AIMS Update: New White Paper Outlining Key Copyright, Music Licensing Principles Available

 

 

 

National Multi Housing Council | AIMS Update
National Multi Housing Council | AIMS Update
November 8, 2013
JOINT LEGISLATIVE PROGRAM NEWS
New White Paper Outlining Key Copyright and Music Licensing Principles Now Available
NAA/NMHC Participate in Two White House Meetings Focused on Finance-Related Issues
U.S. Supreme Court Prepares to Hear Disparate Impact Case Next Month
NAA/NMHC Take Active Role in ICC's Final Action Hearings for the 2015 Model Building Codes
Administration Incorporates Industry Feedback as It Looks to Expand Its Better Buildings Challenge to Apartments
Defense Department Initiates Strategic Review of Costs Related to Privatized Military Housing
NAA/NMHC Send Letter to Budget Conference Committee on Reforms to Affordable Housing Programs
NAA/NMHC Continue to Push for More Research, Transparency in Establishing New Regulations Under the Clean Water Act
As Program Reforms Kick In, Hikes in Flood Insurance Prices Spur Congress to Consider Delaying Some Changes
NAA/NMHC Urge USDA to Reconsider Increasing Management Fees for Rural Apartments
Congress Faces New Deadline for Reaching Budget Agreement Before Additional Spending Cuts
Budget Compromise Extends Credit Authority for Key FHA Multifamily Financing Programs
NAA NEWS
Registration Now Open for the 2014 NAA Capitol Conference
JOINT LEGISLATIVE PROGRAM NEWS
New White Paper Outlining Key Copyright and Music Licensing Principles Now Available

NMHC has released a NAA and NMHC members-only white paper to provide background on music licensing principles for apartment companies.  Performing rights organizations (PROs) have contacted a number of NAA/NMHC members regarding music in apartment community common areas.   The law for music licensing is complex and whether a license may be needed depends on specific facts including an area’s openness to the public, square footage, the media used and the number and/or size of television screens and speakers, among other property-specific factors.

Commissioned by NMHC, the white paper, by Cydney A. Tune, senior counsel at Pillsbury Winthrop Shaw Pittman LLP, provides basic information about key copyright and music licensing principles and a framework to help apartment companies consider how those principles may apply to a particular community. The paper also addresses issues related to public and semi-public spaces, performance licenses, sources of music, and equipment and devices for audio-only and audiovisual use. In addition, the paper includes a Frequently Asked Questions (FAQ) section that answers some common questions from apartment firms.

Download the white paper here. (Find the white paper under Articles and Reports.)

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NAA/NMHC Participate in Two White House Meetings Focused on Finance-Related Issues

On Wednesday, a small delegation from NAA/NMHC visited the White House to discuss housing finance reform with key members of President Obama’s National Economic Council. The hour-and-a-half meeting resulted in meaningful dialogue between NAA/NMHC and the Obama Administration about the uniqueness of multifamily mortgage finance, as well as some of the critical elements of a well-functioning system.

Rep. Mel Watt (D-N.C.)

The substantive policy discussion regarding housing finance reform with Administration officials on Nov. 5 followed an earlier meeting at the White House on Oct. 28 to discuss Rep. Mel Watt’s  (D-N.C.) nomination to replace Edward DeMarco as director of the Federal Housing Finance Agency (FHFA), the regulator for government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.

NAA/NMHC were among a handful of key industry stakeholder organizations invited to participate in the Watt discussion. Top industry leaders at the meeting included NMHC President Doug Bibby; National Association of Home Builders CEO Jerry Howard; American Bankers Association President and CEO Frank Keating; Mortgage Bankers Association President and CEO Dave Stevens; Financial Services Roundtable SVP for Public Policy Scott Talbott; and National Association of Realtors President Gary Thomas.

However, on Oct. 31, Senate Republicans blocked Watt’s nomination. Democratic leaders have responded, saying they will try to advance the nomination once again. NAA/NMHC continue to underscore the need for a permanent director of FHFA given the continuing uncertainty over the regulatory environment and the future of the GSEs, which has led to undue caution in the housing markets and a slowdown of the housing recovery.

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U.S. Supreme Court Prepares to Hear Disparate Impact Case Next Month

On Dec. 4, the U.S. Supreme Court is scheduled to hear arguments in the Mount Holly v. Mount Holly Gardens Citizens in Action, Inc. case. The outcome of the case will determine if disparate impact claims are cognizable under the Fair Housing Act.

The U.S. Department of Housing and Urban Development (HUD) has long held the position that federal housing discrimination laws also apply to unintentional acts of discrimination that have a disparate impact on a protected class. The court’s final decision will affect apartment owners, managers and developers, as the rule has called into question some often-used industry and business practices, such as resident screening.

NAA/NMHC already weighed in on the issue, joining other real estate groups in filing an amicus brief with the court that argued that the act does not recognize disparate impact claims. The brief also argued that disparate impact liability is a judge-made rule that improperly extends the scope of the Fair Housing Act and creates de facto protected classes.

