Palm Desert Freezes Fee Schedules

The Palm Desert City Council recently voted 5-0 to freeze the City’s Development Review and Inspection Services fee schedules.

City staff was urging the Council to incorporate changes in the fees for services, which were based on the updated cost for services study using FY 2009-2010 actual expenditures. If adopted, the results would have yielded an increase from 10% to as much as a 100% increase in user fees.

As a result of the Council's August 25 vote, this issue will not be brought back to Council for consideration until budget discussions begin for FY 2012-2013, which will be in April of 2012.

The Riverside BIA is pleased that the Council was sensitive to the state of the industry, and we especially would like to thank Councilwoman Jan Harnik and Mayor Jean Benson for their efforts.

If you have any questions regarding this matter, please do not hesitate to contact Bill Blankenship.

Lawmakers Indicate Support for Extending Conforming Loan Limits

We wanted to draw your attention to this article in today's Monday Morning Report from NAHB:

NAHB’s ongoing efforts to extend the current conforming loan limits, which are due to expire on Oct. 1, received a boost this week when CQ Today reported that Rep. Barney Frank (D-Mass.) said the Administration has changed its stance on the issue and would now support a one-year extension of the current home loan guarantees.

Reps. John Campbell (R-Calif.) and Gary Ackerman (D-N.Y.) on July 15 introduced legislation (H.R. 2508) that would provide a two-year extension. In addition, pending legislation by Reps. Gary Miller (R-Calif.) and Brad Sherman (D-Calif.) — H.R. 1754 — would provide a permanent extension. Despite these positive developments on this issue, extending the mortgage limits is far from a done deal, with many conservative lawmakers in opposition and in favor of reducing the government's involvement in housing and potential risks to taxpayers. If Congress fails to act, the national ceiling for Fannie Mae, Freddie Mac and Federal Housing Administration home loans will drop from $729,750 to $625,000. A drop in some mortgage loan limits would reduce housing demand and place downward pressure on home prices in major markets across the country, exacerbating the current housing downturn and endangering the fragile economic recovery, according to NAHB economists. The CQ Today article also cited NAHB CEO Jerry Howard, who predicted an extension would come to pass if voted on in the House. "It's really not a partisan issue," said Jerry. "It's a geographic issue, and Republicans in high-cost areas are going to have to recognize their constituents." See NAHB's recent study on the impact of loan limit changes for 2011. Contact: Scott Meyer (800-368-5242, x8144).

Governor Brown Signs Subdivision Map Extension Legislation

CBIA's Government Affairs team is reporting that Governor Jerry Brown has signed Assembly Bill 208, authored by Assemblyman Fuentes (D-Sylmar).  The legislation statutorily extends the life of tentative subdivision maps that would have expired prior to January 1, 2014.

The Governor's action protects nearly 2,500 approved tentative tract maps representing nearly 330,000 housing units that are currently approved but have been stalled due to depressed housing markets and a stubborn economy.  AB 208 provides an additional 24-month extension to expiring maps and will seamlessly benefit projects that were extended by 24 months back in 2009 by way of AB 333 (Fuentes).

CBIA and the Riverside BIA would like to thank the bill’s author, Assemblyman Felipe Fuentes, for his leadership and steadfast support of our industry.  CBIA and the Riverside BIA would also like to recognize Senator Alex Padilla (D-Pacoima), who played a critical role throughout the process as the bill's jockey on the Senate Floor last week, along with the bill’s co-authors:   Assemblyman Kevin Jeffries (R-Riverside), Assemblyman Nathan Fletcher (R-San Diego), Assemblywoman Toni Atkins (D-San Diego), Assemblyman Ben Hueso (D-San Diego), Assemblyman Roger Hernandez (D-Baldwin Park), Assemblyman Cameron Smyth (R-Santa Clarita), and Assemblywoman Nora Campos (D-San Jose).

The team at CBIA and the Riverside BIA would also like to thank Governor Jerry Brown and his staff for recognizing the importance and urgency of this critical legislation.  We encourage you to write the Governor and the author of the bill to express appreciation for their efforts to assist the industry, particularly if a project of yours has been aided.

Download a "Thank You" letter template to the Governor

Download a "Thank You" letter template to Assemblyman Fuentes

New Report Cites Housing's Critical Importance to CA Economy

The Public Policy Institute of California released a report, "California Housing," last month as part of PPIC's ongoing Planning for a Better Future project. The four-page brief succinctly points out how critically important housing is for the state's economy and some of the things that should be done to help the industry rebound. Please share this important report with your industry colleagues!

