On The

Level
N O V / D E C 2 0 1 0

1319 N. Division Sandpoint, Idaho ph 208.263.4967 fx 866.342.4266

Is your
If you are a PBCA member, take a moment to review some of the discounts available to you. Contact Kris Owens for discount codes. If you arent a member, JOIN and start taking advantage TODAY! General Motors $500 exclusive offer on most GM passenger cars, light-duty trucks, vans, SUVs. Includes Buick, Chevy and GMC Liberty Mutual (Home and Auto Insurance) Discounts on Home Owners Insurance up to 10% or more Discounts on Auto Insurance up to 15% or more Dell Up to 30% off on top of the line Dell computers Hewlett Packard Discounts: 9% notebooks, 5% printers/scanners, 7% handhelds, 12% workstations (faster processing power ideal for graphics, blueprints), 16% servers, 12% storage, 6% third party options (over 10,000 items), plus free ground shipping. 20% off the best available rate at over 6,500 hotels, resorts, and over 60,000 rental properties worldwide. Wyndham= Wyndham hotels & resorts, Wyndham Garden, Wyndham Grand, Wingate, Hawthorn, Ramada, Days Inn, Super 8, Baymont Inn & Suites, Microtel Inns & Suites, Howard Johnson, Travelodge, Knights Inn 10% off Endless Vacation Rental properties in the US, Caribbean, Mexico and Canada. Including select US Disney properties. FTD 15% discount Includes FTD bridal, Vera Wang & Todd Oldham Hertz Up to 20% off on rental cars and FREE Gold Club membership.

2010 Board of Directors

Sean Gavin
Mountain View Construction

Verizon Wireless
Eligibility: Physical construction only *Corporate Discount - 22% off all calling plans $34.99 and higher and free activation (unlimited plans excluded) *Employee Discount - 18% off calling plans $34.99 and higher (unlimited plans excluded) Omaha Steaks Save 10% off all online promotions. This discount is in addition to any online specials. Office Depot 10% off all delivery orders. Free shipping on orders of $50 or more. Wyndham Hotel Group & Endless Vacation Rentals

President

John Knowles
Knowles Construction Vice President

Wayne Meaux
Baker Construction Past President

Doug Smith
DSS Construction Building Director (2 Yr)

Scott Schriber
Selle Valley Construction Building Director (1 Yr)

Erick Miller
RBH Construction Building Director (Alt)

Jon Sayler
Jon Sayler, Architect Associate Director (2 Yr)

Sheila Toldness
GII2 Associate Director (1 Yr)

Larry Jeffres
R.C. Worst & Co. Associate Director (1 Yr)

In This Issue..
Presidents Message Green Building Corner Legislative Update The Tax Facts
Sandpoint Small Space Initiative EPA Lead Based Paint Rules Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9

Larry Dehart
Dehart Painting Associate Director (Alt)

Lisa Moline
Alliance Title Co. Secretary

Kevin Kluender
Kevin Kluender CPA, CFP Treasurer

Kristina Owens
Panhandle Building Contractors Association Executive Officer

Executive Directors Message Calendar of Events

REMEMBER YOUR TURKEY DONTATION! Next Meeting January 26,2011

General Membership Meeting & Dinner NOVEMBER 17TH

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2010 PBCA President Sean Gavin

Presidents Message...
Dear Members, I want to thank our Fall Fundraising Committee Dan Hunt, Jason Coleman, Clem Hackworthy, Kevin Kluender and Kris Owens for all of their hard work. I also want to thank everyone who attended and those who donated auction items. The event was a great success! If you were unable to attend, dont miss out next year. Winter is breathing down our necks so I hope that everyone has started the projects that will get them through to spring. It is supposed to be a La Nina winter with lots of snow so you can look forward to it being colder and wetter than normal across the northwest. At least it should prove profitable for snow removal. Anyone interested in attending the International Builders Show in Orlando should register soon. The show runs January 12-15 and you can register online at www.nahb.org . Those who have attended in the past have said it is definitely worth going to. Its not too early to think about the 2011 PBCA Home and Garden Show. Contact Veta McKinney to reserve your booth space or to volunteer. I hope everyone has a great Thanksgiving. Jamie and I will be on our honeymoon in the Caribbean drinking Mai Tais. Thank you to everyone who has made the PBCA the great organization that it is today. Cheers!

