Federal Issues Committee
Marriott Hotel
San Carlos Room II – Mezzanine Level
Monterey, CA
Thursday, January 22, 2009

3:00 PM – 5:00 PM
 

Presiding:

Don Faught, Chair
Kathy Mehringer, Vice-Chair
Bill Stoll, Vice-Chair
Bill Jansen, Executive Committee Liaison
Allen Chiang, NAR Committee Representative

C.A.R. Staff:
Matt Roberts, Federal Governmental Affairs Manager
Jeff Keller, Public Policy Analyst

I. Opening Comments: Don Faught

II. Report of Action Items from Reporting Committees

A. Real Estate Finance
B. Taxation
C. Land Use and Environment
D. Equal Opportunity – Cultural Diversity
E. Housing Opportunity
F. Commercial Investment

III. Report from Healthcare Working Group

IV. Report on NAR’s GSE Restructuring PAG (Vince Malta)

V. First Impression Issues

A. Action Items:

1. Healthcare Reform

 In October 2008, the Federal Issues Committee created a Healthcare Working Group. This working group was charged with:

- Developing policy guidelines on healthcare issues that can be used to evaluate legislation as it is introduced.
- Analyzing legislation as it is introduced and reporting their recommendations to the committee.

With the issue of healthcare reform being addressed early in the upcoming Administration, the working group has met several times to put together a policy recommendation which will be brought to the Federal Issues Committee at the January 2009 C.A.R. Business Meetings. (Please see IBP for further information)

2. High-Speed Internet Access 
With the economy reeling and every industry looking for funds to help create jobs, high-speed internet access is being billed as an infrastructure project that would help create jobs, stimulate community growth, and benefit communities both currently and in the future.  (Please see IBP for further information)

B. Discussion/Reporting Items:

1. Net Neutrality
C.A.R. Policy: ”That C.A.R., in conjunction with NAR, support the following principles in any legislation to require broadband providers to adhere to net neutral practices:

1. Consumers are entitled to access the lawful Internet content of their choice
2. Consumers are entitled to run applications and services of their choice, subject to the needs of law enforcement
3. Consumers are entitled to connect their choice of legal devices that do not harm the network
4. Consumers are entitled to competition among network providers, application and service providers, and content providers
5. Network providers should not discriminate among Internet data transmissions on the basis of the source of the transmission as they regulate the flow of network content.”

The idea of net neutrality is that the Internet is open to all that are able to access it and that everybody able to access the Internet has equal availability to services and information.  These principles have guided the development of the Internet to date. Net neutrality principles calls upon designers of the individual networks, that together make up the Internet, to create their section of the Internet in a manner that allows any computer connected to the network to send information to any other computer on the Internet with minimal interference. A network designed to be perfectly neutral does not discriminate against any other network, hardware, software, language, culture, disability, or types of data.

There had been a building consensus about technology companies that net neutrality was needed to make sure that internet service providers (ISP) allowed all content to move open and free. 

However, there has recently been some changes in this consensus.  Microsoft and Yahoo have quietly withdrawn from the coalition supporting net neutrality and Google has starting approaching ISP about creating special rules for the content they carry.  These three companies have been the largest and most vocal supporters of net neutrality in the past.  Additionally, there is some belief that advisors to President Obama have been softening their views on net neutrality and that the President’s stance on the issue may be wavering as well.

VI. Taxation Issues
A. Discussion Items:

1. Withdrawing From 401(k) Plan Without Penalty
As the housing market has continued to face a tough decline, there has been a rise in homeowners that are finding themselves struggling to pay their mortgages.  These troubled mortgages are leading to an increase in loan modifications, foreclosures, and attempts to help people access cash to help save their homes.  One option mentioned is allowing homeownersto withdrawal from their 401(k), without penalty, to help pay their troubled mortgage.(Please see IBP for further information)

2.   Homebuyer Tax Credit
In 2008 Congress passed H.R. 3221, which included a first time homebuyer tax credit.  The tax credit was 10% of the purchase price, capped at $7,500 and did need to be repaid; therefore working more as an interest free loan than a true tax credit.  The credit is repaid out of your taxes over 15-years.  To use the credit the home must be purchased between April 8, 2008 and June 30, 2009 and be of an owner occupied primary residence.