Some of the highlights:

  • The housing depression has caused large losses of construction jobs, "which accounted for 6% of California's jobs when housing prices were at their peak."
  • Despite the drop in housing prices, they remain high in most of California, which helps make the state too expensive for many businesses and employees. "In both the short and the long term, California's economic performance and livability depend on its housing market."
  • Rents in the parts of the state where most people live have actually risen in nominal terms during the recent crisis. "Five of the ten most expensive rental markets in the U.S. are in California: San Francisco, Orange County, San Jose, Ventura County, and Los Angeles."
  • California is far from being the epitome of sprawl that many people contend it is. "(I)ts housing density is 35% above the national average and rising... the Los Angeles and San Francisco metropolitan areas have the second- and third-highest residential density in the U.S., after New York, while San Jose and San Diego are also in the top ten."
  • As we've been saying for some time, there is still a shortage of housing, counter-intuitive though that sounds. "High housing prices indicate that California's housing market is tight; low vacancy rates confirm this." In fact, "the residential vacancy rate in California remains among the lowest in the country. Even in the San Joaquin Valley and Inland Empire, residential vacancy rates are near the national average." Unlike Arizona and Nevada, where foreclosure often leads to abandonment, "in California, foreclosure more often means turnover."

Finally, the report lists three key recommendations: policy makers need to help resolve the foreclosure crisis, fund affordable housing construction, and remove unnecessary barriers to expanding housing supply. Here's what the PPIC says about government barriers:

"Why is housing so expensive in California? Many people and industries are willing to pay a premium to be in California, keeping demand high. At the same time, the supply of new housing is constrained both by geography and regulation. Most of populated California is nestled against the ocean, the Bay, or the mountains - natural barriers to construction. And California has unusually strong land use and building regulations, especially in the major coastal cities, which curtail construction and keep prices high. California cannot move the mountains or fill the ocean, but it can tackle some of the regulations and related rules and fees that contribute to high housing prices (emphasis added)."

Read the full report

La Quinta Defers DIF Increase

Great news from our Government Affairs Team! On Tuesday, June 21st the La Quinta City Council voted 5 – 0 to defer the implementation of the increase of its DIF for residential units for another six months.   

The fee deferral represents a savings to the industry in the amount of $3,238 per unit and will be in place until December 30, 2011.    

This is the third extension that the Riverside County BIA has secured for the industry and, as a result, will continue to freeze the current fee for a single family dwelling unit at $4,475.     

If you have any questions, please contact Deputy Director Bill Blankenship at (951) 781-7310 or bblankenship@riversidebia.org.  

Builders See Repeal of Onerous Form 1099 Reporting Requirements

Our colleagues at our national affiliate, the National Association of Home Builders (NAHB), are always working hard on our members' behalf at the federal level. Here's more evidence from NAHB's Nation's Building News:

April 18, 2011 - President Obama on April 14 signed legislation supported by NAHB to repeal a burdensome tax paperwork requirement that could have cost small businesses thousands of dollars each year.

"During the past several months, NAHB led the effort along with other industry groups to strike all new expanded IRS Form 1099 reporting requirements for small businesses and owners of rental real estate," said NAHB Chairman Bob Nielsen.

"In testimony before Congress and in 'key vote' letters to House and Senate leaders, we spelled out how failing to overturn these rules would have killed jobs and placed a major paperwork and cost burden on home builders," Nielsen said.

Under the Patient Protection and Affordable Care Act approved last year, starting in 2012 businesses would have had to file an IRS Form 1099 for each vendor from whom they purchased more than $600 in goods over the course of the year.

With the annual $600 threshold applicable to all vendors, businesses could have found themselves sending out 1099 forms for such mundane purchases as coffee, fuel and office supplies.

Rather than hiring additional workers to expand and grow, small businesses would have been spending money on accountants and bookkeepers in order to meet these new requirements.

On April 5, the Senate by a vote of 87 to 12 passed the Small Business Paperwork Mandate Elimination Act of 2011 (H.R. 4), legislation previously approved by the House.

In addition to repealing expanded 1099 requirements in the healthcare law, H.R. 4 also repealed an unfair provision in the Small Business Jobs Act of 2010 requiring independent landlords starting this year to submit 1099s to firms to which they give more than $600 for services.

