Congress not likely to act on mold bill until next year. (Capitol Beat).

On June 27, Rep. John Conyers (D-MI) introduced the first significant federal legislation addressing mold (H.R. 5040). The scope of the bill is extremely broad and would create standards for preventing, detecting and remediating indoor mold growth as well as establish a "National Toxic Mold Hazard Insurance Program."

Also it would impose numerous mold-related requirements on those who sell, lease or inspect residential property and offer tax credits for mold inspection and remediation.

The National Apartment Association (NAA) and the National Multihousing Council (NMHC) are working closely with Congress on this issue. Given its late introduction in this session and the lack of companion legislation in the Senate, however, it is unlikely Congress will act on the bill this year. (A summary of the bill is posted at www.house.gov/ conyers/mold.htm.)

The House Financial Services Committee on June 18 held a general hearing on mold. NAA/NMHC submitted testimony on behalf of the apartment industry and stressed that rental housing providers are committed to environmentally safe housing, but that the nation needs better science to effectively deal with the problem of mold.

NAA/NMHC noted that literally thousands of different types of mold exist, but there is no consensus among scientists about which molds affect human health and at what exposure levels.

Furthermore, according to medical research, not everyone will react adversely to mold. Because of this, NAA/NMHC told Congress that any health standards that are set must be based on sound science.

NAA/NMHC urged Congress to take action to avoid an insurance and financial crisis as a result of mold claims. We explained that an increasingly aggressive plaintiff's bar is pursuing thousands of complaints nationally, and insurers are responding by excluding coverage for mold damage.

NAA/NMHC called on Congress to establish a blue-ribbon task force of insurance firms, state insurance commissioners, the real estate industry and the medical/academic community to study the situation and make recommendations to avoid a possible insurance crisis.

Finally, we urged Congress to charge the National Academy of Engineering with examining building practices and developing guidelines to help the real estate industry better understand how the selection of design and material can help prevent excessive moisture build up. Our testimony is posted online at www.naahq.org/members/government/ aims/aims.aspx.

NAA/NMHC developed talking points that apartment firms can use to respond to media inquiries about mold. They are posted at www.naahq.org/members/ government/aims/aims.aspx.

Bush Strategy for Homeland Security Costly for Multifamily Housing Industry

The National Strategy for Homeland Security released July 17 by the Bush Administration could mean higher security-related costs for commercial real estate owners. The new security blueprint estimates a 50 percent to 100 percent increase in private sector security costs compared to pre-September 11 levels to help prevent and mitigate the damage from future attacks.

It also proposes a variety of initiatives that could affect apartment owners, such as creating a national incident management system, developing improved sensor technology to detect airborne attacks, coordinating minimum standards for driver's, license identification, and implementing incident management plans.

The document is available at www.whitehouse.gov/homeland/ book/index.html.

On July 17, the U.S. Treasury Department released a proposed rule that would obligate financial institutions to take certain steps to identify their customers. As proposed, companies would have to adopt plans to document customer identity, collect government-issued identification (such as Social Security numbers), and, in some cases, run credit checks and check customer identity against lists of known terrorists.

Though the Treasury proposal does not address rental housing providers, the rule tracks voluntary screening practices contained in NMHC's guidance on terrorism, which was issued May 21. NAA/NMHC view the rule as a potential precedent for any future rulemaking concerning rental housing screeners.

Calling for a National Housing Policy

The U.S. Conference of Mayors (USCM) at its recent annual meeting adopted a resolution calling for a "comprehensive national housing policy."

The action follows the National Housing Forum held May 20-21 that was launched by USCM President and Boston Mayor Thomas Menino.

The mayors called for increased funding for housing and community development, including a new rental housing program for families with incomes up to 100 percent of area median income. They also called for federal incentives for regional fair share affordable housing agreements and housing production consistent with smart growth principles. NAA/NMHC are actively working with the USCM as they move forward.

Lending support to the Mayors' initiative is a new Fannie Mae study that says affordable homes and health care top the list of concerns facing America. The lack of affordable housing is a very or fairly big problem, according to 41 percent of those surveyed. The survey also showed that Americans believe affordable housing is a bigger problem than unemployment (34 percent) or crime (20 percent).

Section 8 Reform Moves in Congress

Congress is considering two bills that would eliminate the bureaucratic red tape and operating inefficiencies that discourage private apartment owners from accepting Section 8 vouchers.

On July 10, the House Financial Services Committee approved its bill (H.R. 3995), and on July 11, a Senate voucher reform bill (S. 2771) was introduced. Congress sought significant input from NAA/NMHC when drafting their bills. For several years, NAA/NMHC have advocated Section 8 reforms to create more affordable housing.

Earlier this year, NAA/NMHC stressed in its testimony that the apartment industry is ready and willing to participate more fully in the Section 8 program, but that such participation is not economically feasible unless Congress eliminates the significant costs and burdens it imposes on apartment owners. The House bill also includes several other NAA/NMHC priorities, including indexing FHA loan limits to inflation and allowing increased FHA loan limits in high-cost areas.

Pressure-treated Wood Phase Out

Because of possible health concerns, the pressure-treated wood industry announced earlier this year it will voluntarily phase out production of lumber preserved with chromated copper arsenate (CCA) by January 2004.

This type of lumber contains arsenic, a known human carcinogen. The move is expected to have a significant effect on the apartment industry because an estimated 80 percent of decks and 90 percent of children's play sets are constructed with CCA-treated wood.

To help members manage the phase out, NAA/NMHC have produced a guidance memorandum that describes alternative products and lists suggestions for safely handling CCA-preserved wood. The memo is available at www.naahq.org/members/government/ aims/aims.aspx.

Information compiled by NAA/NMHC Joint Legislative Staff: Senior Vice President Clarine Nardi Riddle; Vice President of Tax Jim Arbury; Vice President of Finance and Technology David Cardwell; Vice President of Communications Kim Duty; Vice President of Property Management Jay Harris; Vice President of Environment Eileen Lee; Vice President of Building Codes Ron Nickson; and Mark Obrinsky, Chief Economist and Vice President of Research.