November 17, 2000
Re: Title VI, "Manufactured Housing Improvement" Section of S.1452, "The American Homeownership and Economic Opportunity Act of 2000"
Dear Senator:
The February 1998 Consumer Reports magazine published the results of a two-year examination of the manufactured home industry. Among other findings, the article noted that a majority of homeowners reported they had at least one major problem with their manufactured home. Problems with installation represented more than half of the complaints reported by consumers; lower cost manufactured homes have lower-quality materials; like plastic plumbing fixtures and metal roofs that wear out quickly or are easily damaged; and warranties may exclude protection against problems that occurred in transit or because of faulty installation, leaving consumers no recourse when a problem arises.
The Senate may soon take up the manufactured housing section, Title VI of S. 1452, "The American Homeownership and Economic Opportunity Act of 2000," passed by the House several days ago. We do not feel this legislation adequately addresses the concerns about manufactured housing highlighted in the Consumer Reports article. We wish to call to your attention to the following provisions:
| 1. | This bill places governmental authority in the hands of a non-governmental entity, the "consensus |
| committee," and reduces consumer protection by placing restrictions (including financial) on the | |
| ability of Department of Housing and Development (HUD) and states to take timely action on | |
| enforcement matters. The version of this legislation, H.R. 1776, passed by the House deleted | |
| this role for the consensus committee (Sections 602, 603, and 604). | |
| 2. | Without benefit of a public hearing on this matter, this bill significantly expands federal |
| preemptive authority over state and local laws regarding the siting and installation of | |
| manufactured housing, dispute resolution and zoning standards relative to compatibility of | |
| manufactured homes with other types of housing sited in a community | |
| (Section 604, 605 & 610). | |
| 3. | The bill diminishes the role of the states from full partner with HUD in this program to |
| subcontractor by: | |
| a. Eliminating state control over label fees collected from consumers and manufacturers for | |
| monitoring and consumer complaint handling functions, and subjects those funds to annual | |
| congressional appropriations for the first time in the program's 25 year history. | |
October 26, 2000
Page 2
| Changing the system from a state-funded fee-for-service program (similar to most state building regulatory systems) to an annual Federal appropriation system could leave states and consumers with no oversight activity when congressional budget battles delay appropriations past the end of the Federal fiscal year. (Section 609 which amends Section 620 of the existing act). | |
| b. Title VI places restrictions on current monitoring and oversight practices of the states and third | |
| party agencies, including the inspection of homes for transportation damage on dealer lots | |
| (Section 603, definitions of monitoring). | |
| c. Title VI potentially fragments the monitoring and oversight systems which could make it | |
| impossible both for many states to continue to participate on monitoring teams and for effective | |
| enforcement action to be taken in the program based upon cohesive uniform monitoring data | |
| which will withstand legal challenges by industry (Sections 605, 609, and 610). | |
| d. Title VI takes away from both states and consumers a major source of reliable public | |
| information about the Federal program by eliminating the mandate for HUD to issue to | |
| Congress a bi-annual report on the effectiveness of the Federal Manufactured Housing | |
| Construction and Safety Standards Program (Section 611). | |
As passed by the U.S. House of Representatives on October 24, 2000, we fear that Title VI of S. 1452 in the areas outlined above represents a step backwards not only from the existing Federal Manufactured Housing Construction and Safety Standards Act, but from H.R. 1776, Title XI, that passed the House this past spring.
We understand that state building regulatory officials have also expressed concerns about some of these provisions. If Title VI, the "Manufactured Housing Improvement" section of S.1452 comes before you, we ask that you support these important changes that will enhance, not diminish, protection for consumers who purchase manufactured housing. We believe that this legislation needs more extensive consumer and state input before being adopted into law.
Thank you for your time and attention to these concerns.
Sincerely,
Sally Greenberg
Sally Greenberg
Senior Product Safety Counsel