July 2016 issue

www.hbaswi l .or g

HOME BUILDERS ASSOCIATION

NEWSBRIEF

The Official Newsletter of the Home Builders Association of Greater Southwest IL

The Voice of the Homebuilding and Remodeling Industries in Southwest Illinois. Representing

Bond, Calhoun, Clinton, Greene, Jersey, Madison, Monroe, Randolph and St. Clair Counties

Event results

are in!

Thank you to all of our builder participants,

sponsors and industry supporters!

3 homes SOLD!

2 lucky

guests won

tickets to a

St. Louis

Cardinals

game

Edwardsville on the path to

mandate 35% brick/stone/masonry

of the entire structure for all new

homes in the I-55 Corridor Project

The HBA Members & staff have been

present at 3 meetings in Edwardsville to

share facts and insight in opposition of

mandating any requirement for specific

materials on new construction.

Unfortunately two of the three ACS

Committee members didn’t feel that

pricing out home buyers or creative

control restrictions should get in the way

of mandating a perceived look of

“quality” for their future developments.

This will be going to City Council for 1st

and 2nd reading in July and the HBA

will continue to oppose this mandate.

The HBA is grateful for the input and

participation from the following

members on this issue: Jeff Lantz with

Lantz Homes; Jay Beard with Carrington

Homes; Mike Rathgeb with Spencer

Homes; Jeff Schmidt, Bruce Riedle and

Robb Schmidt all with RLP

Development.

If you would like further details on what

has transpired at these meetings please

contact the HBA office.

Approximately 644 consumers visited during

both weekends

80% INCREASE OF

WEBSITE TRAFFIC!

Facebook posts and ads reached over

33,500 users and gained 232 new

likes on our Consumer Event page.

2

Your 2016 Golf Committee: Chair: Robb Treat, Guaranteed Rate Inc.

Richard Shemwell, Arrowhead Building Supply Michelle Null, Benchmark Title

Jon Edler, Henges Interiors Shari Newby , IKO

Dave Padgett, Padgett Building & Remodeling Cherity Freeze, Wells Fargo Home Mortgage

Rob Verheyen, Wilke Window & Door

Stationary Beverage Sponsor

Ambassador Floor AUTCOhome Appliances Builders Club Rewards

Earthworks, Inc. Martin Glass Company

Roofers Mart Inc. Vogt Builders

Wells Fargo Home Mortgage

Give-A-Way Sponsor Benchmark Title Company

First Clover Leaf Bank Fischer Lumber

Gershman Mortgage New American Funding

Padgett Building & Remodeling RP Lumber

The Appliance Discounters Wells Fargo Home Mortgage

Yaekel & Associates

Hole Sponsors

Allen Roofing & Siding

Arrowhead Building Supply

Archway Heating & Cooling

Bank of Springfield

Belleville News-Democrat

Broadview Screen

Central Bank of St. Louis

CertainTeed Corp.

Chesley Fence

Diel & Forguson

First American Title Insurance

Gershman Mortgage

Greater Gateway Association of Realtors

Guaranteed Rate

Midwest Block & Brick

P & A Drywall Supply

Providence Bank

Realtors Association of Southwestern Illinois

Rebel, Inc.

Red-E-Mix

Shake and Shingle

TheBANK of Edwardsville

Veterans United Home Loans

Wells Fargo Home Mortgage

Wilke Window & Door

Golf Outing Sponsors

Course Contest Sponsor Belleville Supply Company

Custom Marble Hallmark Stone

Professional Women in Building Council RP Lumber

Wells Fargo Home Mortgage

Event Sponsor

Wells Fargo Home Mortgage

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SPONSORSHIP OPPORTUNITIES (includes 1 meal for company representative)

Give-A-Way Sponsor..………….FULL Each golfer will receive a great give-a-way gift

with your logo.

Stationary Beverage Sponsor…...FULL Be the “go to” stand for all golfers to get their

staple refreshments on the course.

Course Contest Sponsor………...$150 We provide the game and prize, you send the talent

and everyone is a winner. Games such as scattered

flags, chip shot contest, sling shot and more will be

offered.

Hole Sponsor……………..…….$100 Company name and logo on a course sign.

