Freedom Line Blog

This week, in an official comment filed with the U.S. General Services Administration (GSA), CFIF called for reform or replacement of the Leadership in Energy and Environmental Design (LEED) standard endorsed by the GSA.  Americans deserve a building certification system that is more fair, open, evidence-based and that uses consensus-based standards.

Although the issue of forest certification remains rather obscure to most Americans, its regulation significantly impacts the price consumers pay for wood products, not to mention America’s struggling domestic timber industry.  Unfortunately, a vocal group of environmental activists only endorses Forest Stewardship Council (FSC) certification, and prefers it as a monopoly, while irrationally demonizing competing forest certification systems.  Among other things, those activists successfully pressure Fortune 500 companies into accepting the exclusive use of FSC-certified products, and many government and rating agencies to only award green “credits” to forest products recognized by FSC.

That policy causes the market to become increasingly distorted, with real costs for producers of wood and the environment, and fewer choices for consumers.  A recent study by the American Consumer Institute estimated the costs of carrying that policy to its endpoint.  Namely, FSC certification as a binding requirement for American forests means consumer welfare losses in a number of markets, totaling $10 billion for wood products and $24 billion for paper products markets each year.  Another destructive consequence of the FSC monopoly is that wood from almost 75% of America’s certified forests is placed off-limits.  While that single-source arrangement benefits the FSC and activists, it imposes significant costs on the domestic forestry industry and discourages competition.  That’s because FSC holds foreign landowners to lower standards than U.S. foresters.  For example, harvesting 600-year-old Russian trees occurred on FSC-certified property.  Such an arrangement discriminates against domestic foresters and increases the likelihood of builders seeking foreign suppliers of wood.  In fact, 90% of FSC’s certified land is found abroad, making it fairly easy for businesses to access foreign timber.  Typically, the government interferes with the market to ostensibly protect American industries.  Here, sadly, it is relying on an unaccountable third-party to do the opposite.

The current LEED policy also jeopardizes American jobs;  penalizes smaller landowners who use other certification systems;  discourages the use of many common building materials and other products that are regularly found in construction projects, such as PVC piping, foam insulation, heat reflective roofing and LED lighting face.

Meanwhile, there exists little to no clear environmental benefit to using FSC over alternatives like SFI or ATFS.  A recent study published in the Journal of Forestry examined the impact of FSC and SFI forest certification in North America, and found few differences in land management outcomes of those two alternative systems.  Additionally, the League of Conservation Voters, National Alliance of State Foresters and National Association of Conservation Districts also favor a more level playing field for certification.   Those groups possess much better on-the-ground expertise than the activists who come from marketing backgrounds and lack credentials pertaining to land management or environmental science.

We conclude:

We already witness too many government policies picking winners and losers in the marketplace.  For the federal bureaucracy to allow a third-party environmental group to do so is appalling.  Given USGBC’s agenda and arbitrary actions, it is reckless to empower that organization to dictate a government-sanctioned standard, especially when that standard stifles growth and kills off American jobs during this time of economic uncertainty…  LEED in its current incarnation as the government-approved standard is simply unacceptable.  American consumers, small businesses and our domestic timber industry deserve much better, and the era of the USGBC’s taxpayer-subsidized monopoly must end.”

Meanwhile, in an excellent Forbes commentary this week, George Mason University fellow Jon Entine echoes our view.  Entitled “Forestry Labeling War Turns Ugly as Greenpeace Bungles Logging Industry Attack,” Entine neatly examines the contradictions and tensions contaminating the current forest certification regime:

Policies regarding the procurement of timber, use of building codes and what businesses can sell to their customers should be informed by facts and science, not scare tactics. Greenpeace’s deception is only the latest propaganda effort that has muddied rather than clarified the issues surrounding forestry practices. With a majority of forests lacking certification, we need common-sense incentives and more certification options to achieve sustainable forestry management goals. Consumers and the general public deserve much better than the disinformation campaigns that have shadowed this debate.”

Fortunately, the GSA review period offers the opportunity to return credibility to the building certification system.