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BUILDERS www.elpasobuilders.com

ASSOCIATION

EL PASO

OF

Builders Outlook
Issue 2 2012 Building El Pasos tomorrow today
TM

Obama addresses housing in State of the Union Address

uring his State of the Union address to the nation on Jan. 24, President Obama focused part of his speech on housing issues, offering a proposal to help families stay in their homes and stem the tide of foreclosures.

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PRSRT STD U.S. POSTAGE PAID EL PASO TX PERMIT NO. 429

President Obamas refinancing plan offers an opportunity for continued exploration of ways to aid struggling home owners and tackle the foreclosure crisis, said NAHB Chairman Bob Nielsen. We look forward to working with the White House and Congress to tackle this issue and continue to make progress on foreclosures that are hampering the housing market, he said. Nielsen also reminded the media and public office seekers of the critical importance that Americans continue to place on the dream of homeownership, and called on policymakers to reopen the lines of credit for builders and buyers alike in order to create jobs and further stabilize housing and the economy. In this election year, voters will be looking closely at President Obama, the GOP presidential contenders and congressional candidates from both political parties to determine how they plan to put housing and the economy back on track, said Nielsen. How the candidates respond will decide not only their political fate but the economic prospects of most Americans, he said. Coverage of the Presidents speech by The Hill included a story on his proposal to help ease foreclosures and discussed NAHBs positions on housing extensively.

The group's main priority is on the lending front home builders are urging Congress and federal regulators to figure out a way to get credit moving again for builders so they can start projects in markets where new housing stock is needed, and for home owners, the article said. In an article focusing on the Presidents refinancing proposals in his State of the Union address and how the industry is looking for the White House to do more for housing, the Philadelphia Inquirer cited NAHB Chairman Bob Nielsen. National Association of Home Builders Chairman Bob Nielsen applauded Obamas statement that there has never been a better time to build, but he added that wouldnt be possible without easing credit for the groups members and buyers, the story said. A Response From the Home Builders Institute John Courson, president and CEO of the Home Builders Institute (HBI), also commented on the State of the Union r e m a r k s , commending the Presidents call to support a national commitment to train 2 million Americans with skills that will lead

directly to jobs. Investing in job skills training to boost employment and spur economic growth is critical for meeting the demand for a qualified workforce in the residential construction sector, said Courson. Skills training and job placement are key pillars of the HBI mission, he added. Courson noted that a need for skilled workers is beginning to re-emerge with the slow return of the housing industry from the economic downturn. He cited NAHB projections that housing starts would increase by 17% this year. Courson also cited a report from the ManpowerGroup that 52% of employers are having difficulty filling job openings, and that the top category of hard-to-fill jobs is skilled trades. Courson said that HBI agreed with the Presidents assessment that many companies that want to hire cannot find workers with the right skills. HBI, he added, has the workforce development programs in place so that we can, as the President noted, turn our unemployment systems into a reemployment system that puts people to work. The residential construction sector is poised and ready to help our nation build a strong economy. We look forward to working with the President, Congress and others to ensure

2 ISSUE22012

Builders Outlook

3
Presidents Message
from Alon Brands for sponsoring the meeting. This will be a good time for us to talk, report and follow up on the action from the last few months and look at whats coming up. Your attendance at these meetings is a crucial part of your membership and you should come and break bread with us. We continue the month with our Valentines Day Bowling Tournament where everyone wins and the fun starts. Bowl El Paso on the eastside will host about 40 or 50 of us for a fun filled afternoon. Well give you a full report on that event later on in March. I would like to thank the members who participated in the Spring Home Show at the Civic Center last month. The crowds were big especially on Saturday when Ahmed Hassan from HGTV was there. What a nice guy to stick around and meet and greet so many people. Ray told me he was signing away for over 4 hours. Thanks to our promoters RJ Promotions for a great job. Our goal is to double or triple the number of members showcasing at next years show. Stay tuned. We also will be meeting with our City leaders again in February, looking for ways to help each other reach our goals of making El Paso a great place to live and grow. Sometimes we get locked into some disagreements but overall our job is to be partners with them. Finally, keep in mind that our association is only as good as you make it. Get involved with us, provide us your thoughts, prayers, and support in any way you can. It is my goal to continue the path towards our mission and I can only do this

