CBIA President & CEO Responds to State of the State Address

Calls on Governor & Legislature to Take Immediate Action to Support Homeownership

Tuesday, January 8, 2008

SACRAMENTO – Today, California Building Industry Association (CBIA) President & CEO Robert Rivinius commended Governor Schwarzenegger for highlighting the importance of the homebuilding industry on the state and its economy. Additionally, Rivinius called on the Governor and the Legislature to take immediate action to support industry efforts to increase homeownership rates in the state as part of the solution to the State’s budget crisis. Rivinius stated:

“We’re encouraged that Governor Schwarzenegger mentioned the importance the homebuilding industry plays in California’s economy and in the state’s budget and his commitment to infrastructure investment.

We believe that by working closely with the Governor and the Legislature that we can achieve meaningful policy reforms that will boost the industry and help bridge the state’s deficit. Ignoring the impact of the homebuilding industry will only make things worse.

As the Governor and Director of Finance have stated, the housing slump is the single largest reason the state is facing a $14 billion deficit. And is the main reason that schools, cities and counties are hurting throughout the state.

In 2005 the homebuilding industry produced about 209,000 housing units and generated nearly $68 billion to the state’s economy and employed nearly 500,000 California workers.

But in 2007 only 112,000 new homes were constructed and the economic activity has decreased commensurately.

The good news is that by expanding homeownership opportunities the industry will rebound and generate additional tax revenues that will help improve the state’s budget outlook. Acting now will help the industry recover quickly, expand the tax base and drive revenue to bridge the deficit.

Specifically, CBIA is calling on the Governor and legislative leaders to pursue immediate action. 

  • The first thing policy-makers must do is make housing a priority and emphasize the importance of homeownership to the state
  • Second, we need policy reforms that will make homes more affordable, such as making more land available, streamlining environmental regulations and controlling outrageous fees that can reach well over $100,000 per home or condo!
  • Third we to take immediate steps to help the industry begin to climb out of its slump, such as extending expiring subdivision maps, allowing payment of impact fees at certificate of occupancy; and asking Congress to increase limits on federally guaranteed loans to better reflect California high-cost housing markets.

Pursuing these courses of action will improve our state’s economy and budget outlook, as well as help improve our dismal homeownership rate and make the American Dream a reality for more of our residents.

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The California Building Industry Association is a statewide trade association representing more than 7,000 businesses - homebuilders, remodelers, subcontractors, architects, engineers, designers, and other industry professionals. A recent study determined that homebuilding generates approximately $60 billion a year to the California economy and creates an estimated 526,000 jobs statewide. More information is available on the Association's Web site, www.cbia.org.