Builders Outlook 2015 Issue 12
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Transcript of Builders Outlook 2015 Issue 12
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 116
President Obama has signed into law a $622 billion tax package
that permanently renews certain NAHB housing tax priorities
while providing a two-year retroactive renewal for others through
the end of tax year 2016
Congress regularly acts annually to extend scores of temporary
tax provisions known as tax extenders that are often renewed foronly one or two years at a time This legislation would make many
temporary provisions permanent
The tax extenders package includes these key housing
provisions
Builders
Outlook
Major Victorybull Low Income Housing Tax Credit The
bill permanently sets the credit rate at9 for housing credits used forfinancing new construction andsubstantial rehabilitation When creditrates decline less equity is availablefor developments so keeping a
permanent minimum 9 floor onfederal housing credits is a significantvictory for affordable housing This willprovide all developers with much-needed certainty when planning futureprojects NAHB has been working foryears to make the 9 minimum creditrate floor permanent
Big Winsbull Section 179 Expensing The tax
package permanently extends thesmall business expensing limitationand phase-out amounts for Section179 Current law allows smallbusiness to immediately write off$25000 of qualifying property whichis phased out for total investmentsabove $200000 The bill increases
this limit to $500000 for qualifiedproperty with a $2 million phase-outand indexes both for inflation
bull Residential Energy Efficiency TaxCredit (25D) Extends through 2021Section 25D which provides tax
incentives for installing clean energytechnologies such as solar orgeothermal 25D provides a 30 taxcredit to consumers for installingqualified power production propertyThe credit is also uncapped so allqualifying expenses may be claimedThe bill will extend but phase out the
credit for solar starting in 2020 whenthe credit will fall to 26 dropping to22 in 2021 before expiring in 2022
Winsbull Credit for Energy-Efficient New
Homes (45L) This provides buildersa $2000 tax credit for exceedingenergy standards by 50 The baseenergy code is the 2006 InternationalEnergy Conservation Code plussupplements The 45L tax credit isextended through 2016 and can beclaimed by both for-sale and for-renthomes of three stories or lessproviding the developer has a taxbasis in the property at the time ofdevelopment Section 45L is expectedto save home builders $361 million for
tax year 2015
bull Credit for Non-business EnergyProperty (25C) This provisionextends through 2016 the 25C taxcredit which provides a credit up to
$500 for consumers installing qualifiedenergy-efficient upgrades Theprovision updates the baseline forqualifying components Section 25C isexpected to save home owners whoremodel $826 million for tax year2015
bull Bonus Depreciation Originallyintended as a short-term stimulusitem the bill extends but phases outthe bonus depreciation for propertyacquired and placed in service during2015 through 2019 The bonusdepreciation percentage is 50 forproperty placed in service in 20152016 and 2017 dropping to 40 in2018 and 30 in 2019 Bonusdepreciation applies to qualifiedproperty with a recovery period of 20years or less
bull Mortgage Insurance Premiums Thisprovision allows taxpayers subject toan income cap beginning at $100000to deduct premiums paid for privatemortgage insurance and FHARHAVA
insurance premiums The deduction ofmortgage insurance premiums isextended through 2016 and isexpected to save home owners $13billion for tax year 2015
bull Mortgage Debt Forgiveness Thisprovision would eliminate any taxeshome owners might face whenrenegotiating the terms of a homeloan when banks forgive a portion ofthe outstanding mortgage particularlyin connection with short sales Thisapplies only to principal residences
and through the 2016 calendar yearThe exclusion is also modified to debtdischarged in 2017 if the discharge ispursuant to a written agreemententered into in 2016 This extension isexpected to save home owners $33billion for tax year 2015
bull Deduction for Energy-EfficientCommercial Buildings (179D) Thisprovision extends through 2016 adeduction up to $180 per square footfor commercial buildings includingmultifamily buildings built under thecommercial code that meet thebaseline ASHRAE 2007 standard
NAHB provides this information for general guidance only Thisinformation does not constitute the provision of legal advice tax adviceaccounting services investment advice or professional consulting of anykind nor should it be construed as such The information provided hereinshould not be used as a substitute for consultation with professional taxaccounting legal or other competent advisers Before making any decisionor taking any action on this information you should consult a qualifiedprofessional adviser to whom you have provided all of the facts applicableto your particular situation or question None of this tax information isintended to be used nor can it be used by any taxpayer for the purpose ofavoiding penalties that may be imposed on the taxpayer The information isprovided ldquoas isrdquo with no assurance or guarantee of completenessaccuracy or timeliness of the information and without warranty of any kindexpress or implied including but not limited to warranties of performancemerchantability and fitness for a particular purpose
The installation of officers
and board for 2016 took place
at the Marriott Hotel on Friday
December 11 A festive crowd
of nearly 300 enjoyed the
dinner the drinks and the
presentation of awards before
the business got started
ldquoIrsquom so grateful to the members forcoming out to this installationrdquo saidincoming President Carlos VillalobosldquoThe setting the food the whole thing is
really great I hope I donrsquot mess up mytalkrdquo Villalobos told the Outlook prior tothe installation of officers This year wewere able to say thanks to many whohave supported the association over theyear and to acknowledge those whopassed during the year We remembereda past president Zeke Zar and a great
supporter associate member Jack Whiteboth who did much for the associationand will be missed
The event also honored those who didsome special little extra such as ouradvertisers who helped keep theassociation afloat in some difficult timesThe event was opened by incoming board
member Gregg Davis with a quick butbeautiful invocation He was followed bypatriot John Chaney as he led the groupin the Pledge of Allegiance
Our event couldnrsquot have happenedwithout the support of partners Wersquod liketo thank our Diamond Partners PointeHomes Foxworth Galbraith JOBE HUBInternational Century 21 APD BMCSelect KB Realty YREE MTI Ready Mixand GECU These folks were honoredwith their Diamond Awards
Our next level of partnerships were ourPlatinum Partners HUNT Stewart Title ofEl Paso and Pioneer Bank And finallyour Gold Partners Rocky MountainMortgage 2-10 Home Buyers Warrantyand Interceramic Tile and Stone GalleryOur sincere thanks to all these partnersfor their support of the installation
The rest of the story amp photos page 8
National State amp Local Building Industry News2015 Issue 12
wwwelpasobuilderscom
Tax Extenders
Package Includes
Key NAHB
Priorities
EPAB Installs
New officers
7212019 Builders Outlook 2015 Issue 12
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2 Builders Outlook 2015 issue 12
HAPPY HOLIDAYS FROM YOUR
FRIENDS AT TEXAS GAS SERVICE
The holidays are a time to give thanks and celebrate with the ones you love
At Texas Gas Service wersquod like to express our gratitude to you for building with
natural gas and for giving your buyers the gift of savings We wish you and your
customers a safe and warm holiday season
Let us help you plan for natural gas right from the start
For more information
ElPasoNewBusinessTXGascom
William Nieves 915-496-6126
Jorge Sejera 915-680-7216
7212019 Builders Outlook 2015 Issue 12
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ldquoEditorrsquos note Edgar Montiel had prepared his farewell address for the installationawards banquet but through some excitement and overview we skipped his farewellHere it is more or less as it was to
be read My sincere apology to Edgar for the snafurdquo
I asked a couple of people what Ishould write for my last article and I amshocked that the answer I received themost was to just say ldquopeace outrdquo Somepeople carried that a little further andsaid that I should also drop themicrophone as I walked off in to thesunset Obviously I had to remindthem that this was a publication thoughI actually gave some thought to how Icould drop the microphone with wordsOne thing is for sure I will keep it short
I am so grateful to all of you for giving
me the opportunity to serve as yourPresident and am looking forward tobecoming part of the strong legacy ofpast presidents My role as Presidenthas allowed me to see firsthand all ofthe relationship fostering activitiesand issues that the association isconstantly managing Ray was notkidding when he said that the positionwould require a lot of time andcommitment I could not have fulfilled
my duties as President without the helpof my family and amazing constructionand sales staff thank you I also couldnot have done this without theguidance and support provided by RayMargaret and Frank Torres thank youI have learned a lot during my term onthe leadership ladder and can honestlysay that I am a better businessmanbecause of it I am super excited withthe positive direction that theassociation is headed with the currentladder and board Carlos Don and
Kathy are intelligent committedpersonable and will all do amazing jobs during their tenure
Being named the EPABrsquos Builder ofthe Year is truly an honor I cannotthank each of our team membersenough for all of their hard worksacrifice and dedication I especiallywant to thank my wife and kids theHarris Real Estate Group ourcustomers subcontractors suppliers
the City of El Paso all of our lendersand land developers Thank you
I thank all of you again for thisamazing opportunity and wisheveryone absolute success in 2016Merry Christmas and Peace Out
32015 issue 12 Builders Outlook
Edgar MontielPresidentEl Paso Associationof Builders
Peace Out
C
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Northea
5500 NestsidW
ra2244 T Eastside
415 N MDownto
new year
ousosperfor a happy holiday and pr
arm wisheswe celebrate you Wcelebrate this holiday season -
No matter how you personally
comel-paso
8200
ow Bean Suite Dodrt
esert Suite A-2
ood Drive Suite 101
eet esa Strn
stewart
-225-519
o4712 W
Presidentrsquos
Message
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 416
Christmas is a time for kids Itrsquos atime for believing Itrsquos a time for
remembering If yoursquore like me bythe time the actual celebration date
comes around yoursquore tired Tired ofthe hustle that has become this holy
day the celebration of the birth ofJesus Christ in fulfillment of
prophecy Today we tend tosomehow forget that this is why we
have Christmas and shamefully wehide this fact by calling it a ldquowinterrdquo
holiday erasing the very meaning ofthe day Instead wersquore bombarded
with store sales movie releasesand all the things worldly rather than
holy For some of us it is time ofremembering those who canrsquot be
with us anymore either throughdeath divorce separation or
deployment Itrsquos the most stressfulholiday I can think of and that my
friends is why I particularly am a
humbug We tend to place so muchvalue to things rather than being
thankful for what we already haveRushing out to get a ldquogiftrdquo for
someone isnrsquot what we should bedoing We should be sharing what
we have to those less fortunate weshould be checking in on our elderly
making sure they have food andheat we should be giving to our
place of worship if we have one weshould be reaffirming our
relationships with each otherFamily as most think of it is the
most important thing we have yet weoften use this holiday to punish
those who we should love the mostI know from experience that this time
should be used to buildrelationships mend some and
prepare for the coming year Mydad died on Christmas day This
calendar date is hard for me
personally as I canrsquot ever think of thedate any other way than this is the
day my dad died Sorry but thatrsquoshow it is for me I love the fact that
we celebrate this date for the birth ofthe Christ Child and Irsquom willing to
celebrate with my family I do sobecause we have to move on Itrsquos
what we have to do in order not tolinger on the bad but to begin to
bring in the better A family isespecially important at this time I
hope you can share it with yoursIrsquom going to end my column with
some hope for 2 016 First andforemost I hope for a healthy
housing economy that helps ourmembers and in turn us I hope that
we grow our membership so that wecan share what we know and what
we do with those who donrsquot have aclue right now I hope that the city of
El Paso finds ways to govern
properly with less in fighting andmore work on roads bridges alleyrsquos
and less impediments like theroundabouts and corner structures
you canrsquot see at night I wish forTexDot to fix the huge pot holes on
the freeway I hope for more jobs tobe created and for the processes
towards that less cumbersome Ihope we get to vote for leading
candidates that give a damn aboutyou and me and the nation I hope
for less ldquopolitical correctnessrdquo andmore sensible action by government
I hope that our armed forces aregiven what is needed to win not just
to show up and I wish bettertreatment for our veterans I wish
for the end of Obamacare that ismaking our businesses less covered
and more broke I wish for betterhealth wealth and faith To you and
yours Merry Christmas
Ray Adauto
ExecutiveVice President
EPAB
4 Builders Outlook 2 15 issue 12
A time for hope
Executiversquos
Message
7212019 Builders Outlook 2015 Issue 12
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GINDILB
El P
soSIN 0951E
5 15 issue 12 Builders Outlook
Single-Family Starts ReachSeven-Year High983150 Nationwide housing starts rose 105
percent to a seasonally adjusted annualrate of 1173 million units in Novemberaccording to newly released data from theUS Department of Housing and UrbanDevelopment and the CommerceDepartment Single-family productionincreased 76 percent to a seasonallyadjusted annual rate of 768000 units itshighest reading since January 2008Multifamily production rose 164 percent to405000 units
ldquoThe November gains in both single- andmultifamily starts show that the overallmarket continues to move forwardrdquo said
NAHB Chairman Tom Woods a homebuilder from Blue Springs Mo ldquoAs buildersanticipate more consumer demand forhousing they should continue to addinventoryrdquo
ldquoSingle-family production this month hasreached levels last seen before the GreatRecession an indicator that we are makinggradual headway back to a normal housingmarketrdquo said NAHB Chief Economist DavidCrowe ldquoAs we close out the year we cansee that the housing sector has madeheadway in 2015 and we expect therecovery to continue at a modest pacerdquo
Combined single- and multifamily startsrose in the South and West with respective
gains of 213 and 63 percent The Midwestwas unchanged and the Northeast fell 85percent
Overall permit issuance rose 11 percentto 1289 million units in NovemberMultifamily permits rose 269 percent to arate of 566000 while single-family permitsincreased 11 percent to 723000 thehighest level since December 2007
Regionally the Midwest South and Westposted respective permit gains of 22percent 56 percent and 217 percentPermit levels in the Northeast held steady
New Home Sales Rise
107 Percent in October983150 Sales of newly built single-family homes
rose 107 percent to a seasonally adjustedannual rate of 495000 units in Octoberaccording to newly released data fromHUD and the US Census Bureau
ldquoOur builders are reporting continuedoptimism in the housing market and areadding inventory in anticipation of futurebusinessrdquo said Tom Woods chairman ofthe National Association of Home Builders(NAHB) and a home builder from BlueSprings Mo
ldquoSales this year are running 157 percentahead of 2014rdquo said NAHB ChiefEconomist David Crowe ldquoWith a firming job market affordable home prices and
rising pent-up demand todayrsquos report isanother indicator that the housing marketcontinues to move on a modest upwardtrajectoryrdquo
New-home sales were up in three out ofthe four regions Sales rose 1353 percentin the Northeast 53 percent in theMidwest and 89 percent in the SouthSales fell 09 percent in the West
The inventory of new homes for sale was226000 units in October This is a 55-month supply at the current sales pace
Builder Confidence EdgesDown One Point983150
Builder confidence in the market fornewly constructed single-family homesremained relatively flat in Decemberdropping one point to 61 on the NationalAssociation of Home BuildersWells FargoHousing Market Index (HMI)
ldquoOverall builders are optimistic about thehousing market although they arereporting concerns with the high price oflots and laborrdquo said NAHB Chairman TomWoods a home builder from Blue SpringsMo
ldquoFor the past seven months builderconfidence levels have averaged in the low60s which is in line with a gradualconsistent recoveryrdquo said NAHB ChiefEconomist David Crowe ldquoWith job creation
economic growth and growing householdformations we anticipate the housingmarket to continue to pick up traction as wehead into 2016rdquo
Derived from a monthly survey thatNAHB has been conducting for 30 yearsthe NAHBWells Fargo Housing MarketIndex gauges builder perceptions of currentsingle-family home sales and salesexpectations for the next six months asgood fair or poor The survey alsoasks builders to rate traffic of prospectivebuyers as high to very high average orlow to very low Scores for eachcomponent are then used to calculate aseasonally adjusted index where anynumber over 50 indicates that morebuilders view conditions as good than poor
All three HMI components postedmodest losses in December The indexmeasuring sales expectations in the nextsix months fell two points to 67 thecomponent gauging current salesconditions decreased one point to 66 andthe index charting buyer traffic dropped twopoints to 46
Looking at the three-month movingaverages for regional HMI scores the Westincreased three points to 76 while theNortheast rose a single point to 50Meanwhile the Midwest dropped two pointsto 58 and the South fell one point to 64
National
Builder News
7212019 Builders Outlook 2015 Issue 12
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Scott Sedam Professional Builder online
Yet for most of usmdashand I suggestfor everyone who has any bent towardprocess improvementmdashonce you havethat piece of knowledge know itsconsequences and are banged overthe head with continual reminders you
just canrsquot let it goEven more difficult is willful
ignorance whereby an individual orcompany makes the choice to ignorewhat Jim Collins termed ldquoObjectiveCurrent Realityrdquo I donrsquot have thetemper I had when I was young andsome now even describe me aspatient but encountering willfulignorance can push me right to theedge Many times I have counseledmdashtalked down in effectmdashyounger builderassociates who decided to ldquoface thebrutal factsrdquo (another Collins saying)on difficult issues while theircolleagues and bosses willfullyrefused I could be the only author inhistory to quote Jim Collins and CatStevens in the same article but duringthese talks Catrsquos old song ldquoFather ampSonrdquo comes to mind with the line ldquoItrsquosnot easy to be calm when yoursquovefound something going onrdquo
This is the sixth in a series of articlesin Professional Builder about processwaste how to identify and understandit and awakening to the reality that themajority of product waste has its roots
in bad process There are hundreds ofexamples of process failure thatseriously impede productivity and profitfor builders suppliers and tradesalike yet there is significant resistanceto tackling process obstacles head onGoing after product waste iscomparatively simple You can see ittouch it measure it test it Processwaste is a far bigger challenge
A Telling ExampleTo illustrate Irsquoll focus on one
example that I first wrote about 15years ago and have touched on manytimes since yet I see precious littleawareness shallow understandingand virtually no change despite theveritable gold mine that awaits thosewho solve it Even worse this issueoften generates fear in seniormanagers when confronted with it andIrsquoll admit I am still trying to work outwhatrsquos behind their reaction
Let me first suggest what theirresponse should be The inarguabledata comes in that there is a minimumof $10K waste per unit in your homeson a single process issue You areprofitable but at 20 percent grossmargin on your $300K units yoursquore notsetting the world on fire That $10Kwould increase your current grossmargin to above 23 percent whichwould make your investors very happyYou are building 100 units annually sothatrsquos a million bucks You should beecstatic but you arenrsquot In fact youdonrsquot even want to engage on this
issue Can you guess what this mightbe
This particular $10K (minimum)thatrsquos buried under every house in theUS and Canada is caused by wastedor otherwise unnecessary trips to thebuilding site I observed thisphenomenon first in my college years
as a loader in a large commerciallumberyard in Ohio I began to noticehow one builder in particular almostnever required extra trips to the sitesfor more materials He got it right thefirst time Three loads and done
That builder was extremely particularabout material species lengths andhow the loads should be stacked Forothers ldquohot shotrdquo runs were a way oflife Forty years later Irsquove learned theaverage lumber company requires fiveto seven additional trips to a sitebeyond what should have originallybeen required had things gone rightfrom the beginning This isnrsquot a roughguess We have had more than 200
lumber and material dealers participatein our LeanWeek sessions withbuilders and we have the data Forthese firms the trips average about$275 each without opportunity cost ahuge bullet that most studies calculateat about 50 percent of the raw cost
