n Victory comes days after BIAW files lawsuit 

Just days after BIAW filed a lawsuit in federal court, Governor Gregoire has announced that she is requesting the Washington State Building Code Council (SBCC) delay the implementation of the new energy code for a period of nine months. 

While BIAW and other coalition partners have been lobbying the SBCC and the Gregoire Administration to rethink these energy code regulations for over a year, the decision was made just days after BIAW made good on its previous threats to challenge the new rules in court. In November of last year, BIAW attorneys warned the SBCC that their proposed changes to the energy code were pre-empted by federal law, and thus illegal. 

In the lawsuit filed in federal court on May 26, BIAW and several HVAC contractors and builders(including several NCHBA members) alleged these regulations will lead to loss of sales and related activities as consumers choose not to buy new homes, or simply are not able to buy new homes because they will be priced out of the market, hurting an already fragile homebuilding industry.

In her letter to the SBCC requesting the delay, Gregoire said “it is clear that the recovery of the construction industry is central to the recovery of our state’s economy” and a “delay is necessary to allow the construction industry to stabilize.  We cannot risk further delay of our state recovery, or worse, a deepening recession.” Ironically, Gregoire’s request for the delay comes after her repeated direction to the SBCC over the past year to press forward with the stringent new energy efficiency regulations.  

While Gregoire has officially requested the SBCC delay implementation, the delay will not take effect until the SBCC takes action.  The SBCC is scheduled to convene this Friday; presumably Gregoire’s request will come up during this meeting.  While the battle to repeal the new energy code is not over, clearly a nine-month delay is a small victory.  BIAW will continue its proceedings in federal court, asking the judge to strike down the regulations and start over. 

May 17, 2010

        ECONOMIC IMPACT STUDY SHOWS HOME BUILDING PAYS ITS WAY IN WENATCHEE, WA

WENATCHEE - An economic impact study conducted by the National Association of Home Builders (NAHB) Housing Policy Department shows that Wenatchee's home building industry not only pays for itself, its economic impact results in new income and jobs for Washingtonians and additional revenue for local governments.

Every representative 100 single-family and 15 multifamily homes that were built across the metro area in 2009 will generate a cumulative $25.2 million in revenue, compared to $10.5 million in costs over the next 15 years. By the end of the first year the housing industry's economic impacts more than offset the fiscal costs resulting in a fiscal surplus to local governments. And, by the end of the first year the fiscal surpluses generated are more than enough to pay off all debt and result in a surplus available to pay for additional government services. Single-family and multifamily housing produces a net income to local governments of $4.0 million the first year and $771,500 each and every year thereafter.

"These results show that home building is more than paying its own way and should put to rest the notion that existing home owners are subsidizing new home construction here in Wenatchee," said Dr. Elliot Eisenberg, the Senior Economist who conducted the analysis of the impact of home building in the Wenatchee, WA  MSA.-which encompasses both Chelan and Douglas Counties.  "This is an excellent result and tells me that local residents should be thanking the building industry for footing the bill for a lot of services."

The economic impact study looks at the impact of the construction industry in three phases: the construction phase; the ripple effect; and, the occupancy phase. The impact of the three phases are added up, and then compared to the cost of services such as education, fire, police, utilities, parks and recreation and roads that are required to support the new housing units.

During the construction phase, the building of every 100 single-family and every 15 multifamily homes creates 321 jobs (221 jobs in construction alone), generates $3.6 million in local taxes and $17.0 million of local income in the first year. The ripple effect of those homes, which includes the wages and profits local area residents earn during the construction period that are spent on other local goods and services, results in 182 jobs, $1.4 million in local taxes and $8.8 million in local income, also in the first year.  The ongoing annual effect of those homes, which includes local jobs, income and taxes generated as a result of the home being occupied, is 77 jobs, $1.4 million in local taxes and $3.5 million in local income per year.

"It is important for us to look closely at these numbers," said NCHBA President Dustin Christensen. "We've been saying for a long time that local home builders are doing their part to build community, and these numbers show that we are a very important player in the overall economic health of the Wenatchee economy." The NAHB model used to determine the economic impact of the housing industry was first developed by NAHB in 1997 and has been applied to construction in more than 530 areas of the country. This study looks at the economic impact of collectively building 100 average priced single-family homes and 15 average priced multifamily homes in the Wenatchee, WA MSA.

Complete copies of the study are available by contacting the NCHBA at (509) 665-8195.

