Survey Shows Contractors’ Marketing Gaps
Experts offer tips for meeting residential HVAC customers where they’re most likely to look

A survey of HVAC contractors and homeowners found significant gaps between the places that contractors tend to focus marketing efforts and the ways consumers are most likely to search for HVAC service providers.

The survey found, for example, that while 47% of contractors advertise via local print media such as newspapers, magazines, and mailers, only 22% of homeowners search for a contractor using print media. And while 29% of homeowners reported looking to home-improvement retailers to find a contractor, only 13% of contractors market through those retailers, the survey found.

The survey was conducted in March by Clear Seas Research, the research unit of BNP Media, parent company of The ACHR NEWS. It also included questions on pricing, HVAC equipment, the importance of online reviews, the factors that go into HVAC purchasing decisions, and other issues surrounding contractor-customer relationships.

Three HVAC marketing experts who looked at the survey’s findings on the marketing gaps offered contractors tips on changing up their strategies to better match how consumers are seeking HVAC services, while also customizing those strategies to fit their business plans and account for the differences between markets.

Wherever homeowners choose to look is where contractors, marketing-wise, need to be, said Crystal Williams, founder of Lemon Seed Marketing.

“This is not a one-trick pony,” Williams said. “You’ve got to have a full gamut of strategies deployed.”

“There is no silver bullet” in HVAC marketing, said Colleen Keyworth, director of sales and marketing at Online Access Inc. It takes “blood, sweat, and tears” in Keyworth’s words: an understanding of the target audience, a multi-faceted approach, and lots of local engagement.

“It takes work when you’re smaller,” Keyworth said. “There’s not a lot of stuff that you can just pull a lever on.”

Broadly speaking, the survey found that consumers turn to the internet to look for HVAC contractors at a greater levels than contractors market themselves there. Some 71% of homeowners reported using word-of-mouth recommendations, including from social media, to find contractors, but only 53% of contractors employ social media, according to the survey. (Some 43% of contractors reported marketing via non-social-media word-of-mouth.)

Marketing professionals recognize that contractors are short on time, and that social media adds another chore to lengthy to-do lists.

“If they’ve got to choose between posting to social media and trying to find parts and equipment during rush times, they can’t choose social media,” Williams said.

“Contractors get very much distracted by all the other stuff they have to do,” said Keyworth.

Williams recommended that contractors new to social media pick one platform, post consistently ― three or four times a week ― and get good at it before expanding their reach.

“Just start gradually, slowly but surely getting yourself into the groove of it,” she said. Consider delegating social media to a customer service representative, a dispatcher or even a technician for a bit of extra pay, she said. “There’re ways to get it done,” Williams said. “It’s just going to take some intentionality and some scheduling.”

Additionally, the survey found that 29% of homeowners use home services websites, such as Angie or Home Advisor, while only 23% of contractors advertise on such websites. And only 32% of contractors said they use Google Ads for marketing.

The survey’s findings on that internet disconnect weren’t surprising to Paul Redman, vice president of sales at Contractor Commerce. But employing the internet for marketing, and even paying for it, is now “non-negotiable,” Redman added.

“Contractors must have a 365-day approach to improving, managing, and executing SEO (search engine optimization) and paid search,” said Redman. “In a perfect world, you organically appear to your ideal customer with enough frequency that ads are not too necessary, but we do not live in a perfect world.”

Williams said contractors’ bias toward their own tastes may account for part of the marketing gap when it comes to using social media.

“We tend to use things that look good to us, even when we’re not in the target market, you know, so we tend to market to our own selves,” she said. “And that’s not always what we need to be doing.”