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NAA/NMHC Take Active Role in ICC's Final Action Hearings for the 2015 Model Building Codes

In October, the International Code Council (ICC) held the final action hearings for several of the 2015 national model building codes. NAA/NMHC’s efforts in this round of code development focused primarily on the energy, fire, property maintenance, existing building and residential codes.

Throughout the code development process, NAA/NMHC staff worked with code consultants and collaborated with other industry representatives to improve existing code provisions and oppose unnecessary escalations in construction costs. Our participation resulted in a number of hearing decisions favorable to multifamily firms and resulted in the disapproval of numerous proposals that would have had a negative impact on the apartment industry.

The action taken during the October final action hearings will be included in the 2015 ICC codes. The next round of codes will not be published until 2015, after the final round of code development is completed in 2014.

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Administration Incorporates Industry Feedback as It Looks to Expand Its Better Buildings Challenge to Apartments

As a result of an August roundtable discussion at the White House on extending the Obama Administration’s Better Buildings Challenge (BBC) to the multifamily sector, the Administration indicated that changes will be made to address a number of program hurdles raised by industry participants during the meeting.

For example, the Administration addressed concerns about the widespread availability of whole building energy consumption data and the effect that would have on multifamily firms achieving the program’s goal of a 20 percent reduction in energy consumption across participating firms’ portfolios in a decade. The Administration suggested that the U.S. Department of Energy will develop a sampling methodology for energy consumption that could be used until the time that whole building data is available. 

In addition, changes have been made to address some of the issues created by the 10-year timeline. Owners are now permitted to roll the clock back three years to establish the baseline figure for the portfolio’s energy consumption and, in the process, capture the energy savings that have accrued as a result of improvements that may have already been made.  In an effort to address the fluid nature of portfolios and the fact that many owners do not hold a property for 10 years, the federal partners also have suggested that portfolios with high building turnover (typically greater than five percent of total committed square feet per year, on average) may track the average annual percent improvement across their portfolio, rather than their cumulative percent improvement since a baseline period.  Participants will commit to achieving at least two percent average annual improvement, which is consistent with 20 percent improvement over 10 years. 

The launch of the program has been affected by the October government shutdown but is anticipated for some time in November. Additional information on the program is available from Maria Vargas at Maria.Vargas@ee.doe.gov.  

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Defense Department Initiates Strategic Review of Costs Related to Privatized Military Housing

In response to sequestration-driven budget cuts, Congress and the Department of Defense (DoD) are reviewing several proposals that affect privatized military housing. Congress has directed a Government Accountability Office study to report certain litigation expenses associated with military housing projects. While the measure’s supporters maintain such transparency is intended to safeguard the fiscal health of housing projects, NAA/NMHC are working to ensure any reporting requirements are clear, narrowly tailored and avoid unduly burdening housing providers.

As part of a strategic review, DoD also proposed reductions to the Basic Allowance for Housing (BAH) to help meet continued sequestration-related cost reduction targets. This would substantially reduce the revenue collected at privatized housing projects and also negatively impact the rent rates and occupancy of private apartment communities serving military installations. NAA/NMHC are urging that DoD exercise caution before using BAH reductions to satisfy budget cuts and advocating for a measured approach to BAH changes that engages all stakeholders and assesses the effects across the real estate sector.

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NAA/NMHC Send Letter to Budget Conference Committee on Reforms to Affordable Housing Programs

On Oct. 21, NAA/NMHC joined a broad cross section of stakeholders on a letter to the Budget Conference Committee regarding certain affordable housing reforms. The Conference Committee was created to resolve the FY 2014 federal budget as part of the Continuing Resolution passed on Oct. 17 to end the government shutdown by temporarily extending the budget and lifting the debt ceiling. 

In the letter, NAA/NMHC argued that any product considered by the Budget Conference Committee should include regulatory reforms to affordable housing programs long supported by private sector participants and advocacy groups alike. Reforms listed in the letter include streamlined property inspections, rent calculations and re-certifications, along with funding for English translations of mandatory federal forms for property owners/managers. These reforms represent much needed efficiencies in the Section 8 program and a substantial savings for lawmakers.

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NAA/NMHC Continue to Push for More Research, Transparency in Establishing New Regulations Under the Clean Water Act

On Oct. 30, the Environmental Protection Agency (EPA) and the Army Corps of Engineers withdrew a controversial, NAA/NMHC-opposed guidance document that was being used to determine which properties were subject to the Clean Water Act’s (CWA) protections. To help clarify jurisdictional issues raised as a result of recent U.S. Supreme Court decisions, EPA submitted a draft rule to the Office of Management and Budget (OMB) for review. OMB has 90 days to complete its review.

