March 2015 reporter

Volume 8, No. 3 • March 2015

4410 Fairway Boulevard • Wichita Falls, TX 76308 • P: 940.692.2211 • F: 940.692.2214 www.nthba.com Dates to Remember • March 4, 2015 TAB Rally Day • March 5 - 6, 2015 TAB Winter Board Meeting • March 15, 2015 Deadline for Parade of Homes Entries.

• May 1, 2015 Deadline for Scholarship Applications • May 7, 2015 Family Night • June 5, 2015 Parade of Homes Kick-Off Lunch & Washer Tournament • June 6-14, 2015 Parade of Homes.

• July 28-31, 2015 TAB Summer Board Meetings • July 29-30, 2015 Sunbelt Builder Show (Grapevine, TX) Please remember to donate to HOMEPAC and BUILDPAC. THANK YOU

FOR BEING A 2015 SILVER SPONSOR FOR THE NORTH TEXAS HOME BUILDER ASSOCIATION

From the President Friday February 20th the temperature was 75 with a forecast of snow and wintry weather on Sunday.

Welcome to North Texas weather.

Members of the North Texas Home Builders Association attended the Chamber of Commerce’s Annual Membership Meeting at the MPEC on January 27th. All the speakers had a positive message for the future of Wichita Falls. Big things are in store for Education in 2015. WFISD spoke of a new bond proposal that would focus on creation of a new Career and Technology Education Center. The proposed site would be located at the corner of Iowa Park Road and 287/I-44. Vernon College spoke of cooperation between WFISD, MSU and industry to expand its programs to meet the needs of our surrounding area. MSU president Jesse Rogers stated the Lone Star Conference would continue and expand in the next few years. MSU future projects include a new 500 bed dormitory, expansion of the Fain Fine Arts building and plans for a new health and human services building to the tune of $100 million worth of expansion.

Judge Woody Gossom stated that the Sprague jail facility on US 287 would expand to help the nearly 600 inmates that Wichita County houses each day.

He stated the cost $10-$14 million.

Wichita Falls City Manager Darron Leiker updated the audience on where the city stands with its water situation as it enters its fifth year of drought. The most recent analysis indicates that with no more flow into our water supply and record high temperatures, we have water to last until November 2019. The city through conservation, direct potable reuse, indirect potable reuse and bringing Lake Kemp back online will insure our water supply as we battle through this record drought.

The city is still in early stages of feasibility testing on the Lake Ringgold project and plan to continue forward by putting it on the top of the list of the 2016 priority project list to bring before the Texas Water Development Board.

This will help the future outlook on water for younger generations. The Lake Ringgold project is projected to take 20-30 years for completion.

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Speaking with City Manager Leiker, attending the Region B Water Planning meeting and being involved on the TAB Water Task Force Committee has led me to believe everything is being done to make it through this drought. The analyses that have been done for this region indicate there is only a 1% chance of running out of water. Those are odds that we can live with, but still PRAY FOR RAIN. Rally Day will be March 4th in Austin. Your NTHBA delegation will be the biggest that I have seen attending the event. Lt. Governor Dan Patrick will be the keynote speaker addressing attendees at Rally Day at 10:30 A.M on the South Steps. We plan on visiting with Senator Craig Estes and Representative James Frank to discuss the many issues that affect our industry.

March 5th & 6th will be the TAB Winter Board Meetings. We will get a thorough report on what is going on at the State level.

I also wanted to report that at the February Board of Directors Meeting, Michael Grassi with Classic Builders was appointed to fill the remainder of one of the builder director’s positions that was recently vacated. Congratulations Michael!

Renewals Guarantee Title................................Kolter Lukert

Thanks for Renewing!

Calendar of Events Rally Day...................................................................March 4, 2015 .......................................................................................Austin, Texas TAB Winter Board..........................................March 5 & 6, 2015 Meeting........................................................................Austin, Texas Membership Meetings &.....................................March 10, 2015 Education Committee Meeting.....................................10:00AM

March Birthdays Jason Hucton..........................................................1 Jay Bitsche...............................................................4 Lane Landes............................................................7 Rebecca Lammers...............................................14 Donnie Park.........................................................15 Wayne Pharries....................................................15 Teri Gibson...........................................................15 Jose Garcia............................................................19 Tim Sawyer............................................................22 Jennifer Blackwell................................................23 Steven Hinson......................................................31

Happy Birthday!

