| October 6, 2008 |
By Sandy Dunn
NAHB Chairman and
Jerry Howard
NAHB Executive VP and CEO |
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Congress passed an emergency financial sector rescue plan
on Oct. 3 that should greatly alleviate the ongoing meltdown in banking and credit markets, and President Bush signed the measure into law immediately thereafter. NAHB stood strongly in support of the plan following a special session of our Board of Directors in San Diego last week.
 With credit markets frozen and the economy unraveling at an alarming rate, the nation's home builders called on Congress to enact the rescue plan immediately in order to stabilize worldwide financial markets. Realizing the need for prompt action, NAHB's Board of Directors held an emergency session on Wednesday, Sept. 24 in San Diego, prior to the official Fall Board meeting on Sept. 26. At that session, the board unanimously agreed to support the proposed legislation. A phone bank was set up outside the Board room to facilitate member calls to their senators and congressmen, and all of NAHB's 235,000 members were asked to immediately contact their federal respresentatives as well to urge their immediate adoption of the plan. In a statement released the day of the special board session, NAHB Chairman Sandy Dunn said, "We agree with Fed Chairman Bernanke and Treasury Secretary Paulson that immediate steps need to be taken to stem the financial crisis. The financial markets are in turmoil and the flow of credit has been severely curtailed for housing and other sectors of the economy. There's no time to waste – Congress must pass legislation as soon as possible."
In a second statement issued just prior to the Senate's passage of a revised rescue plan on Oct. 1, Sandy noted that "Falling home prices, mounting foreclosures and a frozen credit market have taken a severe toll on the nation's economy. As the financial markets struggle, mortgage credit costs are increasing and home builders are finding it more and more difficult to obtain any business credit. By providing a market for troubled mortgage assets, the financial rescue package will restore confidence in global financial markets and allow creditworthy home buyers, builders and other small businesses access to credit. It's time to set aside politics, self-serving interests and ideology and unite as Americans in support of this legislation." With the House's approval of the rescue plan secured on Oct. 3 and President Bush poised to sign the measure into law right after, NAHB sent out another reaction statement praising that action. Get more information on the rescue plan and related NAHB actions in the Oct. 6 edition of NBN Online.
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Fire sprinkler mandates will be part of the 2009 IRC
and will be required in all one- and two-family homes that build to the code as of Jan. 1, 2011 (and in townhouses immediately upon adoption of the code) after a disheartening outcome at the International Code Council's Final Action Hearings in Minneapolis two weeks ago. The sudden arrival of 900 fire officials elgible to vote at the ICC hearings swelled the number of sprinkler proponents, and the measure was overwhelmingly appoved by a vote of 1,283 to 470 on Sept. 21. These mandates will provide a sizable financial boon for the fire sprinkler manufacturing industry, which, like NAHB, helped provide funding for building officials to attend the hearings. NAHB had identified several concerns regarding mandated systems, including the question of whether most home owners are prepared to perform the maintenance required to ensure that the sprinklers remain operational. Builders have also cited the potential for pipes installed in attics to freeze in colder climates and have cautioned that the sprinklers can be discharged accidentally, with damaging results. In areas served by wells or where water is scarce, the availability of an adequate water supply is another possible problem. Meanwhile, existing code requirements, including hard-wired interconnected smoke alarms, have contributed to a significant decline in fire-related deaths and injuries over the past 30 years. At this time, the issue moves to the state and local front, where NAHB will help its HBAs with needed resources to combat the adoption of mandated sprinklers in individual jurisdictions.
On the flip side of the coin, voting ICC members disapproved the so-called "30% solution" from a coalition of insulation and window manufacturers that would have significantly revised the International Energy Conservation Code. Votes were also split on a number of wall bracing provisions. Read details of the code hearing decisions in NBN Online, or contact Larry Brown, x8565 for more information.
