In a big victory for the apartment industry, on July 15 EPA rejected its own proposed rule that would have mandated additional responsibilities for property owners and managers under the Lead Renovation Repair and Painting (RRP) rule.

The proposal would have required on-site maintenance staff and third-party contractors who engage in activities that disturb surfaces that may contain lead to replace simple post-renovation field tests with more expensive requirements to submit dust samples to an EPA-accredited lab for lead testing.

In comments on the original proposal, NAA/NMHC argued that the existing lead-safe work practices and detailed clean-up requirements, which went into effect in 2010, are sufficient.

EPA’s own studies concurred, and the Agency has thus allowed the existing field test protocol to remain in place.  More information, including the final amendment and a link to an NAA/NMHC RRP guidance document, is available at  http://tinyurl.com/4td5kr .

Lawmakers are racing towards an August 2 deadline to raise the nation’s $14.3 trillion debt limit while at the same time enacting fiscal reforms to address the federal debt crisis. The Administration and some in Congress are advocating for the inclusion of tax increases in the final package of reforms, including an increase in the taxation of a carried interest. As you know, the use of a carried interest is a long-standing financing model that rewards entrepreneurs who take on significant risks in developing or rehabilitating apartment communities.

However, if enacted, this tax increase on a carried interest could be potentially devastating for the apartment industry.

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The gavel slammed down on May 11 ending the 120 day Session of the 68th General Assembly.  Republicans controlling the House and Democrats the Senate proved an effective method of disposing of extreme bills.  Legislators were forced to moderate and find compromise on many pieces of legislation.  However, the split chambers ensured partisan bickering over big ticket items including the budget and redistricting.

The continued revenue shortfall gave Governor John Hickenlooper an opportunity to prove his leadership skills as he successfully navigated his first major challenge in pushing a balanced budget. The Governor often teamed with Speaker Frank McNulty and sparred with Senate President Brandon Shaffer.   Major legislative accomplishments this session included:

  • Passing a balanced budget with a package of pro-business bills.
  • Creating the Colorado Health Benefits Exchange to provide access tohealth insurance (SB 11-200);

Budget woes once again set the tone this legislative session.  After months of negotiations with the Governor, the legislature passed a budget that will guide the state’s roughly $18 billion in state expenditures for the 2011/2012 fiscal year.

The split chambers definitely proved beneficial to the residential real estate industry, setting the stage for a bit calmer session than in recent years.  Although a couple of bills were introduced early in the session that would have adversely affected apartment owners statewide, these bills were easily disposed of in their first committee of reference.  HB 11-1214 would have required landlords of multi- and single-family residential dwellings to disclose energy use or efficiency information to potential tenants and HB 11-1147 would have limited landlords’ use of consumer credit information of a potential tenant only to evaluating the applicant’s payment history for prior tenancies.  Both were dead by mid-February.

A bill was introduced late in the session that would have regulated roofers in a manner that could have limited competition and otherwise adversely affected property owners.  This bill died on the Senate floor.  However, an attempt to appeal a bill passed last year regulating sprinkler fitters failed to make of the Senate Appropriations Committee (after passing through the House), even though it had a positive fiscal note, proving that the divided government while usually helpful, can also make it more difficult to pass desirable legislation.

Issues we had a much-appreciated reprieve from this year include warranty of habitability and rent control, just to name a couple.  All in all the 2011 Legislative Session was quite successful for the Apartment Association and the industry as a whole.

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As a follow up concerning the Consumer Product Safety Commission’s (CPSC) voluntary recall of pool/spa drains from eight manufacturers, CPSC Commissioner Inez Tenenbaum offered additional information to pool owners on how to respond.

In a Memorial Day weekend speech, Tenenbaum said that operators of kiddie pools, wading pools and in ground spas should immediately assess whether their pools are equipped with a cover made by one of the identified manufacturers. If they are, they should:

1. Contact the manufacturer right away. Note that not all drain covers are impacted. The manufacturer will help you determine if your drain covers are covered by the recall and help you secure a replacement if they are.

2. If a replacement cover is necessary, you must close your pool until the necessary work is completed.

However, pools with multiple drains or gravity drainage systems do not have to replace their covers.

The U.S. Consumer Product Safety Commission (CPSC), in cooperation with eight manufacturers, has announced a voluntary recall of several pool and in-ground spa drain covers.