Through its membership in the Waters Advocacy Coalition, NAA/NMHC had objected to the de facto regulatory status of the guidance document and called on federal regulators to pursue a full and open rulemaking effort.

EPA also recently released a long-awaited scientific study that evaluates the connection between intermittently flowing streams and certain wetlands to waters in the U.S.  The draft report, “Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of the Scientific Evidence,” is the scientific underpinning for anticipated regulations under the Clean Water Act. However, NAA/NMHC are concerned that the report provides insufficient analysis for the agency to make determinations on which properties would be subject to regulation under the federal Clean Water Act.

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As Program Reforms Kick In, Hikes in Flood Insurance Prices Spur Congress to Consider Delaying Some Changes

 

Last year, Congress enacted the Biggert-Waters Flood Insurance Reform Act of 2012 to extend the National Flood Insurance Program (NFIP) for five years while enacting reforms to help address the program’s $24 billion debt load. The reforms were designed to return NFIP to solvency by phasing in revised pricing on the nearly 20 percent of all policyholders who pay a subsidized rate. Absent this national program, many apartment owners would likely not have access to flood insurance, since the private market has never stepped into this space in a meaningful way.

However, as the reforms have begun to be implemented, many property policyholders recently have objected to significant, if not unrealistic, price increases when they renew their policies, transfer properties or are mapped into a riskier flood zone. Recognizing the unintended consequences associated with the program rollout, Congress has responded by acting to delay these new price increases.

Bipartisan bills have been introduced in both the House and the Senate to delay the flood insurance rate increases for most policyholders, excluding second homes and businesses, for up to four years. Apartment properties are not considered businesses under the program and, therefore, are expected to benefit from this relief. Additionally, the extension legislation requires the Federal Emergency Management Agency to conduct a study on affordability challenges and propose alternatives to the rate hikes.

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NAA/NMHC Urge USDA to Reconsider Increasing Management Fees for Rural Apartments

On Oct. 30, NAA/NMHC joined industry stakeholders on a letter to the U.S. Department of Agriculture’s Rural Development office urging it to reconsider the decision not to increase management fees for managers of rural apartments in FY 2014. NAA/NMHC signed a similar letter on this topic in 2012 and continue to work with rural housing service staff to convey the importance of accurately calculated management fees for affordable housing programs.

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Congress Faces New Deadline for Reaching Budget Agreement Before Additional Spending Cuts

October brought one of the most contentious political debates in recent memory as the federal government shut down for 16 days after Congress failed to reach agreement regarding fiscal year 2014 funding prior to Oct. 1. Hours before the government was slated to potentially default on its debt, Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) reached a compromise to fund the government until Jan. 15, 2014, the date that the next round of sequestration budget cuts take effect. It also extended the debt ceiling to Feb. 7, 2014.

While the compromise temporarily resolves the budget issue and the debt ceiling crisis, the agreement requires the conference committee to reconcile proposed House and Senate budgets and submit recommendations by Dec. 13. Hanging in the balance are funding levels for key federal housing finance and affordable housing programs.

Congress does not appear to have the political appetite to make a grand bargain to address longer-term budgetary concerns. Instead, NAA/NMHC anticipate a smaller-scale compromise that addresses the sequester and the stopgap spending bill. Congress will have to pass a continuing resolution by Jan. 15 to avoid a repeat of the first half of October.
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Budget Compromise Extends Credit Authority for Key FHA Multifamily Financing Programs

Congress’ recent passage of the short-term continuing resolution to fund the government through Jan. 15, 2014, provided the Federal Housing Authority (FHA) with continued credit authority to close multifamily loans through that date and possibly beyond. Prior to the continuing resolution, FHA had reached the limit of its credit authority; Congress was unwilling to authorize additional authority, which disrupted a critical source of multifamily financing.

The U.S. Department of Housing and Urban Development asserts that FHA now has sufficient authority to respond to the backlog of commitments and to respond to commitment requests that were deferred. In a memo from Oct. 22 to multifamily HUB and field offices, Deputy Assistant Secretary for Multifamily Housing Ben Metcalf instructed staff to review the status of the applications that were submitted prior to the Sept. 17 credit authority expiration. He instructed staff to take new applications on a first-come-first-serve basis and only to grant priority to projects with Low-Income Housing Tax Credit deadlines.

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NAA NEWS
Registration Now Open for the 2014 NAA Capitol Conference

Invest your political capital wisely by participating in the 2014 NAA Capitol Conference – the nation’s largest gathering of apartment industry advocates. The annual conference will be held from March 9 – 11, culminating in Lobby Day on Capitol Hill on March 12.

Registration is now open.

Use your currency as an advocate to encourage Congress to address the long-term needs of the apartment industry. Invest in your political capital at the 2014 NAA Capitol Conference!

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AIMS

AIMS is the apartment industry's grassroots network operating under NAA and NMHC's Joint Legislative Program. AIMS represents more than 58,000 multifamily housing advocates.

 

 

 

 




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