4 to Watch: Policy Expectations for the Year Ahead

At the Window & Door Manufacturers Association Spring Virtual Meeting and Legislative Conference in March, experts discussed what the next year might hold in regard to housing, labor, safety and health policy. Speakers agreed that COVID, climate and energy efficiency are most likely to influence much of the regulatory agenda in the coming year.

Housing Policy

“We’re very proud housing is a bright spot in the economy,” said Jim Tobin, VP of governmental affairs for NAHB, during a session. Strong though the numbers are, Tobin cautioned interest rates and regulatory barriers to construction must stay low for the residential market to continue so healthfully.

“We’re worried about a lot of regulations. There will be a re-regulation of America after deregulatory posture of the past four years,” he predicts. “Energy efficiency and climate change will color a lot of what this administration does.”  

Building-related policy to watch includes:

Energy

Department of Energy Secretary Jennifer Granholm aims to achieve net-zero carbon emissions by 2050, including “deploying a clean energy revolution to combat the climate crisis, create clean energy jobs and promote energy justice,” noted Jeffrey Inks, WDMA’s senior vice president, advocacy. Kevin McKenney, director of government affairs, WDMA, also said to keep an eye on the GREEN Act, which would provide incentives for renewable energy and energy efficiency, and CLEAN Future Act, which would achieve net zero greenhouse gas pollution no later than 2050.

Housing affordability

Tobin predicts the Biden administration and Congress will focus on “inequities in homeownership and how it’s affecting communities of color.” He notes: “There’s a lot of work to be done to help people get into homeownership.” Not only does affordable entry-level housing need to be addressed, he says, but also affordability for the first-time move-up buyer.

Nearly a quarter of the cost of single-family homes is directly attributable to regulation at the local, state and federal level, according to Tobin. “If we can get government to use the powers they have to incentivize localities to drive down the cost of regulatory burdens, that’s huge. It’ll help out on the ownership side of things. We need to find a way to keep people housed affordably.”

Net-zero and energy-efficient housing

More states are moving toward net-zero energy homes, Tobin says, which will likely increase the cost of homes. He argues, however, that retrofitting existing homes, especially pre-2000, of which there are tens of millions, could be more effective than focusing on the estimated 1.2 million single-family units that will be build this year, which are already more efficient than the homes being built even five years ago.

“If you want to talk about energy efficiency in the built environment, you need to find a way to retrofit existing properties,” he says. “We need to help people upgrade their existing properties. It’s easy to do when you’re building a home, but you’re driving up the cost of the project. There needs to be a steady progression through technology and code adoption, but also be mindful of the affordability equation.”

Tobin specifically referenced windows and doors as key areas to make significant energy upgrades, and hopes to see a more robust tax credit for homeowners that undergo those types of projects.

Lumber prices 

Lumber pricing is NAHB’s no. 1 priority, says Tobin. The rising prices have added $24,000 additional dollars to the cost of a newly built single-family home compared to one year ago. “It has the true potential to take housing recovery, and therefore national recovery, in a whole different direction and stymie anything coming out over the next six months. If lumber prices and supply chain issues don’t get resolved in the next couple months and home prices continue to escalate, no matter how low interest rates are, people will wait [to buy or build] and the market will cool completely off.”

The U.S. imports about 30 percent of its softwood lumber from Canada, but there is currently no softwood lumber agreement. As the administration focuses on the pandemic, however, Tobin doesn’t anticipate seeing movement on the trade front with lumber “anytime soon.”

Infrastructure

President Joe Biden unveiled a comprehensive $2 trillion infrastructure plan in late March that would address roads, bridges and address climate change, racial inequities, raising corporate taxes and more, as reported by the New York Times. Chuck Fowke, NAHB chairman, released a statement about the proposal, saying that, “NAHB commends President Biden for proposing a much-needed transportation and infrastructure plan for our nation that notes the important role that housing contributes to building strong communities. With the nation facing a housing affordability crisis, the plan recognizes the urgent need to build more affordable housing and retrofit existing homes to increase energy efficiency.”

Labor, Safety and Health Policy

Marc Freedman, vice president of employment policy at the U.S. Chamber of Commerce, looked ahead to several policy predictions manufacturers can expect.

OSHA and COVID

As of the WDMA meetings, OSHA was still under orders to create an Emergency Temporary Standard around COVID by March 15. Instead, OSHA opted to roll out a National Emphasis Program on March 12, a tool the agency uses on a temporary basis to address certain hazards in high-risk industries.

Freedman thinks the COVID-19 question plays in the OSHA agenda more than anywhere else. “The whole pandemic is a public health emergency; it’s not a workplace safety crisis,” he clarified. “It’s a public health emergency that happens to occur in the workplace, so you get an OSHA angle to it, but it’s not inherently a workplace safety issue. The real answer to the pandemic is everything outside the workplace, like vaccine programs, herd immunity and treatments. The OSHA efforts will be there, but the virus comes into the workplace from other sources.”

Labor employment

Tobin praised former President Trump’s promotion of the skilled trades, which he anticipates will continue under the Biden administration but with more emphasis on regulating employers, especially joint employers and independent contractors. Freedman also anticipates independent contractors will come under more scrutiny and encourages companies to ensure their independent contractor models are “air tight.”

The Protecting the Right to Organize (PRO) Act is also stirring conversation. The bill verbiage says it “expands various labor protections related to employees’ rights to organize and collectively bargain in the workplace.” The House passed the bill but McKenney says it is “unlikely” to pass in the Senate. Freedman said the Chamber is very opposed to the PRO Act, which includes language he says would “effectively eliminate the use of independent contractors.”

Leave and minimum wage 

The Chamber agrees that minimum wage should increase from the current $7.25 per hour, but disagrees with the proposed $15 per hour, saying it’s a politically, rather than economically, driven figure. “We haven’t aligned ourselves with a specific level yet,” he said. “There are good arguments for several approaches.”

Another area of focus could be paid family leave. States currently have their own versions of paid family leave, which can be especially difficult for employers with employees in several states. Freedman hopes to see a national platform and conversations about employees bearing some of the costs, similar to the unemployment compensation model.

See further information about WDMA’s National Policy Agenda.