Building Material Reuse Can Pay Off

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Source: BUILDER Online
Publication date: November 23, 2009

By Teresa Burney

It's happened to every builder--the windows you ordered are the wrong size and unreturnable so they sit in the warehouse for years.

And most every remodeler has shaken his head while hauling a perfectly nice set of cabinets to the landfill because the homeowner wants something different and he has no place to store them.

But in many parts of the country, there are places where these misfit building materials can go to find homes. And, in the process, donators can get tax deductions, cut landfill fees, and pat themselves on the back because they've done something "green" by cutting landfill waste, providing cheaper building products for those in need, and helping create "green" jobs for those who sort and sell the donations.

The win-win-win of building material reuse has stimulated growing interest in recent years. And the downturn in the economy has created more demand for the donated products. But, as demand has risen, many reuse organizations report that donations have fallen because there's less building going on.

"We are looking at a nice demand for our products, but it's harder to get material," said Ron Whittaker, northern California regional manager for The ReUse People, which deconstructs buildings, takes donations of building supplies, and resells them at several locations across the country.The ReUse People have small contractors, looking to save their customers money, coming to their warehouses several times a week to look for materials. Now there's less incentive for people to come.

Whittaker is hoping business will pick up in December when people start thinking about potential tax deductions.

While they are fewer these days, The ReUse People still get some wonderful donations that translate to bargains for buyers. "We get cherry wood cabinets, and we sell them at 15% of retail," Whittaker said, adding they typically charge between 10% and 25% of retail for items.

"But we are a nonprofit, we allow ourselves to be bargained down all the time," he said. "I'm looking out my window at a Sub-Zero refrigerator with an oak veneer. We are selling it for $500. If you had $400 and a pickup truck, we'd sell it to you."

The Green Project, a New Orleans-based recycler of building materials and art supplies, too, reports an increase in demand and a decrease in supply.

"The rebuilding has definitely kind of tapered off," said executive director Angie Green. "Either people have completed their jobs, or they are deciding to wait. At the same time, people are shopping [for discounted building supplies], but they tend to spend less money."

Shoppers for recycled materials in New Orleans can find some rare and impossible-to-buy-new bargains, said Green. The Green Project charges 20% to 40% of retail for its goods.

"And it's not like you can walk into a Home Depot or Lowe's these days and find a solid cypress door," she said. "There's amazing lumber still stuck in those buildings that are eventually going to be demolished."Green encourages donations of houses rather than demolition. "You can donate a whole house worth of materials and take a huge deduction for the next 20 years."

But not every reuse organization reports a slowdown.

"We are actually getting more" donations, said Meghan Adkins, donation coordinator for Community Forklift in Silver Spring, Md. "I would say in the past six or eight months we've gone from three to six pickups [of donations] a day from builders, homeowners, and businesses."

Adkins and Ruthie Mundell, the organization's outreach director, credit growing awareness of overflowing landfills and green concerns for the increase in donations, but the idea of a tax break has appeal as well since more are asking about the tax donation issue.

"If you think about it, we are completely bombarded with information about climate change," said Adkins.

The desire to be environmentally savvy and reuse rather than buy new, as well as the need to save cash, has also affected demand, said Adkins. "In terms of numbers of customers, this summer was a record and so has this fall," added Mundell.

Habitat for Humanity's ReStores, which accept donated goods for resale, have been proliferating across the country with three or four added each month, said spokesman Kevin Campbell. There were 673 at last count.

Habitat, unlike some other building supply reuse organizations, has had fewer problems getting donations because it receives corporate donations from manufacturers.

ReStore operators "definitely say donations are down from the homeowner market, but the slack has been taken up by greater donations of new merchandise from manufacturers," Campbell said. "Some of our donor partners, like Whirlpool and Dow and Valspar, have added ReStore as a component recently."

And the push for green solutions to waste has helped as well. "We definitely feel that," he said. "There are a lot of people who are thinking before sending things off to the landfill, homeowners and companies as well."Campbell said ReStore's $250 million in gross sales profit netted the company $85 million last year and, since the proceeds are undesignated to one particular fund, it can be used to pay salaries and utilities and other Habitat expenses.

Operators of building materials reuse outlets said they hope the government will begin taking more notice of the industry.

"One of our dreams is that one day the government will subsidize reuse," said Adkins of Community Forklift. "There are a few places where that is starting to happen." Adkins pointed out that government often subsidizes the costs of landfills.

"Even within the green building community, most of the focus is on energy efficiency, water resources, indoor air quality rather than interest on using salvaged goods," said Whittaker.

The industry has some problems with meeting building codes with salvaged materials. "This is a challenge for our industry to address. We need some grades for salvaged lumber, not just new lumber grades," he added.

Some tips on donating building material:

--One place beyond the phone book to find organizations that accept building materials for a tax donation is at the Building Materials Reuse Association's Web site: www.bmra.org/listings/browse-by-state?catid=3.

--Call or check the organization's Web site for donation criteria. Some accept appliances, some don't. Most don't accept soft goods such as couches. All want things they can truly resell, not items that truly belong in a landfill.

--For information on how to claim a tax deduction, check with your accountant or visit IRS.gov.