December 21, 2010 Regulations Division, Office of General Counsel Dept. of Housing and Urban Development 451 7th Street, SW, Room 10276 Washington DC 20410‐0500 Re: Docket No. FR‐5246‐P‐02, RIN 2506‐AC 30, Housing Trust Fund CFED appreciates that language specifically including manufactured housing is included in the October 29, 2010 proposed rule regarding the Housing Trust Fund. Since 2005, CFED has led a network and managed a national initiative, Innovations in Manufactured Homes (I’M HOME), which seeks to ensure that all homeowners, regardless if their home is site‐built or manufactured, enjoy the same rights and privileges of homeownership. I’M HOME also promotes manufactured housing as an affordable and high‐quality homeownership option. Today, more than 17 million Americans live in manufactured housing. As the largest single source of unsubsidized affordable homeownership in the country, it is the de facto source of affordable housing in many of the nationʹs most persistent poverty regions and high‐cost housing markets. In one recent study, more than two‐thirds of all new housing constructed over a three‐year period that was affordable to low‐income families was manufactured. Still, manufactured homes are frequently misunderstood and overlooked due to outdated stereotypes of “trailers” and “mobile homes”, even though manufactured housing that is well built and maintained can be attractive, grow in value and open the door to homeownership to millions more families. In reviewing the proposed language related to manufactured housing, §92.744, we have some questions and suggestions for improvement. We also make changes to additional areas that could affect manufactured homeowners. Current language: 24 CFR part 92 Section 730(a)(4) HTF funds may be used to purchase and/or rehabilitate a manufactured housing unit, or purchase the land upon which a manufactured housing unit is located. The manufactured housing unit must, at the time of project completion, be connected to permanent utility hook‐ups and be located on land that is owned by the manufactured housing unit owner or land for which the manufactured housing owner has a lease for a period at least equal to the applicable period of affordability. Our concerns are as follows: 1. This language seems to restrict manufactured homes as only used by home buyers, not renters. We would not wish for manufactured homes to be prohibited to receive Trust Fund dollars for rental purposes. 2. Access for resident‐owned cooperatives and non‐profits must be made more explicit. 3. The timing of the home placement and land ownership needs to be flexibile. The opening sentence says “or to purchase the land”, the next sentence reads, The home must, at the time of project completion be…located on land that is owned by the home owner, or land for which the home owner has a lease for a period of at least equal to the affordability period.” We recommend the following [preferred language] (in bold and within brackets) which we believe addresses these concerns: § 24 CFR part 92 Section 730(a)(4) HTF funds may be used to purchase and/or rehabilitate a manufactured housing unit, purchase the land upon which a manufactured housing unit[(s)] is [(are)] located[, remove and decommission a substandard unit, finance the purchase of land for creating a community, or provide needed infrastructure improvements for a community]. The manufactured housing unit must, at the time of project completion, be connected to permanent utility hook‐ups. [Permanent foundations are not required. It must be] and be located on land that is owned by the manufactured housing unit owner or land for which the manufactured housing owner has a lease for a period at least equal to the applicable period of affordability. [A homeowner shall be considered to have satisfied this requirement if the homeowner has a long‐term lease from a community land trust or nonprofit housing corporation or a long‐term or proprietary lease (perpetual or renewable as a matter of right) by a membership not‐for‐profit, limited equity cooperative or homeowner association that is owned or controlled by the homeowners living in the manufactured home community.] [Trust fund dollars may be used to convert manufactured housing communities to resident ownership where at least 51% of the rental sites are occupied by homes owned or rented by qualified homeowners, or to the extent that a percentage of the homes are owned by qualified home owners.] The rules should explicitly note that [manufactured home communities that rent sites to homeowners are rental property and that lending on acquisition or rehab of the home is homeownership.] § 92.731(f) Eligible Project Costs: Relocation We recommend that eligible relocation costs include one‐for‐one replacement such that grantees may use HTF money to replace low‐income manufactured homes in communities when demolished or converted for another use. Manufactured home communities come under threat of closure when community owners sell, foreclose or convert their properties to a different use. Community closures destroy a homeowner’s ability to build equity and make conventional financing even more difficult to obtain; the lack of long‐term security in manufactured home communities makes lenders reluctant to originate loans for manufactured housing. Homeowners are often removed from the land without adequate compensation or regard concerning relocation with few avenues for recourse. Manufactured housing community closures diminish the availability of unsubsidized affordable housing and lead to even more costs to local governments in the form of housing subsidies, increased homelessness and other social service outlays. § 92.741 Energy Efficiency While requiring new homes to meet ENERGY STAR criteria makes complete sense, this should not be an absolute criterion when HTF money is being used to purchase a manufactured housing community. When HTF money is used to preserve manufactured housing communities then existing homes should be allowed to remain even if they are do not meet ENERGY STAR criteria. In the manufactured housing community context, the homeowner is responsible for the cost of utilities and therefore this cost is not coming out of HTF budget. Perhaps the compromise could be that when current home owners move from the community then only ENERGY STAR homes are brought in to replace pre‐1976 HUD code homes as they become available. §92.747 Tenant protections and selection We recommend that tenant protections explicitly require a right to organize or associate. Approximately one‐third of manufactured homes are sited in land‐
lease communities (or “parks”) where the homeowner rents the land, which can threaten their long‐term security. While manufactured homes represent a pathway to affordable homeownership for millions of Americans, the ability of homeowners living in land‐lease communities to build wealth through homeownership remains tenuous if certain fundamental freedoms are not protected—they have freedom to speak, must be free to meet, to go door‐to‐door within the community, to form homeowner associations and to advocate for policies that support stronger protections and promote resident ownership—
without fearing retaliation such as rental fee increases or lack of services or eviction for exercising these rights. §92.748 Qualification as affordable housing: Homeownership We are pleased to see that Section 92.2 is incorporated to allow displaced homemakers and single parents. We concur that eligible first‐time homebuyers are those who have not had a sole ownership of a residence. Homeowners who owned homes jointly should be able to receive assistance as a single person. §92.749 Qualification as affordable housing: Modest housing requirements for homeownership Owners or renters of single‐ or multi‐section manufactured homes qualify for assistance as long as other eligibility criteria are met. Sincerely, Carol E. Wayman
Carol E. Wayman Director of Federal Policy