buildersoutlookissue10 2013

Builders utlookwww.elpasobuilders.com www.epbuilders.org

2013issue 10

With home prices and household

formations rising and household

balance sheets healing, the ongoing

housing recovery is expected to gain

momentum next year even as several

challenges remain, according to

economists who participated in

yesterday’s National Association of

Home Builders (NAHB) Fall 2013

Construction Forecast Webinar.

“The cards are in play for a decent

and fairly strong recovery in 2014 and

particularly in 2015,” said NAHB Chief

Economist David Crowe. “From the

standpoint of GDP growth, housing has

been a plus, growing at two, three and

four times the rate of the rest of the

economy in recent quarters.”

Helping to spur the housing rebound

was a double-digit increase in home

prices over the past year, driven in part

by tight inventories of new and existing

homes for sale and gradual gains in

employment.

“We expect to see price increases

moderate in the next few years as we

see additional inventory on the market

and investors back away as the

bargains disappear,” said Crowe.

Another bright spot is rising household

formations that were delayed during the

downturn as college graduates and

young professionals were forced to

move back in with their parents or

double up as roommates. At the height

of the housing boom, the U.S. was

producing 1.4 million additional

households every year. That figure

plunged to 500,000 during the depth of

the recession and today is now back up

to 700,000.

Meanwhile, households across the

nation have been increasing their

savings and shedding debt. “They’ve

corrected a lot of excesses and feel

more comfortable about moving

forward,” Crowe said, noting that the

University of Michigan Consumer

Sentiment Index shows that the

percentage of consumers who believe

that now is a good time to buy a house

is back up to levels last seen near the

housing boom.

However, Crowe cited several

headwinds that are impeding the

recovery.

“Credit conditions are much tighter

now, builders are increasingly facing

labor shortages, lot supplies are tight,

building material prices are rising, and

inaccurate appraisals are hurting home

sales” he said.

“You can’t charge more than you can

get an appraisal for,” Crowe added.

“Even though we are seeing price

increases in labor, land and materials,

36 percent of builder recently said they

had lost at least one sale over

appraisals coming in below the cost of

production.”

A Solid Outlook

NAHB is forecasting 924,000 total

housing starts in 2013, up 18 percent

from 783,000 units last year.

Single-family production is expected

to rise 17 percent this year to 629,000

units, jump an additional 31 percent next

year to 826,000 and surpass the 1

million mark in 2015.

NAHB is projecting that multifamily

starts will increase 20 percent in 2013 to

296,000 units and rise an additional 10

percent to 326,000 units next year,

which Crowe characterized as a normal

level of multifamily production.

Meanwhile, residential remodeling

has returned to previously normal levels

of the early 2000s and remodeling

activity is expected to register a modest

gain this year over 2012.

“Our Remodeling Market Index has

been above 50 for three of the last four

quarters, indicating that remodelers feel

things are going better,” said Crowe.

“Remodeling did not fall as much, so it

does not have as much ground to make

up.”

Dodging a Bullet

Regarding the uncertainties

emanating out of Washington over the

government shutdown and the

impending Oct. 17 deadline when the

government will run out of cash to pay

its bills, Mark Zandi, chief economist at

Moody’s Analytics, expressed optimism

that Congress will move quickly to

resolve these critical issues.

“I truly anticipate that lawmakers will

get it together, but that is definitely a

challenge to my economic outlook,” said

Zandi. “If policymakers can’t get it

together by Oct. 17, we’re toast, and I

think we are going into recession.”

Assuming the government meets

these challenges, Zandi cited three

reasons for optimism moving forward.

First, the fiscal drag that is weighing

heavily on the economy in the form of

tax increases and government spending

cuts that are now being implemented

will continue to fade in the coming years.

This fiscal drag will shave 1.5 percent off

of GDP growth this year, about 0.7

percent next year and gradually fall to

zero by 2016, he said.

Second, Zandi noted that the “private

economy has done a marvelous job of

reducing leverage and getting their

balance sheets in order. American

companies are in very good shape and

they will do well going forward, with

continued strong export growth.

That will be a strong source of

economic growth for a long time to

come.”

Finally, Zandi said that demographics

make a compelling argument for a

strengthening housing market.

“In the current housing market, supply

is running around 950,000 annual units,”

he said. “In a normal economy, we

should be producing 1.7 million units.

That’s a big difference. We’ve already

made a lot of progress in working off

excess inventory. We won’t get housing

construction up to 1.7 million quickly.

The big problem in the next five years

won’t be too much housing, but too little

housing.”

All Markets Are Local

Looking beneath the national

numbers, Robert Denk, NAHB’s

assistant vice president for forecasting

and analysis, noted a range of

conditions across the country and

differences among the states in the

amount of distress suffered during the

recession and the headway that is being

made in recovery.

Housing nationwide bottomed out at

an average of 27 percent of normal

production in early 2009.

The hardest hit states where

production soared to unsustainable

levels during the boom years --

California, Nevada, Arizona and Florida

-- bottomed out at 10 percent to 20

percent of normal when the housing

bubble burst. In sharp contrast, better

states that did not experience a huge

production run up during the boom

declined to 50 percent of normal

production.

“We’ve now gotten past the point

where we are digging out of holes and

repairing the carnage of the housing

markets,” said Denk. “It’s no longer

about the boom and the bust. Now it’s

about the underlying [state and regional]

economies and how that is supporting

the housing recovery.”

For example, while Texas and Florida

have roughly the same number of

mortgages, Florida had nearly five times

as many foreclosures during the height

of the downturn and today has less than

double.

Now that housing has entered a new

stage in the healing process, local

economic conditions are dictating the

pace of recovery.

