Washington, D.C., February 21, 2017 – The Manufactured Housing Association for Regulatory Reform (MHARR) has filed written comments (see, copy attached) on a December 16, 2016 rule proposed by the U.S. Department of Housing and Urban Development (HUD) to modify minimum payments provided to State Administrative Agencies (SAA) within the HUD manufactured housing program.
As an integral part of the unique federal-state partnership established by the National Manufactured Housing Construction and Safety Standards Act of 1974 -- as amended by the Manufactured Housing Improvement Act of 2000 -- SAAs are the first line of protection for consumers residing in manufactured homes subject to federal standards established by HUD. This includes not only new and recently-installed homes, but also existing homes constructed under federal standards dating back to 1976. SAAs are thus responsible for an ever-growing number of homes in each SAA state.
Unfortunately, in recent years, however, SAAs (operating under an outdated 15-year-old funding rule) have been starved for funding by the HUD program, while budgeted payments to revenue-driven program contractors – paid, among other things, to seek out and pursue complaints at a time when consumer complaint levels are minimal -- have ballooned, despite significantly reduced production levels of new homes over the same period.
This fundamental distortion of the federal program – in direct conflict with the federal-state partnership mandated by Congress and the letter of the 2000 law – would have been made far worse by a modification to the SAA payment rule proffered by the current career Administrator of the HUD program in July 2015, which would have severely reduced funding for many of the 37 SAAs, and led a significant number to consider exiting the HUD program. Fortunately, though, following strenuous objections by MHARR and various states, the Administrator was forced to reverse course. HUD, thereupon, developed an alternative funding proposal, consistent with the 2000 law, which was approved by the statutory Manufactured Housing Consensus Committee (MHCC) in 2016 and is now incorporated within the December 16, 2016 proposed rule.
As indicated by its written comments, MHARR now supports this alternative proposed rule, and has urged its adoption as a final regulation.
That said, the initial abortive attempt by the program Administrator to cut SAA funding levels, contrary to the law, and the ensuing delay in addressing this long over-due funding adjustment and payment increase for most states, are just the latest examples of a mismanaged program that, among other things, abuses fee revenues paid by regulated manufacturers. At a time when those manufacturers are producing their best homes ever – as demonstrated by minimal dispute resolution program referrals -- the program continues to lavish funding on entrenched contractors for make-work activity that needlessly increases home prices while providing few or no benefits for consumers. MHARR, therefore – and particularly with a new Administration in office that has pledged to roll-back wasteful, unnecessary and destructive regulation – has begun to evaluate and advance tighter controls on such expenditures, including, but not limited to, possible cutbacks in funds appropriated for the program.