Think about this a moment Letrsquostake the average which is six trips ata very low calculation of $250 per triptotaling $1500 Thatrsquos a huge amountof cost that someone has to pay forHow many times do builders go to theirlumber dealers and appeal for a $200or $300 price cut Thatrsquos almostimpossible to get these days
But what if the builder calls thelumber company and suggests ldquoHowabout we work together this year toeliminate four of those six trips and weeach pocket more than $500rdquo Do youthink the lumber company would beinterested I have asked countlessgroups of builder personnel atconferences HBABIA meetingsBuilder 20 Groups etc how manycould show me that they have takenthe initiative to do this I never get a
raised hand Irsquove asked several groupsof lumber companies how many oftheir builders have ever offered Againno one But why Isnrsquot the benefitobvious
The average builder in the US orCanada writes checks to somewherebetween 30 and 60 firms in theprocess of building a house The lownumber is for builders using a lot ofturnkey relationships but 40 is a goodworking number Our data shows thatthe average number of extra trips runsaround 15 per suppliertrade Letrsquos beconservative and say the total numberof excess trips is 50 per house totalWith 4800 suppliers and trades now
having participated in our LeanWeekswe know that the conservative averagecost per trip is $200 Sure there are$50 trips but then there is thefoundation crew that eats up $800 fora single trip before doing any work
A couple of years ago wecommissioned a survey of suppliersand trades and received 497 of 600surveys backmdashan incredible responseWhen we totaled and averaged theircost per trip it came to $201 In short$200 is a solid number and again weare not counting the huge impact oflost opportunity so itrsquos actually quitelow in terms of real effect
Therersquos no denying it More than 50
trips at $200 each accounts for morethan $10K on the average $300Khome Be honest now Have you everreally gone after this If you still havedoubts therersquos one subtlety here thatfinally dawned on us after anelectrician became thoroughlyunplugged during one sessionpassionately explaining that buildersdonrsquot even realize that 80 percent ofthe wasted trips are happening Hedescribed how ldquodry runsrdquo where workcannot be started or a delivery madegenerate a lot of unpleasantcommunication The builder hearsabout it at least at the field level Theinsidious ones he went on are when a
two-day rough requires a third trip tocomplete due to a conflict misseddelivery etc and he and his fellowsuppliers and trades rarely say a word
They are good soldiers They just doit move on and take the hit Thisldquounable to completerdquo applies to virtuallyevery trade far more often thanbuilders ever realize and itrsquos notwithout significant cost
Irsquove asked literally thousands ofsuppliers and trades now whatpercentage of wasted trips do theyever even try to collect a trip chargeTheir answer less than 10 percentSimilarly I ask purchasing whatpercentage of the extra trip chargeinvoices that they see are approvedand paid by the builder They alsoanswer less than 10 percent Ponderthat This means builders actually payfor less than 1 percent of the wastedtrips to building sites The suppliersand trades eat this $10K on every oneof your homes or rather bury it in theiroverhead No matter the costs arethere
6 Builders Outlook 2 15 issue 12
Industry
Perspective
Process Failure
Product Waste In Home Building
Sometimes lifemdashand workmdashwould be easier if you could forget
some things yoursquove learned Blissful ignorance has its appeal not
just for individuals but for companies schools churches
governments and organizations of all kinds Just keep on doing
what yoursquore doing even if itrsquos not working so well Blame the
suppliers blame the trades blame your people blame the other
builders blame the market blame the press and blame the
government at every level No worries you have a long road to
travel before you get to blaming yourself
7212019 Builders Outlook 2015 Issue 12
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7 15 ISSUE 12 Builders Outlook
Time To Pay Up
So who ultimately pays Is this atthe heart of why builders avoidconfronting this critical process issue
Irsquove had several builders actually getangry with me for generatingawareness of the problem Theirconcern is they will suddenly get hitwith all sorts of trip charges It is truethat so many suppliers and trades out
there have eaten these costs for solong that they just think thatrsquos the wayhome building is and never try tocollect So is that an answer Keepthem in the dark and hope they remainunaware Do that if you are contentwith lower profit for you yoursuppliers and your trades
Right now there is no greater issueaffecting builder profitability in the USthan trade shortages It matters notwhere you live everyone thinks theyare the worst in the country Imaginefor a moment if you worked with yoursuppliers and trades in earnest andover the next couple of yearseliminated 80 percent of those extra
trips totaling $8K of cost What wouldhappen They would immediately getmore profitable at the same bid pricethey are getting now Several resultsaccrue First they will put you at thetop of their list because you haveclearly demonstrated you care abouttheir success Second they can bidyou more closely now knowing theywonrsquot have extra costs to bear Thirdyoursquoll get their best crews and nothingkeeps you on schedule and ensuresquality better than having the bestcrews Finally even beyond thosethree important factors you will makea lot more money To get it thoughyoursquoll have to make some changes
1 Why do our suppliers and tradeshave to make extra trips tobuilding sites that kill the scheduleand cost them money Becausewe lack complete detail on plansoptions and specifications
2 Why Because purchasing is sofar behind
3 Why Because we never givepurchasing enough time andinformation to get bids contractsand scopes done before a newproject opens
4 Why Because Product
Development is always behind
5 Why Because seniormanagement keeps changing theproduct
If a builder figured out what theywere going to build and stuck with itproduct development had plansspecifications and options determinedon time and purchasing had all theinformation it needed for 100 percentcomplete bid packages and startpackages would you reduce extratrips Would you make more moneyWould they make more money Thatcould go in many directions For
example in another company the rootmay be that Sales accepts too manylate or custom change orders In stillanother company it may be abreakdown in the POVPO system Instill another it could be poorscheduling practices No matter whatthe source this is a way to reducecost and stay on schedule
So donrsquot be afraid to make multipleiterations of the 5 Whys If you needsix or seven questions to get to theheart of the matter then do it In thefirst example above I would ask Whydoes senior management keepchanging the product It could bebecause they bought the land wrong
and what they had in mind originallywasnrsquot working Or because two newcompetitors opened down the road atthe identical price point Or it could
just be that the management teamcanrsquot ever make a decision and stickwith it
Compare that to dealing with aproduct issue such as whether toswitch from Siding A to Siding B or goto a higher level of carpet pad orchange the pitch of a roof Thatrsquos easyProcess resolution is far morecomplex and messy Any builder whostrongly commits to eliminating wastedtrips unavoidably commits to doing awhole lot of other things right and
thatrsquos why we know the money isthere I could have made this entirepoint with other processes but thewasted trip problem is the hardest todeal with that Irsquove encountered Thereis genuine fear in opening up tosuppliers and trades and admittingthat your process failures are hurtingtheir bottom line There is fear that ifyou blow it all yoursquoll get is a constantstream of trip charges leading tohigher cost There is fear that you willnever actually see the money yousave them All that fear adds up to abig mental roadblock That results inmaintaining business as usual andgoing the traditional route of trying to
negotiate lower cost In this market Iwish you luck
Will you allow fear to keep your backturned to this critical issue Will fearkeep you from facing the brutal factsof this and other process failures Ifear you will I hope you will not PB
---Scott Sedam is president of
TrueNorth Development For the latest PDF in this series ldquoBridging the Margin Gaprdquo send a request via email to infotruencom and include ldquoMargin Gaprdquo in the subject line
Make It HappenGet a team of your strongest people together from all parts of the companymdashnot justconstruction and estimatingmdashand brainstorm a list of everything yoursquod have to do toeliminate these extra trips The age-old Lean Six Sigma technique ldquoThe 5 Whysrdquo is perfect toget you started Letrsquos try it
7212019 Builders Outlook 2015 Issue 12
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Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 916
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
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HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
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Connect to the El Paso
Association of Builders
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
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7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
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2 Builders Outlook 2015 issue 12
HAPPY HOLIDAYS FROM YOUR
FRIENDS AT TEXAS GAS SERVICE
The holidays are a time to give thanks and celebrate with the ones you love
At Texas Gas Service wersquod like to express our gratitude to you for building with
natural gas and for giving your buyers the gift of savings We wish you and your
customers a safe and warm holiday season
Let us help you plan for natural gas right from the start
For more information
ElPasoNewBusinessTXGascom
William Nieves 915-496-6126
Jorge Sejera 915-680-7216
7212019 Builders Outlook 2015 Issue 12
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ldquoEditorrsquos note Edgar Montiel had prepared his farewell address for the installationawards banquet but through some excitement and overview we skipped his farewellHere it is more or less as it was to
be read My sincere apology to Edgar for the snafurdquo
I asked a couple of people what Ishould write for my last article and I amshocked that the answer I received themost was to just say ldquopeace outrdquo Somepeople carried that a little further andsaid that I should also drop themicrophone as I walked off in to thesunset Obviously I had to remindthem that this was a publication thoughI actually gave some thought to how Icould drop the microphone with wordsOne thing is for sure I will keep it short
I am so grateful to all of you for giving
me the opportunity to serve as yourPresident and am looking forward tobecoming part of the strong legacy ofpast presidents My role as Presidenthas allowed me to see firsthand all ofthe relationship fostering activitiesand issues that the association isconstantly managing Ray was notkidding when he said that the positionwould require a lot of time andcommitment I could not have fulfilled
my duties as President without the helpof my family and amazing constructionand sales staff thank you I also couldnot have done this without theguidance and support provided by RayMargaret and Frank Torres thank youI have learned a lot during my term onthe leadership ladder and can honestlysay that I am a better businessmanbecause of it I am super excited withthe positive direction that theassociation is headed with the currentladder and board Carlos Don and
Kathy are intelligent committedpersonable and will all do amazing jobs during their tenure
Being named the EPABrsquos Builder ofthe Year is truly an honor I cannotthank each of our team membersenough for all of their hard worksacrifice and dedication I especiallywant to thank my wife and kids theHarris Real Estate Group ourcustomers subcontractors suppliers
the City of El Paso all of our lendersand land developers Thank you
I thank all of you again for thisamazing opportunity and wisheveryone absolute success in 2016Merry Christmas and Peace Out
32015 issue 12 Builders Outlook
Edgar MontielPresidentEl Paso Associationof Builders
Peace Out
C
t asri
Northea
5500 NestsidW
ra2244 T Eastside
415 N MDownto
new year
ousosperfor a happy holiday and pr
arm wisheswe celebrate you Wcelebrate this holiday season -
No matter how you personally
comel-paso
8200
ow Bean Suite Dodrt
esert Suite A-2
ood Drive Suite 101
eet esa Strn
stewart
-225-519
o4712 W
Presidentrsquos
Message
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 416
Christmas is a time for kids Itrsquos atime for believing Itrsquos a time for
remembering If yoursquore like me bythe time the actual celebration date
comes around yoursquore tired Tired ofthe hustle that has become this holy
day the celebration of the birth ofJesus Christ in fulfillment of
prophecy Today we tend tosomehow forget that this is why we
have Christmas and shamefully wehide this fact by calling it a ldquowinterrdquo
holiday erasing the very meaning ofthe day Instead wersquore bombarded
with store sales movie releasesand all the things worldly rather than
holy For some of us it is time ofremembering those who canrsquot be
with us anymore either throughdeath divorce separation or
deployment Itrsquos the most stressfulholiday I can think of and that my
friends is why I particularly am a
humbug We tend to place so muchvalue to things rather than being
thankful for what we already haveRushing out to get a ldquogiftrdquo for
someone isnrsquot what we should bedoing We should be sharing what
we have to those less fortunate weshould be checking in on our elderly
making sure they have food andheat we should be giving to our
place of worship if we have one weshould be reaffirming our
relationships with each otherFamily as most think of it is the
most important thing we have yet weoften use this holiday to punish
those who we should love the mostI know from experience that this time
should be used to buildrelationships mend some and
prepare for the coming year Mydad died on Christmas day This
calendar date is hard for me
personally as I canrsquot ever think of thedate any other way than this is the
day my dad died Sorry but thatrsquoshow it is for me I love the fact that
we celebrate this date for the birth ofthe Christ Child and Irsquom willing to
celebrate with my family I do sobecause we have to move on Itrsquos
what we have to do in order not tolinger on the bad but to begin to
bring in the better A family isespecially important at this time I
hope you can share it with yoursIrsquom going to end my column with
some hope for 2 016 First andforemost I hope for a healthy
housing economy that helps ourmembers and in turn us I hope that
we grow our membership so that wecan share what we know and what
we do with those who donrsquot have aclue right now I hope that the city of
El Paso finds ways to govern
properly with less in fighting andmore work on roads bridges alleyrsquos
and less impediments like theroundabouts and corner structures
you canrsquot see at night I wish forTexDot to fix the huge pot holes on
the freeway I hope for more jobs tobe created and for the processes
towards that less cumbersome Ihope we get to vote for leading
candidates that give a damn aboutyou and me and the nation I hope
for less ldquopolitical correctnessrdquo andmore sensible action by government
I hope that our armed forces aregiven what is needed to win not just
to show up and I wish bettertreatment for our veterans I wish
for the end of Obamacare that ismaking our businesses less covered
and more broke I wish for betterhealth wealth and faith To you and
yours Merry Christmas
Ray Adauto
ExecutiveVice President
EPAB
4 Builders Outlook 2 15 issue 12
A time for hope
Executiversquos
Message
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 516
GINDILB
El P
soSIN 0951E
5 15 issue 12 Builders Outlook
Single-Family Starts ReachSeven-Year High983150 Nationwide housing starts rose 105
percent to a seasonally adjusted annualrate of 1173 million units in Novemberaccording to newly released data from theUS Department of Housing and UrbanDevelopment and the CommerceDepartment Single-family productionincreased 76 percent to a seasonallyadjusted annual rate of 768000 units itshighest reading since January 2008Multifamily production rose 164 percent to405000 units
ldquoThe November gains in both single- andmultifamily starts show that the overallmarket continues to move forwardrdquo said
NAHB Chairman Tom Woods a homebuilder from Blue Springs Mo ldquoAs buildersanticipate more consumer demand forhousing they should continue to addinventoryrdquo
ldquoSingle-family production this month hasreached levels last seen before the GreatRecession an indicator that we are makinggradual headway back to a normal housingmarketrdquo said NAHB Chief Economist DavidCrowe ldquoAs we close out the year we cansee that the housing sector has madeheadway in 2015 and we expect therecovery to continue at a modest pacerdquo
Combined single- and multifamily startsrose in the South and West with respective
gains of 213 and 63 percent The Midwestwas unchanged and the Northeast fell 85percent
Overall permit issuance rose 11 percentto 1289 million units in NovemberMultifamily permits rose 269 percent to arate of 566000 while single-family permitsincreased 11 percent to 723000 thehighest level since December 2007
Regionally the Midwest South and Westposted respective permit gains of 22percent 56 percent and 217 percentPermit levels in the Northeast held steady
New Home Sales Rise
107 Percent in October983150 Sales of newly built single-family homes
rose 107 percent to a seasonally adjustedannual rate of 495000 units in Octoberaccording to newly released data fromHUD and the US Census Bureau
ldquoOur builders are reporting continuedoptimism in the housing market and areadding inventory in anticipation of futurebusinessrdquo said Tom Woods chairman ofthe National Association of Home Builders(NAHB) and a home builder from BlueSprings Mo
ldquoSales this year are running 157 percentahead of 2014rdquo said NAHB ChiefEconomist David Crowe ldquoWith a firming job market affordable home prices and
rising pent-up demand todayrsquos report isanother indicator that the housing marketcontinues to move on a modest upwardtrajectoryrdquo
New-home sales were up in three out ofthe four regions Sales rose 1353 percentin the Northeast 53 percent in theMidwest and 89 percent in the SouthSales fell 09 percent in the West
The inventory of new homes for sale was226000 units in October This is a 55-month supply at the current sales pace
Builder Confidence EdgesDown One Point983150
Builder confidence in the market fornewly constructed single-family homesremained relatively flat in Decemberdropping one point to 61 on the NationalAssociation of Home BuildersWells FargoHousing Market Index (HMI)
ldquoOverall builders are optimistic about thehousing market although they arereporting concerns with the high price oflots and laborrdquo said NAHB Chairman TomWoods a home builder from Blue SpringsMo
ldquoFor the past seven months builderconfidence levels have averaged in the low60s which is in line with a gradualconsistent recoveryrdquo said NAHB ChiefEconomist David Crowe ldquoWith job creation
economic growth and growing householdformations we anticipate the housingmarket to continue to pick up traction as wehead into 2016rdquo
Derived from a monthly survey thatNAHB has been conducting for 30 yearsthe NAHBWells Fargo Housing MarketIndex gauges builder perceptions of currentsingle-family home sales and salesexpectations for the next six months asgood fair or poor The survey alsoasks builders to rate traffic of prospectivebuyers as high to very high average orlow to very low Scores for eachcomponent are then used to calculate aseasonally adjusted index where anynumber over 50 indicates that morebuilders view conditions as good than poor
All three HMI components postedmodest losses in December The indexmeasuring sales expectations in the nextsix months fell two points to 67 thecomponent gauging current salesconditions decreased one point to 66 andthe index charting buyer traffic dropped twopoints to 46
Looking at the three-month movingaverages for regional HMI scores the Westincreased three points to 76 while theNortheast rose a single point to 50Meanwhile the Midwest dropped two pointsto 58 and the South fell one point to 64
National
Builder News
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 616
Scott Sedam Professional Builder online
Yet for most of usmdashand I suggestfor everyone who has any bent towardprocess improvementmdashonce you havethat piece of knowledge know itsconsequences and are banged overthe head with continual reminders you
just canrsquot let it goEven more difficult is willful
ignorance whereby an individual orcompany makes the choice to ignorewhat Jim Collins termed ldquoObjectiveCurrent Realityrdquo I donrsquot have thetemper I had when I was young andsome now even describe me aspatient but encountering willfulignorance can push me right to theedge Many times I have counseledmdashtalked down in effectmdashyounger builderassociates who decided to ldquoface thebrutal factsrdquo (another Collins saying)on difficult issues while theircolleagues and bosses willfullyrefused I could be the only author inhistory to quote Jim Collins and CatStevens in the same article but duringthese talks Catrsquos old song ldquoFather ampSonrdquo comes to mind with the line ldquoItrsquosnot easy to be calm when yoursquovefound something going onrdquo
This is the sixth in a series of articlesin Professional Builder about processwaste how to identify and understandit and awakening to the reality that themajority of product waste has its roots
