Your HBA as working for you in Washingting (here is how)

by | Sep 25, 2017 | Uncategorized

(September 20, 2017) Ever wonder what your Home Builders Association is doing for you in Washington DC and around the country?  Below is a report of the issues on which we are engaged:

1. Canadian Softwood Lumber

  • The U.S. Department of Commerce imposed a 20% countervailing duty on Canadian lumber imports in April, and added 7% antidumping duties in June. 
  • In late August, Commerce announced a delay in the final duties to Nov. 18. This will allow more time to negotiate a settlement. Collection of countervailing duties is suspended for now, but antidumping duties will continue to be collected. 
  • NAHB is meeting with representatives with the Trump Administration and Congress as well as Canadian officials to address home builder concerns regarding price and availability of lumber. 
  • These meetings are especially important because U.S. consumers cannot participate in trade disputes, although NAHB provided witness testimony during the International Trade Commission hearing on Sept. 12. 
  • Generally, lumber prices have increased, but that may be partly due to wildfires in the Western U.S. and Canada. 
  • NAHB is urging U.S. lumber producers to increase production for domestic consumption, and working to identify alternate foreign sources of dimensional lumber. 

2. Disaster Response

  • In the aftermath of two devastating hurricanes, NAHB is working closely with state and local home builder associations in those areas to help them meet the needs of members affected by the storms. 
  • We sent out an all-member email with information on how to donate to the recovery effort. 
  • NAHB issued statements on hurricane-related advocacy. Our leadership conducted media interviews on flood-related topics, including the need for the National Flood Insurance Program (NFIP) reauthorization, building codes, rebuilding efforts and labor shortages. 
  • We updated our online Disaster Recovery toolkit with new media talking points and safety information for contractors. 
  • We added resources on hiring contractors and places to donate on our consumer Web page. 
  • We are creating resources on business continuity; hiring reputable contractors; and best practices for flood damage repair work. 
  • We will continue to reach out to the affected communities to see how to help in the rebuilding efforts. 
  • With respect to resiliency, our Resiliency Working Group issued its final report and recommendations in July. Many of the recommendations are related to disaster preparedness, resiliency, recovery and communications. 
  • The hurricanes have illustrated the importance of disaster response and planning for rebuilding, and the Resiliency Working Group will now help ensure NAHB can be a resource and problem solver after a natural disaster. 

3. Electronic Recordkeeping

  • The Occupational Safety and Health Administration’s 2015 electronic reporting rule requires certain employers to electronically submit injury and illness data that they are mandated to keep under existing recordkeeping regulations. 
  • The rule also contains anti-discrimination prohibitions to protect workers who notify an employer of a workrelated injury or illness. 
  • NAHB has concerns about several elements of the rule, including the requirements for employers to submit records electronically to OSHA that would become publicly available.  In January, NAHB and other stakeholders filed a legal challenge. 
  • On May 5, NAHB and other organizations submitted a petition to the Department of Labor (DOL) seeking a stay of implementation and enforcement of the rule, and requested OSHA re-open the rulemaking. 
  • In June, OSHA announced it was extending the filing deadline for employers to submit electronic records to December, which would give OSHA more time to review the rule. 

4. Federal Flood Risk Management Standard

  • In response to the charge led by NAHB and as part of President Trump’s Executive Order to expedite federal approval for infrastructure projects, the Administration revoked Executive Order 13690 and the Federal Flood Risk Management Standard (FFRMS). 
  • Our advocacy efforts included participating in federal listening sessions and meetings; submitting comment letters to federal agencies; and requesting that President Trump revoke it. 
  • This standard would have dramatically expanded regulated floodplain areas. 
  • However, in response to the hurricanes, the Trump Administration may establish its own flood standard. 
  • If the Administration chooses to do so, NAHB will work with the White House to develop an effective standard that does not place undue regulatory burdens on residential construction projects. 

