Virginia Builder July 2009

VIRGINIAbuilder

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Celebrating more than 50 years of service to housing in Virginia Vol. 22, No. 6 July 2009

Membership numbers on the up and up 2009 state elections present PAC opportunity

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Harrisonburg(888) 526-3189

Iron Gate (540) 862-4148

Kenbridge (434) 676-8217

Madison Hts. (434) 528-9843

Mt. Jackson (540) 477-9355

Petersburg (804) 862-4560

Portsmouth (757) 488-7803

Ranson, WV (800) 222-0808

Richmond (804) 783-9500

Roanoke (540) 362-0286

South Hill (434) 447-3600

Stephens City (800) 237-1320

Suffolk (757) 539-5371

Warrenton (540) 347-2055

Warsaw (804) 333-3790

Waynesboro (540) 942-4101

July 2009 Virginia Builder 1

2009 HBAV officersE. Rand Sompayrac, presidentMichael D. Newsom, first vice president- treasurerC. Richard Bogese Jr., second vice presidentKevin DeChristopher, associate vice presidentRobin S. Newhouse, vice president-secretary

Regional vice presidentsRegion I: Robert J. FlynnRegion II: Hugh MitchellRegion III: Chip HudnallRegion IV: David BlalockRegion V: Richard ColemanRegion VI: David Hepler

State representativeJohn D. Stokely Jr. (Northern Virginia)

HBAV staff Michael L. Toalson, executive vice presidentBarrett Hardiman, vice president/director of regulatory affairsKathy M. Harley, director of administration

and finance/education directorJames D. Bonnell, director of member benefits servicesBarb Preddy, administrative assistantRhonda Allison, legislative assistant 707 E. Franklin St., Richmond, VA 23219 (804) 643-2797 www.hbav.com

Editorial inquiries can be directed to:Stacey Enesey Klemenc E-mail: [email protected] 2112 Flowerdew Ct. Virginia Beach, Va. 23454, (757) 427-6355

Advertising inquiries can be directed to:Lisa Nixon E-mail: [email protected] 2213 South Brook Drive, Orange Park, FL 32003, (877) 449-2535

Published by Association Publishing Inc.www.associationpublishinginc.comSandra K. Amidon, Joyce F. Hearn APR 2117 Smith Ave., Chesapeake, Va. 23320 (757) 420-2434Advertising sales assistant Valerie MyersGraphic designer Paige Takach

To change your address (804) 643-2797 Virginia Builder mails copies of the magazine to names supplied by the Home Builders Association of Virginia. To correct your address, please contact HBAV at the number above. Nonmember subscriptions are available from the publisher for $27 a year. Virginia Builder (ISSN 1552-8715) is published nine times a year for members of the Home Builders Association of Virginia and is edited according to AP style. Acceptance of advertising in Virginia Builder does not imply endorsement of the product or service by the Home Builders Association of Virginia. Opinions expressed in articles are those of the authors and people quoted and not necessarily those of the Home Builders Association of Virginia. Mention of specific products or services in editorial content does not imply endorsement by Virginia Builder or the Home Builders Association of Virginia. No material may be reproduced for further publication without the express permission of the association and the publisher.

Affiliated with the National Association of Home Builders.

departments

2 President’s Perspective

8 Counsel’s Corner: Public contracting in Virginia – are you ready?

10 Stateline

1 1 HBaV Build-PaC Honor roll

12 Membership Benefits update

12 advertisers’ index

4 Membership increases in leaps and bounds

5 Bank notes: Sales boost expected from new FHa tax credit rules

6 2009 state elections: an opportunity for HBaV Build-PaC

FeatUres

On the cover: The recent decision to allow home buyers to apply the $8,000 first-time home buyer tax credit toward the purchase of an FHA-insured home is expected to provide a further boost to home sales. (Photo courtesy of Andersen Windows.)

Superheroes of all shapes converged throughout Virginia in honor of National Membership Day in May. Seen here (from left) Tidewater BA members Matt “Greenie” Froehler, TBA President Pete A. “Super Builder” Kotarides, John “Iron Man” Ainslie and Deb “Robin” Carson join forces with TBA EVP Channing “Superman” Pfeiffer to help take the Virginia local up, up and away in the annual membership drive. TBA ended up placing fifth in the nation.

The official magazine of the Home Builders Association of Virginia Vol. 23, No. 6 July 2009

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VIRGINIAbuilder

2 Virginia Builder July 2009

In challenging times, associations, just like private enterprise, usually become intro-spective of all processes and methods of doing business or serving members.

Besides determining the current threats, associations also tend to look to the future to see where improvements can be made. The strategic planning process is one of

HBAV strategic plan on the horizonBy Rand Sompayrac, 2009 HBAV president

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the best ways to accomplish this. HBAV’s last strategic planning session was

in 1999. Staff and the current leadership team recently reviewed the prior identified short-term and long-term goals and concluded the last plan a success. Many of the identified goals were reached and benefited the association’s growth and its membership services.

At the HBAV Annual Con-vention in June, the leadership proposed to the Executive Com-mittee that the association would greatly benefit from another strategic exercise. As a result, both the HBAV Executive Committee and board of directors overwhelmingly approved the launch of a strategic plan update this year, which pleased me immensely.