“That’s why the bubble states are no

longer in the bottom tier and have

moved ahead of the industrial Midwest,”

he said.

The gradual and steady housing

recovery now underway across the land

will bring nationwide housing starts to 71

percent of normal by the fourth quarter

of next year and 93 percent of normal by

the end of 2015, Denk said.

Leading the way will be oil and gas

producing states Texas, Oklahoma,

North Dakota, Louisiana, Wyoming and

Montana; and Iowa, supported by

agricultural commodities.

In another way of looking at the long

road back to normal, by the end of 2015

the top 20 percent of states will be back

to normal production levels, compared

to the bottom 20 percent, which will still

be below 84 percent.

Housing

Recovery

Picks Up

Steam Despite

Persistent

Headwinds

2 Builders Outlook 2013 issue 10

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President’s Message |

El Paso Disposal

772-7495

32013 issue 10 Builders Outlook

Edmundo

Dena

President,

El Paso Association

of Builders

Showroom: 2131 Missouri

915 • 533 • 6045 fax • 533• 6096

Thomas R. Brown, Owner

The GEICO commercial with the camel asks “what day is it”? The

answer is hump-day, what we call mid-week or Wednesday. Well my

friends, my presidency’s hump day was just a short few months ago

and now I see the end of the year coming closer and closer. We have

accomplished quite a bit during my term thanks to dedicated team that

I’ve been lucky to surround myself with. Two months to go. Sounds

like around the corner but we still have a lot to do.

Both Ray and I along with Randy Bowling, Greg Bowling and Frank

Torres will be in Austin for Texas Builders meetings in November, right

before Thanksgiving. It’ll be my final “official” visit on behalf of the

EPAB and I’m excited to go. We’ll have the election of officers and

board at our November 12 meeting here in El Paso and we’ll welcome

a new slate of officers at our installation in December. So while I think

about all those things I want to remind you that we still have work to do.

Politics, regulations and just getting through the mess we see from

Washington affects us 24/7. As President I’ve gotten close enough to

the action to know how important this association is and how relevant it

has become. When you have coffee with your vendors or other

builders ask them to join. We need them now more than ever, and so

do you.

It has been a little more than 100

days since the new Mayor and City

Reps took office. So far the perception

of the public seems to be positive with

a minor hiccup on the city budget and

raising of city taxes. While the taxes

were relatively small ($28 per

year/$100,000) it was made clear that

raising taxes does not sit well with

anyone right now.

For the newcomers (Mayor, Lilly

Limon, and Larry Romero) who were

pushed into budget reviews the lessons

are harsh but lessons they will use

every year they are on council. Now

that the honeymoon is over the reality

of the office is starting to settle in and

so far it seems that the newbies are

adjusting. We will see where they draw

some lines in the coming months as

issues surrounding the massive costs

of moving city offices starts to be

clearer and the search for a new City

Manager begins.

Joyce Wilson announced that she

will be leaving the City Managers post

when her contract expires in

September of 2014. That’s actually a

good thing for the city as termination

would have cost several hundreds of

thousands of dollars payout to Ms.

Wilson, so by her resigning or

completing her contract the only

amount owed to her will be her

contracted pension of $60,000 a year

for life. (I need to find out who her

agent is). One thing is certain; our

version of the Iron Lady has done a

good job transitioning the city from

strong mayor to city manager type of

control. My perception is that while not

all of her moves have been good for us

I would challenge anyone to have done

better given who she had to work with

on City Council and in the Mayor’s

seat. Ms. Wilson was directed by self-

serving interests and that put some real

pressure on her since her position

reports to City Council. I would ask that

as you review her job you remember

who she answered to. We will work

with the new council and Mayor to

ensure that the next City Manager

understands the importance of a strong

new home construction industry in El

Paso. We will be vocal in our choice

and we will serve notice to that.

The last quarter of the year is upon

us and soon we will have a new sitting

President and Board of Directors. I

would like to thank all of those

members who have agreed to lead this

association. It is not a task that is easy

and one that carries risk by the mere

fact that the Board is the responsible

party who puts their neck on the line for

the association. Our leaders are good

leaders and fortunately we have good

people to choose from. At the

November board meeting the 2014

Executive Officers and Board will be

elected and on December 13 those

same members will be installed to take

over the reins on January 1. What an

exciting time for the association.

I’d also like to thank the following

members for their service on the

Capital Improvements Advisory

Committee for impact fees, working

with PSB and other city agencies.

Bobby Bowling, IV, Mark Dyer, Sal

Masoud and I have been on this board

since 2008. Bobby and I will be termed

out this month along with a couple of

other appointees. Bobby served as

chairman and frankly was the one

person we all turned to with questions

on the state law governing this

committee. He knows his stuff and

proved once again that involvement is

the key to understanding and to being

on top of issues dealing with the law.

He is one smart guy and every builder,

developer and vendor owes Bobby a

really big round of thank you’s for his

unselfish job on the committee. Well

done Bobby.

Finally I’d like to say thanks to all of

the dozens of members who continue

to make this year a very productive

year for the association. We still have

November and December but if it

wasn’t done by now we’d be left in the

dust. Thank you again, see you at the

Halloween bowling event and the

upcoming Pro-am golf tournament.

Perspective

Ray Adauto,

Executive Vice PresidentEPAB


First 100 days of city government, search for new manager begins


NAHB Estimates Sept.

Housing Starts will

Approach 900,000 Units From NAHB

Builder confidence in the market for newly

built, single-family homes fell two points in

October from a downwardly revised reading in

the previous month to a level of 55 on the

National Association of Home Builders/Wells

Fargo Housing Market Index (HMI) released

in October.