5. Immigration

  • The H-2B Temporary Non-Agricultural Worker program allows employers who cannot find local labor for short-term or seasonal jobs to fill those positions with temporary foreign workers. 
  • There is an annual cap of 66,000 on H-2B visas issued in a fiscal year, but that cap excluded workers who had participated in the program within three years. 
  • That “returning worker exemption” expired in September 2016 and has not been renewed by Congress. 
  • In May, Congress approved a spending package for the remainder of FY 2017 that included language allowing the Department of Homeland Security (DHS) to raise the statutory cap for 2017 to allow additional visas. 
  • In July, DHS announced it would make 15,000 more visas available, but only to employers who could demonstrate that their business would suffer “irreparable harm” without H-2B workers. 
  • The next round of H-2B visas will become available on Oct. 1. NAHB hosted a free webinar to help employers learn if they qualify to apply for H-2B workers and how they can become certified employers under the program. 
  • With Congress and the Administration focused on immigration enforcement, the prospect of creating a new guest worker program to benefit builders and specialty trades is highly unlikely. 
  • NAHB continues to advocate for restoration of the returning worker exemption while looking for opportunities to expand and reform the H-2B program.

6. Low-Income Housing Tax Credit (LIHTC)

  • On Aug. 1, NAHB Chairman Granger MacDonald testified before the Senate Finance Committee on “America’s Affordable Housing Crisis.” The hearing focused on the LIHTC. 
  • Chairman MacDonald also discussed how lots and labor shortages, building material price increases and regulations affect housing affordability.

7. National Flood Insurance Program (NFIP)

  • The NFIP was extended until Dec. 8 as part of a broader legislative package. 
  • During NAHB’s Leg Con in June, builders spoke to their congressional delegations about provisions in the House Financial Services Committee’s flood insurance bill that negatively targeted new construction and grandfathered properties. 
  • NAHB was able to convince the committee’s leadership to remove those provisions. 
  • After Hurricanes Harvey and Irma, discussions about changing the program were put on hold as policymakers ensured home owners and communities had short-term certainty and financial aid. 
  • NAHB will work with Congress on long-term legislation that ensures an affordable, available, predictable and financially stable NFIP.

8. Regulatory Reform

  • President Trump has made regulatory reform one of his top priorities, and has asked each agency to evaluate existing regulations and identify ones that should be repealed, replaced or modified. 
  • We have submitted recommendations to the Environmental Protection Agency (EPA), Department of Housing and Urban Development (HUD), Federal Emergency Management Agency (FEMA), National Marine Fisheries Service (NMFS), Fish and Wildlife Services (FWS), Department of Justice (DOJ) and Department of Energy (DOE), and will soon submit feedback to the Army Corps of Engineers. 
  • NAHB will provide suggestions to DOL, OSHA and others once their notices are published. 
  • We will review the 2017 Fall Regulatory Plan and Agenda upon its release and determine if our suggestions were incorporated. 
  • The Small Business Administration (SBA) Office of Advocacy is also collecting input on regulatory reform through a series of nationwide Regulatory Roundtables; NAHB has had good representation at all roundtables to date. 
  • As part of the Cleveland roundtable, NAHB member George Davis met with SBA officials at one of his construction developments. 
  • NAHB will continue its outreach to HBAs and members as additional roundtables are announced. 
  • On August 28, NAHB testified before the SBA’s Regulatory Fairness Board about the enforcement activities of federal agencies, particularly EPA and OSHA.

9. Overtime Rule

  • Under a new rule that was set to go into effect Dec. 1, 2016, the Obama Administration doubled the annual salary level used to determine whether an employee qualifies for the professional, administrative and executive exemption to overtime eligibility from $23,660 to $47,476. 
  • Under the new rule, the salary threshold would also be automatically adjusted every three years. 
  • NAHB and many other industry groups challenged the rule in federal court. 
  • We contended that DOL went beyond its authority under the Fair Labor Standards Act to allow the salary limit to automatically be re-set every year. The Administrative Procedures Act requires these updates be made through regular notice and comment periods. 
  • In a victory for NAHB, a federal judge in Texas issued a preliminary injunction that temporarily barred the implementation of the rule. 
  • On Aug. 31, the Texas federal court held the rule was invalid and the three-year automatic increase DOL included was similarly unlawful. 
  • DOL’s appeal of the preliminary injunction is now moot and likely to be dismissed.

