LEADERSHIP
Board of Directors President: Ken Corbo Vice President: Wink Foster 2nd V.P.: Norma James Treasurer: Troy Meads Secretary: Gary Eure Immediate Past President: Lauren Spruill --------------------------- Morris Barber Chicago Eure Linda Gregory Randy Krainiak Mack Nixon Berry Payne
Future Builders Compete at Currituck Chamber Expo "Build A Business"
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The Home Builders Association of Northeastern North Carolina sponsored it's fourth annual "Build A Business" competition on Saturday, March 3rd as part of the Currituck Chamber Business Expo and Job Fair. Builders 5-8 years old and 9-12 years old competed separately as each contestant was given a set of Lego blocks (complete with flowers & shrubs) and challenged to build a business - real or imagined using their skill and imagination. At the end of one hour Judges inspected each building based on specific criteria and talked with the builders about their projects. The top three highest scoring projects in each age group won a Lego Building Kit. Winners of the 5-8 division: First Place: Elijah Anderson Second: Leah Cornett Third: Brooks Sink Winners of the 9-12 division: First Place: Austin Bellinger Second: Rachel Belue Third: Kenita Sohn Projects ranged from a working farm complete with barn and livestock to a bank with "built-in" security in the form of poisonous shrubs. All builders received a participation certificate from the HBA.
March 2018
NCHBA Passes Resolution for Mandatory Continuing Education for General Contractors
3. Why is now the time to pursue mandatory CE There are several reasons , among them are : •Builder opinion of CE has evolved: Mandatory CE has been a topic which has been seriously considered on several occasions in the past both by state and local NCHBA leadership. However, legislation was not pursued because the evidence then suggested that mandatory CE was not favored by a majority of our builder members. In 2012, a statistically valid survey of 300 of our builder members showed that CE was narrowly opposed. However, that survey showed support by builders aged 30 - 59 and opposition by those 60 and older. Since that poll, many of those builders 60 and older are no longer active builders or members. The NCHBA leadership believes that the majority of our builder members now support mandatory CE as was reflected in the overwhelming Board vote to approve the resolution. •Adoption of New Strategic Plan: Last fall at its planning retreat, the 2018 NCHBA Executive Committee (a 23 - member body elected by the Board of Directors including 5 senior officers and 10 regional vice presidents) proposed a new 3 - year strategic plan for NCHBA which included a specific action item seeking Board approval for legislation requiring mandatory CE. This plan (i.e., “Vision 2020: NC HBA Strategic Plan 2018 - 2020”) was approved by the NCHBA Board of Directors in December of 2017. The resolution adopted on February 20, 2018, was the response to this directive. •Favorable Political Environment: Mandatory continuing education for genera l contractors will eventually be enacted — whether by our initiative or otherwise. It is already a requirement for most of our trade partners. Other industry groups who represent non - residential contractors favor mandatory CE and will seek legislation in the future. The NC Licensing Board for General Contractors , who will regulate mandatory CE and who previously opposed it , are now in favor of it. The current political environment in the General Assembly allows NCHBA greater flexibility to craft legislation more favorable to our members now than what may exist in the future. In other words, we now have the opportunity to play the major role i n what is drafted. 4. Why Board approval? NCHBA is a not-for-profit corporation chartered by the State of North Carolina and governed by a board of directors composed of presidents of each of our local HBAs , other state directors who are elected or appointed by the local HBA, members of the NCHBA Executive Committee and NCHBA Past Presidents
On February 20, 2018, the Board of Directors of the North Carolina Home Builders Association (NCHBA) overwhelmingly adopted a resolution which directs the association to seek the introduction and passage of legislation during the 2019 Session of the NC General Assembly to require continuing education (CE) for general contractors. The following fact sheet is designed to answer questions about this initiative and to inform members about anticipated steps to be taken to further this initiative. 1. Do I have to complete CE for my general contractor license now?No, the Board voted to seek legislation requiring mandatory CE which, once finalized, will be introduced next year in the 2019 Session of the General Assembly. Assuming this legislation is enacted, it would not become effective before 2020 at the earliest. It will take at least a year to develop an effective and reasonable CE system and put it in place. 2. Why mandatory CE?Currently, any continuing education (CE) on the part of a licensed general contractor is voluntary. The resolution contemplates a mandatory requirement applicable to qualifiers of general contractors’ licenses. While there are numerous reasons in support of a mandatory requirement, current NCHBA President Alan Banks summarized it well : “The pace of change in terms of building codes, products and risk management has never been faster. For years, building practices largely did not change and most education happened on a job site between an experienced trades person and an apprentice. That is no longer a viable or effective way to disseminate information and practices. Our industry must have a consistent way to make sure that significant building code changes, regulatory changes and potential legal pitfalls are shared broadly. A reasonable continuing education requirement for all general contractors creates the pathway for this objective.”