“Builder optimism remains above 50 and we

are still seeing signs of pent-up demand in

many markets across the country,” said NAHB

Chairman Rick Judson, a home builder from

Charlotte, N.C. “This slight dip in builder

sentiment is the result of continuing challenges

in the marketplace with regard to the cost and

availability of labor and lots and uncertainty in

Washington”

“A spike in mortgage interest rates along

with the paralysis in Washington that led to the

government shutdown and uncertainty

regarding the nation’s debt limit have caused

builders and consumers to take pause,” said

NAHB Chief Economist David Crowe.

“However, interest rates remain near historic

lows and we don’t expect the level of rates to

have a major impact on sales and starts going

forward. Once this government impasse is

resolved, we expect builder and consumer

optimism will bounce back.”

Derived from a monthly survey that NAHB

has been conducting for 25 years, the

NAHB/Wells Fargo Housing Market Index

gauges builder perceptions of current single-

family home sales and sales expectations for

the next six months as “good,” “fair” or “poor.”

The survey also asks builders to rate traffic of

prospective buyers as “high to very high,”

“average” or “low to very low.” Scores from

each component are then used to calculate a

seasonally adjusted index where any number

over 50 indicates that more builders view

conditions as good than poor.

All of the HMI’s three components each fell

two points in October. The component gauging

current sales conditions registered 58, while

the component gauging sales expectations in

the next six months posted a reading of 62 and

the component gauging traffic of prospective

buyers was 44.

Looking at the three-month moving

averages for regional HMI scores, the South

held steady at 56, the West declined a single

point to 60 and the Northeast fell three points

to 38. The Midwest posted a one-point gain to

64.

NAHB Estimates Housing Starts Approach

900,000 Units in September

** With the partial shutdown of the federal

government preventing the U.S. Census

Bureau from releasing a housing starts

estimate for September, NAHB has prepared

its own.

NAHB estimates that the seasonally

adjusted annual rate of construction for single-

family homes was between 620,000 and

630,000 units in September.

NAHB estimates that the pace of

construction of multifamily units was an

additional 255,000 to 270,000, bringing the

anticipated pace of total housing starts in

September to between 875,000 and 900,000

units.

“The NAHB estimate of 875,000 to 900,000

total housing starts is based on continuing

improvement in single-family starts and

ongoing volatility in multifamily construction,”

said Crowe.

“Single-family starts dipped in July but

rebounded in August, and we expect

continued strength in September,” Crowe

added. “The Fed meeting in mid-September

provided additional relief to builders and

buyers that interest rates would remain near

historic lows for the immediate future,

encouraging consumers back into the housing

market.

“Meanwhile, multifamily starts have been

unusually volatile since the beginning of the

year, swinging between 250,000 and 400,000

units from month-to-month. We expect some

bounce back from the August pace of 263,000

as multifamily starts continue to trend around

300,000 units.”

New Index Shows Housing

Markets Back to Normal in

52 Metros Housing markets in 52 out of the

approximately 350 metro areas nationwide

have now returned to or exceeded their pre-

recessionary levels of activity, according to the

newly minted National Association of Home

Builders/First American Leading Markets

Index (LMI), released today. The index’s

nationwide score of .85 indicates that, based

on current permits, prices and employment

data, the nationwide housing market is running

at 85 percent of normal activity.

Baton Rouge, La., tops the list of major

metros on the LMI, with a score of 1.41 – or 41

percent better than its last normal market level.

Other major metros at the top of the list include

Honolulu, Oklahoma City, Austin and Houston,

Texas, as well as Harrisburg, Pa. – all of

whose LMI scores indicate that their housing

markets now exceed previous norms.

Looking at smaller metros, both Odessa

and Midland, Texas, boast LMI scores of 2.0 or

better, meaning that their housing markets are

now at double their strength prior to the

recession. Also at the top of the list of smaller

metros are Casper, Wyo.; Bismarck, N.D.; and

Florence, Ala., respectively.

“This index helps illustrate how far the

U.S. housing recovery has come, and also

how much further it has to go as we continue

to face some significant headwinds in terms of

credit availability, rising costs for lots and labor,

and uncertainties regarding Washington

policymaking,” said NAHB Chairman Rick

Judson, a home builder from Charlotte, N.C.

The LMI shifts the focus from identifying

markets that have recently begun to recover,

which was the aim of a previous gauge known

as the Improving Markets Index, to identifying

those areas that are now approaching and

exceeding their previous normal levels of

activity. More than 350 metro areas are scored

by taking their average permit, price and

employment numbers for the past 12 months

and dividing each by their annual average over

the last period of normal growth. For single-

family permits and home prices, 2000-2003 is

used as the last normal period, and for

employment, 2007 is the base comparison.

The three components are then averaged to

provide an overall score for each market; a

national score is calculated based on national

measures of the three metrics. An index value

above one indicates that a market has

advanced beyond its previous normal level of

economic activity.

“Smaller metros are leading the way to a

housing recovery, accounting for 43 of the top

50 markets on the current LMI,” observed

NAHB Chief Economist David Crowe. “This is

very much in keeping with the results of our

previous index for improving markets, and is

an indication of the extent to which local

economic conditions dictate the strength of

individual housing markets.”

“The housing markets of 118 metros scored

by the LMI this month show activity levels of at

least 90 percent of their previous norms – a

very encouraging sign of things to come,” said

Kurt Pfotenhauer, vice chairman of First

American Title Insurance Co., which co-

sponsors the LMI report.