Dreaming of your name in lights.

Contact Kris Owens, Executive Director, and be the next contributor to our newsletter. With name and company recognition, youre sure to get noticed!

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GREEN BUILDING CORNER

Good and honest people view green from sometimes different angles. Not that one is wrong, but there may be more to consider.

Written by Bob & Rhonda Backman AirSeal Insulation

Recently, a quality builder in our area had an experience that drives this point home. He had built a well insulated house that seemingly should have consumed less energy than it has in its first year in operation (to his disappointment!). While at the home doing warrantee work, he noticed that the bedrooms seemed very cold, upon examination he discovered that the vents he had installed by the windows were open. After bringing the fact to the clients attention, the vents were closed! My point: a superbly built home, well insulated, but not air sealed, will consume more energy than need be. Quality HVAC systems will perform most efficiently in an air sealed house. The easiest and most durable way to air seal is accomplished with spray foam insulation. If in question, let a blower door test be the proof.

LEGISLATIVE UPDATE.

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IDAHO CONTRACTOR REGISTRATION ACT

On January 1, 2006 the Idaho Contractor Registration Act was implemented making it unlawful for any person to engage in the business of, or hold himself out as, a contractor within this state without being registered. The act also made it unlawful for a contractor to engage any other contractor who is required to be registered as a contractor unless such other contractor furnishes satisfactory proof to the contractor that he is duly registered under the provisions of the law. With all of that said, the legislature found that it was in the publics interest to provide a mechanism to remove from practice incompetent, dishonest, or unprincipled builders in our state. The Idaho Contractors Board was created and made a part of the Bureau of Occupational Licenses. It became the responsibility and duty of the bureau chief to administer this board consisting of four contractors from each geographic area of the state as well as one member of the public at large. All positions are filled by appointment from the sitting governor of Idaho. Each contractor member of the board serves a four year term in an equally staggered fashion. There has been generally good support for the licensing of contractors in Idaho from members of the home building associations at the state and local levels. A fundamental opportunity to track irresponsible contractors or force a perspective contractor to prove their worthiness by a simple registration process has value in itself. Obviously, nothing is perfect and one of the primary objections to contractor registration is the lack of strong enforcement and penalty for those who go astray of the law. Currently, any person acting in the capacity of a contractor without a current registration shall be guilty of a misdemeanor and upon conviction, be punished by a fine of not to exceed $1,000 or by imprisonment in the county jail for a term not to exceed six 6 months. At the discretion of the court, both penalties can be applied. For the past five years, it is difficult to find court cases where any form of penalty was applied. Going into the 2011 Idaho Legislative Session, there have been rumblings from some legislators to the effect of wanting to disband the Idaho Contractors Board based on ineffective enforcement and consequence. In the opinion of this writer, that would be equivalent to throwing the baby out with the bathwater. From real, firsthand experience, the majority of contractors I have spoken with believe the quality of contractors in our state has improved since 2006. If this real, feet on the ground experience is accurate lets build on what we have instead of dismantling an imperfect process. There have been lessons for all of us, some right here in our own back yard, where complete dismantlement of oversight and regulation created as much or more negative than positive. In an era where the mantra of too much government is an easy bus to jump on, I am hopeful we are careful not to overreact and get caught up in the fervor of it all. We have a wonderful collection of legislators in North Idaho who are very good at listening. If you have an opinion on this subject and want to share that opinion with one of said legislators, please find an email address for each following. Express your opinion either way and maybe we can head this one off at the pass before it gets to bill writing. Senator Shawn Keough Representative Eric Anderson Representative George Eskridge Senator Joyce Broadsword skeough@senate.idaho.gov eanderson@house.idaho.gov geskridge@house.idaho.gov jbroadsw@senate.idaho.gov

Larry Jeffres, R.C. Worst & Co.