NAHB Asks OSHA to Expand Compliance Assistance
NAHB has called on OSHA to expand its compliance assistance to help home builders and other small business owners improve the safety of their operations. J. Gary Hill, a home builder from Greensboro, N.C., and 2018 chairman of NAHB’s Construction Safety and Health Committee, made the appeal during a recent House subcommittee hearing on “a more effective and collaborative OSHA.”
as set forth in the governing bylaws of the association. Among its several responsibilities, the Board of Directors sets association policy. The directors represent the membership and act on its behalf. The senior officers felt that this resolution should be subject to a full and fair debate and Board approval of this important policy direction 5. What will the CE look like? NCHBA will work to accomplish the following : •Number of CE Hours to be required —Your leadership is on record in advocating that any mandatory CE requirements be able to be satisfied in one day. • Availability of Courses—NCHBA already possesses an excellent CE delivery system — its North Carolina Builders Institute (NCBI). A priority will be to make CE courses available locally with the cooperation of the local HBA which will create additional non-dues revenue and non-member recruitment opportunities for local HBAs . NCBI will continue to offer courses in the Spring (in Raleigh) and Fall (in Charlotte) and likely, regionally. In addition, other course providers will certainly enter the marketplace. We will also examine making some courses available on-line. • Price—The marketplace and competition will set the price. Current charges for NCBI courses are $95 for 4 - hour course and $190 for an 8 - hour course. Every effort will be undertaken by NCBI to deliver quality courses at a reasonable cost. • Administration of CE program —The NC Licensing Board for General Contractors will be responsible for administering this program on behalf of its qualifiers. It will also be responsible for reviewing and approving course content and number of credit hours that can be claimed. It will maintain records of courses taken by qualifiers and enforce CE requirements. 6. What’s next? NCHBA staff will meet with the NC Licensing Board for General Contractors and other industry stakeholder groups to begin formulating an effective and reasonable CE program. The NCHBA Senior Officers will provide oversight of this effort. Once legislation is drafted, we will bring it to the Board of Directors for input and approval at its December 4, 2018, 4th Quarter meeting. Once the legislation is in final form, it will be introduced into the 2019 Session of the General Assembly.
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In a victory for NAHB remodelers and their customers, the IRS on Feb. 21 clarified that households that take out a home equity loan or line of credit may take a tax deduction when these loans are used for home improvements. NAHB has been pushing hard for this outcome since December, when the Tax Cuts and Jobs Act of 2017 was signed into law. “This is a major victory for remodelers and for home owners who want to enhance and invest in their homes,” said NAHB Chairman Randy Noel. NAHB will continue to work with Congress and the administration as they hammer out the details of the new tax law.
IRS: Home Equity Loans Can Be Tax Deductible
7. When will CE requirements become effective? As noted above, legislation must be enacted in order to require CE and it would not become effective until 2020 at the earliest.
Affects of Tax Reform on Your Business
Major tax reform was approved by Congress in the Tax Cuts and Jobs Act (TCJA) on December 22, 2017. The changes, both good and not so good will have a major impact on small and medium sized businesses in the future. During a recent webinar, presented by NAHB the laws and how they could affect your business were explained. Some of they key changes are as follows: 20% Pass - Thru Deduction Small businesses which are organized as passthroughs (LLC, partnership, (most) S Corps) may deduct 20% of qualified business income. Importantly, this deduction is in addition to reductions in individual rates and is also in addition to the deductions generally available to individual taxpayers. A taxpayer who earns passthrough income eligible for the 20% deduction does not have to itemize his or her deductions to claim the deduction, and may simultaneously claim this deduction and the standard deduction. What is Qualified Business Income? Qualified business income generally refers to taxable income from a qualified passthrough business meaning the net amount of qualified items of income, gain, deduction, and loss with respect to the trade or business of the taxpayer. Qualified business income is determined for each qualified trade or business of the taxpayer. Qualified business income does not include any amount paid by an S corporation or a partnership that is treated as reasonable compensation for the taxpayer. Items are treated as qualified items of income, gain, deduction, and loss only to the extent they are connected with the conduct of a trade or business within the United States. Business Interest Deduction (BID) For businesses with gross receipts above the $25 million threshold, interest deductibility is limited to 30% of earning before interest, taxes,
depreciation, and amortization for four years and thereafter is limited to 30% of earning before interest and taxes. Changes to Sec. 179 Depreciation In addition to increasing section 179 expensing, the law also includes a temporary (through 2022) increase of “bonus depreciation” under section 168(k) . This allows 100% cost expensing for acquisitions of depreciable business property, regardless f the amount of property. State & Local Taxes (SALT) for Business The new federal law fully allows a deduction for state and local taxes imposed upon a business (even where the deduction for such taxes flows through to the business’s owner) . By contrast, the law restricts state and local taxes imposed upon the owner of a business. AMT to the Rescue? The corporate AMT (Alternative Minimum Tax) is repealed . The income level that triggers phase - out of the AMT exemption has been increased dramatically, from $120,700 to $500,000 (individual filers) and from $160,900 to $1 million (married filers). The exemption itself has risen by roughly one - third, from $54,300 to $70,300 (individual filers) and $84,500 to $109,400 (married filers). These figures are also indexed for inflation . Incentives For Hiring Another last-minute provision that was saved from the ax in tax reform is the Work Opportunity Tax Credit (WOTC). WOTC, in brief, gives a tax benefit to employers who hire specific populations -- example, veterans, long-term unemployed; individuals receiving federal support; etc. There are also a number of state hiring incentives for which a business may qualify. To ensure that you maximize tax savings from the new tax laws consult your accountant!