Editor’s Note: In calculating the LMI, NAHButilizes employment growth data from theBureau of Labor Statistics, house priceappreciation data from Freddie Mac andsingle-family housing permit growth from theU.S. Census Bureau. The LMI is published onthe fourth working day of each month, unlessthat day falls on a Friday -- in which case, it isreleased on the following Monday.

Industry News

72013 ISSUE 9 Builders Outlook

Builders utlook on the scene |

The October general meeting

featured guest speaker Gerald

Cichon, CEO of the El Paso

Housing Authority. Mr. Cichon

gave the assembled audience

some insights into why and how the

EPHA operates and the challenges

it faces. Over 60 people attended

the meeting that was held at the El

Paso Club. Special recognition

was given to Cindy Bilbe, President

of Stewart Title El Paso, who was

recognized by Junior Achievement

El Paso as one of the top

Professionals in El Paso.

Congratulations to Cindy from the

EPAB.

of Texas

TM

+

General Meeting

el paso development news

CRRMA Readiesfor Opening ofToll Lanes

Drivers Can UseBorder Highway Lanesin December

Sun Bowl Drive Project Moves Into Full GearConstruction Will Last Through July 2014

The “managed” toll lane will bethe innermost lane in each direc-tion. Rates per mile will varybased on congestion and thetime of day. (CRRMA

After years of construction, El Paso driv-ers will get to choose whether or not to use“managed” toll lanes on the Cesar ChavezBorder Highway in December when con-struction is expected to be complete. Andnow the Camino Real Regional MobilityAuthority (CRRMA) is preparing to educatethe public about how the toll program willwork.

The CRRMA board will review a presen-tation on the Cesar Chavez ManagedLanes Project at its meeting this week thatwill include details on the toll collectionprocess and the marketing outreach thatwill roll out in the coming months.

Drivers on the nine mile stretch of theBorder Highway between US-54 and theZaragoza Port of Entry will still have twofree lanes to use, while the additional toll

lane will be the left-most lane in each direc-tion.

Pricing for use of the toll lanes will varybased on the time of day, starting at a baserate of $0.10 per mile. The minimum toll forany trip will be $0.40. Large trucks andtrailers will be unable to use the toll lanes,while emergency and public transit vehicleswill be exempt from tolls.

There will be two tolling points in eachdirection, between Midway Drive andYarbrough Drive, and between Yarbroughand Padres Drive. Entrance and exit pointswill favor drivers taking longer trips withonly two exits from the toll lane for east-bound travelers, one before YarbroughDrive and another before the ZaragozaPort of Entry.

The Border Highway has been

widened to accommodate the new tolllanes. There is still a 10-foot inside-shoul-der in each direction. The toll lanes will beseparated from the free main lanes by atwo foot buffer.

Collection of tolls will be an electronicprocess with no actual payment infrastruc-ture on the highway. Sensors will scanvehicles for a toll tag for those that are reg-istered with a toll service and bill the driveraccordingly. Cameras will be used to cap-ture license plate information for non-regis-tered drivers who decide to use the tolllanes. A bill will be sent to the address ofthe vehicle’s registered owner.

The CRRMA expects to spread thenews about the new toll lanes via storieson various news stations, broadcast adver-tising on television, radio, and billboards,

and through “grass roots efforts” involvingelected officials and community meetings.

At least two other managed lane projectsare in the works. The Americas ManagedLanes Project will continue the CesarChavez toll lanes at the eastern terminusfrom the Zaragoza Port of Entry north toBob Hope Drive on El Paso’s East Side.And the massive Border Highway Westproject will create a brand new tolledexpressway from Downtown El Paso to thecity’s West Side.

The CRRMA will discuss the presenta-tion at its October 9, 2013 meeting. Moreinformation can be found atwww.crrma.org.

Work to widen Sun Bowl Drive into afour-lane thoroughfare at the University ofTexas at El Paso (UTEP) is in full swing ascrews have put protective barriers in placeto protect passing vehicles from debris.Construction workers are “chipping away”at the rocky mountain on the westernshoulders of Sun Bowl Drive according tothe school’s On the Move website(www.onthemove.utep.edu).

The $4.8 million project will widen theroadway, construct five-foot sidewalks oneach side, and install enhanced lightingalong a half-mile stretch of Sun Bowl. The

outside lane in each direction will also bewider than usual to allow for bicycle traffic.A roundabout will help control traffic at theroadway’s intersection with Glory Road.

“You’ve all undoubtedly noticed that thewidth of Sun Bowl Drive varies from twolanes to four, and that the remaining two-lane stretch creates a bottleneck and asafety risk,” UTEP President DianaNatalicio stated during groundbreaking forthe project on September 16, 2013, point-ing out the issues with traffic caused by thereduced lanes.

The school’s Campus Transformation

may add to Sun Bowl Drive’s importance inhandling traffic traveling around the cam-pus; one of the Transformation’s goals is toremove vehicular traffic from the innercampus.

Sun Bowl Drive will remain open duringconstruction, but officials urge caution dueto shifted, temporary lanes. Drivers shouldexpect delays.

Officials expect the project to last tenmonths, which means completion in July2014.

The Paul L. Foster School of Medicinecampus will get a major new addition by2015. Groundbreaking for the new GayleGreve Hunt School of Nursing buildingtook place last month.

Construction crews are now laying thefoundation for the 34,000 square footfacility which will be located on NorthConcepcion Street across from the Schoolof Medicine’s Medical Education Building.The building will include 12,000 squarefeet of simulation labs, four classrooms,and collaborative learning spaces.

Currently, the Hunt School of Nursingoperates out of a temporary location at415 East Yandell Drive in Downtown ElPaso. The Medical Center of the Americas(MCA) Foundation is helping to make thenew building a reality.