HBAV has begun the process by de-signing a relevant survey that will be sent to qualified members for their input and direction for the future. HBAV staff and leadership also have begun the interview process to select a facilitator to guide the planning process to a successful conclusion later this year.

The National Association of Home Builders’ leadership handbook suggests a successful strategic plan will ensure the association’s continuity, establish goals and objectives, direct the leadership team and educate members about the benefits of association membership. All of these at-tributes will improve HBAV for you — our valued member — and the industry we so proudly serve.

The survey will be mailed soon. Please thoughtfully respond as your input will help guide the discussion process toward improving the association for all.

Home sprinkler mandateThe process of the Board for Housing

and Community Development to consider the International Code Council mandate in the International Residential Code that all new single-family homes be sprinkled began the f irst week in June, when a special subcommittee of stakeholders met in Richmond. HBAV will vigorously oppose the ICC sprinkler mandate before BHCD. Representing HBAV are Richmond builder

Steve Thomas, Tidewater builder John Ain-slie, Northern Virginia/Winchester builder Randy Melvin and HBAV Executive Vice President Mike Toalson.

The consideration of the sprinkler mandate is just one issue in USBC’s 2009 update. The complete process includes four stakeholder groups: Inter-national Energy Conservation Code, Code Administration and International Fire Code, International Building Code (commercial) and IRC (one- and two-family dwelling units three stories or less). Each group

has met twice on the numerous proposed changes to the ICC family of codes in an effort to reach a consensus.

In the IRC, the HBAV team will lead the effort to eliminate the proposed ICC mandate that all single-family dwelling units be sprinkled. HBAV is the only organization at the table expressing opposition to the sprinkler mandate. It is strongly supported by the sprinkler industry and fire chiefs from throughout Virginia.

The sprinkler mandate issue was first considered by the board’s Codes and Standards Committee June 22. The board will conduct a public hearing July 27 in Richmond. A comment period on the issue will be held in August, September and October. In November or December, the C&S Committee will review the public comments. In June 2010 the board will make a final decision on this and many other controversial issues.

DCR stormwater management proposal threatens business climate

On June 22, the 60-day comment period for the controversial Department of Conservation and Recreation stormwa-ter regulations began. HBAV Director of Regulatory Affairs Barrett Hardiman, who has been participating in the 15-month-long process, drafted our comment letter to DCR and forwarded instructions to every local association and members of the HBAV Legislative Committee and Regulatory Com-mittee on what action needs to be taken. Through every step of this process, HBAV

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has stated its objection to the direction of these regulations (flawed methodology) and their significant impact on the business climate in the Commonwealth.

Upon completion of the comment period, DCR staff will summarize the comments for the Soil and Water Conservation Board. Additionally, they will propose changes to the regulations for the board to consider based on the comments received. DCR anticipates the board will take a final vote on the regulations at its December 2009 meeting.

The regulations will become effective July 1, 2010, after the 2010 session of the Virginia General Assembly.

2009 Statewide Membership Drive:A BIG success

More than 500 new members were added to the HBAV membership roll during the 2009 Statewide Membership Campaign in March, April and May.

Congratulations to all the HBAV-affiliated local associations that chose to participate in an outstanding membership drive ef-

fort. As most of you know, we grouped the 16 local associations into three similar categories by member numbers, thereby leveling the contest.

The contest winners in each category follow. First-place winners received a $1,500 HBAV award and second-places, $1,000:

Category A – Tidewater BA won with an increase over goal of 114 percent. Roanoke Regional HBA achieved second place with an increase over goal of 83 percent. Honorable mentions go to HBA of Richmond with an increase over goal of 80 percent and Northern Virginia BIA with an increase over goal of 67 percent.

Category B – Shenandoah Valley BA won with an increase over goal of 107 percent. Second place was achieved by Blue Ridge HBA with an increase of 75 percent.

Category C – HBA of Rappahannock won with a whopping increase over goal of 239 percent. Augusta HBA came in second with an outstanding 163 percent increase over goal. Honorable mentions go to New River Valley HBA for its tremendous increase over goal of 139 percent, to Top of Virginia’s 91 percent and to Piedmont

HBA’s 79 percent increase over goal.Congratulations also to Rappahannock,

Augusta, New River Valley, Tidewater and Shenandoah Valley for exceeding the 11 percent increase of membership that qualified their local executive officers and a guest to receive free registration to HBAV’s Annual Convention at Hilton Head last month. We are extremely proud of these staff members who inspired and motivated their members to achieve their association’s goals.

HBAV’s leadership and staff would like to extend to each successful association’s officers, leaders, membership and staff our most sincere appreciation for a job well done. Everyone involved at these local building associations should be extremely proud of their hard work and very successful accomplishments. You are all superheroes!

In addition to the hardworking local associations mentioned above, a great big thank you goes out to HBAV Membership Chairman Richard Bogese; HBAV Membership Ambassador Mike Newsome and Team HBAV (Kathy Harley and Jim Bonnell) for a very successful membership campaign. VAB

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The Home Builders Association of Virginia wishes to express its appreciation to the following members for their generous support of the 2009 Annual Sponsorship Program:

“We are surprised and pleased with the membership results of this year’s drive,” says Ed Brady of Brady Homes in Bloomington, Ill., and the 2009 NAHB membership chairman. “We consider the real victory to be the high participation and high energy we saw this year. Our members are no less committed today than they have been to cultivating a strong local membership.”

