September 26, 2006

 
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NAHB Works to Soften the Blow of New Lumber Pact
Five days after U.S. Trade Representative Susan Schwab and Canadian Trade Minister David Emerson signed a softwood lumber accord establishing a complex system of quotas and new tariffs artificially boosting prices during periods of normal or weak demand for the building material, NAHB formally instituted new policy to help builders once the pact goes into effect.

On Sept. 17, the NAHB Board of Directors approved a resolution during its fall meeting in Salt Lake City that calls on the association to “work with the U.S. government, governments of other countries and industry to promote additional opportunities for NAHB members to obtain access to high-quality, stable and affordable supplies of lumber and other key building materials.” The resolution also calls on the U.S. Congress and the Bush Administration to eliminate all artificial economic trade barriers that discourage the use of imported or alternative building materials in the marketplace and urges NAHB to investigate how it can help builders access new technologies, innovations in home construction and alternative building materials that will provide consumers with more affordable housing. This new policy will supplement NAHB’s long-standing efforts to expand domestic timber supply.

To implement the new policy, NAHB is working to increase imports from Europe. Next month, NAHB Immediate Past President David Wilson and Executive Vice President Jerry Howard will travel to Russia to meet with industry representatives, establish contacts with producers and identify any policy barriers to increasing the volume of imports from their current level. A similar trade mission is planned later this fall to Sweden. In addition, the NAHB Research Center is promoting the use of steel, cement, engineered wood products and other alternative building materials wherever practical.

The new seven-year lumber pact, which is expected to be ratified by the Canadian parliament shortly and take effect as early as next month, would subject Canadian imports to a combination of export taxes ranging from 5%-15% and volume limits when prices fall below $355 per 1,000 board feet. If the pact were in effect today, Canadian lumber producers would be paying duties of 15% — the maximum stipulated — because current prices are well below the $315 per 1,000 board feet threshold that is part of the complicated system of export taxes and quotas based on market prices. For more information, e-mail Jenna Morgan Hamilton or call her at 800-368-5242, x8407.

Lawmakers Hold Hearings on Tax Reform
The Senate Finance Committee last week held the second in a series of hearings on tax reform. The hearing focused on how to improve the current tax system by reducing complexity, increasing competitiveness and promoting "sensible" tax policy.  Witnesses representing the business community generally agreed that lower rates were preferable to tax preferences like expensing.  They also expressed concerns about the process of tax reform, particularly relating to the transition costs associated with radical changes in the tax code. 

Ranking Member Max Baucus (D-MT) suggested that the right approach to tax reform would be to follow the model used by former President Ronald Reagan to address Social Security reform in which a bipartisan, congressionally appointed task force came up with a plan that was then agreed to by both political parties.  Rep. Frank Wolf (R-VA) and Senator George Voinovich (R-OH) have introduced legislation (H.R. 5552/S. 3491) along these lines in both chambers that would reform both the nation's tax system and federal entitlement programs.

Congressional hearings on tax reform continue this week when the House Ways and Means Committee hosts a hearing on congressional tax reform proposals introduced in the 109th Congress.  NAHB continues to monitor these discussions, weighing in where appropriate. To view the tax bills, click here and type the respective bill numbers in the box in the center screen. For more information, e-mail Greg Brown or call him at 800-368-5242 x8421. [return to top]

House Acts on Border Security
The House and Senate are continuing to move forward with several border security bills, as lawmakers from both chambers seek to address some component of the immigration issue prior to adjourning at the end of this week to campaign for the November elections.  The House on Sept. 14 passed HR 6061, the “Secure Fence Act,” by a vote of 283-138.  The Senate this week is expected to consider the measure, which would authorize the construction of 700 miles of fencing along the U.S.-Mexican border. 

The House also approved several other bills last week:  H.R. 4830, which would prohibit the unauthorized construction or use of a tunnel or subterranean passageway between the U.S. and another country;  H.R. 6094,  which would restore the Secretary of Homeland Security's authority to detain dangerous aliens, to deport criminal aliens and combat alien gang crime; and H.R. 6095, which would affirm the inherent authority of state and local law enforcement to assist in the enforcement of immigration laws, to provide for effective prosecution of alien smugglers and to reform immigration litigation procedures.  It is unknown whether the Senate will consider these bills prior to adjourning for the October recess.

None of the legislation scheduled for consideration in the House and Senate contains provisions other than those targeted specifically toward border enforcement and border security.  Further, it is not expected that the House and Senate will be able to reach an agreement on any type of guest worker or illegal immigrant visa provisions this year. To view the legislation, click here and type the respective bill number in the box in the center screen. For more information, e-mail Jenna Morgan Hamilton or call her at 800-368-5242, x8407. [return to top]

For more information or to contact us directly, please visit www.NAHB.org l ©2006, National Association of Home Builders

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