Complete the following information to register/sponsor this exciting event

Primary Contact_____________________________________________

Company Name_____________________________________________

Phone Number______________________________________________

E-Mail____________________________________________________

Name_____________________________________________________

Name_____________________________________________________

Name_____________________________________________________

Name_____________________________________________________

Total Golfers ___ FULL

Team Mulligans ___ $ 20 p/team

Team Skins ___ $ 20 p/team

Total Dinner Only ___ $25 each

SPONSORSHIPS

Give-A-Way Sponsor ___ FULL

Stationary Beverage ___ FULL

Course Contest ___ $150 each

Hole Sponsor ___ $100 each

Total Amount Due $__________

Cancellation will be accepted 3 days prior to the OUTING

No refunds or credits will be given for cancellations or no-shows.

Home Builders Association of Greater Southwest Illinois

6100 West Main St., Maryville, IL 62062

Office: (618) 343-6331 - Fax: (618)343-6335 - Email: hba@hbaswil.org

METHOD OF PAYMENT:

___ Check Enclosed ___ Invoice Member Company ___ Charge to Visa/Mastercard*

Card# _____________________________________________ Exp Date ________________

City/State/Zip ___________________________ Signature____________________________

FRIDAY, JULY 15th, 2016 Far Oaks Golf Course

419 Old Collinsville Rd., Caseyville

*credit card payments will include an additional 4% convenience fee

EVENT SPONSOR

The Herschel E. Johnson

Golf Classic

ON COURSE GAMES & CONTESTS

ARE ALL INCLUSIVE!

$125 per golfer ~ includes lunch, golf, dr inks and

dinner (dinner only $25 per person)

1st, 2nd & 3rd place Prizes for A & B flights

Skins & Mulligans sold at $20 per team

Appropriate attire required: Soft Spike facility. Men

collared shirts ~ Ladies golf sleeveless shirts permitted.

Personal coolers are strictly prohibited!

Volunteers are a must for this event! Please contact the HBA

office if you can spend the day with the golfers

(meals not included)

Check-in/Lunch 11:00 am

Shot Gun Start 12:00 pm

4

NAHB Economics estimates that 14 million American

households are priced out of the market for a new home by

government regulations that, on average, increase the new

home price by 24.3%.

Households become “priced

out” when they no longer

qualify for a new home

mortgage because of higher

prices.

A recent NAHB study

estimated that, on average,

regulations imposed by

government at all levels

account for 24.3% of the final new home price. For a typical

new single-family home built for sale, this translates into

additional $84,561.

The NAHB Priced Out Model uses the most recent US

household income distribution and estimates that 48.4

million US households can qualify for a new home

mortgage in the absence of government regulation.

However, after the regulatory costs are added to the price,

only 34.4 million households remain able to qualify for a

mortgage. The difference is 14 million US households

priced out of the new home market by price escalations due

to government regulations.

The assumptions NAHB Economics typically uses in

“priced-out” computations are a down payment equal to 10

percent of the purchase price and a 30-year fixed rate

mortgage. For a loan with this down payment, lenders

would typically require mortgage insurance, so NAHB also

assumes an annual premium of 45 basis points for private

mortgage insurance. Information about property taxes and

property insurance per dollar of home value comes from the

2014 American Community Survey (ACS).

The current version of the NAHB Priced Out Model uses

the most recent US household income distribution based on

the 2014 ACS data. NAHB Economics makes relatively

minor adjustments to the ACS income distribution to

account for income and population changes that may have

occurred since 2014.

Even though the NAHB Priced Out Model does not

estimate effects of new regulation on new home sales or

housing starts, it highlights often overlooked effects of

regulation on affordability of new homes.

The Remodelers Council created the

Remodelers of Distinction Award

(RODA) to bring attention to the

extraordinary work performed by

remodelers in the Metro East.

Applicants and Winners receive

consumer and peer recognition

throughout the year in print, social

media and HBA Remodelers website

page.