HBAV’s successful statewide campaign concluded with a two-day push May 13 and 14, with the locals calling in their numbers May 14.

“The highlight, for me, was traveling around the state to most of our local associations to promote the campaign and meet so many active, involved members.

Channing Pfeiffer helped his local take off with a flying start during Tidewater Builders Association’s drive for new members. The local association finished first in its category statewide and fifth in the nation during the superhero- themed competition.

Membership increases in leaps and boundsthanks to national Membership day

Their accomplishments are extraordinary,” says Michael Newsome, HBAV’s first vice president/treasurer who served as campaign ambassador and led the campaign.

For Virginia’s campaign, the 16 local associations were grouped into three similar categories according to size. In Group A, Tidewater BA placed first and Roanoke Regional placed second. Group B’s winner was Shenandoah Valley BA, with Blue Ridge HBA placing second. And in Group C, HBA of Rappahannock won, with Augusta HBA the runner-up.

Nationwide, TBA placed fifth by recruit-ing more than 100 members.

In Virginia, all 16 local associations agreed to enthusiastically par ticipate in the membership campaign, which began

statewide March 19 with a recruitment training session in Fredericksburg. More than 100 recruiters attended a three-hour motivation and training session presented by nationally known sales trainer Bob Schultz of Florida.

Dur ing the campaign, HBAV sent weekly updates to its local associations and all those who attended the training session. The updates included motivation and challenges between local associations, which had formed teams across Virginia, many of which focused on the national superhero theme.

“HBAV staff and local membership teams worked incredibly hard to make the national membership drive a huge success,” says Rand Sompayrac, 2009 HBAV president. “The recruited ‘new’ members realize the tremendous value of our membership and are positioning their company to take advantage of the recently begun recovery.”

Editor’s note: Virginia Builder will report the actual tallies and note the member who recruited the most new members when we receive the official numbers from NAHB. VAB

The tough housing market did not deter federation members and local associations from recruiting 5,055 new members during NAHB’s National Membership Day May 19. When all was said, done and tallied,

the super efforts of the Home Builders Association of Virginia’s local associations netted more than 500 new members toward that number.

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PLATINUMDominion Virginia PowerHBAV Benefits Group

Virginia Housing Development Authority

SILVERClark Whitehill Enterprises Inc.Creative Home Builders LLCFSK Property Management

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Sales boost expected from the new FHa tax credit rules

The recent decision to allow home buyers to apply the Obama ad-ministration’s $8,000 f irst-time home buyer tax credit toward

the purchase of an FHA-insured home is expected to provide a further boost to homes sales, says Robert Dietz, director of tax issues for the National Association of Home Builders.

Home buyers who are using FHA-approved lenders can only apply the tax credit to a down payment exceeding the 3.5 percent minimum required on an FHA-insured mortgage — or to their closing costs, Dietz says.

The mor tgagee letter permits lend-ers to purchase the anticipated tax credit from the home buyer. The proceeds from this sale can be used by the home buyer to provide an additional down payment or to pay closing costs, such as escrow for taxes, insurance and community associa-tion assessments. The funds also can be used to buy down the interest rate of the mortgage.

FHA-approved lenders are not al-

lowed to place a second lien on the home, he says. Instead, they must secure repayment through a contract with the home buyer.

It is unclear at this time what form the lender option for monetization of the tax credit will take. NAHB will follow this issue and provide updates as they develop.

In all cases, the FHA limits fees associ-ated with either a tax credit loan from a government entity or the purchase of the tax credit by an FHA-lender to no more than 2.5 percent of the tax credit amount, or $200 for an $8,000 tax credit.

Prospective first-time home buyers should be cautious in participating in programs

that offer monetization, Dietz says. If the organization is part of the state govern-ment, it is safe to assume that its program is reputable. Otherwise, home buyers may want to check with their local Better Busi-ness Bureau or a state or local government’s department of consumer affairs.

Expected market benefitAssessing the impact of the tax credit

on the housing market, NAHB economists earlier this year calculated it would help to stimulate 160,000 incremental home sales — 101,000 to first-time buyers who receive the credit and another 59,000 to existing homeowners who will be able to buy another home after selling their cur-rent home to a first-time buyer.

In an update of those projections follow-ing the FHA announcement and including the impact of prior state monetization

programs, NAHB analysis indicates the tax credit program now will generate 192,000 incremental home sales, including 121,000 to first-timers and an additional 71,000 to move-up buyers. These transactions will add 73,000 jobs to the economy this year.

More than 560,000 taxpayers claimed the tax credit for sales in 2008, according to data from the treasury inspector general for tax administration, and NAHB forecasts more than 1 million taxpayers will claim the $8,000 tax credit for 2009 purchases.

Under current law, the first-time home buyer tax credit only applies to home sales completed prior to Dec. 1, 2009. For more information on the tax rules of the program visit www.federalhousing taxcredit.com/.

For further information, e-mail [email protected] or call Dietz at (800) 368-5242, ext. 8285. VAB

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HBAV Build-PAC Chairman Anthony Clatterbuck has called 2009 an important election year for the housing industry in Virginia, explain-

ing, “All 100 seats in the House of Delegates and the three statewide offices are up for election. This is an opportunity for HBAV Build-PAC to help elect a governor, lieutenant B

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2009 state elections: An opportunity for HBAV Build-PAC

governor and attorney general who respect and appreciate the many contributions our business makes to the Virginia economy, not bash it or over-regulate it to the point few can afford a new home.