Did you know?

Every year on March 17, the Irish and the Irish-at-heart across the globe observe St. Patrick’s Day. What began as a religious feast day for the patron saint of Ireland has become an international festival celebrating Irish culture with parades, dancing, special foods and a whole lot of green. Happy St. Patrick's Day!

Publication & Communication...........................March 10, 2015 Committee Meeting........................................................11:00AM Parade of Homes & Special................................March 11, 2015 Events Committee Meeting...........................................10:00AM Government Affairs..............................................March 11, 2015 Committee Meeting........................................................11:00AM General Membership...........................................March 12, 2015 Meeting...............................................................................11:30AM Budget & By-Laws.................................................March 17, 2015 Committee Meeting...........................................................9:30AM Board of Directors...............................................March 18, 2015 Meeting...............................................................................11:00AM

2014 /2015 Officers & Directors President – John Harmon Vice President – Eddie Holcomb Associate Vice President – Tim Sawyer Treasurer – Martin Litteken Secretary – Randy Schaffner Immediate Past President – Barney Brock Builder Directors Michael Grassi 1yr Steven Hinson1yr David Bedingfield 2yr Steve Lane 2yr

Associate Directors Sharon Tucker 1yr Cindy David 2yr

State Director - Barney Brock Alternate State Director - Steven Hinson Life Director - Chuck Dennis Life Director - Jose Garcia Executive Vice President - Teri Gibson

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Leggett Plumbing has been serving the Wichita Falls and its surrounding counties for over 12 years.

Clint Leggett is native to Holliday, TX., where he currently resides with his family. Clint takes pride in conducting his business in a professional manner with integrity and puts customer service as the number one priority.

Leggett Plumbing does both residential and commercial jobs.

Leggett plumbing works on new construction, existing homes and commercial buildings using only quality materials, name brand products and parts. No job is too large or too small. If you want the job done right and service after the sale Leggett Plumbing is the company to call.

Continues on page 5

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Scholarship Applications

Government Affairs – The government affairs committee is in the process of planning a washer tournament. Cost will be $50.00 per team and it will be double elimination and is tentatively set for June 5, 2015 from 1 – 4 P.M in conjunction with the Parade of Homes kick-off lunch. We will inform you when final details are available and start soliciting for teams.

Lines of communication will be through Facebook, Email, the Web Site, the Reporter and the old fashion way, telephone.

Young Professionals Council – The Young Professionals council had a great social hour at Guarantee Title Company. Thank you Guarantee for opening your place of business to hold this event and providing beverages and thank you Dennis Company for providing the snacks.

During this social gathering they did take some time to conduct the business of searching for a venue to hold a fund raising event. Their goal is to raise funds to be self-sustainable while representing the NTHBA locally and at the state level.

Do you know someone who is graduating this year and will be preparing to go to college or a career technical school?

Do you know someone who is already attending a college or career technical school?

The NTHBA understands how hard it is to secure funds to achieve the education or training required to be successful in the home building industry. The NTHBA will be awarding scholarships this year to those who plan to pursue a career in the home building industry and meet the qualifications and requirements put forth by the NTHBA Scholarship Committee.

To obtain an application with the qualifications and requirements visit our web site at www.nthba.com or call the NTHBA office at 692-2211 and make arrangements to receive an application.

Deadline for applications is May 1, 2015.

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Lance Cannedy NTHBA Member since 1972 5

Home & Garden Show 2015

Speaking to area home builders Gustafson describes area real estate market as steady

Several of the NTHBA members were among the vendor booths at the sold out 2015 Arts Alive Home & By: Lee Grace Garden Show sponsored by the Kemp Center for the Arts. Teri Gibson along Steady and consistent� is how with Cassie Ahearn from Christmas In Realtor Ashton Gustafson Action volunteered on Friday February described the Wichita Falls area 20th to help distribute packets and real estate market to the members direct vendors to their booth locations and anything else of the North Texas Home Builders they were asked to do. After receiving their packets, Association at the February John Harmon, Ashton Gustafson, and Rhine are shown after vendors were able to begin setting up their booths for the Membership Luncheon held Kevin Gustafson’s presentation to the weekend. The list of vendors participating who are Thursday, Feb. 5, at the Kemp Home Builders Association. members of the NTHBA included: American National Center for the Arts.