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Written by Kevin Kluender, CPA CFP

Since Congress left for the campaign trail without taking action on the expiring tax law, this month I want to remind our members about the what could be the biggest tax break available to you. One word of caution, virtually all of my clients have told me that their spouse would never go for the

idea. The tax break that I am talking about is the exemption for the sale of your primary principle residence. This allows a taxpayer to exclude up to $250,000 ($500,000 if married filing jointly) of gain realized on the sale or exchange of a personal residence. To realize the full exclusion the taxpayer must meet all of the following three tests: 1. Ownership: The taxpayer must have owned the residence for periods aggregating at least two years during the five years ending on the date of the sale or exchange [IRC Sec. 121(a)]; 2. Use: The taxpayer must have occupied the residence as a principal residence for periods adding up to at least two years within the five-year period ending on the date of the sale or exchange [IRC Sec. 121(a)]; 3. One Sale in Two Years: The taxpayer must not have used the $250,000 (or $500,000) exclusion for any residence sold or exchanged during the two-year period ending on the date of the current sale or exchange [IRC Sec. 121(b)(3)]. Now that we are all familiar with the exclusion lets talk about how much tax you can save. For the purpose of this example lets propose that you will build a new home with a total cost of $275,000 and then sell it for $300,000. Now lets look at what the tax savings would be for living in the home for two years before you sell it.
DirectSale SalesPrice Cost Profit FederalTax(15%) IdahoTax(7.8%) SelfEmploymentTax(15.3%) Netaftertaxincome 300,000.00 (275,000.00) 25,000.00 (3,750.00) (1,950.00) (3,825.00) 15,475.00 Personal Residence 300,000.00 (275,000.00) 25,000.00 25,000.00 3,750.00 1,950.00 3,825.00 9,525.00 TaxSavings

You would save over $9,500 dollars on tax on a profit of $25,000. The tax savings have the potential to be much larger since the gain exclusion allows you to exclude up to $500,000 of gain. Doing more of the labor yourself and shopping for bargains on building materials could pay off handsomely for owner builders. The tax savings also increase if you are in a higher tax bracket. You can use this exclusion once every two years, but you will have to get your spouse to agree to move. Thanks for reading and please feel free to ask me any questions that you may have about the use of the exclusion. P.S. Dont tell your spouse that I gave you the idea.
The information provided in this article was written in general term to apply to a wide audience and should not be used for any specific tax situation. Readers should consult with a tax professional before implementing any of the strategies suggested

