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The following testimony is submitted on behalf of the members of the
MHARR commends the Subcommittee on Insurance, Housing and Community Opportunity, Chairperson
Today's manufactured homes are a much superior product than the "mobile homes" of years past due to the maturation of the industry, innovative manufacturing techniques that take full advantage of the efficiencies inherent in indoor production and assembly, and updates to the federal law that governs the industry - contained in the Manufactured Housing Improvement Act of 2000 - that ensure the proper installation of all manufactured homes and the prompt resolution of consumer issues in addition to the regulation of manufactured housing construction and safety as established by the original 1974 manufactured housing law.
Manufactured housing is an outstanding value for consumers. Factory construction allows builders to produce manufactured homes for 10-35% less than the cost of comparable site-built construction. These savings, in turn, are passed on to homebuyers, as the average price (without land) for a manufactured home is
The manufactured housing industry is also uniquely American. Comprised of thousands of mostly smaller businesses, it has historically been not only the nation's leading source of inherently affordable home ownership, but an important source of manufacturing jobs and job opportunities in related industries across the heartland of America, including retail centers, communities, component fabricators and suppliers, transporters, insurers and finance companies, among many others. Today, though, millions of Americans who wish to own and live in their own home and are attracted to manufactured housing because of its affordability and quality are unable to purchase a manufactured home because of discrimination rooted in federal policies and particularly HUD's failure - as the industry's federal regulator - to fully and properly implement crucial reforms contained in the 2000 law.
The numbers are startling. Over the past decade, manufactured home production has declined by more than 86% (from 373,143 homes in 1998 to 50,046 in 2010 and 50,000 +/- in 2011). Over the same period, nearly 75% of the industry's production facilities have closed (from 430 to fewer than 110), as have more than 7,500 retail centers. This represents a devastating loss of affordable housing opportunities for lower and moderate-income American families, while tens, if not hundreds of thousands of jobs throughout the manufactured housing industry have simply disappeared.
As these statistics demonstrate, the industry's downturn began long before the financial crisis and decline of the broader housing market starting in 2008, and has been much more severe. This indicates that while the manufactured housing market is not immune from trends within the broader economy and the broader housing market, its unprecedented decline - both in productions levels and duration - is a consequence of other factors unique to manufactured housing, specifically, continuing and worsening financing and regulatory discrimination against manufactured housing and manufactured home-buyers that flows directly from policy decisions by HUD concerning the implementation of the Manufactured Housing Improvement Act of 2000.
That watershed law, enacted by
First, it has enabled and facilitated discrimination against manufactured housing and manufactured homebuyers in public and private financing by the
Second, the affordability of manufactured housing is being needlessly undermined by unnecessary and unnecessarily costly expansions of federal regulation wholly outside of the consensus process and other reforms established by the 2000 law. These policies, moreover, by disproportionately increasing regulatory burdens, compliance costs and financing difficulties for the industry's smaller independent businesses, are destroying competition and underwriting the domination of the manufactured housing market by one or two large conglomerates to the ultimate detriment of consumers and the industry as a whole.
It must be stressed, however, that the 2000 law, itself, is not at fault. Indeed,
As a result, the solution for the industry and consumers of affordable housing does not lie in the enactment of more laws or amendments to the existing law. Rather it lies in effective oversight by
The following sections, accordingly: (1) document key 2000 law reforms that HUD has failed to fully and properly implement; (2) detail the negative impacts of that failure on both the industry and manufactured homebuyers; and (3) explain and refute the rationalizations and excuses that HUD has offered for its distortion of these reforms and the 2000 law.