Bank, Athena Roofing & Exteriors, Atmos Energy, Breegle “Looking at our market in the rear view mirror, year Abbey Carpet & Flooring, Builders Wholesale, Christmas after year it is about the same,� said Gustafson, “pretty In Action, Door Systems of Wichita Falls, Energy Cut, consistent.�

Ferguson-Veresh, First Bank, Lowe’s, Texoma Community Gustafson, who is co-owner with Ann and Denny Credit Union, Times Record News, Waggoner Carpet Bishop of Bishop Realtor Group, added that while area One and Woodco Supply. This annual event gives area sales and days-on-the-market have remained fairly businesses the opportunity to promote themselves as constant during the past several years since the national well as familiarize and sell their products to the real estate bubble bust in 2008, 2014 did show a 27 community and surrounding area attendees. percent drop in the number of transactions when The Home & Garden show Continues on page 7 also promotes the local artist and their work of art whether it is canvas painting, water Helping Build Our Community colors, sculptures, leather Since 1907 work, blown glass or stained glass to name a few types of art that was displayed. The event had many informative booths ranging from information about non-profit organizations like Interfaith Ministries to Riley’s Project which encourages the public to be aware and learn what to do in case of a rattlesnake   bite. Several classes were offered throughout the weekend to teach how to preserve jelly, can your garden vegetables, raise chickens and even how to grow a garden.

The MPEC continued to stay full of people scurrying about during the Home Member FDIC & Garden Show. This event is the largest fund raising event for the Kemp Center for the Arts according to Carol Sales, Director Kemp Center for the Arts / Always Remember to do Business with Association Members!

Marketing & Special Events. Wichita Falls is fortunate to have an organization BRYAN WAGGONER willing to fight to keep the Art world alive and promote it for 3907 Kell BoulevarG ‡ WLFKLWD )DOOV ‡ Texas 76308 future generations to be able learn (940) 691-3641 Continued on pg 12 about the history and become )D[ ‡

E-Mail bryanl@waggonercarpetone.com artist themselves.

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Continued from page 6

compared to 2006. In 2006 there were 2060 homes sold in the MLS and in 2014 there were 1404 sold.

Gustafson also said that data is beginning to favor the landlord when it comes to Wichita Falls real estate. He noted, “Zillow named Wichita Falls the best rental market in the United States in 2014.�

He added that Bishop Realtor Group can attest to that fact as the real estate agency has been selling properties to investors from throughout the country. “The military market has shifted around the United States and has affected us on a local level. Many military families had challenges with selling their homes in previous areas during the 2005-2008 real estate bubble. This has caused many to show up to our area looking to rent instead of potentially purchasing a home.�

However, he noted that in today’s very competitive rental market, it is much cheaper to buy a home than to rent one.

Mortgage rates with local lenders continue to hover near their record lows.

He also said newer homes, those built in the last 15 years, have gained momentum when compared to older homes sales. “In 2013, 40 homes were sold for more than $300,000. Of these, 18 (or 45 percent) were built after 2000. In 2014, 62 percent of the homes sold for $300,000

or more were built after 2000.

He also noted that the current MLS inventory shows a fairly consistent number of homes available in all price ranges from $100,000 up to $400,000. “To recap, sellers are being squeezed. Buyers today have many choices. Updated homes priced well can move quickly. A home without updates must offer aggressive pricing to sell in today’s market. However, price adjustments can cure all seller illnesses. ‘Would they rent?’ is a typical question we get on our for sale signs. While the local economy could use a shot in the arm, the real estate market should just ‘stay the course.’ And, of course, with rain comes confidence!�

Delinda Dodd Mortgage Team Member

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Texas Association of Builders - 2015 Legislative Priorities

BOBBY TEAGUE, ASSISTANT DIRECTOR, COMMUNITY DEVELOPMENT / BUILDING OFFICIAL, has informed the NTHBA he will be putting together the review committees for the 2015 ICC Code Adoption. The goal is to start the committee meetings the last week of April and stagger them into the third week of May. If you have not asked to be put on a list to serve on these committees please call or email the NTHBA office with your information and it will be forwarded to Bobby Teague so he is able to appoint you to a committee if there is space available.