10. Smart Market Report

  • Preliminary findings from them Green Residential Smart Market Report show that green building activity should increase over the next few years. Approximately 60 percent of surveyed builders expect it to be a significant share of their overall activity by 2022. This is nearly double from 2014, when only 32 percent of firms reported that level of green building. 
  • Single- and multifamily home builders agree that energy efficiency and healthier indoor environments are key factors in building a green home, and have prioritized these elements in the construction process. 
  • The Smart Market report found that ENERGY STAR is more popular in the single-family market while LEED and the National Green Building Standard (NGBS) are more popular with multifamily builders. 
  • The Green Residential Smart Market Report is a biannual report released by NAHB and Dodge Data and Analytics (formerly McGraw Hill). The report reviews the history and future of green home construction in the single-family, multifamily and remodeling sectors.

11. Stormwater

  • NAHB launched an online toolkit in August to help HBAs advocate for programs that provide a clear path to compliance, reduce redundancy and meet water quality goals. 
  • The toolkit provides simple checklists that compare pros and cons of different regulatory approaches based on climate, geography, and local land use patterns. This data will help our members in conversations with state regulators. 
  • As part of the toolkit launch, NAHB released A Developer’s Guide to Post-Construction Stormwater Regulation. This report provides a state-by-state breakdown on the top permitting issues affecting builders.

12. Tax Reform

  • A team of congressional leaders and Administration officials known as the “Gang of Six” is developing a structure for tax reform, while President Trump is trying to garner nationwide support on the issue. 
  • House Speaker Paul Ryan intends to move tax reform this fall. 
  • Before Congress can address tax reform, it must pass a budget resolution to set up the procedural process known as reconciliation. This will allow tax reform to pass the Senate with only 50 votes. 
  • However, there is growing resistance in the House to passing a budget resolution before members see the Gang of 6’s tax framework. To use the reconciliation process, the House and Senate must pass identical budget resolutions, which will be challenging.

13. Waters of the U.S. (WOTUS)

  • On Oct. 11, the U.S. Supreme Court will hear oral arguments on whether the 2015 WOTUS rule should be litigated in federal trial court or the appellate court. 
  • NAHB has argued that challenges to the WOTUS rule must be first heard at the trial court. 
  • We need this clarity so we do not have to file two lawsuits when we challenge an EPA Clean Water Act regulation. 
  • Meanwhile, the EPA plans to use a two-step process to develop a new WOTUS definition. 
  • In the first step, the EPA has proposed to withdraw the 2015 WOTUS Rule and revert to the status quo. We expect the agency to finalize the withdrawal by early 2018. 
  • The EPA also plans to develop a new WOTUS rule, and will soon take comments on the proposal. 
  • NAHB is taking advantage of its unprecedented access to EPA Administrator Scott Pruitt, and is working with the agency on a new rule that is clear and limits jurisdiction of the Clean Water Act consistent with congressional intent. 
  • In August, NAHB and the Dallas Builders Association hosted a meeting with Administrator Pruitt in Dallas to voice concerns and offer insight about the new rule. 
  • NAHB and the Colorado Association of Home Builders are planning a similar meeting with Administrator Pruitt in Colorado Springs in October. 
  • In late October, NAHB will provide recommendations on a revised WOTUS definition at a business-focused in-person listening session at EPA headquarters. 

For more information about these or other Federal government affairs issues, contact Michael Dey (mdey@hbaofgreenville.com).

NAHB: Federal Legislative Priorities for 2012

by | Jan 10, 2012 | Uncategorized

You are a member of your Home Builders Association.  Do you wonder what your association is doing for you in the Federal arena.  2012 is a critical year on the government scene for home builders.  Your National Association of Home Builders has published is priorities for the year and they are listed and detailed below.