“The decisions of the HBAV Build-PAC trustees will make a difference in our busi-ness climate,” he says. “I cannot think of a

better investment for me and my company to make to protect its future.

“Heck, I know this is a difficult year for the housing industry and I can’t contribute to HBAV Build-PAC at the same level I did when the housing market was much better, but I can contribute a little. I encourage every member of HBAV to follow my lead. The state legislature isn’t going to close shop in 2010 because my business is off. It’s going to meet and it’s going to consider lots of legislation that will impact housing. I need to do my fair share to help elect candidates this year who will support housing,” he says.

“There are state legislators and statewide candidates who understand the value of affordable housing and homeownership to neighborhood schools, community safety and family stability and we should help re-elect and elect those candidates,” says Clatterbuck. “Some politicians have found it easy to bash home builders and vote that way, and we should make every one of them face stiff opposition in the 2009 general elections.”

HBAV Build-PAC was formed more than 20 years ago to enable the housing industry to coordinate and make informed decisions on its support for candidates for state leg-islature and statewide office.

“Every year the Virginia General Assembly considers numerous issues that threaten the affordability of housing and consequently the vitality of the housing industry,” says Clat-terbuck. “This is our opportunity to help elect pro-housing/pro-business candidates to the Virginia General Assembly.”

Every contribution to HBAV Build-PAC goes to candidates and all contributions are approved by the HBAV Build-PAC trustees. Build-PAC also receives contributions from state association dues and HBAV voluntarily directs $12.50 of the state dues to the PAC. The PAC is nonpartisan—it’s neither a Republican nor Democratic entity. Its politics is hous-ing and pro-business/pro-housing candidates receive support for their campaigns.

“One-hundred percent or fair-share support of $100 from every member of HBAV for HBAV Build-PAC would be a strong defense for housing,” Clatterbuck concludes.

HBAV members may support HBAV Build-PAC by sending a business or personal contribution to HBAV Build-PAC, 707 East Franklin St., Richmond, VA 23219. VAB

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Benefits through Anthem Life

Anthem Life’s group life insurance helps employees provide

financial security for their loved ones. As an association member

you now get this security as part of your benefits plan at no

additional cost.

ALL COVERED EmpLOyEEs AnD DEpEnDEnts RECEiVE:

$10,000 Life and AD&D coverage

• Group Term Life & AD&D Insurance promise timely benefit payments for the family if an employee passes away or faces a qualified loss in

an accident.

$2,000/Spouse and $2,000/Child Dependent Life coverage

• Dependent Life Insurance pays a benefit to your employee if a spouse or child passes away.

Resource Advisor

• This program gives employees and their families free and confidential access to support resources, including:

• Up to three legal and/or financial consultations for all employees

• Up to three visits per year with a counselor for employees with a disability

• Up to three in-person counseling sessions as well as three legal and/or financial consultations for beneficiaries

• 24/7 telephone counseling and referral services

• Web site resources for child care and elder care databases, wellness information, wills, and power of attorney forms

Travel Assistance

• Provides emergency medical assistance, travel services, and pre-departure information for members in case a medical emergency arises

while traveling 100+ miles from home for personal or business reasons.

This insert is only one piece of your enrollment package.

Exclusions, limitations, and applicable policy numbers can be found in the enrollment brochure.

vALue-ADDeD ASSoCiATion BenefiTS

As an association member, you receive — at no additional cost — special benefits and programs designed to bring even more value to your Anthem plan.

payment of the premium by the employer constitutes acceptance and agreement of the terms detailed in the group insurance policy and certificate and as outlined above.

In Virginia: Anthem Blue Cross and Blue Shield is the trade name of Anthem Health Plans of Virginia, Inc. (serving Virginia excluding the city of Fairfax, the town of Vienna and the area east of State Route 123). Life and Disability products underwritten by Anthem Life Insurance Company, an independent licensee of the Blue Cross and Blue Shield Association. Anthem Blue Cross and Blue Shield and its affiliated HMOs, HealthKeepers, Inc., Peninsula Health Care, Inc. and Priority Health Care, Inc. are independent licensees of the Blue Cross and Blue Shield Association. ® ANTHEM and 360o Health are registered trademarks of Anthem Insurance Companies, Inc. The Blue Cross and Blue Shield names and symbols are registered marks of the Blue Cross and Blue Shield Association.

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This ad is only one piece of your enrollment package. Exclusions, limitations, and applicable policy numbers can be found in the enrollment brochure.

Payment of the premium by the employer constitutes acceptance and agreement of the terms detailed in the group insurance policy and certificate and as outlined above. In Virginia: Anthem Blue Cross and Blue Shield is the trade name of Anthem Health Plans of Virginia, Inc. (serving Virginia excluding the city of Fairfax, the town of Vienna and the area east of State Route 123). Life and Dis-ability products underwritten by Anthem Life Insurance Company, an independent licensee of the Blue Cross and Blue Shield Association. Anthem Blue Cross and Blue Shield and its affilated HMOs, HealthKeepers, Inc., Peninsula Health Care, Inc. and Priority Health Care, Inc. are independent licensees of the Blue Cross and Blue Shield Association. ® ANTHEM and 360° Health are registered trademarks of Anthem Insurance Companies, Inc. The Blue Cross and Blue Shield names and symbols are registered marks of the Blue Cross and Blue Shield Association.EVASH4220A (10/08)


Public contracting in Virginia – Are you ready?

