The election and you!
Hello Apartment
Industry Advocates!
With the election a
mere five weeks away, it seems appropriate to devote this edition of the
Apartment Industry Mobilization Service (AIMS) communication to our role as
advocates for the apartment industry in the upcoming election.
There is no denying
it – this year’s election has the capacity to impact every level of government.
Not only will control of the White House and House and Senate be decided on
Election Day, but 11 governors and numerous state legislatures, city councils
and mayors’ races, 166 statewide initiatives in 35 states and a staggering
number of local community questions will also be determined.
Although media
attention may be focused on the presidential election, virtually everything
federal, state and local policymakers do, or don’t do, impacts your business and
your bottom line. So, no matter which side of the political aisle you’re on,
your participation and vote on all these ballot items are vital to our
industry.
So what can you
do?
Use the days before
the elections to make your case for the apartment industry.
Go to town hall
meetings, political events and parades and educate Congressional candidates on
the issues important to our industry. Elected officials will be making important
decisions during the post-election “lame-duck” session and beyond. The number
one issue on the table during that session is the expiration of the 2001 and
2003 tax cuts.
NAA and NMHC believe
that Congress must extend these tax cuts. If Congress fails to act, there will
be significant consequences for our members and the broader economy. The
Congressional Budget Office estimates that expiration of the present-law tax
rates combined with the proposed sequestration (across-the-board budget cuts)
will cause the economy to contract 0.5 percent which will cause unemployment to
rise to more than 9 percent by this time next year.
Looking ahead to
2013, the work only gets more challenging. We are focused on three key issues:
Tax
Reform. Many apartment
firms are organized as so-called “flow-through” entities (LLCs, partnerships and
S Corporations). We must ensure that these businesses don’t end up double taxed
as corporations or, alternatively, aren’t forced to endure a tax increase to
finance a lower corporate rate.
Congress must also
maintain the business interest deduction which is critical to smaller apartment
firms that cannot access Wall Street or other equity sources. Likewise, the
capital gains rate and carried interest are equally important to the future of
the multifamily industry. Lastly, the Low Income Housing Tax Credit program
must be preserved as an important tool for ensuring the availability of much
needed affordable and workforce housing.
Housing Finance
Reform. Policymakers of
all stripes have made clear that Fannie Mae and Freddie Mac cannot survive in
their present forms. Consequently, we are encouraging them to enact a housing
finance reform solution respecting the unique needs of the multifamily
industry. To that end, we are crafting a plan that will keep
government-guaranteed capital flowing to all markets at all
times.
Federal Regulatory
Burden. As everyone is
acutely aware, many federal regulations cost us money and are often simply not
worth the price. So we are focused on making sure regulations targeting
accessibility, fair housing, energy and the environment, labor policy and
telecommunications, among other priorities, do not unduly impact the multifamily
business and the providers of much needed apartment homes.
As you can see, this
is a crucial time for our industry. Over the coming weeks prior to the
election, we encourage you to talk to the candidates running in your home state
and localities. Educate them about the multifamily industry and the vital role
we play in communities nationwide and then ask them where they stand on the
issues important to our industry.
For starters, you
might want to ask them these questions:
Tax
Reform. Tax
reform is likely to be front-and-center on Congress’ agenda next year. Many
owners, operators and developers of apartment housing organize themselves as
pass-thru entities (i.e., sole proprietorships, LLCs, partnerships, and S
Corporations) and pay tax as individuals. Furthermore, many in our industry
borrow to finance the construction of new apartment buildings because they are
too small to access equity markets. The business interest deduction is an
important tool for smaller firms. Will you support preserving the ability of
real estate pass-thru businesses to file taxes under the individual income tax
system, and would you support retaining the current deduction in the tax code
for business interest?
Housing
Finance Reform. Fannie
Mae and Freddie Mac (GSEs) have been an important source of capital for the
apartment industry. While we recognize that the GSEs cannot survive in their
current form, can you commit to working with us on crafting housing finance
reform legislation that both respects the unique needs of the multifamily
industry and ensures that capital is available in all markets at all times?
Federal Regulatory
Burden. What is your view of
the appropriate balance between government regulation and enabling private
business to thrive and drive economic growth and job
creation?
For additional
information on the apartment industry’s priorities, please visit NAA and NMHC’s
websites at www.naahq.org/governmentaffairs and www.nmhc.org.
Before we close, we
want to thank all of the NAA affiliates and NAA and NMHC members who used the
August Recess to reach out to Congress. Policymakers need to hear from the
constituents who live, work and conduct business in their districts. That
direct contact with you is fundamental to getting our message out on these
critical issues to the multifamily industry.
We
hope that you find this information valuable and welcome your suggestions on
other topics for future communiqués. If you have
questions or comments, please contact Kathleen Gamble at 703-797-0633 or
Kathleen@naahq.org.
Gregory S. Brown
Vice President of Government Affairs
Apartment Association
Cindy Chetti
Senior Vice President of Government Affairs National
National Multi Housing Council
AIMS is the apartment industry's grassroots network operating under NAA and NMHC's Joint Legislative Program. AIMS represents more than 58,000 multifamily housing advocates.
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