Summary

  1. End the Housing Production Credit Crisis
  2. Resolve the Faulty Appraisal Process
  3. Protect the Mortgage Interest Deduction
  4. Maintain Federal Support for Housing Finance System
  5. Preserve Affordable Downpayments and Mortgages
  6. Recognize Housing’s Important Role to the Economy
  7. Defend the Low Income Housing Tax Credit  
Read details about each issue below.
1. End the Housing Production Credit Crisis

It is absolutely vital to get credit flowing to the housing sector again. In the current regulatory climate, lenders have basically stopped making acquisition, development and construction (AD&C) loans that are necessary to allow builders to construct new homes. Credit is the lifeblood of housing. Home builders cannot keep their doors open and create jobs in their communities if they cannot get credit to build even pre-sold homes. And when lenders call in performing loans, everyone suffers. Workers get laid off, sound projects go uncompleted and banks take possession of unfinished property.

Federal bank regulators maintain that they are not encouraging institutions to stop making loans or to indiscriminately liquidate outstanding loans. However, NAHB members who are dealing with banks all across the country suggest that bank examiners in the field are adopting a significantly more aggressive stance on AD&C loans out of fear of the regulators coming into the banks and targeting them.

With inventories of new homes nearly depleted in many markets, builders should be gearing up to meet demand, create new jobs and keep the economic expansion moving forward. The only thing holding builders back in these locations are traditional lenders, who still aren’t providing the credit needed to renew the production process.

NAHB is urging Congress to support legislation introduced on May 5 by Reps. Gary Miller (R-Calif.) and Brad Miller (D-Calif.) that would help restore the flow of credit to the housing sector. H.R. 1755, the Home Construction Lending Regulatory Improvement Act of 2011, offers a legislative solution aimed at ending the freeze in housing production credit that has forced countless home building firms across the nation to shutter their doors, resulting in grave repercussions for job growth and the overall economy.

For more information, see the text of the legislation or read NAHB’s press release.

2. Resolve the Faulty Appraisal Process

Appraisals remain a major problem for the housing industry. The process has gone seriously wrong because some appraisers are using distressed properties – many of which have been neglected and are in poor physical condition – as comparables in assessing the value of brand new homes without accounting for major differences in condition and quality. Without such adjustments, the two are not comparable. Appraisers don’t typically enter these fixer-up homes; if they did, they would likely recognize the substantial differences between a foreclosure that lacks working appliances and a new home fitted with state-of-the-art appliances.

Too often, due to faulty appraisal practices, the builder’s house winds up getting appraised at less than the cost of construction. This is not only unfair and unreasonable, but it perpetuates the cycle of declining home values, drives more home owners underwater, negatively affects housing demand and acts as an obstacle to the recovery of the housing market. Major reforms in appraisal practices and oversight are needed to ensure that appraisals accurately reflect true market values and don’t contribute to price volatility.

For more information on the appraisal issue, see the Nov. 7 special edition of Nation’s Building News.

3. Protect the Mortgage Interest Deduction

Americans overwhelmingly oppose any action by Congress to tamper with the mortgage interest deduction, but it could be eliminated or scaled back as federal lawmakers and the Administration are looking at tax increases in light of deficit concerns.

The consequences would be devastating for home owners, the housing market and the nation’s economy. Any attempts to tamper with the mortgage interest deduction would raise taxes on millions of home buyers and home owners and further depress home values, leaving more home owners with mortgages larger than the value of their property (“underwater”) and fueling even more foreclosures.

This cornerstone of American housing policy has been in place since the inception of the tax code nearly 100 years ago and supports the aspirations of families at all income levels to become home buyers. Nearly 37 million home owners directly benefit from the mortgage interest deduction and 70 percent of the benefit goes to middle-class home owners who make less than $200,000.

Many in Congress agree that tampering with the mortgage interest deduction would harm consumers and the economy. House resolution H. Res. 25 expresses a “sense of Congress that the current federal income tax deduction for interest paid on debt secured by a first or second home should not be further restricted.” The resolution, which has more than 180 cosponsors, shows that lawmakers are aware of the critical role that the MID plays in supporting homeownership in this country. NAHB is encouraging supporters to call the Capitol Switchboard at 202-224-3121 and urge their representatives to co-sponsor H. Res. 25.