in bad process There are hundreds ofexamples of process failure thatseriously impede productivity and profitfor builders suppliers and tradesalike yet there is significant resistanceto tackling process obstacles head onGoing after product waste iscomparatively simple You can see ittouch it measure it test it Processwaste is a far bigger challenge
A Telling ExampleTo illustrate Irsquoll focus on one
example that I first wrote about 15years ago and have touched on manytimes since yet I see precious littleawareness shallow understandingand virtually no change despite theveritable gold mine that awaits thosewho solve it Even worse this issueoften generates fear in seniormanagers when confronted with it andIrsquoll admit I am still trying to work outwhatrsquos behind their reaction
Let me first suggest what theirresponse should be The inarguabledata comes in that there is a minimumof $10K waste per unit in your homeson a single process issue You areprofitable but at 20 percent grossmargin on your $300K units yoursquore notsetting the world on fire That $10Kwould increase your current grossmargin to above 23 percent whichwould make your investors very happyYou are building 100 units annually sothatrsquos a million bucks You should beecstatic but you arenrsquot In fact youdonrsquot even want to engage on this
issue Can you guess what this mightbe
This particular $10K (minimum)thatrsquos buried under every house in theUS and Canada is caused by wastedor otherwise unnecessary trips to thebuilding site I observed thisphenomenon first in my college years
as a loader in a large commerciallumberyard in Ohio I began to noticehow one builder in particular almostnever required extra trips to the sitesfor more materials He got it right thefirst time Three loads and done
That builder was extremely particularabout material species lengths andhow the loads should be stacked Forothers ldquohot shotrdquo runs were a way oflife Forty years later Irsquove learned theaverage lumber company requires fiveto seven additional trips to a sitebeyond what should have originallybeen required had things gone rightfrom the beginning This isnrsquot a roughguess We have had more than 200
lumber and material dealers participatein our LeanWeek sessions withbuilders and we have the data Forthese firms the trips average about$275 each without opportunity cost ahuge bullet that most studies calculateat about 50 percent of the raw cost
Think about this a moment Letrsquostake the average which is six trips ata very low calculation of $250 per triptotaling $1500 Thatrsquos a huge amountof cost that someone has to pay forHow many times do builders go to theirlumber dealers and appeal for a $200or $300 price cut Thatrsquos almostimpossible to get these days
But what if the builder calls thelumber company and suggests ldquoHowabout we work together this year toeliminate four of those six trips and weeach pocket more than $500rdquo Do youthink the lumber company would beinterested I have asked countlessgroups of builder personnel atconferences HBABIA meetingsBuilder 20 Groups etc how manycould show me that they have takenthe initiative to do this I never get a
raised hand Irsquove asked several groupsof lumber companies how many oftheir builders have ever offered Againno one But why Isnrsquot the benefitobvious
The average builder in the US orCanada writes checks to somewherebetween 30 and 60 firms in theprocess of building a house The lownumber is for builders using a lot ofturnkey relationships but 40 is a goodworking number Our data shows thatthe average number of extra trips runsaround 15 per suppliertrade Letrsquos beconservative and say the total numberof excess trips is 50 per house totalWith 4800 suppliers and trades now
having participated in our LeanWeekswe know that the conservative averagecost per trip is $200 Sure there are$50 trips but then there is thefoundation crew that eats up $800 fora single trip before doing any work
A couple of years ago wecommissioned a survey of suppliersand trades and received 497 of 600surveys backmdashan incredible responseWhen we totaled and averaged theircost per trip it came to $201 In short$200 is a solid number and again weare not counting the huge impact oflost opportunity so itrsquos actually quitelow in terms of real effect
Therersquos no denying it More than 50
trips at $200 each accounts for morethan $10K on the average $300Khome Be honest now Have you everreally gone after this If you still havedoubts therersquos one subtlety here thatfinally dawned on us after anelectrician became thoroughlyunplugged during one sessionpassionately explaining that buildersdonrsquot even realize that 80 percent ofthe wasted trips are happening Hedescribed how ldquodry runsrdquo where workcannot be started or a delivery madegenerate a lot of unpleasantcommunication The builder hearsabout it at least at the field level Theinsidious ones he went on are when a
two-day rough requires a third trip tocomplete due to a conflict misseddelivery etc and he and his fellowsuppliers and trades rarely say a word
They are good soldiers They just doit move on and take the hit Thisldquounable to completerdquo applies to virtuallyevery trade far more often thanbuilders ever realize and itrsquos notwithout significant cost
Irsquove asked literally thousands ofsuppliers and trades now whatpercentage of wasted trips do theyever even try to collect a trip chargeTheir answer less than 10 percentSimilarly I ask purchasing whatpercentage of the extra trip chargeinvoices that they see are approvedand paid by the builder They alsoanswer less than 10 percent Ponderthat This means builders actually payfor less than 1 percent of the wastedtrips to building sites The suppliersand trades eat this $10K on every oneof your homes or rather bury it in theiroverhead No matter the costs arethere
6 Builders Outlook 2 15 issue 12
Industry
Perspective
Process Failure
Product Waste In Home Building
Sometimes lifemdashand workmdashwould be easier if you could forget
some things yoursquove learned Blissful ignorance has its appeal not
just for individuals but for companies schools churches
governments and organizations of all kinds Just keep on doing
what yoursquore doing even if itrsquos not working so well Blame the
suppliers blame the trades blame your people blame the other
builders blame the market blame the press and blame the
government at every level No worries you have a long road to
travel before you get to blaming yourself
7212019 Builders Outlook 2015 Issue 12
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7 15 ISSUE 12 Builders Outlook
Time To Pay Up
So who ultimately pays Is this atthe heart of why builders avoidconfronting this critical process issue
Irsquove had several builders actually getangry with me for generatingawareness of the problem Theirconcern is they will suddenly get hitwith all sorts of trip charges It is truethat so many suppliers and trades out
there have eaten these costs for solong that they just think thatrsquos the wayhome building is and never try tocollect So is that an answer Keepthem in the dark and hope they remainunaware Do that if you are contentwith lower profit for you yoursuppliers and your trades
Right now there is no greater issueaffecting builder profitability in the USthan trade shortages It matters notwhere you live everyone thinks theyare the worst in the country Imaginefor a moment if you worked with yoursuppliers and trades in earnest andover the next couple of yearseliminated 80 percent of those extra
trips totaling $8K of cost What wouldhappen They would immediately getmore profitable at the same bid pricethey are getting now Several resultsaccrue First they will put you at thetop of their list because you haveclearly demonstrated you care abouttheir success Second they can bidyou more closely now knowing theywonrsquot have extra costs to bear Thirdyoursquoll get their best crews and nothingkeeps you on schedule and ensuresquality better than having the bestcrews Finally even beyond thosethree important factors you will makea lot more money To get it thoughyoursquoll have to make some changes
1 Why do our suppliers and tradeshave to make extra trips tobuilding sites that kill the scheduleand cost them money Becausewe lack complete detail on plansoptions and specifications
2 Why Because purchasing is sofar behind
3 Why Because we never givepurchasing enough time andinformation to get bids contractsand scopes done before a newproject opens
4 Why Because Product
Development is always behind
5 Why Because seniormanagement keeps changing theproduct
If a builder figured out what theywere going to build and stuck with itproduct development had plansspecifications and options determinedon time and purchasing had all theinformation it needed for 100 percentcomplete bid packages and startpackages would you reduce extratrips Would you make more moneyWould they make more money Thatcould go in many directions For
example in another company the rootmay be that Sales accepts too manylate or custom change orders In stillanother company it may be abreakdown in the POVPO system Instill another it could be poorscheduling practices No matter whatthe source this is a way to reducecost and stay on schedule
So donrsquot be afraid to make multipleiterations of the 5 Whys If you needsix or seven questions to get to theheart of the matter then do it In thefirst example above I would ask Whydoes senior management keepchanging the product It could bebecause they bought the land wrong
and what they had in mind originallywasnrsquot working Or because two newcompetitors opened down the road atthe identical price point Or it could
just be that the management teamcanrsquot ever make a decision and stickwith it
Compare that to dealing with aproduct issue such as whether toswitch from Siding A to Siding B or goto a higher level of carpet pad orchange the pitch of a roof Thatrsquos easyProcess resolution is far morecomplex and messy Any builder whostrongly commits to eliminating wastedtrips unavoidably commits to doing awhole lot of other things right and
thatrsquos why we know the money isthere I could have made this entirepoint with other processes but thewasted trip problem is the hardest todeal with that Irsquove encountered Thereis genuine fear in opening up tosuppliers and trades and admittingthat your process failures are hurtingtheir bottom line There is fear that ifyou blow it all yoursquoll get is a constantstream of trip charges leading tohigher cost There is fear that you willnever actually see the money yousave them All that fear adds up to abig mental roadblock That results inmaintaining business as usual andgoing the traditional route of trying to
negotiate lower cost In this market Iwish you luck
Will you allow fear to keep your backturned to this critical issue Will fearkeep you from facing the brutal factsof this and other process failures Ifear you will I hope you will not PB
---Scott Sedam is president of
TrueNorth Development For the latest PDF in this series ldquoBridging the Margin Gaprdquo send a request via email to infotruencom and include ldquoMargin Gaprdquo in the subject line
Make It HappenGet a team of your strongest people together from all parts of the companymdashnot justconstruction and estimatingmdashand brainstorm a list of everything yoursquod have to do toeliminate these extra trips The age-old Lean Six Sigma technique ldquoThe 5 Whysrdquo is perfect toget you started Letrsquos try it
7212019 Builders Outlook 2015 Issue 12
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Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
Pioneer Bank understands
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ancial needs we provides or personal whatever
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oans
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ersonal andP
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usness ec ng
FREE Checking
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s the latest innovationsan s your nee s an
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in
oansortgage
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ay Online Bill P
tatementseS
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Internet amp Mobile
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emote De osit
one - aso015 N Mesa
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r
S
R
e s l e
r D
r
N M e s a S t
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N
one - aso068 Gateway East
ona
2290
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Gat ew ay E as t
Tra
e - o
Trawood
for more detailsee an represenepending on acco250000 Services
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L e e
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Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
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overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
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rcial Umbrella
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HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
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7212019 Builders Outlook 2015 Issue 12
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13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
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7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
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ldquoEditorrsquos note Edgar Montiel had prepared his farewell address for the installationawards banquet but through some excitement and overview we skipped his farewellHere it is more or less as it was to
be read My sincere apology to Edgar for the snafurdquo
I asked a couple of people what Ishould write for my last article and I amshocked that the answer I received themost was to just say ldquopeace outrdquo Somepeople carried that a little further andsaid that I should also drop themicrophone as I walked off in to thesunset Obviously I had to remindthem that this was a publication thoughI actually gave some thought to how Icould drop the microphone with wordsOne thing is for sure I will keep it short
I am so grateful to all of you for giving
me the opportunity to serve as yourPresident and am looking forward tobecoming part of the strong legacy ofpast presidents My role as Presidenthas allowed me to see firsthand all ofthe relationship fostering activitiesand issues that the association isconstantly managing Ray was notkidding when he said that the positionwould require a lot of time andcommitment I could not have fulfilled
my duties as President without the helpof my family and amazing constructionand sales staff thank you I also couldnot have done this without theguidance and support provided by RayMargaret and Frank Torres thank youI have learned a lot during my term onthe leadership ladder and can honestlysay that I am a better businessmanbecause of it I am super excited withthe positive direction that theassociation is headed with the currentladder and board Carlos Don and
Kathy are intelligent committedpersonable and will all do amazing jobs during their tenure
Being named the EPABrsquos Builder ofthe Year is truly an honor I cannotthank each of our team membersenough for all of their hard worksacrifice and dedication I especiallywant to thank my wife and kids theHarris Real Estate Group ourcustomers subcontractors suppliers
the City of El Paso all of our lendersand land developers Thank you
I thank all of you again for thisamazing opportunity and wisheveryone absolute success in 2016Merry Christmas and Peace Out
32015 issue 12 Builders Outlook
Edgar MontielPresidentEl Paso Associationof Builders
Peace Out
C
t asri
Northea
5500 NestsidW
ra2244 T Eastside
415 N MDownto
new year
ousosperfor a happy holiday and pr
arm wisheswe celebrate you Wcelebrate this holiday season -
No matter how you personally
comel-paso
8200
ow Bean Suite Dodrt
esert Suite A-2
ood Drive Suite 101
eet esa Strn
stewart
-225-519
o4712 W
Presidentrsquos
Message
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 416
Christmas is a time for kids Itrsquos atime for believing Itrsquos a time for
remembering If yoursquore like me bythe time the actual celebration date
comes around yoursquore tired Tired ofthe hustle that has become this holy
day the celebration of the birth ofJesus Christ in fulfillment of
prophecy Today we tend tosomehow forget that this is why we
have Christmas and shamefully wehide this fact by calling it a ldquowinterrdquo
holiday erasing the very meaning ofthe day Instead wersquore bombarded
with store sales movie releasesand all the things worldly rather than
holy For some of us it is time ofremembering those who canrsquot be
with us anymore either throughdeath divorce separation or
deployment Itrsquos the most stressfulholiday I can think of and that my
friends is why I particularly am a
humbug We tend to place so muchvalue to things rather than being
thankful for what we already haveRushing out to get a ldquogiftrdquo for
someone isnrsquot what we should bedoing We should be sharing what
we have to those less fortunate weshould be checking in on our elderly
making sure they have food andheat we should be giving to our
place of worship if we have one weshould be reaffirming our
relationships with each otherFamily as most think of it is the
most important thing we have yet weoften use this holiday to punish
those who we should love the mostI know from experience that this time
should be used to buildrelationships mend some and
prepare for the coming year Mydad died on Christmas day This
calendar date is hard for me
personally as I canrsquot ever think of thedate any other way than this is the
day my dad died Sorry but thatrsquoshow it is for me I love the fact that
we celebrate this date for the birth ofthe Christ Child and Irsquom willing to
celebrate with my family I do sobecause we have to move on Itrsquos
what we have to do in order not tolinger on the bad but to begin to
bring in the better A family isespecially important at this time I
hope you can share it with yoursIrsquom going to end my column with
some hope for 2 016 First andforemost I hope for a healthy
housing economy that helps ourmembers and in turn us I hope that
we grow our membership so that wecan share what we know and what
we do with those who donrsquot have aclue right now I hope that the city of
El Paso finds ways to govern
properly with less in fighting andmore work on roads bridges alleyrsquos
and less impediments like theroundabouts and corner structures
you canrsquot see at night I wish forTexDot to fix the huge pot holes on
the freeway I hope for more jobs tobe created and for the processes
towards that less cumbersome Ihope we get to vote for leading
candidates that give a damn aboutyou and me and the nation I hope
for less ldquopolitical correctnessrdquo andmore sensible action by government
I hope that our armed forces aregiven what is needed to win not just
to show up and I wish bettertreatment for our veterans I wish
for the end of Obamacare that ismaking our businesses less covered
and more broke I wish for betterhealth wealth and faith To you and
yours Merry Christmas
Ray Adauto
ExecutiveVice President
EPAB
4 Builders Outlook 2 15 issue 12
A time for hope
Executiversquos
Message
7212019 Builders Outlook 2015 Issue 12
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GINDILB
El P
soSIN 0951E
5 15 issue 12 Builders Outlook
Single-Family Starts ReachSeven-Year High983150 Nationwide housing starts rose 105
percent to a seasonally adjusted annualrate of 1173 million units in Novemberaccording to newly released data from theUS Department of Housing and UrbanDevelopment and the CommerceDepartment Single-family productionincreased 76 percent to a seasonallyadjusted annual rate of 768000 units itshighest reading since January 2008Multifamily production rose 164 percent to405000 units
ldquoThe November gains in both single- andmultifamily starts show that the overallmarket continues to move forwardrdquo said
NAHB Chairman Tom Woods a homebuilder from Blue Springs Mo ldquoAs buildersanticipate more consumer demand forhousing they should continue to addinventoryrdquo
ldquoSingle-family production this month hasreached levels last seen before the GreatRecession an indicator that we are makinggradual headway back to a normal housingmarketrdquo said NAHB Chief Economist DavidCrowe ldquoAs we close out the year we cansee that the housing sector has madeheadway in 2015 and we expect therecovery to continue at a modest pacerdquo
Combined single- and multifamily startsrose in the South and West with respective
gains of 213 and 63 percent The Midwestwas unchanged and the Northeast fell 85percent
Overall permit issuance rose 11 percentto 1289 million units in NovemberMultifamily permits rose 269 percent to arate of 566000 while single-family permitsincreased 11 percent to 723000 thehighest level since December 2007
Regionally the Midwest South and Westposted respective permit gains of 22percent 56 percent and 217 percentPermit levels in the Northeast held steady
New Home Sales Rise
107 Percent in October983150 Sales of newly built single-family homes
rose 107 percent to a seasonally adjustedannual rate of 495000 units in Octoberaccording to newly released data fromHUD and the US Census Bureau
ldquoOur builders are reporting continuedoptimism in the housing market and areadding inventory in anticipation of futurebusinessrdquo said Tom Woods chairman ofthe National Association of Home Builders(NAHB) and a home builder from BlueSprings Mo
ldquoSales this year are running 157 percentahead of 2014rdquo said NAHB ChiefEconomist David Crowe ldquoWith a firming job market affordable home prices and
rising pent-up demand todayrsquos report isanother indicator that the housing marketcontinues to move on a modest upwardtrajectoryrdquo
New-home sales were up in three out ofthe four regions Sales rose 1353 percentin the Northeast 53 percent in theMidwest and 89 percent in the SouthSales fell 09 percent in the West
The inventory of new homes for sale was226000 units in October This is a 55-month supply at the current sales pace
Builder Confidence EdgesDown One Point983150
Builder confidence in the market fornewly constructed single-family homesremained relatively flat in Decemberdropping one point to 61 on the NationalAssociation of Home BuildersWells FargoHousing Market Index (HMI)
