National Association of Realtors® Selects Bank of America Merrill Lynch to Develop Financial Wellness Program for Members

Chicago, IL – November 4th, 2017 (nar.realtor) Nearly nine in 10 Realtors® are independent contractors of their real estate firms and typically don’t have access to traditional employer-provided benefits, such as retirement savings plans. To help Realtors® better secure their financial futures and reach their retirement savings goals, the National Association of Realtors® has selected Bank of America Merrill Lynch to develop a financial wellness program with customized benefits to members who participate.

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While the age and business activity of NAR’s membership varies, the median gross income of Realtors® in 2016 was $42,500; 43 percent are not saving for retirement and only 30 percent own investment properties. Upon assuming office, 2017 NAR President Bill Brown pledged to help Realtors® take charge of their financial lives and develop new education and resources for wealth building, business planning and investing in real estate.

“Despite finding great success in their careers, far too many real estate professionals are falling short with their retirement savings goals,” said Brown, a Realtor® from Alamo, California and founder of Investment Properties, a division of his family real estate business. “I’m incredibly excited about this opportunity with Bank of America Merrill Lynch, and I think it’s going to offer tremendous benefit for our members.”

As part of the REALTOR Benefits® Program, the financial wellness program will provide Realtors® with personalized financial education services, as well as online resources and financial workshops. The program will help assess financial wellness delivering a multi-channel program designed to assist NAR members achieve their financial goals based on age, life stage and needs.

“NAR does so much to help homebuyers overcome financial challenges to achieve their dreams, so I made it a priority to help our members build a sustainable financial plan to carry them through slower sales years and into their retirement,” said Brown. “This is a positive step toward making sure our members are on strong financial footing.”

In 2016, NAR launched the eight-hour course Real Estate Investing (link is external): Build Wealth Representing Investors and Becoming One Yourself, which offers strategies to help members with smart practices for investing. The association plans to identify and roll out additional member programs, tools and services to promote financial wellness and wealth building.

Additional information about the Bank of America Merrill Lynch program being developed for Realtors® will soon be available at www.nar.realtor/RealtorBenefits.

The REALTOR Benefits® Program is the official member benefits program of the National Association of Realtors®, connecting members with discounts and unique offers on products and services just for Realtors® from more than 30 companies recognized as leaders in their respective industries.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.3 million members involved in all aspects of the residential and commercial real estate industries.

Americans’ Financial Satisfaction Hits 24-Year High: AICPA Index

The AICPA’s Third Quarter 2017 Personal Financial Satisfaction Index (PFSi) Sets All-Time Record

New York, NY – October 26, 2017 (BUSINESS WIRE) Increased gains in the stock market and a high number of available jobs has Americans experiencing their highest level of personal financial satisfaction in the 24-year history of the AICPA’s Personal Financial Satisfaction Index (PFSi). The new high reached by the Q3 2017 PFSi, released today, eclipses the previous record reached right before the great recession (Q4 2006). The AICPA began issuing the PFSi quarterly in January 2015, with the data for the index tracking back to 1994.

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The PFSi is calculated as the Personal Financial Pleasure Index minus the Personal Financial Pain Index, with positive readings signaling that Americans are feeling more financial pleasure than pain. The Q3 PFSi measured 25.9, a 2.6-point increase from the prior quarter. The increase was due to a modest gain (2.1 points) in the Personal Financial Pleasure Index and a slight (0.5 point) decrease in the Personal Financial Pain Index.

“By and large the pleasure index factors have been trending up for some time as we have mostly recovered from the great recession,” said Mark Astrinos, CPA/PFS and member of the AICPA PFS Credential Committee. “While we all benefit from the surge of capital markets and real estate growth, it’s prudent that our financial health safeguards remain in place. This means ensuring that you re-balance portfolios to reduce risk and maintaining adequate cash reserves for when economic times are more challenging.”

The Personal Financial Pleasure Index, at 68.1, is up 2.1 points from the previous quarter, continuing its steady increase and setting a record for the third quarter in a row. The Real Home Equity Per Capita Index, based on data issued for April, experienced the largest increase over the previous quarter (4.8 points), though it remains significantly (16.3 percent) below the 2006 all-time high. The changes in home equity have been due to increases in the market value of real estate exceeding increases in mortgages outstanding.