II. HISTORY OF THE FEDERAL MANUFACTURED HOUSING PROGRAM AND FEDERAL REGULATION
Manufactured housing is affordable housing, historically used primarily by lower and moderate-income families. In order to maintain that affordability without the need for costly government subsidies, manufactured housing construction and safety must be regulated at the federal level. Federal regulation allows the full cost efficiencies and savings of factory-based construction to be passed to homebuyers by ensuring: (1) federal preemption of state and local standards, regulations and requirements, which facilitates interstate commerce and allows manufactured homes to be sited anywhere in
These unique concepts to ensure affordable homeownership, especially for lower and moderate-income families, were enshrined by
As manufactured housing progressed and evolved into full-fledged housing, however, both
1. Specific congressional recognition of manufactured housing as "affordable" housing and mandatory consideration of affordability in all decisions relating to the standards and their enforcement (section 602);
2. Creation of an independent, statutory consensus committee comprised of representatives of all program stakeholders with defined authority and procedures to consider, evaluate and recommend new or revised standards, enforcement regulations, interpretations and enforcement and monitoring practices and policies (section 604);
3. Presumptive Manufactured Housing Consensus Committee (MHCC) prior review of all program policies and practices of general applicability and impact (section 604(b)(6));
4. Mandatory appointment of a non-career manufactured housing program administrator as a statutory "responsibility" of the Secretary (Section 620);
5. Significantly enhanced preemption, to be broadly and liberally construed, applicable to all state or local standards or requirements (section 604(d));
6. Establishment of preemptive minimum federal installation standards as part of the
7. Establishment of a federal dispute resolution program for states without a state law alternate dispute resolution program meeting specified criteria (section 623);
8. Mandatory congressional appropriations approval of any change to the user fee paid by manufacturers to fund the program (section 620);
9. A prohibition on the use of any such revenues for any purpose not "specifically authorized" by the law as amended (section 620); and
10. Provisions requiring separate and independent contractors for all contract-based program functions including in-plant monitoring and inspections (section 620).
HUD, however, as detailed herein, has failed to fully and properly implement these reforms, effectively leaving manufactured homes as second-class "trailers" for purposes of federal regulation, financing, zoning, placement, insurance and other purposes, subject to overt and specific forms of discrimination that have undermined the availability of affordable manufactured homes and the ability of lower and moderate-income consumers to purchase and own a home that they can truly afford.
III. SPECIFIC 2000 LAW REFORMS THAT HAVE NOT BEEN FULLY AND PROPERLY IMPLEMENTED BY HUD
1. HUD Has Not Appointed a Non-Career Program Administrator
Section 620(a)(1)(C) of the 2000 law directs HUD to "provid[e] ... funding for a non-career administrator within the Department to administer the manufactured housing program."
Without an appointed administrator, the HUD program today remains what it has always been since the inception of federal regulation in 1976, a "trailer" program, focused on "improving" presumptively deficient manufactured housing (even though the industry today is producing its best, highest quality homes), instead of increasing the availability and utilization of manufactured housing as a superior source of affordable, non-subsidized home ownership, as directed by
This negative program culture harms the public image of manufactured housing, negatively affecting sales, appreciation, financing, zoning, placement and a host of other matters to the detriment of both the industry and consumers. Moreover, at present, with career-level program management, the manufactured housing program is and remains cut-off from mainstream policy-making within HUD. This isolates manufactured housing from initiatives that could benefit the industry and consumers, allows continuing discrimination against manufactured housing and its consumers within HUD and elsewhere within the government, and leaves manufactured housing in perpetual "second-class" status at HUD.
HUD has maintained since 2004 that the 2000 reform law "contains no express or implied requirement for the Secretary to appoint a non-career administrator." (See, e.g.. Attachment C; Attachment D at p.2). However, this represents a fundamental misreading of the 2000 law.
Section 620(a) of the Act, as amended by the 2000 law, states that the Secretary of HUD "may -- (1) establish and collect from manufactured home manufacturers a reasonable fee ... to offset the expenses incurred by the Secretary in connection with carrying out the responsibilities of the Secretary under this title, including ... (A) conducting inspections and monitoring ... [and] (C) providing the funding for a non-career administrator within the Department to administer the manufactured housing program." (Emphasis added).