Here are some other tips for residential HVAC contractors who are looking to tweak their marketing efforts to better meet their target audiences:

• Use social media personably by, for example, posting a photo of your team, wishing an employee a happy birthday, and acknowledging the employee of the month.
  “Those tools are designed to build a relationship with people in your target market,” Williams said. “People do business with people that they like and know.”
  Social media posts, Redman said, need to connect with people in an authentic way instead of a transactional one.
  “You have to find a way for your brand to bring value to a community (online) and be OK with never getting a single lead,” he said. “The intent has to be to build a brand and play the long game.”
• When it comes to paid internet advertising, Williams said, “test and modify, test and modify, very, very consistently.”
• Consider — carefully — marketing through home-improvement retailers, which often have “preferred contractor” lists that they share with customers. While that works for some contractors and can provide consistent leads, it also inserts a middleman into the process, can deprive a contractor of the opportunity to sell the equipment as well as the installation, and can get in the way of developing direct, long-term relationships with homeowners, said Keyworth.
• Don’t overlook community engagement. Local charities, social groups, and clubs like the Rotary can open a lot of doors to word-of-mouth referrals, Keyworth said.
• Keep it local with print. Although print newspapers are not as prevalent as they once were, Williams said, print ads can still work in niche publications, such as homeowners association newsletters, church bulletins, and community magazines.

“Go into the areas of your cities that you really want to own, and see if they have a country club newsletter, an HOA newsletter,” she said. “That’s where I would move my print media.”

https://www.achrnews.com/articles/153359-survey-shows-contractors-marketing-gaps

The U.S. Department of Labor (DOL) recently announced the issuance of the final rule, Updating the Davis-Bacon and Related Acts (DBRA), which it says will “better reflect the needs of construction workers on federal construction investments.” The DBRA have not been significantly updated in more than 40 years.

The Davis-Bacon Act is a United States federal law that was enacted in 1931 and requires contractors and subcontractors on federal government construction projects to pay their laborers and mechanics the prevailing wages and fringe benefits in the local area. The Act applies to each federal government or District of Columbia contract in excess of $2,000 for the construction, alteration, or repair (including painting and decorating) of public buildings or public works.

The updated regulation follows a Notice of Proposed Rulemaking on March 18, 2022, which received comments from construction industry and labor stakeholders that helped inform the regulatory updates.

"Modernizing the Davis-Bacon and Related Acts is key to making sure that the jobs being created under the Biden-Harris administration's Investing in America agenda are good jobs, and that workers get the fair wages and benefits they deserve on federally funded constructions projects across the nation," said Julie Su, acting secretary of Labor. "This updated rule will create pathways to the middle class for more families and help level the playing field for high-road employers because companies who exploit their workers, or who don't pay workers fairly, should never have a competitive advantage."

According to DOL, the final rule's& regulatory changes improve the department's ability to administer and enforce DBRA labor standards more effectively and efficiently. These changes include the following:

• Creating new efficiencies in the prevailing wage update system and making sure prevailing wage rates keep up with actual wages which, over time, would mean higher wages for workers;
• Returning to the definition of "prevailing wage" used from 1935 to 1983 to ensure prevailing wages reflect actual wages paid to workers in the local community;
• Periodically updating prevailing wage rates to address out-of-date wage determinations;
• Providing broader authority to adopt state or local wage determinations when certain criteria are met;
• Issuing supplemental rates for key job classifications when no survey data exists;
• Updating the regulatory language to better reflect modern construction practices; and
• Strengthening worker protections and enforcement, including debarment and anti-retaliation provisions.

The DBRA requirements apply to an estimated tens of billions of dollars in federal and federally assisted construction spending each year and provide minimum wage rates for hundreds of thousands of U.S. construction workers. DOL expects a significant increase in the numbers of industry workers due to the historic investments in federally funded construction projects made possible by legislation such as the Infrastructure Investment and Jobs Act.

Industry Reaction

The Sheet Metal and Air Conditioning Contractors' National Association (SMACNA) applauded the DBRA reforms, noting that SMACNA contractors and chapter executives “have long been strong and outspoken advocates for Davis-Bacon regulatory reforms, especially greater enforcement to combat Davis-Bacon contracting violations widely seen as unfair to honest federal bidders competing for infrastructure projects.”

