Biztools™ Model to Assist You with Your Finances
Are your numbers what they should be? Find out with these tools to help you with your Income Statement & Balance Sheet

All entrepreneurs, even small builders, need to be on top of their company’s finances. NAHB has just made it easier for you to do that with a new Builder’s Financial Document Tool.

The tool is a downloadable Excel model, including three helpful worksheet components that will help you calculate key financial data about your company. Each page of the model’s workbook deals with a different financial statement or issue that you need to take into consideration when evaluating your company, including:

• The Income Statement—a statement of profit (or loss) for a company in a given period of time. This document comprises a company’s revenues, less expenses, for a particular period. It determines how profitable your company is over a given period of time.
• A Balance Sheet, which is a statement of the financial position of a company at a particular point in time.
• Ratio Review is a list of Financial Ratios that relate to your company. Financial ratios restate accounting data in relative terms so that you can identify the strengths and weaknesses of your company.

Go to www.nahb.org/biztools now and log in as an NAHB member to download your copy of the Builder’s Financial Document Tool! Getting started with the model is easy. All you need to take advantage of this tool is NAHB’s Chart of Accounts and your company’s financial numbers. Make use of this fast, simple way of managing your books today! Then see how your company’s performance measured up to the rest of the industry by comparing your numbers to those in The Cost of Doing Business Study.

NAHB's Efforts Improve New Tax Deduction Regulations
By Robert Dietz
The Department of the Treasury’s recently published final regulations for the Section 199 domestic production activities tax deduction (part of the American Jobs Creation Act of 2004) include a number of favorable changes for the construction industry, including residential builders.

The domestic production activities deduction reduces tax liability for businesses, including home-building businesses, which manufacture goods or construct property in the United States.

For tax year 2006, the deduction is equal to 3% of a business’s qualified production activities income (QPAI). The percentage will rise from 3% to 6% for tax years 2007, 2008, and 2009, and then increase to 9% for tax years after 2009.

QPAI is equal to the excess of qualified domestic production gross receipts (DPGR) over the sum of business expenses associated with these receipts. Thus, the greater the receipts that are included in DPGR, the greater the tax benefit to the builder.

DPGR is the taxpayer’s gross receipts derived from any lease, rental, license, sale, exchange, or other disposition of qualifying property that was manufactured, produced, grown, or extracted within the United States. Of particular interest to builders, DPGR includes construction, engineering and architectural services performed for domestic construction projects. The deduction is limited to 50% of wages paid by the taxpayer for qualified Section 199 activities. 

Preliminary federal guidance for the Section 199 deduction , published last year, had presented obstacles for builders. In response, NAHB and several coalitions of home builders submitted comments to the Department of the Treasury, resulting in significant improvements to the final regulations. Read more. [return to top]

Why You Should Be Concerned About Workplace Harassment
By Betty S.W. Graumlich and Lee Ann Anderson

As a business owner with employees, you have potential liability under federal and/or state law for a variety of forms of workplace harassment. You may think—“this can’t happen to me.” Well, it can.

According to the latest statistics maintained by the U.S. Equal Employment Opportunity Commission, more than 50,000 charges of sexual harassment were filed between 2002 and 2005. More important, it is not just sexual harassment charges that you need to worry about. Your employees are capable of creating a hostile work environment based on sex, race, disability, national origin or religion unless you set the right tone and consistently condemn any form of harassment.

The cost is overwhelming, and the numbers are staggering—and growing.

In 2003, employees in the U.S. filed 13,566 charges of sexual harassment, 4,906 charges of gender harassment, 6,180 charges of racial harassment and 2,365 charges of national origin harassment with the EEOC. From 1985 to 2000, the percentage of harassment charges filed, as compared to all EEOC charges filed, rose from 0 percent to 18.8 percent.

Read this article, revised and reprinted, with permission, from the May 2006 issue of Virginia Builder, to learn how to protect your business. [return to top]

Creating Company-wide Environmental Programs Just Got Easier
The NAHB Environmental Management System (EMS) is the first tool of its kind for the home building industry. It will help you better comply with U.S. Army Corps of Engineers and EPA regulations—particularly those regarding storm water permits. Designed for medium- to large-sized firms, the EMS tool, which can be ordered online, includes a CD and detailed book of instructions. A Microsoft Excel spreadsheet allows home builders to prioritize potential environmental issues they may have to address, ranked according to impact or importance.

NAHB will offer a seminar to introduce the tool this fall,  followed by a class at the 2007 International Builders’ Show.

Order your EMS tool online, or contact Delecia Jenkins at x8163. [return to top]

Some Areas Continue Housing Growth During Cool Down
While nationally the housing market is gradually cooling, some states continue to show growth, according to the National Association of Home Builders’ (NAHB) State Housing Starts Forecast. The report, available at http://www.nahb.org/generic.aspx?sectionID=728, analyzes the regional health of the economy and housing sector, and provides state-by-state forecasts.

