In Pennsylvania, residential construction falls under the purview of the Uniform Construction Code (UCC), which was adopted in March 2004 after the passage of the Pennsylvania Uniform Construction Act of 1999. That act was a long-awaited remedy for what was a patchwork of thousands of municipal interpretations of various building and zoning codes. Over the past 20 years, more than 90 percent of the commonwealth’s municipalities have opted in to the UCC, which is overseen by the PA Department of Labor and Industry.

What is the source of frustration and irritation? Like with most regulatory structures, the UCC is administered and interpreted by humans. With those humans come different levels of competence and effort. Politics becomes involved. Pennsylvania’s legislators and the Department of Labor and Industry have moved slower than most of the many organizations that inform the UCC, so that the prevailing version of the UCC is still based on the 2018 updates by the International Code Council, UCC Review and Advisory Council, and other agencies tasked with keeping building codes current. Now, the long-awaited update to the UCC to 2021 standards is ready to roll out and the revisions, although minor, will make building a new home more expensive.

For builders and their clients, this means that the ever-increasing cost of a new home will be even higher. Because the rollout of the updated UCC has been delayed there is more uncertainty and added time to a process that is already expensive and time consuming. Building codes are a necessity, but they create lots of friction in the marketplace.

The Problem with Codes

The free enterprise system is always in tension with regulation. Construction is one of those industries that requires more than minimum regulation to ensure that buildings that the public uses are safe to occupy. Building codes are a type of regulation that has generally been a local regulation. That was the case in Pennsylvania until Act 45 of 1999 established the Uniform Construction Code. Prior to the UCC, there was general uniformity of building code from county to county and municipality to municipality, but there were outliers. Moreover, the lack of a uniform code elevated the risk of unfair application of local codes by an individual code officer or building inspector. The lack of a uniform code also made enforcement of compliance more difficult.

Not surprisingly, Act 45 spawned legal challenges and administrative delays, as Labor and Industry had to reorganize its resources. Time also had to be allocated for municipalities to study and opt in or out of the UCC. All those activities delayed the implementation of the UCC until April 2004.

For builders, the process of gaining approval and a building permit did not change materially after the UCC was adopted. New homes have site plans and drawings that are reviewed by a municipal official or third-party code compliance service. Once the design is verified to meet the code requirements, a building permit is issued, and construction begins. Inspections are scheduled throughout the construction process to verify that the systems subject to code compliance – foundations, framing, plumbing, HVAC, electrical, fire safety, doors, and windows, for example – are constructed as designed. At the end of construction, a final inspection leads to a certificate of occupancy that assures the homeowner that the new home was built properly.

That process was more or less how new construction was done prior to 2004. What created headaches for builders were the ongoing revisions to the UCC that followed.

“The building code was intended to ensure life safety and health of the home and homeowners. It was supposed to be a minimum code,” says Jim Eichenlaub, executive director of the Builders Association of Metropolitan Pittsburgh (BAMP). “It was effective at that. Over the years it has become a Utopian code that is influenced by product manufacturers. The problem is that 99.9 percent of the changes that have been made to the international codes have nothing to do with life safety. The biggest area of impact has been the energy provisions.”

The process for updating the UCC was most recently legislated under Act 36 of 2017. As the International Building Code (IBC) is updated every three years, a process of review begins in Pennsylvania through the Review and Advisory Council (RAC).

“Every three years, the RAC—an independent body consisting of 21 members who represent a variety of constituencies—reviews any updates to International Code Council codes that make up the UCC and, after a robust and public process, decides what updates will be adopted as regulations in Pennsylvania,” explains Danielle Woods, press secretary for the Department of Labor and Industry. 

“The report for the 2021 code update was submitted towards the end of 2024. The department reviewed the recommendations and handed them off to the Independent Regulatory Review Commission (IRRC). That’s where we are right now,” explains Chris Hine, assistant director at the Pennsylvania Housing Research Center at Penn State University. “We don’t know if the recommendations have been handed off to IRRC yet, but based on published IRRC meeting dates, and the timeline required to notify the public, we know the adoption will be pushed back from the planned July 13th enforcement date.”