New Home permits for 2015: January – (2) - both from NTHBA builder members February –(2) – one from NTHBA builder member and the other from Habitat for Humanity

The scope of issues that impacts the home building industry is far-reaching. Fees and taxes, adequate infrastructure, property rights, tort reform, workforce education, and environmental impacts are only a few areas in which the residential construction industry is impacted by the decisions of policy makers at the local, state and national levels. As the 84th Legislative Session progresses, a myriad of issues will dominate our agenda, including: • • • •

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Securing a stable funding source for transportation infrastructure.

Preventing unreasonable energy code mandates.

Providing for condominium unit owner notice and approval prior to the filing of lawsuits.

Clarifying the definition of certain rural areas for TDHCA financial assistance purposes.

Addressing potential TWIA shortfalls.

Protecting private property rights.

Supporting property and business tax reductions, and maintaining fairness and uniformity in the appraisal process for all property owners.

Increasing access to career education and technical training.

Securing a Stable Funding Source for Transportation Funding While Texas’ population, vehicle traffic and highway construction costs have skyrocketed in recent years, revenue under the current funding system is insufficient and remains in a constant state of decline relative to the unprecedented growth in the state. A deteriorating Texas road system not only harms Texas travelers and the economy as a whole, it also has a direct effect on the future of the housing development and construction industry. In November 2014, Texans overwhelmingly voted in favor of Proposition 1, which provided some additional funding for our roads. Texas’ transportation funding challenge, however, has not been solved by Proposition 1’s passage. Therefore, our association has made additional long-term funding for the state’s highway fund a priority this session. This includes: Continues on page 9

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• •

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Ending diversions from our highway funding for issues not directly related to building and maintenance.

Supporting legislation that dedicates a significant portion, if not all, of motor vehicle sales tax receipts to the highway trust fund.

Preventing Unreasonable Energy Code Mandates With the ever increasing inflexibility and extraordinarily high levels of energy codes as brought about in large part by the actions of a select group of manufacturers, municipalities and out-of-state interest groups, housing affordability and code compliance are significantly suffering. To further complicate the situation, the cost savings of energy efficient features continue to be severely undervalued in the appraisal process, resulting in delayed closings and lost sales due to price increases. As a result of these overly rigid energy mandates, which lack market justification and significantly increase the price of homes in some of the most cost-sensitive markets, it is necessary to review all solutions and alleviate this mounting problem.

Solutions which increase compliance rates and allow for more cost effective implementation include: longer review cycles to allow for more comprehensive training and consumer education; generating a sensible energy code performance path to give homeowners and builders more energy efficient options; and creating a state advisory board of industry professionals and energy stakeholders to provide much needed guidance on proper code implementation. Intelligent and rational energy code policy will result in significantly better compliance rates and effective price-sensitive applications, benefiting all Texans, not just a few select manufacturers and interest groups.

Providing for Condominium Unit Owner Notice and Approval Prior to the Filing of Lawsuits Over the past decade, Texas has experienced significant growth in the condominium form of ownership for new residential development. This form of ownership enhances product density, supports active low maintenance lifestyles, and applies to single family homes as well as high-rises and apartments. Additionally, condominium ownership is an affordable, less expensive alternative for many homeowners.

Currently, the Texas Uniform Condominium Act allows representatives on the board of the condominium association to make decisions affecting more than one unit without meaningful input or approval from the actual condo unit owners.

Unfortunately, this “loophole” has been exploited by some to initiate construction defect claims without the approval of the condo owners. Similar statutes in Colorado, Nevada and California have led to an increasing number of construction defect disputes that have prevented stable and healthy condominium development in those states.

Legitimate construction defect claims are understandable.

The concern, however, lies with the ability of a condo board to file claims without properly notifying or seeking approval from Continues on page 10

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Continued from page 9

protection of property rights is one that warrants much needed attention, including:

potentially affected unit owners.