Builders Outlook

Frank Arroyos
President, El Paso Association of Builders

The month of February is upon us and we move into the new month with hope and prayers. The local economy has continued to show signs of life and some of that is coming to our industry. We still are a long way from where we were only three years ago, but compared to the rest of the country we continue to buck the trends. I think it has a lot to do with the strength that we have from living in the desert, a rough unforgiving land that we call home. So many times weve considered ourselves less fortunate than the rest of the world, but what weve come to know is that we have a resilience few others dare. Im proud to be an El Pasoan and proud to lead this fine federation. We arent perfect but we are here fighting the good fight. Our successes have been in direct proportion to our members and weve got the best in the business. This month is the month for some great opportunities for us as we celebrate and come together for some good things. First is our bi-monthly general meeting held on February 8 at the El Paso Club. The food and atmosphere really is good for us and this month Id like to thank Sonja Scanlon

4 ISSUE 2 2012
Perspective
Ray Adauto, Executive Vice President EPAB

Builders Outlook

Our associations diversity can help shape our future

aware that in our ranks are some of the areas best legal minds, professionals who understand the value and principles that drive the home building industry in El Paso. As the industry continues to grow it gets more complicated and thats when our attorneys become invaluable. They help our members with property rights, consumer law, business law and the other complicated laws that our contractors and developers come across. Would it surprise anyone then that our members include vendors and suppliers? Of course not, but how about other associations as members? Why would business or trade associations join? Strength in numbers and common risks, thats why. How about financial services or insurance professionals? They too understand the importance of a strong home building industry in El Paso. Car dealers? You bet, as they not only supply the work vehicles but also those family cars and trucks that our members buy. Its the same thing when we have any business type in El Paso as a member. Its the

Over the next month or so we will hear more about a change in the Plan for El Paso, a multifaceted document that is known as the Comprehensive Plan. The consultants have worked with the city officials to present a 700 page document on what direction the city should take when deciding growth, land use, health, welfare, and other such things.
common thread associated with membership: value, service and return on investment. Over the next month or so we will hear more about a change in the Plan for El Paso, a multifaceted document that is known as the Comprehensive Plan. The consultants have worked with the city officials to present a 700 page document on what direction the city should take when deciding growth, land use, health, welfare, and other such things. It is a guide that has been shown to a lot of El Pasoans and others as the document to give insight into what the future El Paso should look like. While there are parts of the Plan that our membership doesnt totally agree with there are some proposals that are interesting, thought provoking, and doable. Other parts are wishes. We hope that through the next process of moving the Plan forward that we can work on the sections that concern developing and building in a cooperative way. The risks are great enough without adding rules that add to that risk. What we are asking is that everyone, citizen, politician, bureaucrat, builder and associate alike understand that economics is the driving force for growth in a community. Lose sight of that and nothing is accomplished by a plan, no matter how big.

We represent a fair amount of the home building industry through membership and we impact those who are not members as well. In a review of who our builder/developer/remodeler members are we can comfortably assert that we have the top eight out of ten of the areas most prolific home builders. The same hold true for the developers and we represent the most elite in remodelers. This shouldnt come as news to most. Our membership continues to bring inquiries and we add new members every month. Its the associates who make up the largest segment of a builder association and its true here as well. Many people are not

Guest Perspective

Standardized tests at issue in elections

Since I took office in 2003, I cannot recall a moment when there was any solid consensus for TAAS, TAKS or now for State of Texas Assessment of academic Readiness (STAAR). I believe that a big part of the problem is that parents were never clear on what the content or intent of the testing was for. STAAR attempts to change that by making the test an end of course exam. At least with this measure, there might be some better understanding for parents who want to help their children do well on the exam. However, at this point with the exams looming on the very near horizon, even local school officials are vague on what the tests will be like. What is known is that the end of course exams will count fifteen per cent toward a students grade point average (GPA). There are indications that parents may not know the full GPA until weeks or even months after the end of the school year. Once again, there is in place the academic standards, as measured by the end of course exams, that will not provide the parents a clear picture of their students performance. A reasonable person would probably scratch his or her head in amazement as to how disconnected the process is. It is easy to understand why there is such disconnect; since 2003, educators in the legislature have been locked out of the room when education bills were drafted. Committee leaders with no educational background were guided by lobbyists with different priorities than parents or teachers. Another part to this problem is the application of the legislation by the bureaucrats. They read the bill and write the rules in the manner by which they interpret the law. I have seen where the interpretation is nowhere close to the legislative intent. This problem exists because legislators, who historically supported better legislation, have been voted out of office; or, the majority in the house and senate support the lobby driven educational programs. There is a solution: VOTING. Educators have changed the legislature more than once. Governor Mark White was voted out of office because he imposed on teachers things they did not want. Representative Greusendorf was voted out of office because of legislation he filed and, in some cases, passed that was worse than anything else filed. In 2012 and 2014, educators must make the difference. During the last session, my office received dozens of calls, letters and emails from educators demanding action against certain bills that were harmful to teachers. We researched the voting records of those who contacted the office and found that only around 40% voted in 2010; 25% of those households had no registered voters; and, that many of those households had multiple registered voters but only one actual vote in the 2010 general election. That level of participation will change nothing. I am asking that every teacher and their families vote; especially in the year we elect the governor because those statewide races impact local education more than the presidential year elections.