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President Barack Obama’s economic stimulus plan will provide more money for public construction projects in

Virginia. Contractors should be familiar with the requirements of the Virginia Public Procurement Act, Va. Code §2.2-4300 et. seq. The PPA applies to most Virginia state and local public construction projects and sets forth provisions applicable to their bidding, contracting and resolution of dis-putes. This article will summarize some of the PPA’s key provisions.

BiddingA construction contract can be awarded either pursuant to

a “competitive negotiation” or a “competitive sealed bid (Section 2.2-4303).”

Competitive negotiation for construction projects is disfavored but, when used, typically requires two or more fully qualified offerors selected on the basis of evaluation factors set forth in the Request for Proposals. Price is considered, of course, but it’s not the sole determining factor.

The public body selects the best proposal after interviews with the offerors. A competitive sealed bid is exactly what it says. Pursuant to an invitation to bid, contractors submit their sealed bids, which are then publicly opened and announced. The contract is then awarded to the lowest “responsive” and “responsible” bidder.

A responsive bidder is a bidder who has submitted a bid that conforms in all material respects to the invitation to bid. A responsible bidder means “a person who has the capability in all respects to perform fully the contract requirements and the moral and business integrity and reliability that will assure good faith performance, and who has been prequalified, if required (Section 2.2-4301).”

Disputes can arise during the bidding process. A bidder’s low bid can be rejected if it is considered not responsive. A bidder can be disqualified before or during the bid process as being not responsible. A bidder can seek to withdraw its bid claiming it contains an error.

When the public body determines the apparent low bidder is not responsible, it must — prior to issuing its written determina-

tion of nonresponsibility — notify the affected bidder in writing. The bidder then has 10 business days to respond in writing with its rebuttal.

The public body must then make a decision in writing and serve that decision on the bidder. The bidder then has 10 days — not 10 business days — to file an appeal, either in court or pursuant to an administrative process that the public body has in place. Compliance with these time requirements is critical and the failure to do so will render the public body’s decision final (Sections 2.2-4357-4359).

A claim that an error has been made in a bid is not sufficient to withdraw that bid. A bid can only be withdrawn due to a good faith clerical mistake, rather than a judgment mistake, and which was due to an unintentional arithmetic error or unintentional omission of a quantity of work, labor or material. Such error has to be clearly shown by objective evidence from the original work papers (Section 2.2-4330).

An unsuccessful bidder might also protest the award or deci-sion to award a contract to another, but such a claim cannot be based on a claim that the successful bidder is not a responsible bidder. The disappointed bidder must submit its protest within 10 days after the award or the announcement of the award. In this circumstance, the unsuccessful bidder has not been served with a notice of the award, so he must be cognizant of when the award or announcement of the award has been made. Otherwise the time to file an objection may have passed by the time the disappointed bidder becomes aware of the award (Section 2.2-4330).

Contracting and resolution of disputesThe PPA also has certain requirements or limitations applicable

to all contracts.For all projects in excess of $100,000 the bidder/contractor

must provide bid, payment and performance bonds (Section 2.2-4336 – 4337).

The PPA voids any contract provision which seeks to bar a contractor’s claim for damages from unreasonable delay caused by acts or omissions to act of the public body, its agents or em-ployees and due to causes with their control (Section 2.2-4335). See also Blake Constr. Co./Poole & Kent vs. Upper Occoquan Sewage Auth., 266 Va. 564, 587 S.E. 2d 711 (2003).

Although this right is preserved by statute, that same provi-sion states a contractor can be liable for the costs incurred by a public owner for the investigation or litigation of a delay claim which is found to have been false or to have no basis in law or in fact. Similarly, the public owner can be liable to the contractor for costs incurred to pursue such a delay claim to the extent the claim has been denied by the public owner in bad faith.

The Virginia General Assembly has imposed certain procedures

Boyackluchini


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Workers’ Compensation General Liability • Roofers Program

Longevity. Stability. Reliability. These are the hallmarks of Builders Insurance Group. For over 16 years, we’ve delivered competitive prices, flexible coverage and technology solutions to our partners in residential and light commercial construction throughout the Southeast. Now, we’re pleased to bring our proven products and attentive customer service to Virginia.

Longevity. Stability. Reliability. These are the hallmarks of Builders Insurance Group. For over 16 years, we’ve delivered competitive prices, flexible coverage and technology solutions to our partners in residential and light commercial construction throughout the Southeast. Now, we’re pleased to bring our proven products and attentive customer service to Virginia.

The ppA applies to most Virginia state and local public construction projects and sets forth provi-sions applicable to their bidding, contracting and resolution of disputes.

and limitations on the processing and en-forcement of contract claims. “These are mandatory, procedural requirements which must be met in order for a court to reach the merits of a case Welding Inc. vs. Bland County Serv. Auth., 261 Va. 218, 541 S.E.

2d 909 (2001).”The PPA requires

a contractor to give written notice of its intention to file a claim at the time of the oc-currence or beginning of the work on which the claim is based. A contract claim must be actually submitted no later than 60 days after f inal payment, but the contract may very well require much more contemporane-ous filing.