Going forward, businesses will still have to comply with long-standing reporting requirements for the purchases of services.

To read the bill, click here and enter H.R. 4 in the box at the upper center of the page.

For more information, email J.P. Delmore, or call him at 800-368-5242 x8412.

Photo credit: Flickr user Frank Kehren

Subdivision & Parcel Map Extension Bill Moves Through First Hearing

A bill that would help protect nearly 2,500 existing tentative tract maps and parcel maps is making the rounds in Sacramento.

Authored by Assemblyman Felipe Fuentes (Appropriations Chair), AB 208 would statutorily extend tentative subdivision and parcel maps for an additional 24 months. The bill moved quickly through the Local Government Committee earlier this week on consent and with full bi-partisan support.

Assemblyman Fuentes continues to be a stalwart supporter of the home building industry as demonstrated by his authoring of AB 333 in 2009, and again this year with AB 208.

AB 208 will now be heard in the Assembly Committee on Housing and Community Development on April 6.

CBIA Seeks Two Year Extension for Subdivision Maps

Keeping projects afloat and subdivision maps alive is a top 2011 legislative priority for the Riverside BIA's state affiliate, the California Building Industry Association.  CBIA is sponsoring AB 208 by Assembly Member Felipe Fuentes (D-Sylmar) which would statutorily extend tentative subdivision and parcel maps for an additional 24 months.

The measure builds on the previous 24-month map extension approved by the Legislature and Governor Schwarzenegger in 2009 (AB 333 – Fuentes), as well as SB 1185 (A. Lowenthal), a 12-month extension approved in 2008.  Both measures were approved in the hope that the housing economy would rebound.  Unfortunately, state unemployment sits at more than 12%, the state’s housing starts are near all-time lows and the forecast for 2011 housing starts only shows modest improvement.  

AB 208 is key to keeping projects on-line as housing markets slowly recover.

As introduced, AB 208 has a bi-partisan list of early co-authors, including Assembly Member Nathan Fletcher (R-San Diego), Assembly Member Toni Atkins (D-San Diego), Assembly Member Roger Hernandez (D- West Covina), Assembly Member Ben Hueso (D-San Diego), Assembly Member and Chair of the Assembly Local Government Committee, Cameron Smyth (R-Santa Clarita), Assembly Member Nora Campos (D-San Jose), as well as Senator Alex Padilla (D-San Fernando Valley).

Photo credit: Flickr user millicent_bystander

CBIA Secures Major School Facilities Victory

After months of negotiations with school districts throughout California and an intensive lobbying campaign aimed at the State Allocation Board (the entity responsible for allocating state funds for the new construction and modernization of local public school facilities), the CBIA Governmental Affairs division is pleased to announce that a major agreement has been struck that will make significant additional dollars available to finance the construction of new school projects. The deal, just approved unanimously by the Allocation Board, will likely provide builders with a cushion against triggering “level 3” (100% builder financing) through the coming year.

Under the specifics of the plan, $233 million in remaining bonding authority heretofore reserved for urban districts, minus a 15% reserve, will be transferred into the state’s new school construction account. The official action took place this afternoon during the final meeting of the year of the Board. The $211 million transfer, coupled with roughly $300 million in remaining funds tagged for new construction, raises the new construction fund balance to well over $500 million.

The deal reflects the culmination of months of negotiations and countless hours of lobbying by the CBIA team of Jason Bryant, Gary Gibbs and Richard Lyon. CBIA thanks all of the Allocation Board members, including the Chair, Cynthia Bryant, and the legislative leadership, particularly Assemblywoman Joan Buchanan (D – Danville), and Senators Jean Fuller (R – Bakersfield) and Bob Huff (R – Diamond Bar). Over the course of the coming year CBIA will continue to monitor the burn rate and the status of funds as it gears up for a collaborative effort to place a comprehensive school bond on the 2012 statewide ballot.

Riverside BIA Awarded Chapter of the Year & EO of the Year Honors

For the third time in four years, Riverside BIA has been named the BIA of Southern California’s Chapter of the Year

This is a very high honor, and we are proud of our exceptional Board, members and staff for making this incredible feat possible!