The PFS 750 Market Index continues to be the biggest contributor to the Pleasure Index, a trend that began in 2009 and continued in Q3 as the component rose to a record high for the third quarter in a row. The U.S. economy has continued its steady expansion as corporate earnings are improving and interest rate policy remains accommodating. The strongest sectors have been performing well, with the banking sector leading the way followed by aerospace and defense.

Financial Infographic

“As the stock market drives American’s financial satisfaction to new all-time highs, many are beginning to question whether this trend is sustainable,” said Robert Westley, CPA/PFS and member of the AICPA PFS Credential Committee. “As individuals begin to fear a pullback, it’s important to keep in mind that the stock market is largely unpredictable and any attempts to time the market often prove to be ineffective at best, and injurious at worst. An investor’s best defense against the market’s unpredictability is to have a solid financial plan that is irrespective of how the market is performing. It’s key to your financial plan to align your portfolio with your personal financial goals and their corresponding time horizons.”

The Personal Financial Pain Index, at 42.1, saw two factors decrease from the previous quarter, combining to drop the index 0.5 points which contributed to the overall improvement in the PFSi. The decrease from the preceding quarter was led by a 2.9 point decrease in loan delinquencies. Though the current reading of delinquencies on mortgages (3.93 percent) is well below the peak delinquency rate for mortgages (11.26 percent) set in the spring of 2010, it is still above what was typical between 1994 through 2003 (2.12 percent).

However, there is reason to believe we may see an increase in loan delinquencies in Q4. The recent onslaught of hurricanes and wildfires across the U.S. left more damage and affected a much larger area than Hurricane Katrina did in 2005. Though not reflected in Q3, it is logical to expect that we will see some negative impact from these storms in the quarters ahead. As a comparison point, Katrina ultimately led to a significant (34 percent) increase in delinquencies in the areas it damaged. Fannie Mae, Freddie Mac and the FHA have all announced a temporary moratorium on any actions as a result of mortgages going unpaid in storm devastated areas.

Also contributing to the decrease in the Pain Index was a 2.0 point drop in the inflation index (The Q3 Inflation Index relies on the Fed’s August level). The current value is 34, down 5.5 percent from 36 in Q2 and 42.4 percent above last year’s level. Inflation is the most volatile factor contributing to the PFSi and with absolute levels so low, small changes result in large percent gains, such as the 42.4 percent increase that still leaves it below the Fed’s target.

Additional Findings from the Q3 2017 PFSi:

  • The Job Openings Per Capita Index, the second largest contributor to the Pleasure Index, increased 3.6 percent (2.5 points) since the prior quarter, continuing its rise for the third quarter in a row. Compared to Q2, the strongest job growth has been in food services, professional and business services and health care. At a total of 6.2 million, overall job openings are setting records.
  • Personal taxes, still the leading overall contributor to financial pain for the sixth quarter in a row, showed a 1.9 point increase from the previous quarter and a 0.8 point increase from the prior year level.
  • The AICPA Economic Outlook Index, which captures the expectations of CPA executives in the year ahead for their companies and the U.S. economy, had a recent low point occur in Q1 2016. Since then, there has been an uptrend (about 5 percent per quarter for 2016), except for a slight retreat (1.3 percent) in Q2 2017. The survey was conducted in August.
  • Underemployment, at 39 points, is 2.8 percent higher than the previous quarter level but 13 percent below the prior year. In comparison, its peak value was 84.3 points in Q4 2009. It is still about 1.8 percent above its average value before the great recession.

Additional information on the PFSi can be found at: www.aicpa.org/PFSi.

Methodology

The Personal Financial Satisfaction Index (PFSi) is the result of two component sub-indexes. It is calculated as the difference between the Personal Financial Pleasure Index and the Personal Financial Pain Index. These are comprised of four equally weighted factors, each of which measure the growth of assets and opportunities, in the case of the Pleasure Index, and the erosion of assets and opportunities, in the case of the Pain Index.

