BOMA International Advocacy Update - ICC Code Hearings, Tax Extenders, Lease Accounting Standard

BOMA Success at ICC Code Hearings

Public hearings to consider modifications to the next editions (2015) of five of the thirteen building codes published by the International Code Council (ICC) were held in Dallas April 28–May 7. The hearings were conducted by seven code development committees with their recommendations on more than 1600 proposals to be considered in a final action hearing this October. BOMA's Codes & Standards advocacy team was on hand to represent the interest of BOMA members and the entire commercial real estate industry. Several changes with potentially significant impact to our industry were on the agenda and BOMA, working with other real estate groups, was successful in gaining committee approval of our positions.

A sampling of the modifications of most concern includes:

• A group of proposals intended to harmonize the ICC codes with the revised ADA standards which became effective in March. BOMA supported these changes and they were approved with little opposition; 
• Installation of electronic water leak detection systems on all plumbing fixtures was opposed by BOMA and disapproved by the committee; and 
• Mandatory retrofit of firefighter breathing air replenishment systems in virtually every commercial building was also proposed. BOMA joined with the National Multi Housing Council in forging an agreement with fire service representatives and others to instead insert requirements for these systems into an optional appendix which must be adopted separately by jurisdictions. 

A complete report on the hearing results will soon be posted on the BOMA website. For more information, contact Ron Burton at ronburton@ptwadvisors.com.


Ways & Means Subcommittee Holds Hearing Addressing Tax Extenders

On Thursday, April 26, the House Ways and Means Subcommittee on Select Revenue Measures held a hearing which focused on the large number of tax "extenders" that Congress continues to pass on a short term basis, one or two years at a time. Most of the provisions were last extended through the "Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010" and expired at the end of 2011. The BOMA–supported, 15–year timeline for depreciation of leasehold improvements was part of this.

At the hearing, oral testimony was limited to Members of the House of Representatives who had either introduced or co–sponsored legislation related to tax extenders during the 112th Congress. Congressman Jim Gerlach (R – Pa.), lead sponsor of the leasehold depreciation permanency bill (H.R. 1265), spoke of the measure’s importance to the economy. BOMA International submitted a statement, as did the Depreciation Fairness Coalition, of which BOMA is a lead member, encouraging extension of the 15–year depreciation provision and stating the need for it to be made a permanent part of the tax code. It is still unclear when and if Congress plans to address the extenders. However, BOMA International continues to urge their retroactive extension as soon as possible.

Coalition Urges Re–Exposure of Final Lease Accounting Standard

In an April 26 letter, BOMA International, along with 27 other industry groups, urged the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) to, among other things, fully re–expose the final proposed leasing standard for comprehensive public input and comment. In addition, the letter expressed concerns over the Boards’ handling of lessees’ accounting for costs of leases formerly classified as operating leases and requested that an economic impact study be conducted prior to implementation. In a process that began nearly two years ago, FASB and IASB continue consideration of a new standard for lessees of commercial property and continue delaying the final standard, making it difficult to speculate when this process will be concluded.