In a written statement, SMACNA noted that, “DOL’s final rule will make the wage determination and verification process far more responsive by giving Department of Labor’s Wage and Hour Administrator the express authority to adopt prevailing wages determined by state and local governments, issue wage determinations for labor classifications where insufficient data was received through the wage survey process and update outdated wage rates. SMACNA most enthusiastically endorses the Department’s return to the 30% rule after decades of harm to the Act. After more than 40 years, restoring the 30% rule for prevailing wages ensures our members are compensated in a way that is consistent with local collectively bargained rates and the real rates paid to the most skilled and qualified apprentices and journey workers in such short supply today, and so badly needed for the complex Federal projects of the future.”

Associated Builders and Contractors (ABC) criticized the update, with Ben Brubeck, vice president of regulatory, labor, and state affairs at ABC, noting that DOL’s final rule “disregards the feedback of ABC contractors, construction industry stakeholders, and thousands of small businesses urging the withdrawal of this unnecessary, costly, and burdensome regulation. Instead, the DOL is moving forward with dramatic changes to prevailing wage regulations, reversing much-needed reforms that were established nearly 40 years ago, and unlawfully increasing the regulatory burden on small businesses, new industries, and public works projects.”

Brubeck added, “With this final rule, the DOL has abandoned any possibility of instituting commonsense reforms to Davis-Bacon regulations to ensure accurate and prompt prevailing wage determinations while providing the regulated community with the clarity needed to deliver high-quality projects at an affordable cost to taxpayers. Instead, the rule makes it much more likely that the DOL will adopt union wage scales at the prevailing wage at a greater frequency than in current practice, which already adopts union wage scales at improbable rates considering just 11.7% of the construction industry is unionized. ABC will now be forced to take appropriate legal action to address the numerous illegal provisions of the final rule and protect our members, and ultimately hard-working taxpayers, from the harmful impacts of this regulation.”

The Associated General Contractors (AGC) of America’s chief executive officer, Stephen E. Sandherr, was also critical, noting that, “a preliminary analysis shows that while more work will be covered, this rulemaking critically missed an opportunity to improve the wage determination process. The 40-year awaited update reverts to the pre-1983 methodology for determining whether a wage rate is prevailing, also referred to as the “30% rule.” Just as proposed, this final rule appears to make it easier on the DOL itself to set prevailing wages with less of the data it already collects, or lack thereof.

“AGC holds that the DOL’s almost exclusive reliance on voluntary surveys to produce and update wage determinations has created a compensation system for Davis-Bacon covered construction that poorly reflects the construction labor market in many parts of the country,” added Sandherr. “AGC recommended the DOL should instead focus on how to collect more accurate data, instead of being able to rely on less, or even at times inappropriate data, to determine wages that are truly prevailing.”

The final rule will become effective on October 23, 2023. DOL will host two online webinars on September 13 and 14 to provide an overview of the changes to the Davis-Bacon and Related Act Regulations.

August 31, 2023 - Article courtesy of ACHR News

Additional Information:

Final Rule: Updating the Davis-Bacon and Related Acts Regulations | U.S. Department of Labor (dol.gov)

www.federalregister.gov/documents/2023/08/23/2023-17221/updating-the-davis-bacon-and-related-acts-regulations

It is easy while watching the news or talking with neighbors to focus in on the headwinds that are affecting both the U.S. economy and the HVAC market. In fact, it is hard to avoid them.

While inflation is slowing down a bit, it is still at historic highs. Rising costs everywhere means the consumer has less disposable dollars in their pockets. Interest rates being so high means financing has gotten more expensive for homeowners. Every HVAC contractor knows what those factors mean — repair instead of replace.

And, of course, this is all going into an election year, where uncertainly will reign as our friends in Washington, D.C. will somehow find a way to be even less productive. And as well all know … businesses hate uncertainty.

But that does not necessarily mean all is lost for the HVAC contractor. There are plenty of signs to show that, in fact, there are good days ahead when talking about the heating and cooling industry.