Video Highlights from NAHB Board Meeting
Construction Industry Continues to Experience Skilled Labor Shortage
If you missed the NAHB Board of Directors Meeting or the Meeting of the Members, you can still see video highlights from Builders’ Show meetings that took place in Orlando in January. The site also includes videos from key committee and council meetings. Please start making plans to attend the Builders’ Show in Las Vegas in 2019.
Find Housing Data by Congressional District
The building industry is experiencing a rebound and as a result builders are facing a new challenge: there aren’t enough skilled workers to do the job.An ever changing economy coupled with uncertain immigration policy are both factors in the lack of skilled labor. "We need about 80 percent more framers out in the marketplace," said Tim Minton, director of government affairs for the North Carolina Home Builders Association. The need for those workers drives up pay and the competition among construction companies in hiring.Builders are thankful for the growing workload, but they also worry about keeping up. "Wages can go up to some extent, but when you just run out of people, you can't keep building buildings if you just can't find the people to do it," Commercial builder Charlie Wilson, of C.T. Wilson Construction Co. Inc., said, noting the "certainty of when you can deliver a project and how much it's going to cost" suffer as a result. Because of the skilled labor shortage, the construction industry is reaching out to high schools and community colleges to ramp up their trade programs."Our hope is we'll see just more people move to that as a career field, and hopefully that will help with the price and timing and everything else," Minton said.
NAHB has teamed up with the survey firm Morning Consult to deliver a website that offers a wide range of housing and polling data specific to congressional districts and major metropolitan areas. The new “Housing Portal” enables builders, developers and their advocates to demonstrate to policymakers the importance of the housing industry. The user can click on any state on the U.S. map to see a range of housing data specific to that state. The user can then drill down to see housing economics and survey data for congressional districts in that state. The site also features a “generate report” function that allows the user to produce a report showcasing data from any state or congressional district of interest.
Tuesday, March 20th, 2018 - 6:30 pm General Membership Meeting at Nothing Fancy Cafe in Edenton ------- Tuesday, April 17th, 2018 - 6:30 pm General Membership Meeting at Piedmont Natural Gas Co. in Elizabeth City ------- Thursday, May 3rd, 2018 at 12:00 pm CODE SEMINAR with NCHBA's Robert Privott Location TBD ------ Tuesday, June 19th, 2018 - 6:30 pm General Membership Meeting at ABC Supply Co. in Elizabeth City
CALENDAR OF EVENTS
Spring Session in Raleigh, March 20-22 Why Should You Attend? Benefits Your Bottom Line-Gain valuable info about changes to the state building code, learn how to make your remodeling business more profitable, and master the keys to effective management. CAPS I, II & III-Ready to work towards your NAHB CAPS (Certified Aging-In-Place Specialist) designation? Earn your designation over three days during the Spring Session. To register or to get more information click HERE
Tax Credit Extensions Included in Budget Accord
Register for Spring NCBI Courses
Congress retroactively extended a number of expired energy and home owner tax provisions as part of the Bipartisan Budget Act of 2018. The following tax credits were reinstated on a retroactive basis for 2017 only: Mortgage insurance premiums: Subject to income phase outs, consumers who file their taxes can deduct premiums paid for private mortgage insurance in 2017. Mortgage forgiveness tax relief: The budget accord eliminates any taxes home owners might face due to renegotiating the terms of a home loan, which result in forgiving or canceling a portion of the outstanding mortgage, particularly in connection with a short sale. This pertains to debt discharged in 2017, but not in 2018. Section 45L Credit for Energy-efficient New Homes: Provides a $2,000 tax credit for the construction of homes exceeding heating and cooling energy standards by 50%. The base energy code is the 2006 International Energy Conservation Code plus supplements. Builders must have a tax basis in the home to claim the credit. Other tax credits included in the final bill are the Section 179D Energy Efficient Commercial Buildings Deduction and the Section 25C Tax Credit for Qualified Energy Efficiency Improvements. The Trump Administration noted that these extensions do not indicate that comparable extensions will occur in the future.
