Written by Forrest Wall, CAE, Staff Vice President and Industry Relations
Constitutionality of Nonrecourse Mortgage Loan Act Under Attack
AAM has joined the Building Owners & Managers Association (BOMA) in the filing of an amicus brief supporting the constitutionality of Michigan’s Nonrecourse Mortgage Loan Act. This law, enacted last year, corrected problems with the interpretation of nonrecourse loan carveouts by prohibiting a post-closing solvency covenant from being used as a nonrecourse carveout or as a basis for any claim against a borrower, guarantor, or other surety on a nonrecourse loan, and, by specifying that a noncompliant provision in loan documents would be invalid. The legislation applied to the enforcement and interpretation of all nonrecourse loan documents in existence at the time or entered into in the future. The legislation was needed in response to two court cases in Michigan which essentially provided for personal liability within nonrecourse loans in the event of foreclosure. The Michigan Supreme Court recently remanded one of those cases back to the Michigan Court of Appeals to reconsider its previous decision that insolvency triggered full recourse liability given the passage of the Nonrecourse Mortgage Loan Act. The plaintiff has challenged the constitutionality of the legislature applying the law retroactively. AAM will keep you updated on this important issue.
Carried Interest Tax Increase Back In Play
In his push for more tax revenue to reduce the deficit, President Obama recently put the carried interest tax squarely in the crosshairs. In a recent interview with CBS, Obama stated that the United States could reduce the deficit with a combination of spending cuts and by closing tax loopholes. The President specifically cited “carried interest” as an example of a loophole. For the last several years, the President, as well as many Congressional Democrats, have characterized the current treatment of carried interest as an unfair loophole, and proposed that it be taxed as ordinary income. Originally, the rationale used by advocates for the change was that it was a means to tax Wall Street hedge funds, but as we know it would also affect real estate partnerships. AAM will continue to work with NAHB and other real estate groups to oppose an increased tax on carried interest.
Are Your Company Trucks In Compliance?
If you operate a truck in your business, there is a good chance all or some of the state and federal trucking regulations apply to you. Recently enacted legislation in Michigan – Public Act 231 of 2012 – has amended the Michigan Motor Carrier Safety Act to exempt certain vehicles, but also provide that these vehicles remain subject to federal regulation. On April 23, HBA and AAM will host a free seminar covering this issue, including requirements for USDOT numbers, proper licensing, and much more. You can register for the program at www.builders.org.