This credit involves a review and analysis of your building’s operational expenses. The goal is to better understand the financial impact on overall operating costs of improvements made during the LEED performance period.
It’s not intended to compare buildings to one another, or to demonstrate that your LEED investments generated specific paybacks. It’s simply valuable for you to understand how your building performs over time. Internal consistency with your accounting methods is more important than whether you categorize expenses in the same way other projects do.
The credit is primarily an accounting exercise—you’ll collect historical financial data detailing the year-to-year expenses for cleaning services, building repair and maintenance, utility bills, and roads and grounds maintenance. You’ll also need to provide information about costs associated with sustainability improvements and LEED project costs that you incur during the performance period.
Many buildings already track this type of information—you’ll just have to note which data categories are relevant to LEED and make sure that you’re categorizing the information properly.
A lot of data, but some flexibility
The credit specifies that you provide all the operating cost data for the five years preceding the performance period (or length of occupancy, whichever is shorter). But if you’re unable to provide five years of data, you can still earn the credit if you provide a narrative explaining the gaps in the data.
If you don’t have itemized historical data for all the subcategories, you can still pursue the credit—as long as an accurate total for each broad category is available.
Get friendly with your accountant
Work closely with your organization’s accounting division when compiling this information. For buildings with relatively detailed records and a helpful accounting department, this credit should be very achievable.
Organizing cost information
A frequent question on this credit is about how to organize cost data in terms of historical data and the performance period, when the performance period is less than a year or straddles two different calendar years.
If the performance period is less than a full year you can take the known costs for the first part of the year and extrapolate to a full year of costs.
Also, if you have a performance period that straddles two different years, it may make sense to apply only the most recent year to the performance period costs and extrapolate to a full year. But there is no requirement to follow a calendar year and so you could just adjust the timeline to follow a different “fiscal” year. The maximum number of years to apply to the performance period is two years for the initial certification and five years for a LEED-EBOM recertification.