these specs are sold by Tri-Pac aka Triangle Pacific Corp. and made by IXL Cabinets, a division of Armstrong Company.
Nonprofit housing developers seemed quite receptive to removing cabinets from a bid package particularly if the total value of a contract is less than $25,000 (i.e. the trigger point for meeting competitive bidding requirements.) If VCI were price competitive with Tri Pac, the demand could easily exceed 100 kitchen configurations each year.
The most critical issue is cost, although ability to deliver on time is also an important consideration. Within the past few years, GHT asked the
shop to price some cabinets and found that prices were not yet competitive.
The Westgate Apartments project in
is a Housing Vermont-sponsored affordable housing project currently under renovation. Architects Williams & Frehsee, Inc. of
provided the drawings for a typical kitchen installation in the project. The exact mix of cabinets is detailed below. Pricing is from IXL’s July, 2001 price list:
Description Product Price
4 drawer base DB15 or DB 18 $ 460
Sink base cabinet SB36 460
Blind base cabinet BLB48/51 605
Base cabinet B12 311
Base cabinet B15 324
Filler 3UF 37
Base cabinet B27 475
2 wall cabinets W1530 482
Wall cabinet W2430 272
Corner wall cabinet CW2430 391
Over stove wall cabinet W3015 258
Total $ 4,075.00
NOTE - Actual costs at Westgate averaged $3,000/unit despite the specific pricing shown here.
An additional concern is whether or not architects would be willing to specify the use of VCI in the specs. Unfortunately, the HUD specs appear to require that cabinets “bear the label of an independent agency that maintains continuous control over the testing and inspection of the cabinet.” Use of VCI cabinets may therefore require a waiver from HUD.
Local suppliers may be interested in brokering these cabinets, which could avoid the issues of separate bidding, help suppliers stay in the profit-loop, and perhaps lead to more jobs for the corrections system.
Restoration of historic windows
The use of federal funding for the rehab of historic buildings requires that existing wooden windows be restored, if possible. In late 1999, the New Leaf Cooperative Enterprise Program of the Burlington Community Land Trust contracted with Yellow Wood Associates of St. Albans, VT to investigate and document market opportunities for a business specializing in historic window restoration. A copy of their January, 2000 report will be provided to VOWP.
Window restoration is a highly labor intensive process that makes use of traditional materials wood, glass, putty and specialized methods (traditional joinery, high tech wood/epoxy repairs, glazing, painting, etc.) to effectively repair and rebuild historic windows. A typical 20-window project might require the construction of two new windows, repair of 8 and weather stripping of all. Work must be conducted on-site (window removal, re-installation and weather stripping) although repair and replacement construction often occurs off-site. The alternative to repair is often the installation of vinyl windows which although more expedient can cost about the same or more. Labor is often 80-95% of the total cost of window restoration. The work involves knowledge of historic methods, an attention to detail and craftsmanship. All indications suggest that there is an urgent need for window specialists within the historic preservation community.
The New Leaf report indicated the presence of about a half-dozen firms in
that restore, rebuild and maintain wooden windows. They include contractors, carpenters, restorers and millwork shops. While a couple of the firms plan to focus on and grow their window restoration work, most of the contractors (who are already working on these historic buildings) indicated an interest in sub-contracting the work to a window specialist. The report indicated a demand within the nonprofit housing community of about 300-400 windows per year. At a cost of about $350 per window, this could be a $120,000 per year business. New Leaf has not pursued this opportunity
Resources needed to develop a window restoration business would include training in traditional methods of window construction and repair, specialized wood shaping equipment and development of credibility and referral systems with the historic preservation community. The key to implementation of this type of program would be partnering with contractors or a work crew able to work on-site and finding a supervisor/trainer with the knowledge of historic preservation methods and a commitment to working with offenders. Unlike many of the other options presented here, window restoration could be an ideal occupation for people seeking solitary work opportunities with a focus on craftsmanship.
The capital needed to develop a “truss plant” is significant. Estimated cost for a small start-up plant is $1.0 - $1.5 Million. Major pieces of equipment include a “truss table,” “truss trailer(s),” overhead crane, at least two trucks, and a large workspace and yard for materials storage and construction.
Truss manufacturing requires careful attention to engineering detail, and each truss must be engineered to certain standards. Oversight and supervision of construction is critical to success. There is no leeway in measurement- if a truss does not fit, it must be returned and replaced. Trusses are key elements of the critical path of building construction- and “Just in Time” delivery is required. The building contractor will rent a crane for installation, and at rates of $150 to $200 per hour, plus work crews, even an hour’s delay in delivery has negative cost implications.
There is one
truss manufacturer- Lacillade’s in Williamstown. Another shop was started up in Williamstown, but is no longer in operation. Trusses also come to
, and from
. There is a steady demand for trusses. However, high and steady volume is required for those capitalizing new plants.
’s “affordable housing” sector does not produce sufficient volume of need for trusses to make this sector alone a viable market for a new truss plant.
As in most other component manufacturing, there is a key question of perspective: what does the market perceive to be the quality of “prisoner manufactured” components? We have found this to be on the minds of all contacts in the building industry, and not easily resolved.
Panelization requires a high initial capital investment, similar to that of trusses. The other constraints- need for a large yard space, just in time delivery, and engineered quality- are similar as well.
There is currently little market for panels, although this market is expected to grow. Historically, affordable housing developers have sought pre-constructed buildings or panelized construction about once every three years. Projects making use of pre-fabrication include the
and Holy Cross Senior Housing in
. Even with these projects, the
market for panelization currently remains fairly small. Builders note that most multi-family “affordable housing” brings strict standards and design details that do not necessarily lend themselves to panelized construction. HUD’s recent interest in panelized construction may change this perspective relatively quickly as could a marked improved in the economy.
Panels are made by LaValley in
. There is a rapidly growing panelization sector in
Solar thermal panels for hot water systems are relatively easy to manufacturer. Composites of a base material, copper piping, and glass or other transparent cover, these panels do not require a heavy up-front capital investment. The fabrication requires soldering and some welding skills, but otherwise basic joining is all that is required.
Solar photovoltaic panels require a much more sophisticated manufacturing set-up, and commensurate investment. Technological advances are moving the industry forward quickly. To tool up for such a manufacturing venture would require the promise of a high volume market.
Price is not the primary consideration for buyers of panels. The cost of the finished, pre-fabricated panel is about one-third of the cost of a finished installation. Key is the quality of the product, both in its performance and its durability. A 25-year warranty is an industry standard, and this presents the most significant issue for new product developers.
The entire current market in the state of
is about 200 panel installations annually. Except in rare installations, the viable use is seasonal. Any set-up, even for the relatively easy to produce thermal panels, would likely need to be justified by a larger market than
alone could provide.
While solar hot water heating holds promise for affordable housing as a way to stabilize or lower operating costs, it has not yet been incorporated into most providers’ plans. And while photovoltaic panels are reputedly very reliable, the cost-benefit of purchase and installation has not yet reached a point where the investment has been justified in affordable housing development.
The question of the perception of the quality and reliability of a prisoner-manufactured product was strong here. “Will the system still be making these panels in 25 years?” The reliability of the manufacturer and the ability to honor the 25-year warranty seem to be key issues.