Obama wins election
Barack Obama was elected as the 44th president of the United States in heavy voting yesterday. The latest electoral tally stood at 338 votes for Obama and 161 for his rival John McCain. Obama’s reported views on housing, taxation and small business were presented on the campaign trail, and represented here.
Troubled Asset Relief Plan (TARP)
Obama has called for greater oversight of Wall Street, and assurances that taxpayers will benefit from the $700 billion TARP. He also supported limiting the pay of executives from the companies being bailed out. He has expressed support for homeowners in danger of foreclosure and reiterated the need for a stimulus package of tax cuts.
Obama has proposed a 10 percent universal mortgage credit to provide tax relief for what his campaign estimates are around 10 million homeowners in income brackets under $50,000 per year. He has also supported the Stop Fraud Act for several years, a proposal that includes various reforms meant to protect consumers from “abusive” lending practices, and also supported mandating accurate loan disclosure, including a simplified borrower metric — described as similar to the APR — for home buyers, called the Homeowner Obligation Made Explicit (HOME) score.
Obama’s proposals include a tax cut of $500 per person or $1,000 per couple for most families, but letting President Bush’s tax cuts lapse for those making $200,000 or more a year and raising the capital gains tax rate for big companies.
Obama has proposed a tax relief plan for small businesses and start-up companies that will include elimination of all capital gains taxes on those types of businesses, with the aim of encouraging innovation and job creation. His campaign’s $50 billion “Obama-Biden Relief Plan” would include the creation of a $25 billion Jobs and Growth Fund. He also has pledged to make the Research and Development Tax Credit permanent.
Obama has proposed a plan with the goal of creating 5 million “Green Collar jobs,” including jobs related to a plan to weatherize one million low-income homes annually, part of an over-arching energy-savings initiative that supports green building. The campaign also has voiced a plan to increase funding for federal work force training programs, while directing them to incorporate training on “green technologies.”
Big-box construction firm files Chapter 11
March Associates, a commercial construction firm that built several Home Depot and Lowe’s stores in northern New Jersey, has filed a voluntary petition for Chapter 11 reorganization. The Wayne, N.J., firm listed assets of $5.9 million and liabilities of $4.8 million in its court filing.
Sloan & Co. of West Caldwell, N.J., an interior finishing company, holds the largest unsecured claim of $1.17 million. Also listed among the unsecured creditors is the Lakewood, N.J., branch of Ferguson, a division of Wolseley, with $190,943 in unpaid debt.
An attorney for March Associates told the Herald News that a dispute over a luxury condo project held up a $6 million payment to March Associates. After subcontractors began obtaining judgments against the construction firm for non-payment, the company was forced to file for bankruptcy protection to keep its creditors at bay, the lawyer said.
In addition to building big-box stores, March Associates was also known for erecting large shopping centers and public works projects such as the 42,000-square-foot municipal recreation center in Fair Lawn, N.J.
True Value revenue, profits rise in third quarter
Despite the depressed economy and home market, True Value reported positive results for the third quarter ending Sept. 27, including revenue of $493.1 million for an increase of 3 percent — or $14.6 million — from $478.5 million for the same period a year ago.
Comp-store sales to members rose 0.5 percent in the quarter, driven primarily by an increase in the lawn and garden category. New store revenue exceeded lost revenue from member terminations by $8.8 million in the quarter, which the co-op attributes to the success of the new Destination True Value format.
True Value posted a quarterly net margin of $20.5 million, an increase of 70.8 percent, or $8.5 million, versus $12 million a year ago. The profit increase was the result of higher sales, a higher gross margin rate, continued control of overhead expenses and the effect of $1.7 million of non-recurring expenses in 2007 related to a facility lease and a legal matter.
“I am pleased with the strength of our third-quarter financial performance,” said president and CEO Lyle Heidemann. “Positive comp-store sales growth and the opening of 14 new True Value stores in the third quarter is a very positive statement about the health of the co-op given the condition of the U.S. economy.”
Compiled results for the first three quarters of 2008 were not as positive. For the nine months ending Sept. 27, True Value reported revenue of $1,529.2 million, a decrease of 2.1 percent, or $32.2 million, from $1,561.4 million for the same period a year ago. Comp-store sales to members decreased 2.5 percent year-to-date. Categories with the largest declines include hand and power tools, seasonal, paint and electrical. New store revenue exceeded lost revenue from member terminations by $2.4 million for the year-to-date.
The 2008 year-to-date net margin was $44.2 million, down 7.3 percent, or $3.5 million, from $47.7 million in 2007. The year-to-date profit decline was driven primarily by lower sales volume and higher fuel costs, offset in part by $2.9 million in recoveries related to arbitration proceedings.
“Clearly, the Destination True Value store format has been well received by our retail members and consumers, alike,” said Heidemann. “The solid performance of these stores played a part in offsetting the impact of the slowing economy and the unfavorable sales comparison of a late spring in many areas of the country.”