Chente Quintanilla State Representative

This school year has passed by very quickly and it is now past the halfway mark to completion. That means students will soon be experiencing the annual standardized testing. During the past two or three legislative sessions, TAKS testing has been under fire from educators. According to the critics, education had morphed into the process of teaching the test; something I agreed with. Since the federal mandate by the No Child Left Behind program was passed during the first Bush administration, Texas school districts have battled with the right direction to take when addressing educational accountability.

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915 533 6045 fax 533 6096

Thomas R. Brown, Owner

Builders Outlook

Issue 2 2012

Improving Housing Markets

List of areas now expanded to nearly 100
The list of housing markets showing measurable improvement expanded by 29 metros in February to include a total of 98 entries on the National Association of Home Builders/First American Improving Markets Index (IMI), released today. Thirty-six states are now represented by at least one market on the list.
The index identifies metropolitan areas that have shown improvement from their respective troughs in housing permits, employment and house prices for at least six consecutive months. The February index adds some metropolitan areas that have been particularly weak; this is due to the fact that the IMI measures improvement from a bottom, and some of the hardest hit markets are showing signs of coming off of extreme lows. Keeping this in mind, notable new entrants to list in February include Miami, Fla; Boston; Detroit; Kansas City, Mo.; Portland, Ore.; Memphis, Tenn.; and Salt Lake City. The number of improving housing markets has risen for six consecutive months, and 36 states now have at least one metropolitan area on the list, noted NAHB Chairman Bob Nielsen, a home builder from Reno, Nev. This indicates that despite the many challenges that continue to drag on a housing recovery including the tight lending environment for builders and buyers improving conditions are slowly but surely spreading from one housing market to the next. While many of the markets on the February IMI are far from fully recovered, the index points out where employment, home prices and housing production are no longer retreating and have held above their lowest recession troughs for six months or more, said NAHB Chief Economist David Crowe. This is a sign that a large cross section of the country is starting to turn the corner as local economic conditions stabilize. The fact that there are nearly 100 markets now on the improving list shows that the momentum is building for a housing recovery and that more

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While many of the markets on the February IMI are far from fully recovered, the index points out where employment, home prices and housing production are no longer retreating and have held above their lowest recession troughs for six months or more, said NAHB Chief Economist David Crowe.

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buyers and sellers are starting to feel confident enough to return to the market, said Kurt Pfotenhauer, vice chairman of First American Title Insurance Company. The IMI is designed to track housing markets throughout the country that are showing signs of improving economic health. The index measures three sets of independent monthly data to get a mark on the top improving Metropolitan Statistical Areas. The three indicators that are analyzed are employment growth from the Bureau of Labor Statistics, house price appreciation from Freddie Mac, and single-family housing permit growth from the U.S. Census Bureau. NAHB uses the latest available data from these sources to generate a list of improving markets. A metropolitan area must see improvement in all three areas for at least six months following their respective troughs before being included on the improving markets list. Seven markets dropped from the NAHB/First American Improving Markets Index in February as they experienced softening house prices. These metros include San Jose, Calif.; Washington, D.C.; Kankakee, Ill.; New Orleans; Worcester, Mass.; Jackson, Miss.; and Sherman, Texas. A complete list of all 98 metropolitan areas currently on the IMI, and a separate breakout of metros newly added to the list in February, is available at: www.nahb.org/imi.