The recalled drain covers were incorrectly rated to handle the flow of water through the cover, which could pose a possible entrapment hazard to swimmers and bathers.

Since this recall coincides with the opening weekend for many apartment pools, we wanted to make sure you were notified of the issue.

A CPSC press release ( http://1.usa.gov/jMK4q6 ) lists the eight affected manufacturers and offers additional information. The recall applies to drain covers manufactured AFTER December 19, 2008.

 

According to the CPSC release, pool owners/operators who have one of the recalled pool or spa drain covers should immediately contact the manufacturer to receive a replacement or retrofit, depending on their make and model. Except for kiddie pools, wading pools and in-ground spas, retrofit or replacement of installed covers are not required in pools with multiple drain systems or gravity drainage systems or for covers installed before December 19, 2008.

Apartment firms are encouraged to contact the Drain Cover Recall Hotline toll-free at (866) 478-3521 any time or visit the Drain CoverRecall website at http://www.apsp.org/draincoverrecall ( http://www.apsp.org/draincoverrecall ) for additional information.

 

Visit the Colorado House of Representatives in a unique, personal, and casual atmosphere. Visit with your local lawmakers in their offices, sit inside the House Chambers and get a complete behind the scenes look at your state government at work.

Wednesday, April 13, 2011
5:00pm – 7:00 pm
Colorado State Capital
200 E. Colfax Ave.
Denver, CO

Light refreshments will be available.

Click here to RSVP.

The public entrance is through the south basement doors. Metered parking is available all around the Capitol and a paid parking lot is location on Grant Street between Colfax and 14th.

On April 6, a key House subcommittee passed eight Republican-sponsored bills to begin winding down Fannie Mae and Freddie Mac. The votes followed an 11-hour markup the day before during which Democratic members of the subpanel repeatedly criticized Republicans for acting too quickly and taking short-term steps to dismantle the GSEs without having a vision for what should replace them. Such a move, they claim, could further destabilize the housing sector and the economy.

Chairman Bachus Recognizes Multifamily

As reported in the April 1 AIMS Update [ http://tinyurl.com/4td5kr ] the eight bills passed last week largely address problems in the GSEs’ single-family businesses. NAA/NMHC are actively working with lawmakers to prevent unintended consequences that could negatively impact multifamily liquidity.

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NAA/NMHC secured one of our top legislative priorities on April 5 when the Senate voted 87-12 to send legislation (H.R. 4) to President Obama to repeal onerous 1099 reporting requirements enacted as part of last year’s health care reform law (P.L. 111-148). The House passed H.R. 4 on March 3.

Although President Obama has objected to the offset used to pay for the cost of repeal (targeting excess health insurance subsidies paid to individuals), he is expected to allow it to become law.

Under current law, businesses must send Form 1099s to all individuals who provide the firm with more than $600 worth of services in a calendar year. Left unchanged, the health care reform law would have greatly expanded the requirement as of 2012, creating a significant compliance burden for apartment firms and other businesses. First, payments made to corporations would no longer be automatically exempt from the reporting requirement. Second, the requirement would apply to the purchase of goods as well as services.

H.R. 4 also repeals separate 1099 changes enacted last year under a small business law (P.L. 111-240). Those changes require passive real estate owners to comply with all present-law 1099 requirements. That provision went into effect in 2011. More information on the 1099 requirements, including an NAA/NMHC analysis of them, is available at http://tinyurl.com/4td5kr .

ColoradoPols has released the results of polling conducted by Denver-based RBI Strategies & Research. The results show former State Senator Chris Romer with a solid lead, but perhaps more importantly, he is the only candidate with any real name recognition. Romer’s total favorable rating is 40%, while the next closest candidate is James Mejia at 26%. Favorability ratings for Michael Hancock (22%), Doug Linkhart (21%) and Carol Boigon (19%) are incredibly low this close to election day.

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As NAA/NMHC predicted, the issue of GSE reform will be the subject of many hearings  this Congress.  Three hearings have been held already in the House, and on March 15, the Senate Banking Committee held its first hearing.  Treasury Secretary Timothy Geithner and HUD Secretary Shaun Donovan were the only witnesses at the session, which focused on the Obama Administration’s blueprint for winding down Fannie Mae and Freddie Mac.  (An NAA/NMHC analysis of the Administration’s plan is available at  http://tinyurl.com/4td5kr .) 

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