While this credit is being used by many of those eligible, some in the housing industry want to see it expanded, in both size and scope.  There are numerous proposals being put out by mortgage brokers, builders, and even NAR.  NAR has proposed, as part of their 4-point plan, to extend the tax credit to all purchasers and extend the deadline for use as well as eliminating the repayment requirement.  Some builder organizations have proposed increasing the tax credit up to $22,000 as well as expanding its availability. 

With all of these proposals, nobody has indicated how they would like to offset the expanding cost of the program.  Additionally, Congress has given no indication that they plan on expanding the program.

3. Stimulus Package
The new Congress and Obama Administration have said that they want a stimulus package ready as early as January 20th.  Nonetheless, this will likely be an overly ambitious goal as it would mean that no committees could hold hearings; however, there is nevertheless a bipartisan agreement that a stimulus package in needed quickly. 

The size of this stimulus package has fluxuated and the final size is not yet known.  There is a general consensus that the package will be between $700 billion and $1.3 trillion.  This package should include tax breaks for the lower and middle class, funding for infrastructure, potentially money for cash-strapped states, and other projects that are believed to either stimulate the economy or create jobs. 

Included in the tax provision section could be $300 billion or more in tax breaks for individuals and businesses.  This could include: a tax credit on the first $8,100 of wages ($500 individual/$1000 couple), a decrease in the payroll tax, enhancements to the Child Tax Credit, allow the carry-back provisions to be extended to a 5-year period, extended bonus depreciation, and an extension of the small business expensing limit at $250,000.

There have also been discussions that any stimulus package would include some form of foreclosure mitigation and projects or incentives to help homeowners stay in their homes.  There has been no discussions on just what programs will be included, but some ideas floated around are: Interest rate buy-downs, bankruptcy reform, new tax incentives, and loan modifications guidelines.

B. Reporting Items:

1. Tax Extenders
The extension of temporary tax provisions has become a perennial cat and mouse game in Congress.  These extensions are popular among most members and include real estate provisions such as the 15-year leasehold improvement, Brownfield deduction, and state and local tax deductions.  These tax provisions are seen as “must pass” issues, but they have lately been used by Congress in attempts to sweeten more contentious bills.

These extenders are likely to lay dormant until it gets closer to the end of the tax year and the need to pass them is truly against the clock.

2. Tax Reform and AMT
As it has been with recent Congresses, the issue of overall tax reform and the AMT will rise from the ashes.  While the incoming Obama Administration has discussed certain changes to the tax code that would increase tax breaks for low and middle income taxpayers, they have also talked about allowing the Bush tax cuts to sunset as planned.  Whether this will be the extent of the tax reform in the first years or whether fundamental tax reform will be addressed is still unknown.  However, with the economy taking a downturn, it is likely that any fundamental tax reform will be put on a back burner.

Nonetheless, the issue of AMT reform will have to be addressed, whether in the form of another patch or in the form of elimination from the tax code.  The distaste for the AMT, and the acknowledgement that it is trapping taxpayers not intended to be included in the AMT, is bipartisan.  The debate becomes murky when the issue of how to offset the lost revenue of the elimination of the AMT is addressed.  The figures are about a $1.3 trillion loss over 10-years.  The question becomes how to either offset this loss of expected revenue or whether there should be no offsets.

With spending and deficits being increased through economic stimulus, there is a good chance that another patch will have to be passed in the first year of the 111th Congress instead of tackling the complete elimination. 