By the plain wording of this section, it is the establishment of the program user fee that is subject to the qualifier "may" and is, therefore, permissive. Once that fee is established, however as it has been for decades by regulation it is to be used to offset expenses incurred in carrying out the Secretary's "responsibilities" as delineated in section 620(a)(l)(A-G). As a matter of black-letter statutory construction, giving each word of the 2000 law its plain, ordinary and common meaning, a congressionally prescribed "responsibility" of a federal official is mandatory, not permissive or discretionary. If HUD's construction of section 620(a)(1) were correct, its "responsibility" to "conducffj inspections and monitoring" of manufactured homes, their production and their compliance with the federal standards under section 620(a)(1)(A) would be just as discretionary as its "responsibility" under section 620(a)(1)(C), but HUD has never made any such claim or assertion over the entire 36-year history of the program nor would it. Thus, construing section 620(a)(1) consistently, as a whole, the Secretary's responsibility to appoint a non-career administrator for the program is every bit as mandatory as the responsibility to conduct inspections and monitoring in order to enforce the federal standards and
2. Collective Industry Representation on the MHCC Must be Restored
The Manufactured Housing Consensus Committee, as recommended by the
Consequently, when the MHCC was organized in 2002, HUD correctly and properly appointed, among seven total "producer" representatives, the leaders of the industry's two national trade organizations (MHARR and the
This action has severely impacted the representation of the industry on the MHCC, depriving it of the benefits of the collective knowledge, know-how, expertise and institutional memory that it has assembled in
Thus, industry businesses and most particularly smaller businesses which, for years, have entrusted such functions to collective representatives, have a right - equal to any other MHCC interest group - to be represented on a collective basis. And, in fact, no similar limitation has been placed on any other MHCC interest group. For example, the Executive Director and three other members of the Board of Directors of the same national organization of manufactured homeowners currently serve as MHCC members. Such appointments, combined with the complete de facto ban on collective industry representation, have drastically skewed the orientation of the MHCC, undermining its carefully crafted balance as required by the 2000 law.
For these reasons alone, collective national industry representation should be restored to the MHCC, given the MHCC's unique statutory mandate, authority and purpose. More importantly, though, recently published "guidance" from the
Therefore, even if HUD's premise that the Administration policy applies to the MHCC is correct - which MHARR disputes and does not accept - the policy does not extend to non-lobbyist employees of MHARR and MHI.
3. HUD Has Undermined the
A key mission of the MHCC, as stated in the 2000 law, is to provide HUD with "periodic" recommendations to "adopt, revise and interpret" both the federal construction and safety standards and the HUD program's "procedural and enforcement regulations, including ... the permissible scope of and conduct of monitoring...." (See, section 604(a)(3)(A)(i-ii). See also, section 603(20) defining the "monitoring" function).
While the MHCC has, in fact, provided HUD with such recommendations, those consensus recommendations, particularly regarding the HUD regulations and enforcement matters, have routinely been rejected by HUD. HUD, moreover, in more recent years, has refused to even bring regulatory and enforcement matters to the MHCC for consensus review and comment, leaving the MHCC's Regulatory Enforcement Subcommittee with literally no action items despite major changes to the in-plant inspection system as detailed below. It is evident that, at least in part, this action to undermine a core MHCC function is driven by HUD's unwillingness to provide the specific justification and cost-benefit analysis that is required for the MHCC process by the 2000 law. (See, section 604(e) - "The consensus committee, in recommending standards, regulations and interpretations ... shall (4) consider the probable effect of such standard on the cost of the manufactured home to the public; and (5) consider the extent to which any such standard will contribute to carrying out the purposes of this title...."). Furthermore, even MHCC recommendations to update the construction and safety standards have languished at HUD without action for years - in some cases so long that incorporated reference standards became outdated, forcing further study to update the pending MHCC recommendation. Thus, HUD resistance to the full and proper implementation of the 2000 law has stymied the work of the MHCC in attempting to keep the standards updated and enforcement practices consistent with the purposes of the law and the public interest.