The School of Nursing accepted its firstclass of students in 2011 after a $10 mil-lion donation from the Hunt FamilyFoundation helped form the school in2010. Officials hope to have 300 nursingstudents at the school within five years.There are now 116 students and 13 facul-ty members at the school.

Construction helps to add to the MCAcampus which is also working on a newTech Park which will soon start construc-tion on a $28 million, 83,000 square footbiomedical research structure. Completionof the building is also expected in 2015.

The entire MCA campus encompasses440 acres of land in South Central ElPaso. Other anchors of the campusinclude University Medical Center, El PasoChildren’s Hospital, and the Paul L. FosterSchool of Medicine. The MCA’s MasterPlan envisions an integrated medicaltreatment, learning, and research campuswithin 50 years.

More information on the Gayle GreveHunt School of Nursing can be found atmcamericas.org and www.ttuhsc.edu.

Lanes on Sun Bowl Drive have been shifted as work has begun on the widening project.(www.onthemove.utep.edu)

Building Adds toSchool of MedicineCampus

Builders Outlook Issue 10.2013

Content provided byEl Paso Development News visit: elpasodevnews.com

Closer Look: 2014 Unified Transportation ProgramTXDOT’s Program Document Gives Snapshot of Future Projects

The Texas Department of Transportation(TXDOT) programmed hundreds of millionsof dollars earlier this year for El Paso’sBorder Highway West extension, a projectwhose total budget could reach $800 mil-lion. That’s according to the state’s latestUnified Transportation Program (UTP),approved by the Texas TransportationCommission in June.

TXDOT uses the UTP to authorize trans-portation projects for the state, but doesnot necessarily mean full present-day fund-ing is available for each individual project.Although the Border Highway West has acertain budget in the document, only $300million has been approved so far.

The nearly 1,200-page UTP includesabout 30 pages dedicated to developmentsin the El Paso District. Timeframes in thereport look forward about ten years fromthe present.

2014Projects listed for Fiscal Year 2014,

which began on September 1, 2013, arespread throughout the city and county. Thelargest listed in the document is construc-tion of FM 3880 from Alameda Avenue toInterstate 10 in southeastern El PasoCounty in Tornillo. The new $17.2 millionhighway will help take traffic to and fromthe expanded port of entry at the Mexicanborder, currently under construction.

About $11.5 million is programmed forreconstruction of streets in Downtown ElPaso. Another $5.5 million may be used tomake improvements to Pan American Driveand Winn Road near the Zaragoza Port ofEntry.

Smaller projects include purchases ofbuses for use in the County, construction ofsidewalks around town particularly alongMesa Street to compliment the Bus RapidTransit System (RTS) line, and a light-railstudy for the Paso Del Norte Port of Entry.

2015Fiscal Year 2015, which begins in

September of next year, has a longer list ofprojects than the previous year. By far, thelargest is the Border Highway West project

which could start construction next year. At$800 million, no other project is even closein budget or scale.

The $36 million Americas ManagedLanes project is scheduled for 2015 andwould create a tolled lane in each directionon Loop 375 from the Zaragoza Port ofEntry to Bob Hope Drive on the East Sideof El Paso.

Another $21 million may be used to con-struct two more direct connectors betweenI-10 and Loop 375 at the AmericasInterchange. These would be the final tworamps for the interchange; the fourth, fifth,and sixth connectors are currently underconstruction.

Also in the eastern portions of the area,$12.6 million could help widen EastlakeBoulevard from four to six lanes from I-10to Darrington Road. The state hopes theproject will ease congestion in one of thefastest growing neighborhoods in the area.

The City of El Paso’s RTS corridorscould get programmed funds, with around$9.2 million for the Dyer Street Corridorand $9.7 million for the Montana AvenueCorridor in 2015. And $9.2 million may beused for reconstruction of Alameda Avenuefrom Padres Drive to Loop 375.

The Lower Valley may see other proj-ects, such as a $5.6 million project toreplace the Carolina Drive bridge off ofAlameda Avenue and a $1 million Park-N-Ride project for the Zaragoza Port of Entry.

Smaller projects include texturizing ofshoulders on various highways, construc-tion of curb ramps, and rehabilitation ofsidewalks.

2016In Fiscal Year 2016, the largest project

listed in the UTP is a new $10 million four-lane street that will continue EastlakeBoulevard southward from I-10 and con-nect it to North Loop Drive. Another $2.48million may be used to install a continuousturn middle lane on Socorro Road of which$2.15 million has been programmed.

Delta Drive in South Central El Paso willhave a bridge replaced in a $1.8 million

project. And Doniphan Road may receiveraised medians from Mesa Street to theNew Mexico state line in a $1.13 millionproject.

In other general projects, $3 million maybe allotted for highway aesthetics improve-ments on I-10, while surface streets willsee traffic signal improvements, curb rampinstallations, and re-planking at railroadcrossings.

2017-2018 The UTP lists only smaller projects for

2017, then two large projects to begin in2018. The first project will add collector-dis-tributor lanes to I-10 from Executive CenterBoulevard to Mesa Street in West El Paso.According to the UTP, the project cost is$39.4 million, of which $24 million is pro-grammed for 2018.

A related project would construct aninterchange at Mesa Park Boulevard plusfrontage roads that would connect MesaPark to Executive Center Boulevard. Theproject may cost $55 million, of which $45million is programmed in the UTP.

Mesa Park Boulevard will connect com-muters to the Aldea El Paso SmartCodedevelopment which earlier this yearreceived approval from the Camino RealRegional Mobility Authority (CRRMA) tohelp fund construction of the interchangeand frontage road project. The 2018 time-line for the project in the UTP differs some-what from the deal Aldea’s developerstruck with TXDOT, which has the projectstarting in 2014.