3. Real Estate Related Taxes
With the economy falling and stimulus and bailout packages increasing deficits, there is going to be reviews of current tax provisions in order to find new sources of revenue or ways of eliminating one tax provision in order to fund the creation of another.  Even with the housing market suffering, there are chances that certain real estate related tax provisions could be targeted, either as revenue raisers or in an effort to create a different housing tax credit, such as foreclosure mitigation.  Therefore, while no specifics have been mentioned, it is important to note that certain real estate tax breaks may be targeted, including second home mortgage interest deduction and the deduction of interest on home equity lines of credit.
 

4. Private Transfer Taxes
C.A.R. Policy: C.A.R. will take a “wait and see” attitude with regard to sponsoring legislation to prevent or regulate the imposition of PTTs.  Specifically, the sponsorship of any such legislation should occur if the makeup of the legislature changes significantly enough that it is politically feasible that the legislation will win approval.

At the November 2008 NAR meetings, NAR took the following policy:

“The National Association of REALTORS® opposes private real estate transfer fees. NAR believes such fees decrease housing affordability, serve no public purpose, and provide no benefit to property purchasers, or the community in which the property is located. Because private transfer fee deed restrictions are often difficult to discover, and therefore disclose, prior to a transaction, REALTORS® risk liability issues. In addition, deed restrictions imposing private real estate transfer fees will position affected properties at a disadvantage in the marketplace, and may well undermine economic stability.

Consequently, the National Association of REALTORS® is opposed to any initiative encouraging the recordation of any variety of deed restriction requiring the payment of a real estate transfer fee at closing to a third party entity, including, but not limited to, any individual, home owners' association, public or private for-profit or non-profit corporation, charity, or trust, or any division, department or agency of local or state government. Further, NAR encourages the enactment of statutes, ordinances, or regulations which would prohibit the use of any such deed restriction for the purpose of imposing private transfer fees.”

Further, in communities where private transfer fees currently exist, the National Association of REALTORS® urges their repeal and opposition to any increases.

VII. Real Estate Finance Issues

A. Action Item

1. Bankruptcy Reform (Please See IBP)

B. Discussion Items

1. 111th Session of Congress Agenda

a. Stimulus Package
As Congress meets for their 111th session they will begin by working to fix a U.S. housing market and an economy that many believe is the worse than at any time in history since the Great Depression.

In the hope of preventing another depression, Congress is expected to begin the 111th session with a large economic stimulus package. This package may cost taxpayers anywhere from $600 billion to $1.2 trillion and will likely include funding for various sectors of the economy that are struggling financially.
 

The stimulus package is expected to include:

• GSEs and FHA Loan Limits: On January 1, 2009, the GSEs loan limit was reduced from the greater of $417,000 or 125% of an area’s median home price capped at $729,750; to the greater of $417,000 or 115% of an area’s median home price capped at $625,500.  For the FHA the loan limit was reduced from the greater of $271,050 or 125% of an area’s median home price capped at $729,750; to the greater of $271,050 or 115% of an area’s median home price capped at $625,500.

C.A.R. is working with NAR and the California Congressional Delegation to retroactively extend the 2008 loan limits until the end of 2009.

Please see the attached list of California’s Metropolitan Statistical Areas and their 2008 and 2009 loan limits.

• Bankruptcy Reform: Bankruptcy reform is another issue that will likely be included in this package. If it is included there will be a very strong push by Democrats to include a provision giving judges the authority to cramdown mortgage principles for primary residences. Senator Durbin (D-IL) has already introduced his Bankruptcy Reform bill with Senators Boxer and Feinstein signed on as cosponsors.

• NAR’s Four Point Plan: At the NAR November Business meetings in Orlando, NAR released their Four Point Plan for the nation’s housing market. NAR has done a full Call-For-Action to get Congress to include their plan in any stimulus package passed.

NAR’s four point plan:

§ Make the $7500 first-time homebuyer tax credit available to all buyers and eliminate repayment requirements. The credit's limited availability and repayment requirement severely limit the credit's use and effectiveness.

§ Make the 2008 FHA, Fannie Mae and Freddie Mac loan limits permanent. New rules for 2009 will reduce them. Now is not the time to limit mortgage affordability.

