By Steven Feldman
HICKSVILLE, N.Y.—A coalition representing the home furnishings and residential building products industries is pushing for legislation that would provide tax incentives for consumers and businesses for the purchase of home furnishings and building products. The Home Improvements Revitalize the Economy (HIRE) Act of 2009 already has a sponsor in Congressman Hank Johnson (DGa.) but more support is needed to help get it through the House and then the Senate.

“The HIRE Act is a temporary, timely and targeted effort to put money in the hands of consumers and help them improve the value of their homes by incentivizing the purchase of home furnishings,” said Dean Thompson, president of the Resilient Floor Covering Institute (RFCI)—one of four participating floor covering organizations, the others being the Carpet & Rug Institute (CRI), World Floor Covering Association ( WFCA) and National Wood Flooring Association ( NWFA). “These purchases will also help to stimulate the manufacturers, distributors and retailers of these products.”

Most important, Thompson said, is the need for more legislators to support this bill. To that end, the coalition is requesting that manufacturers, distributors and retailers contact their local representatives in Washington, either by mail or phone. The bill will be introduced as soon as there are enough co-sponsors on it, he added.

“This is a big deal for the entire industry,” Thompson said. “The time to act is now. We need to give [Congressman Johnson] incentive to move forward with the bill and introduce it before the end of summer. If he has enough co-sponsors going in, it will have a broader impact on Congress to think real hard about passing it. There is a direct correlation between the number of cosponsors and perceived importance of a bill. ”

Manufacturers are an important piece in the process, Thompson said, because they have a large voting constituency. “Tell your representative who you are; communicate to them your size and scope. That can make a difference.”

One thing the bill has going for it, Thompson said, is that it coincides with President Obama’s stimulus plan to offer tax deductions and credits to middle-and lower-income families.

And Chris Davis, CEO of the WFCA, added, “This is not a handout bill, where direct cash goes to banks and insurance companies. It is a stimulus package that is designed to improve and enhance the value of consumers’ homes and get some spending out in the marketplace, which will generate American jobs, additional sales and, thus, additional taxes.”

Specifically, the legislation would provide:

• A tax deduction of up to $2,000 per family ($1,000 per individual) for the purchase and/or installation of qualifying home furnishings or building products for families making up to $300,000 a year ($150,000 for individuals);

• A tax credit of up to $500 per family ($250 per individual) for the purchase and/or installation of qualifying home furnishings materials or building products for low- income families and individuals, and

• A tax credit of up to $10,000 for contractors and retailers for the purchase of qualifying home furnishings or building products for resale.

The legislation would also provide a $2,000 individual credit and $4,000 joint credit to consumers for the purchase of covered products meeting LEED, Green Globes, FloorScore or other recognized environmental standards.

“This is not just a spending bill,” Thompson said. “We are not asking the administration to spend money. This is a bill where the consumers are going to spend money and receive tax incentives for doing that.”

During the current economic downturn, home repairs and upgrades have been dramatically curtailed. The home furnishings and building products industries have experienced a steep decline in sales and job losses. The numbers are staggering. These two industries combined are expected to lose $141 billion in economic value from 2007 to 2009, not no mention nearly 575,000 jobs.

“One of the things we have discovered,” Davis said, “is we are all in the same boat, whether you make kitchen cabinets, mattresses or flooring. We all make discretionary products.” And part of the reason these industries are in decline is the credit crunch. “One of the things we are finding is the people who want to buy can’t get credit. Many of our dealers are telling us they are not getting the approvals like they used to on 12 months same as cash. GE Money, for example, is approving only a fraction of the people it once did. We talked to our partners in our coalition, and they all have this same problem. So, this is a credit we are asking for. People spend the money, stimulate the economy, help bring back equity in the homes. It would be a great victory for our industry.”

But Michael Raskin, president of RFCI member Metroflor, noted that getting this bill passed is just the first step. “The tax incentives are a great start, but the floor covering retailers have to do their part as well to drive the consumers into their stores so they spend their money and get their credits on flooring and not other home furnishings and building products.”

For more information, contact the RFCI at 706.882.3833, CRI at 706.428.2116, WFCA at 800.624.6880 or NWFA at 636.519.9663.