ldquoOverall builders are optimistic about thehousing market although they arereporting concerns with the high price oflots and laborrdquo said NAHB Chairman TomWoods a home builder from Blue SpringsMo
ldquoFor the past seven months builderconfidence levels have averaged in the low60s which is in line with a gradualconsistent recoveryrdquo said NAHB ChiefEconomist David Crowe ldquoWith job creation
economic growth and growing householdformations we anticipate the housingmarket to continue to pick up traction as wehead into 2016rdquo
Derived from a monthly survey thatNAHB has been conducting for 30 yearsthe NAHBWells Fargo Housing MarketIndex gauges builder perceptions of currentsingle-family home sales and salesexpectations for the next six months asgood fair or poor The survey alsoasks builders to rate traffic of prospectivebuyers as high to very high average orlow to very low Scores for eachcomponent are then used to calculate aseasonally adjusted index where anynumber over 50 indicates that morebuilders view conditions as good than poor
All three HMI components postedmodest losses in December The indexmeasuring sales expectations in the nextsix months fell two points to 67 thecomponent gauging current salesconditions decreased one point to 66 andthe index charting buyer traffic dropped twopoints to 46
Looking at the three-month movingaverages for regional HMI scores the Westincreased three points to 76 while theNortheast rose a single point to 50Meanwhile the Midwest dropped two pointsto 58 and the South fell one point to 64
National
Builder News
7212019 Builders Outlook 2015 Issue 12
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Scott Sedam Professional Builder online
Yet for most of usmdashand I suggestfor everyone who has any bent towardprocess improvementmdashonce you havethat piece of knowledge know itsconsequences and are banged overthe head with continual reminders you
just canrsquot let it goEven more difficult is willful
ignorance whereby an individual orcompany makes the choice to ignorewhat Jim Collins termed ldquoObjectiveCurrent Realityrdquo I donrsquot have thetemper I had when I was young andsome now even describe me aspatient but encountering willfulignorance can push me right to theedge Many times I have counseledmdashtalked down in effectmdashyounger builderassociates who decided to ldquoface thebrutal factsrdquo (another Collins saying)on difficult issues while theircolleagues and bosses willfullyrefused I could be the only author inhistory to quote Jim Collins and CatStevens in the same article but duringthese talks Catrsquos old song ldquoFather ampSonrdquo comes to mind with the line ldquoItrsquosnot easy to be calm when yoursquovefound something going onrdquo
This is the sixth in a series of articlesin Professional Builder about processwaste how to identify and understandit and awakening to the reality that themajority of product waste has its roots
in bad process There are hundreds ofexamples of process failure thatseriously impede productivity and profitfor builders suppliers and tradesalike yet there is significant resistanceto tackling process obstacles head onGoing after product waste iscomparatively simple You can see ittouch it measure it test it Processwaste is a far bigger challenge
A Telling ExampleTo illustrate Irsquoll focus on one
example that I first wrote about 15years ago and have touched on manytimes since yet I see precious littleawareness shallow understandingand virtually no change despite theveritable gold mine that awaits thosewho solve it Even worse this issueoften generates fear in seniormanagers when confronted with it andIrsquoll admit I am still trying to work outwhatrsquos behind their reaction
Let me first suggest what theirresponse should be The inarguabledata comes in that there is a minimumof $10K waste per unit in your homeson a single process issue You areprofitable but at 20 percent grossmargin on your $300K units yoursquore notsetting the world on fire That $10Kwould increase your current grossmargin to above 23 percent whichwould make your investors very happyYou are building 100 units annually sothatrsquos a million bucks You should beecstatic but you arenrsquot In fact youdonrsquot even want to engage on this
issue Can you guess what this mightbe
This particular $10K (minimum)thatrsquos buried under every house in theUS and Canada is caused by wastedor otherwise unnecessary trips to thebuilding site I observed thisphenomenon first in my college years
as a loader in a large commerciallumberyard in Ohio I began to noticehow one builder in particular almostnever required extra trips to the sitesfor more materials He got it right thefirst time Three loads and done
That builder was extremely particularabout material species lengths andhow the loads should be stacked Forothers ldquohot shotrdquo runs were a way oflife Forty years later Irsquove learned theaverage lumber company requires fiveto seven additional trips to a sitebeyond what should have originallybeen required had things gone rightfrom the beginning This isnrsquot a roughguess We have had more than 200
lumber and material dealers participatein our LeanWeek sessions withbuilders and we have the data Forthese firms the trips average about$275 each without opportunity cost ahuge bullet that most studies calculateat about 50 percent of the raw cost
Think about this a moment Letrsquostake the average which is six trips ata very low calculation of $250 per triptotaling $1500 Thatrsquos a huge amountof cost that someone has to pay forHow many times do builders go to theirlumber dealers and appeal for a $200or $300 price cut Thatrsquos almostimpossible to get these days
But what if the builder calls thelumber company and suggests ldquoHowabout we work together this year toeliminate four of those six trips and weeach pocket more than $500rdquo Do youthink the lumber company would beinterested I have asked countlessgroups of builder personnel atconferences HBABIA meetingsBuilder 20 Groups etc how manycould show me that they have takenthe initiative to do this I never get a
raised hand Irsquove asked several groupsof lumber companies how many oftheir builders have ever offered Againno one But why Isnrsquot the benefitobvious
The average builder in the US orCanada writes checks to somewherebetween 30 and 60 firms in theprocess of building a house The lownumber is for builders using a lot ofturnkey relationships but 40 is a goodworking number Our data shows thatthe average number of extra trips runsaround 15 per suppliertrade Letrsquos beconservative and say the total numberof excess trips is 50 per house totalWith 4800 suppliers and trades now
having participated in our LeanWeekswe know that the conservative averagecost per trip is $200 Sure there are$50 trips but then there is thefoundation crew that eats up $800 fora single trip before doing any work
A couple of years ago wecommissioned a survey of suppliersand trades and received 497 of 600surveys backmdashan incredible responseWhen we totaled and averaged theircost per trip it came to $201 In short$200 is a solid number and again weare not counting the huge impact oflost opportunity so itrsquos actually quitelow in terms of real effect
Therersquos no denying it More than 50
trips at $200 each accounts for morethan $10K on the average $300Khome Be honest now Have you everreally gone after this If you still havedoubts therersquos one subtlety here thatfinally dawned on us after anelectrician became thoroughlyunplugged during one sessionpassionately explaining that buildersdonrsquot even realize that 80 percent ofthe wasted trips are happening Hedescribed how ldquodry runsrdquo where workcannot be started or a delivery madegenerate a lot of unpleasantcommunication The builder hearsabout it at least at the field level Theinsidious ones he went on are when a
two-day rough requires a third trip tocomplete due to a conflict misseddelivery etc and he and his fellowsuppliers and trades rarely say a word
They are good soldiers They just doit move on and take the hit Thisldquounable to completerdquo applies to virtuallyevery trade far more often thanbuilders ever realize and itrsquos notwithout significant cost
Irsquove asked literally thousands ofsuppliers and trades now whatpercentage of wasted trips do theyever even try to collect a trip chargeTheir answer less than 10 percentSimilarly I ask purchasing whatpercentage of the extra trip chargeinvoices that they see are approvedand paid by the builder They alsoanswer less than 10 percent Ponderthat This means builders actually payfor less than 1 percent of the wastedtrips to building sites The suppliersand trades eat this $10K on every oneof your homes or rather bury it in theiroverhead No matter the costs arethere
6 Builders Outlook 2 15 issue 12
Industry
Perspective
Process Failure
Product Waste In Home Building
Sometimes lifemdashand workmdashwould be easier if you could forget
some things yoursquove learned Blissful ignorance has its appeal not
just for individuals but for companies schools churches
governments and organizations of all kinds Just keep on doing
what yoursquore doing even if itrsquos not working so well Blame the
suppliers blame the trades blame your people blame the other
builders blame the market blame the press and blame the
government at every level No worries you have a long road to
travel before you get to blaming yourself
7212019 Builders Outlook 2015 Issue 12
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7 15 ISSUE 12 Builders Outlook
Time To Pay Up
So who ultimately pays Is this atthe heart of why builders avoidconfronting this critical process issue
Irsquove had several builders actually getangry with me for generatingawareness of the problem Theirconcern is they will suddenly get hitwith all sorts of trip charges It is truethat so many suppliers and trades out
there have eaten these costs for solong that they just think thatrsquos the wayhome building is and never try tocollect So is that an answer Keepthem in the dark and hope they remainunaware Do that if you are contentwith lower profit for you yoursuppliers and your trades
Right now there is no greater issueaffecting builder profitability in the USthan trade shortages It matters notwhere you live everyone thinks theyare the worst in the country Imaginefor a moment if you worked with yoursuppliers and trades in earnest andover the next couple of yearseliminated 80 percent of those extra
trips totaling $8K of cost What wouldhappen They would immediately getmore profitable at the same bid pricethey are getting now Several resultsaccrue First they will put you at thetop of their list because you haveclearly demonstrated you care abouttheir success Second they can bidyou more closely now knowing theywonrsquot have extra costs to bear Thirdyoursquoll get their best crews and nothingkeeps you on schedule and ensuresquality better than having the bestcrews Finally even beyond thosethree important factors you will makea lot more money To get it thoughyoursquoll have to make some changes
1 Why do our suppliers and tradeshave to make extra trips tobuilding sites that kill the scheduleand cost them money Becausewe lack complete detail on plansoptions and specifications
2 Why Because purchasing is sofar behind
3 Why Because we never givepurchasing enough time andinformation to get bids contractsand scopes done before a newproject opens
4 Why Because Product
Development is always behind
5 Why Because seniormanagement keeps changing theproduct
If a builder figured out what theywere going to build and stuck with itproduct development had plansspecifications and options determinedon time and purchasing had all theinformation it needed for 100 percentcomplete bid packages and startpackages would you reduce extratrips Would you make more moneyWould they make more money Thatcould go in many directions For
example in another company the rootmay be that Sales accepts too manylate or custom change orders In stillanother company it may be abreakdown in the POVPO system Instill another it could be poorscheduling practices No matter whatthe source this is a way to reducecost and stay on schedule
So donrsquot be afraid to make multipleiterations of the 5 Whys If you needsix or seven questions to get to theheart of the matter then do it In thefirst example above I would ask Whydoes senior management keepchanging the product It could bebecause they bought the land wrong
and what they had in mind originallywasnrsquot working Or because two newcompetitors opened down the road atthe identical price point Or it could
just be that the management teamcanrsquot ever make a decision and stickwith it
Compare that to dealing with aproduct issue such as whether toswitch from Siding A to Siding B or goto a higher level of carpet pad orchange the pitch of a roof Thatrsquos easyProcess resolution is far morecomplex and messy Any builder whostrongly commits to eliminating wastedtrips unavoidably commits to doing awhole lot of other things right and
thatrsquos why we know the money isthere I could have made this entirepoint with other processes but thewasted trip problem is the hardest todeal with that Irsquove encountered Thereis genuine fear in opening up tosuppliers and trades and admittingthat your process failures are hurtingtheir bottom line There is fear that ifyou blow it all yoursquoll get is a constantstream of trip charges leading tohigher cost There is fear that you willnever actually see the money yousave them All that fear adds up to abig mental roadblock That results inmaintaining business as usual andgoing the traditional route of trying to
negotiate lower cost In this market Iwish you luck
Will you allow fear to keep your backturned to this critical issue Will fearkeep you from facing the brutal factsof this and other process failures Ifear you will I hope you will not PB
---Scott Sedam is president of
TrueNorth Development For the latest PDF in this series ldquoBridging the Margin Gaprdquo send a request via email to infotruencom and include ldquoMargin Gaprdquo in the subject line
Make It HappenGet a team of your strongest people together from all parts of the companymdashnot justconstruction and estimatingmdashand brainstorm a list of everything yoursquod have to do toeliminate these extra trips The age-old Lean Six Sigma technique ldquoThe 5 Whysrdquo is perfect toget you started Letrsquos try it
7212019 Builders Outlook 2015 Issue 12
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Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
Pioneer Bank understands
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worry ng
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your finBusine lWhencommuPionee
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ancial needs we provides or personal whatever
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ersonal andP
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usness ec ng
FREE Checking
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solutio
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s the latest innovationsan s your nee s an
Pioneer BankyBill P nd additional bills from
edit card mdash then pay l
s to help you succeed
in
oansortgage
R
ay Online Bill P
tatementseS
Banking
Internet amp Mobile
Merchant Services
emote De osit
one - aso015 N Mesa
S
R e s l e r D
r
S
R
e s l e
r D
r
N M e s a S t
N M e s a S t
N
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Gat ew ay E as t
Tra
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Trawood
for more detailsee an represenepending on acco250000 Services
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L e e
T r evi n o
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Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
ldquoArdquo ra ted ca rriers sev eral a vailable
overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
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HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
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12 Builders Outlook 2015 issue 12
Trends
Technology Construction
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7212019 Builders Outlook 2015 Issue 12
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13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
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BOARD MEETING
12 NOON
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JANUARY 19-21
IBS SHOW
LAS VEGAS NV
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EVENTSWELCOME BACK
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Connect to the El Paso
Association of Builders
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7212019 Builders Outlook 2015 Issue 12
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The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
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7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
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Christmas is a time for kids Itrsquos atime for believing Itrsquos a time for
remembering If yoursquore like me bythe time the actual celebration date
comes around yoursquore tired Tired ofthe hustle that has become this holy
day the celebration of the birth ofJesus Christ in fulfillment of
prophecy Today we tend tosomehow forget that this is why we
have Christmas and shamefully wehide this fact by calling it a ldquowinterrdquo
holiday erasing the very meaning ofthe day Instead wersquore bombarded
with store sales movie releasesand all the things worldly rather than
holy For some of us it is time ofremembering those who canrsquot be
with us anymore either throughdeath divorce separation or
deployment Itrsquos the most stressfulholiday I can think of and that my
friends is why I particularly am a
humbug We tend to place so muchvalue to things rather than being
thankful for what we already haveRushing out to get a ldquogiftrdquo for
someone isnrsquot what we should bedoing We should be sharing what
we have to those less fortunate weshould be checking in on our elderly
making sure they have food andheat we should be giving to our
place of worship if we have one weshould be reaffirming our
relationships with each otherFamily as most think of it is the
most important thing we have yet weoften use this holiday to punish
those who we should love the mostI know from experience that this time
should be used to buildrelationships mend some and
prepare for the coming year Mydad died on Christmas day This
calendar date is hard for me
personally as I canrsquot ever think of thedate any other way than this is the
day my dad died Sorry but thatrsquoshow it is for me I love the fact that
we celebrate this date for the birth ofthe Christ Child and Irsquom willing to
celebrate with my family I do sobecause we have to move on Itrsquos
what we have to do in order not tolinger on the bad but to begin to
bring in the better A family isespecially important at this time I
hope you can share it with yoursIrsquom going to end my column with
some hope for 2 016 First andforemost I hope for a healthy
housing economy that helps ourmembers and in turn us I hope that
we grow our membership so that wecan share what we know and what
we do with those who donrsquot have aclue right now I hope that the city of
El Paso finds ways to govern
properly with less in fighting andmore work on roads bridges alleyrsquos
and less impediments like theroundabouts and corner structures
you canrsquot see at night I wish forTexDot to fix the huge pot holes on
the freeway I hope for more jobs tobe created and for the processes
towards that less cumbersome Ihope we get to vote for leading
candidates that give a damn aboutyou and me and the nation I hope
for less ldquopolitical correctnessrdquo andmore sensible action by government
I hope that our armed forces aregiven what is needed to win not just
to show up and I wish bettertreatment for our veterans I wish
for the end of Obamacare that ismaking our businesses less covered
and more broke I wish for betterhealth wealth and faith To you and
yours Merry Christmas
Ray Adauto
ExecutiveVice President
EPAB
4 Builders Outlook 2 15 issue 12
A time for hope
Executiversquos
Message
7212019 Builders Outlook 2015 Issue 12
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GINDILB
El P
soSIN 0951E
5 15 issue 12 Builders Outlook
Single-Family Starts ReachSeven-Year High983150 Nationwide housing starts rose 105
percent to a seasonally adjusted annualrate of 1173 million units in Novemberaccording to newly released data from theUS Department of Housing and UrbanDevelopment and the CommerceDepartment Single-family productionincreased 76 percent to a seasonallyadjusted annual rate of 768000 units itshighest reading since January 2008Multifamily production rose 164 percent to405000 units
ldquoThe November gains in both single- andmultifamily starts show that the overallmarket continues to move forwardrdquo said
NAHB Chairman Tom Woods a homebuilder from Blue Springs Mo ldquoAs buildersanticipate more consumer demand forhousing they should continue to addinventoryrdquo
ldquoSingle-family production this month hasreached levels last seen before the GreatRecession an indicator that we are makinggradual headway back to a normal housingmarketrdquo said NAHB Chief Economist DavidCrowe ldquoAs we close out the year we cansee that the housing sector has madeheadway in 2015 and we expect therecovery to continue at a modest pacerdquo
Combined single- and multifamily startsrose in the South and West with respective
gains of 213 and 63 percent The Midwestwas unchanged and the Northeast fell 85percent
Overall permit issuance rose 11 percentto 1289 million units in NovemberMultifamily permits rose 269 percent to arate of 566000 while single-family permitsincreased 11 percent to 723000 thehighest level since December 2007
Regionally the Midwest South and Westposted respective permit gains of 22percent 56 percent and 217 percentPermit levels in the Northeast held steady
New Home Sales Rise
107 Percent in October983150 Sales of newly built single-family homes
rose 107 percent to a seasonally adjustedannual rate of 495000 units in Octoberaccording to newly released data fromHUD and the US Census Bureau
ldquoOur builders are reporting continuedoptimism in the housing market and areadding inventory in anticipation of futurebusinessrdquo said Tom Woods chairman ofthe National Association of Home Builders(NAHB) and a home builder from BlueSprings Mo