Here are five reasons to be positive about the HVAC industry:

1. Private Equity: Private equity money has been flowing into the HVAC industry for the last few years now. It has been great for a lot of contractors who certainly got rewarded for working hard and building great businesses.
   The private equity folks are not in the business of losing money. They invest a lot of time, effort, and capital to make sure they get a solid return on their investment. Sure, they see a mostly fragmented business on the contractor and distributor side that they find advantageous to merge together. But they also know the growing importance of air conditioning in our society as a need instead of a want.
   It is never a bad place to be on the side of private equity. It is like being on the same side of the Super Bowl with the major casinos. I like our chances.
2. Perspective: Like with anything in life, how the HVAC industry is doing comes down to how you are viewing it. While the numbers might be decreasing from the last three record years, the amount of product being purchased is still quite strong.
   If you had offered these numbers to the industry at the end of 2019, everyone would have certainly signed up for it. So in looking at this with a glass-half-full perspective, the industry is much better off than it was five years ago.
3. Recent History: Since the Great Recession of 2008, the HVAC industry has been incredibly resilient. In the last 15 years, there have certainly been more than a few macro factors that made the leaders in the industry nervous about its immediate future. Tariffs, COVID, and supply chain issues have all been dealt with by the industry without missing a beat. Odds are that the industry can also handle inflation and a downturn in the economy.
4. Inflation Reduction Act: This legislation from the federal government means HVAC equipment — specifically, heat pumps, which can see a tax credit of up to $2,000 — is going to be much more affordable for homeowners.
   The U.S. government is trying to incentivize electrification, and this is something HVAC contractors should be taking advantage of this year. The federal government is also promoting the development of cold climate heat pumps, so this is for contractors in the north also.
5. Indoor Air Quality: In addition to normal heating and cooling, there is a great need for IAQ, and the HVAC industry can deliver. One needs to look no further than the recent Canadian wildfires to realize this is a problem that needs to be addressed.

And it is not just a short-term issue based on what is happening in Canada. This got on the public’s radar during the COVID crisis, and it is not going away any time soon. Homeowners want to be sure the air that they breathe is not putting their family’s health at risk.

So will HVAC shipment numbers be on par with the last three years that saw record highs? Probably not. But it is looking like the HVAC industry will continue to be robust, and owners will be in a great position to make a lot of money.

Source: 5 Reasons to be Positive About the HVAC Industry | ACHR News

A pending regulation by the Federal Acquisition Regulatory Council would require firms that receive more than $7.5 million in contracts annually to disclose greenhouse gas emissions from their business and supply chain – putting a bullseye on the back of the steel industry, which worldwide accounts for 8% of annual greenhouse gas emissions.

Contractors above $50 million also will need to disclose emissions from subcontractors and suppliers, conduct a climate risk assessment and set non-binding greenhouse gas reduction targets. In a Feb. letter, U.S. Senator Joni Ernst (R-IA) wrote extensively about her opposition to the regulation, noting tracking supplier emissions is going to impact even the smallest of contractors.

“If a small business owner determines there is no business case for staying in or entering the federal marketplace due to the high regulatory burden, they will leave the federal marketplace altogether, leaving fewer vendors capable and willing to meet government's needs,” she wrote.

But Randy Charles, metallurgist and founder of Greenway Steel, says this pending regulation isn’t the only front contractors are facing in the decarbonization battle – and not all of them only impact federal contractors.

2023 building decarbonization legislation recap

Decarbonization legislation passed across 20% of U.S. states this year, according to the National Caucus of Environmental Legislators.

In Feb. 2022, the Securities and Exchange Commission proposed a draft rule to enlist companies in calculating and disclosing their climate-related costs. In May, the Biden administration made low embodied carbon procurements a priority in agency purchases and implemented emissions reduction targets. Then at the state level, states like California have cap and trade. New York and Vermont also passed strong building decarbonization legislation this year, according to an analysis by the National Caucus of Environmental Legislators.