Deadlines & Fees:

October 1st, 2016

$75 per entry for HBA Member

$125 per entry for Non-HBA

Members

$25 Entry Late Fee

(project submission after deadline)

Categories: Addition, Basement, Bathroom, Deck, Exterior, Kitchen,

Landscaping, Outdoor Living Space, Specialty Projects, Structural,

Waterproofing and Whole House

Applications being accepted for

14 Million Households “Priced Out” by Government Regulation BY: NATALIA SINIAVSKAIA ON MAY 12, 2016

5

Friday - August 26th, 2016

12 pm Registration

Town Hall Archery 5901 Cool Sports Rd., Belleville

*40 Targets - bow rentals available *No range finders, broadheads or blunt points

Registration: complete the following information and return it to the HBA office (please print)

___ $40 Individual ___ $75 Team of two ___ $150 Team of four

___ $200 Arrow Quiver Sponsor ___ $100 Food/Beverage Sponsor ___ $50 Station Sponsor

TOTAL DUE $ _______ Method of Payment: ___Member Invoice ___Check ___Visa/MasterCard*

Credit Card# ____________________________________ Expiration: ______ Signature: ________________________

*credit card payments will include an additional 4% convenience fee

Company Name: ________________________________________________________________________________

Contact Name: _______________________________ Phone#/Email: ___________________________________

Name of attendee(s)

_______________________________________________ _______________________________________________

_______________________________________________ _______________________________________________

Home Builders Association of Greater Southwest Illinois

6100 West Main St., Maryville, IL 62062

Office: (618) 343-6331 - Fax: (618)343-6335

www.hbaswil.org ~ Email: hba@hbaswil.org

HBA Policy: Registration for the 3D Shoot is

considered confirmation of your participation and

will be invoiced if cancellation is not made within

3 days of the event.

$40 for individuals

$75 for team of two

$150 for team of four

Includes: Arrow Quiver, Drinks, Lunch and Friendly Competition

Sponsorships worth aiming for!

Arrow Quiver Sponsor……………$200

Logo on the Quiver given to all shooters

Food/Beverage Sponsor………....$100 Company Name on signage at stand

Station Sponsor……….…................$50

Company Name on signage at a field

CASH PRIZES for 1st, 2nd & 3rd Place teams and for Top Arrow

6

We are excited to announce the 2016 Building Industry Laws You Should Know

book. This publication is the result of your local and state Home Builders

Associations working together to provide you with valued information of

Illinois Building Laws put into this reference book.

Laws included are as follows:

Builder & Remodeler Laws

Consumer Protection Laws

Illinois Energy Conservation Code

Land Development Laws

Tax Policy Laws

Elected Officials 99th General Assembly

As a member of the HBA and as one of the many benefits you have received this book complimentary

in the mail.

In addition to the book we have included the HBA logo decal so you can proudly

display your membership status on your store or vehicle window, hardhats etc.

If you would like additional copies please contact the HBA office at (618) 343-6331.

2016 Building Industry Laws You Should Know Book!

Sponsored by our

2016

Platinum Sponsors

I t was a great evening to spend t ime wi th fel low friends and co -workers a t the

Fai rmount Park Racetrack. Many bets were made making each race ful l of

exci tement and ant icipat ion in hopes that someone would win big . An ext ra

special feature was seeing the e ight beauti ful Budweiser Clydesdales make an

appearance on the t rack .

7

# of reservations ____@ $35 per HBA Member ~ includes Dinner and soft drinks

Company Name: __________________________________________________________________________________________

Phone# & Email: _________________________________________________________________________________________

Name(s) of attending: ______________________________________________________________________________________

___Amount enclosed or payment below ___Will pay at the door (no shows will be invoiced) ___Invoice company

__________________________________________ ______ _____________________________________________

Charge to Visa/MasterCard Number* Exp Date Signature

*credit card payments will include an additional 4% convenience fee

Mail to: HBA PAC, 6100 W. Main Street, Maryville, IL 62062 –or- Fax to: (618) 343-6335 HBA Policy: Registration for an HBA Event is considered confirmation of your participation and

will be invoiced if cancellation is not made within 3 days of the event.

A copy of our report is (or will be) available from the State Board of Elections, Springfield, IL

Hear from local Congressmen about the issues effecting our industry, businesses and the work they are doing for us in DC.

Congressman John Shimkus

Congressman Mike Bost

Congressman Shimkus is

a senior member of

the House Energy and

Commerce Committee.

Chairman of its

Subcommittee on

Environment and the

Economy.

He also serves on the

Energy and Power;

Health; and

Communications

Technology

Subcommittees.

Congressman Bost is on

the House Committees

for Agriculture,

Transportation &

Infrastructure and

Veteran’s Affairs.