For designers and contractors looking for implementation of the new codes, any plans or construction contract approved before the enforcement date may use the 2018 code, as long as a building permit is applied for within six months of the enforcement date. Any plans approved or contracts signed after the enforcement date will fall under the 2021 UCC.

Regardless of when the enforcement date is, the changes to the 2018 UCC are known. For the most part, little has changed that would affect life safety and structural codes for residential construction. There are changes to the energy codes that can affect home building. Eichenlaub cites the inclusion of energy codes as the primary driver of costs, both for construction and design.

Energy codes, like the International Energy Conservation Code (IECC), are a subset of building codes focused on minimizing energy use in buildings. Including energy codes in the IBC, from which the UCC derives its updates, helps reduce energy consumption, lower utility bills for building owners and occupants, and minimize the environmental impact of buildings. Energy codes do deal with ventilation and air quality measures that improve the health of occupants, but most of the energy codes cannot be justified as life safety measures. For advocates of energy efficiency and sustainability, reducing energy consumption is a public benefit that justifies the building codes.

“As Pennsylvania prepares to adopt updated energy provisions in its UCC through the IECC, it’s important for the residential construction sector—as well as homeowners, renters, landlords, and taxpayers—to understand the long-term value of the changes,” says Chris Cieslak, chief operating officer of the Green Building Alliance, the Pittsburgh-based advocate for sustainable buildings.

“The residential construction sector has historically lagged commercial construction in adopting modern building practices,” she continues. “Updating building codes to require better energy performance is a shared solution that benefits everyone. Just as the automotive industry has steadily advanced fuel economy, emissions controls, and safety features, the building industry must evolve to ensure today’s homes meet modern expectations for comfort, cost-efficiency, and resilience.”

Cieslak notes that homeowners benefit from the stricter energy codes by lower operating costs of heating and cooling, increased home values, and better compliance with insurance and lending standards that are increasingly considering energy performance in underwriting. She suggests that the public benefits as well by reducing the energy needed from an overtaxed electricity grid and the emissions that result from electricity generation by coal and natural gas.

The associations representing homebuilders, the National Association of Homebuilders (NAHB) and its local affiliate, BAMP, spend considerable resources on raising awareness of builders’ problems and influencing legislation that will affect builders. Both organizations promote the adoption of more energy efficient design, and better performing homes overall, as best practices for the industry. However, the industry associations insist that these improvements should be intentional decisions made by the homebuilder or homeowner, not mandates that exceed life safety standards. Increased regulation, they argue, increases construction costs and makes it harder to build affordably at a time when home ownership is extremely difficult.

How Do Codes Affect the Market

The higher standards for energy efficiency and thermal performance are the main areas of concern about the 2021 UCC. While some of the more stringent standards, like higher R values and solar gain coefficients for windows, will not result in significant cost increases, the changes that affect insulation and the building envelope will.

“One of the changes that will affect builders in Pennsylvania is the revision to the climate zone maps. Moving forward, the climate zone map was updated to include only two zones, four and five. (Western PA is in zone four.) The prescriptive R values for those climate zones also change,” explains Hine. “If builders build to what is prescriptively written in the code, they will need an R-23 cavity-only insulation value. Previously the requirement was R-20. That is probably one of the more difficult hurdles in the new code.”

Hine explains that to achieve R-23, builders need to get you outside the typically used insulation like R-20 fiberglass batt insulation. To achieve a cavity-only R-23, builders must go to a mineral wool product that is five inches thick or a combination of closed-cell foam and batt insulation. In either case, the wall cavity will be larger. That brings other considerations that add to cost.

“In the case of requiring heavier insulation, the builder has to go from a two-by-four frame to a two-by-six frame. The larger dimensional lumber is more expensive. Another provision shortens the distance between the bathrooms and the hot water heater. That will require multiple water heaters or a continuous loop system. Those cost money and change the design of the home,” says Eichenlaub. “It’s not just the cost of the energy conservation measures. There are additional testing and inspections, which drives up the cost of permits. Our estimate is that the new codes add $15,000 to $20,000 to the cost of the home.”