“Utility providers and suppliers of purchased goods also may have targets already established. Many large public companies have been communicating their targets through sustainability reporting. Targets are being established for 2030 and 2050, but a lot can happen between now and then,” Charles said.

Sweden aims for commercial scale green steel by 2026

Speaking at the summer Metal Construction Association's 40th annual meeting, Charles said the U.S. seems to be a couple years behind the EU on regulatory developments and initiatives, particularly hydrogen. However, the US is globally leading in terms of low greenhouse gas emissions related to steel production. 

Sweden and the EU have been more motivated on the transition to hydrogen owing to the continent’s reliance on older blast furnace technology as opposed to electrical options. The U.S. fleet of electric arc furnaces, which now account for 70% of domestic steel production, are powered by electricity. And this is a step up from the blast furnaces that still dominate Europe’s steel industry with a 75% higher carbon intensity. Sweden also has abundant high-flowing water to supply power for producing green hydrogen that the country can develop economically, Charles said.

He noted Sweden has supported a green transition for its steel sector with its state-supported enterprises, replacing the carbon intensive coking coal input with fossil-free hydrogen power at SSAB Oxelösund. Full commercial production will begin in 2026, with customers like Volvo and others committing to purchases to improve their emissions reduction goals and environmental, social and corporate governance (ESG) scores.

Recycling and upcycling scrap metal

Metal fixtures can give buildings lower lifecycle emissions than cheaper alternatives, owing to less frequent replacements. This has increasingly led to institutions requiring bids using the hardy material. To achieve green building certifications, recycled metal also helps.

“Majestic Steel is a big name in the HVAC space, and they’re doing their part in purchasing recycled steel,” Charles said, adding they also have a recycling program. The flat rolled steel supplier says on their website that they pass the savings from using scrap steel on to manufacturers.

Majestic Steel’s scrap recycling program saves 132,000 lbs of steel from landfills every year. And with more companies like Boeing jumping on board, contracting a recycler for all their aircraft to be disassembled at the end of their life, the metal recycling industry is ballooning in size. Domestically, the industry had a growth rate of 5.9% per year on average between 2017 and 2022.

“People are going to start looking at, once a product is over, 'what do I do to make sure it doesn't get back into the landfill,” Charles said. “And they have options.”

In 2022, U. S. Steel recycled approximately 3.0 million metric tons of blast furnace slag and 204,540 metric tons of steel slag. 

“A circular economy is really developing here, from the producer to the manufacturer,” Charles concluded.

Source: U.S. Steel Industry Shows Leadership in Building Decarbonization | ACHR News

Air conditioning, refrigeration, and other cooling technologies account for more than 20 percent of today's global energy consumption, while the refrigerants they use have a global warming potential thousands of times greater than carbon dioxide. In a recent study in the journal Science, a team led by Maryland Engineering Professors Ichiro Takeuchi, Reinhard Radermacher, and Yunho Hwang introduced a high-performance elastocaloric cooling system that could represent the next generation of cooling devices.

Takeuchi calls it "a completely different, completely green, environmentally friendly cooling technology, which bypasses chemical refrigerants to essentially rely on pushing and pulling pieces of metal to create cooling."

Caloric materials—including magnetocaloric, electrocaloric, and elastocaloric materials—can undergo phase transition and release, and absorb heat upon application of various fields and mechanical forces. The key feature is the compression and release of fatigue-resistant nickel-titanium (NiTi) tubes configured in a versatile, multimode heat exchange architecture.

"More than a decade ago, we were just playing with a NiTi wire," Takeuchi said. "By stretching it, you could get a substantial cooling effect one could feel by hand. That was when we started thinking about applying the concept to a cooling device."