He also serves on the

Conservation &

Forestry; General Farm

Commodities & Risk

Mgmt; Highways &

Transit; Railroads,

Pipelines & Hazardous

Materials; Water

Resources &

Environment; Economic

Opportunity; Disability

Assistance & memorial

Affairs Subcommittees.

5pm ~ Thursday, August 18th

Bella Milano 455 Regency Park, O’Fallon

8

Under the Fair Labor Standards Act (FLSA), which originally introduced the concepts of a 40 hour work week, a minimum wage, and “time-and-a-half” overtime pay, the Department of Labor is changing the rules for overtime exemptions. The new standards are outlined in the “Final Rule on Defining and Delimiting the Exemptions for Executive, Administrative, and Professional Employees.” The Final Rule updates the salary and compensation levels needed to exempt certain workers from overtime pay. The new rules are effective December 1, 2016. In order for an employee to be exempt from overtime pay, he or she must meet three conditions. These are often called “white collar exemptions.”

1. Salary basis test – meaning that a worker is paid on a salary basis rather than hourly.

2. Salary level test – meaning the worker’s salary falls within a certain range.

3. Duties test – meaning the job involves exempt duties, including certain professional fields and various management or executive responsibilities.

The only requirement affected by the Final Rule is the salary level test. Any employee earning more than $913 per week (or $47,476 per year) will be exempt from overtime pay, provided they also pass both the salary basis and duties tests. The amount is currently $455 per week (or $23,660 per year.) Up to 10% of this standard salary level can include nondiscretionary bonuses and incentive payments such as commissions.

The other major change is that this wage threshold will be automatically adjusted every three years, beginning on January 1, 2020.

Options for employers for responding to the Final Rule Employers may want to evaluate their payroll data and the needs of their business to decide if they should make any changes with compliance to the Final Rule. The following are general options and are not intended to be specific suggestions.

1. Make no changes – An employer can choose to make no changes to his/her employees’ pay or hours. They will continue to pay current salaries but will now include overtime after 40 hours for all employees

making less than $913 per week.

2. Raise salaries – An employer may choose to raise salaries above the $913 threshold for certain employees. If the employee meets the two other white collar exemption criteria, they would be exempt from overtime pay.

3. Reorganize workloads, adjust schedules or spread work hours – Distributing assignments to different employees may equalize the overtime necessary to complete projects.

4. Adjust wages – Changing a salaried worker to an hourly rate may prove more cost-effective.

Seasonality is not a factor and

"compensatory time" cannot be used to offset overtime from one week to the next.

Exceptions Sub-contractors control their own employees and overtime is not an issue with the general contractor. As always, be careful, to make sure they qualify as an independent contractor or you may be liable for other payroll issues as well as overtime.

At Diel & Forguson LLC, it is our job to make sure that you have the knowledge you need

to comply with the ever-changing rules and laws affecting you and your business. We are

here to answer questions and offer advice about your specific situation.

Kenneth R. Diel, CPA, CVA

O'Fallon, IL

852 Cambridge Blvd, Suite 100

O'Fallon, IL 62269 618-632-7574

St. Louis, MO

1200 South Big Bend

St. Louis, MO 63117

314-454-0438

Contractors Exempt from Overtime Pay? Maybe Not… Employers and need to know about these changes to overtime rules.

9

The St. Louis Regional Airport Wings & Wheels combined

all of their events into one day!

Our new Fall Home Show date and time is

Saturday - September 24th from 9 am - 4 pm

New Booth Costs: $225 to $375

HBA Fall Home Show Plan download the current floor plan at www.hbaswil.org

2016 Fall Home Show at St. Louis Regional Airport

8 Terminal Drive, East Alton, IL

(618) 259-2531

Exhibitor & Sponsorship

Packet Available at

www.hbaswil.org

ONE DAY ONLY EVENT!

10

Despite GDP again slowing in Q1, as has been the case for the past few years, the economic recovery

that began in July 2009 remains intact. The poor performance of the US economy from January through

March was almost expected, and the incoming employment, housing, and service sector data all point to

a modest economic pickup. GDP growth the rest of the year should average 2.2%, with growth in Q2

closer to 2.75% as the economy rebounds from a tough Q1. The combination of continued wage growth

and increased residential construction activity suggests that 2016 will probably improve as it progresses.