Construction defect disputes can • have serious implications for condo unit owners such as lowered market values and an inability to sell or refinance during the pendency of the dispute. Requiring proper notice and owner approval • prior to the prosecution of a construction defect claim will help ensure that unit owners are provided with adequate information to make an informed decision that affects their private property, protect unit owners from resale and refinance limitations due to unknown • cases involving their property, and prevent lawsuit abuse against a developer or builder. • Clarifying the Definition of Certain Rural Areas for TDHCA Financial Assistance Purposes By expanding the definition of “rural areaâ€?, as used by the Texas Department of Housing and Community Affairs (TDHCA), certain areas that are rural in character and size will be able to request consideration for projects that currently do not meet the definition. This will allow rural areas that are not currently classified as such to apply for financial assistance administered by TDHCA. Addressing Potential TWIA Shortfalls As the state's insurer of last resort for wind and hail coverage in the fourteen coastal counties and parts of Harris County, the Texas Windstorm Insurance Association (TWIA) provides wind and hail coverage in the numerous cases where insurance companies exclude such coverage from coastal residents’ homeowners and other property insurance coverages. Over time, as private market coverage has waned, more and more Texans have been forced to seek windstorm insurance from TWIA. Unfortunately,TWIA does not have enough cash on hand to cover all losses that could result if a catastrophic storm hits the more populous areas along the Texas Gulf Coast. The Texas Legislature must address this issue in a comprehensive manner, including incentives to bring private insurance coverage back into the market in a substantial way, as well as funding TWIA reserves in a fair, consistent and even manner. Ensuring adequate windstorm coverage along the Texas coast is a benefit to all Texans in the long run.

Protecting Private Property Rights Isaiah 7:14 One of the primary principles upon which Texas was built is the concept of individual property rights. Since its inception, our association has made defending those rights from unreasonable, or sometimes even illegal, regulations a core tenet. Unreasonable regulations come in many forms ranging from regulatory actions and zoning practices that arbitrarily diminish the value of private property by imposing overreaching restrictions or fees on its reasonable use, to actual “takings� and condemnation actions. As we enter the 84th Session, the

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Treating local property owners fairly and equitably during the imposition of land use restrictions and regulations that significantly limit an owner’s full and reasonable enjoyment of their property. This includes a property owner’s rights in the proper use and enjoyment of their own trees, regardless of the jurisdiction.

Supporting strict limits on the extension of municipal ordinance and regulations to the extraterritorial jurisdiction (ETJ) outside of a city’s incorporated areas where property owners do not receive city services or have the right to vote for city council members.

Addressing issues where local governments have duplicate platting requirements in ETJs. Opposing attempts to force homeowners to install residential fire sprinklers in their homes, which add thousands of dollars to the price of a home and require significant maintenance to operate properly.

Continues on page 11

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Supporting Property and Business Tax Reductions; Maintaining Fairness and Uniformity in the Appraisal Process for All Property Owners This session, several proposals have been filed to adjust the current tax system. Of those proposals, TAB strongly supports those that provide relief for both residential and business taxpayers. Property tax relief will allow Texans to maintain more control over their purchasing power for home buying; reducing the business franchise tax will allow home builders to better serve the housing and employment needs of the state’s growing population through more investment in property development and construction projects.

Additionally, TAB is working with other stakeholders in the real estate industry to defend the Texas Constitution’s guarantee of equal and uniform taxation, and resist efforts to impose mandatory sales price disclosure when a property is purchased. The Texas Constitution requires that all property must be taxed at market value and that that the taxes be equal and uniform. To that end, TAB believes that all property holders, whether they be residential or business owners, have a right to challenge their respective property appraisals.

As a variety of tax proposals are debated, it is imperative that any changes to the current tax system do not place an unfair burden on the home building industry, due to the fact that the cost and availability of housing is significantly impacted by regulatory barriers and taxes. In order to maintain a prosperous home building industry in Texas, it is imperative to keep in mind the impact various tax proposals will have on housing affordability. To that end, TAB advocates: • •

Making the franchise tax reductions from last session permanent.

Considering changes that will result in lasting property tax relief without unduly burdening the Texas real estate industry.

Increasing Access to Career Education and Technical Training Over the next five years, 20 percent of skilled workers in the construction industry will retire. It is critical to the Texas economy and the business community that students have the opportunity to learn carpentry, welding, electrical, plumbing, and other skills that can place them into the workforce – in well-paying jobs – as high school graduates.

In 2013, the Texas Legislature passed HB 5 that allows students to work toward college credits and industry certifications/licenses so that they can be better prepared to enter the workforce upon graduation from high school.