The PPA requires each public body to

include in its contract a procedure to consideration of contractual claims. This procedure must establish a time within which the public body shall make a final decision on any such claim. Once a public owner has made a written “final decision” on a contractor claim, should the contrac-tor disagree, it must file an appeal of that decision within six months of the date of that decision.

A failure to timely appeal such f inal decision renders that decision f inal and binding on both parties. For projects last-ing a year or more, this provision often results in the parties being involved in disruptive dispute resolution at the same time the contract is being performed. In that event, the public owner is required to make a decision on that claim pursuant to a process established in or incorporated into the contract.

There are many provisions of the Vir-ginia Code which have specific application to public projects. Any contractor or sup-plier seeking to provide services or goods should be aware of those provisions and how they impact securing the work and the performance of that work.

(Joseph Luchini’s practice focuses upon all aspects of commercial litigation and dispute resolution with an emphasis on construction and real property issues. He can be reached at [703] 641-4274 or [email protected].) VAB


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Shenandoah Valley Builders Association

Tradition lives onOn the last Friday in April, SVBA continued its annual Arbor Day tradition by spon-

soring a tree-planting ceremony at the area’s newest health facility, Rockingham Memorial Hospital. SVBA member and local landscaper, Fine Earth, donated 30 mature trees along with the labor for planting.

As in years past, area third-graders were on hand for the dedication. Harrisonburg mayor, Kai Degner, and local retired JMU botanist, Norlin Botkin, made presentations on the history of Arbor Day.

HBAV local associations to hold 2009 parade of Homes

The following local associations in Virginia will host new home show-cases this fall:

Blue Ridge HBA – Parade of Homes, Sept. 26-27, Oct. 3-4. Out-of-town judges are needed for Tuesday, Sept. 22. (434) 973-8652, [email protected].

B&A of Central Virginia – Parade of Homes (tentative), Sept. 26-27, Oct. 3-4.

Fredericksburg Area BA – Parade of Homes, Oct. 3-4 and 10-11.

Peninsula HBA – Parade of Homes, Nov. 7-22. Judges are needed. Call Karen Robison or Katie Hayes at (757) 595-1600 by Oct. 1.

HBA of Richmond – Parade of Homes, Oct. 3-4, 10-11, 17-18.

Roanoke Regional HBA – Parade of Homes, Oct. 3-4, 10-11.

Shenandoah Valley BA – Parade of Homes, Oct. 3-4, 10-11. Judges are needed Tuesday, Sept. 29. (540) 434-8005, [email protected].

Tidewater BA – Homearama, Oct. 3-18. Judges are needed Sept. 30; [email protected].

Top of Virginia BA – Parade of Homes, Oct. 17-18, 24-25.

t Third-grade students from a local elementary school received saplings and lunch from SVBA in honor of Arbor Day.

s Fred and Donna Belka, owners of Tidewater Modular Homes in Virginia Beach, have been inducted into Nationwide Custom Homes’ Builder Hall of Fame.


2009 HBAV Build-PAC Honor Roll(as of May 29, 2009)

Thank You for Your Help!

GOVeRNOR’S CluBJeff ainslie/John ainslie, ainslie group, Tidewater BaJules elliott, Olde Colony Homes inc., Fredericksburg

area Badouglas r. Fahl, dewberry, northern Va BiaThomas Jordan, Carrhomes inc., northern Va BiaMak Koebig, Peak Construction Co. inc., Shenandoah

Valley Ba/Piedmont Biarobin newhouse/Pam Pekrun, dominion Virginia Power,

Fredericksburg area Ba/Tidewater Baginger Slavic-Jones, Craig Builders, Blue ridge HBaHenry H. Stephens, Personal, Peninsula H&BaScott Sterling, idi group Cos., northern Va BiaJohn d. Stokely Jr., Personal, northern Va BiaTidewater Ba

GeNeRAl ASSemBly CluBClem Carlisle, east West Partners, HBa of richmondrichard a. Coleman, Coleman Homes inc.,

Fredericksburg area BaSam Craig, Craig Builders, Blue ridge HBaBenjamin graham, The graham Cos., northern Va BiaC. richard napier, Personal, HBa of richmondVincent napolitano/John napolitano, napolitano Homes,

Tidewater Ba

CAPiTOl CluBdavid Blalock, FSK Management, Peninsula H&BaC. richard Bogese Jr., Personal, HBa of Southside VaJames l. Carver, James l. Carver Builder,

Fredericksburg area Baanthony Clatterbuck, graystone Homes inc.,

Piedmont Va Bialouis V. genuario Jr., genuario Cos., northern Va Bia louis Hale, Walsh, Colucci, lubeley, emrich &Walsh,

northern Va BiaHugh T. Mitchell, Personal, Ba of Southern VaFrederick napolitano/ richard Olivieri, Pembroke

enterprises inc., Tidewater BaMichael newsome, Clark Whitehill Co., Tidewater BaJohn Peterson, Terry Peterson residential Cos.,

