Congress enters certified wood controversy
Aletter signed by 79 members of Congress was delivered to the U.S. Green Building Council (USGBC) today, urging the agency to recognize a number of third-party wood certifications when awarding LEED credits. Lead by Rep. Bob Goodlatte (R-VA) and Rep. Kurt Schrader (D-OR), the Congressional letter carried the signatures of members of the U.S. House of Representatives covering 35 different states.
The letter urged the USGBC to “accept all credible forest certification systems for qualification under the LEED rating system,” including the Sustainable Forestry Initiative (SFI). Currently, most wood products are not recognized by LEED unless they are certified by the Forest Stewardship Council (FSC), leaving critics to argue that the FSC has a virtual monopoly on certified wood in LEED projects. LBM dealers also complain about the cost and limited availability of FSC-certified products. Meanwhile, environmentalists criticize the SFI program, which oversees the certification of the majority of lumber produced in the United States, as less environmentally stringent than the FSC program.
Along with the Congressional letter, the USGBC received a petition with 6,000 signatures, representing builders, architects, forestry experts, conservationists and tree farmers, among others. They also supported a wider playing field for “independent, respected and credible [wood certification] standards including SFI, ATFS, CSA, FSC and PEFC.”
When reached for comment, the USGBC said: “We appreciate the interest and value the opinions of all who have weighed in during our four public comment periods and in the numerous letters that we have received, but it is our members who will ultimately decide this issue. Some — but not all — of the 6,000 signers of the petition we received are members, and we will welcome their votes as we will welcome all members’ votes when the credit ultimately is balloted.”
Blish-Mize names new president
Blish-Mize, the Atchison, Kan.-based distributor, has named Jonathan D. Mize as its new president and chief operating officer, to succeed John H. Mize as the fifth-generation family member to serve as president.
John Mize will continue to be active in the management as CEO and chairman of the board.
Jonathan Mize has served as executive VP and VP sales. He is also president and COO of Hardware House, a subsidiary of Blish-Mize Co.
Other new officers include Lydia E. Funk, VP and controller, who had been corporate controller for MGP Ingredients of Atchison; and Douglas Long, VP sales and marketing, who has served in the same capacity with Bostwick-Braun, Tractor Supply, Pro Hardware and HDW Inc.
Founded in 1871, Blish-Mize provides more than 50,000 products to hardware stores, retail home centers, building material dealers, lumberyards and paint stores. It is a member of Distribution America.
Small business rallying cry: “Bonus depreciation”
The term “bonus depreciation” for tax deductions is something of a misnomer, according to Dan Fesler, CEO of St. Paul, Minn.-based pro dealer Lampert Yards. It sounds as if somebody’s getting something extra for free.
“In actuality, it makes depreciation match the true life cycle of a product,” Fesler said, in testimony before the U.S House Committee on Small Business yesterday.
Fesler, who also serves as chairman of the National Lumber and Building Material Dealers Association (NLBMDA), was one of a handful of small business representatives who argued before the committee in favor of the extension of bonus depreciation tax rules, allowing for businesses to recover the costs of capital expenditures more quickly. Bonus depreciation allows a business to take a 50% deduction for investments in new equipment and other capital expenditures.
“Bonus depreciation will stimulate sales of business capital investments, such as machinery and equipment, by helping customers who have buying needs and suppliers who have products to sell,” he said.
As an example, he pointed to the 235 computer terminals and 197 printers used by Lampert Yards, a 34-unit dealer that employs about 400 people. Under normal IRS rules, these are to be written off over five years — but they only last about three years on average.
“Giving a company the ability to write things off as they age and before they become obsolete would encourage the purchase of newer equipment on a more frequent basis and would assist in stimulating the economy and providing more jobs for companies selling these types of products and equipment to businesses such as Lamperts,” he added.
Atemporary 50% bonus depreciation rule lapsed at the end of 2009 and has not been restored. A bill working its way through the Senate contains a provision extending the 50% bonus depreciation tax deduction, but a bill passed in the House last month does not include the provision.
Fesler’s comments found a receptive audience in Nydia Velazquez (D-NY), the committee chair. “This is the kind of economic activity we need to foster widespread job creation,” Velazquez said. “As noted in the 2010 Economic Report of the President, a true recovery from the current recession will be driven by business investment. This just underscores why bonus depreciation is necessary — and why it has generated $10 billion to $20 billion in purchases, while helping sustain or create 100,000 to 200,000 jobs.”
In his testimony, Fesler described the challenges facing businesses in the LBM space, pointing to seven facility shutdowns and 418 layoffs or terminations at Lamperts since the decline of the housing market. Over the same time, costs have increased. In addition to healthcare costs, government regulations such as IRS rule changes and loss of deductions, EPA regulations, and increased OSHA oversight and regulations are making operations more expensive, he said.
“The weak housing sector continues to send ripple effects throughout the country, which is putting a severe strain on both large and small businesses nationwide,” he said. “Our nation’s lumber and building material dealers are on the front lines of this crisis, and many unfortunately have had to permanently shut their doors as a result.”
The provision’s built-in stimulus will help the LBM industry and the economy in general, Fesler said.
The proposal has received an unusual level of bipartisan support, Fesler said. It recently was pushed by 11 Democrats and seven Republicans in a letter to the House Ways and Means Committee. Extending the bonus depreciation provision for one year is also being recommended by President Obama.
In addition to Fesler, the witness list for the meeting, which was titled “Bonus Depreciation: What it Means for Small Business,” also included Jack Sanford, president of Charlottesville, Va.-based Faulconer Construction and Dennis Vander Molen, president of Vermeer MidSouth of Jackson, Miss.