High oil prices that affect energy prices and cause material shortages certainly make the headlines. But it may surprise you to learn these same economic factors during the late 1970s contributed to one of the largest class-action settlements in the history of the roofing industry. And roofing professionals still are affected by the consequences of that lawsuit.
During the late '70s, near the end of the Iraq-Iran eight-year war, oil prices peaked. Consumers felt it at the pump where gasoline went from about 30 cents per gallon to a dollar or more. Building owners and managers became increasingly concerned with heating and cooling costs, and building officials started enforcing energy codes requiring higher R-values for roof system installations.
Until then, most buildings had minimum amounts of insulation, such as 1 1/2 inches (38.1 mm) of board insulation. By the 1970s, contractors and manufacturers addressed the added concern of increasing R-value, which, in turn, increased roof system thickness. This complicated roof system designs, particularly with renovation projects. In addition, building officials began to enforce fire-resistance requirements over metal deck construction.
Manufacturers searched for products that offered the desired insulating capabilities and fire resistance to meet building codes yet kept thicknesses to a minimum to ease construction problems. As a result, polyurethane boards evolved into polyisocyanurate board, and phenolic foam roof insulation emerged. At the time, phenolic foam roof insulation offered a seemingly ideal solution with its high R-value per inch, cost-effectiveness per square versus polyisocyanurate and support from major manufacturers.
From phenolic foam insulation's launch during the early 1980s by Koppers Co. (which eventually was taken over by Beazer East Inc.) to 1992 when it was discontinued, phenolic foam manufacturers estimate they sold at least 6,000 roof system installations that included phenolic foam roof insulation.
What was it?
Phenolic foam roof insulation consisted of a phenolic foam core bonded to nonasphaltic fiberglass and other facers. It was produced in board form in various sizes and thicknesses ranging from 1 inch to 3 3/5 inches (25.4 mm to 91.4 mm). It was sold under the Koppers/Beazer brands Koppers Exeltherm Xtra and Rx and Denver-based Johns Manville brands UltraGard Premier, Insul-Base Premier and Fesco-Foamboard. (The Beazer East manufacturing process and business were sold to Johns Manville in 1989.)
The first inkling there might be a problem with phenolic foam roof insulation came during the late 1980s and early 1990s when roof systems that were less than 10 years old began to fail. The phenolic foam roof insulation turned out to have a critical flaw: When it was installed over a lightly primed, painted metal deck, any water in the roof system from above, moisture from operations or humidity within the building activated chemicals in the phenolic foam, which caused corrosion of the metal deck. At a minimum, the decay was severe surface rusting, and in other areas, it was so great the deck actually developed large holes.
By 1992, the problems had become so extensive Johns Manville (the only manufacturer at the time) discontinued production. Eventually, Beazer East's product was found to cause severe corrosion to metal roof decks and other damage to roof systems. Beazer East initially began a voluntary program to identify buildings and compensate owners for repairing the damage to decks and roof structures caused by its insulation. As knowledge of the problem grew, a class-action lawsuit was filed in 1996 on behalf of building owners whose facilities contained phenolic foam roof insulation installed over metal decks and, in July 2000, a settlement was reached between the class-action attorneys and Beazer East and Johns Manville.
In December 2000, the U.S. District Court granted final approval to the Beazer East settlement and provided funding to remediate all steel roof decks. Members of the Beazer East settlement class included those who own or are responsible as a lessee for a roof with Beazer East phenolic foam roof insulation and a metal roof deck.
The settlement terms differed depending on whether the insulation had been manufactured under Koppers/Beazer East or Johns Manville. Key elements of the Beazer East settlement follow:
The Johns Manville settlement provided compensation at $100 per square for the total number of squares of metal roof deck for single-ply or asphalt shingle roof systems or $45 per square for BUR systems. (The Johns Manville settlement differed from the Beazer East settlement for a number of reasons, including overall age of the roof systems, corrective actions already taken and a change in the manufacturing process after Johns Manville took over production.)
The installations of phenolic foam roof insulation were concentrated in the upper Midwest, East Coast and Texas. Any geographic region that experienced extreme heat or cold was a perfect candidate for phenolic foam roof insulation as a solution to energy loss. Illinois, Michigan and Minnesota had hundreds of installations.