The MHCC was established by
By contrast, the MHCC was designed by
HUD, however, since 2004, has maintained that the MHCC is a routine federal advisory committee and has attempted to severely limit its substantive role through baseless, highly restrictive interpretations of the law. HUD has also imposed extreme restrictions on MHCC procedures, based on the Federal Advisory Committees Act (FACA). As is explained in greater detail in section 4, below, however, even if HUD is correct in maintaining that the MHCC is a FACA committee, FACA, by its express terms, can be - and in this case is - superseded by the more specific provisions of the 2000 law.
Through these two related actions, HUD regulators have effectively excluded from MHCC consensus review and comment the vast majority of program decisions concerning enforcement, inspections and monitoring which substantially impact the cost and affordability of manufactured housing for consumers - contrary to the intent of the 2000 law. Not surprisingly, then, for at least the past three years, HUD has failed to bring any change in the regulations or enforcement practices to the MHCC under section 604(b) of the 2000 law, even though such changes, including a fundamental change in the focus and character of in-plant regulation (see, section II-4, below) have been implemented.
HUD claims, in support of these actions, that "as a private advisory body not composed of federal employees, the MHCC does not have HUD's responsibilities for public safety and consumer protection." Thus, according to HUD, "the Department must ... remain free of the MHCC process to make program decisions that would not be considered rules under the Administrative Procedure Act." While HUD is correct that the MHCC does not have HUD's statutory "responsibilities" (such as the "responsibility" under section 620(a)(1)(C) to appoint a non-career program administrator), this issue was addressed fully during the legislative process leading to the 2000 law, and is precisely why the MHCC issues recommendations that do not gain the force of law unless they are approved by the Secretary and promulgated through notice and comment rulemaking.
Since the power of the MHCC is statutorily limited to recommendations only, the law is very broad in identifying the types of HUD actions that must be brought to the MHCC for review and comment. In addition to standards, enforcement regulations and interpretations of both, as addressed by sections 604(a) and 604(b) respectively, the "catchall" section of the Act, 604(b)(6), was designed to ensure that virtually all quasi-legislative actions of the Department as contrasted with quasi-judicial enforcement activities -- whether characterized as a "rule" or not, to establish or change existing standards, regulations and inspection, monitoring and enforcement policies or practices, would be subject to review, consideration and comment, prior to implementation, by the MHCC. (See. Attachment G at p. 6). This section, which deems any such action "void" without prior MHCC review, was included in the law as a remedy for past abuses where major changes to enforcement procedures and the construction of the standards were developed behind closed doors and implemented without rulemaking or other safeguards.
The law, accordingly, addresses HUD's point by limiting the power of the MHCC to recommendations, not by severely limiting the actions subject to MHCC review as HUD claims. To construe section 604(b)(6) to apply only to formal rules makes no sense, because such rules are, by definition, subject to rulemaking and public comment anyway. Instead, section 604(b)(6) was intended to ensure an opportunity for MHCC consensus comment and recommendations on a wide range of program actions that would not otherwise be subject to public review or comment.
HUD, therefore, has misconstrued the law and should be compelled by
4. HUD Has Undermined the Independence of the MHCC
In addition to emasculating the substantive role of the MHCC through unsupported unilateral interpretations of the 2000 law, HUD has also sought to undermine the independence of the MHCC, characterizing it as a run-of-the-mill federal advisory committee and subjecting it to an extremely narrow interpretation and application of the Federal Advisory Committees Act, in an effort to transform the MHCC into a meaningless rubber stamp, akin to the defunct
Nothing in FACA, however, requires or even supports such a HUD takeover of the MHCC. (1) FACA provides no authority for HUD to dictate the content and substance of MHCC meeting agendas. While FACA authorizes the Designated Federal Officer (DFO) for any committee to "approve" meeting agendas, the bylaws of other FACA advisory committees routinely allow for the content of such committees to be set by the committee chairman, and expressly allow for committee members and even members of the public to place issues on the agenda. (2) FACA provides no authority to restrict public participation in MHCC meetings to an extremely limited period of time. To the contrary, section 604(a)(3)((A)(iii) of the 2000 law requires the MHCC to "carry out its business in a manner that guarantees a fair opportunity ... for public participation." (3) Nothing in FACA authorizes HUD to control which issues are prioritized for review. (4) Nothing in FACA addresses agency veto power over subcommittee composition. (5) Nothing in FACA authorizes the agency to control subcommittee assignments or (6) chairmanships. And (7), the 2000 law itself clearly provides that the function of the MHCC is not just to consider and comment on HUD proposed standards and regulations, but to consider and comment on HUD interpretations (604(b)), to develop and submit its own recommended standards (604(a)), regulations (604(b)) and interpretations (604(b)), as well as to consider and comment on the entire range of HUD actions covered by section 604(b)(6).