ldquoSales this year are running 157 percentahead of 2014rdquo said NAHB ChiefEconomist David Crowe ldquoWith a firming job market affordable home prices and
rising pent-up demand todayrsquos report isanother indicator that the housing marketcontinues to move on a modest upwardtrajectoryrdquo
New-home sales were up in three out ofthe four regions Sales rose 1353 percentin the Northeast 53 percent in theMidwest and 89 percent in the SouthSales fell 09 percent in the West
The inventory of new homes for sale was226000 units in October This is a 55-month supply at the current sales pace
Builder Confidence EdgesDown One Point983150
Builder confidence in the market fornewly constructed single-family homesremained relatively flat in Decemberdropping one point to 61 on the NationalAssociation of Home BuildersWells FargoHousing Market Index (HMI)
ldquoOverall builders are optimistic about thehousing market although they arereporting concerns with the high price oflots and laborrdquo said NAHB Chairman TomWoods a home builder from Blue SpringsMo
ldquoFor the past seven months builderconfidence levels have averaged in the low60s which is in line with a gradualconsistent recoveryrdquo said NAHB ChiefEconomist David Crowe ldquoWith job creation
economic growth and growing householdformations we anticipate the housingmarket to continue to pick up traction as wehead into 2016rdquo
Derived from a monthly survey thatNAHB has been conducting for 30 yearsthe NAHBWells Fargo Housing MarketIndex gauges builder perceptions of currentsingle-family home sales and salesexpectations for the next six months asgood fair or poor The survey alsoasks builders to rate traffic of prospectivebuyers as high to very high average orlow to very low Scores for eachcomponent are then used to calculate aseasonally adjusted index where anynumber over 50 indicates that morebuilders view conditions as good than poor
All three HMI components postedmodest losses in December The indexmeasuring sales expectations in the nextsix months fell two points to 67 thecomponent gauging current salesconditions decreased one point to 66 andthe index charting buyer traffic dropped twopoints to 46
Looking at the three-month movingaverages for regional HMI scores the Westincreased three points to 76 while theNortheast rose a single point to 50Meanwhile the Midwest dropped two pointsto 58 and the South fell one point to 64
National
Builder News
7212019 Builders Outlook 2015 Issue 12
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Scott Sedam Professional Builder online
Yet for most of usmdashand I suggestfor everyone who has any bent towardprocess improvementmdashonce you havethat piece of knowledge know itsconsequences and are banged overthe head with continual reminders you
just canrsquot let it goEven more difficult is willful
ignorance whereby an individual orcompany makes the choice to ignorewhat Jim Collins termed ldquoObjectiveCurrent Realityrdquo I donrsquot have thetemper I had when I was young andsome now even describe me aspatient but encountering willfulignorance can push me right to theedge Many times I have counseledmdashtalked down in effectmdashyounger builderassociates who decided to ldquoface thebrutal factsrdquo (another Collins saying)on difficult issues while theircolleagues and bosses willfullyrefused I could be the only author inhistory to quote Jim Collins and CatStevens in the same article but duringthese talks Catrsquos old song ldquoFather ampSonrdquo comes to mind with the line ldquoItrsquosnot easy to be calm when yoursquovefound something going onrdquo
This is the sixth in a series of articlesin Professional Builder about processwaste how to identify and understandit and awakening to the reality that themajority of product waste has its roots
in bad process There are hundreds ofexamples of process failure thatseriously impede productivity and profitfor builders suppliers and tradesalike yet there is significant resistanceto tackling process obstacles head onGoing after product waste iscomparatively simple You can see ittouch it measure it test it Processwaste is a far bigger challenge
A Telling ExampleTo illustrate Irsquoll focus on one
example that I first wrote about 15years ago and have touched on manytimes since yet I see precious littleawareness shallow understandingand virtually no change despite theveritable gold mine that awaits thosewho solve it Even worse this issueoften generates fear in seniormanagers when confronted with it andIrsquoll admit I am still trying to work outwhatrsquos behind their reaction
Let me first suggest what theirresponse should be The inarguabledata comes in that there is a minimumof $10K waste per unit in your homeson a single process issue You areprofitable but at 20 percent grossmargin on your $300K units yoursquore notsetting the world on fire That $10Kwould increase your current grossmargin to above 23 percent whichwould make your investors very happyYou are building 100 units annually sothatrsquos a million bucks You should beecstatic but you arenrsquot In fact youdonrsquot even want to engage on this
issue Can you guess what this mightbe
This particular $10K (minimum)thatrsquos buried under every house in theUS and Canada is caused by wastedor otherwise unnecessary trips to thebuilding site I observed thisphenomenon first in my college years
as a loader in a large commerciallumberyard in Ohio I began to noticehow one builder in particular almostnever required extra trips to the sitesfor more materials He got it right thefirst time Three loads and done
That builder was extremely particularabout material species lengths andhow the loads should be stacked Forothers ldquohot shotrdquo runs were a way oflife Forty years later Irsquove learned theaverage lumber company requires fiveto seven additional trips to a sitebeyond what should have originallybeen required had things gone rightfrom the beginning This isnrsquot a roughguess We have had more than 200
lumber and material dealers participatein our LeanWeek sessions withbuilders and we have the data Forthese firms the trips average about$275 each without opportunity cost ahuge bullet that most studies calculateat about 50 percent of the raw cost
Think about this a moment Letrsquostake the average which is six trips ata very low calculation of $250 per triptotaling $1500 Thatrsquos a huge amountof cost that someone has to pay forHow many times do builders go to theirlumber dealers and appeal for a $200or $300 price cut Thatrsquos almostimpossible to get these days
But what if the builder calls thelumber company and suggests ldquoHowabout we work together this year toeliminate four of those six trips and weeach pocket more than $500rdquo Do youthink the lumber company would beinterested I have asked countlessgroups of builder personnel atconferences HBABIA meetingsBuilder 20 Groups etc how manycould show me that they have takenthe initiative to do this I never get a
raised hand Irsquove asked several groupsof lumber companies how many oftheir builders have ever offered Againno one But why Isnrsquot the benefitobvious
The average builder in the US orCanada writes checks to somewherebetween 30 and 60 firms in theprocess of building a house The lownumber is for builders using a lot ofturnkey relationships but 40 is a goodworking number Our data shows thatthe average number of extra trips runsaround 15 per suppliertrade Letrsquos beconservative and say the total numberof excess trips is 50 per house totalWith 4800 suppliers and trades now
having participated in our LeanWeekswe know that the conservative averagecost per trip is $200 Sure there are$50 trips but then there is thefoundation crew that eats up $800 fora single trip before doing any work
A couple of years ago wecommissioned a survey of suppliersand trades and received 497 of 600surveys backmdashan incredible responseWhen we totaled and averaged theircost per trip it came to $201 In short$200 is a solid number and again weare not counting the huge impact oflost opportunity so itrsquos actually quitelow in terms of real effect
Therersquos no denying it More than 50
trips at $200 each accounts for morethan $10K on the average $300Khome Be honest now Have you everreally gone after this If you still havedoubts therersquos one subtlety here thatfinally dawned on us after anelectrician became thoroughlyunplugged during one sessionpassionately explaining that buildersdonrsquot even realize that 80 percent ofthe wasted trips are happening Hedescribed how ldquodry runsrdquo where workcannot be started or a delivery madegenerate a lot of unpleasantcommunication The builder hearsabout it at least at the field level Theinsidious ones he went on are when a
two-day rough requires a third trip tocomplete due to a conflict misseddelivery etc and he and his fellowsuppliers and trades rarely say a word
They are good soldiers They just doit move on and take the hit Thisldquounable to completerdquo applies to virtuallyevery trade far more often thanbuilders ever realize and itrsquos notwithout significant cost
Irsquove asked literally thousands ofsuppliers and trades now whatpercentage of wasted trips do theyever even try to collect a trip chargeTheir answer less than 10 percentSimilarly I ask purchasing whatpercentage of the extra trip chargeinvoices that they see are approvedand paid by the builder They alsoanswer less than 10 percent Ponderthat This means builders actually payfor less than 1 percent of the wastedtrips to building sites The suppliersand trades eat this $10K on every oneof your homes or rather bury it in theiroverhead No matter the costs arethere
6 Builders Outlook 2 15 issue 12
Industry
Perspective
Process Failure
Product Waste In Home Building
Sometimes lifemdashand workmdashwould be easier if you could forget
some things yoursquove learned Blissful ignorance has its appeal not
just for individuals but for companies schools churches
governments and organizations of all kinds Just keep on doing
what yoursquore doing even if itrsquos not working so well Blame the
suppliers blame the trades blame your people blame the other
builders blame the market blame the press and blame the
government at every level No worries you have a long road to
travel before you get to blaming yourself
7212019 Builders Outlook 2015 Issue 12
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7 15 ISSUE 12 Builders Outlook
Time To Pay Up
So who ultimately pays Is this atthe heart of why builders avoidconfronting this critical process issue
Irsquove had several builders actually getangry with me for generatingawareness of the problem Theirconcern is they will suddenly get hitwith all sorts of trip charges It is truethat so many suppliers and trades out
there have eaten these costs for solong that they just think thatrsquos the wayhome building is and never try tocollect So is that an answer Keepthem in the dark and hope they remainunaware Do that if you are contentwith lower profit for you yoursuppliers and your trades
Right now there is no greater issueaffecting builder profitability in the USthan trade shortages It matters notwhere you live everyone thinks theyare the worst in the country Imaginefor a moment if you worked with yoursuppliers and trades in earnest andover the next couple of yearseliminated 80 percent of those extra
trips totaling $8K of cost What wouldhappen They would immediately getmore profitable at the same bid pricethey are getting now Several resultsaccrue First they will put you at thetop of their list because you haveclearly demonstrated you care abouttheir success Second they can bidyou more closely now knowing theywonrsquot have extra costs to bear Thirdyoursquoll get their best crews and nothingkeeps you on schedule and ensuresquality better than having the bestcrews Finally even beyond thosethree important factors you will makea lot more money To get it thoughyoursquoll have to make some changes
1 Why do our suppliers and tradeshave to make extra trips tobuilding sites that kill the scheduleand cost them money Becausewe lack complete detail on plansoptions and specifications
2 Why Because purchasing is sofar behind
3 Why Because we never givepurchasing enough time andinformation to get bids contractsand scopes done before a newproject opens
4 Why Because Product
Development is always behind
5 Why Because seniormanagement keeps changing theproduct
If a builder figured out what theywere going to build and stuck with itproduct development had plansspecifications and options determinedon time and purchasing had all theinformation it needed for 100 percentcomplete bid packages and startpackages would you reduce extratrips Would you make more moneyWould they make more money Thatcould go in many directions For
example in another company the rootmay be that Sales accepts too manylate or custom change orders In stillanother company it may be abreakdown in the POVPO system Instill another it could be poorscheduling practices No matter whatthe source this is a way to reducecost and stay on schedule
So donrsquot be afraid to make multipleiterations of the 5 Whys If you needsix or seven questions to get to theheart of the matter then do it In thefirst example above I would ask Whydoes senior management keepchanging the product It could bebecause they bought the land wrong
and what they had in mind originallywasnrsquot working Or because two newcompetitors opened down the road atthe identical price point Or it could
just be that the management teamcanrsquot ever make a decision and stickwith it
Compare that to dealing with aproduct issue such as whether toswitch from Siding A to Siding B or goto a higher level of carpet pad orchange the pitch of a roof Thatrsquos easyProcess resolution is far morecomplex and messy Any builder whostrongly commits to eliminating wastedtrips unavoidably commits to doing awhole lot of other things right and
thatrsquos why we know the money isthere I could have made this entirepoint with other processes but thewasted trip problem is the hardest todeal with that Irsquove encountered Thereis genuine fear in opening up tosuppliers and trades and admittingthat your process failures are hurtingtheir bottom line There is fear that ifyou blow it all yoursquoll get is a constantstream of trip charges leading tohigher cost There is fear that you willnever actually see the money yousave them All that fear adds up to abig mental roadblock That results inmaintaining business as usual andgoing the traditional route of trying to
negotiate lower cost In this market Iwish you luck
Will you allow fear to keep your backturned to this critical issue Will fearkeep you from facing the brutal factsof this and other process failures Ifear you will I hope you will not PB
---Scott Sedam is president of
TrueNorth Development For the latest PDF in this series ldquoBridging the Margin Gaprdquo send a request via email to infotruencom and include ldquoMargin Gaprdquo in the subject line
Make It HappenGet a team of your strongest people together from all parts of the companymdashnot justconstruction and estimatingmdashand brainstorm a list of everything yoursquod have to do toeliminate these extra trips The age-old Lean Six Sigma technique ldquoThe 5 Whysrdquo is perfect toget you started Letrsquos try it
7212019 Builders Outlook 2015 Issue 12
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Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
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wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
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ersonal andP
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oansortgage
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ay Online Bill P
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one - aso015 N Mesa
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one - aso068 Gateway East
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Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
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Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
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HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
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7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
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GINDILB
El P
soSIN 0951E
5 15 issue 12 Builders Outlook
Single-Family Starts ReachSeven-Year High983150 Nationwide housing starts rose 105
percent to a seasonally adjusted annualrate of 1173 million units in Novemberaccording to newly released data from theUS Department of Housing and UrbanDevelopment and the CommerceDepartment Single-family productionincreased 76 percent to a seasonallyadjusted annual rate of 768000 units itshighest reading since January 2008Multifamily production rose 164 percent to405000 units
ldquoThe November gains in both single- andmultifamily starts show that the overallmarket continues to move forwardrdquo said
NAHB Chairman Tom Woods a homebuilder from Blue Springs Mo ldquoAs buildersanticipate more consumer demand forhousing they should continue to addinventoryrdquo
ldquoSingle-family production this month hasreached levels last seen before the GreatRecession an indicator that we are makinggradual headway back to a normal housingmarketrdquo said NAHB Chief Economist DavidCrowe ldquoAs we close out the year we cansee that the housing sector has madeheadway in 2015 and we expect therecovery to continue at a modest pacerdquo
Combined single- and multifamily startsrose in the South and West with respective
gains of 213 and 63 percent The Midwestwas unchanged and the Northeast fell 85percent
Overall permit issuance rose 11 percentto 1289 million units in NovemberMultifamily permits rose 269 percent to arate of 566000 while single-family permitsincreased 11 percent to 723000 thehighest level since December 2007
Regionally the Midwest South and Westposted respective permit gains of 22percent 56 percent and 217 percentPermit levels in the Northeast held steady
New Home Sales Rise
107 Percent in October983150 Sales of newly built single-family homes
rose 107 percent to a seasonally adjustedannual rate of 495000 units in Octoberaccording to newly released data fromHUD and the US Census Bureau
ldquoOur builders are reporting continuedoptimism in the housing market and areadding inventory in anticipation of futurebusinessrdquo said Tom Woods chairman ofthe National Association of Home Builders(NAHB) and a home builder from BlueSprings Mo
ldquoSales this year are running 157 percentahead of 2014rdquo said NAHB ChiefEconomist David Crowe ldquoWith a firming job market affordable home prices and
rising pent-up demand todayrsquos report isanother indicator that the housing marketcontinues to move on a modest upwardtrajectoryrdquo
New-home sales were up in three out ofthe four regions Sales rose 1353 percentin the Northeast 53 percent in theMidwest and 89 percent in the SouthSales fell 09 percent in the West
The inventory of new homes for sale was226000 units in October This is a 55-month supply at the current sales pace
Builder Confidence EdgesDown One Point983150
Builder confidence in the market fornewly constructed single-family homesremained relatively flat in Decemberdropping one point to 61 on the NationalAssociation of Home BuildersWells FargoHousing Market Index (HMI)
ldquoOverall builders are optimistic about thehousing market although they arereporting concerns with the high price oflots and laborrdquo said NAHB Chairman TomWoods a home builder from Blue SpringsMo
ldquoFor the past seven months builderconfidence levels have averaged in the low60s which is in line with a gradualconsistent recoveryrdquo said NAHB ChiefEconomist David Crowe ldquoWith job creation
economic growth and growing householdformations we anticipate the housingmarket to continue to pick up traction as wehead into 2016rdquo
Derived from a monthly survey thatNAHB has been conducting for 30 yearsthe NAHBWells Fargo Housing MarketIndex gauges builder perceptions of currentsingle-family home sales and salesexpectations for the next six months asgood fair or poor The survey alsoasks builders to rate traffic of prospectivebuyers as high to very high average orlow to very low Scores for eachcomponent are then used to calculate aseasonally adjusted index where anynumber over 50 indicates that morebuilders view conditions as good than poor
All three HMI components postedmodest losses in December The indexmeasuring sales expectations in the nextsix months fell two points to 67 thecomponent gauging current salesconditions decreased one point to 66 andthe index charting buyer traffic dropped twopoints to 46
Looking at the three-month movingaverages for regional HMI scores the Westincreased three points to 76 while theNortheast rose a single point to 50Meanwhile the Midwest dropped two pointsto 58 and the South fell one point to 64
National
Builder News
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 616
Scott Sedam Professional Builder online
Yet for most of usmdashand I suggestfor everyone who has any bent towardprocess improvementmdashonce you havethat piece of knowledge know itsconsequences and are banged overthe head with continual reminders you
just canrsquot let it goEven more difficult is willful
ignorance whereby an individual orcompany makes the choice to ignorewhat Jim Collins termed ldquoObjectiveCurrent Realityrdquo I donrsquot have thetemper I had when I was young andsome now even describe me aspatient but encountering willfulignorance can push me right to theedge Many times I have counseledmdashtalked down in effectmdashyounger builderassociates who decided to ldquoface thebrutal factsrdquo (another Collins saying)on difficult issues while theircolleagues and bosses willfullyrefused I could be the only author inhistory to quote Jim Collins and CatStevens in the same article but duringthese talks Catrsquos old song ldquoFather ampSonrdquo comes to mind with the line ldquoItrsquosnot easy to be calm when yoursquovefound something going onrdquo
This is the sixth in a series of articlesin Professional Builder about processwaste how to identify and understandit and awakening to the reality that themajority of product waste has its roots
