4410 Fairway Boulevard • Wichita Falls, Texas 76308 Phone (940) 692-2211 • Fax (940) 692-2214 Volume 4, No. 2 Wichita Falls, Texas February 2011 PRSRT STD US POSTAGE PAID WICHITA FALLS, TX PERMIT NO. 491 Reporter NORTH TEXAS HOME BUILDERS ASSOCIATION ADDRESS SERVICE REQUESTED North Texas Home Builders Association FEBRUARY 3, 2011 • 11:30 A.M. Wellington Banquet & Conference Center 5200 Kell Boulevard GUEST SPEAKER: U.S. Congressman Mac Thornberry General Membership Meeting
Transcript
4410 Fairway Boulevard • Wichita Falls, Texas 76308
Phone (940) 692-2211 • Fax (940) 692-2214
Volume 4, No. 2 Wichita Falls, Texas February 2011
PRSRT STD US POSTAGE PAID WICHITA FALLS, TX
PERMIT NO. 491
4410 Fairway Boulevard • Wichita Falls, Texas 76308
ReporterNORTH TEXASHOME BUILDERSASSOCIATION
ADDRESS SERVICE REQUESTED
North Texas Home Builders Association
FEBRUARY 3, 2011 • 11:30 A.M.
Wellington Banquet & Conference Center5200 Kell Boulevard
GUEST SPEAKER:U.S. Congressman Mac Thornberry
General Membership Meeting
DOUG McCULLOCHPresident
Hidden away in the Patient Protection and Affordable Care Act (PPACA) is a 3.8% federal sales tax on, in part, home sales and rentals. This “Medicare tax” is imposed on the lesser of “net investment income” or the excess of modified adjusted gross income over the “threshold amount.” It’s hard to imagine that adding a tax on any home sales will help the housing market recover. Or forcing landlords to raise rents by at least 3.8% to cover the taxes will help in any way. To be clear, this is not a sales tax on the sale of all homes. Most people who sell their home will not be affected.
What this provision of the healthcare bill actually does is create, code section 1411, additional “unearned income” tax for Medicare that begins in 2013. As Washington increases its attack on the upper middle class and others it considers “rich,” it decided to collect more of their investment income from real estate and other transactions. As such, the provisions apply to individuals earning over $200,000 or married couples earning over $250,000.
This tax is not calculated on the sales price of the home as many other articles may lead you to believe. It is based on the profit you realized from the sale of the home. As an example, if you paid $200,000 for the home, and sold it for $250,000, only $50,000 would be considered “gains.” This would create a tax due of $1,900. (3.8% x $50,000.)
Also, home sale exclusions still apply. So, if it meets the rules for being your primary residence for
income tax purposes, you can still exclude the first $250,000 in profits if you’re single and $500,000 in gains if you’re married. This has not changed. In the above example, if the home qualified as a primary residence, no tax would be due. Because of this exclusion, the bulk of the people getting hit with additional taxes will be investors or high earning taxpayers.
HEALTH REFORM REAL ESTATE SALES TAX
North Texas Home Builder Association members Smith’s Gardentown Farms and Christmas in Action were among the 2011 TORCH Award for Marketplace Excellence winners honored at the annual luncheon of the Better Business Bureau of North Central Texas on Tuesday, January 18.
Smith’s Gardentown Farms won in the medium business category, while Christmas in Action won for the nonprofit community service category.
Smith’s Gardentown Farms has been a family owned and operated business for more than 60 years. The third generation of the family now manages the business. Smith’s prides itself on environmental stewardship such as conserving the city’s resources.
Smith’s also has adopted the 82nd Medical Support Group at Sheppard Air Force Base. Additionally, the company has given its financial support to the Children’s Miracle Network, North Texas Rehabilitation Center, hands-to-Hands Community Fund, Wichita County Humane Society and several other charitable organizations.
Christmas in Action has been operating in the area for the past 28 years. The mission of Christmas in Action is to repair homes of low-income elderly and low-income
disabled homeowners within the county so they may continue to live independently in a safe and warm home. Since it was started, Christmas in Action has made repairs to more than 2,480 homes in the Texoma area.
Smith’s Gardentown Farms, Christmas In Action Honored as Torch Award Winners
Katherine Smith of Smith’s Gardentown Farms and Mark Masman of Christmas in Action are shown with their TORCH Awards at the Better Business Bureau luncheon held January 18 at the Wichita Falls Country Club.