FACA, moreover, states that its "provisions ... apply to each advisory committee except to the extent that any Act of
Very clearly, if
5. HUD Has Not Implemented Enhanced Federal Preemption
Federal preemption, in order to prevent states and localities from imposing a multitude of divergent mandates on manufactured housing which would undermine its fundamental affordability is a crucial element of the federal program. From the very inception of federal regulation in 1976, however, HUD has taken a narrow and extremely constrained approach to federal preemption. That approach was confirmed by a
In the 2000 law, however,
HUD claims, as asserted in a
HUD states in its
The 2000 law expanded preemption three ways. It told HUD to apply preemption "broadly and liberally;" it extended preemption to state or local "requirements" that are not necessarily standards; and it expanded the basis for preemption to include interference with the comprehensive federal "superintendence" of the industry. As a result, the touchstone of federal preemption is no longer limited to the extremely narrow, "same aspect of performance" test that HUD routinely used as an excuse not to enforce preemption under the 1974 law. HUD, however, has given no indication that it is prepared to implement preemption as expanded by the 2000 law, or, indeed, that it even understands the nature and impact of that expansion. Thus it is not surprising that the Department, 12 years later, has not retracted outdated and highly restrictive internal guidance regarding federal preemption, issued before the 2000 reform law (see. Attachment N, HUD "Notice of Staff Guidance," 62
6. HUD's Regulatory Expansion Violates Sections of the Law
While the original 1974 federal manufactured housing law included specific procedural and substantive requirements for the development and adoption of federal manufactured housing construction and safety standards, it contained no parallel requirements for the development of enforcement-related regulations.
HUD has maintained, as "a fundamental tenet of administrative law that the agency that promulgates a rule may interpret that rule as necessary for enforcement purposes." It then claims that nothing in the 2000 law "suggests that HUD must suspend enforcement of its standards or regulations" while the MHCC considers proposed interpretations. Effectively, then HUD argues that it can enforce a new interpretation of the standards prior to any review or comment on that new interpretation by the MHCC.
Whether and to what extent this is a "fundamental tenet" of administrative law is irrelevant, because while under section 604(b)(2) of the 2000 law, "the Secretary may issue interpretative bulletins to clarify the meaning of any standard ... or procedural and enforcement regulation," the Secretary under section 604(b)(3) of the law, "before issuing" any such interpretation, must "provide the consensus committee with a period of 120 days to submit written comments." Obviously, if the MHCC must be provided with an opportunity to review or comment on an interpretation "before" it is "issued," no such interpretation may be enforced by HUD prior to such review.
HUD further states that "If the MHCC disagrees with an enforcement decision made by HUD, then the MHCC may propose its own interpretation ... for the Secretary's consideration." As HUD is aware, however, any such action by the MHCC would be difficult or impossible, now that HUD program regulators have assumed control over the subjects that can come before or be considered by the MHCC. (See, section II-4, above).