6 ISSUE22012

Builders Outlook

Affordability Reaches Record Level

TightCreditConditionsImpedeHousingMarket
El Paso continues to fall into bottom 10 least affordable
From NAHB Nationwide housing affordability, as measured by the National Association of Home Builders/Wells Fargo Housing Opportunity Index (HOI), rose to a record level during the fourth quarter of 2011, while prospective home buyers continued to feel the constraints of tighter credit standards and a soft economy. HOI data released today indicated that 75.9 percent of all new and existing homes sold in the fourth quarter were affordable to families earning the national median income of $64,200, the highest percentage recorded in the 20year history of the index. While todays report indicates that homeownership is within reach of more households than it has been for more than two decades, overly restrictive lending conditions confronting home buyers and builders remain significant obstacles to many potential homes sales, even with interest rates at historically low levels, said Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla. In Youngstown-Warren-Boardman, Ohio, Pa., the most affordable major housing market in the country during the fourth quarter, 95.1 percent of all homes sold during the quarter were affordable to households earning the areas median family income of $54,900. Also ranking at the top of the most affordable major housing markets, in descending order were Lakeland-Winter Haven, Fla.; Modesto, Calif.; Harrisburg-Carlisle, Pa.; and Toledo, Ohio. Among smaller housing markets, the most affordable was Kokomo, Ind., where 99.2 percent of homes sold during the fourth quarter of 2011 were affordable to families earning the median income of $59,100. Other smaller housing markets at the top of the index included Fairbanks, Alaska; Cumberland, Md.-W.Va.; Lima, Ohio; and Rockford, Ill. In New York-White Plain-Wayne, N.Y.-N.J., the least affordable major housing market during 2011s fourth quarter, 29.0 percent of all homes sold were affordable to those earning the areas median income of $67,400. This was the 15th consecutive quarter in which the New York metropolitan division held this position. Other major metro area at the bottom of the affordability index included Honolulu; San Francisco-San MateoRedwood City, Calif.; Santa AnaAnaheim-Irvine, Calif.; and Los Angeles-Long Beach-Glendale, Calif., respectively. (Editors note: El Paso, Texas ranked 8th in least affordable category for populations of 500,000 or more. El Pasos median income is around $37,000 a year for a family of four.) Ocean City, N.J., where 47.5 percent of the homes were affordable to families earning the median income of $70,100, was the least affordable of the smaller metro housing markets in the country during the fourth quarter. Other small metro areas ranking near the bottom included Laredo, Texas; San Luis Obispo-Paso Robles, Calif.; Santa CruzWatsonville, Calif.; and BrownsvilleHarlingen, Texas. The NAHB/Wells Fargo HOI is a measure of the percentage of homes sold in a given area that are affordable to

ElPasoranked8thinleast affordablecategoryfor populationsof500,000or more.ElPasosmedian incomeisaround$37,000a yearforafamilyoffour.)

families earning that areas median income during a specific quarter. Prices of new and existing homes sold are collected from actual court records by First American Real Estate Solutions, a marketing company. Mortgage financing conditions incorporate interest rates on fixed- and adjustable-rate loans reported by the Federal Housing Finance Board. The NAHB/Wells Fargo Housing Opportunity Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public.

Builders Outlook

ISSUE 2 2012

Guest ADVICE

Health Care Reform: Whats happening in 2012?

glossary of health insurance coverage terms. If you have a fully insured plan, your insurer will provide these documents. The summary will contain simple and consistent information about health plan benefits and coverage. It will allow individuals to easily compare different coverage options by summarizing key features, such as covered benefits, cost-sharing provisions, coverage limitations and exceptions. People will receive the summary when shopping for coverage, enrolling in coverage, at each new plan year, and within seven days of requesting a copy from their health insurance issuer or group health plan. A new fee. For policy or plan years ending after Sept. 30, 2012, issuers and employers sponsoring certain group health plans must pay a fee of $1 per member per year. The fee jumps to $2 per member per year for policy or plan years ending after Sept. 30, 2013, and then is subject to adjustment. Fees will go to the Patient-Centered Outcomes Research Institute (PCORI) to fund research that will help inform health care decisions. PCORI, an independent nonprofit organization established by Congress through the Affordable Care Act, will seek to provide evidence on the effectiveness of different treatment options for different patients. Studies will compare drugs, medical devices, tests, surgeries and ways to deliver healthcare. A new way of keeping medical records. The first regulation implementing electronic health records will go into effect on October 1. Healthcare remains one of the few industries that rely on paper records. The Affordable Care Act institutes a series of changes to standardize medical billing and requires health plans to begin adopting and implementing rules for the secure, confidential, electronic exchange of health information. Using electronic health records will reduce paperwork and administrative burdens, cut costs, reduce medical errors and, most importantly, improve the quality of care. New reporting requirements. Employers that issue 250 or more W-2 forms should be preparing to report their contributions toward employees health insurance premiums on W-2s for tax year 2012 (which go out in early 2013). All other employers must comply by tax year 2014. Although employees who terminate their employment before the end of 2012 may request an early W-2, employers are not required to report health coverage costs on those early W-2 forms. The IRS has clarified that the reporting is informational only, to inform employees of the cost of their health care coverage, and does not cause excludable employerprovided health care coverage to become taxable. The IRS further clarified that applicable employer-sponsored coverage does not include dental or vision coverage, unless they are included in a major medical plan. It also does not include long-term care or disability coverage. Finally, the law does not require employers to send a Form W-2 with healthcare reporting information to retirees or other former employees who receive no compensation from the employer. To calculate the premium amount, use the monthly premium rate for a fully insured plan or the COBRA premium equivalent rate minus the 2 percent administrative fee for a self-insured health plan. Include both employer and employee contributions; employer contributions to medical savings accounts (MSAs), health savings accounts (HSAs), health reimbursement arrangements and most flexible spending accounts (FSAs) are excluded. Joe Bernal is a licensed insurance and financial services professional and member of the El Paso Association of Builders. He may be contacted at: joeb@joebernalinsurance.com