§ Get the Treasury relief program back on track and target more funds to mortgage relief. Create a federal mortgage interest buy-down program to make below-market rates available and stabilize home prices.

§ Permanently bar banks from engaging in real estate brokerage and management. The banks have proven they have enough to do to simply manage the loan process. Banks should not manage home sales and purchases.

Congress is unlikely to address the banks in real estate issue in this legislation, and the interest rate buy-down may be done by regulators without Congressional action.
• Foreclosure Mitigation: Senator Dianne Feinstein has introduced legislation, and Representative Maxine Waters stated her intention to introduce a companion bill in the House, that codifies the FDIC mortgage workout program currently being utilized by IndyMac. The purpose of this would be to systemically target troubled mortgages that could be modified instead of doing them one at a time.

• Tax Incentives: Included in the tax provision section could be $300 billion or more in tax breaks for individuals and businesses.  This could include: a tax credit on the first $8,100 of wages ($500 individual/$1000 couple), a decrease in the payroll tax, enhancements to the Child Tax Credit, allow the carry-back provisions to be extended to a 5-year period, extended bonus depreciation, and an extension of the small business expensing limit at $250,000.
• Other: The package is also expected to provide funding for infrastructure projects, money for cash-strapped states, and other projects that are expected to either stimulate the economy or create jobs.

b. GSE Reform
The future of the government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac is expected to be addressed by Congress also. The questions facing Congress on the future of the GSEs, taken into government conservatorship in September of 2008, are daunting. Currently the GSEs own or guarantee approximately $6 trillion worth of home mortgages. Congress must determine if the GSEs and the government will play as large of a role in the future of the nation’s housing market and in what form. 

Some of the questions Congress will be forced to answer while determining the future of the GSEs include:

• Can the GSEs continue in a quasi private/public forms? 
• Should the GSEs be restructured in a manner that more closely resembles a public utility company?
• Does the market need both Fannie and Freddie? Or can they be combined?
• Are Fannie and Freddie salvageable? Or do they need to be eliminated and an entirely new entity created?
• What role should the government play in the future of the nation’s mortgage market? 
• What role should the government play in the current housing crisis?  Currently, many legislators are proposing the utilization of the GSEs in purchasing troubled mortgages from private lenders and having the GSEs burden the cost and work of loan modification.
• What role should the GSEs play in promoting “affordable housing”?

These questions are merely the tip of the iceberg on this issue. C.A.R. has and continues to support efforts by the government to ensure a strong and viable secondary market to the nation’s mortgage market. The current down market has demonstrated the need for a government presence in the mortgage market to fill the void created by the private market’s tightening of available capital.

c. Financial Regulation Reform
The issue of financial regulation reform is not a new issue.  Many administrations over the past three to four decades have advocated for the reforming of the nation’s regulatory structure that oversees the financial and lending industry. In March 2008, Secretary Paulson and the Treasury released a reform blueprint that would eliminate many regulatory agencies in an attempt to simplify and streamline the current structure.  Originally intended to help the U.S.’s financial system keep up with the rest of the world, reform is now seen as a necessity to ensuring safe and viable financial and lending markets. 

While the issue isn’t old, the current attempt by Congress to reform the existing structure is only in its infancy with hearings only now beginning to take place.  Currently, regulators oversee different depository institutions, insurance companies, companies that deal with securities and futures trading, and finance companies.  This has created an alphabet soup of regulators that has led to uneven playing fields for many companies, confusion for the public, and a sometimes slow and cumbersome response to any crisis.

Along with restructuring the regulatory oversight of these industries, Congress will be forced to address the question of what should be regulated. Once viewed as a wonderful marvel of financial innovation, derivatives and collateral-debt-obligations (CDO) are now widely viewed as being a major culprit for the collapse of many businesses.  While Congress can mandate these instruments now be regulated, Congress must create a system that will give flexibility and speed in analyzing the need for regulation of future financial instruments not yet created.  Some have called for a financial instrument safety regulator to determine the safety of new instruments; much like the FDA oversees the safety of prescription drugs prior to their availability.