in bad process There are hundreds ofexamples of process failure thatseriously impede productivity and profitfor builders suppliers and tradesalike yet there is significant resistanceto tackling process obstacles head onGoing after product waste iscomparatively simple You can see ittouch it measure it test it Processwaste is a far bigger challenge
A Telling ExampleTo illustrate Irsquoll focus on one
example that I first wrote about 15years ago and have touched on manytimes since yet I see precious littleawareness shallow understandingand virtually no change despite theveritable gold mine that awaits thosewho solve it Even worse this issueoften generates fear in seniormanagers when confronted with it andIrsquoll admit I am still trying to work outwhatrsquos behind their reaction
Let me first suggest what theirresponse should be The inarguabledata comes in that there is a minimumof $10K waste per unit in your homeson a single process issue You areprofitable but at 20 percent grossmargin on your $300K units yoursquore notsetting the world on fire That $10Kwould increase your current grossmargin to above 23 percent whichwould make your investors very happyYou are building 100 units annually sothatrsquos a million bucks You should beecstatic but you arenrsquot In fact youdonrsquot even want to engage on this
issue Can you guess what this mightbe
This particular $10K (minimum)thatrsquos buried under every house in theUS and Canada is caused by wastedor otherwise unnecessary trips to thebuilding site I observed thisphenomenon first in my college years
as a loader in a large commerciallumberyard in Ohio I began to noticehow one builder in particular almostnever required extra trips to the sitesfor more materials He got it right thefirst time Three loads and done
That builder was extremely particularabout material species lengths andhow the loads should be stacked Forothers ldquohot shotrdquo runs were a way oflife Forty years later Irsquove learned theaverage lumber company requires fiveto seven additional trips to a sitebeyond what should have originallybeen required had things gone rightfrom the beginning This isnrsquot a roughguess We have had more than 200
lumber and material dealers participatein our LeanWeek sessions withbuilders and we have the data Forthese firms the trips average about$275 each without opportunity cost ahuge bullet that most studies calculateat about 50 percent of the raw cost
Think about this a moment Letrsquostake the average which is six trips ata very low calculation of $250 per triptotaling $1500 Thatrsquos a huge amountof cost that someone has to pay forHow many times do builders go to theirlumber dealers and appeal for a $200or $300 price cut Thatrsquos almostimpossible to get these days
But what if the builder calls thelumber company and suggests ldquoHowabout we work together this year toeliminate four of those six trips and weeach pocket more than $500rdquo Do youthink the lumber company would beinterested I have asked countlessgroups of builder personnel atconferences HBABIA meetingsBuilder 20 Groups etc how manycould show me that they have takenthe initiative to do this I never get a
raised hand Irsquove asked several groupsof lumber companies how many oftheir builders have ever offered Againno one But why Isnrsquot the benefitobvious
The average builder in the US orCanada writes checks to somewherebetween 30 and 60 firms in theprocess of building a house The lownumber is for builders using a lot ofturnkey relationships but 40 is a goodworking number Our data shows thatthe average number of extra trips runsaround 15 per suppliertrade Letrsquos beconservative and say the total numberof excess trips is 50 per house totalWith 4800 suppliers and trades now
having participated in our LeanWeekswe know that the conservative averagecost per trip is $200 Sure there are$50 trips but then there is thefoundation crew that eats up $800 fora single trip before doing any work
A couple of years ago wecommissioned a survey of suppliersand trades and received 497 of 600surveys backmdashan incredible responseWhen we totaled and averaged theircost per trip it came to $201 In short$200 is a solid number and again weare not counting the huge impact oflost opportunity so itrsquos actually quitelow in terms of real effect
Therersquos no denying it More than 50
trips at $200 each accounts for morethan $10K on the average $300Khome Be honest now Have you everreally gone after this If you still havedoubts therersquos one subtlety here thatfinally dawned on us after anelectrician became thoroughlyunplugged during one sessionpassionately explaining that buildersdonrsquot even realize that 80 percent ofthe wasted trips are happening Hedescribed how ldquodry runsrdquo where workcannot be started or a delivery madegenerate a lot of unpleasantcommunication The builder hearsabout it at least at the field level Theinsidious ones he went on are when a
two-day rough requires a third trip tocomplete due to a conflict misseddelivery etc and he and his fellowsuppliers and trades rarely say a word
They are good soldiers They just doit move on and take the hit Thisldquounable to completerdquo applies to virtuallyevery trade far more often thanbuilders ever realize and itrsquos notwithout significant cost
Irsquove asked literally thousands ofsuppliers and trades now whatpercentage of wasted trips do theyever even try to collect a trip chargeTheir answer less than 10 percentSimilarly I ask purchasing whatpercentage of the extra trip chargeinvoices that they see are approvedand paid by the builder They alsoanswer less than 10 percent Ponderthat This means builders actually payfor less than 1 percent of the wastedtrips to building sites The suppliersand trades eat this $10K on every oneof your homes or rather bury it in theiroverhead No matter the costs arethere
6 Builders Outlook 2 15 issue 12
Industry
Perspective
Process Failure
Product Waste In Home Building
Sometimes lifemdashand workmdashwould be easier if you could forget
some things yoursquove learned Blissful ignorance has its appeal not
just for individuals but for companies schools churches
governments and organizations of all kinds Just keep on doing
what yoursquore doing even if itrsquos not working so well Blame the
suppliers blame the trades blame your people blame the other
builders blame the market blame the press and blame the
government at every level No worries you have a long road to
travel before you get to blaming yourself
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 716
7 15 ISSUE 12 Builders Outlook
Time To Pay Up
So who ultimately pays Is this atthe heart of why builders avoidconfronting this critical process issue
Irsquove had several builders actually getangry with me for generatingawareness of the problem Theirconcern is they will suddenly get hitwith all sorts of trip charges It is truethat so many suppliers and trades out
there have eaten these costs for solong that they just think thatrsquos the wayhome building is and never try tocollect So is that an answer Keepthem in the dark and hope they remainunaware Do that if you are contentwith lower profit for you yoursuppliers and your trades
Right now there is no greater issueaffecting builder profitability in the USthan trade shortages It matters notwhere you live everyone thinks theyare the worst in the country Imaginefor a moment if you worked with yoursuppliers and trades in earnest andover the next couple of yearseliminated 80 percent of those extra
trips totaling $8K of cost What wouldhappen They would immediately getmore profitable at the same bid pricethey are getting now Several resultsaccrue First they will put you at thetop of their list because you haveclearly demonstrated you care abouttheir success Second they can bidyou more closely now knowing theywonrsquot have extra costs to bear Thirdyoursquoll get their best crews and nothingkeeps you on schedule and ensuresquality better than having the bestcrews Finally even beyond thosethree important factors you will makea lot more money To get it thoughyoursquoll have to make some changes
1 Why do our suppliers and tradeshave to make extra trips tobuilding sites that kill the scheduleand cost them money Becausewe lack complete detail on plansoptions and specifications
2 Why Because purchasing is sofar behind
3 Why Because we never givepurchasing enough time andinformation to get bids contractsand scopes done before a newproject opens
4 Why Because Product
Development is always behind
5 Why Because seniormanagement keeps changing theproduct
If a builder figured out what theywere going to build and stuck with itproduct development had plansspecifications and options determinedon time and purchasing had all theinformation it needed for 100 percentcomplete bid packages and startpackages would you reduce extratrips Would you make more moneyWould they make more money Thatcould go in many directions For
example in another company the rootmay be that Sales accepts too manylate or custom change orders In stillanother company it may be abreakdown in the POVPO system Instill another it could be poorscheduling practices No matter whatthe source this is a way to reducecost and stay on schedule
So donrsquot be afraid to make multipleiterations of the 5 Whys If you needsix or seven questions to get to theheart of the matter then do it In thefirst example above I would ask Whydoes senior management keepchanging the product It could bebecause they bought the land wrong
and what they had in mind originallywasnrsquot working Or because two newcompetitors opened down the road atthe identical price point Or it could
just be that the management teamcanrsquot ever make a decision and stickwith it
Compare that to dealing with aproduct issue such as whether toswitch from Siding A to Siding B or goto a higher level of carpet pad orchange the pitch of a roof Thatrsquos easyProcess resolution is far morecomplex and messy Any builder whostrongly commits to eliminating wastedtrips unavoidably commits to doing awhole lot of other things right and
thatrsquos why we know the money isthere I could have made this entirepoint with other processes but thewasted trip problem is the hardest todeal with that Irsquove encountered Thereis genuine fear in opening up tosuppliers and trades and admittingthat your process failures are hurtingtheir bottom line There is fear that ifyou blow it all yoursquoll get is a constantstream of trip charges leading tohigher cost There is fear that you willnever actually see the money yousave them All that fear adds up to abig mental roadblock That results inmaintaining business as usual andgoing the traditional route of trying to
negotiate lower cost In this market Iwish you luck
Will you allow fear to keep your backturned to this critical issue Will fearkeep you from facing the brutal factsof this and other process failures Ifear you will I hope you will not PB
---Scott Sedam is president of
TrueNorth Development For the latest PDF in this series ldquoBridging the Margin Gaprdquo send a request via email to infotruencom and include ldquoMargin Gaprdquo in the subject line
Make It HappenGet a team of your strongest people together from all parts of the companymdashnot justconstruction and estimatingmdashand brainstorm a list of everything yoursquod have to do toeliminate these extra trips The age-old Lean Six Sigma technique ldquoThe 5 Whysrdquo is perfect toget you started Letrsquos try it
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 816
Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
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ay Online Bill P
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
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HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
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7212019 Builders Outlook 2015 Issue 12
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13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
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JANUARY 19-21
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7212019 Builders Outlook 2015 Issue 12
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The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
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7212019 Builders Outlook 2015 Issue 12
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7212019 Builders Outlook 2015 Issue 12
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Scott Sedam Professional Builder online
Yet for most of usmdashand I suggestfor everyone who has any bent towardprocess improvementmdashonce you havethat piece of knowledge know itsconsequences and are banged overthe head with continual reminders you
just canrsquot let it goEven more difficult is willful
ignorance whereby an individual orcompany makes the choice to ignorewhat Jim Collins termed ldquoObjectiveCurrent Realityrdquo I donrsquot have thetemper I had when I was young andsome now even describe me aspatient but encountering willfulignorance can push me right to theedge Many times I have counseledmdashtalked down in effectmdashyounger builderassociates who decided to ldquoface thebrutal factsrdquo (another Collins saying)on difficult issues while theircolleagues and bosses willfullyrefused I could be the only author inhistory to quote Jim Collins and CatStevens in the same article but duringthese talks Catrsquos old song ldquoFather ampSonrdquo comes to mind with the line ldquoItrsquosnot easy to be calm when yoursquovefound something going onrdquo
This is the sixth in a series of articlesin Professional Builder about processwaste how to identify and understandit and awakening to the reality that themajority of product waste has its roots
in bad process There are hundreds ofexamples of process failure thatseriously impede productivity and profitfor builders suppliers and tradesalike yet there is significant resistanceto tackling process obstacles head onGoing after product waste iscomparatively simple You can see ittouch it measure it test it Processwaste is a far bigger challenge
A Telling ExampleTo illustrate Irsquoll focus on one
example that I first wrote about 15years ago and have touched on manytimes since yet I see precious littleawareness shallow understandingand virtually no change despite theveritable gold mine that awaits thosewho solve it Even worse this issueoften generates fear in seniormanagers when confronted with it andIrsquoll admit I am still trying to work outwhatrsquos behind their reaction
Let me first suggest what theirresponse should be The inarguabledata comes in that there is a minimumof $10K waste per unit in your homeson a single process issue You areprofitable but at 20 percent grossmargin on your $300K units yoursquore notsetting the world on fire That $10Kwould increase your current grossmargin to above 23 percent whichwould make your investors very happyYou are building 100 units annually sothatrsquos a million bucks You should beecstatic but you arenrsquot In fact youdonrsquot even want to engage on this
issue Can you guess what this mightbe
This particular $10K (minimum)thatrsquos buried under every house in theUS and Canada is caused by wastedor otherwise unnecessary trips to thebuilding site I observed thisphenomenon first in my college years
as a loader in a large commerciallumberyard in Ohio I began to noticehow one builder in particular almostnever required extra trips to the sitesfor more materials He got it right thefirst time Three loads and done
That builder was extremely particularabout material species lengths andhow the loads should be stacked Forothers ldquohot shotrdquo runs were a way oflife Forty years later Irsquove learned theaverage lumber company requires fiveto seven additional trips to a sitebeyond what should have originallybeen required had things gone rightfrom the beginning This isnrsquot a roughguess We have had more than 200
lumber and material dealers participatein our LeanWeek sessions withbuilders and we have the data Forthese firms the trips average about$275 each without opportunity cost ahuge bullet that most studies calculateat about 50 percent of the raw cost
Think about this a moment Letrsquostake the average which is six trips ata very low calculation of $250 per triptotaling $1500 Thatrsquos a huge amountof cost that someone has to pay forHow many times do builders go to theirlumber dealers and appeal for a $200or $300 price cut Thatrsquos almostimpossible to get these days
But what if the builder calls thelumber company and suggests ldquoHowabout we work together this year toeliminate four of those six trips and weeach pocket more than $500rdquo Do youthink the lumber company would beinterested I have asked countlessgroups of builder personnel atconferences HBABIA meetingsBuilder 20 Groups etc how manycould show me that they have takenthe initiative to do this I never get a
raised hand Irsquove asked several groupsof lumber companies how many oftheir builders have ever offered Againno one But why Isnrsquot the benefitobvious
The average builder in the US orCanada writes checks to somewherebetween 30 and 60 firms in theprocess of building a house The lownumber is for builders using a lot ofturnkey relationships but 40 is a goodworking number Our data shows thatthe average number of extra trips runsaround 15 per suppliertrade Letrsquos beconservative and say the total numberof excess trips is 50 per house totalWith 4800 suppliers and trades now
having participated in our LeanWeekswe know that the conservative averagecost per trip is $200 Sure there are$50 trips but then there is thefoundation crew that eats up $800 fora single trip before doing any work
A couple of years ago wecommissioned a survey of suppliersand trades and received 497 of 600surveys backmdashan incredible responseWhen we totaled and averaged theircost per trip it came to $201 In short$200 is a solid number and again weare not counting the huge impact oflost opportunity so itrsquos actually quitelow in terms of real effect
Therersquos no denying it More than 50
trips at $200 each accounts for morethan $10K on the average $300Khome Be honest now Have you everreally gone after this If you still havedoubts therersquos one subtlety here thatfinally dawned on us after anelectrician became thoroughlyunplugged during one sessionpassionately explaining that buildersdonrsquot even realize that 80 percent ofthe wasted trips are happening Hedescribed how ldquodry runsrdquo where workcannot be started or a delivery madegenerate a lot of unpleasantcommunication The builder hearsabout it at least at the field level Theinsidious ones he went on are when a
two-day rough requires a third trip tocomplete due to a conflict misseddelivery etc and he and his fellowsuppliers and trades rarely say a word
They are good soldiers They just doit move on and take the hit Thisldquounable to completerdquo applies to virtuallyevery trade far more often thanbuilders ever realize and itrsquos notwithout significant cost
Irsquove asked literally thousands ofsuppliers and trades now whatpercentage of wasted trips do theyever even try to collect a trip chargeTheir answer less than 10 percentSimilarly I ask purchasing whatpercentage of the extra trip chargeinvoices that they see are approvedand paid by the builder They alsoanswer less than 10 percent Ponderthat This means builders actually payfor less than 1 percent of the wastedtrips to building sites The suppliersand trades eat this $10K on every oneof your homes or rather bury it in theiroverhead No matter the costs arethere
6 Builders Outlook 2 15 issue 12
Industry
Perspective
Process Failure
Product Waste In Home Building
Sometimes lifemdashand workmdashwould be easier if you could forget
some things yoursquove learned Blissful ignorance has its appeal not
just for individuals but for companies schools churches
governments and organizations of all kinds Just keep on doing
what yoursquore doing even if itrsquos not working so well Blame the
suppliers blame the trades blame your people blame the other
builders blame the market blame the press and blame the
government at every level No worries you have a long road to
travel before you get to blaming yourself
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 716
7 15 ISSUE 12 Builders Outlook
Time To Pay Up
So who ultimately pays Is this atthe heart of why builders avoidconfronting this critical process issue
Irsquove had several builders actually getangry with me for generatingawareness of the problem Theirconcern is they will suddenly get hitwith all sorts of trip charges It is truethat so many suppliers and trades out
there have eaten these costs for solong that they just think thatrsquos the wayhome building is and never try tocollect So is that an answer Keepthem in the dark and hope they remainunaware Do that if you are contentwith lower profit for you yoursuppliers and your trades
Right now there is no greater issueaffecting builder profitability in the USthan trade shortages It matters notwhere you live everyone thinks theyare the worst in the country Imaginefor a moment if you worked with yoursuppliers and trades in earnest andover the next couple of yearseliminated 80 percent of those extra
trips totaling $8K of cost What wouldhappen They would immediately getmore profitable at the same bid pricethey are getting now Several resultsaccrue First they will put you at thetop of their list because you haveclearly demonstrated you care abouttheir success Second they can bidyou more closely now knowing theywonrsquot have extra costs to bear Thirdyoursquoll get their best crews and nothingkeeps you on schedule and ensuresquality better than having the bestcrews Finally even beyond thosethree important factors you will makea lot more money To get it thoughyoursquoll have to make some changes
1 Why do our suppliers and tradeshave to make extra trips tobuilding sites that kill the scheduleand cost them money Becausewe lack complete detail on plansoptions and specifications
2 Why Because purchasing is sofar behind
3 Why Because we never givepurchasing enough time andinformation to get bids contractsand scopes done before a newproject opens
4 Why Because Product
Development is always behind
5 Why Because seniormanagement keeps changing theproduct
