HBAA BACKED AD VALOREM BILL GETS FAVORABLE REPORT
|
| House Bill 179 (Williams, Birmingham) received a favorable report from the House Commerce and Small Business committee on Wednesday. The HBAA is working with the sponsor to get the measure on the House calendar at the earliest possible opportunity.
This legislation would eliminate what is essentially an inventory tax on a builder's homes and lots by redefining them as class III property which would be assessed at 10% valuation rather than at the 20% rate currently charged.Consumers would benefit greatly as it would end the practice of charging a home buyer the 20% rate for an additional year, regardless of homestead exemption, if the home is purchased after Oct. 2 of any given year.
|
|
MIKE HILL INTRODUCES HBAA LANDLORD TENANT BILL
|
Representative Mike Hill of Columbiana introduced the HBAA Landlord Tenant Bill on Thursday. The HBAA's Investment Property Owners Council worked closely to develop language that would streamline the current landlord tenant act and clarify language that has been misinterpreted in the courts. HB 328 is a stand-alone bill, however the bill's language is being combined with language from the Realtors to create a joint effort. The HBAA is working to get both bills brought before the committee at the earliest opportunity.
|
RIGHT OF REDEMPTION REDUCTION BILL INTRODUCED IN SENATE
|
|
Senator Slade Blackwell (Birmingham) introduced SB 263 on Thursday that would reduce the right of redemption period on property to 90 days. Currently, the right of redemption period extends for one year.
The HBAA has called for a public hearing on the bill when it comes before the Senate Banking committee. Likewise, the HBAA has called a public hearing on the House companion bill, HB 343 (Clouse, Ozark). The HBAA maintains that the right of redemption is sometimes the only leverage builders/developers have to negotiate with lenders. It is important that this attack against home builders and developers is stopped. The HBAA will work with members of the Senate Banking committee and the House Judiciary committee to encourage them to stand on the side of small business and oppose this legislation.
|
|
ALABAMA ASSOCIATION OF REALTORS PUSH BILL TO RESTRICT DEVELOPMENT FINANCING ALTERNATIVES
|
|
"If the developer can't get financing from the bank, maybe he doesn't need to do the project." Anyone that would utter these words would be ill-informed on the status of development/construction financing in the current economic times. This was the message delivered by a spokesman for the Alabama Association of Realtors as he appeared before the Senate Judiciary Committee to advocate for passage of a bill that would potentially eliminate a viable source of land development financing, Private Transfer Fee (PTF).
PTFs come in a number of incarnations. Some are held by home owners associations while others are non-profits, governmental entities, and third party financing groups. Used in 48 states, these fees are a tool that allows for financing infrastructure outside of the traditional banking structure. There are controversial aspects to the use of PTF financing.
On March 7, the Federal Housing Finance Agency (FHFA) decided to propose a rule that would limit regulated entities (Fannie Mae, Freddie Mac, Federal Home Loan Banks) from dealing in mortgages encumbered by PTFs. The proposed rule carves out an exception for "PTFs paid to home owners associations, condominiums, cooperatives, and certain tax-exempt organizations that use the PTF to provide a direct benefit to the owners of the encumbered real property." The concept is simple. PTF is a perfectly viable financing source so long as the consumer directly benefits from it. The Realtor bill would not be so objectionable if it clearly stated which type of PTF they are interested in outlawing. Their draft instead lists pages of definitions of what does not constitute a PTF. Herein lies the problem. The law of unintended consequences would suggest that creating an "exhaustive" list of what is not a PTF opens the door to omissions that would negatively affect other financing tools. A shorter, specific measure that clearly defines the PTF in question and creates a rigorous disclosure process would serve everyone far better than the current bills being considered.
The HBAA will work with the Realtors and the Senate and House leadership to fix the inherent problems that come with this legislation.
|
|
HOUSE AND SENATE MOVE IMMIGRATION BILLS
|
| As part of the Republican's "Handshake with Alabama," members of the legislature are moving forward on plans to address illegal immigration in the state. Rep. Micky Hammon of Decatur plans to have HB 56 before the full House next week. The HBAA and its business association partners have worked with Rep. Hammon on amendments that would lessen the burden on builders and subcontractors.
Those provisions are not part of Senator Scott Beason's bill. Senator Beason's bill does offer some improvement in the area of verification of legal status in that it allows other forms of verification other than e-verify. On the other hand the bill provides for a suspension of licenses on a first violation (10 days). Additionally, his subcontractor liability provisions are much stricter. In particular, it seems as though his bill would require every employer entering into any contract (i.e., subcontract) to verify the employment status of the contractor's/subcontractor's employees.
Although it is unclear what the final version will look like, it is clear that as a key part of the Republican agenda, immigration reform will pass in some fashion during this session. On Monday, the business associations that the HBAA is working with will meet to discuss the latest developments. The HBAA will continue its efforts to address those issues in both bills that negatively impact the home building and construction industry.
|