BRYAN WAGGONER
3907 Kell Boulevard • Wichita Falls • Texas 76308(940) 691-3641
Kevin Hugman, assistant city manager, discussed code enforcement and the upcoming adoption of new international building codes at the January membership meeting of the North Texas Home Builders Association, held Thursday, January 6, at Coyote Ranch Resort.
He noted that the city staff has been busy reviewing new codes for adoption this year. Presently, the city operates under 2006 International Building Codes. “We have been gathering recommendations on all phases of construction including building, plumbing, and gas,” he told the gathering of approximately 100 persons.
The new recommendations will be made to the city council in February. He added that already permitted projects will remain under (and be completed using) the old building codes.
He also is recommending the requirement that contractors maintain liability insurance.
Hugman also discussed the land-use study at Sheppard Air Force Base. He said land use ought to be compatible with the mission of the base and also compatible with the public welfare and safety. “Sheppard Air Force Base is a vital part of our area’s economy. There are 12,000 persons on the base each day and the base’s annual payroll is more than $550 million. That means the base has an economic input into the local economy of more than $863 million. We do not want to give BRAC any more reasons to take missions away from Sheppard Air Force Base.”
Among the entities involved in the final joint land-use study are the base, the county, Wichita Falls, and Burkburnett.
He also noted that the city is interviewing candidates for the community development director’s position. This is the
position that Dave Clark held for many years before his retirement last year.
“The process opened in November and we hope to have a person in place by March.” He noted the city has received applications from 40 candidates.
He said, “Great customer service should be our goal. There is always room for improvement.”
Other changes include plans for bundled permits for new construction. “This will be more convenient for contractors.” This permitting process also will expand to remodeling projects and add-ons.
His office also is sending out a letter to contractors to sign up for e-mail updates. They also want to get feed back from customers to know where city can improve its service to the citizens of the community. They will be using a web based survey form and feedback will go to supervisors. “We want to promote communication between staff and customers.”
The city also will be hosting roundtable discussions once or twice a year. “We are working on the format and hope to implement them this year.” They also are looking at a thorough review of the city’s process review format. He invited city contractors, engineers, and architects to participate in the evaluation.
BUILDING CODES TOPIC OF JANUARY BUILDERS LUNCHEONBy Lee Grace
Kevin Hugman, assistant city administrator, center, is shown with Program Chairman Dennis Probst and Association President Doug McCulloch.
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LEGISLATIVE RALLY DAYWEDNESDAY • FEBRUARY 23, 2011
9:00 AM to 7:30 PMTEXAS STATE CAPITOL • 1100 CONGRESS AVENUE, AUSTIN TX 78701
Rally Day is one of the most important events our membership can attend, and we are looking forward to a tremendous turnout. The purpose of Rally Day is to deliver our legislative agenda right to the door of our State Representatives and Senators. Now that the 82nd Legislative Session has begun, the residential construction industry will face several serious challenges. As an industry, we must proactively inform elected officials of the consequences of passing over-reaching legislation that can have an overly burdensome and costly effect on Texas homebuilders and home buyers. Your strong support and grassroots action will be needed this session so we can accomplish our goals.
We need your help to continue to protect our entire industry, and ask that you make the commitment to travel to AUSTIN on WEDNESDAY, FEBRUARY 23 for RALLY DAY 2011 to be a part of this special—and effective—legislative event.
To Participate in Rally Day 2011, Please Register with your Local Association.
RALLY DAY REGISTRATION .....................................................................Wednesday, February 23, 2011 • 9:00 a.m. to 10:15 a.m. Located on the Capitol grounds under the white tents
OPENING REMARKS, GUEST SPEAKER AND LEGISLATIVE AGENDA .........Wednesday, February 23, 2011 • 10:30 a.m. to 11:00 a.m. South Steps of the Capitol
BARBEQUE LUNCH ................................................................................Wednesday, February 23, 2011 • 11:00 a.m. to 1:00 p.m. Grounds of the Capitol
Legislator Visits .....................................................................................Wednesday, February 23, 2011, 1:00 p.m. to 5:00 p.m.
Legislative Reception - Cost $20.00 ........................................................Wednesday, February 23, 2011, 5:30 p.m. to 7:30 p.m. Driskill Hotel Mezzanine
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