If a builder figured out what theywere going to build and stuck with itproduct development had plansspecifications and options determinedon time and purchasing had all theinformation it needed for 100 percentcomplete bid packages and startpackages would you reduce extratrips Would you make more moneyWould they make more money Thatcould go in many directions For
example in another company the rootmay be that Sales accepts too manylate or custom change orders In stillanother company it may be abreakdown in the POVPO system Instill another it could be poorscheduling practices No matter whatthe source this is a way to reducecost and stay on schedule
So donrsquot be afraid to make multipleiterations of the 5 Whys If you needsix or seven questions to get to theheart of the matter then do it In thefirst example above I would ask Whydoes senior management keepchanging the product It could bebecause they bought the land wrong
and what they had in mind originallywasnrsquot working Or because two newcompetitors opened down the road atthe identical price point Or it could
just be that the management teamcanrsquot ever make a decision and stickwith it
Compare that to dealing with aproduct issue such as whether toswitch from Siding A to Siding B or goto a higher level of carpet pad orchange the pitch of a roof Thatrsquos easyProcess resolution is far morecomplex and messy Any builder whostrongly commits to eliminating wastedtrips unavoidably commits to doing awhole lot of other things right and
thatrsquos why we know the money isthere I could have made this entirepoint with other processes but thewasted trip problem is the hardest todeal with that Irsquove encountered Thereis genuine fear in opening up tosuppliers and trades and admittingthat your process failures are hurtingtheir bottom line There is fear that ifyou blow it all yoursquoll get is a constantstream of trip charges leading tohigher cost There is fear that you willnever actually see the money yousave them All that fear adds up to abig mental roadblock That results inmaintaining business as usual andgoing the traditional route of trying to
negotiate lower cost In this market Iwish you luck
Will you allow fear to keep your backturned to this critical issue Will fearkeep you from facing the brutal factsof this and other process failures Ifear you will I hope you will not PB
---Scott Sedam is president of
TrueNorth Development For the latest PDF in this series ldquoBridging the Margin Gaprdquo send a request via email to infotruencom and include ldquoMargin Gaprdquo in the subject line
Make It HappenGet a team of your strongest people together from all parts of the companymdashnot justconstruction and estimatingmdashand brainstorm a list of everything yoursquod have to do toeliminate these extra trips The age-old Lean Six Sigma technique ldquoThe 5 Whysrdquo is perfect toget you started Letrsquos try it
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 816
Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 916
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
Pioneer Bank understands
nancesabout
spen ess me
offer products t
moreand
worry ng
help you
n o r en w
your finBusine lWhencommuPionee
t new
ancial needs we provides or personal whatever
we growyou grow
n y an s nceyourbeenhasBankr
eas s nce
oans
Commercial L
ersonal andP
Savings
usness ec ng
FREE Checking
provideun erstonlinethese a l lland cr
solutio
in bank
l
s the latest innovationsan s your nee s an
Pioneer BankyBill P nd additional bills from
edit card mdash then pay l
s to help you succeed
in
oansortgage
R
ay Online Bill P
tatementseS
Banking
Internet amp Mobile
Merchant Services
emote De osit
one - aso015 N Mesa
S
R e s l e r D
r
S
R
e s l e
r D
r
N M e s a S t
N M e s a S t
N
one - aso068 Gateway East
ona
2290
N
Gat ew ay E as t
Tra
e - o
Trawood
for more detailsee an represenepending on acco250000 Services
s insured by FDICo open aN
L e e
T r evi n o
Dr
L e e
T r evi n o
Dr
wood Dr
a ve unt
varyup toc accoun
p
oneer
n
Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
ldquoArdquo ra ted ca rriers sev eral a vailable
overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
Ex rcial eneral Contractors
rcial Umbrella
w wwbuilderagentnetworkcomww whubinternat ionalcom
El Paso Permian Basin and Surrounding Area
HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
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industry leader at the 2016 NAHB International Buildersrsquo Showreg
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
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Connect to the El Paso
Association of Builders
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
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7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 716
7 15 ISSUE 12 Builders Outlook
Time To Pay Up
So who ultimately pays Is this atthe heart of why builders avoidconfronting this critical process issue
Irsquove had several builders actually getangry with me for generatingawareness of the problem Theirconcern is they will suddenly get hitwith all sorts of trip charges It is truethat so many suppliers and trades out
there have eaten these costs for solong that they just think thatrsquos the wayhome building is and never try tocollect So is that an answer Keepthem in the dark and hope they remainunaware Do that if you are contentwith lower profit for you yoursuppliers and your trades
Right now there is no greater issueaffecting builder profitability in the USthan trade shortages It matters notwhere you live everyone thinks theyare the worst in the country Imaginefor a moment if you worked with yoursuppliers and trades in earnest andover the next couple of yearseliminated 80 percent of those extra
trips totaling $8K of cost What wouldhappen They would immediately getmore profitable at the same bid pricethey are getting now Several resultsaccrue First they will put you at thetop of their list because you haveclearly demonstrated you care abouttheir success Second they can bidyou more closely now knowing theywonrsquot have extra costs to bear Thirdyoursquoll get their best crews and nothingkeeps you on schedule and ensuresquality better than having the bestcrews Finally even beyond thosethree important factors you will makea lot more money To get it thoughyoursquoll have to make some changes
1 Why do our suppliers and tradeshave to make extra trips tobuilding sites that kill the scheduleand cost them money Becausewe lack complete detail on plansoptions and specifications
2 Why Because purchasing is sofar behind
3 Why Because we never givepurchasing enough time andinformation to get bids contractsand scopes done before a newproject opens
4 Why Because Product
Development is always behind
5 Why Because seniormanagement keeps changing theproduct
If a builder figured out what theywere going to build and stuck with itproduct development had plansspecifications and options determinedon time and purchasing had all theinformation it needed for 100 percentcomplete bid packages and startpackages would you reduce extratrips Would you make more moneyWould they make more money Thatcould go in many directions For
example in another company the rootmay be that Sales accepts too manylate or custom change orders In stillanother company it may be abreakdown in the POVPO system Instill another it could be poorscheduling practices No matter whatthe source this is a way to reducecost and stay on schedule
So donrsquot be afraid to make multipleiterations of the 5 Whys If you needsix or seven questions to get to theheart of the matter then do it In thefirst example above I would ask Whydoes senior management keepchanging the product It could bebecause they bought the land wrong
and what they had in mind originallywasnrsquot working Or because two newcompetitors opened down the road atthe identical price point Or it could
just be that the management teamcanrsquot ever make a decision and stickwith it
Compare that to dealing with aproduct issue such as whether toswitch from Siding A to Siding B or goto a higher level of carpet pad orchange the pitch of a roof Thatrsquos easyProcess resolution is far morecomplex and messy Any builder whostrongly commits to eliminating wastedtrips unavoidably commits to doing awhole lot of other things right and
thatrsquos why we know the money isthere I could have made this entirepoint with other processes but thewasted trip problem is the hardest todeal with that Irsquove encountered Thereis genuine fear in opening up tosuppliers and trades and admittingthat your process failures are hurtingtheir bottom line There is fear that ifyou blow it all yoursquoll get is a constantstream of trip charges leading tohigher cost There is fear that you willnever actually see the money yousave them All that fear adds up to abig mental roadblock That results inmaintaining business as usual andgoing the traditional route of trying to
negotiate lower cost In this market Iwish you luck
Will you allow fear to keep your backturned to this critical issue Will fearkeep you from facing the brutal factsof this and other process failures Ifear you will I hope you will not PB
---Scott Sedam is president of
TrueNorth Development For the latest PDF in this series ldquoBridging the Margin Gaprdquo send a request via email to infotruencom and include ldquoMargin Gaprdquo in the subject line
Make It HappenGet a team of your strongest people together from all parts of the companymdashnot justconstruction and estimatingmdashand brainstorm a list of everything yoursquod have to do toeliminate these extra trips The age-old Lean Six Sigma technique ldquoThe 5 Whysrdquo is perfect toget you started Letrsquos try it
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 816
Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 916
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
Pioneer Bank understands
nancesabout
spen ess me
offer products t
moreand
worry ng
help you
n o r en w
your finBusine lWhencommuPionee
t new
ancial needs we provides or personal whatever
we growyou grow
n y an s nceyourbeenhasBankr
eas s nce
oans
Commercial L
ersonal andP
Savings
usness ec ng
FREE Checking
provideun erstonlinethese a l lland cr
solutio
in bank
l
s the latest innovationsan s your nee s an
Pioneer BankyBill P nd additional bills from
edit card mdash then pay l
s to help you succeed
in
oansortgage
R
ay Online Bill P
tatementseS
Banking
Internet amp Mobile
Merchant Services
emote De osit
one - aso015 N Mesa
S
R e s l e r D
r
S
R
e s l e
r D
r
N M e s a S t
N M e s a S t
N
one - aso068 Gateway East
ona
2290
N
Gat ew ay E as t
Tra
e - o
Trawood
for more detailsee an represenepending on acco250000 Services
s insured by FDICo open aN
L e e
T r evi n o
Dr
L e e
T r evi n o
Dr
wood Dr
a ve unt
varyup toc accoun
p
oneer
n
Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
ldquoArdquo ra ted ca rriers sev eral a vailable
overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
Ex rcial eneral Contractors
rcial Umbrella
w wwbuilderagentnetworkcomww whubinternat ionalcom
El Paso Permian Basin and Surrounding Area
HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
NAHB MEMBERS GET EXCLUSIVE REGISTRATION DISCOUNTS
BuildersShowcom
AD1316
Invest in your future and get the tools you need to become an
industry leader at the 2016 NAHB International Buildersrsquo Showreg
(IBS) Learn from some of the industryrsquos best speakers see live
construction demos by leading experts and explore top manufacturers
and suppliersndashall at the building industryrsquos biggest event You just
canrsquot beat this incredible value
IBSVEGAS
IMPROVE YOUR BUSINESS IN JUST 3 DAYS AT IBS 2016
ibs 2016DISCOVER THE BUILDING UNIVERSE
january 19-21 Las Vegas
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
HOMES
Connect to the El Paso
Association of Builders
wwwelpasobuilderscom
innovative design
ampdesktop publishing
since 1984
ted escobedotedsnappypublishingbull com
talk amp text 915bull 820bull 2800
Get Creative Make it Snappy
Make your travel
arrangements now for
the 2016 International
Builders Show in
Las Vegas
Jan 19-21
brought to you by
Search No More The Associaion of Builders has a
NEEU Website strictly for
NEEU Homes
The finest builders in the
area showcase their
homes at
BUILDERS
Are you searching for customers who are searching for a new home
Saratoga Homes
Contact Mario Duran
12300 Montwood DriveEl Paso TX 79928
915-855-1005
JOIN THE EL PASO
ASSOCIATION OF
BUILDERS TODAY
CALL 778-5387
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
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ServiceInc
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915-478-2404
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Border Solar can help
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The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 816
Buildeers Outlook
On the SceneEPAB Installtion amp
Awards Banquet
As the attendees ate
delicious medallions of beefthe award presentationsbegan Up first werespecial awards for somemembers who went beyondthe call of duty andincluded Lorraine HuitTerry Martin and Gina AvilaNext we announced the2015 Associate Member ofthe Year and the winnerwas Interceramic Tile andStone Gallery for theircontinuous support andwork with the associationA stunned Gaby Rubio
accepted the award on behalf of the entire Interceramicfamily ldquoI am at a loss for words probably for the first
timerdquo Gaby told the crowd Later on Gaby said sheimmediately called David Holguin to inform him of theaward ldquoDavid told me to thank the association for thisand to let you know that we will continue to supportwhere we canrdquo Rubio told the Outlook
The next award was for Builder Member of the Yearand the award was presented to outgoing PresidentEdgar Montiel of Palo Verde Homes He said that hewas surprised and grateful for the acknowledgement ofhis term and the three years he had worked for theassociation He was reminded that he still had anotheryear to go by staying on the executive team asimmediate Past President
Following Montiel was the John Schatzman Award anaward that isnrsquot given every year It was the brainchild ofExecutive Officer Ray Adauto and Past President MarkDyer Ray is the only vote on who gets this serviceaward given for service outside of the associationhonoring someone for being an ambassador and givingto the community The award went to Past PresidentBrad Roe Roe Engineering Brad has held various citystate and national offices including his current stint as aBoard member for the Public Service Board Roe wasshocked and had little to say other than thank youLater he told Adauto that he was especially thankfulbecause he went to Cathedral High School withSchatzman and that Schatzman built the house he stilllives in Roe also had some kind words for Ray withwhom he has a mentorship with ldquoI couldnrsquot wait to giveBrad this well-deserved and overdue award for all hersquosdone for the community association and both Cathedraland UTEPrdquo Adauto said
Another bid announcement was made that theassociation will retire the Pat Cox Award and insteadoffer a newly created meritorious service award to benamed for Sam Shallenberger and John Chaney bothgreat examples of association volunteer work Sam and
John were honored respectfully for their years of servicewith separate awards Chaney was bestowed the title ofYoung Designer Chairman Emeritus for his single handedcontinuation of the vital scholarship program done incooperation with two school districts Chaneyimmediately asked if we were doing the awards for otherreasons ldquoI need to know do you guys think that Samand I are on our last breath or whatrdquo he asked with agrin We assured him that we still need his work tocontinue so naming an award after him and Sam was just a way for us to say thank you
The Board was installed by Sam Shallenbergerfollowed by him installing the executive and president ldquoIam honored to do thisrdquo Shallenberger told us A list of2016 Board members will be posted in the January issueof the Outlook as well as the members of specialcommittees and directorships The evening wasenhanced with the generous donation of unwrapped toys
for needy kids Two local groups were honored to getthe toys The Junior Womenrsquos Club of El Pasodistributed to the Montana Vista area kids while CiudadNueva used their toys to stock an innovative givingcenter for families in the downtown area Yoursquoll seepictures from these two groups inside this issue ofOutlook
The next installation date has been set as we makearrangements for the incoming president and board nextyear Keep Friday December 2 2016 as EPABInstallation date
Continued from Front Cover
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 916
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
Pioneer Bank understands
nancesabout
spen ess me
offer products t
moreand
worry ng
help you
n o r en w
your finBusine lWhencommuPionee
t new
ancial needs we provides or personal whatever
we growyou grow
n y an s nceyourbeenhasBankr
eas s nce
oans
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ersonal andP
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usness ec ng
FREE Checking
provideun erstonlinethese a l lland cr
solutio
in bank
l
s the latest innovationsan s your nee s an
Pioneer BankyBill P nd additional bills from
edit card mdash then pay l
s to help you succeed
in
oansortgage
R
ay Online Bill P
tatementseS
Banking
Internet amp Mobile
Merchant Services
emote De osit
one - aso015 N Mesa
S
R e s l e r D
r
S
R
e s l e
r D
r
N M e s a S t
N M e s a S t
N
one - aso068 Gateway East
ona
2290
N
Gat ew ay E as t
Tra
e - o
Trawood
for more detailsee an represenepending on acco250000 Services
s insured by FDICo open aN
L e e
T r evi n o
Dr
L e e
T r evi n o
Dr
wood Dr
a ve unt
varyup toc accoun
p
oneer
n
Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
ldquoArdquo ra ted ca rriers sev eral a vailable
overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
Ex rcial eneral Contractors
rcial Umbrella
w wwbuilderagentnetworkcomww whubinternat ionalcom
El Paso Permian Basin and Surrounding Area
HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
NAHB MEMBERS GET EXCLUSIVE REGISTRATION DISCOUNTS
BuildersShowcom
AD1316
Invest in your future and get the tools you need to become an
industry leader at the 2016 NAHB International Buildersrsquo Showreg
(IBS) Learn from some of the industryrsquos best speakers see live
construction demos by leading experts and explore top manufacturers
and suppliersndashall at the building industryrsquos biggest event You just
canrsquot beat this incredible value
IBSVEGAS
IMPROVE YOUR BUSINESS IN JUST 3 DAYS AT IBS 2016
ibs 2016DISCOVER THE BUILDING UNIVERSE
january 19-21 Las Vegas
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
HOMES
Connect to the El Paso
Association of Builders
wwwelpasobuilderscom
innovative design
ampdesktop publishing
since 1984
ted escobedotedsnappypublishingbull com
talk amp text 915bull 820bull 2800
Get Creative Make it Snappy
Make your travel
arrangements now for
the 2016 International
Builders Show in
Las Vegas
Jan 19-21
brought to you by
Search No More The Associaion of Builders has a
NEEU Website strictly for
NEEU Homes
The finest builders in the
area showcase their
homes at
BUILDERS
Are you searching for customers who are searching for a new home
Saratoga Homes
Contact Mario Duran
12300 Montwood DriveEl Paso TX 79928
915-855-1005
JOIN THE EL PASO
ASSOCIATION OF
BUILDERS TODAY
CALL 778-5387
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
Jaimersquos Courier
ServiceInc
Jaimersquos Courier
ServiceInc
915-549-4533or
915-478-2404
Bonded insured for
your peace of mind
Give your customersthe lsquooption of the sunrsquo
Now more than ever
El Paso home buyers
are planning for the
future
Border Solar can help
you offer your
customers solar power
as a sensible
alternave
The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 916
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
Pioneer Bank understands
nancesabout
spen ess me
offer products t
moreand
worry ng
help you
n o r en w
your finBusine lWhencommuPionee
t new
ancial needs we provides or personal whatever
we growyou grow
n y an s nceyourbeenhasBankr
eas s nce
oans
Commercial L
ersonal andP
Savings
usness ec ng
FREE Checking
provideun erstonlinethese a l lland cr
solutio
in bank
l
s the latest innovationsan s your nee s an
Pioneer BankyBill P nd additional bills from
edit card mdash then pay l
s to help you succeed
in
oansortgage
R
ay Online Bill P
tatementseS
Banking
Internet amp Mobile
Merchant Services
emote De osit
one - aso015 N Mesa
S
R e s l e r D
r
S
R
e s l e
r D
r
N M e s a S t
N M e s a S t
N
one - aso068 Gateway East
ona
2290
N
Gat ew ay E as t
Tra
e - o
Trawood
for more detailsee an represenepending on acco250000 Services
s insured by FDICo open aN
L e e
T r evi n o
Dr
L e e
T r evi n o
Dr
wood Dr
a ve unt
varyup toc accoun
p
oneer
n
Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
ldquoArdquo ra ted ca rriers sev eral a vailable
overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
Ex rcial eneral Contractors
rcial Umbrella
w wwbuilderagentnetworkcomww whubinternat ionalcom
El Paso Permian Basin and Surrounding Area
HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
NAHB MEMBERS GET EXCLUSIVE REGISTRATION DISCOUNTS
BuildersShowcom
AD1316
Invest in your future and get the tools you need to become an
industry leader at the 2016 NAHB International Buildersrsquo Showreg
(IBS) Learn from some of the industryrsquos best speakers see live
construction demos by leading experts and explore top manufacturers
and suppliersndashall at the building industryrsquos biggest event You just
canrsquot beat this incredible value
IBSVEGAS
IMPROVE YOUR BUSINESS IN JUST 3 DAYS AT IBS 2016
ibs 2016DISCOVER THE BUILDING UNIVERSE
january 19-21 Las Vegas
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
HOMES
Connect to the El Paso
Association of Builders
wwwelpasobuilderscom
innovative design
ampdesktop publishing
since 1984
ted escobedotedsnappypublishingbull com
talk amp text 915bull 820bull 2800
Get Creative Make it Snappy
Make your travel
arrangements now for
the 2016 International
Builders Show in
Las Vegas
Jan 19-21
brought to you by
Search No More The Associaion of Builders has a
NEEU Website strictly for
NEEU Homes
The finest builders in the
area showcase their
homes at
BUILDERS
Are you searching for customers who are searching for a new home
Saratoga Homes
Contact Mario Duran
12300 Montwood DriveEl Paso TX 79928