“We are coming off a very strong couple of years for the housing industry and markets are now starting to cool to more sustainable levels,” said David Seiders, chief economist of the National Association of Home Builders (NAHB). “Each market has different factors that affect its local economy and housing market, but overall we are forecasting an orderly slowdown in housing starts.”

The report examines the performance of the local economy of each state, measured partly by employment figures. The Bureau of Labor Statistics reports strong job gains in many of the fastest-growing states, with 37 states exceeding their pre-recession peak levels of employment in 2005. As a result of Hurricane Katrina, Louisiana fell significantly below its pre-recession peak, having lost more than 200,000 jobs. In addition to Louisiana, the states with the largest gaps to overcome include Illinois, Massachusetts, Michigan and Ohio. The economic outlook for both the South and the West is bright as they will continue to build upon their industry sector strengths. California, however, faces the problem of high housing prices and an overall high cost of living. These will act as a drag on the overall positive outlook for the state.

Nationally, housing prices increased by 13.2 percent in 2005, with the strongest gains primarily in states along the East and West coasts. Much slower price increases are forecast nationally in both 2006 and 2007. While housing starts are expected to decline nationally, Idaho, North Carolina, Oklahoma, Washington, and Wyoming are all expected to see their total starts increase in 2006.

The effects of the 2005 hurricane season are still being felt in several states. As a neighboring state to storm-damaged areas, Texas received a large influx of evacuees. This will spur multifamily housing starts in 2006 and an even bigger jump in construction activity in 2007. While the rebuilding and repair process is proceeding slowly in Louisiana and Mississippi, the pace is expected to pick up in 2007. 

For more information on this report as well as more in-depth analysis, key data, and housing forecasts, subscribe to the Executive Level of HousingEconomics.com, NAHB’s economics publication for America’s housing industry. [return to top]

Custom Builder Symposium Registration Now Open
Mark your calendar now for the Custom Builder Symposium, Oct. 27-29, 2006 at the spectacular Hyatt Regency Lake Las Vegas Resort in Nevada.

With world-class education, fabulous networking events, and a practical take-home workbook packed with tips on marketing, management, and customer service, the Custom Builder Symposium is a can't-miss opportunity for custom builders to learn from peers who build high-end homes for demanding customers.

“It will not teach you how to pour concrete any better than you already do or teach you how to plumb cut a rafter, but it will teach you how to put money to your bottom line,” says enthusiastic Custom Builder Symposium attendee and NAHB Custom Home Builder Committee Chair Dave Stormont, Stormont Co., Inc., of Kitty Hawk, N.C.

Go online to www.nahb.org/custom to register for the 2006 Custom Builder Symposium now and look for more details about the program. [return to top]

Apply for the Custom Home Builder of the Year Award
Are you a master at transforming client wish lists into one-of-a-kind homes that complement both lifestyle and surroundings? Do you have a gift for acquiring that sought-after material or craftsman that will transform a room into a special experience? Do you know the thrill of a “first” in home building?

If your answers are, “yes,” “yes” and, “I absolutely want to,” then you should apply for NAHB’s newest award, the NAHB Custom Home Builder of the Year Award. 

Sponsored by Dryvit Systems, Inc., the award recognizes the best of the best in a unique segment of the home building industry—those who craft exceptional custom homes for discerning clients and are leaders in the industry and their community.

Award winners will be honored during the 2006 Custom Builder Symposium, Oct. 27-29, at the Hyatt Regency Lake Las Vegas Resort. To learn more about the award and to apply, click here. To register for the symposium, click here. [return to top]

Rave Reviews for NAHB’s Spokesperson Training
“Insightful, gripping, and fast-paced.” “Awesome.” “Loved it!” “Excellent.”

These aren’t reviews for the latest summer blockbuster—it’s feedback from recent participants in NAHB’s Spokesperson Training seminars. One attendee even said it was the best eight hours of education he had spent—ever!

Spokesperson Training will be available once more at NAHB’s Fall Board meeting in Salt Lake City. Registration is open, so sign up today!

Spokesperson Training Seminars help NAHB leaders become more persuasive and effective in all communication environments, and in particular, in media interviews and during speeches and other presentations. They are led by professional communication consultants, each with more than 30 years of experience training NAHB members on the issues that home builders, HBA staff and affiliate members face every day. 

Wednesday’s Interview Skills seminar will help participants master strategies for broadcast and print interviews, including message development.  The 7½ hour seminar is limited to 12 participants and includes instruction, skill-building exercises and on-camera practice interviews/presentations.