Tentative Funding and Other ProjectsProjects for 2019 through 2023 are not

listed in the UTP, though there are associ-ated total dollar amounts for each year. Inall, the next ten fiscal years amount toabout $1.36 billion for the El Paso Districtin programmed funds.

As with any transportation plan, local-,regional-, or state-level projects may beadded or deleted from documents like theUTP. Plus local project lists are usuallylonger and more optimistic than thoseapproved at the state-level. The El Paso

Metropolitan Planning Organization’s(MPO) Transportation ImprovementProgram, for instance, lists scores moreprojects than the UTP.

State transportation funds have been acontentious issue in recent legislative ses-sions, though Texas voters may give newconstruction and maintenance projects a$1.2 billion shot in the arm next year.Lawmakers approved putting the proposalon the November 2014 ballot earlier thisyear. Funds would be diverted from oil andnatural gas tax revenue that would normal-ly go into the state’s reserve.

The Unified Transportation Program maybe viewed at TXDOT’s website,www.txdot.gov.

The University of Texas at El Paso(UTEP) began its 100-day CentennialCountdown last week with the unveilingof a large LED screen donated by GECU.The countdown clock will be displayed onthe screen, which is fashioned into aBhutanese style tower in front of theCentennial Museum.

The countdown began amid fanfare,music, dancing, and speeches at the for-mal unveiling where UTEP officials cele-brated the school’s past, present, andfuture.

“We’ve achieved much over the past99 years and we have even bigger aspi-rations for the future,” stated UTEPPresident Diana Natalicio, adding, “Wetake great pride in the achievements ofour alumni and share out students’dreams for a bright future.”

A new Centennial Welcome Center hasbeen added to the museum, the officialheadquarters for the CentennialCelebration. It will feature exhibits on theschool’s history, photographs showing thecampus throughout the years, and a chil-dren’s learning area.

A gift shop has also been added andwill feature limited edition CentennialWines in white and red varieties. Thewines come from the Miner Winery inNapa Valley, California. A CentenarioSalsa line will also be available and wascreated by Desert Pepper TradingCompany.

Other available Centennial collectiblesinclude t-shirts, ties, and a coaster setwith six different “mandala” designsinspired by medallions on campus build-ings. Visitors to the Welcome Center maypark in the Sun Bowl Parking Garage indesignated areas.

Opera BhutanUTEP officials plan a myriad of activi-

ties and announcements during the 100days leading up to the final countdownday on New Year’s Eve, December 31. ACentennial Blog has been created (trans-formations.utep.edu) which will includeinformation on events and activities dur-ing the celebration.

Up next for the school is homecomingweek, which started yesterday,September 29. And on October 12, UTEPsingers and musicians will perform anopera in the Kingdom of Bhutan. OperaBhutan, as it is called, is a production ofHandel’s Acis and Galatea which willincorporate Bhutanese dance and culturalelements.

It will be the first opera to ever be per-formed in the tiny Himalayan country.Thirty-three UTEP students, faculty, andstaff are already in the Kingdom ofBhutan for a three-week visit which willinclude the performance.

The history of UTEP and Bhutan’s rela-tionship goes back nearly 100 yearswhen the school used Bhutanese-influ-enced design in its first building. In 2008,Prince Jigyel Ugyen Wangchuck of theKingdom of Bhutan was a guest at UTEPduring Bhutan Days at the campus.

Campus TransformationConstruction on UTEP’s Campus

Transformation project is also ongoing,and the school has installed cameras atdifferent locations around the futureCentennial Plaza site which show a livefeed of crews at work.

The large plaza area is part of UTEP’splan to move automobile traffic out of thecenter of campus. Several Transformationprojects will eventually create largepedestrian-friendly environments in andaround the center of the school.

Centennial Plaza should be completein August 2014, in time to host the west-ern debut of Opera Bhutan. Informationon UTEP’s Centennial Celebration can befound online at centennial.utep.edu.

Funding for the final twoAmericas Interchange rampshas been programmed intothe UTP. (CRRMA)

Limited edition UTEPCentennial wines are avail-able now, created by MinerWinery of Napa Valley.

UTEP Update:CentennialCountdown Begins


This Just In…The Affordable Care Act prohibits group

health plans or group health insurers from

imposing any waiting period that exceeds 90

days. (Neither plans nor insurers must

impose any waiting period.) In March, the

Internal Revenue Service, the Employee

Benefits Security Administration, and the

Health and Human Services Department

proposed regulations that would clarify how

waiting periods would apply to employees

with variable hours.

A group health plan that conditions

eligibility on an employee regularly working

a specified number of hours per period (or

working full-time) would be able to take “a

reasonable period of time” to determine

whether a variable-hour employee meets

this condition. This “measurement period”

can last no more than 12 months, beginning

on any date between the employee’s start

date and the first day of the first calendar

month following the employee’s start date.

The measurement period will not be

considered out of compliance with the 90-

day waiting period limitation if coverage is

made effective no later than 13 months from

the employee’s start date, plus the time

remaining until the first day of the next

calendar month. Plans cannot impose a

waiting period in addition to the

measurement period. For more information

on implementing the Affordable Care Act in

your workplace, please contact us.

Health Insurance

ACA Spurring Interest in Self-Insurance

Between 2000 and 2010, the percentage

of people with employer-based health plans

enrolled in self-insured plans increased

nearly 10 percent, according to the U.S.

Agency for Healthcare Research and

Quality. The Affordable Care Act (ACA)

creates new incentives for smaller employer

groups to consider self-insuring.

What Is Self-Insurance?