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The FHA's new Hope for Homeowners program,
 initiated on Oct. 1, was welcomed by NAHB as a means for insuring new, more affordable mortgages for homeowners who are struggling with burdensome payments on their current home loans. Getting this program up and running by the October 1st deadline was crucial to stemming the rising tide of mortgage foreclosures that has been adding to the inventory of unsold homes and undermining home prices, said NAHB in an official statement. Under the program, the holder of a troubled mortgage must agree to accept, as payment-in-full, an amount equal to 87% of the current value of the mortgaged property. The borrower then receives a new, FHA-insured mortgage that represents 90% of the home's current value, with the 3% balance going to cover the borrower's upfront FHA mortgage insurance premium. The homeowner is then responsible for an annual mortgage insurance premium of 1.5%. Eligible borrowers must meet a mortgage payment-to-income test and agree to share equity gains on their home with the federal government. Recently enacted housing stimulus legislation, called the Housing and Economic Recovery Act of 2008, provided FHA with an additional $300 billion in mortgage insurance authority to operate the new program for the next three years. Read NAHB's statement of approval online, or contact Dave Ledford for details at x8265.
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Our 2009 IBS Grand Opening Ceremonies keynote speaker is...
 legendary football coach Lou Holtz! The only coach in history to take six different college teams to a bowl game, Holtz is a West Virginia native who started his head coaching career at the College of William & Mary, followed by the University of Minnesota, University of Arkansas, North Carolina State University and Notre Dame; he was also head coach for the NFL's New York Jets for one season. While at Notre Dame, he turned a struggling team into one with the longest winning streak in the school's history. After that, he joined CBS Sports' College Football Today for two seasons before returning to a head coaching position at the University of South Carolina. He's now a college football analyst on ESPN, and earlier this year was named to the College Football Hall of Fame. Holtz will speak during opening ceremonies for the 2009 International Builders' Show in Las Vegas on January 20. Read more in our press release, or visit the www.buildersshow.com site for more information on the IBS.
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A Spanish-language version of NAHB's popular Web site
 pertaining to the newly instituted $7,500 first-time home buyer tax credit has just been launched. NAHB first went live with its FederalHousingTaxCredit Web site shortly before the Housing and Economic Recovery Act of 2008 was signed into law on July 30. This site, which explains eligibility requirements and answers frequently asked questions on the tax credit, has attracted more than 420,000 unique visitors to date. Now there is even more reason for potential home buyers to visit – a Spanish-language version of the site, which is available by following the link at the top of the original site's home page. Check it out and spread the word about this great resource, which we believe is the only Web site on the Internet devoted solely to providing information about the tax credit. Contact: Jay Shackford, x8406.
Another great resource for promoting the tax credit is NAHB's newly created Public Service Announcement TV spot. NAHB members and HBAs can request a copy of the PSA in Beta SP or DVD format for use with local cable television channels by e-mailing David Falcone in NAHB's Production Group. Requests will be fulfilled on a weekly basis, and tapes/DVDs will be sent by U.S. mail. Please allow sufficient time for processing. To get more information about PSAs and advice on how to convince your local media to use them, read the PSA section in the NAHB Public Relations Toolkit or contact Gwyn Donohue, x8447.
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Proposed RESPA changes are a bad idea,
NAHB told Congress on Sept. 16. Testifying on NAHB's behalf before the House Subcommittee on Oversight and Investigations, Debra Still, president and CEO of Pulte Mortgage LLC, warned lawmakers that HUD's proposal to amend the Real Estate Settlement Procedures Act (RESPA) "would result in significant increases in home purchase costs and undermine critical financing support at a time of severe mortgage and housing market turbulence." At issue is an attempt to alter the definition of "required use," which would prohibit a home builder from offering any incentive in exchange for a home buyer's use of the builder's affiliated mortgage or title companies or any other affiliated business. Home building companies have formed such entities primarily to offer consumers better financing choices and improve the likelihood of the home sale closing taking place in a timely manner. Over the last year when mortgage financing conditions have become unstable and uncertain, such relationships have taken on greater significance, Still noted. She also pointed out that HUD has failed to provide any empirical studies to validate its position that consumers are harmed by using builder affiliated service providers, and said that "free and open competition among service providers would result in the greatest benefit for consumers who are purchasing new homes." Read NAHB's press release for details, or contact Bill Renner, x8597.