Joe Bernal Employee Benefits of El Paso

The centerpiece of the Patient Protection and Affordable Care Act, health insurance exchanges, wont go into effect until 2014. However, some portions of the law will begin taking effect this year. Heres an overview of some of the changes youll see. A new health plan model. Starting on January 1, accountable care organizations (ACOs) can enter into contracts with Medicare. The Affordable Care Act provides incentives for physicians and hospitals to join together in ACOs, integrated healthcare systems that coordinate patient care to improve quality, prevent disease and illness and reduce unnecessary hospital admissions. ACOs that furnish high-quality services will be rewarded based on standards that they help develop, based on solid medical evidence. Many insurers and employers will be watching to see if ACOs can deliver quality healthcare at a savings to Medicare patients. If they can, look for employer groups to move to ACO models. Starting on March 23, health insurers and group health plans must provide two documents designed to help plan members understand their benefits: a standardized summary of benefits and coverage and a uniform

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EPAB

ONTHESCENE
Spring Home Show features Yard Crashers
The 2012 Spring Home Show presented by the El Paso Association of Builders was a great way to start 2012. Our partner producer, R J Promotions of St. Joseph, Missouri gave El Paso what it wanted in a show: great exhibitors and a very hot TV star. While the booths were doing some bang up business during the first few hours of the show nothing compared to the throngs of visitors that showed up on Saturday to see HGTV and DIY star Ahmed Hassan of Yard Crashers fame. Hassan met the large crowd with smiles and hugs as the handsome and talented young star didnt hesitate to press the flesh. In all the years that Ive done shows with talent this has got to be one of the best experiences for the audience, RJ Promotions floor agent Reagan Bartram said. No doubt the ladies liked Ahmed but it was the guys who came to see him that surprised even the most experienced show staff. It was amazing to see that the guys enjoyed visiting with Ahmed nearly as much as the ladies, but they also had some technical questions that Ahmed was able to answer for the most part, said Ray Adauto. It was posted that Hassan would appear for a couple of hours but instead he worked the crowd for nearly five hours. Im tired, but Im so happy to be with my fans. This is what I love about being on the show and its what I live for, Ahmed said. EPAB member 84Lumber took full advantage of Hassan as he was the main attraction at a nailing contest. Throngs of fans gathered around the exhibit in order to see the contest and watch. Texas Gas also had a great outing as John Reich told the Outlook of their success. I have to tell you, this was a great show and we had a lot of fun doing it, Reich said. Our display was next to Lowes and the crowds were overwhelming, he continued. The Spring Home Show produced by R J Promotions is the only home show exhibit that the El Paso Association of Builders endorses. This is the third year for the partnership. The 2013 Spring Home Show is already being mapped and were sure R J will bring in another top notch entertainer. Were also hopeful that Ahmed will bring his TV show to El Paso and makeover a local yard.

Issue22012
Asssociates Meeting
The Associates Council met at the EPAB offices in January. The meeting was held to go over the upcoming events and to report on the Spring Home Show. A good crowd showed up to get reports from Sam Shallenberger, Associates Council Chair, and also from Ray Adauto. Sam reported that our Spring Home Show had been well attended especially with the HGTV Yard Crasher star Ahmed Hassan. Attendees also got an opportunity to visit with a variety of show exhibitors ranging from home builders to water treatment vendors. Also on the agenda was upcoming February 14 bowling outing to be held at Bowl El Paso. Sam talked about the variety of prizes and the fun aspect of the event. The associates were also told to expect a few educational sessions and some new events including an all new format on the upcoming Spring Golf Tournament. A show of hands also gave the association permission to pursue a concealed handgun class for members and nonmembers alike. More information will be forthcoming on this class later during the month. Associates attending also had a chance for some great gift drawings including a portable grill station won by Nailea Fernandez; a free general meeting lunch won by Art Salazar; and a windbreaker won by a guest. All in all a fun time for our Associates Council.