2. RESPA
On November 13, 2008, HUD announced the release of their new RESPA final rule. There will be a one year implementation period with mandatory compliance beginning January 1, 2010. 

The purpose of RESPA is to provide consumers with information about the real estate mortgage transaction and the costs associated with it; and to prohibit certain practices, such as referral fees between settlement service providers, that result in higher costs and reduced quality to consumers.

Some changes to be implemented by the new rule include:

• New GFE (Good Faith Estimate) that incorporates the use of charts to give comparative information to consumers and imposes tolerances regarding the change in settlement charges at closing.  The GFE is now three pages and will be required by mortgage lenders and brokers effective January 1, 2010. 

• Three categories of settlement charges and subject them to different change tolerances. The first category of fees are subject to a zero tolerance standard and may not exceed their GFE estimate at closing (example: origination charge, transfer taxes).  HUD will subject the sum of the fees in the secondary category to a 10 percent tolerance.  While each individual fee may increase or decrease, the sum of the total increases may not exceed 10 percent at closing (example: government recording fees, settlement service fees).  The last category has no restrictions under the final rule, so they may increase by any amount between the GFE and closing (settlement services, daily interest charges, and homeowners insurance).

• Yield spread premiums will be required to be disclosed on the GFE.

• The HUD-1 is slightly altered to allow consumers to more easily compare their GFE fees to the final HUD-1.

• HUD abandoned their proposed idea of a closing script and will instead require consumers be given a new page three to the HUD-1 incorporating much of the information that was to be in the closing script.

It is unclear if the Obama Administration will make any changes to the new RESPA rule.  While lenders aren’t mandated to comply immediately, many will begin the process of compliance as it will take some time to make the necessary changes.

C.A.R.’s Member Legal Department will be creating a Legal Q&A.
 

C. Reporting Items

1. Flood Insurance
Unable to pass a National Flood Insurance Program (NFIP) reform bill, the 110th Congress passed a bill to temporarily extend funding for the bankrupt program until March 6, 2009.  With all that will be on the plate of the 111th Congress, it is unclear and unlikely that a full NFIP reform bill will be able to get passed prior to the expiration date.  This would require Congress to again extend the NFIP funding for another six-month or longer.

C.A.R. and NAR support Congress’ efforts to pass NFIP reform that would include wind coverage and keep the program solvent.

C.A.R. and NAR have serious concerns over any proposal that would eliminate subsidies for primary residences constructed in flood plans prior to the publication of the national flood plain maps.

2. Banks in Real Estate
On December 26, 2007, President Bush signed into law the FY2008 omnibus appropriations bill which includes a two-year provision prohibiting banks from entering the real estate brokerage, property leasing and management business. NAR was well position to secure a permanent ban. However, due to a last minute objection by Senator Robert Byrd (D-WV), Chairman of the Senate Appropriations Committee, the permanent language was struck and replaced with a two-year ban.  Senators and Representatives have committed to introducing similar legislation in the 111th session.

3. New HUD Secretary
In December, President Elect Obama announced he will be appointing New York City Department of Housing Commissioner Shaun Donovan as the new HUD Secretary.  Donovan has an extensive housing background that includes a prior stint at HUD as Deputy Assistant Secretary for Multifamily Housing, researching and writing about the preservation of federally-assisted housing at New York University, and working for Prudential Mortgage Capital as managing director of its FHA lending and affordable housing investments.

4. GSEs Appraisal Deal with NY AG
Fannie Mae and Freddie Mac (GSEs) reached a settlement on March 3, 2008 with New York State Attorney General Andrew Cuomo and the Office of Federal Housing Enterprise Oversight (OFHEO, now FHFA) establishing new appraisal requirements for mortgages the GSEs purchase.  The settlement was a result of Cuomo’s suit against First American for allegedly inflating the appraised values of homes.  Under the revised agreement released on December 23, Fannie Mae and Freddie Mac agreed to adopt a “Home Valuation Protection Code.” (Code). The Code establishes requirements governing appraisal selection, solicitation, compensation, conflicts of interest and corporate independence.