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NAHB's newly updated Impact Fee Handbook
 is a free online resource that's designed to help NAHB members and HBAs to negotiate or fight impact fees in their communities. The 133-page publication, which can be downloaded in PDF format, offers new ways to analyze impact fee methodologies and ordinances, and highlights the most common mistakes after ordinances are passed. With many local governments now turning to impact fees as a financing tool in the face of increased budgetary constraints and rising demand for services, this updated resource is a timely and useful tool. Other information within the handbook includes the latest economic and legal data and public affairs strategies that builders and developers can employ to address proposed fees. Download the Impact Fee Handbook from our Web site or get other general infrastructure financing resources at www.nahb.org/infrastructurefinance. Contact: Thais Austin, x8343.
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Bad news on Effluent Limitation Guidelines (ELGs)
arrived just before our Fall Board of Directors meeting, when the Ninth Circuit Court of Appeals ruled against the EPA in a lawsuit brought against the agency for its 2004 decision to not issue ELGs for the construction and development industry. NAHB and the Associated General Contractors had intervened on EPA's side to defend the "no rule" decision, which was issued after the agency determined that the sediment running off construction sites in storm water is not a "toxic or unconventional" pollutant, unlike some discharges from industrial plants or other sources. The court's ruling was not a surprise to NAHB, and we have already been working with the EPA to help devise ELGs that are technology-based rather than numerical. NAHB is also participating in a U.S. Small Business Administration panel that is studying the financial implications of ELG regulations for smaller builders and developers. The panel is expected to complete its work well before the court-mandated deadline for EPA to issue ELGs by Dec. 1, 2009. Read more on this subject in NBN Online, or read the Ninth Circuit's decision online. Contact: Calli Schmidt, x8132.
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NAHB's Quick Issues Index
 documenting the latest advances on our top Advocacy issues was updated for the Fall Board of Directors meeting in San Diego, and is now available to you online. This document is meant to give you a quick summation of issues on which there has been recent movement, as well as directions on where to go for more information. It is viewable by members only (note: you must be logged onto the NAHB Web site with your username and password) at www.nahb.org/issuesindex. Contact: Samantha Silver (x8450).
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Plan to attend the NAHB Fall Construction Forecast Conference
 on Wednesday, Oct. 22 in Washington, DC to hear what the country's foremost economists have to say about prospects for stabilization in our industry, regional trends, the ongoing turmoil in financial markets, and more. Panels of nationally recognized experts will discuss economic trends, government policies (including the recent takeover of Fannie Mae and Freddie Mac) and results from recent NAHB surveys as part of this day-long super seminar. Even if you can't make the trip to Washington, be sure to sign up for our live Webcast, which gives you unlimited access to the conference video for three months and electronic copies of the presentation material. Register to attend the conference in person or via Webcast at www.nahb.org/CFC. Contact: Drew Williams, x8196.
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Apply for an NAHB SAFE award by Oct. 13
and get the recognition you deserve for your outstanding worksite safety efforts. The Safety Award For Excellence (SAFE) honors the achievements of builders and trade contractors who have put in place high-quality construction safety programs, as well as government officials and NAHB-affiliated associations who have successfully advanced safety in the home building industry. Last year, a total of 14 companies were honored for their safety achievements, and this year, your firm could be among the winners! But remember, applications are due by Oct. 13! Read more about eligibility requirements for this important award and get an online application at www.nahb.org/SAFE. Contact: Lindsay Cather, x8163.
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