Sandpoint Small Spaces Initiative

Written by Scott & Barbara Schriber Selle Valley Construction

Sandpoint Councilman Stephen Sneddon recently held a public workshop in front of City Council and the Sandpoint Planning Commission to discuss his proposed "Small Spaces Initiative". Although the proposal concerned both residential and commercial properties and development, we are going to focus on the residential components. The general purpose of the Small Spaces Initiative was to encourage more affordable housing within the City limits by creating the Certified Small Spaces program. It is reasoned that the City will save money on services such as sewer, water and transportation if land is better utilized and infill development is encouraged. Certified Small Spaces are defined as active buildings that have a 1,000 square foot footprint or less. If a project is a Certified Small Space it would receive a number of incentives, including a fast-track application process (jumping to the front of the line), five years to pay for NUFFs and impact fees, and reduced parking requirements for one unit per property for footprints less than 600 square feet. Sneddon's proposal also included an incentive for the construction of energy efficient buildings by rewarding LEED or NAHB Green Building Standard certified buildings with full reimbursement of City application and permit fees. The City would partner with the Sandpoint Urban Renewal Agency to reimburse impact and NUFF fees for certified buildings. The workshop's intention was to provide a forum for discussion amongst Council members, Planning Commission members, City staff and the public. A number of local building industry members were present, including architect Bruce Millard, builder/developer Steve Lockwood and myself. There was an active discussion between all parties about the best ways to encourage affordable housing, touching on subjects such as square footage vs. lot size, Accessory Dwelling Units (ADUs), relaxing restrictions on home businesses, impact fee calculations and rewarding green building. Many of the options conform to the City's Comprehensive Plan. According to City Planner Jeremy Grimm, the discussion allowed the Planning & Zoning Commission to confirm that the City Council approves of many upcoming zoning changes. There seemed to be agreement about removing minimum lot sizes for PUDs and allowing building on historical 25 foot lots. In October the City also released an RFP for an Impact Fee Study, which is expected to adjust many of the City's Impact Fees. The 2005 study was calculated using 2005 land prices, which we all know have significantly adjusted downward. One area that there didn't seem to be agreement was rewarding green building. Councilman Schuck said its not the Citys role to encourage or choose a mechanism beyond the Citys code, its the buyers decision and Councilman Reuter said that he believed the cost to achieve certification is greater than the rebate. I personally disagreed with Schucks and Reuters comments arguing that it would be advantageous to the city and its infrastructure to have homes and buildings that put less of a burden on their systems. In 2009 voters approved a water bond that the City argued was necessary because the current system didn't adequately meet needs. At the end of the discussion it appeared that the City will not reward certified green building with any reduction in fees.

Continued on next page.

Sandpoint Small Spaces Initiative..Continued

It has to be said that other City, County and even State governments across the county have seen the benefits of green building and resource conservation and have adopted some type of reward to encourage green building. It is apparent that water resources are diminishing among greater demand and that the cost of providing all utilities will increase. For example, the State of Delaware recently adopted Delaware Green for Green, a statewide program that offers rebates from $3,000 to $6,000 for building homes certified by the NAHB Green Building Standard. The City of Sandpoint recently approved commercial zoning changes to conform with the City's Comp Plan. Industrial changes should be complete by the end of the year and residential zoning changes will be addressed in early 2011. The City hopes that helping apportion the cost of land with higher densities and reducing fees will encourage the development of affordable housing. As the economy improves, demand for home ownership should and hopefully will increase, but probably for a more affordable inventory geared to our year-round population. We are all part of the building community, so please be involved in this process and attend Council, Commission and workshop meetings to voice your comments and concerns.
Written by Larry Dehart, Dehart Painting

EPA Lead-Based Paint Rules

Problems Ahead for Contrac-

On April 22, 2010, the USEPA implemented a rule that requires contractors who are hired to perform renovation, repair and painting projects in homes, child care facilities and schools built before 1978 that disturb leadbased paint to be certified and follow specific work practices to prevent lead contamination. This rule is expected to impact hundreds of thousands of employers and millions of employees. Failure to comply with this new regulation can result in fines as high as $65,000 per violation, as well as a potential prison term. The USEPA will enforce violations of the new regulation starting on Oct. 1, 2010. The USEPA is already proposing an expansion of this rule into pre-1978 commercial facilities, which will significantly expand the scope of employers and building owners covered by this new regulation Please re-read the previous sentence and let it sink in. According to the letter of the law in referring to commercial facilities, if you own a pre 1978 apartment building or a store and decide to have a handyman move a wall partition or in some other way disturb 6 square feet of paint or more per room, forget it. Not only will the owner have to be certified by the EPA, but he will need to employ a certified renovator to train workers and oversee the project. Im not going to use my space to speculate about what most would see as insanity or some kind of huge power grab but I am going to warn that there is even more to this than there seems at first. There is what seems to be a disconnect between the USEPA and OSHA. By that I mean that that the 8 hour class that is provided to become certified only covers the EPA requirements and completely ignores the OSHA worker protection rules. There is a whole load of OSHA rules, other than the EPA requirements, that include HEPA vacuums, signage, regulated areas, disposable or employer laundered protective clothing, mandatory respirator use, an OSHA conforming clothes changing facility, mandated biological monitoring for employees, and on and on ad infinitum. Know how your lead tester kit determines content. The EPA rule defines lead-based paint as containing more that 0.5 percent lead by weight. OSHA regulates lead in any amount. GOOD GRIEF! I have an idea just dont ever do any work on pre 1978 buildings! Considering that Uncle Sam is looking for income everywhere that he could find it you can bet that OSHA will take advantage of what you might not know. Educate yourself at http://www.osha.gov/SLTC/lead/construction.html

