IREM and CCIM Take Key Commercial Real Estate Issues to Capitol Hill

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240 Meetings with Legislators from 28 States Focus on Carried Interest, Internet Sales Tax Fairness, and Lead Paint in Commercial Buildings


Editors’ Note:
Contact Sharon Peters for copies of briefing papers on the key issues focused on during the Capitol Hill meetings.

(Chicago, April 19, 2013) –Some 320 members of the Institute of Real Estate Management (IREM) and the CCIM Institute recently visited Capitol Hill to raise awareness of key issues affecting the commercial real estate industry. IREM and CCIM Members representing 28 states and the District of Columbia held 240 meetings with their respective senators, representatives and their staffs to raise awareness of the industry’s legislative positions on:

  • Carried Interest
  • Internet Sales Tax Fairness
  • Lead Paint in Commercial Buildings

CARRIED INTEREST

Issue Highlights:
A carried interest is designed to act as an incentive for a general partner to maintain and enhance the value of a given real estate property so that the operation of the property is a value-added proposition. The carried interest of the general partner(s) historically has been taxed at capital gains rates, just as the limited partners’ gains are taxed at capital gains rates.

IREM and CCIM Position: IREM and CCIM Institute oppose any proposal that would eliminate capital gains treatment for any carried interest of a real estate partnership.

Action Urged: IREM and CCIM Institute urge Congress to oppose an increase to the tax treatment of carried interest for real estate partnerships. The real estate sector continues to recover from a devastating recession. Making changes that would further hinder the flow of capital into real estate markets will prolong the weakening of our economy.

INTERNET SALES TAX FAIRNESS

Issue Highlights:
Under current law, purchases made online are subject to sales tax through what is known as a use tax. Consumers who live in states with a sales tax are legally obligated to report and pay sales taxes on ALL purchases made online, although the majority of them are unaware of this obligation, and very few pay this sales tax. Conversely, brick and mortar retailers are required by law to collect the tax on behalf of the state. This inequity is putting some stores out of businesses because online retailers are not paying the same rate in taxes.

IREM and CCIM Position: IREM and CCIM support consistent state/local sales/use taxes for economically equivalent transactions in the state or locality in which the goods are delivered. IREM and CCIM support a level playing field for local in-store retailers and remote merchants (including Internet merchants). IREM and CCIM believe that local and state governments should enforce existing taxes rather than create new ones. IREM and CCIM firmly oppose any new programs that would impose taxes on the cost of such services, such as fees and other costs associated with the purchase and ownership of real estate.

Action Urged: IREM and CCIM Institute urge Congress to support H.R. 684 and S.336 to modernize our nation’s tax policy and provide equity between online and brick-and-mortar retailers.

LEAD PAINT IN COMMERCIAL BUILDINGS

Issue Highlights:
The Toxic Substance Control Act includes a provision that requires the EPA to create and implement guidelines for renovation activities that may create a risk of lead exposure in public and commercial buildings constructed before 1978. After being subjected to lawsuits about the EPA focusing only on residential properties, the EPA is now working on the commercial issue.

IREM and CCIM Position: IREM and CCIM support broad regulatory reform such as that pursued by Congress and the concept of greater accountability of agency rule makers to elected officials. As well, both organizations support a viable substitute to the legislative veto considered unconstitutional by the Supreme Court and also endorse the need to shift the burden of proof in justifying agency regulations toward the agency.

Action Urged: IREM and CCIM Institute urge Members of Congress to be increasingly aware of capricious rule-making. As well, the organizations and are now working to identify senators and congressmen willing to issue a letter asking the EPA to ensure that it has identified an actual hazard and its target population before proceeding with any such regulation.

ABOUT THE CCIM INSTITUTE
The CCIM Institute is an affiliate of the NATIONAL ASSOCIATION of Realtors, (NAR). The Institute confers the Certified Commercial Investment Member (CCIM) designation through an extensive curriculum and experiential requirements. The CCIM designation was established in 1969 and is recognized as the mark of professionalism and knowledge in commercial investment real estate.

Membership includes qualified professionals in all disciplines of commercial investment real estate, including brokers, leasing professionals, investment counselors, asset managers, appraisers, corporate real estate executives, property managers, developers, institutional investors, commercial lenders, attorneys, bankers, and other allied professionals. Of the approximately 125,000 commercial real estate practitioners nationwide, 9,000 currently hold the CCIM designation, with an additional 6,000 candidates pursuing the designation.

Founded upon the principles of education, networking, and ethical practice, the CCIM Institute, as an affiliate of the 1.2 million-member NATIONAL ASSOCIATION of Realtors, helps shape policy and legislation affecting the industry and safeguards the interests of commercial investment real estate practitioners.

ABOUT THE INSTITUTE OF REAL ESTATE MANAGEMENT
The Institute of Real Estate Management (IREM) is an international community of real estate managers dedicated to ethical business practices, maximizing the value of investment real estate, and promoting superior management through education and information sharing. An affiliate of the National Association of REALTORS, IREM is the home for all industry professionals connected to real estate management – and the only organization serving both the multi-family and commercial sectors.

We believe that good management matters, and that well-managed properties pay dividends in terms of value and in the quality of life for residents, tenants and customers. We believe in professional ethics. We believe in the power of knowledge and the importance of sharing it.

IREM offers a variety of membership types for professionals of every experience level, from on-site managers to high-level executives. Our credentials, earned by meeting high standards of education, experience, and ethical business practices, include: Certified Property Manager (CPM), Accredited Residential Manager (ARM), Accredited Commercial Manager (ACoM), or Accredited Management Organization (AMO).

Since 1933, IREM has set the standard for best practices in real estate management. Today, IREM membership includes nearly 18,000 individuals and 560 corporate members. To learn more about the IREM and its chapter network, call (800) 837-0706, ext. 4650 (outside the U.S. call (312) 329-6000) or visit www.irem.org.