915-855-1005
JOIN THE EL PASO
ASSOCIATION OF
BUILDERS TODAY
CALL 778-5387
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
Jaimersquos Courier
ServiceInc
Jaimersquos Courier
ServiceInc
915-549-4533or
915-478-2404
Bonded insured for
your peace of mind
Give your customersthe lsquooption of the sunrsquo
Now more than ever
El Paso home buyers
are planning for the
future
Border Solar can help
you offer your
customers solar power
as a sensible
alternave
The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1016
wwwnprorg Every investor would love this gift a
really good crystal ballItd be so helpful to look right through
the orbuculum and glimpse the futureprices of stocks bonds and gold bars
Unfortunately no such ball existsOur next best option is to turn toeconomic forecasters And in generalthe professionals see mostly goodnews for 2016
The mainstream view is that the newyears gross domestic product mdash thebroadest measure of the economy mdashwill grow in the 25 to 3 percent rangeIn the first 6 12 years of this recoverythe average growth rate has been inthe 2 to 25 percent range
In other words most economistsbelieve the coming year may bring aslightly better pace of expansion than
what we are seeing nowHere are some 2016 predictions thatreflect commonly held opinions amongtop forecasters
Corporate profits perking upEarnings growth is expected toaccelerate Resumption of earningsgrowth is key to stock marketperformance in 2016 [which means]another year of potentially positivereturns mdash LPL Financial
Oil prices staying low They likelywill remain depressed and may evenfall below $35 a barrel I dont thinkweve seen the bottom of energy mdashLaurence Fink BlackRock chairmanspeaking on Bloomberg TV
Interest rates rising The FederalReserve has finally begun hiking short-term interest rates and now is likely toproceed very slowly IHS Global Insightexpects four [quarter-percentage-point]increases in 2016 (in March JuneSeptember and December) and fourmore in 2017 mdash IHS Global Insight
Residential constructionimproving Homebuilding especiallysingle-family homebuilding will remaina key driver of economic growth in2016 There is a great deal of pent-updemand for housing mdash PNC senioreconomist Gus Faucher
Unemployment falling The 5percent jobless rate could go evenlower perhaps down to the mid-4smdash Julie Heath director of theUniversity of Cincinnatis EconomicCenter
Auto sales setting records Autosales are projected to hit 173 millionby the end of 2015 just shy of the2000 record of 174 million Thatthreshold certainly will be surpassed in2016 as sales stretch to an almost-mythical 18 million vehicles mdash RobertWeagley chair of the personalfinancial planning department at theUniversity of Missouri
Manufacturing strengthening Themanufacturing economy is stabilizingafter a difficult 18-month period (mid-2014 to late 2015) and may acceleratefurther mdash John Canally economicstrategist for LPL Financial
Wages inching up The US ispoised for real wage growth of 27barring rising inflation mdash Korn FerryHay Group
Superlow inflation means workersoften dont see big raises andconsumers may delay buying thinkingprices will drop some more
Prices Are Low And That CouldBe Bad
While most predictions are on thepositive side for companies workers
and consumers economists also seepotential trouble spots Those includea too-strong-dollar that could furtherdepress US export sales continuedsluggishness in China plungingcommodity prices that could lead tomany more layoffs and terroristevents
And speaking of forecasts how didthe professionals do when predicting2015
Pretty good reallyHeres a line from a Wall Street
Journal story that ran in mid-Decemberlast year
The US economy is poised forstronger growth in 2015 due to falling
gas prices a tighter job market andexpectations of larger wage gainsaccording to the latest Wall Street
Journal survey of economistsThose forecasters may not have had
a crystal ball but at least for 2015
their darts mostly landed on the rightnumbers
10 Builders Outlook 2 15 issue 12
Pioneer Bank understands
nancesabout
spen ess me
offer products t
moreand
worry ng
help you
n o r en w
your finBusine lWhencommuPionee
t new
ancial needs we provides or personal whatever
we growyou grow
n y an s nceyourbeenhasBankr
eas s nce
oans
Commercial L
ersonal andP
Savings
usness ec ng
FREE Checking
provideun erstonlinethese a l lland cr
solutio
in bank
l
s the latest innovationsan s your nee s an
Pioneer BankyBill P nd additional bills from
edit card mdash then pay l
s to help you succeed
in
oansortgage
R
ay Online Bill P
tatementseS
Banking
Internet amp Mobile
Merchant Services
emote De osit
one - aso015 N Mesa
S
R e s l e r D
r
S
R
e s l e
r D
r
N M e s a S t
N M e s a S t
N
one - aso068 Gateway East
ona
2290
N
Gat ew ay E as t
Tra
e - o
Trawood
for more detailsee an represenepending on acco250000 Services
s insured by FDICo open aN
L e e
T r evi n o
Dr
L e e
T r evi n o
Dr
wood Dr
a ve unt
varyup toc accoun
p
oneer
n
Finance
No Crystal Ball
Heres the 2016 economic forecasts
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
ldquoArdquo ra ted ca rriers sev eral a vailable
overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
Ex rcial eneral Contractors
rcial Umbrella
w wwbuilderagentnetworkcomww whubinternat ionalcom
El Paso Permian Basin and Surrounding Area
HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
NAHB MEMBERS GET EXCLUSIVE REGISTRATION DISCOUNTS
BuildersShowcom
AD1316
Invest in your future and get the tools you need to become an
industry leader at the 2016 NAHB International Buildersrsquo Showreg
(IBS) Learn from some of the industryrsquos best speakers see live
construction demos by leading experts and explore top manufacturers
and suppliersndashall at the building industryrsquos biggest event You just
canrsquot beat this incredible value
IBSVEGAS
IMPROVE YOUR BUSINESS IN JUST 3 DAYS AT IBS 2016
ibs 2016DISCOVER THE BUILDING UNIVERSE
january 19-21 Las Vegas
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
HOMES
Connect to the El Paso
Association of Builders
wwwelpasobuilderscom
innovative design
ampdesktop publishing
since 1984
ted escobedotedsnappypublishingbull com
talk amp text 915bull 820bull 2800
Get Creative Make it Snappy
Make your travel
arrangements now for
the 2016 International
Builders Show in
Las Vegas
Jan 19-21
brought to you by
Search No More The Associaion of Builders has a
NEEU Website strictly for
NEEU Homes
The finest builders in the
area showcase their
homes at
BUILDERS
Are you searching for customers who are searching for a new home
Saratoga Homes
Contact Mario Duran
12300 Montwood DriveEl Paso TX 79928
915-855-1005
JOIN THE EL PASO
ASSOCIATION OF
BUILDERS TODAY
CALL 778-5387
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
Jaimersquos Courier
ServiceInc
Jaimersquos Courier
ServiceInc
915-549-4533or
915-478-2404
Bonded insured for
your peace of mind
Give your customersthe lsquooption of the sunrsquo
Now more than ever
El Paso home buyers
are planning for the
future
Border Solar can help
you offer your
customers solar power
as a sensible
alternave
The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1116
To date the following sevenresolutions and one recommendationhave been submitted by NAHBdirectors for consideration by theNAHB Board of Directors through the
NAHB resolutions process at theupcoming IBS Board meeting
Here is a summary of each resolutionand recommendation along with thename of the sponsor and thecommitteescouncils to which it hasbeen referred If there is current NAHBpolicy related to the proposedresolution the policy is listed with alink to the existing policy statement
Here are all the resolutionssubmitted to date
Resolutions and recommendations canstill be submitted for consideration atthe IBS Board Meeting but will requirea two-thirds majority vote (rather thana simple majority) for passage by theboard To submit a resolution the fullresolution should be emailed to TomWoods Chairman of the Boardthrough Jessica Lynch at NAHB (800-368-5242 x8401) by a directorcurrently serving on NAHBs Board ofDirectors
Emerging Technologies inResidential Construction AsksNAHB to support efforts to protectsmall businesses from regulations andliability related to the use of emergingtechnologies to oppose efforts toimpose uncompetitive limits on the useof emerging technology and topromote the development of newtechnologies Sponsored by theBusiness Management amp InformationTechnology Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Custom HomeBuilders Land Development andConstruction Codes amp StandardsCommittees
Staff contact Felicia Watson(x8229) Alex Strong (x8279)
Americans with Disabilities Act(ADA) Asks NAHB to urge federalagencies to expand programs toeducate the construction industry onthe requirements of the ADA support
model accessibility building codesendorsed by the Dept of Justice (DOJ)as providing a safe harbor forcomplying with the ADA urge DOJ todevelop clear criteria for meeting ADA
requirements and advocate to limitliability for industry members whomake a good faith effort to comply withthe ADA Sponsored by the LandDevelopment Committee Referred tothe Construction Liability RiskManagement amp Building MaterialsFederal Government Affairs SingleFamily Builders Legal Action andConstruction Codes amp StandardsCommittees NAHB Remodelers andMultifamily Council
Staff contacts Felicia Watson(x8229) Claire Worshtil (x8309)
Ginnie Mae Asks NAHB to urgeCongress to remove Ginnie Maersquossalary and expenses from the federalbudget appropriations process in orderto ensure that Ginnie Mae hasadequate funding and require GinnieMae to contribute funds annually to afund to support affordable housingSponsored by the Housing FinanceCommittee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)
Require Congressional Review forRule Adoption Asks NAHB tosupport the ldquoRegulations from theExecutive in Need of Scrutiny Actrdquo(REINS Act) Sponsored by theLouisiana HBA Referred to theFederal Government AffairsCommittee
Staff contact Alex Strong (x8297)
Related policy ReduceRegulatory Burdens on SmallBusinesses
Comprehensive Framework forHousing Finance System ReformUpdates and replaces NAHBrsquos policyon this topic Asks NAHB to supportreform that maintains a robust housingfinance system restarts a carefullyregulated fully private mortgage-
backed securities system continuesthe role of the federal governmenthousing agencies enhances the roleof state and local housing financeagencies supports options for the
Federal Home Loan Banks to expandand support correcting other flaws inthe mortgage market that contributedto the causes of the Great RecessionSponsored by the Housing Finance
Committee Referred to the FederalGovernment Affairs Committee and theMultifamily Council
Staff contact Chellie Hamecs(x8425)Replaces policy Comprehensive
Framework for Housing FinanceSystem Reform
Water Conservation Updates andreplaces NAHBrsquos policy on this topicAsks NAHB to support voluntary andcost-effective initiatives and economicincentives that encourage waterconservation in new and existingstructures promote the ICC 700National Green Building Standard as areference for those entities seeking toestablish water efficiency programsSponsored by the EnvironmentalIssues and Construction Codes ampStandards Committees Referred tothe Federal Government Affairs SingleFamily Builders and LandDevelopment committees and theNAHB Remodelers and MultifamilyCouncil
Staff contact John Ritterpusch(x8325)Replaces policy Water Conservation
Performance Standards in EnergyCodes Updates and replaces NAHBrsquospolicy on this topic Asks NAHB tosupport cost-effective performance-based provisions within model energy
codes and standards considersupporting proposed changes toexisting model energy codes andstandards that increase options orreduce limitations and recognize thatdesign choices in this area should notbe limited Sponsored by theConstruction Codes amp StandardsCommittee Referred to the SingleFamily Builders Committee and theNAHB Remodelers and MultifamilyCouncil
Staff contact Craig Drumheller(x8565)
Replaces policy PerformanceStandards in Energy Codes
National Builder CertificationProgram Asks that NAHB to conducta pilot market research study in NewJersey to explore the feasibility ofdeveloping a national buildercertification program and to form aworking group to oversee this effortSponsored by the New Jersey BuildersAssociation Referred to the PublicAffairs Membership Education andBudget amp Finance Committees
Staff contact Melissa Voorhees(x8251)
11 15 issue 12 Builders Outlook
Insurance developed for builders
Developed for builders with the ba cking of the strongest insura ncecarriers serving the Texas building industry our insurance progra moffers flex ible coverage options and rates that a re more competitive than ever A s an authorized member of Builder Agent Network copy w ersquorededicated to providing builders and contra ctors with the best-in-cla ssinsurance programs pricing underwriting resources a nd service
Product Portfolio Highlights
ldquoArdquo ra ted ca rriers sev eral a vailable
overage for property damag e that results from faulty defectiveor poor work manship in your work
va ilable
Expanded policy form for commercial pro jects
Builderrsquos Risk master policies monthly reporting a nnua l and one shots Work ersrsquo Comp - Tw o hig hly cost-effectiv e programs
Ex rcial eneral Contractors
rcial Umbrella
w wwbuilderagentnetworkcomww whubinternat ionalcom
El Paso Permian Basin and Surrounding Area
HUB International Insura nce Services 915-206-6047
Resolutions for the 2016 IBS Board of Directors Meeting
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
NAHB MEMBERS GET EXCLUSIVE REGISTRATION DISCOUNTS
BuildersShowcom
AD1316
Invest in your future and get the tools you need to become an
industry leader at the 2016 NAHB International Buildersrsquo Showreg
(IBS) Learn from some of the industryrsquos best speakers see live
construction demos by leading experts and explore top manufacturers
and suppliersndashall at the building industryrsquos biggest event You just
canrsquot beat this incredible value
IBSVEGAS
IMPROVE YOUR BUSINESS IN JUST 3 DAYS AT IBS 2016
ibs 2016DISCOVER THE BUILDING UNIVERSE
january 19-21 Las Vegas
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
HOMES
Connect to the El Paso
Association of Builders
wwwelpasobuilderscom
innovative design
ampdesktop publishing
since 1984
ted escobedotedsnappypublishingbull com
talk amp text 915bull 820bull 2800
Get Creative Make it Snappy
Make your travel
arrangements now for
the 2016 International
Builders Show in
Las Vegas
Jan 19-21
brought to you by
Search No More The Associaion of Builders has a
NEEU Website strictly for
NEEU Homes
The finest builders in the
area showcase their
homes at
BUILDERS
Are you searching for customers who are searching for a new home
Saratoga Homes
Contact Mario Duran
12300 Montwood DriveEl Paso TX 79928
915-855-1005
JOIN THE EL PASO
ASSOCIATION OF
BUILDERS TODAY
CALL 778-5387
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
Jaimersquos Courier
ServiceInc
Jaimersquos Courier
ServiceInc
915-549-4533or
915-478-2404
Bonded insured for
your peace of mind
Give your customersthe lsquooption of the sunrsquo
Now more than ever
El Paso home buyers
are planning for the
future
Border Solar can help
you offer your
customers solar power
as a sensible
alternave
The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1216
12 Builders Outlook 2015 issue 12
Trends
Technology Construction
NAHB MEMBERS GET EXCLUSIVE REGISTRATION DISCOUNTS
BuildersShowcom
AD1316
Invest in your future and get the tools you need to become an
industry leader at the 2016 NAHB International Buildersrsquo Showreg
(IBS) Learn from some of the industryrsquos best speakers see live
construction demos by leading experts and explore top manufacturers
and suppliersndashall at the building industryrsquos biggest event You just
canrsquot beat this incredible value
IBSVEGAS
IMPROVE YOUR BUSINESS IN JUST 3 DAYS AT IBS 2016
ibs 2016DISCOVER THE BUILDING UNIVERSE
january 19-21 Las Vegas
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
HOMES
Connect to the El Paso
Association of Builders
wwwelpasobuilderscom
innovative design
ampdesktop publishing
since 1984
ted escobedotedsnappypublishingbull com
talk amp text 915bull 820bull 2800
Get Creative Make it Snappy
Make your travel
arrangements now for
the 2016 International
Builders Show in
Las Vegas
Jan 19-21
brought to you by
Search No More The Associaion of Builders has a
NEEU Website strictly for
NEEU Homes
The finest builders in the
area showcase their
homes at
BUILDERS
Are you searching for customers who are searching for a new home
Saratoga Homes
Contact Mario Duran
12300 Montwood DriveEl Paso TX 79928
915-855-1005
JOIN THE EL PASO
ASSOCIATION OF
BUILDERS TODAY
CALL 778-5387
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
Jaimersquos Courier
ServiceInc
Jaimersquos Courier
ServiceInc
915-549-4533or
915-478-2404
Bonded insured for
your peace of mind
Give your customersthe lsquooption of the sunrsquo
Now more than ever
El Paso home buyers
are planning for the
future
Border Solar can help
you offer your
customers solar power
as a sensible
alternave
The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1316
13015 Issue 11 Builders Outlook
Association
News Events
JANUARY 6
LUNCH AND LEARN
NOON
EPAB OFFICE
JANUARY 13
BOARD MEETING
12 NOON
EPAB OFFICE
JANUARY 19-21
IBS SHOW
LAS VEGAS NV
UPCOMING
EVENTSWELCOME BACK
SODA SPONSOR
BELLA VISTA CUSTOM
HOMES
Connect to the El Paso
Association of Builders
wwwelpasobuilderscom
innovative design
ampdesktop publishing
since 1984
ted escobedotedsnappypublishingbull com
talk amp text 915bull 820bull 2800
Get Creative Make it Snappy
Make your travel
arrangements now for
the 2016 International
Builders Show in
Las Vegas
Jan 19-21
brought to you by
Search No More The Associaion of Builders has a
NEEU Website strictly for
NEEU Homes
The finest builders in the
area showcase their
homes at
BUILDERS
Are you searching for customers who are searching for a new home
Saratoga Homes
Contact Mario Duran
12300 Montwood DriveEl Paso TX 79928
915-855-1005
JOIN THE EL PASO
ASSOCIATION OF
BUILDERS TODAY
CALL 778-5387
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
Jaimersquos Courier
ServiceInc
Jaimersquos Courier
ServiceInc
915-549-4533or
915-478-2404
Bonded insured for
your peace of mind
Give your customersthe lsquooption of the sunrsquo
Now more than ever
El Paso home buyers
are planning for the
future
Border Solar can help
you offer your
customers solar power
as a sensible
alternave
The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1416
The Costs of Not Having HealthInsurance
Itrsquos open enrollment time to selectyour health insurance plan for thecoming year
If you were thinking about skippingit this time around get ready to payregardless Fines for not havingcoverage are increasing For 2016they will be $695 for each adult and$34750 for each child up to $2085for a family Or it could be 25 percentabove the filing threshold says theIRS (individuals $10150 couplesfiling jointly $20300) whichever ishigher
How will the government find outwhether or not you have insurance
The law requires insurancecompanies to submit ldquoproof ofinsurancerdquo which includes thenumber of months you were coveredYou will get that notice and the IRSwill get it too The IRS will penalize allthose without insurance unless theyqualify for an exemption
If you are one of the 80 percent ofAmericans who get a tax refund thefine will be deducted from it If notthe IRS wonrsquot come banging on yourdoor The Patient Protection andAffordable Care Act forbids the IRSfrom using levies or liens to collectthe penalty
If yoursquove calculated that penaltieswill cost less than your annual healthinsurance premiums think again Yesmedical insurance is expensivemdashbut
so is medical care In a 2014 studyNerdWallet reported that
One in five American adultsstruggles to pay medical bills
More than 35 million will becontacted by collections agencies forunpaid medical bills
Nearly 17 million will have alower credit rating due to high medicalbills This could affect their ability toget a mortgage car loan or othercredit
Nearly 10 million will not be ableto pay for necessities such as rentheat and food due to medical bills
Nearly 2 million Americans live inhouseholds that will declare
bankruptcy due to medical billsIf choosing a plan overwhelms you
please call us As licensed insuranceprofessionals we have the expertiseto help you select a health insuranceplanmdasheven from the health insuranceexchanges And it wonrsquot cost youextra
Builders Outlook 2 15 issue 12
Yeaaaaaa Well the end of the
trail is here for me and now itrsquos time to
say goodbye after five years as the
associatersquos chair My job will be taken
over by John Dorney from DorneySecurity John is a good man and any
help you can give him will be
appreciated
I have enjoyed working with some
great Presidents and hardworking
executive board members I have
enjoyed the opportunity given to me to
be the Associates Chair This is a job
where you try to get as much help as
possible from the associates to makethe necessary budget and make sure
everyone has a good time at the
event
I want to thank Margret and Ray for
all the help that they have given me
over the years They have made life
much easier for every member of the
executive in my five years
So on that note have a very Merry
Christmas and Prosperous andhealthy New Year See you at the next
Pachanga
Sam ShallenbergerMorrison Supply
Joe BernalEmployer Benefits of El Paso
The cost of not havinghealth insurance
Associates
Council
Expert
Advice
14
Jaimersquos Courier
ServiceInc
Jaimersquos Courier
ServiceInc
915-549-4533or
915-478-2404
Bonded insured for
your peace of mind
Give your customersthe lsquooption of the sunrsquo
Now more than ever
El Paso home buyers
are planning for the
future
Border Solar can help
you offer your
customers solar power
as a sensible
alternave
The future starts
todayCrossing to Clean Energy
7365 Remcon Circle
El Paso TX 79912
(915) 613bull4168
follow us on twier and
BorderSolar
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1516
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616
7212019 Builders Outlook 2015 Issue 12
httpslidepdfcomreaderfullbuilders-outlook-2015-issue-12 1616