The North Central Home Builders Association (NCHBA) is a non-profit trade association representing more than 500 member companies who employ more than 5,000 people in the North Central Washington area.  NCHBA members include residential builders, remodelers and all the various specialty trade businesses related to the housing industry. Learn more at http://www.nchba.cc/

The NCHBA would also like to recognize and thank the North Central Washington Association of Realtors and the North Central Washington Economic Development District for their assistance and support in helping to make this study possible.

# # #

OLYMPIA-The Building Industry Association of Washington has filed an initiative with the Secretary of State allowing private insurers to compete with the state Department of Labor & Industries (L&I) to offer employers workers' compensation coverage. 

"BIAW warned that if the Legislature refused to do anything this session to reform our state's broken and nearly bankrupt workers' compensation system, BIAW would," said BIAW President Matthew Clarkson.  "BIAW's initiative makes good on that promise."

Initiative 1082 will bring Washington State in line with the 46 other states that allow competition from private insurers in the industrial insurance market.  Washington's monopoly on workers' comp means employers have no choice but to pay L&I's ever-increasing workers' comp taxes to obtain the industrial insurance coverage they need to protect their workers. 

The result has been a costly and inefficient workers' comp system on the verge of insolvency.  While workplace injuries have decreased 55 percent in recent years, L&I's costs to manage these fewer injured worker claims have increased by more than 80 percent, and injured workers stay off the job more than two times longer in Washington than any other state.  Thanks to L&I's inability to efficiently manage the workers' comp system, employers in Washington State have shouldered workers' comp tax increases of 54 percent over the past decade and now pay the second-highest cost per employee for workers' compensation-and they are facing double-digit workers' comp tax hikes next year.

I-1082, which has already been endorsed by the National Federation of Independent Business, ends the state's monopoly on workers' compensation and injects much needed competition into Washington's failing system.  The initiative creates a Joint Legislative Task Force on Private Competition for Industrial Insurance charged with developing proposed legislation to conform current statutes to the provisions of the initiative and make recommendations by December 2011.  The Legislature must adopt legislation to fully implement the policy directives of the initiative by March 1, 2012. 

The initiative also eliminates the worker-paid share of workers' comp taxes, leaving workers with more money in their paychecks.  Washington is the only state that allows employers to deduct a portion of workers' comp taxes from employee's wages.  I-1082 will require employers to pay the full amount.

"The provisions of I-1082 are a win-win for businesses and their workers," said Clarkson.  "Allowing private insurers to compete with L&I will create a more business friendly environment that will give existing Washington businesses some much needed relief and help attract new businesses, while scrapping the arcane rule that forces workers to pay workers' comp taxes will put more money in the wallets of working families." 

BIAW, along with most of the business community, has pleaded for workers' comp reform for years.  Boeing specifically identified Washington State's unreasonable and costly workers' comp system as one of the reasons they awarded South Carolina the second production line of the 787.  Despite these pleas, no changes have been made and costs have continued to spiral out of control.  

Meanwhile, other states that have moved from government-run workers' comp systems to privatization have experienced lower workers' comp taxes for employers, better claims management for injured workers and a more efficient workers' comp system.  Oregon, West Virginia, Nevada, Maine, North Carolina, Colorado and California are just a few of the states which allow private insurers to sell workers' comp policies whose workers' comp rates decreased this year.  Contrast to Washington's 7.6 percent increase this year-the biggest workers' comp increase of any state in the country.

"Monopolies don't work, especially government monopolies," said Clarkson.  "Monopolies breed incompetence, inefficiency and lack of accountability," he said.  "Forty-six states have figured this out; it is time for Washington to do the same."

For more information on I-1082, visit www.SAVEOURJOBSWA.com.

Policies that increase tax revenues and regulate the growth of communities have a direct impact on the cost of construction in our state. Lawmakers use a variety of tools to control growth and manipulate revenues, such as building, utility and impact fees, land use regulations and business taxes. The increased costs effect businesses ability to remain competitive, as well as the price that consumers must pay for the goods and services provided. Click here to read a report by Brandon Housekeeper, a policy analyst for the Washington Policy Center.

Olympia, Washington

Published Friday, January 15, 2010

‘Public hearing was proof the Department of Fish and Wildlife is out of touch with rural Washingtonians,' says Kretz

In a public hearing in the House Agriculture and Natural Resources Committee on Jan. 12, Rep. Joel Kretz, R-Wauconda, was appalled by the attitude of state wildlife official, Steve Pozzanghera, when discussing bills to curb the trend of massive land purchases in the 7th Legislative District.