Despite weak energy prices, a continued strong dollar that has hurt manufacturing by making US

exports costly and imports cheaper, and a struggling agricultural sector, the rest of the economy is OK.

As long as the service sector and construction continue to expand and wages rise, the US economy will

continue to grow despite the headwinds it faces. Importantly, the labor market continues to strengthen,

voluntary quit rates are rising and are almost back to where they were before the Great Recession, the

number of involuntary terminations keeps falling, and job creation, while down from last year, remains

strong. At this rate, there will be little slack in the labor market 12 months from today. Lastly, passage

of the FY 2016 budget package has boosted economic activity as it extended some tax breaks and eased

spending caps on domestic and military spending, making fiscal policy pleasantly expansionary.

A definite economic bright spot in 2016 has been housing, and that is due to rising household formation.

After averaging well over 1.2 million annually from 1983 through 2006, household formation

plummeted to just 600,000 in 2014. Since then, it has been rising by about 1.2 million a year. Add to

this slightly improved access to credit, and housing starts should reach an annualized average rate of

1.19 million during the second half of 2016, their best level since late 2007, with new single-family

construction contributing at a pace of 810,000 units and multifamily adding 380,000. Despite being

severely constrained by a lack of inventory, pending home sales are strengthening and existing home

sales should rise by 3% annually, while home prices should rise by 5% annually.

As for inflation, it remains benign but shows signs of slowly rising from its current level. The dollar is

likely to strengthen slightly in the latter part of the year and oil prices appear to be rising, thus the two

trends that have exerted strong deflationary pressures on imports and energy respectively should

dissipate. Moreover, as the unemployment rate continues falling, labor shortages are becoming

increasingly widespread. This pushes up wage growth, which is definitely rising, albeit modestly, and

thereby boosts household spending. However, rising prices and wages will push the Fed to raise short-

term rates by one-quarter-of-one percent as early as July, and certainly by November or December.

Long-term rates have bottomed and 10-yr Treasuries will end the year at close to 2% as the economy

strengthens.

In short, the economy continues to grow modestly.

Short-term interest rates are likely to start rising,

wages are rising, and residential construction activity

looks to continue to slowly strengthen as we go into

2017. Most critically, continued solid job creation

will keep consumer spending up and the likelihood

of a recession during the next six months, close to

zero.

The Economic Forecast for the Second Half of 2016:

Decent but Nothing Remarkable

Elliot Eisenberg, Ph.D. is President of

GraphsandLaughs, LLC and can be reached

at Elliot@graphsandlaughs.net. His daily 70

word economics and policy blog can be seen

at www.econ70.com. You can describe to

have the blog delivered directly to your

email by visiting the website or by texting

the word “BOWTIE” to 22828

11

June 2016 Renewed Members

Joe Lanahan Construction Services, Inc.

Midwest Block & Brick

SunWise Electric & Solar, Inc.

Remodelers Council

J.T. McDermott Remodeling Contractors

LS Building Products

Mosby Building Arts

June 2016 New Members

Aaron Thieret

Earthworks 4287 N Hwy 51

Perryville, MO 63775

Phone: (573) 547-9097

Email: aaron.thieret@earthworksstone.net

Consumer Events Page

Green Building Council

HBA Members Page

Professional Women in Building

Remodelers Council

12

13

GOLF OUTING

FRIDAY, SEPTEMBER 30, 2016 TAMARACK COUNTRY CLUB, SHILOH

Check-in 11:30 am Shot Gun Start 12:00 pm

Golf - $75 each

Taste of Southwest IL

Food on the course provided by local restaurants

ANNUAL 5pm Happy Hour ~ 6pm Trivia

VFW Post 5691

1234 Vandalia

Collinsville

Trivia & Dinner $25 p/p

Thursday - November 3rd, 2016

Friday - October 14th, 2016

Proceeds to benefit the PWB Student

Scholarship & School Project fund.

$40 per individual - $200 per team of 5

Starts at 6pm St. Clair Bowl

5950 Old Collinsville Rd

Fairview Heights

14

Do you need a tool to help with: Marketing Selling your new home or remodeling project Promoting confidence in you & your company Resolving Customer Concerns Avoiding misunderstandings “Nit-Picking” Customers

Provide your Customers with an

Illinois Quality Assurance Builder Standards Book!