To educate the public on the importance of preserving the mortgage interest deduction as a cornerstone of American housing policy, NAHB has created a consumer-oriented website, SaveMyMortgageInterestDeduction.com. The website contains fact sheets, frequently asked questions, statistics, and other important information to allow consumers to stay informed as debate on the mortgage interest deduction moves forward.

Most importantly, SaveMyMortgageInterestDeduction.com tells visitors how to remain engaged and make sure their opinions are heard on this important issue by connecting through NAHB’s Facebook and Twitter mortgage interest deduction communities and Eye on Housing blog.

4. Maintain Federal Support for Housing Finance System

Some members of Congress are actively pushing to abolish Fannie Mae and Freddie Mac and end the federal backstop for housing. Absent a federal role to help reassure mortgage market investors, the 30-year, fixed rate mortgage, the major housing finance tool for most Americans, would become increasingly scarce and much more costly, pricing many creditworthy borrowers out of the marketplace. Similarly, the availability of financing for multifamily housing would fall woefully short of the growing need.

In the wake of the financial crisis, the Federal Housing Administration, Fannie Mae and Freddie Mac have become the primary sources of financing for residential housing.

Even with the current high level of federal support, fewer mortgage products are available now than in the past, and these loans are being underwritten on much more stringent terms. As the private market assumes a greater role in the mortgage marketplace, maintaining an appropriate level of government support is essential to preserve financial stability, promote investor confidence and ensure liquidity and stability for homeownership and rental housing.

Complicating the situation, the federal government is looking to trim back the Federal Housing Administration’s participation in the market, which would further limit the availability of low downpayment mortgages.

Reps. Gary Miller (R-Calif.) and Carolyn McCarthy (D-N.Y.) on July 7 introduced H.R. 2413, the Secondary Market Facility for Residential Mortgages Act of 2011. The bill would stabilize housing and ensure liquidity in the mortgage market by maintaining a federal role in the U.S. housing finance system.
Similar bipartisan legislation (H.R. 1859) introduced this spring by Reps. John Campbell (R-Calif.) and Gary Peters (D-Mich.) would replace Fannie Mae and Freddie Mac with five private companies that would issue mortgage-backed securities and have government backing.
NAHB has presented lawmakers with a detailed proposal on restructuring the housing finance system to provide a consistent supply of mortgage liquidity and retain a federal backstop while limiting taxpayer exposure. Actively involved in this issue, the association continues to encourage all congressional efforts that seek an appropriate federal role to ensure a reliable and adequate flow of affordable housing credit.
Meanwhile, in an important victory for consumers, President Obama on Nov. 18 signed into law legislation passed by Congress to restore higher loan limits through 2013 for mortgages backed by the Federal Housing Administration. Restoring the higher FHA loan limits will help to stabilize home values, provide constancy while private investors re-enter the market and enable millions of creditworthy consumers to get home loans with the best mortgage rates and lowest fees and downpayment requirements.

For more information, click on the links below:

5. Preserve Affordable Downpayments and Mortgages

Six federal agencies are proposing a national Qualified Residential Mortgage (QRM) standard that would require a minimum 20 percent downpayment, which would keep homeownership out of reach of most first-time home buyers and middle-class households.

In addition, the QRM plan includes several other bad ideas that would seriously impact the average family’s ability to affordably obtain a home of their own. It would mandate restrictive debt-to-income ratios to qualify for a home loan and prevent 25 million current home owners from refinancing to lower mortgage rates because they lack the required 25 percent equity in their homes.

High downpayment and equity rules along with excessive underwriting requirements will not have a meaningful impact on default rates but it will tighten lending rules to the point where millions of creditworthy home buyers won’t be able to qualify for a mortgage. Responsible consumers who maintain good credit and seek safe loan products will be forced into more expensive mortgages under the terms of the proposed rule simply because they do not have 20 percent or more in downpayment or equity. In other words, the proposal unfortunately penalizes qualified, low-risk borrowers.