About the AICPA’s PFP Division

The AICPA’s Personal Financial Planning (PFP) Section is the premier provider of information, tools, advocacy, and guidance for CPAs who specialize in providing estate, tax, retirement, risk management, and investment planning advice to individuals, families, and business owners. The primary objective of the PFP Section is to support its members by providing resources that enable them to perform valuable PFP services in the highest professional manner.

CPA financial planners are held to the highest ethical standards and are uniquely able to integrate their extensive knowledge of tax and business planning with all areas of personal financial planning to provide objective and comprehensive guidance for their clients. The AICPA offers the Personal Financial Specialist (PFS) credential exclusively to CPAs who have demonstrated their expertise in personal financial planning through testing, experience and learning, enabling them to gain competence and confidence in PFP disciplines.

About the American Institute of CPAs

The American Institute of CPAs (AICPA) is the world’s largest member association representing the CPA profession, with more than 418,000 members in 143 countries, and a history of serving the public interest since 1887. AICPA members represent many areas of practice, including business and industry, public practice, government, education and consulting. The AICPA sets ethical standards for its members and U.S. auditing standards for private companies, nonprofit organizations, federal, state and local governments. It develops and grades the Uniform CPA Examination, offers specialized credentials, builds the pipeline of future talent and drives professional competency development to advance the vitality, relevance and quality of the profession.

The AICPA maintains offices in New York, Washington, DC, Durham, NC, and Ewing, NJ.

Media representatives are invited to visit the AICPA Press Center at www.aicpa.org/press

About the Association of International Certified Professional Accountants

The Association of International Certified Professional Accountants (the Association) is the most influential body of professional accountants, combining the strengths of the American Institute of CPAs (AICPA) and The Chartered Institute of Management Accountants (CIMA) to power opportunity, trust and prosperity for people, businesses and economies worldwide. It represents 650,000 members and students in public and management accounting and advocates for the public interest and business sustainability on current and emerging issues. With broad reach, rigor and resources, the Association advances the reputation, employability and quality of CPAs, CGMAs and accounting and finance professionals globally.

Contacts

Jonathan Lynch
(212) 596-6033
Jonathan.Lynch@aicpa-cima.com

or

James Schiavone
(212) 596-6119
James.Schiavone@aicpa-cima.com

HOME Survey: Economic and Financial Outlook, Attitudes About Home Buying and Selling on the Rise

Washington, D.C. – September 25, 2017 (nar.realtor) Existing-homes sales have retreated in four of the past five months, but new survey findings from the National Association of Realtors® indicate it is not because of a lack of confidence from consumers about buying and selling a home, or based on their views about the direction of the economy and their finances.

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That’s according to NAR’s third quarter Housing Opportunities and Market Experience (HOME) survey(1) , which also found that two-thirds of households think saving for a down payment is challenging, and roughly half of renters expect to pay more in rent next year.

This quarter, there appears to be a revival from renters that now is a good time to buy a home. After dipping to roughly half of renters last quarter (52 percent), the share who believe now is a good time climbed to 62 percent (60 percent a year ago). Overall, current homeowners (80 percent), households with higher incomes and those living in the more affordable Midwest and South regions are the most optimistic about buying right now.

Amidst the steady gains in home values seen in many parts of the country, the share of homeowners that believe now is a good time to sell is also inching higher. Eighty percent of homeowners think now is a good time to list their home for sale (a new survey high), which is up from last quarter (75 percent) and even more so than a year ago (67 percent).

Lawrence Yun, NAR chief economist, says it is great news that homebuyer and seller optimism is advancing, but it remains unclear if it will actually translate to more sales. “The housing market has been in a funk since early spring because of the ongoing scarcity of new and existing homes for sale,” he said. “The pace of new home construction has not meaningfully broken out this year, and not enough homeowners at this point have followed through with their belief that now is a good time to sell. As a result, home shoppers have seen limited options, stiff competition and weakening affordability conditions.”

Added Yun, “Buyer demand is robust this fall, but the disappointing reality is that sales will continue to undershoot their full potential until supply levels significantly improve.”

Economic and financial outlook brightens

More households this quarter (57 percent) believe the economy is improving compared to the second quarter (54 percent) and a year ago (48 percent). Continuing the complete reversal from a year ago, those living in rural and suburban areas were more optimistic about the economy than respondents residing in urban areas. A majority of homeowners and those with incomes above $50,000 also had a positive outlook on the economy.