Several consulting firms were instrumental in helping contractors and manufacturers through the claims process. For example, George Butler Associates Inc., Kansas City, Mo., was retained by Beazer East to inspect thousands of facilities to determine the presence of phenolic foam roof insulation and roof deck conditions. And PhenCon, a claims administration consulting firm based in Woodstock, Ill., helps building owners secure remediation bids for their buildings and contractors with the paperwork necessary for the remediation projects.
Timing is everything
The class-action lawsuit provides a detailed timetable for getting work completed. Following an inspection that confirms the presence of phenolic foam roof insulation, a bid specification is prepared and bids solicited. After bids are submitted to the settlement office, the claims office has 45 days to extend an offer. The building owner then has 30 days to accept or appeal the offer. If the offer is accepted, the owner receives 50 percent of the prorated roof value up-front and has 60 days to commence work (but could get extensions because of weather or other extenuating circumstances). The remaining payment and reimbursement for the deck work is paid at project completion.
Although many roof systems containing phenolic foam roof insulation may be in good shape, it is important owners repair and remediate decks as soon as possible for many reasons. A corroded deck presents a potentially serious financial liability for a building owner. Once a building is identified as part of the class-action lawsuit, it becomes an issue if the owner plans to sell the building. The owner also has potential safety issues if, for example, a heating, ventilating and air-conditioning technician or other employee happens to be on a weak part of the roof deck. The technician could fall through the roof, leaving the owner vulnerable to injury claims. Mechanical units have fallen through roofs into buildings.
Although building owners are getting some of the cost of their roof systems and most of the cost of decks replaced, they still likely will have an out-of-pocket amount and may be faced with replacing roofs and repairing decks many years before they planned or budgeted to do the work. They also are responsible for a portion of the legal fees.
A contractor's challenge
A roofing contractor's role is to explain the remediation process to his client. Roofing companies need to be adept at roof deck remediation in addition to their professional roofing expertise. Salespeople must educate customers about the process and let them know what to expect in the settlement process and during the work.
At a job site, the remediation process involves several steps. First, a roofing contractor must remove the existing roof system, including the insulation, down to the metal deck. He then must wire brush the entire deck surface, removing all debris and cleaning the deck.
After comparing the condition of the deck to the class-action deck remediation template issued by Beazer East, he determines whether to paint, overlay or replace the deck. (See photo above.) And finally, he installs a high-quality roof system as specified by the building owner.
Because of its various complicated steps and to fulfill the class-action requirements, a phenolic foam insulation remediation project is far more involved than a typical roofing project and requires specialized training and equipment not typically found on a roofing job site. Extensive training is required by all field personnel and should include communication with the building owner; roof system removal with extra precaution; safety training and precautions; extensive documentation with digital photos and forms; and deck painting, overlay or replacement techniques.
Safety is the first priority on a job because the potential for deck failure is a dangerously real possibility. Safety harnesses are required for all personnel on the job. The crews take particular caution in certain areas, such as around mechanical equipment, that are more likely to have had water intrusion.
Daily scheduling and determining crew size is difficult because they vary not only by the quantity of deck materials to be removed, replaced or overlaid but also by deck condition. Because the required deck painting needs to dry, there are necessary work gaps.
Extra precautions must be taken in painting operations. The paint used in remediation projects is a high-quality marine base, a waterproof paint that will land and stick on everything. A building occupant and surrounding building occupants will have to be informed, and vehicles will have to be moved. Additionally, everything needs to be done within a limited time frame because a roof is open and the customer's building and business is exposed to the elements.
Interior protection is a critical issue. Deck replacement and remediation can create a great deal of debris not only on the ground but potentially in a building, as well. A contractor must exercise extreme caution when working over areas without dropped ceilings and must schedule work around business production cycles of a customer.
Documentation requirements are unique to phenolic foam roof insulation projects because a majority of the deck work is paid for by the class action. Contractors are required to send detailed photos daily to the class counsel so their clients can be reimbursed for the deck remediation work. The claims office relies on professional contractors who can decipher, analyze and determine the extent of the remediation required that will fulfill the owners' needs and meet the standards of the class-action lawsuit.
With so many considerations involved, including not only completion of the work but the detailed documentation and filing that must occur to comply with the class-action stipulations, phenolic foam insulation deck remediation is a challenging proposition for experienced contractors.
Rex Greenwald is vice president of Central Roofing Co., Minneapolis, a member of Skokie-based Tecta America Corp.
Steps in a remediation project