Video showing live operation of a multi-mode elastocaloric cooler (at 10x speed). Superelastic NiTi tube bundles are compressed using hydraulic actuators. In this configuration, there are two top bundles and two bottom bundles operated in concert in direct work recovery mode in order to deliver 150 W of cooling power. The left plot is monitoring the temperature of the cooling medium (water) at outlet points of the bundles (blue: top; red: bottom). The right plot shows the temperatures of the heat source (blue) and the heat sink (red) as a function of time. Credit: Maryland Engineering

The team says it's possible to improve the performance of its system enough to make the technology commercially viable within several years. A current prototype can produce 200 watts of cooling capacity, enough to power a compact wine fridge, with plans to expand to window units, whole-house cooling systems, and commercial HVACs eventually.

Source: Elastocaloric cooling system opens door to climate-friendly AC (phys.org)

New laws could soon be in place in Miami-Dade County to protect outdoor workers from the extreme heat.

On Tuesday, the Miami-Dade County Commission passed unanimously the first reading of an ordinance to create a heat standard for outdoor workers. It would require certain employers to have an approved mandatory heat exposure safety program, access to drinking water and shaded recovery periods.

The county could also enforce penalties if employers violate the ordinance. County leaders are calling this an important and historic legislation.

"One death in the hot sun is one too many,” Commissioner Kionne McGhee said. "It is too damn hot not to be able to have water, shade, rest and protection."

"People are dying everywhere from the heat,” County Mayor Daniella Levine Cava said.

The legislation is also a huge win for local worker advocacy organizations in South Florida, who for the past two years have demanded a Miami-Dade heat standard to guarantee protections for outdoor workers.

Michael White works for Whiting-Turner Construction. Right now, they're building a new cancer center on Northwest 14th Street and 10th Avenue.

His day usually starts at 6:30 a.m. and he's not packing up until almost 12 hours later.

"It's been a different type of heat because the humidity is very strong,” White said. "You have to get the job done but you have to pace yourself."

White says light clothing, hydration and breaks are what gets him through the day, but he says this new ordinance is needed.

"It is a serious situation and I appreciate the county is taking a look to try and implement some things that'll make it easier,” White said.

The county commission passed unanimously on the first reading of the ordinance. Now it goes to a committee in September. If it passes as is, the mayor says it'll be the first such law in Florida and the U.S.

Miami-Dade County moves forward with ordinance to protect outdoor workers from extreme heat – NBC 6 South Florida (nbcmiami.com)

Florida Gov. Ron DeSantis talks with audience members during a fundraising picnic for Rep. Randy Feenstra (R-Iowa) on May 13, 2023, in Sioux Center, Iowa. | Charlie Neibergall/AP Photo TALLAHASSEE, Fla. — Several groups sued the DeSantis administration Monday over Florida’s latest anti-immigration law, arguing that it “inflicts enormous harm on people’s ability to go about their daily lives.” Filed in Miami federal court, the lawsuittargets the wide-ranging immigration policies enacted by Florida earlier this year at the behest of Gov. Ron DeSantis, a Republican presidential candidate who regularly criticizes how President Joe Biden is dealing with the surge of migrants crossing into the U.S. at the southern border. In challenging the new law, the groups are seeking to block the state from enforcing it on the grounds that it could impede federal immigration authorities and lead to “unlawful arrest, prosecution, and harassment.” The law in question, FL SB 1718, allows authorities to charge someone with human trafficking if they knowingly transport an undocumented migrant across state lines. And it would prohibit an undocumented immigrant from driving a car even if they have a driver’s license from another state and requires state hospitals that receive Medicaid to ask patients of their immigration status. It “put thousands of Floridians and residents of other States—both citizens and noncitizens alike—at risk of being arrested, charged, and prosecuted with a felony for transporting a vaguely-defined category of immigrants into Florida,” the lawsuit alleges. “Families may be unable to visit each other across state lines. Parents who live near the state border may be unable to drive their children to medical appointments or soccer matches.” The lawsuit was brought by several groups, including the American Immigration Council, Americans for Immigrant Justice, Southern Poverty Law Center and the ACLU Foundation of Florida on behalf of Farmworkers Association of Florida, a non-profit farmworker membership organization with nearly 12,000 members who are both documented and undocumented. It also has nine other unnamed plaintiffs, including one who is a U.S. citizen who serves as a director of a nonprofit organization based in southern Georgia. This plaintiff, as an example, transports immigrants of varying statuses to see medical specialists across state lines to Jacksonville yet now fears possible felony charges “for performing a key aspect of her job, and for doing what she believes to be morally just,” according to the lawsuit. The groups contend Florida’s law should be considered unconstitutional for going “far beyond” federal immigration policies and “penalizing a wide array of conduct that Congress chose not to prohibit.” “It impedes the federal immigration scheme by preventing immigrants from entering Florida,” the lawsuit alleges. “And it puts state officials in the unlawful position of making complex determinations about people’s immigration status and history.” DeSantis and his Republican allies contended during Florida’s session that the immigration crackdown would send a “message” to the Biden administration. The law also included $12 million for Florida to transport migrants from outside the state to Democratic strongholds, a controversial policy deployed by the governor and other leaders like Texas GOP Gov. Greg Abbott, who bused hundreds of migrants to cities like Washington, D.C., Chicago and New York.