The rebound in economic confidence this quarter are also giving households increased assurances about their financial situation. The HOME survey’s monthly Personal Financial Outlook Index2, showing respondents’ confidence that their financial situation will be better in six months, jumped from 57.2 in June to 62.0 in September. A year ago, the index was 58.6.

“Jobs are plentiful, wage growth is finally showing signs of life, home values are up considerably in the past five years and the stock market is at record highs,” said Yun. “The economy is not perfect, and growth overall is still sluggish, but the financial health of the typical household looks as healthy as it has since the recession.”

Most renters likely to continue renting – even if their rent increases

This quarter, non-homeowners were asked if they expect their rent to increase over the next year, and given their current financial situation, what impact paying more in rent would have on their living arrangements.

Roughly half of current renters expect to pay more in rent next year (51 percent). If in fact their rent does increase, most will either resign their lease anyway (42 percent) or move to a cheaper rental. Only 15 percent of respondents will consider buying a home.

“Even though the typical down payment of a first-time buyer has been 6 percent for three straight years, two-thirds of respondents indicated that saving for one is difficult right now,” said Yun. “Rents and home prices have outpaced incomes in the past few years, and this is undoubtedly impacting their ability to put aside savings for a home purchase, even if they increasingly believe it’s a good time to buy. Heading into next year, higher home prices and limited inventory in the affordable price range will likely continue to hold back a share of renters who would prefer to be homeowners.”

About NAR’s HOME survey
In July through early September, a sample of U.S. households was surveyed via random-digit dial, including a mix of cell phones and land lines. The survey was conducted by an established survey research firm, TechnoMetrica Market Intelligence. Each month approximately 900 qualified households responded to the survey. The data was compiled for this report and a total of 2,709 household responses are represented.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

# # #

1. NAR’s Housing Opportunities and Market Experience (HOME) survey tracks topical real estate trends, including current renters and homeowners’ views and aspirations regarding homeownership, whether or not it’s a good time to buy or sell a home, and expectations and experiences in the mortgage market. New questions are added to the survey each quarter to reflect timely topics impacting real estate.

HOME survey data is collected on a monthly basis and will be reported each quarter. New questions will be added to the survey each quarter to reflect timely topics impacting the real estate marketplace. The next release is scheduled for Monday, June 12, 2017 at 10:00 a.m. ET.

2. Index ranges between 0 and 100: 0 = all respondents believe their personal financial situation will be worse in 6 months; 50 = all respondents believe their personal financial situation will be about the same in 6 months; 100 = all respondents believe their personal situation will be better in 6 months.

Media Contact:

Adam DeSanctis
(202) 383-1178
Email

SURVEY: Nearly 63% of Moms Say Their Adult Children Are Unprepared To Live On Their Own, Over One-Third Unwilling or Unable To Pitch In Financially

This Mother’s Day finds moms anxious about affordable housing for themselves and their families

Washington, D.C. – May 4th, 2017 (PRNewswire-USNewswire) This Mother’s Day, adult children living with their parents might consider moving out as a gift to mom, if they’re financially prepared to do so. According to a new survey of 1000 mothers by The NHP Foundation, a not-for-profit provider of service-enriched affordable housing, many are concerned about the ability of their adult children to live on their own. Nearly a third (29.86%) of the moms queried are anxious about their grown children needing to stay with them for an extended period of time. Here’s a look at what else concerns today’s moms.

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Failure to launch?

Nearly 63% of moms say their adult children are not fully prepared to live on their own.

Only 30% of moms say that their adult children who live with them are actively looking for other places to live, and less than half (41%) say their kids pay rent. On the bright side, 67 % of the adult children help around the house, and 65% of them are employed.

The mom cohort is very aware that their grown children don’t have it easy. Ninety percent are concerned about rising housing costs, with 43% saying they are “very concerned” on their kids’ behalf. And nearly 40% of moms worry at least once a day about their adult children’s ability to afford desirable housing.

Yet, some moms are either unwilling or unable to offer financial help once the kids do move out. Only one-third of moms would co-sign a loan for their children, and even fewer (24%) would help subsidize rent or a mortgage. Nearly 36% say they aren’t prepared to help their adult children financially in any way.