Moreover, as noted above, section 604(b)(6), by its express terms, provides that any change by HUD to policies, practices, or procedures relating to the standards, inspections, monitoring, or other enforcement activities, must be brought to the MHCC, or are otherwise deemed "void" by the law. Clearly, if HUD began to enforce such a change that had not been brought to the MHCC beforehand, the change underlying that enforcement would be void, as would be the enforcement action itself.
To more clearly illustrate the deficiencies of HUD's position, the following is an example of a major change to the enforcement process that has not been brought to the MHCC as it should have under section 604(b), and has caused significant hardship for the industry.
In recent years, both HUD and its monitoring contractor have been pressuring manufacturers to implement costly changes to their in-plant inspection procedures based on "enhanced" checklists that go beyond the requirements of the current standards and a "Standard Operating Procedure" developed behind closed doors by program regulators. None of these de facto standards have gone to the MHCC, even though they make major changes to HUD policy and practice regarding inspections and monitoring. None have had a cost-benefit analysis, and none have been shown to produce any benefits for consumers to offset their increased cost. Moreover, related proposed changes to the regulations to support this activity did gain consensus approval by the MHCC specifically because HUD failed to provide cost data or justification for the changes to the MHCC, as required by the 2000 law, and have not been published as a proposed rule.
This expansion of in-plant regulation, designed by HUD to change the entire focus of the in-plant inspection system from inspection of the home itself for compliance with the federal standards to prescriptive criteria and inspection of the manufacturer's "quality assurance system" (see, Attachment O,
Whether or not these changes to in-plant enforcement policies and practices constitute a formal "rule" as defined by the APA is - and should be - irrelevant. The fact is that they constitute a disruptive change in enforcement policies and procedures that results in increased costs for both producers and homebuyers. As a result, under the express terms of section 604(b)(6), as written by
7. HUD Has Used the Same Monitoring Contractor for 35
The HUD manufactured housing program has had the same monitoring contractor (i.e., the same continuing entity, with the same personnel, albeit under different names - initially the "
Without new ideas and thinking the program, effectively, remains frozen in the 1970's and has not evolved along with the industry. This is one of the primary reasons that the federal program, government at all levels and other organizations and entities continue to view and treat manufactured homes as "trailers," causing untold difficulties for the industry and consumers, including financing, zoning, placement and other issues. The 2000 law, moreover, was designed to assure a balance between reasonable consumer protection and affordability. But the HUD program and the entrenched incumbent contractor have a history of continually ratcheting-up regulation, with more detailed, intricate and costly procedures, inspections, record-keeping, reports and red-tape, despite the fact that consumer complaints regarding manufactured homes, as shown by HUD's own data, are minimal. This is a result, in part, of an enforcement and contracting structure that provides an incentive for the monitoring contractor to find fault with manufactured homes.
For the manufactured housing industry to recover and advance from the decline of the past 13 years, this cycle must be broken and the federal program must be brought into full compliance with the objectives and purposes of the 2000 law. It is thus essential that the program ensure that there is full and open competition for the monitoring contract when the next solicitation occurs later this year, with new award criteria that do not penalize or ward off new bidders without direct program experience and a structure that does not provide a financial incentive for excessive or punitive regulation.
8. HUD Has Wrongly Re-Codified New 2000 Law Programs
HUD, citing the legislative history of the 2000 reform law, claims that the law "specifically guarantees that the federal installation standards will not preempt state installation standards." The Department thus contends that its codification of the federal installation standards authorized and required by the 2000 law outside of the preemptive Part 3280 construction and safety standards, is correct and consistent with the law. This is an accurate statement as far as it goes, but again, it represents a serious misreading of the clear language of the law.
The 2000 reform law is based largely on the 1994 recommendations of the congressionally-chartered
And that, in fact, is how the 2000 law is structured. Section 605 requires the development and enforcement of minimum federal installation standards subject to an express reservation to each "state," in section 604, to develop and enforce equal or higher installation standards pursuant to approval by HUD. It is important however, to compare the preemption language of the 2000 law to this reservation, which directly follows it. Under the 2000 law, federal standards preempt non-identical "state or local" standards or requirements. The reservation that follows it, however, is limited to the "states."
