Home Builders Public Policy Post April 2012 Welcome to the NABA Home Builders Public Policy Post. This is a monthly update for NABA members on regulatory and legislative issues facing the housing industry whether it is local, state or national. If you are interested in contributing to the update, we are looking for members who are interested in attending and reporting back about local zoning and county board meetings. Please contact the NABA office at 715.259.3486 or naba@centurytel.net for details. Local Issues Shoreland Zoning Changes in Effect A state law signed April 2 by Gov. Scott Walker will affect local shoreland protection rules, effectively abolishing rules that were just revised by the Sawyer County Board last year. The law, Act 170 (Senate Bill 472), states that no county shoreland ordinance can be stricter than the standards set forth in NR 115 of the state administrative code. The new law became effective April 16. Counties will have until 2014 to complete their rule changes to comply with the new law. The non-conforming structures portion of the new law is in effect now. Sawyer County Zoning Administrator Dale Olson said a committee would be convened to change the county’s rules to conform to Act 170. The process will include input from the towns and will take an estimated two months. For more information on this new law as well as others passed in the last legislative session, please visit www.northlandareabuilders.com/?110260 to download the Legislative Recap sent to members in late March. State Issues Limited Changes Ordered in Redistricting Maps A recent decision by a three member panel of judges has approved the legislative and congressional districts that Republicans drew in 2011. These new district maps will now be in place for the next decade, and will be in effect for November’s elections. The only changes mandated by the judges were to Assembly Districts 8 & 9 in Milwaukee’s south side. Governor signs DNR Regulatory Reform Governor Scott Walker signed Senate Bill 326 into law recently, the DNR Regulatory Reform Bill. Highlights of the DNR Regulatory Reform Bill include: Allows an entity to engage in a land grading activity that is authorized under a stormwater discharge permit or under a permit issued by a county under a shoreland zoning ordinance. In other words, this provision allows an applicant to only have to apply for one permit to do land grading work.
Home Builder Public Policy Post: April 2012
Page 1
Presumptive approval of Chapter 30 (water permits) if the DNR does not approve the permit in a certain period of time The DNR can only ask for more information of an applicant applying for a Chapter 30 permit and not multiple times. This will prevent the DNR from “timing out” an applicant, which we have heard from members in the past. Those who own a property that contain a boathouse will have ability to remodel boathouses that were in existence on December 16, 1979. In the past, remodeling of these structures was forbidden. Requires the DNR to publish on its website site any determination that it makes that a waterway is navigable or not navigable, any determination that it makes that identifies the ordinary high−water mark of a navigable water, and, to the greatest extent possible, the current status of any application filed with DNR for a permit, license, or other approval relating to navigable waters or the environment
NAHB to WI for Housing Rally A number of members from across the state have inquired as to the possibility of Wisconsin hosting a “Rally on Housing” to help bring attention to housing issues and target currently elected officials and those running for office. NAHB hosted one of these rallies in South Carolina leading up to that state’s presidential primary. NAHB officials are very interested in replicating the rally concept in South Carolina in Wisconsin and are targeting a date in advance of the fall primary date (August 14). As more information and planning come to light, we will be updating you on this exciting opportunity! National Issues Sackett Supreme Court Decision a Victory for Property Rights A unanimous decision handed down by the U.S. Supreme Court this week is a huge victory for property rights advocates and very good news for NAHB's members. In Sackett v. U.S. Environmental Protection Agency, the high court agreed with NAHB arguments (submitted in the form of two amicus briefs) that a property owner who receives a Compliance Order from the EPA or Army Corps of Engineers should be able to obtain judicial review in court. The case involved property owners Michael and Chantell Sackett, who owned an undeveloped half-acre lot in a residential area near Priest Lake, Idaho. When the Sacketts began the process of building their dream home by preparing the lot for development, the EPA accused them of placing fill material into a jurisdictional wetland and issued a Compliance Order requiring them to immediately remove that material and restore the wetland -- or face thousands of dollars in fines for every day they did not do so. When the EPA denied the Sacketts' request for an administrative hearing to challenge the order, they filed an action in district court seeking relief, but both the district court and the Court of Appeals for the Ninth Circuit held that the Clean Water Act (CWA) precluded pre-enforcement judicial review of administrative compliance orders. On March 21, every member of the U.S. Supreme Court was in agreement in deciding that "there is no reason to think that the Clean Water Act was uniquely designed to enable the strong-arming of regulated parties into 'voluntary compliance' without judicial review."