Moms rule the roost

Fifty-two percent of those surveyed make family financial decisions either alone or with “some input” from a partner.

These moms operate as family CFOs, taking a more active role in family finance and investments – not surprising since women make up 47% of the nation’s workforce. “Women wield more and more influence in the management of personal and family finances,” comments NHPF CEO Richard Burns, “Thirty seven percent of married women are now the breadwinners in their families. That statistic alone made it crucial for us to tap into this group and gauge their thoughts about housing for their family.”

Many women live with extended family. Seventeen percent of those with a partner and children also report parents or other relatives living with them, emblematic of the modern “sandwich generation.” Coined by social worker Dorothy Miller in 1981, the term refers to women in their 30s and 40s who were sandwiched between young children and aging parents as the primary caregiver for both. But The NHP Foundation’s Burns has expanded the term’s definition beyond health to other basic needs such as housing, finding that those who fall under this new “sandwich generation” bracket have a new set of housing anxieties.

New administration brings concerns

Nearly 40% of moms in the survey say they have no confidence that the new administration will make affordable housing a priority.

This is coupled with worries about affording rent or mortgage – 56% of those surveyed worry about affording those payments. Nearly 74% are concerned that they or someone they know will find themselves “cost-burdened,” defined as spending more than 30% of one’s income on housing.

Is there a bright side for anxious moms this Mother’s Day?

According to NHPF President and CEO Burns, his organization is looking to the government to continue such successful programs as LIHTC (Low Income Housing Tax Credit), which gives incentives to private equity for the development of affordable housing. Explains Burns, “LIHTC is vital to enabling providers to offer stable, long-term affordable housing options”.

The NHP Foundation is going even further to find solutions to help alleviate family concerns about housing. The organization is looking at new private and public partnerships designed to increase its stock of quality affordable housing. NHPF has also been selected by the University of Virginia School of Public Policy as part of a study seeking new models to help ensure that this and future generations are able to afford desirable places to live.

Other recent research undertaken by NHPF has found that that 75% of Americans worry about losing their housing. The organization determined that 76% of millennials have made compromises in order to find affordable housing and, finally, a third of Baby Boomers report “housing affordability” anxiety at least monthly.

For more information on this research and The NHP Foundation, please visit www.nhpfoundation.org

About The NHP Foundation

Headquartered in New York City with offices in Washington, DC, and Chicago, IL, The NHP Foundation (NHPF) was launched on January 30, 1989, as a publicly supported 501(c) (3) not-for- profit real estate corporation. NHPF is dedicated to preserving and creating sustainable, service-enriched multifamily housing that is both affordable to low and moderate income families and seniors, and beneficial to their communities. NHPF also provides a robust resident services program to nearly 18,000 community residents. Through partnerships with major financial institutions, the public sector, faith-based initiatives, and other not-for-profit organizations, NHPF has 47 properties, including over 8,000 units, in 15 states and the District of Columbia.

Media Contact

Marijane Funess
Crenshaw Communications
(212) 367-9746

NAR HOME Survey: Economic, Financial Optimism Surges; Renters Lukewarm About Buying

Washington, D.C. – March 15, 2017 (nar.realtor) Multiple years of uninterrupted job gains and hope that the best is yet to come in 2017 are igniting consumer confidence across the country, and especially in rural and middle America, according to new consumer survey findings from the National Association of Realtors®. The survey additionally found a growing disparity among renters who think it’s a good time to buy and homeowners who think it’s a good time to sell.

NAR logo

In NAR’s ongoing quarterly Housing Opportunities and Market Experience (HOME) survey(1), respondents were asked about their confidence in the U.S. economy and various questions about their housing expectations.

In the first three months of 2017, the share of households believing the economy is improving soared to its highest share in the survey’s five-quarter history (62 percent), and is up from 54 percent last quarter and 48 percent in March 2016.

Lawrence Yun

Lawrence Yun

In an extraordinary reversal from previous quarters, NAR Chief Economist Lawrence Yun says the surge in positive sentiment about the economy is primarily from respondents living in the Midwest (67 percent; 51 percent last quarter) and rural areas (63 percent; 43 percent last quarter). Last March, only 49 percent of Midwesterners and 35 percent of those living in rural areas thought the economy was improving.