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• 220.198 Experiential learning tax credit program.— (1) This section may be cited as the “Florida Experiential 364 Learning Tax Credit Program.”

• (2) As used in this section, the term: (a) “Apprentice” has the same meaning as in s. 446.021(2). (b) “Full time” means at least 30 hours per week. (c) “Preapprentice” has the same meaning as in s. 369 446.021(1). (d)(b) “Qualified business” means a business that is in existence and has been continuously operating for at least 3 years. (e)(c) “Student intern” means a person who has completed at least 60 credit hours at a state university or 15 credit hours at a Florida College System institution, regardless of whether the student intern receives course credit for the internship; a person who is enrolled in a career center operated by a school district under s. 1001.44 or a charter technical career center; or any graduate student enrolled at a state university.

• For taxable years beginning on or after January 1, 2022, a qualified business is eligible for a credit against the tax imposed by this chapter in the amount of $2,000 per apprentice, pre apprentice, or student intern if all of the following apply:

• The qualified business employed at least one apprentice, preapprentice, or student intern in an apprenticeship, preapprenticeship, or internship in which the student intern worked full time in this state for at least 9 consecutive weeks, or the apprentice or preapprentice worked in this state for at least 500 hours, and the qualified business provides the department documentation evidencing each apprenticeship, preapprenticeship, or internship claimed. The department may require the taxpayer to provide the taxpayer’s Registered Apprenticeship Partners Information Data System program identification number and other necessary information, which the department may verify with the Department of Education.

• The qualified business provides the department documentation for the current taxable year showing that at least 20 percent of the business’ full-time employees were previously employed by that business as apprentices, preapprentices, or student interns

• Each apprentice, preapprentice, or student intern provides the qualified business with verification by the apprentice’s, preapprentice’s, or student intern’s state university, Florida College System institution, career center operated by a school district under s. 1001.44, or charter technical career center, or provider of related technical instruction that the apprentice, preapprentice, or student intern is enrolled and maintains a minimum grade point average of 2.0 on a 4.0 scale, if applicable. The qualified business may accept a letter from the applicable educational institution or provider of related technical instruction stating that the apprentice, preapprentice, or student intern is enrolled as evidence that the apprentice, preapprentice, or student intern meets these 17 requirements.

• (4) Notwithstanding paragraph (3)(b), a qualified business that, on average for the 3 immediately preceding years, employed 10 or fewer full-time employees may receive the tax credit if it provides documentation that it previously hired at least one apprentice, preapprentice, or student intern and, for the current taxable year, that it employs on a full-time basis at least one employee who was previously employed by that qualified business as an apprentice, preapprentice, or a student intern. (5)(a) A qualified business, including all subsidiaries, may not claim a tax credit of more than $10,000 in any one taxable year.

• (b) The combined total amount of tax credits which may be granted to qualified businesses under this section is $2.5 million in each of state fiscal years 2021-2022, and 2022-2023, 2023-2024, and 2024-2025. The department must approve the tax credit prior to the taxpayer taking the credit on a return. The department must approve credits on a first-come, first-served basis.