The committee heard two of Kretz' bills to help end the mismanagement of noxious weeds on state land, which are spreading to private property (HB 2446), and to require the Department of Fish and Wildlife (DFW) to work with local governments to seek approval of land purchases (HB 2485). Both bills were opposed by the DFW and The Nature Conservancy.

"The public hearing was proof the Department of Fish and Wildlife is out of touch with rural Washingtonians," said Kretz, who serves on the agriculture and natural resources committee. "The Seventh District has enough land ‘conserved' for wildlife, fishing, hunting and recreation. I wish the department would start buying land in King County the way it has been scooping up property for state lands in Okanogan and elsewhere in our district."

He noted that 69 percent of state land acquisitions by the DFW last year were in Okanogan County.

"One county cannot take this type of hit," said Kretz. "How much is enough? Our rural communities are struggling under a depressed economy and the department seems content to scoop up land, taking it off the tax rolls, which hurts local governments, cuts critical services and runs agriculturists out of the county. To top it off, wildlife officials put words in local county commissioners' mouths when none of them were there to dispute what was being said about their support or rejection of the proposals."

Kretz feels DFW has an attitude that rural property owners should feel lucky their land is being taken care of by state government. But, he noted, the reason fish and wildlife continues to buy up land in the district is because farmers, ranchers and orchardists keep it pristine.

At one point in the hearing, Kretz told DFW he was insulted by the notion that bureaucrats think they know what's best for the 7th District. To make matters worse, he said, Steve Pozzanghera is likely going to be appointed as the Region 1 director of DFW, which includes all of Ferry, Stevens, Pend Oreille, Lincoln, Spokane, Garfield, Whitman, Walla Walla, Columbia and Asotin counties along with part of Okanogan County.

"The department bragged in the hearing that it received $243,000 for land acquisition in the 2009 budget and the governor's proposed 2010 budget includes an additional $264,000 to purchase land. All the while, the governor is complaining that the budget is ‘unjust,'" Kretz said. "I would suggest the DFW budget is unfair and unjust for the citizens of the Seventh District. If this plan of buying up land is so great, why not share the love in King and Pierce counties?"

Pozzanghera contacted Kretz via e-mail asking to schedule a meeting where they, "dress up in jeans and flannel shirts" to discuss things that were said in the Jan. 12 hearing.

"I'm tired of DFW's arrogance. I'm tired of them talking down to rural people," Kretz fumed. "For him to suggest we dress up in jeans and flannel shirts to discuss the insulting business that took place is, on its own, insulting! Most rural people are perfectly able to carry on an intelligent discussion regardless of apparel. Besides, flannel is so ‘out' in Wauconda this year."

The Nature Conservancy also testified against Kretz' bills. The group, he said, speaks in code words and phrases they think rural folks are too stupid to catch. One code phrase Kretz noticed alluded to moving forward with a "wildlife corridor" through the district, which sounded eerily familiar to the Yukon to Yellowstone (Y2Y) legislation introduced the past several years.

"There are a number of DFW personnel and environmental advocates who have a consistent record of arrogant and insulting comments directed at rural residents, and the officials they elect to represent them. Their message seems to be ‘we are smart, you are stupid and ignorant, and we know what's best for you.'  Folks, I've had enough," Kretz said. "Every two years, more than 120,000 people have the option to keep me in office, or show me the door. I refuse to have unelected government employees and environmentalists tell me what's good for the people of my district when I know what folks want because they are not shy about speaking their minds. My job is to listen to residents in the district - DFW would do itself a favor by doing the same thing."

Wildlife officials like Pozzanghera should move to Colville and run for office, Kretz suggested, if they think their policies are so popular in the 7th District.

"I don't mind a discussion, and I'm always game for a healthy debate of ideas, on which we can respectfully disagree. But the words, tone and arrogance displayed by the DFW and The Nature Conservancy during this hearing was unbelievable," Kretz said. "It was a glimpse of what they really think of rural citizens."

Kretz said he's not backing down on this issue of turning the entire 7th District into, as former governor Mike Lowry called it, a "playground" for the Western Washington elite.

"Enough is enough. I am not going to stand by and have the citizens of the Seventh District, or any other rural part of the state, treated like they are not worth respecting," Kretz explained. "I hope the folks in the district rise up as well to share their thoughts with the Fish and Wildlife Commission."