Employers providing health benefits to

employees have three basic choices: buying

a fully insured plan, self-insuring or offering

employees a choice of fully insured and self-

insured plans. With an insured plan, the

employer pays a flat per-enrollee premium

to an insurer that administers the plan and

pays claims. Like an insured employer, a

self-insured employer has a written plan.

However, it pays for its workers’ claims

directly as incurred and retains the risk of

higher-than-expected claims.

So Why Do Employers Self-Insure?

State laws that regulate fully insured

group plans usually do not apply to self-

insured plans. And some provisions of the

federal Patient Protection and Affordable

Care Act of 2010 pertain to fully insured

plans but not to self-insured plans.

Self-insurance offers a variety ofpotential advantages to employers,including:

• Autonomy, control and flexibility of plan

design, including exemption from state-

mandated benefit requirements;

• Lower administrative costs than a

commercial carrier would charge;

• More timely and complete access to data

on health claims, which can help

employers make more informed decisions

about plan design;

• Ease of altering their contract with a third-

party administrator (TPA) or stop-loss

insurer without affecting employees’

choice of providers;

• Improved cash flow generated by keeping

funds in-house until needed for payment of

claims; and

• Avoidance of state insurance premium

taxes.

Once the Affordable Care Act is fully

implemented, several provisions will affect

fully insured small group plans (100 or fewer

employees) that will not affect self-insured

plans:

• Community rating will apply. Insurers will

be allowed to vary premiums only according

to actuarial value of the plan, geographic

region, age, tobacco use and family size.

Your group’s health status or actual claims

experience will not matter.

• Risk adjustment will begin. The ACA allows

the transfer of funds from plans with

enrollees having lower than average costs

to plans with employees having higher

than average costs.

• Plans offered to small groups must cover

“essential health benefits” (EHBs). The

EHBs include items and services within

ten general categories, including

prescription drug coverage and mental

health and substance-use-disorder

services.

The EHBs will likely drive prices up for

many small group plans. And with

community rating and risk adjustment,

healthier groups will essentially subsidize

the cost of covering less-healthy groups.

Therefore, if you have a relatively young,

healthy group, you may save money by self-

insuring.

Self-insurance has potentialdisadvantages, however. These include:

• Financial risk of unexpectedly large

claims;

• Regulatory compliance, which is easier

with a fully insured plan;

• Loss of some discounts. Insurers and

larger employers have the clout to

negotiate discounts with health providers

that smaller employers lack.

Although some self-insured employers

administer their plan, most outsource plan

administration and claim processing to a

third-party administrator. They can also

mitigate some of their risk by purchasing

stop-loss insurance, which will reimburse a

covered employer for claims above a

specified dollar level.

Note that a stop-loss policy is a contract

between the carrier and the employer, not a

health policy covering individual plan

participants. This means the pre-existing

condition and guaranteed renewability

requirements that apply to health insurers

do not apply to stop-loss insurers. Stop-loss

insurers can refuse coverage or drop

coverage if a group experiences too many

claims.

However, the ACA will make changes that

will allow self-insured employers to switch

back to a fully insured plan at a later date

without having to worry about an insurer

refusing to cover the group or specific

individuals. When fully implemented, the

ACA will not allow health insurers to:

• Refuse to write small group plans based

on health status.

• Exclude specific individuals from a small

group based on health status. Insurers

must “take all comers,” regardless of

health status.

• Charge higher premiums based on the

health status of your group or the gender

of your employees. It will also limit how

much premiums can vary based on age.

In our next issue, we’ll discuss some self-

insured plan structures and stop-loss

insurance. To discuss self-insurance options

in more detail in the meantime, please

contact our office.

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Expert Advice

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of El Paso


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Builders utlook on the scene |

The Professional Women’s Council held a special member-guest

lunch and learn with guest speaker Michelle Cromer. Ms. Cromer’s

topic was Feng-Shui, the art of balance in life and in your surroundings.

Ms. Cromer was brought to us by Margaret Livingston and introduced by

PWC chairwoman Lorraine Huit. This was the largest number of

attendees at this councils meeting this year.

Women’s Council

Membership News

Thanks to our OCTOBERSODA SPONSOR:Palo Verde Homes

To Ted Escobedo on the loss of

his mother Eloise Escobedo

11395 James Watt, Suite A-11 79936915-633-8002

132013 Issue 10 Builders Outlook

www.elpasobuilders.com www.epbuilders.org

UPCOMING EVENTS |

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CONDOLENCES |

Probably by the time you receive this,

our Bowling Outing will be done and over. I

am sure that everyone that participated will

have had a great time. We still have some

sponsorship available for our El Paso

Desert Open Sun Country Pro Am at 9:00

am November 13th. This is a great

opportunity to advertise as this event is a

sellout. Please call Margret for details.

As the year is passing by rapidly and the

end is near I just want to say thank to all the

Associates that participated in our events

this year as it has made a big difference. I

would also would like to thank the board for

all the support and a Big Special Thanks to

Frank Torres who without a doubt is the

Guru of all Parade of homes.

Once again a big Thanks to everyone

that has made this a special year with two

events to go.


Sam ShallenbergerWestern Wholesale Supply

Associates Council

Located in the heart of Downtown El Paso.

415 North Mesa 225-8200 stewart.com/el-paso

Cindy Bilbe, President

Congratulations, Cindy on your induction into the El Paso Business Hall of Fame!

Expert Advice

David De RegoHardware Specialities &

Glass Co., Inc.

For bathrooms, the trend in color is more.

