The Washington, D.C.-based National Multi Housing Council (NMHC) and Arlington, Va.-based National Apartment Association (NAA) announced last month that they have agreed to continue their joint legislative program to lobby Capitol Hill on behalf of the multifamily apartment industry. For nearly 20 years, the associations have jointly advocated on behalf of the apartment industry through the NMHC/NAA Joint Legislative Program (JLP), though the partnership has not always been amicable. Last fall, the groups announced that they would end the program effective March 1, 2009. Last month’s agreement to extend the partnership for at least three more years was the first joint announcement made by the associations since that time. At the time of the announcement, NMHC president Doug Bibby said the partnership leverages NAA's vast membership and NMHC's access to Capitol Hill in order to create a powerful lobbying effort.
Bibby sat down in an exclusive interview with Multifamily Executive to share his thoughts on the top 5 priorities on the JLP Capitol Hill agenda for 2010.
1. Ensuring the industry's continued access to capital as lawmakers undertake financial regulatory reform and the possible restructuring of government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.
"We have a GSE task force—that’s how vital the GSEs are to the future of the multifamily housing industry. When you look at the roughly $5.5 trillion dollars that Fannie Mae and Freddie Mac have on- and off-balance sheet, anything that is done has to be done very thoughtfully and with a long-term horizon in mind. You can’t flip a switch tomorrow and privatize the two fully or make them hybrids—that’s just too complicated, and there is too much at risk to the multifamily marketplace right now. Nothing is going to be done precipitously, and nothing is going to be done without thoughtful, lengthy deliberation. Our short-run advice to all policy makers is to do no harm. The multifamily housing sector is a beacon of success, prudent underwriting, and stewardship that we have not seen in the single-family sector. We don’t want sweeping changes with unintended consequences."
2. Securing workable, cost-effective energy efficiency standards for buildings in proposed and new energy and climate change legislation.
"The industry is green. It is energy-efficient. And we are encouraging our members to be more so. Apartments are extremely efficient users of infrastructure. When you are able to site them in downtown areas and infill areas, you don’t have to build new roads and new schools and new police and fire stations and utilities. You can take advantage of existing infrastructure. We’re most concerned about sweeping goals—30 percent reduction in carbon emissions by 2025, for example. When 60 percent to 70 percent of the energy usage in apartment community is controlled by the residents, it is very difficult to reach those blanket efficiencies. We’d like policy makers to be mindful of what can be done practically and what the expected payback periods are for energy-efficiency initiatives."
3. Advocating against proposals to triple the taxation on a general partnership’s promote (or “carried interest”), which the JLP believes would eventually stifle the nascent economic recovery and exacerbate the nation's affordable housing shortage.
"The analogy to the 1986 and 1989 Tax Act is not so far-fetched—we anticipate lots of unintended consequences that really hurt real estate. Even with well-intentioned reforms, Congress needs to consider those unintended consequences. I think with carried interest—it is so pervasive in transactions in so many sectors of our economy—you could stifle economic recovery and industry entrepreneurship right off the bat."
4. Opposing the Employee Free Choice Act (“card check”), which the JLP says would disproportionately increase the political power of unions at considerable cost to employees and businesses during this severe economic recession.
"The thing we are most concerned about is taking away the worker’s right to privacy in deciding whether to vote for representation or not. It’s almost like a taking in real estate to us—it is the same magnitude of error. It also opens the door to strong-arm tactics. An alternative would be to look at the National Labor Relations Board and reform it in some way where employers and workers meet and all considerations are taken into mind. This was an ill-conceived bill—it’s wrong, and it’s at the wrong time."
5. Stressing the need for a balanced housing policy that better reflects demographic preferences and lifestyle changes in our society.
"Cutting across the Clinton and Bush administrations, we’ve had 16 years of cheerleading for home ownership. When you have the rhetoric and the policies and the subsidies all working together for home ownership as a vehicle for building wealth, it swept everyone up, and we were qualifying millions of people for homes that should never have been approved for ownership. That hurt the economy just as much as it hurt those people’s lives and their credit. It was a painful lesson to learn, and we hope now going forward there is more of a balance. We have demographics in household formation that are steering us very strongly towards rental housing, towards mixed-income, mixed-used, and transit oriented communities. If we are still stuck on the idea that everyone needs to own a detached house out in the suburbs, we are going to be way out of whack with demand."