Home Builder Public Policy Post: April 2012
Page 2
Moreover, two of the Justices (Ginsburg and Alito) wrote concurring opinions in which they explained that because the EPA had determined its jurisdiction over the Sacketts' property, judicial review was appropriate. This decision is extremely important to our industry because home builders (like the Sacketts) are often subject to Administrative Compliance Orders with no means to challenge them, unless the government decides to file an enforcement action or the builder applies for and is denied a CWA Section 404 permit. As of now, this is no longer the case. Instead, any builder who receives a CWA Compliance Order can now challenge that order in federal court. In addition, whereas builders have previously had no place to turn when the EPA or Army Corps determines that a wetland or water body on their property falls under the agency's jurisdiction, Justices Ginsburg and Alito have now indicated that they may in fact seek relief in court. OSHA Revises Hazard Communication Standard Newly announced changes to OSHA's Communication Standard require that employers or users of hazardous chemicals such as adhesives, sealants, paints and coatings, solvents and lubricants must now update safety data sheets when new ones become available, provide training on the new labeling requirements and update their hazard communication programs if new hazards are identified. The changes effectively align the Hazard Communication Standard -- or HAZCOM -- with the United Nations' Globally Harmonized System of Classification and Labeling of Chemicals, which could increase NAHB manufacturer members' ability to sell their products in the international marketplace. Another positive offshoot of the changes for all of our members is that new labeling requirements should help avoid workplace injuries among employees who can't read English or cannot understand the written warnings. Specifically under the revised standard, manufacturers will be required to provide a label on hazardous chemicals containers that includes a signal word (i.e., "warning" or "danger"), pictogram, hazard statement and precautionary statement for each hazard. Other significant changes pertain to the specific format of safety data sheets and requirements for worker training. The phase-in period for the revised standard runs through June 1, 2016, with worker training to be completed by Dec. 1, 2013. During the phase-in period, employers must be in compliance with either the existing or revised HAZCOM, or both. OSHA recognizes that hazard communication programs will go through a period in which labels and safety data sheets under both standards will be present in the workplace. For more information, please visit http://www.osha.gov/dsg/hazcom/index.html Court Blocks Implementation of NLRB Poster Rule A controversial rule requiring employers to prominently display a poster advising workers of their right to unionize will NOT go into effect on its planned implementation date of April 30. On Friday, April 13, 2012, the U.S. District Court for South Carolina, in a case brought by the U.S. Chamber of Commerce, ruled that the National Labor Relations Board (NLRB) exceeded its
Home Builder Public Policy Post: April 2012
Page 3
authority in adopting a rule requiring employers to post an employee notice of collective bargaining rights. Judge David C. Norton held that the NLRB’s authority is limited to adjudicating unfair labor practices, and that Congress did not impart the agency with authority to compel employers to post labor rights notices. Going forward, NAHB will continue to monitor all events concerning the poster rule and will provide notification to members regarding future rulings. For more information, visit http://www.nlrb.gov/poster NAHB Seeking Examples of Appraisals Gone Wrong When a new home doesn’t appraise for what the home builder and the home buyer think its worth, no one is happy. But when the appraiser comes up with a faulty evaluation because he or she is not knowledgeable about the kind of construction used or the neighborhood where the home was built, uses bad comps or otherwise bungles the process, NAHB would like to know about it. Your national association is working with the Appraisal Institute to better educate appraisers, builders and real estate brokers and bring order and sense to the appraisal process – something that’s in all our interests. To help move this project along, we’re looking for examples of appraisals gone haywire – not because the builder thinks the house should be worth more, but because the appraiser did not have the tools or knowledge to do the job right. If you have a story you can share please call Steve Linville in the NAHB Housing Finance at 800-368-5242 x 8597. NAHB, Diverse Groups Urge QM Rule to Keep Home Loans Available and Affordable As the Consumer Financial Protection Bureau (CFPB) works to finalize the qualified mortgage rules within the Dodd-Frank legislation