Viewed in the context of the
HUD's position by contrast, will leave the industry and its consumers subject to a patchwork of differing local standards that at best will unnecessarily increase the cost of manufactured housing and, at worst, could be used to discriminate against or even exclude manufactured housing from communities around the country, contrary to the law.
The re-codification of dispute resolution similarly leaves that entire subject area outside of the review and update authority of the MHCC, which is statutorily defined as addressing matters relating to the Part 3280 manufactured housing construction and safety standards and the Part 3282 Procedural and Enforcement Regulations. HUD has maintained that it resolved this issue by including a provision in the final dispute resolution rule that provides for continuing consultation with the MHCC on this issue. A regulatory provision, however, may be easily revoked or amended and is no substitute for the statutory authority that the MHCC would have over this critical subject if it had been properly codified as part of the Procedural and Enforcement Regulations. This is particularly true given HUD's recent efforts to limit the role, authority, independence and functionality of the MHCC, as detailed above.
9. Misdirected HUD Program Budgets Need to Be Scrutinized and Subject to Accountability
The financial aspects of the HUD manufactured housing program, including budgets, revenues, expenditures and appropriations, particularly since 2009, have spiraled out of control, leading to mismanagement of the federal program and the misallocation of its resources in ways that have diverted it from its main objective and mission under the 2000 law - protecting homebuyers while maintaining the affordability of manufactured homes as "housing."
Of the seven specific program "responsibilities" to be funded by the Secretary under the 2000 law (see, section 620(a)(l)(A-G)), HUD has used misdirected program budgets to primarily focus on just two - (1) expanding "inspections and monitoring" by creating new, unnecessary, unnecessarily complex and unnecessarily costly "make-work" inspection requirements that have been used to sustain and increase payments to the entrenched program monitoring contractor , even as industry production has significantly declined; and (2) substantially increasing program staff, despite the pronounced industry downturn of the past decade-plus. At the same time, HUD has refused to fund and appointed non-career program administrator, as required by section 620 (a)(1)(C) of the 2000 law, and is denying its state partners - the State Administrative Agencies (SAAs) - badly needed revenue, even though those agencies, unlike the monitoring contractor, are the first line of protection of a steadily growing number of consumers living in both new and existing homes.
HUD regulators have been able to advance this highly skewed agenda because of an artificially inflated program budget that has grown even as industry production has declined, without effective oversight by
Accordingly, as part of this oversight process and as part of the FY 2013 (and subsequent) appropriations process,
10. HUD's Failure to Fully and Properly Implement the 2000 Law Has Negatively Impacted Consumer Financing
While HUD has claimed that the long-term scarcity of manufactured home financing is attributable to the performance of manufactured homes, asserting, among other things, that improvements to producers' "quality control" would "attract lenders back to manufactured housing (see. Attachment C, supra), the reality is that HUD itself, by failing to fully and properly implement the 2000 law and failing to ensure the status of manufactured homes as legitimate housing for all purposes, has placed the industry and its consumers in a no-win position, where modern manufactured homes, despite state-of-the-art construction and high quality are perceived, treated and penalized as "trailers" for purposes of financing and a host of other matters.
Similarly, given HUD's failure to fully and properly implement the 2000 law in accordance with its fundamental transformative purposes, the GSEs -
The scarcity of manufactured home financing, therefore, is not a product of insufficient HUD regulation. It is a product of a HUD regulatory program that continues to treat manufactured homes as "trailers" and continues to relegate manufactured housing to second-class status, even though
Consequently, in order to create an environment where manufactured home purchase financing can be restored and extended to consumers - and particularly lower and moderate-income families - who seek a home that they can truly afford without government subsidies, it is essential that HUD be compelled by
Based on all of the foregoing information,
Read this original document at: http://financialservices.house.gov/UploadedFiles/HHRG-112-BA-WState-DRoberts-20120201.pdf
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