BIA of Southern California CEO Rich Lambros cited many reasons why Riverside BIA stood out from the pack this year, particularly highlighting the following:

  • Desert Region—Riverside BIA assumed control of all of BIA operations in the former Desert Chapter’s coverage area this year.  We’ve met continually with members, elected officials and staff of all cities in the region to help smooth the transition.  We are exploring new alliances and ways to offer added value to member in the Desert region.
  • Government Affairs—Riverside BIA has been tenacious in obtaining fee reductions and deferrals.  In fact, though June 30, 2010, savings from fee reductions totaled more than $13.5 million!  We waged a successful campaign to defeat the New Water Demand Offset Fee (NWDOF) of $3,280 in the Rancho California Water District.  And ALL of the 16 school districts in western Riverside County that updated their School Facility Needs Analysis so far in 2010 reduced their fees!
  • Membership—Our membership has remained strong in 2010.  Through June, our net primary membership had increased 9.8%.  Our May membership drive was enormously successful with 17 new members added in two days.  And in the Desert Region, we’ve worked to rebuild and renew memberships.

What’s more, our illustrious CEO, Mark Knorringa, was named Executive Officer of the Year!

Lambros recognized Knorringa for his outstanding leadership during a tumultuous year for both the industry and the association.   In particular, Knorringa was honored for his leadership of the Chapter’s tremendous Government Affairs program and the takeover of the Desert Region’s advocacy, membership and sign programs.

Lambros also noted the Riverside Chapter’s continually successful programs and events and said that Riverside was the only one of the BIA of Southern California’s five chapters with a net membership gain this year!

Again, we must thank our imaginative and supportive Board for its visionary leadership, as well as our hundreds of member volunteers and staff who work so hard throughout the year on behalf of the association and the industry!

Thank you!!

Photo Credit: Applied Photography

California Housing Finance Agency Reinstates First Time Home Buyer Program

The federal and state tax credits for home buyers may be long gone, but there are still programs available to provide financial assistance to first time home buyers.

The California Housing Finance Agency just reinstated its School Facility Fee Down Payment Assistance Program (SFF), which offers a conditional grant based on the amount the school facility fees paid by the builder of a new home.

The SSF has two programs. The first aids first time buyers. The second aids buyers in specific economically challenged counties and waives the first time buyer requirement.

The aid allows new home owners to be able to fund their down payment, closing costs and any other costs that are associated with their first mortgage loan. 

Read more here

Housing-Friendly Candidates Do Well Nationally

NAHB's political action committee, BUILD-PAC, achieved some very good results in the latest midterms. Out of the 27 Senate races to which BUILD-PAC contributed, 23 of the candidates NAHB supported won election, for an 85% success rate. And in the House of Representatives, out of the 328 races to which NAHB contributed, 286 resulted in a win for a BUILD-PAC-supported candidate — an 87% success rate. In all, BUILD-PAC was successful in 309 out of 355 decisive races, also an 87% success rate. (Note, these results do not include races that were too close to call as of Friday.)

Read more about BUILD-PAC and the Mid-term elections

The Witching Hour - Our Recommended Votes for Local Office

So the polls open in just about 12 hours. You ARE voting, right?!! Kidding aside, your vote is extremely important in local, state and national elections because now more than ever politicians hold very divergent views on the best course for our economy.

Locally, we need elected officials who are able to balance the need for responsible growth. Our choices will determine whether we recover from this recession in a year or in five years.

Please take a look at our list of recommendations for local office and PLEASE vote tomorrow!!

Read the List

Photo credit: jcolman

Riverside County cities could keep impact fee discounts

There's a great story in today's Press-Enterprise about the positive impact fee reductions have had on spurring development (and economic recovery) in the Inland Empire. The news is so good, in fact, that many councils and boards are looking to extend fee reductions set to expire this December.

Our own Riverside County Chapter CEO Mark Knorringa is quoted in the article commenting on how builders have used reductions to help keep projects going:

They have said specifically there were some projects they built when they did because of the fee reduction.

The article includes an interesting city-by-city comparison of permits issued during the first eight months of 2009 vs. the first eight months of 2010.

Read the full article

Photo credit: twoGiraffe

New California budget details released

Those who attended today's Legislative Affairs Committee luncheon at Cafe Sevilla in Riverside know that the Legislature was called back to Sacramento yesterday to deal with the state budget. They know this because Assemblyman Brian Nestande was scheduled to be our guest speaker but had to back out at the last minute.