Everyone needs a cornerman

By Ray Adauto
Some of you may know who Angelo Dundee was and some of you wont. I doubt seriously if anyone alive today doesnt recognize the name Mohammed Ali (Cassius Clay); or perhaps Sugar Ray Leonard, or Joe Frazier. If you remember these names perhaps you should remember Angelo Dundee, because frankly you couldnt have any of those other names in your collective memory without Angelo. It was Angelo Dundee, soft spoken Italian man who turned Ali, Frazier, Sugar Ray and others into the boxing worlds most prolific boxers. In boxing circles he was one of the best, if not the best, cornermen. Angelo Dundee was there with other notables in the professional boxing world. He was the cornerman for George Foreman when he took on Evander Holyfield. In addition, Dundee also trained such world champions as Luis Rodriguez, Willie Pastrano, Ralph Dupas, Jos Npoles, Pinklon Thomas, Trevor Berbick, Jimmy Ellis, Wilfredo Gmez, Michael Nunn and Sugar Ramos, as well as other boxers such as Bill Bossio, David Estrada, Douglas Valliant, Jimmy Lange, Tom Zbikowski and Pat O'Connor. I got to meet Angelo Dundee while attending an national Executive Officers meeting in Providence, Rhode Island. He was about 87 then and in remarkable health, keen, and so gracious to a guy from El Paso, Texas. Angelo Dundee was a mans man. A gentle, kind, man. He was a cornerman, a trainer. The point of this story isnt that I got to meet Angelo or that he turned out to be the gentleman that I always thought of him as. No its got a lesson that sends a message about success as much as anything else. The message? We cant be champions alone. No matter what you think of yourself, even if you reign as the world champion of something, be it football, baseball, boxing or career, you didnt get there without a cornerman. You need someone that can acknowledge your weaknesses and sharpen your strengths. As an association member you need to know that others may have gone through what youre experiencing and they are more than willing to help give you advice or training. Acknowledging that you need others is the first step to success and a way to maintain it. If you plan to diet find someone to help. If you need help with taxes, find someone to help. If you are struggling in business find a business trainer to help you. Ali, Frazier, and Leonard ad great as they were all knew they needed Angelo Dundee. When you take the time to look for a cornerman you find yourself on the path to success. Find your own Angelo Dundee and train to your success.

10 ISSUE 2 2012
GAO Study Finds Appraisal Process Inadequately Monitored
Zeroing in on yet another deficiency of a faulty appraisal process that is hurting home values, hampering a housing recovery and often killing sales of homes coming in below the contract sales price, the Government Accountability Office (GAO) earlier this month reported that the Appraisal Subcommittee, which oversees the appraiser regulatory programs established by the states, needs to improve its monitoring procedures. These findings underscore the need to establish an effective oversight system to ensure that appraisals accurately reflect true market values and dont harm aspiring home buyers or builders, said NAHB Chairman Bob Nielsen, a home builder from Reno, Nev. A recent NAHB survey shows that one out three builders have lost signed sales contracts because of flawed appraisals and a fall survey conducted by the National Association of Realtors shows that 18 percent of Realtors reported a recent contract cancellation or delay as a result of a low appraisal. Numerous flaws in the appraisal system have been causing inaccurate home valuations, both in times of housing weakness and strength. NAHB has been actively seeking improvements in appraiser education and training, particularly for appraisals of new homes, as well as more rigorous oversight so appraisal guidelines are enforced and errors can be corrected as they occur. The GAO report found the Appraisal Subcommittees enforcement tools and procedures for reporting compliance levels have been limited. The GAO cited several weaknesses that have potentially limited the subcommittees ability to monitor state appraiser regulatory agencies, the federal financial institution regulators and the Appraisal Foundation, a private, non-profit corporation that sets criteria for appraisals and appraisers. Under the Dodd-Frank Act, the Appraisal Subcommittee was granted the authority to establish a national hotline to receive complaints over noncompliance with appraisal independence standards and grievances from appraisers, individuals or other entities over attempts to improperly influence appraisers or the appraisal process. Currently, no such hotline exists and the GAO report states that the creation of a national hotline could strain the Appraisal Subcommittees resources. Observing that the critical role of real estate appraisals in mortgage underwriting underscores the importance of effective regulation of the appraisal industry, the GAO study calls on the Appraisal Subcommittee to strengthen its oversight by developing specific policies and procedures for monitoring the appraisal requirements of the federal financial institutions regulators. How homes are valued can have a dramatic effect on home owners mortgages, foreclosure rates, the health of banks and, ultimately, the condition of the U.S. financial system, said Nielsen. The current system is not working, he said. We must resolve a flawed appraisal process that produces inaccurate assessment of home values, because this fosters price instability, puts more families in danger of default or foreclosure, and undermines the housing and economic recovery. Its time that regulators, appraisers, lenders and all of the stakeholders in this debate come together and agree on major reforms in appraisal practices and oversight to ensure that homes are appraised at their fair market rate.