Tidewater Barand Sompayrac, Personal, Fredericksburg area BaPreston Stallings, Personal, Blue ridge HBaWilliam g. Thomas/ Maureen Stinger, reed Smith llP,

northern Va BiaKenneth O. Thompson, Ken Thompson & associates

inc., northern Va Bia

CeNTuRy CluBTommy Balzer, Birthright Family ltd. Partnership,

HBa of richmondroy O. Beckner, S.W. rodgers Co., northern Va BiaShawn Callahan, Metwood Building Solutions, roanoke

regional HBaPamela Comstock/gilbert Martin, gilbert C. Martin Co.,

HBa of Southside VaKevin deChristopher, Mid-South Building Supply,

Top of Va Barichard entsminger, Personal, northern Va Bia

Bill garrett, W.B. garrett inc., HBa of richmondChip Hudnall, Chip Hudnall Custom Building inc.,

HBa of rappahannockJohn Olivieri, associated development Mgmt. Corp.,

Tidewater BaMark granville-Smith, Personal, northern Va BiaClark Massie, Tetra Corp., northern Va BiaCharles Miller, Miller Custom Homes, Tidewater BaJames Petrine, enirtep inc., roanoke regional HBadanny Plucinik, Cardan Homes, HBa of Southside VaJ.M. Snell ii, Valley renovations inc., Shenandoah

Valley Baroland Specter, Specter Construction, HBa of

Southside VaClement “Kim” Tingley, Tingley Construction Co.,

HBa of richmond

PARTNeRS CluBC. eugene Baker, C.e. Baker Construction inc.,

Peninsula H&Badavid Bomgardner, Personal, northern Va Biaron Boothe, Boone Homes, roanoke regional HBaWalter Cheatle Jr., Trigon Homes, Piedmont Va Biarichard Costello, aeS Consulting engineers,

Peninsula H&BaClaudia K. Cotton, Personal, Tidewater Badavid dunwody, Personal, Piedmont Va BiaPeter Fields, Fields Construction inc., roanoke

regional HBaBob Flynn, Personal, roanoke regional HBadon Haight, Full Services llC, Piedmont Va BiaWilliam Halprin, Personal, Tidewater BaChris Hargis, Kitchen & Bath ideas, Builders &

associates of Central VaJohn Hendrickson, John a. Hendrickson Construction,

HBa of rappahannockron Herring, The Home Crafters, HBa of

rappahannockTodd Holtzman, Holtzman Propane, Piedmont Va BiaWalt Hopkins, Cave Hill Corp., Shenandoah Valley BaJim Jackson, Superior equipment Sales inc.,

Tidewater Baron Johnson, Personal, Piedmont Va BiaPete Kotarides, Kotarides developers llC, Tidewater BaSteve lawson, The lawson Cos., Tidewater Balaura newman, newman Properties, Piedmont Va BiaJoe Miller, eJ Miller Construction Co., roanoke

regional HBadavid & Judy Milstead, Milstead Construction,

Shenandoah Valley BaKenneth Patterson, d.K. Patterson Construction,

Shenandoah Valley BaBruce reese, Personal, Fredericksburg area Baron Saunders, Personal, HBa of rappahannockTommy Shields Jr., Shield’s Construction Co.,

augusta HBag.H. Sturtevant, Wel-Vant Construction, Tidewater BaC. Warren Wakeland, HBa of richmondMike West, r.d. Wade Builder inc., Blue ridge HBaWendell a. White, Personal, Tidewater Ba

s Fine Earth, a member of the Shenandoah Valley Builders Association, recently won the U.S. Chamber of Commerce Small Business Award. Seen here, Chad Layman (right), owner of Fine Earth, accepts the award from Tom Donohue, U.S. Chamber president and CEO.

nAMES In THE nEwS

Costen Floors sweeps in awardsThe economy may be down, business may

be down, and profits may be down, but that’s not keeping Costen Floors down. In fact, the Richmond-based company was recently recognized by three totally different venues: the American Heart Association, National Wood Flooring Association and Floor Covering Weekly.

With physical inactivity becoming an increasing epidemic in our country, Ralph Costen, owner and president of Costen Floors, decided to implement a wellness program for his employees. Costen Floors now has a walking path, healthier snacks in its vending machines and an opportunity to meet weekly during business hours to measure its wellness success. By implement-ing various options to encourage physical activity, as well as nutrition and cultural enhancements, Costen Floors received the Start! Fit-Friendly Companies Award from the American Heart Association.

Costen Floors not only believes in im-proving the lives of its employees, but also believes in improving its community through volunteerism and contributions. Because of its ongoing community improvement efforts, Costen Floors was awarded the Community Service Award by the National Wood Flooring Association. It was one of only 30 companies recognized, and the only company in Virginia to achieve such an accolade.

Finally, Costen Floors was ranked 56th in the nation among specialty flooring retailers by Floor Covering Weekly, The Industry’s Busi-ness News & Information Resource. Costen Floors moved up an impressive eight slots


Advertisers’ index

AmeriGas ...................inside front coverAnthem .........................................................7Builders Insurance Group .....................9Builders Mutual ........inside back cover Costen Floors ........................back coverDemilec USA .............................................5Dominion .....................................................2Miss Utility ..................................................3Norandex/Reynolds ...............................10Screeneze .....................................................6

For more information on any of these advertisers, visit www.hbav.com and click on the Virginia Builder button to take you to the digital magazine with adver-tiser links.

arra brings changes to COBra by Jim Bonnell, luTCF, director of member benefit services

On Feb.17, President Barack Obama signed into law the “Stimulus Bill,” otherwise known as the American Recovery and Reinvest-

ment Act of 2009, which includes significant changes to the Consolidated Omnibus Budget Reconciliation Act.