About 62 percent of first mortgages taken out to purchase a home last year would not have qualified under the proposed QRM standard because they had downpayments of less than 20 percent, according to LPS Applied Analytics, a mortgage data firm.

NAHB estimates that it would take 12 years for a typical family to save enough money for a 20 percent downpayment on a median-priced single-family home and other research has found it would take even longer. Borrowers unable to make a 20 percentdownpayment or to obtain FHA financing would be expected to pay a premium of up to two percentage points for a loan in the private market to offset the increased risk to lenders, according to NAHB economists. This would annually disqualify about 5 million potential home buyers, resulting in 250,000 fewer home purchases each year.

If buyers are denied access to affordable housing credit, the shadow inventory of foreclosed homes will not be drawn down, a housing recovery will not take hold and economic growth will stall.

Low-downpayment home loans have been originated safely for decades and did not cause the housing lending crisis. Subprime, no-documentation loans and other alternative mortgage products crashed the economy. The Administration and regulators must acknowledge this fact and offer a new plan that ensures a safe and healthy mortgage market and keeps homeownership affordable for working American families.

For more information on this topic, click on the links below:

6. Recognize Housing’s Important Role to the Economy
As policymakers begin debate on housing finance and budget issues that will impact job creation and future growth, they must understand the important role that housing plays in the U.S. economy. Considering the enormity of the total number of jobs attached to housing, a sector that accounts for 15 percent of the nation’s Gross Domestic Product, now is hardly the time to step back from the nation’s long-standing commitment to homeownership.

Building 100 average single-family homes generates more than 300 jobs and nearly $9 million in taxes and revenue for state, local and federal governments. Perhaps more than any other consumer product, housing is “Made in America.” New homes and apartments don’t arrive in this country on container ships from Europe or Asia, and most of the products used in home construction and remodeling are manufactured here in the United States.

More than 1.4 million residential construction jobs have been lost since April 2006. The pace of recovery is debatable, but based purely on population growth and demographics, the U.S. will need to build 17 million additional homes over the next decade.

The gap between current production and potential housing production is more than 1 million homes. That represents more than 3 million untapped American jobs. This gap is a result of multiple factors, including deferred household formations, a lack of construction financing and flawed appraisal practices under which new homes get compared to distressed and foreclosed properties, thereby distorting true market values.

There can be no economic recovery without a housing recovery. The path forward is perfectly clear: Congress needs to take actions to restore the health of the housing industry to put America back to work.

This is a sentiment shared by American voters as well. A recent NAHB survey of likely 2012 voters conducted by Public Opinion Strategies and Lake Research Partners found that despite the ups and downs of the housing market, home owners and non-owners alike consider owning a home essential to the American Dream and support politicians who embrace pro-housing policies and the mortgage interest deduction.

An overwhelming 75 percent of the respondents said that owning a home is worth the risk of the fluctuations in the market and 73 percent of those who do not own a home say it is a goal of theirs to eventually buy one. Equally telling, more than 70 percent of voters believe the federal government should provide tax incentives to promote homeownership and oppose proposals to eliminate the mortgage interest deduction — a sentiment that cuts across party lines.
As Congress looks at tax expenditures and all programs come under review, it is important to protect the Low Income Housing Tax Credit (LIHTC), the most successful affordable rental housing production program in U.S. history. Eliminating the LIHTC would bring production and rehabilitation of affordable rental housing to a standstill.
Since its inception, the program has made possible the production of more than 2 million affordable apartments. It creates approximately 95,000 new full-time jobs, adds $7.1 billion in income to the economy and generates approximately $2.8 billion in federal, state and local taxes each year. In recent years, the LIHTC has produced about 75,000 new apartment homes annually.
The demand for affordable housing is acute and far exceeds the ability of LIHTC projects to keep pace. The program is essential to address the shortage of affordable housing options in our cities and towns.