"It used to be that there wasn't a lot of color

in the bathroom, so more color is definitely

a newer trend. Neutral shades such as

cream, beige and taupe have long been

popular color choices for the bathroom

because they wear well and fit easily into

any design scheme. But these safe colors

are giving way to bolder palettes that create

a cheerful, fun place to wake up to every

morning. While bold can be beautiful, it's

not necessarily for everyone. Color

forecasting is about reinventing the ways

you put colors together so you get a fresh,

clean feeling, without abandoning the hues

that fit your personal taste.

A Touch of ColorIf you don't want color everywhere in

your bath, try adding small doses in

cheerful colors such as sunny yellow or

fire-engine red that are inspired by

children's bathrooms. Plastic or enamel

faucets or fanciful geometrically shaped

light fixtures are two bold solutions that can

give your bathroom a unique look.

Those who like to change color

frequently, for example with the seasons,

should consider rotating accessories. You

can easily add a touch of updated color —

an unexpected 'aha' — with towels, rugs

and other accessories. Try cool spa colors

such as sapphire blue and seafoam green

for spring, and brighter beach colors such

as flamingo pink and chartreuse for

summer. With the fall comes warmer

shades of brown, while winter-influenced

colors include candy apple red and maroon

with an undertone of pink.

Timeless ColorsWhile we're going to see more and more

color in the bathroom, certain timeless

guidelines still apply. Most skin tones are

pink or of a lighter shade tan, so if you want

warm tones that will pick up that color use

peach, rose and light mocha colors to

enhance the subtle feel.

Don't rule out those cool spa colors the

soothing blues, blue-greens, greens and

blue lavenders that enable tranquility and

relaxation. Ultimately, your choice of colors

boils down to your expectations of what you

want in a room that suits your comfort level

and décor. What’s Trendingin bathrooms

� execuTive oFFicerS

edmundo Dena – President

Accent Homes

Frank Torres – vice President

GMF Custom Homes

edgar montiel – Secretary/Treasurer

Palo Verde Homes

Sam Shallenberger – Associates chair

Western Wholesale

Frank Arroyos- immediate Past President

Cisco Homes

ray Adauto – executive vice President

El Paso Association of Builders

� couNciL/commiTTee cHAirS

Associates council

Sam Shallenberger

Build PAc

Randy Bowling

Desert Green Building council

Javier Ruiz

Land use council

Sal Masoud

Young Designer Award

John Chaney

remodelers council

Rudy Guel

membership retention

Mike Santamaria, Greg Bowling

Finance committee

Edgar Montiel

Women’s council

Lorraine Huit

� ADviSorY To THe BoArD

J. Crawford Kerr, Attorney, Firth, Johnston

& Martinez

� BoArD oF DirecTorS

Juanita Garcia, Icon Custom Builders

Samira Gonzalez, Edwards Homes

Walter Lujan, Dawco Construction

Carlos Villalobos, Pointe Homes

Don Rassette, Rassette Homes

Beverly Clevenger, Automated Division 6 Builders

Frank Spencer, Aztec Contractors

Kathy Parry, Hunt Communities

Sal Masoud, Del Rio Engineering

Robert L. Foster,

Southwest Land Development Services

Leti Navarette, Custom Dream Homes

Linda Troncoso, TR-Engineering

Lance VanDeman, Hub International

John Chaney, Passage Supply

Joe Bernal, El Paso Employee Benefits

Ken Wade, El Paso Building Materials

Ruben Orquiz, MTI Ready Mix

Kathy Carrillo, Pioneer Bank

Henry Tinajero, West Star Bank

Paul Zacour, Zacour & Associates

Chuck Gabriel, Carpets West

Ted Escobedo, Snappy Publishing

Lorraine Huit, Cardel Design

Javier Ruiz, Border Solar & Senercon

2012 Builder member of The Year

Frank Arroyos

Cisco Homes

2012 Pat cox Award

Mike Santamaria

Mountain Vista Homes

2012 Associate of The Year

Sam Shallenberger

Western Wholesale Supply

John Schatzman Award

Hunt Companies

Honorary Life members

Rudy Guel

Brad Roe

Cliff Anthes

Wayne Grinnell

Chester Lovelady

Don Henderson

Anna Gil

Past Presidents

committed to Serve

ePAB mission Statement:

The El Paso Association of Builders is a

federated professional organization representing

the home building industry, committed to

enhancing the quality of life in our community by

providing affordable homes of excellence and

value.

The El Paso Association of Builders is a

501C(6) trade organization.

© 2013 Builder’s Outlook

is published and distributed for the

El Paso Association of Builders

by Snappy Publishing

240 Thunderbird • Suite C

El Paso • Texas • 79912 915-820-2800

6046 Surety Dr. El Paso, TX 79905

915-778-5387 • Fax: 915-772-3038

Greg Bowling

Kelly Sorenson

Mark Dyer

Mike Santamaria

John Cullers

Randy Bowling

Doug Schwartz

Robert Baeza

Bobby Bowling, IV

Rudy Guel

Anna Gil

Bradley Roe

Bob Bowling, III

E. H. Baeza

Hershel Stringfield

� TAB STATe DirecTorS

Doug Borrett, Karam Co., Life Director

Randy Bowling, Tropicana Homes

� NATioNAL DirecTorS

Bobby Bowling IV.

Demetrio Jimenez

NATioNAL ASSociATioN oF

Home BuiLDerS

(800) 368-5242

TexAS ASSociATioN oF

BuiLDerS

(800)252-3625

www.elpasobuilders.com www.epbuilders.org

Builders utlook

buildersoutlookissue10 2013

Documents

past year

percent of builder

percent nextyear

housing hasbeen

solid outlook nahb

housing reboundwas

wesee additional inventory

lot supplies