For better or worse, builder-related referendums aren't appearing on many ballots this Election Day. "The big story for ballot propositions this year is the surge of social issues," according to the Initiative and Referendum Institute at the University of Southern California. "Tax and spending issues that normally dominate initiatives are taking a back seat in November to a diverse collection of social issues."

There are exceptions, of course. In Nevada, voters will consider a land use question that limits the use of eminent domain for private benefit. Oregon voters will get to decide whether building projects costing less than $35,000 need a building permit. Many states have measures on the ballot addressing renewable energy use.

But the hot seats for builders in terms of ballot issues appear to be in Georgia and Arizona.

Georgia
In Georgia, builders are advocating the passage of a constitutional amendment that would allow localities to establish independent infrastructure districts (IDDs) that shift the costs of new infrastructure from local governments and existing taxpayers to those who buy property within the infrastructure district.

"Cities and counties don't have the funds to create infrastructure," says Suzanne Williams, vice president of government affairs for the Home Builders Association of Georgia, which has been working for several years to get this on the ballot. "This is a tool for counties that need to bring in industry."

However, the measure does not appear to be heading for easy approval. "The Atlanta papers, which are very liberal, have been asking people to oppose it," observes Williams. "People just don't understand it."

Part of that may be due to the language. While the IDD proposal is a constitutional amendment, it would not be mandatory for cities and counties. Localities would need to choose to designate an area as an IDD. But that's part of the controversy; opponents see the measure as creating "private cities," where the infrastructure is paid for and enjoyed only by the district's property owners and residents. State law, however, would consider the infrastructure public and available to all.

Arizona
Arizona builders are facing an issue of a different kind: Proposition 201, which would establish new provisions for home builder disclosure, establish 10-year warranties for new homes, give buyers up to 100 days to cancel a new-home contract, and shorten the time for builders to fix any defects, among other issues.

The ballot measure, called "Homeowners' Bill of Rights," has been vigorously opposed by the Home Builders Association of Central Arizona, which asserts Proposition 201, despite its provisions, is less about helping homeowners than it is about putting political pressure on builders.

According to Spencer Kampps, vice president of legislative affairs for the Home Builders Association of Central Arizona, Proposition 201 was financed by a labor union interested in bringing collective bargaining to a construction industry contractor and wanted the HBA's assistance. When the HBA declined to get involved in the effort, Proposition 201 emerged as a political force. "Consumers are not their target," Kampps says.

He points out that Arizona in 2002 passed with bipartisan support a right-to-repair act that provides for a 90-day mediation process for resolving construction defect issues while protecting a consumer's right to litigate. "If agreement is not reached in 90 days, the homeowner can sue. If a builder fails to meet its obligations at any time during the 90 days, the homeowner can sue."

Proposition 201 tosses that work out the window, according to Kampps. "It bans arbitration. It throws everyone into court, which means people will have to wait two to three years to get their $15,000 repair fixed. It's crazy."

Obviously, he hopes Arizona voters will not approve Proposition 201. "This is lawsuit abuse and will lead to more frivolous lawsuits. I believe the voters are smart enough to get that."

Alison Rice is senior editor, online, at BUILDER magazine.

 

Learn more about markets featured in this article: Atlanta, GA, Phoenix, AZ.