Builders Outlook

Builders Outlook

issue 2 2012

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12issue 2 2012

Builders Outlook

A look back...
Moments in our 65 year history

he year was 1995. Population of El Paso County in 1995: 661,864. The world was tuned into the O.J. Simpson criminal trial that started in January. In February of that year the Dow Jones Industrial Average closed above 4000 for the first time ever. The United Kingdom's oldest investment banking firm, Barings Bank, collapses after securities broker Nick Leeson loses $1.4 billion by speculating on the Tokyo Stock Exchange. In Denver, Colorado, Stapleton Airport closes and is replaced by the new Denver International Airport, the largest in the United States. Sadly, in March of 1995 Tejano superstar Selena is killed by the president of her own fanclub, Yolanda Saldvar. April brought us the bombing of the Oklahoma City Federal building. Homegrown terrorism was real and its ugly head had risen with devastating results. On a much lighter note the Rock and Roll Hall of Fame opened later that year, and Pope John Paul II visited the U.S. in late October. At the movies it was the movie Babe, about a little pig with a big heart, or Dead Man Walking with Tom Hanks taking the most money in that year. Back here at home the El Paso Association of Builders is led by President Rudy Guel. The VP was Pat Woods, Treasurer John Cullers, Secretary is Bobby Bowling IV, Associates chair Bill Royer, and the E.O. was John Gross. The councils numbered five with Wayne Grinnell leading Land Use. Womens Council was headed up by Dorothy Swack. February 1995 meant a trip to Austin for Legislative Rally Day, and time was getting close for the upcoming Home Show. Concerning the trip to Austin, John Gross told the members that a round trip flight to Austin on Southwest Airlines would be $124! Looking at some of the issues for 1995 its interesting to note that there was a battle going on with the Public Service Board over a proposal to charge $1,146.00 per water meter for each new home or single water hookup. The association was fighting that proposal with action from the Government affairs committee headed up by Bobby Bowling IV. Wayne Grinnell was heading up a committee working on a proposed landscape ordinance. Tony Conde and John Ivey, Jr. were helping with the politics of that proposal. There was also a move afoot to get members into the PAC especially with the upcoming city elections. Wayne would state the political war chest should be large and noisy. El Paso was going to experience one of the most devastating economic events. In 1995, the Department of Defense recommended that the U.S. 3d Armored Cavalry Regiment be relocated to Fort Carson, Colorado. Efforts to consolidate units from another post with those units that remained at Fort Bliss were overruled by the Base Realignment and Closing Commission, leaving Fort Bliss without any armored vehicles. Our Builders Outlook newsletter was printed on color paper and was 16 pages. Featured ads included those from Sun World Savings Bank, Bluebonnet Savings Bank, FSB; Alpha Distributing; Stewart Title; BMC West; Sarabias Portable Jons, Inc.; Lawyers Title; Pioneer Mortgage Co.; and Mobile Comm just to name a few. Some are still around, others not. 1995 was no different than 2012 in that an announcement was placed asking for reservations for events and meetings were important. RSVP is still not in some peoples vocabulary. The more things change, the more they are the same. Compiled to By Ray Adauto
Information for this column came from a variety of sources including Wikipedia, US Census Data, and various news organizations.

A Look Back is a monthly feature of the El Paso Association of Builders publication the Builders Outlook. Look for more history of the El Paso Association of Builders in coming editions.