COBRA allows workers and their de-pendents who lose their health benefits the option to continue their coverage under the health plan for a limited time. Usually, workers who elect to continue coverage can pay up to 102 percent of the premium an employer pays. To help alleviate this cost, the ARRA provides a subsidy to eligible individuals to assist in their premium pay-ments under COBRA.

Who’s eligible to receive the subsidy? An employee (and his/her spouse and depen-dent children) is eligible for the subsidy if the employee was involuntarily terminated from employment between Sept. 1, 2008, and Dec. 31, 2009, and is otherwise eligible for COBRA.

Under the act, the government will subsidize 65 percent of the total cost of COBRA premiums for the first nine months of continued coverage for those

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employer may permit an eligible individual to enroll in another plan for active employees offered by the employer, but the alternative coverage cannot have a higher premium than the coverage the individual had immediately prior to the termination of employment.

Notice requirements. Normal continu-ation of coverage notices must now include information on the premium assistance subsidy, and the Department of Labor will be issuing revised model COBRA notices. Notice of the special election period should have been sent to all eligible individuals by April 18, 2009.

limits on availability to high-income individuals. Up to a certain income level, the premium assistance subsidy isn’t taxable to the employee and dependents. Individu-als with a modified adjusted gross income of $125,000 ($250,000 for joint filers) will have the subsidy taxed in gradually in-creasing amounts until income is $145,000 ($290,000 for joint filers), at which point individuals must repay the entire subsidy. High-income individuals have the option to waive the subsidy.

Payroll tax credits. For employers, the subsidy will be a refundable payroll tax credit on the employer’s tax returns. Employers are allowed to offset any payroll tax liabilities. The Treasury Department/IRS has already amended Form 941 and has issued a FAQ for employers about the tax credit. Both Form 941 and FAQ can be found at www.irs.gov.

Required reports. The act requires at least three different reports for em-ployers:

1. An attestation of the involuntary ter-mination of employment of each covered employee;

2. The amount of payroll taxes offset for a reporting period and the estimated offsets; and

3. A report containing all social security numbers for all covered employees, the amount of subsidy paid to each person, and whether the subsidy was for one person or more than one person.

More guidance on how to comply with the new COBRA requirements is forthcom-ing. Interested employers should visit www.dol.gov and www.irs.gov. VAB

individuals. Eligible individuals only have to pay 35 percent of whatever the employer charges the individual to purchase continu-ation of coverage. Employers can recover their portion of premiums (65 percent) by withholding the payment as a credit against federal payroll taxes.

The premium assistance subsidy is avail-able for nine months. The subsidy will end before the nine months on the date the individual becomes eligible (not enrolled) for other health plan coverage.

example A:• Active employee premium is $1,000

per month. • Employer charges $1,000 per month

to purchase COBRA. • Individual will pay $350 (35 percent)

per month for COBRA coverage. • Employer will pay $650 (65 percent)

per month for COBRA coverage and be reimbursed via payroll tax credit.

example B:• Active employee premium is $1,000

per month.• Employer subsidizes COBRA and only

charges $500 per month for COBRA.• Individual will pay $175 per month (35

percent of $500) for COBRA.• Employer will pay the additional $325

per month (65 percent of $500), but will be able to be reimbursed for this additional $325 via payroll tax credit.

Subsidy does not equal extension of coverage period. The premium assistance subsidy and time frames for actual COBRA coverage run on two different tracks. The subsidy won’t affect the regular period of COBRA coverage by extending the time of coverage, which generally is 18 months after a qualifying event.

Under the normal COBRA rules, an individual loses eligibility for coverage after enrolling in another health plan. Individuals will lose the subsidy once they become eligible for other health plan coverage, even if they don’t enroll in that coverage. Individuals are under the obligation to report to the employer when their subsidy eligibility is expired.

election changes permitted. An


At A moment like this, Aren

,t you glAd you hAve Builders mutuAl?

Safety harness purchased from buildersmutual.com.

800.809.4859 www.buildersmutual.com

As the only insurance carrier devoted exclusively to builders, we’ve developed our own WorkSafe Fall Protection Program. Builders Mutual takes fall protection seriously – in fact, we even offer discounted “Safety Stuff,” like the harness above, through our website. Additionally, our policyholders have unlimited access to Builders University OSHA-approved safety courses, English/Spanish Fall Protection Certification, and our risk management CD containing valuable safety reference materials. Staying safe and productive is just a matter of having the right tools.

did you know that falls are the most frequent, severe, and preventable type of injury on a jobsite?


From the captivating beauty of natural hardwood floors, to the sleek

sophistication of ceramic tile and the cozy warmth of carpet, you’ll find the

flooring styles you love — installed with care you deserve — at Costen Floors.

STEP INTO OUR SHOWROOM AT 9840 MAYLAND DRIVE, BETWEEN GASKINS AND PEMBERTON. OR CALL 527-2929.

COSTENFLOORS.COM

FOR QUALITY AT EVERY STEP,

COUNT ON COSTEN FLOORS.

Costen.fp.c.my08.indd 1 4/16/08 3:14:44 PMCosten_fp_0209.indd 1 1/19/09 5:40:44 PM

2117 Smith Ave.Chesapeake, VA 23320

Documents

Virginia Builder July 2009