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Hello PBCA Members & Friends:

PBCA Executive Director

Kris Owens Orange, yellow, red & brown. November is here with brilliant fall colors and chilled days. I hope you are taking some time to enjoy all the changes that Fall has to offer. If you did not attend the October General Membership Dinner meeting, you missed a wonderful time. Our attendance was high and the Idaho Fish & Game gave an informative presentation about Netting Lake Pend Oreille. The population of Kokanne in our lake is thriving. Their plan is working wonders. I want to thank the members who have sent in articles for the November issue of On the Level PBCA newsletter. Without your help this newsletter could not be possible. Winter is upon us and I am requesting some articles regarding tips on winterizing your landscaping displays, yards and home for the December issue. Lets keep this newsletter in production. Remember, this is your Association. Turkeysare needed for the Bonner Community Food Center. I invite all companies to bring turkeys to the November 17th, 2010 General Membership Dinner Meeting. You will be given a raffle ticket for free for bringing a donation for the Food Center. To make it easier for youjust bring a company check for the Food Center. Thanks for all your food donations!!!! They are very much appreciated. Elections for the 2011 PBCA Board of Directors will be held during our November 17th, GM dinner meeting. This dinner meeting is very important for you all to attend. THIS IS YOUR ASSOCIATION!!! Who do you want on the board? Hope to see you all there. Thank you PBCA members for all you support!

Ace Septic Advantage Site Mixed Concrete Air Seal Insulation Albright & Thurston, Inc. Alliance Title & Escrow Avista Utilities Baker Construction Colin Construction Columbia Paint & Coating Co-op Energy CTA Achitects / Engineers Dehart Painting, Inc DSS Construction Excell Drywall First American Title GII 2 Glahe & Associates High Mark Heating & Cooling Idagon Homes, LLC Idaho Lights. Inc In & Out Painting Inc. Integrity Custom Log Homes Interstate Concrete & Asphalt Jon Saylor Architect Kevin Kluender CPA, CFA

Knowles Construction Legacy Construction, Inc Mitchell Enterprises Mountain Metal Works Mountain West Bank Mountain View Construction North County Electric Northstar Plumbing Nu-Tech Mechanical NW Prestain & Finish Panhandle State Bank ParaDyce Builders, LLC Pend Oreille Mechanical Pro Build / Lumbermen's Pro X Home Center R.C Worst & Co. RBH Construction, LLC Reader Construction RHL, Inc Sandpoint Building Supply, Inc. Sandpoint Construction, Inc Sandpoint Framing & Ext Sandpoint Furniture Sandpoint Title Insurance Sears Selkirk Glass & Cabinets

Selle Valley Construction, Inc Sierra Pacific Windows Spielman Construction Stock Building Supply Stone Creek Land Design & Develop. Summit Insurance Resource Group Talache Construction Tomlinson Black Real Estate Truss Tek, Inc Wiley Land Surveying

Were on the Web! www.panhandlebca.com

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The Panhandle Building Contractors Association, Inc. is a non-profit trade association dedicated to promoting and protecting the build-

November 2010
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2009 IRC Requirements for HVAC System Design

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For more information on any class listed, or to add your event to the calendar, contact Kris Owens

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