By Chris Millis
Raleigh, NC – On July 25, Gov. Roy Cooper issued a press release on House Bill 488, legislation enacted into law nearly a year ago. In this statement, Cooper wrongfully alleges harmful effects while also mischaracterizing the purpose of the legislation. Since several media outlets have repeated these allegations without critical analysis, we here at the North Carolina Home Builders Association (NCHBA) believe is important to set the record straight.
In an apparent partisan effort to malign “legislative Republicans,” Cooper claims that certain provisions of HB 488 “recklessly” blocked new building codes, which, in turn, negatively affected home-insurance rates and caused our state to “miss out” on federal recovery grant funds. These claims are false and demonstrate a disturbing lack of concern for housing affordability in our state.
Before addressing the substance of Cooper’s claims, it is important to point out that HB 488 enjoyed strong bipartisan support in both legislative bodies. Cooper fails to note in his press release that members of his own party, not just Republican lawmakers, supported HB 488. In fact, several members of Cooper’s own party voted to override his veto of the legislation so that it became law.
The truth about House Bill 488
In order to build a home in our state, a builder must build it to minimum standards aimed at protecting life and safety. These minimum standards are set forth in North Carolina’s Residential Building Code. The Residential Building Code is amended regularly by the Building Code Council at its quarterly meetings. In addition, the council conducts a complete rewrite of the code every six years to consider updates from various international model codes.
Contrary to Cooper’s claim, HB 488 did not prevent the council from requiring additional measures involving improvements to structural integrity, fire prevention, or any other life or safety-related component. In fact, the legislation specifically directs the comprehensive code update that was underway in 2023 to be implemented by the council. This process is designed to bring North Carolina from a currently effective 2018 residential building code into a 2024 residential building code, which includes various provisions to make homes safer and more structurally sound.
The only element of the Residential Building Code that HB 488 paused at 2018 levels is an update to provisions involving expensive energy code-related measures. This pause, which will last only until 01/01/26, has no impact on the structural integrity or fire-prevention protections required for new home construction in our state.
Prior to the 2023 Session, it became evident to our association that Cooper and the 17-member Building Code Council, all appointed by him, were determined to force a politically motivated climate agenda into new home construction throughout all of North Carolina. It also became evident that the council intended to do so without any consideration of the cost that their energy agenda would place on housing and the ability of our citizens to afford them.
When all costs were considered, the energy code mandates that Cooper and his followers advocated for would have increased the cost of the average home in North Carolina by at least $20,000 while only achieving a maximum of $400 per year in energy savings. Simple math demonstrates that it would take a homeowner over 50 years to break even on these additional costs. Not only does this not make sound financial sense, it represents a foolish waste of resources with negative environmental implications.
To be clear, with approximately 60,000 new single-family home starts in North Carolina each year, without HB 488 as advanced by supporting lawmakers in the General Assembly, Cooper’s new energy code would have cost over $1.2 Billion annually (not including finance charges).
Make no mistake, North Carolina is in the midst of a housing crisis where middle-class and first-time home buyers cannot afford to purchase a median-priced home. Adding $20,000 in unnecessary costs is the last thing we need.
Since the new Residential Code Council, created by HB 488, is tasked with reviewing these paused energy code amendments by 01/01/26, we are confident that the new council will balance improved residential energy-efficiency standards against the ability of prospective home buyers to afford them.
The truth behind Federal Emergency Management Agency (FEMA) grant funds
Regarding Cooper’s claims of a loss in federal funding as a result of HB 488, data from recent FEMA BRIC funding shows that appropriations to the program went from $2.295 billion in FY 2022 to $1 billion in FY 2023 (with only $675 million currently allocated for specific grant projects). When considering how North Carolina has performed against other states over the past three grant cycles in contrast to the reduction of available funds this year, our state is outperforming rather than underperforming, even with HB 488 as law.
This analysis of the available federal data is of no surprise, since a component of the federally established scoring criteria for potential FEMA BRIC funds awarded to a state is the latest edition of a state’s building code. HB 488 made explicitly clear to the Building Code Council that nothing within the bill prevented the council from adopting a new building code which it did this past year.
The truth behind insurance costs
The fact that code updates are allowed to be made upon each meeting of the Building Code Council and that a complete code rewrite occurs every six years (including a new code update for 2024), with both opportunities allowing for advancements to make homes safer and more structurally sound, no one can reasonably conclude that a homeowner’s ability to retain and afford homeowner insurance is harmed as a result of the enactment of HB 488.
In fact, it had the opposite result. It prevented costly increases to energy codes unrelated to a home’s ability to withstand severe weather, and it certainly did not harm fire prevention-related construction measures.
Without the passage of HB 488 and the overriding of the governor’s veto, an increase in the cost of the average home in North Carolina of $20,000 would have directly led to rising insurance premiums since the cost to rebuild a home resulting from a complete loss would have substantially increased.
Conclusion
Finally, Cooper, in his press release, stated that NCHBA lobbied on behalf of this legislation so its members “can profit more from cheap construction at the cost of homeowners.” These comments are an insult to the hardworking men and women of our association who provide the American Dream of homeownership and thousands of jobs each year for the citizens of this state.
Frankly, if our members were only concerned with profits, we would support expensive mandates, like those that Cooper advocates, since there is more profit to our members by selling more expensive houses. However, we recognize that we must do all we can to limit unnecessary housing costs so that the first-time home buyer can afford to purchase a house. Homeownership is critical to the future of our state.
As a result, we here at NCHBA will continue to strongly advocate for affordable options for individuals of all income levels to be able to enjoy the benefits of owning a home. A special thank you to all lawmakers who supported HB 488 and who stand with us in advancing housing affordability.
Chris Millis is director of regulatory affairs for the North Carolina Home Builders Association and a former member of the NC House of Representatives.