(Many thanks to Supervisor Marion Ashley for stepping in and providing members with an excellent overview of the state of the County!)

So today California's top lawmakers and Gov. Arnold Schwarzenegger have struck a budget accord.

The agreement avoids the deepest cuts that Schwarzenegger had proposed, but under the plan, current state employees would have their pay cut, contribute more to their pension plan and would be subjected to a payroll freeze.

Read the 8-page analysis from the Budget Conference Committee

Read the LA Times article on the budget agreement

View the photos from today's Legislative Affairs Luncheon

CARB Sets Greenhouse Gas Reduction Targets

Recently we reported that the Southern California Association of Governments' board had rejected emission reduction targets proposed by the California Air Resources Board. Good news, right?

Unfortunately, the California Air Resources Board didn't see it the same way.

CARB has now approved the higher GHG reduction targets for 2020 and 2035 for each of the 18 metropolitan planning organizations in the state.  The six-county area that covers SCAG will be required to reduce the per capita greenhouse gas emissions from cars and light trucks 8% between 2005 and 2020 and – tentatively (subject to further determination next February) – by 13% between 2005 and 2035, according to the targets set by CARB.

This issue will have a drastic impact on land use planning in California. Need to know more? The BILD Foundations will focus the majority of its 9th Annual Conference next week (October 6) on SB 375 and this GHG reduction issue, along with water supply issues. Find out more about the conference program and how to register below. We highly recommend this conference!!

Read more about the CARB vote

Read more about the BILD conference program & speakers

Register for the BILD Conference

Action Alert: Urge Boxer & Feinstein to Pass H.R. 6191

President Obama recently signed into law the Small Business Lending Fund Act of 2010. Unfortunately, this new lending program will not address the small business lending crisis facing the home building industry.

The new small business lending fund specifically excludes home construction loans to small builders from the eligible pool of lending in the new fund!

Fortunately, a stand-alone bill, H.R. 6191, has been introduced by Rep. Brad Miller (D-NC) to fix the construction loan omission. The bill passed the House of Representatives yesterday and now goes to the Senate for a vote.

This is a very important issue for many homebuilders! Lack of housing production credit is preventing builders from meeting the emerging demand for new homes and, for many, endangering their ability to survive the economic downturn!

Please call or email Sens. Dianne Feinstein and Barbara Boxer and ask them to support H.R. 6191! 

Sen. Feinstein's DC number is (202) 224-3841. Her local office number for Riverside County is (619) 231-9712 . Or you can email her.

Sen. Boxer's DC number is (202) 224-3553. Her local Riverside office number is (951) 684-4849. Or you can email her

Please call or email today!! And after you speak with their offices, let NAHB government affairs department know how they responded

Photo Credit: Flickr User Phil Romans

CARB Takes Up Greenhouse Gas Emission Reduction Targets

A few weeks ago we told you about a great victory at a Southern California Association of Governments meeting when rationality won out over intense political pressure from environmental extremists.

That was when the SCAG board agreed that emission reduction targets proposed by the California Air Resources Board were unrealistic and potentially harmful to our region's struggling economy. SCAG voted to reject the proposed targets of 8% for 2020 and 13% for 2035 and instead recommended emission reduction targets at 6% for 2020 and 8% for 2035.

Well, CARB will be taking up the issue at a public hearing tomorrow in Sacramento.

Please read CBIA CEO Liz Snow's op-ed in today's Sacramento Bee on why CARB is on a very destructive path with this issue.  Let's hope level heads prevail!

Read the op-ed

Watch the live meeting webcast, starting at 9 am

Photo Credit: Slices of Light

Op-Ed by Riverside BIA Preident Kevin Canning in Today's PE

The Riverside Press-Enterprise today ran a terrific op-ed from President Kevin Canning regarding the need for leaders at the civic, county and statewide levels to work together to help our economy recover. The piece explains the vital role construction, particularly that of new housing, plays in our region's economy and the direct, secondary and other ripple effects it carries across nearly all economic sectors and industries.

Says Canning:

Recent efforts in parts of Riverside County and statewide have utilized a proactive approach to revive the hard-hit construction industry. These include temporary reductions in development impact fees and state/federal tax credits, all of which have had positive effects in the context of the recession. It's critical that we continue to allow these industries to recover and re-establish themselves, as they provide employment and economic activity that are of widespread benefit. 

Read the full article

Photo credit: steveleenow