The following requirements will become effective May 1, 2009:

• The GSEs will require appraisals not be provided by mortgage or real estate brokers.
• The GSEs will also require that the lender or broker do not use an in-house, affiliate, subsidiary or other entity owned by the lender or broker to perform the appraisal. Some exceptions apply to the in-house appraiser prohibition. For example, lenders may use in-house staff appraisers to develop or use internal automated valuation models, or prepare appraisals for transactions other than mortgage origination transactions (e.g. loan workouts).
• The lender must provide the borrower with a free copy of the appraisal report immediately upon completion and no less than three days prior to the closing of the loan. The borrower may waive this three-day requirement.  However, the lender may require the borrower to reimburse the lender for the cost of the appraisal.
• It prohibits anyone on the lender’s loan production staff from selecting or communicating with an appraiser., appraiser company or appraisal management company relating to or having an impact on valuation or to provide information to the appraiser that has been given the assignment before completion of the assignment
• Lenders must establish a telephone hotline and an email address to receive complaints from appraisers, individuals, or any other entities concerning improper influencing of appraisers or the appraisal process.
• Required Notices: Lenders must provide a separate notice of the hotline and email to appraisers they use AND to borrowers about the services provided by the Independent Valuation Protection Institute.

A lawsuit has been filed to stay the implementation of the new appraisal deal by the National Association of Mortgage Brokers. The agreement terminates 28 months from the date of execution (i.e. July 2010).

VIII. Land Use & Environment Issues

A. Discussion Items

1. Regulating Emissions through the Clean Air Act

In 2008 there was a Supreme Court case, Massachusetts v. EPA, in which the court found that the Clean Air Act (CAA) can be used to regulate Green House Gases (GHG) because they met the definition of an air pollutant under the CAA.  However, the Environmental Protection Agency (EPA) was not forced to adopt this decision; rather they were ordered to investigate whether they should use the CAA to regulate GHG and if they should not, then why.

Recently, the EPA issued an Advanced Notice of Proposed Rulemaking (ANPR) in order to comply with the court ruling, but was not intended as a first move to start regulating GHG under the CAA.  Most responding agencies said that the CAA was an ineffective and expensive tool to fight GHG and that Congress needs to address comprehensive climate change reform and create a new regime to approach the issue, not simply try to apply old regulations to a new situation. They also stated that there would be a large increase in costs to industries that are not normally covered under the CAA, which would lead to a reduction in steps already taken to reduce GHG and the possibility that any costs would be passed to consumers who are already suffering in the current economic situation. 

Nonetheless, there could be further attempts through regulation or even legislation in the 111^th Congress to change this and have the EPA address the issue of GHG using the CAA.
 

This applies to REALTORS® because if the EPA decided to regulate GHG through the CAA it could include “…smaller stationary sources that also emit GHGs –such as apartment buildings, large homes, schools, and hospitals.”  This would mean that real estate in the commercial sector, multi-family housing, and even some residential housing could now find their emissions, in both new construction and upgrades, fall under the CAA and therefore be forced to endure the added costs of CAA permits, studies, and fees.

With the change in administration, the issue will ultimately fall under the purview of President Obama’s nomination for EPA Director, current New Jersey environmental protection commissioner, Lisa Jackson.  President Obama has sent a clear signal that he intends to take climate change seriously.  However, it is not clear yet if he will pursue this through Congress first, through the regulatory agencies, or through both simultaneously.
 
As this was just an ANPR, there is no new proposed rule.  We will be on the look-out for any proposed rules under the Obama Administration concerning this issue. 

B. Reporting Items 

1. Climate Change

C.A.R. Policy: In 2001, C.A.R. adopted the following Energy Policy Guidelines: 

“Introduction:

While REALTORS® are not experts on the complexities of the energy issue, it is appropriate for C.A.R. to be involved by assessing energy-related proposals for their impact on property owners, housing affordability and the business environment.

