Top Legislative News

Fluorescent T12 Ballast Manufacturing Update
Americans with Disabilities Act Update on New Regulations
Tax Extenders Update, July 2010
Status of Tax Extenders Bill
Final Rule – Lead Based Paint

Fluorescent T12 Ballast Manufacturing Update
According to the National Lighting Bureau, the July 1, 2010 date marks the last step of a multi-step phase-out plan that began on July 1, 2005, the date when ballast manufacturers could no longer sell T12 magnetic ballasts for use in new fixtures with full-wattage T12 lamps.   March 31, 2006 was the last day lighting-fixture manufacturers could incorporate the ballasts in new fixtures with full-wattage T12 lamps.  And on July 1, 2010, the manufacturing of T12 magnetic ballasts solely for replacement purposes that do not meet the new requirements will cease.

There are, however, exceptions to this rule, including ballasts designed:

• for dimming to 50 percent or less of their maximum light output;
• for use with two F96T12HO lamps at ambient temperatures of -20ºF and for use in outdoor signs; or
• labeled for use only in residential applications and have a power factor of less than 0.90.

On July 14, 2012, recently enacted DOE regulations will take effect that will also eliminate the T12 lamps that the ballasts operate.

To find out how to purchase energy efficient and compliant fluorescent ballasts, visit the link below:
http://www1.eere.energy.gov/femp/procurement/eep_fluor_ballast.html

For more information on this rule, please click on the link below:
http://www1.eere.energy.gov/buildings/appliance_standards/residential/fluorescent_lamp_ballasts.html

To see an article summarizing these regulations, see the link below:
http://www.aboutlightingcontrols.org/education/papers/2010/2010_lighting-upgrades.shtml

Back to Top

Americans with Disabilities Act Update on New Regulations
Monday, July 26 marked the 20th anniversary of the signing of the Americans with Disability Act (“Act”) of 1991.  Since the historic legislation became law twenty years ago, there have been a number of revisions and additions to the Act.  In July, 2010,   several changes were approved and published by the Department of Justice (“Department”) as a final rule to Title III.  Revised regulations that are pertinent to the property management and commercial real estate industry are:

• Adoption of the 2010 ADA Standards for Accessible Design:  The Department has adopted revised design standards and they have been harmonized with the Federal standards implementing the Architectural Barriers Act as well as with private sector codes that most States have adopted.

• Effective Date:  These revised regulations will become effective six (December 26, 2010) months after publication in the Federal Register.  Compliance with the new 2010 Standards will be required within eighteen months (December 26, 2011) of publication for new construction, alterations, and barrier removal.

• Element by Element Safe Harbor:  1991 covered facilities Standards are not required to comply with 2010 Standards until the project was subject to a planned alteration. 

• Service Animals:  The recent rule defines “service animal” as a dog that has been trained to do work or perform tasks for the benefit of an individual (including dogs that assist with emotional support) with a disability.  The rule states that other animals, wild or domestic, do not qualify as service animals.  Dogs that are not trained to perform tasks that mitigate the effects of a disability (including emotional support) are not service animals.  The rule allows the use of properly trained miniature horses as alternatives to dogs, with some limitations.  A miniature horse is not included in the definition of a “service animal.”

• Wheelchairs and Other Mobility Devices:  A two-tiered approach was taken regarding wheelchairs and other “power driven mobility devices” in the final rule.  Other powered mobility devices include a variety of devices, such as the Segway®, not designed specifically for people with disabilities.  Wheelchairs and other similar devices must be permitted in all areas open to pedestrian use.  Other “power driven mobility devices” must be permitted unless the covered entity can demonstrate that such use would alter its programs, services or activities, create a direct threat, or create a safety hazard.  The rule gives factors to consider in making this determination.

• Timeshares, Condominium Hotels, and Other Lodging:  The rule requires that timeshare and condominium properties that operate like hotels are subject to Title III; also lists facility requirements if not an inn, motel, or hotel to qualify as a place of lodging.  The rule limits obligations for units that are not owned or substantially controlled by the public accommodation that operates the place of lodging.  Such units are not subject to reservation requirements pertaining to the “holding back” of accessible units.  These units are also not subject to barrier removal and alterations requirements if the physical features of the guest room interiors are governed by their individual owners rather than by a third party operator.

• Egress and Access to Properties:  The 1991 Standards require the same number of accessible means of egress to be provided as the number of exits required by applicable building and fire codes.  The International Building Code (IBC) requires at least one means of egress and at least two accessible means of egress where more than one means of egress is required by other sections of the building code.  The changes in the 2010 Standards are expected to have minimal impact since the model fire and life safety codes contain the very similar requirements regarding the number of accessible means of egress.

The 2010 Standards include the requirements established by the IBC.  The IBC requires a building with four or more stories to have an evacuation elevator with standby power that can be used by people with disabilities in an emergency.  Exit stairways and evacuation elevators must be able to be used as an accessible means of egress in conjunction with areas of refuge or horizontal exits.  This change will have minimal impact due to fire and safety codes, already adopted in most states, containing similar requirements.

• Parking Spaces:  The 2010 Standards require accessible parking spaces to have signs that display the International Symbol of Accessibility.  Section 215.6, Exceptions 1 and 2, of the 2010 Standards exempt certain accessible parking spaces from this signage requirement.  One exemption is sites that have four or fewer parking spaces.  The other exemption is residential facilities where parking spaces are assigned to specific dwelling units.