Chad Weaver, president of Weaver Homes, believes Eichenlaub’s estimate is in line with what he anticipates for his business. Weaver notes that the code update compounds the cost pressures from the previous code revision, which occurred in 2021 as construction escalation was reaching double-digit increases.

The share of single-family homes built by custom builders has fallen by 11 percentage points since 2015. Source: Pittsburgh Homebuilding Report.

“The biggest jump was when the codes changed from [IBC] 2015 to 2018, and the energy code was revised from five air changes an hour to three. To get a house that airtight adds a lot of cost, he says. “The latest version forces those of us who were still able to use two-by-four walls to go to two-by-six. The code for below-ground insulation forces us to go down four feet instead of two. Our footers don’t even have to go down four feet because the frost line is only 36 inches. We like building energy-efficient homes, but I’m not sure the cost benefit to the owner is justified.”

“The electrical code is also getting more extreme. Those changes are going to add $500 or $600 to a home because of the new breakers. Many appliances aren’t compatible with the new breakers.  The problem for homeowners is that appliance makers don’t talk to the people who make electrical equipment, and the appliances are tripping the breaker.”

The impact of the new code will vary, depending upon the type of builder or home being built. For the middle-to-upper end of the market, the buyer is typically more discriminating and experienced. The price tag of the home is higher. Builders of these types of homes make up the majority of the homebuilders in metro Pittsburgh, but they built only one in four houses started since January 2024. Where the increased regulation will hit hardest is the production-style builder or the builder focused on affordable housing, which requires vigilant cost control. The new codes add numerous incremental increases that will make controlling costs more challenging.

“We tend to focus on building science performance. We don’t use prescriptive codes for building performance,” says Dante Fusaro, at Phillip Wentzel Custom Homes. “We use more insulation than the R-21 required in the wall or R-49 in the roof because we want the home to be more efficient. We put more sheathing on exterior walls and roof for better sheer strength. At a minimum, we’ll adhere to code, but for a generational home, which we tend to build, we will go above and beyond.”

Building science is a method of construction that focuses on how well a house functions as a system, considering factors like energy efficiency, indoor air quality, durability, and occupant comfort. This holistic approach carries with it some premiums in cost that more discriminating buyers are happy to bear because the final product will be more valuable. For first-time buyers, or buyers who will be stretching their finances to afford a home, even small incremental increases in cost matter.

One factor that may mitigate whatever additional cost burden results from the new building codes is the fact that several of the Pittsburgh region’s biggest builders – Ryan Homes/NVR and D.R. Horton – have focused on energy efficiency as a differentiator. The same is true for the builders – Scarmazzi Homes, Weaver Homes, and Traditions of America – who focus on the empty-nester home that is being built throughout the region. It is likely that the ripple effect of the energy code improvements will bump their costs, but history suggests that these production-oriented builders will adjust.

“Since we are already building to a higher energy code with two-by-six walls and R-49 ceilings, we don’t anticipate any increased cost in our insulation and energy package,” explains Jonathan Probst, operations manager for D.R. Horton’s Pittsburgh region. “I do anticipate electrical cost increases due to some of the adoptions that will come with the 2021 code.”

For all the complaining about building codes that the residential construction industry might do, the UCC serves an important function for the marketplace. By setting minimum standards for how the building is constructed and performs, the UCC ensures that homebuilders that comply with the code are differentiated from unscrupulous contractors. The UCC also ensures that homebuilders expanding into Pennsylvania markets are competing on an equal footing with the existing homebuilders.

Pennsylvania’s RAC will soon be studying the recommendations being made by the IBC for the 2024 UCC update. By the time those recommendations are made and implemented in the market, in 2028, builders will have adjusted and the trade associations to have had an impact reigning in the regulatory burden. The net result of the back and forth between regulators and the industry will be an incremental advance in the quality of the homes built in Pennsylvania. With those improvements will come higher costs. It will be up to the marketplace to determine who pays that cost?  NH