• (6) The department may adopt rules, including emergency rules pursuant to s. 120.54(4), governing the manner and form of applications for the tax credit and establishing qualification requirements for the tax credit. All conditions are deemed met for the adoption of emergency rules pursuant to s. 120.54(4).

• (7) A qualified business may carry forward any unused portion of a tax credit under this section for up to 2 taxable years.

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KEEPING FLORIDA COOL: FLORIDA REFRIGERATION AND AIR CONDITIONING CONTRACTORS COMMEND LEGISLATURE ON PASSING BILL TO FIX THE WARRANTY LOOPHOLE THAT LEAVES NEW HOMEOWNERS PAYING FOR REPAIRS HVAC REPAIRS OUT OF POCKET

The legislation ensures that the manufacturer warranty for an HVAC system is tied with the property instead of the homeowner

Tallahassee, Fla, July 10 2023 - The Florida Refrigeration and Air Condition Contractors Association

(FRACCA) commends Governor Ron DeSantis on signing HB 1203 – Registration and Transfers of Heating, Ventilation, and Air-Conditioning System Manufacturer Warranties, which ensures that when a new homeowner purchases a residential property, the heating, ventilation, and air conditioning (HVAC) systems is automatically transferred to the new owner and continues in effect as if the new owner was the original purchaser of the system.

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The U.S. Environmental Protection Agency (EPA) recently issued a final rule to implement a 40% reduction below baseline levels of HFC production from 2024 through 2028. The rule aligns with the AIM Act, which was passed in December 2020 and gave the EPA the authority to phase down HFCs to 15% of their baseline levels by 2036.

The U.S. began the phasedown in 2022, with an initial 10% reduction in HFC production from the baseline level, while 2024 brings an additional 30% cut. The baseline was derived from the three highest nonconsecutive years of HFC production and/or import between 2011 and 2019.

This final rule establishes the methodology for allocating HFC production and consumption allowances, starting with calendar year 2024 allowances. Companies that produced or imported bulk HFCs in 2021 and 2022 are eligible for allowances in 2024 through 2028. According to EPA, the methodology will be similar to the approach used for calendar years 2022 and 2023, while incorporating former new market entrants from an earlier set-aside pool as general pool allowance holders.

“This latest allocation rule is a critical step in the implementation of the AIM Act schedule for phasing down HFC refrigerants,” said Stephen Yurek, president and CEO of AHRI. “Our industry appreciates the work of the EPA and the timely issuance of this rule as we prepare for the next HFC reduction step-down next January.”

The final rule also amends the HFC consumption baseline to reflect corrected data submitted to EPA. Specifically, EPA is amending the consumption baseline from 303,887,017 Metric Tons of Exchange Value Equivalent (MTEVe) to 302,538,316 MTEVe to account for verified revisions from entities for 2011 through 2013, as well as the Agency’s internal review of baseline calculation methodologies.

EPA also recently finalized a good cause final rule that makes a minor adjustment to the production baseline and associated phasedown schedule. Specifically, EPA adjusted the baseline from 382,554,619 MTEVe to 382,535,439 MTEVe to reflect additional destruction and transformation of HFCs that occurred during 2011–2013. This corrected production baseline begins applying to allowance allocations for calendar year 2024.

Under the AIM Act, by October 1 of each calendar year, EPA must calculate and determine the quantity of production and consumption allowances for the following year. EPA will start using the approach established through this rulemaking to issue 2024 allowances by October 1, 2023.

EPA is planning two additional regulatory actions under the AIM Act in 2023. The first is a final rule placing restrictions on the use of HFCs in certain sectors to facilitate sector-based transitions to alternative chemicals, and the second is a proposed rule establishing certain requirements for the management of HFCs and HFC substitutes in equipment, such as air conditioners.

Article courtesy of ACHR News - 7/13/2024