A Measurable Difference

The Illinois Quality Assurance Builder Standards

provides, new homebuyers and remodeling

homeowners a way to measure the quality of the

project against an industry approved set of standards.

These standards create a series of performance

standards that the builders and the homeowners can use

to communicate and understand one others'

expectations regarding the building or remodeling

project. The standards address the most prevalent

issues that arise between the builder and the customer

before the project, and, most importantly, after the

project is completed. All too often it is the undefined

expectations that create the majority of the problems

encountered in the building and remodeling processes.

The standards will help eliminate problems before the

project even begins.

Sample of an Issue in the QA book.

4.4 Cracks in Exterior Concrete Observation: Exterior concrete - sidewalks, porches, patios, drive- ways, etc. - are cracked.

Standard: Some random cracking of exterior concrete will occur and is to be expected. If settling causes cracks that exceed 1/4 inch width or 3/16 inch in vertical displacement, it is considered excessive.

Builder’s Responsibility: The builder is responsible for correcting only those cracks that exceed the standard. An appropriate joint or crack filler can be used and is acceptable for a crack up to 1/2 inch in width or vertical displacement.

Homeowner’s Responsibility: For aesthetic purposes, smaller cracks may be filled with a waterproof concrete caulk. While this may reduce the appearance of the crack, it should be noted that there will be a color and texture variance between the original concrete and the caulking.

Discussion: Driveways, patios, and sidewalks should have expansion and contraction joints which help to control surface cracking. Refer to definition number 5 on page 9.

Contained in the 200 pages of the QA Book are 22 section of the most prevalent issues encountered in the construction process. Each section contains numerous sub-sections of specific items. An example is the above 4.4 Cracks in Exterior Concrete.

Each 200 page book includes Quality Standards for the most prevalent issues that arise between the Builder/

Remodeler and the Customer.

Below is a sample of a common issue in Illinois, exterior concrete cracking. The standard is explained to de-

fine the expectations of quality craftsmanship for the Customer.

These books will help eliminate problems before the project even begins!

Only Members can buy these books!

$30.00 ea. + shipping & taxes

For more information or to order, contact Tracy Butler @ HBASWIL

6100 West Main Street – Maryville, IL 62062 or 618-343-6331 - tbutler@hbaswil.org

15

OFFICERS

President, Jeff Schmidt - RLP Development

1st Vice President, Dave Padgett - Padgett Building & Remodeling Co., Inc.

2nd Vice President, Joe Lanahan - Joe Lanahan Construction Services

Associate Vice President, Mindy Shafer - Wells Fargo Home Mortgage

Secretary, Jerry Yaekel, Jr. - Yaekel & Associates, Inc.

Treasurer, Robb Treat - Guaranteed Rate, Inc.

Immediate Past President, Chris Jones - C.A. Jones, Inc.

DIRECTORS

Jason Klein - Ameren Illinois

Michelle Null - Benchmark Title Company

Art Stumpf- AUTCOhome Appliances

Joel Keel - Custom Floors & More

Robert Dee Jr. - Homes by Deesign

Joe Knox - Copious Technologies

Beth Jacob - Jacob Sunrooms, Exteriors & Baths

Aaron Klemme - Klemme Construction

Jason Huelsmann - New Tradition Homes

Barbara Markham - RE/MAX Preferred, The Markham Network

Mike Rathgeb - Spencer Homes

Mark Vogt - Vogt Builders, Inc.

OFFICER REPRESENTATIVE DIRECTORS

Ken Diel - Diel & Forguson

Mark Fulford - Fulford Construction

Chris Matteo - Fulford Homes, LLC

John Snapat, CAPS, CGR - Fulford Home Remodeling

Ron Padgett - Padgett Building & Remodeling

Norm Etling - Village of Shiloh

2016 HBA Home Show Corporate Sponsors

2016 HBA Gold Annual Sponsors

2016 HBA Silver Annual Sponsors

2016 Home Builders Association

Platinum Annual Sponsors

2016 HBA Bronze Annual Sponsors

16

6100 West Main Street

Maryville, IL 62062-6688

Office (618) 343-6331

Fax: (618) 343-6335

Email: hba@hbaswil.org

WWW.HBASWIL.ORG