“Confidence levels generally rise after a presidential election as the nation hopes for the best. Even though it is a highly polarized country, consumers for the most part have upbeat feelings about the economy right now,” he said. “Stronger business and consumer morale typically lead to even more hiring and spending, which in turn encourages more households to make big decisions like buying a home. These positive developments would be especially good news for prospective homebuyers in the more affordable Midwest region.”

Higher confidence in the economy is also translating to better feelings about households’ financial situation. The HOME survey’s monthly Personal Financial Outlook Index(2) showing respondents’ confidence that their financial situation will be better in six months, jumped to its highest reading in the survey, climbing to 62.6 in March from 59.8 in December 2016. A year ago, the index was 58.1.

Affordability and inventory challenges dimming renter optimism

On the cusp of the busy spring season, most households believe now is a good time to buy a home. However, confidence continues to trickle backwards among renters. Fifty-six percent of renters said now is a good time to buy, which is down both from last quarter (57 percent) and a year ago (62 percent). Eighty percent of homeowners (78 percent in December 2016; 82 percent in March 2016) think now is a good time to make a home purchase. Younger households, renters and those living in the costlier West region – where prices continue to spike – are the least optimistic.

“Inventory conditions are even worse than a year ago(3) and home prices and mortgage rates are on an uphill climb,” added Yun. “These factors are giving many renter households a pause about it being a good time to buy, even as their job prospects improve and wages grow. Unless there’s a significant boost in supply levels this spring, these constraints will unfortunately slow or delay some prospective buyers’ pursuit of purchasing a home.”

Led by the West, more homeowners view selling favorably right now

One promising trend that could alleviate supply shortages is the notable bump in the share of respondents this quarter who believe now is a good time to sell a home. Sixty-nine percent of homeowners think now is a good time to sell, which is up from last quarter (62 percent) and a year ago (56 percent). Continuing the trend over the past year, those in the West continue to be the most likely to think now is a good time to sell (77 percent), while also being the least likely to think it’s a good time to buy (61 percent).

William E. Brown

William E. Brown

NAR President William E. Brown, a Realtor® from Alamo, California, says homeowners looking to trade up or move down this spring could find themselves in a tricky spot without careful planning and a reliable expert on their side. “Demand far outpaces supply in many parts of the country right now, which means homeowners will likely sell their home much quicker than the time it takes to buy another,” he said. “Before listing, it’s best to have a carefully crafted plan in place. In addition to assisting in the hunt for a new home, a Realtor® is an invaluable negotiating partner in the common situation where a buyer’s new home purchase is contingent upon selling their property currently up for sale.”

About NAR’s HOME survey

In January through early March, a sample of U.S. households was surveyed via random-digit dial, including half via cell phones and the other half via land lines. The survey was conducted by an established survey research firm, TechnoMetrica Market Intelligence. Each month approximately 900 qualified households responded to the survey. The data was compiled for this report and a total of 2,698 household responses are represented.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

# # #

1. NAR’s Housing Opportunities and Market Experience (HOME) survey tracks topical real estate trends, including current renters and homeowners’ views and aspirations regarding homeownership, whether or not it’s a good time to buy or sell a home, and expectations and experiences in the mortgage market. New questions are added to the survey each quarter to reflect timely topics impacting real estate.

HOME survey data is collected on a monthly basis and will be reported each quarter. New questions will be added to the survey each quarter to reflect timely topics impacting the real estate marketplace. The next release is scheduled for Monday, June 12, 2017 at 10:00 a.m. ET.

2. Index ranges between 0 and 100: 0 = all respondents believe their personal financial situation will be worse in 6 months; 50 = all respondents believe their personal financial situation will be about the same in 6 months; 100 = all respondents believe their personal situation will be better in 6 months.

3. Total housing inventory at the end of January was at 1.69 million existing homes available for sale, which is 7.1 percent lower than a year ago (1.82 million) and has fallen year-over-year for 20 straight months.

Media Contact:

Adam DeSanctis
(202) 383-1178
Email