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Membership news
UPCoMInG EVEnTS
FEBRUARY 14 VALENTINES DAY BOWLING EVENT BOWL EL PASO 12:30 TO 4:00 P.M. FEBRUARY 22 TAB WINTER MEETINGS AUSTIN, TEXAS LANDUSEMEETING EPABNOON MARCH 7 ASSOCIATESCOUNCIL 3:30 PM EPAB OFFICE MARCH 14 BOARD MEETING 12:00 NOON EPABOFFICE APRIL 10 SPRING GOLF TOURNAMENT PAINTED DUNES APRIL 11 11:00 BOARD MEETING 12:00 GENERAL MEETING ELPASO CLUB

REnEWALS
ADAMS MOLDING AND LUMBER AVX WHOLESALE BIC HOMES CONDE, INC. DAVIDSON CUSTOM HOMES EL PASO DOOR EL PASO ELECTRIC GENERAL ELECTRIC JOBE MATERIALS PREWIRE OF EL PASO SHERWIN WILLIAMS SIERRA TITLE SOUTHWEST CHIMNEY, STOVES AND AIR DUCT CLEANING

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14 ISSUE 2 2012

Builders Outlook

Industry Reports
AssociatesCouncil
year with a really good Spring Home Show at the Convention Center. While traffic was real good over the three days nothing compared to the crowds on Saturday as the HGTV star Ahmed Hassan really drew well. The displays were nice but most importantly for many of us was that we got a good opportunity to let the consumer know who we are first as a business and then as a member. I have a real big wish for the Spring Home Show in 2013 and that is that more members see the value of participating in the show. I guarantee you that you can live off the referrals if you work them right! Nothing says success like it. Our next outing is the much anticipated Valentines Day Bowling event. Should be a lot of fun with the theme of the day and the fun time we have bowling. You know its also neat when we get to give out some cool prizes. Ray has provided a $50 dining card and it looks like Western Wholesale is going to be able to offer a wonderful high end mixer again. As of the deadline we still had a few lanes available so come out and enjoy a fun afternoon. What a great place to bring a customer! The chili-menudo cook-off is still in the works as is a tour of homes and some other events later on this year. We will be offering a few education classes soon as well as a really cool concealed hand gun class sometime soon. Stay tuned as your Associates Council moves forward. Good luck and good selling. See you at our next meeting.

SamShallenberger
WesternWholesale Supply

Associates Council met in January to discuss plans for 2012, introduce some new associates and bring the group up to date. It was a great time and I want to thank all of the members who came. We started the

LandUseCouncil
postponed until March in order to allow for time for stakeholders to provide their comments. The latest draft plan and list of proposed updates are available for review online at www.planelpaso.org For those of you who are unfamiliar with the plan, it is the document that provides guidance to Council and staff regarding the project and development goals of the city. It does not change existing regulations. In order for regulatory changes to be affected, individual ordinances must be adopted. This plan does, however, impact the opportunities for future land use changes. For example, if a land owner wishes to rezone a property, then the planning department will cross check the proposed use against the land use map of the comprehensive plan and make recommendations to the planning commission based upon whether or not the requested zoning is consistent with the comprehensive plan. Similarly, thoroughfares will also be checked against the major thoroughfare plan map that is a part of the comprehensive plan. For this reason, it is vital that comments from all stakeholders be sent to the planning department. The link to email the City staff regarding the comprehensive plan process is available on the Click here to Email Us! link on www.planelpaso.org. In addition, Sal Masoud is a board member of the Rio Grande Citizens Forum and is actively involved in the processes and status of the proposed Federal Emergency Management Agency (FEMA) Flood Insurance Rate Map (FIRM) updates. Information regarding this status may be viewed on the Citys website at www.elpasotexas.gov. It will also continue to be a topic of discussion at our Land Use Council meetings on the fourth Wednesday of each month. We hope to see you there!

LindaTroncoso

It has been a long road, but the City of El Paso currently in the process of finalizing the Comprehensive Plan for El Paso. Through extensive coordination with industry members, the presentation of the plan to CPC and the City Council has been

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I execuTive oFFicerS Frank Arroyos - President Cisco Homes edmundo Dena - vice President Accent Homes Frank Torres - Secretary/Treasurer GMF Custom Homes Sam Shallenberger - Associates council Western Wholesale Supply Greg Bowling - immediate Past President Tropicana Homes ray Adauto - executive vice President El Paso Association of Builders I TABSTATe DirecTorS Doug Borrett, Karam Co., Life Director Randy Bowling, Tropicana Homes I NATioNAL DirecTorS Bobby Bowling IV. Demetrio Jimenez

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ePAB mission Statement: The El Paso Association of Builders is a federated professional organization representing the home building industry, committed to enhancing the quality of life in our community by providing affordable homes of excellence and value. The El Paso Association of Builders is a 501C(6) trade organization. 2012 Builders Outlook is published and distributed for the El Paso Association of Builders by Snappy Publishing 240 Thunderbird Suite C El Paso Texas 79912 915-820-2800

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