The registration fee is $475.00 per person for each one-day seminar. Registrations are accepted on a first-come, first-served basis. To reserve your space, contact NAHB Public Affairs, at (800) 368-5242, ext. 8061, or email nclark@nahb.com. [return to top]

Help NAHB Improve Grassroots Advocacy Efforts
NAHB’s 225,000 members are its greatest asset, and we need to be sure we’re doing the best we can to reach out and encourage involvement of the masses during the current election year and beyond. We want to know about the hot topics that most interest you, so please log on as a member to the NAHB Web site (http://www.nahb.org/) and take the online survey! [return to top]

ESL Tool for Construction Workers
The Home Builders Edition of Sed de Saber™ (“Thirst for Knowledge”)  is coming. This English as a Second Language (ESL) learning tool specifically aimed at the residential construction industry is the outcome of a partnership with Retention Education, LLC.

It includes seven self-paced interactive lessons that teach workers 500 vocabulary words and more than 340 phrases commonly used in home building.

The tool couldn’t be more timely—with an estimated 2.4 million Hispanic workers fueling the nation's home building industry, it represents an enormous opportunity for recruiting and retaining skilled workers while fortifying business relationships, increasing efficiency and employee loyalty, and promoting jobsite safety. HBI Chairman Michael Sivage calls it “a breakthrough ESL tool that offers our industry a tailor-made solution to language barriers typically found on residential construction jobsites nationwide.”

HBI is currently accepting pre-orders for the kits, at $395 each, with expected delivery in February 2007. For more information, contact Ashley Mills at 800-795-7955, x8926. [return to top]

Workforce Housing Awards Entries Due
NAHB is now accepting entries for the Innovations in Workforce Housing Awards (IWHA) recognizing outstanding examples of workforce housing communities across the nation that provide decent and affordable homes for nurses, police officers, schoolteachers, retail workers, and other workers, near areas in which they work

The awards also serve to increase awareness of the workforce housing challenge and the ground-breaking solutions implemented by the housing industry, while encouraging builders, developers and related professionals to incorporate such innovative solutions into their own projects.

“These awards bring national attention to the workforce housing problem and to the creative ways in which builders and developers are increasing the supply of housing that is affordable to working families,” said NAHB President David Pressly.

IWHA is open to builders, architects, designers, developers and land planners nationwide. Communities that have been completed, or in which the first model has been opened or the first unit has been occupied between Jan. 1, 2003, and Oct. 27, 2006, are eligible to enter.

Entries must be postmarked by Oct. 27.

Winning entries will be selected by a panel of builders, multifamily and land development experts, and other industry professionals. Winners will be announced at the 2007 International Builders’ Show in Orlando in February.

For specific entry guidelines and an entry form, click here.

For more information on the awards, click here; or e-mail Blake Smith at NAHB, or call him at 800-368-5242 x8583. [return to top]

GM Vehicles Qualify for New Tax Credit
Several 2006 and 2007 General Motors vehicles qualify for the alternative motor vehicle tax credit that is part of the Energy Policy Act of 2005. The tax credit for hybrid vehicles applies to new vehicles placed in service on or after Jan. 1, 2006.

That means you can reduce your gas consumption, help the environment, enjoy NAHB’s member advantage $500 discount, and get a tax deduction too!

Many currently available hybrid vehicles may qualify for this new tax credit. However, consumers seeking the credit may want to buy early since the full credit is only available for a limited quantity of vehicles sold by a manufacturer to retail dealers. Taxpayers may claim the full amount of the allowable credit up to the end of the first calendar quarter after the quarter in which the manufacturer records its sale of the 60,000th vehicle. For the second and third calendar quarters after the quarter in which the 60,000th vehicle is sold, taxpayers may claim 50 percent of the credit. For the fourth and fifth calendar quarters, taxpayers may claim 25 percent of the credit. No credit is allowed after the fifth quarter.

For more information and a complete listing of all qualified hybrid vehicles, visit www.irs.gov.

For more information on NAHB’s affinity programs, including GM discounts, e-mail Tiffany Smith at NAHB, or call her at 800-368-5242 x8273. [return to top]

Temporary Change of Address for Some IRS Documents
IRS officials have announced a temporary change of address for the delivery of taxpayer requests for rulings, requests for determination letters, Applications for Change in Accounting Method (Form 3115), and similar hand-delivered requests.

Until further notice, these requests and applications should be delivered to the IRS offices at 950 L'Enfant Plaza, 5th Floor, Washington, DC 20024. 

Complaints, subpoenas, or any other service of process, as well as public comments on published guidance, such as proposed regulations, which normally would be delivered to the main IRS Headquarters Building, should also temporarily be delivered to this same address.

The headquarters building was closed after flooding in late June.

In addition to the temporary address change, IRS has established a special procedure for processing requests for certain expedited letter rulings for reorganizations and section 355 distributions.        

Rather than faxing a copy of the requests to 202-622-7707 as described in Revenue Procedures 2005-68 and 2006-1, taxpayers or their representatives should call the office of the Associate Chief Counsel (Corporate) at 202-283-7930 and ask to speak to an attorney regarding the temporary procedures for submitting these ruling requests.

For more information, go online to www.irs.gov. [return to top]