Internal Rift at NAHB Shows Muscle of Major Firms

Washington, DC, March 16, 2009--An internal fight at the National Association of Home Builders is reaching the boiling point, and the outcome could refocus the industry's lobbying efforts at a critical time for the housing market, according to the Wall Street Journal.

The newspaper reported that disputes between large and small builders have escalated in recent weeks over NAHB's position on a lucrative tax break sought by the large homebuilders.

Jerry Howard, the NAHB's longtime chief executive, and some small builders have raised concerns that the big builders would abuse the break.

Executives from some of the trade group's largest home-building companies are scheduled to meet Monday in Chicago with the NAHB leadership to discuss the possibility of ousting Howard, WSJ reported.

Representatives from major homebuilders KB Home, Centex Corp. and Pulte Homes Inc. may call for Howard's ouster or threaten to break away from the 200,000-member trade group.

Either move by the big builders would signal the growing political clout of the publicly traded home builders, which are gaining greater control of the new-home market as smaller builders struggle to survive the downturn.

The tax break involves net operating losses. The big builders have been lobbying for more than a year to allow companies to apply current losses against profits made five years ago, instead of the current two-year carry-back. Small builders would also benefit from expanding the carry-back to five years.