Major Issue Areas for REALTORS® Involvement

1. Increasing Energy Supply
Support financial incentives for residential and business property owners who purchase and install on-site, power-generating energy systems, such as photovoltaic, solar and wind.  Such incentives include tax credits, low interest loans and rebates.

Support financial incentives for cities and counties who site new power plants, and retrofit existing plants to meet current environmental standards, within their jurisdictions.  Such incentives include rewards from the state general fund, and the ability of cities and counties to keep a substantial amount of the property tax derived from such plants.

Support a streamlined, expedited process for approving new plants, and retrofitting existing plants.

Support the upgrade of existing energy transmission systems.

Oppose proposals that mandate on-site energy systems on private property without regard to environmental or cost effectiveness.

2. Reducing Energy Demand

Support financial incentives for residential and business property owners who retrofit their properties to be more energy efficient.  Such incentives include tax deductions/credits, low interest loans, rebates and exemptions from property tax reassessment.

Support consumer education and advertising of the benefits of energy conservation, including the incentive programs available from the state and energy utilities.

Support proposals to base the utility user’s tax on the energy used instead of the total dollar amount of the consumer’s energy bill.

Support the investigation of innovative ways to reduce peak energy use in existing residential and commercial buildings
.

Oppose mandates that would require energy conservation retrofit at the point of sale of real property.

3. Creating an Equitable and Reliable Energy Market

Support a more efficient, reliable market for energy that stabilizes consumer costs and strives for financial parity between residential and business users.

Support prudent action by the state to achieve lower energy prices as new production comes on line.

In recognition of the state having taken the unusual step of buying energy during the crisis, the ultimate burden of retiring the debt should be borne equitably statewide.”

At the November 2008 NAR meetings, the following policy was taken:

“The National Association of REALTORS® is committed to the principles of sustainability and energy conservation, the benefits of which will preserve our environment and support our nation as a vibrant, healthy and prosperous place to live and work. While scientific research and debate on global climate change continues, government is promulgating laws and regulations with significant and far reaching implications for the real estate sector.

NAR’s commitment to the environment is clearly visible in its Washington, DC office building, the first commercial building in the nation’s capitol to be LEED Silver certified. NAR’s Green Designation program will educate REALTORS® to benefit their clients with energy efficiency and sustainability expertise. NAR’s Smart Growth program has provided grants and technical assistance for Smart Growth initiatives in communities nationwide.

To help advance an economically prosperous and environmentally sustainable future, NAR is committed to supporting all commercially reasonable strategies with voluntary, performance-based incentives to reduce greenhouse gases. Market-based, cost effective solutions energize the nation’s entrepreneurial spirit and innovation in cutting emissions.

Development of public global climate change policy should be guided by the key principles of protecting private property rights, maintaining housing affordability and availability and NAR Smart Growth principles, which accommodate commercial and residential growth. Because environmental initiatives and responsible development are not mutually exclusive, those initiatives should not be barriers to the ability to own, use and transfer property.

We support regional, state and local approaches based on market principles to reduce greenhouse gases and to conserve energy.

We support solutions that encourage sustainable practices and energy efficiency through incentives such as expedited permitting and tax credits. We support voluntary programs and investments that incentivize retrofits, transportation, infrastructure, water availability, and risk management with regard to public global climate change policy.

We oppose transaction triggered mandates.

We oppose requirements that impose undue economic impact on property owners and managers.

We oppose the expanded applications of existing laws or regulations that were not designed to address global climate change.

NAR supports educating real estate professionals, real estate owners, developers, managers, tenants, occupants, lenders and investors regarding the benefits of voluntary, market-based reductions in greenhouse gases and energy conservation.”

As the NAR policy does not conflict with the current C.A.R. policy, there is not a need at this time for C.A.R. to revisit our policy unless the membership wishes to.

IX. New Business 

1. How a Bill Becomes Law (Please see IBP for more information)
2. Government Acronyms

X. Adjournment