• Handrails:  The 1991 Standards at sections 4.8.5, 4.9.4, and 4.26, and the 2010 Standards, at section 505 contain technical requirements for handrails.  The 2010 Standards add a new technical requirement at section 406.3 for handrails along walking surfaces and also give more flexibility than in 1991. Information on individual gripping surfaces, dimensions and diameters are located in sections 4.1.6(3), 4.26.4, 4.8.5, and 4.9.4 of the 1991 Standards and sections 505.3, 505.6, 505.7, 505.8, and 505.10 of the 2010 Standards.

Back to Top

Tax Extenders Update, July 2010
Since the early months of 2010, IREM legislative staff has been monitoring Federal tax issues, including the controversial carried interest tax language. During the recent recession, Congress focused on extending several tax cuts set to expire at the end of 2010. In order to fund these extensions, Congress sought other sources of revenue. Included in the original legislation, H.R. 4213, is a provision to change the tax treatment on carried interest from capital gains to ordinary income. Currently, the capital gains rate is 15% and would jump to 39.5% if changed to ordinary income rates. Changing the tax treatment of carried interest would be detrimental to commercial real estate because taxing the general partner at an ordinary income rate would create a disincentive for real estate investment, further damaging an already fragile market.

IREM members took this issue to their respective U.S. Congressional members during the 2010 Capitol Hill visits and participated in two concurrent Calls to Action urging elected officials to vote against this provision. Your efforts and consistent involvement in the carried interest tax issue have not gone unnoticed. In fact, because of your swift action, the Carried Interest language was completely removed from the "Tax Extenders" bill (H.R. 4213, later changed to “The American Jobs and Closing Tax Loopholes Act of 2010”) before it passed the U.S. Senate on July 20. We are very grateful that our elected officials listened to the voices of real estate and property management professionals, thus removing this damaging provision from the bill. Despite the carried interest tax issue being defeated four times, we believe this issue may arise again in the distant future. The IREM legislative staff will continue to monitor this issue and report back when necessary.

Back to Top

Status of Tax Extenders Bill
Over the last several months, IREM and CCIM Institute members have lobbied their members of Congress on the issue of tax treatment of carried interest. This issue is critical to both the recovery of commercial real estate, as well as the overall economic recovery.

On May 5, 2010, 265 members of IREM and CCIM Institute participated in a joint visit to Capitol Hill lobbying their federal lawmakers on issues affecting the commercial real estate industry. One of the key issues members presented to lawmakers was the issue of tax treatment of carried interest.

Under consideration was a piece of legislation known as the “Tax Extenders Package” (H.R. 4213). The bill aimed to extend certain Bush era tax cuts, as well as fund an extension of unemployment benefits set to expire. However, the legislation also carried a price tag of $127 billion, and would have added $84 billion to federal deficit over the next decade. In order to fund the extensions, Congressional members included $43 billion of tax increases- including a provision to change the tax treatment on carried interest from capital gains to ordinary income. This would raise the tax rate on carried interest from 15% to as high as 39.5%, adding further stress to the already overburdened commercial real estate industry.

On May 14, 2010 and June 2, 2010, IREM and CCIM Institute initiated a Call to Action, urging members to contact their federal lawmakers and ask them to oppose the carried interest provision in the Tax Extenders Package. Following the Calls to Action, IREM legislative staff received an overwhelming number of emails and phone calls from members who had contacted their legislators and expressed their opposition to the bill.

To date, lawmakers have held three votes on legislation concerning tax extensions and carried interest. Each attempt to pass the legislation has failed. IREM legislative staff would like to stress that the bill appears to be stalled, not defeated. It is likely that the measure will be taken up again.

IREM legislative staff would like to thank all who took action in contacting their members of Congress and expressing their position on the carried interest issue. Your actions have served to educate lawmakers regarding the negative economic impact posed by the legislation, preventing them from passing this dangerous bill. Thank you for taking action on this important matter.

IREM legislative staff will continue to update you on any future developments regarding this issue.

Back to Top

Final Rule – Lead Based Paint
On June 18, 2010, the U.S. Environmental Protection Agency (EPA) issued an amendment to the final Renovation, Repair and Painting Rule (RRP Rule), effective April 22, 2010. The RRP Rule requires that contractors who work in residential buildings built before the 1978 outlaw of lead based paint be certified by a government-approved trainer and follow particular safety rules. The ruling aims to reduce the amount of lead dust created during home renovation and repair, and affects tens of millions of homes, including multifamily units.

The RRP Rule requires that certified firms engaging in repair, renovation, or painting activities that disturb lead based paint be certified by the EPA. Some of the requirements outlined in the RRP Rule include information distribution to building occupants to notify them of the work being conducted, obtaining written certification from the adult occupant that the information has been received, postage of signs defining the work area, isolation of the work area by covering all ducts with taped down plastic, closing window and doors and covering them with plastic sheeting, covering the floor with taped down plastic, negatively pressurizing the work space, storing daily waste under containment that prevents the release of dust, disposing of the waste in a sealed bag approved by the EPA, placing all waste in a lined container and disposing of it into an EPA approved site, etc.

Following an outcry from industry groups including IREM and CCIM Institute, politicians, and homeowners, all claiming the new rule would drive up development costs and derail economic recovery, the EPA postponed enforcement of the RRP Rule’s certification requirement until October 1, 2010. The EPA will also not enforce against individual renovation workers who have applied to enroll in, or have enrolled in, a certification class no later than September 30, 2010. Renovators must complete training by December 31, 2010.

You may access the RRP Rule Memorandum issued by the EPA through the following link:
www.epa.gov/lead/pubs/giles_RRP_memo.pdf

IREM and CCIM Institute legislative staff will continue to monitor this issue, and will keep you informed of any new developments.

To view archived legislative news from 2009, click here.

To view archived legislative news from 2008, click here.

To view archived legislative news from 2007, click here.