School districts across the state are working with stakeholders in their local communities – through businesses, education partners, and local workforce development boards – to implement HB 5. In order for the promise of this law to be fully

met, however, some issues must be addressed. These issues include funding for job training facilities and programs, and ensuring an adequate number of school counselors to assist students in determining their curriculum, whether it be career training or college prep.

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WFISD Unanimously put School Bond Election on May 9th ballot The Wichita Falls ISD has been working extremely hard over the past months to propose a $59.5 million bond to citizens of Wichita Falls. After last years failed effort to pass a bond for a new Career Technology Education Center along with new high schools, renovation of middle schools and other proposed changes for school campuses the WFISD have come up with a new bond that was unanimously voted 6-0 to be placed on the May 9, 2015 election ballot.

The bond will provide the community with a CTE Center ($35.7 million), additions and renovations at all three junior high schools ($25 million), security improvements at existing facilities ($500,000), technology infrastructure improvements ($500,000), and Memorial Stadium parking and restroom improvements ($1.75 million). The total cost of all projects is $63.5 million. However, WFISD board members will dedicate $4 million from the district’s fund balance toward the projects, which will lower the bond cost for voters to $59.5 million.

Passage of the bond will create an additional tax impact of $6.99 per month for community members who own an average sized home appraised at $98,958. The current two-pronged WFISD tax rate of $1.135 recently dropped from $1.205 when WFISD paid off old debt. The current rate of $1.135 per $100 valuation ranks as the lowest tax rate among six local school districts. . Even with the proposed increase after the bond’s passage, WFISD’s higher tax rate of $1.21982 will continue to rank at the bottom among its neighboring districts. Property taxes for citizens 65 years or older with homestead exemptions are not affected by any tax increase associated with this bond.

Board members sought a CTE Center site that had high visibility, was accessible and large enough for today’s needs and for growth, could be affordably developed and was reasonably priced. It also had to be negotiated in a contract that included the 110-day option to decline the purchase if the site would not be needed after all. The two sites are located at 1526 Iowa Park Road and 1101 Central Freeway at the juncture of Highway 287 and Interstate I-44. The area has “almost the highest traffic count of anywhere in the city,” according to Realtor Bobby Schaaf, who highlighted the benefits of the site to board members in the noon special session February 20th. The price for the two sites was $1.40 per square foot, Mr. Schaaf said, compared to the $9.75 per square foot that it would cost the district to purchase land in a retail environment, such as near Lowe’s. The district was opting for an affordable $1.1 million total purchase compared to a $5 million total purchase in a retail area, he said.

WFISD is championing the need for the bond projects as part of its district goal of preparing its students to be lifelong learners, according to Corgan Associates’ Steve Halsey in a presentation to board members Thursday.

The construction of a Career and Technical Education Center, which is at the centerpiece of the bond, will give WFISD the ability to deliver the career education endorsements

required by House Bill 5.

District officials are collaborating now with community members, businesses, industry, Vernon College and Midwestern State University to determine the exact programs to offer at the career center.

By using bond funds to also renovate and enlarge the junior high schools to include sixth-graders, the district will complete its transition to middle schools. The middle school feeder program will complement the new initiatives at the high schools, Halsey said.

Board member Kevin Goldstein said the mindset of House Bill 5 had changed the way schools must deliver education, which was driving the need for the CTE Center. “We have to do it,” he said. “There’s no doubt about it. It will be a tremendous benefit over the career center we currently have.” Even though WFISD is the largest district in the area, it spends less on improving its schools than surrounding districts, Goldstein said.

Neighboring school districts all “have something new,” he said.

“I’m excited about the future of Wichita Falls for what they’re going to receive. I fully support this bond and am looking forward to May 9.”

Board member Bill Franklin said the bond, which was vitally important to the community and students, had been vitally important to him when he ran his election to sit on the school board. This bond will re-energize the community because it will help provide a skilled workforce that industry needs, he said. “It is a tax increase, but it is a small tax increase. It’s an extremely small price to pay for better education.”

To read full stories on the February 2oth and February 26th WFISD special sessions regarding the CTE Center, go to our web site at www.nthba.com and you can find them in the quick links section. Don’t forget to VOTE on May 9, 2015. Items on the ballot are electing a Councilor At-Large, Councilor District 1, and Councilor District 2 and the SCHOOL BOND.