passed in 2010, NAHB this week joined with 32 other consumer, housing, banking and civil rights groups to urge the agency to establish a broad, common-sense definition to avoid disruptions to the housing finance system and ensure consumers have access to affordable home loans. At issue is a new ability-to-repay standard which stipulates that borrowers must be able to repay home loans issued to them. While a qualified mortgage (QM) standard will enable lenders to comply with this requirement, how the rule is constructed is critical to the future health of the housing finance system. NAHB and its coalition partners are calling on the CFPB to create a broad, common-sense QM standard that contains strong consumer protections, promotes mortgage liquidity in the marketplace and provides lenders proper incentives to make home loans to creditworthy borrowers. A narrowly defined QM would put many of today’s sound loans and creditworthy borrowers into the non-QM market, which would undermine prospects for a housing recovery and threaten the redevelopment of a sound mortgage market. Loans that fail to qualify as QMs would be less available and far costlier because lenders and investors would face a much greater risk of violating the terms of the new ability-to-repay requirement. In other words, banks would further restrict home lending in what is already a tight lending environment because they would be fearful of the risks of litigation if consumers are unable to repay a mortgage. Loans that support a QM definition would provide lenders with a safe harbor that reduces litigation exposure.
Home Builder Public Policy Post: April 2012
Page 4
NAHB strongly believes that the ability-to-repay standards must balance both consumer and industry interests. Consumers must have access to affordable credit and responsible lenders should be able to operate in an environment without excessive litigation. This will help ensure revival of the home lending market. FWS Seeks Comments on Voluntary Conservation Measures The U.S. Fish & Wildlife Service (FWS) is asking the public to weigh in as it seeks to make it less complicated for landowners who are looking for ways to protect the potentially endangered plants and animals on their property without resorting to additional regulations. FWS published an Advance Notice of Proposed Rulemaking (ANPR) on March 15 seeking comments on potential improvements to regulations, policies and guidance under the Endangered Species Act (ESA) to better promote voluntary conservation efforts -- including conservation measures adopted and implemented before a species is even listed as endangered. The use of additional voluntary measures for these “non-listed” species is a constant challenge for private landowners because FWS usually does not take previous efforts into account when these landowners’ activities later become subject to an ESA, Section 7 consultation or are seeking incidental take authorization under Section 10. The ANPR provides an opportunity to identify key obstacles to the adoption of voluntary conservation measures and to propose potential programs and improvements. Specifically, the FWS ANPR directly highlights and asks for comments on measures to recognize pre-listing or advance mitigation efforts should a species be listed at a later time. NAHB holds that all voluntary conservation programs must provide private landowners with incentives, financial assistance and safe harbor protections as part of its requirements. Without them, private landowners participating in such programs do so knowing that there might be additional restrictions and penalties if a species is listed. Comments on the ANPR are due May 14. For more information contact Larissa Mark at 800-368-5242 x 8157. House Approves Small Business Tax Cut Bill, White House Threatens Veto The House on April 19 approved the Small Business Tax Cut Act (H.R. 9) by a vote of 235-to-173. Introduced by House Majority Leader Eric Cantor (R-Va.), the legislation would allow small businesses with fewer than 500 employees to deduct 20% of their active business income. However, the actual amount businesses could deduct would be limited to 50% of certain W-2 wages. In addition, businesses claiming this deduction would be unable to claim the current Section 199 deduction. Earlier in the week, NAHB sent a letter to House members expressing support for the bill, noting that most NAHB members are small entrepreneurs who employ fewer than 10 workers and report less than $1 million in gross receipts annually. The legislation would provide small business owners with additional financial resources to invest in their companies. Though the bill passed the House, the Senate is not expected to act on it and the White House has threatened to veto the measure if it reaches the president’s desk. Democrats oppose the measure because they argue the benefits would go disproportionately to wealthier businesses.
Home Builder Public Policy Post: April 2012
Page 5