From the 83rd: The Opening Moves

We are less than three weeks away from TMHA’s Capitol Visit Day on March 5th and we’re more than a month into the 2013 Texas Legislative Session. 

And what a session it is turning out to be thus far.

We’ve been publishing many general articles and posting numerous stories of interest regarding the comings and goings of this unique session.  However, this post is different.  In the this post I’m not going to address things like water and road infrastructure, using the state’s Rainy Day Fund or talk about school choice in public education.

No, this post is specifically about our world – our manufactured and modular housing world.

THMA is currently working on multiple bills, some of which have already been filed (HB 578) and others are on their way.  We have an aggressive legislative agenda and we need some good “home cooking” to help us get it through.  We need your grassroots and your direct participation in the process.  And we will take it at all levels from joining us at the Capitol the first week in March, to making phone calls, sending emails, releasing carrier pigeons and sending smoke signals.  We take, welcome and encourage it all.  If we want to collectively achieve our ambitious legislative agenda this session we need all of our members.

Let’s start with what we know right now 

Even this early into session there are already four bills specifically addressing manufactured housing, communities or modular housing issues.  They are as follows:

HB 578 – by Chairman Guillen: Relating to the regulation of modular housing. 
This bill seeks to establish a bright-line timeline of state regulatory authority over modular housing in our state.  This is a bill TMHA fully supports and asks our members to help us advance it through the legislature. 

For years the regulatory environment for modular housing has been far from ideal.  Many of our modular home manufacturers and builders have suffered, lost business, and needlessly spent tens of thousands of dollars.  This ends this session.

HB 944 – by Rep. Riddle: Relating to an exemption from license requirements for a limited number of sales of manufactured housing. 
This bill was sponsored by Rep. Riddle after a constituent in her district who owns a small manufactured home community requested her to increase the de minimis exclusion for obtaining a retailers’ license from the current two or more sales in a 12-month period to five homes in a 12-month period.

HB 610 – Rep. Larson: Relating to an exemption from license requirements for the sale of certain manufactured housing. 
This bill was also a constituent driven bill brought to Rep. Larson by an owner of a small manufactured home community who wants to sell his community in its entirety.  However, the constituent wants to sell the land (real property) and a few manufactured homes (personal property) he owns in two separate, but connected business transactions. 

The current law requires the owner to obtain a retailer’s license if he sells more than one manufactured home in a year.  This bill would provide a limited exclusion to the retailers’ licensing requirement if manufactured homes are sold in connection with the sale of a manufactured home community.  The bill would be limited to only two community related sales transactions in a year.

SB 499 – Sen. Lucio: Relating to the determination of actual damages to enable compensation from the manufactured homeowners' recovery trust fund. 
This bill was brought to Sen. Lucio by the various consumer advocate organizations in response to the highly publicized “Park Girl” incident in south Texas (more on this later). 

The bill, as originally drafted, makes a simple change relating to a consumer obtaining access to the Homeowners Recovery Trust Fund (“HORF”).  Currently the law requires a jury trial before certain funds are eligible.  This bill would allow either a jury or bench (judge only) trial.

What TMHA is working on

TMHA anticipates in the coming days and weeks that bills will surface on both the House and Senate side advocating for the improvement of the manufactured and modular housing industries in the following ways:

First, a bill to engage the legislature in deciding if the state regulatory entity over modular residential homes should remain with the Texas Department of Licensing and Regulations (TDLR), or if there is a more suitable and efficient agency where this program should be housed in the future.

Second, a bill to expand and increase the flexibility of the HORF at the Manufactured Housing Division of TDHCA to allow the fund to not only provide consumer remedy for non-bond reimbursed license holder transgressions, but to also provide some prospective manufactured home consumers improved access to manufactured homes.  This bill is currently being shaped as it undergoes the rigors of political debate.  The outcome of this debate with determine the increased flexibility of use, access and possibly additional allocation of funds to increase the HORF’s capabilities.

Third, a bill to create a process of verifying if a tax lien suit has been filed on delinquent, properly filed tax liens on manufactured homes with tax liens older than the four year statute of limitations.  If no tax suit has been filed, then the bill would allow THDCA to remove from the home’s statement of ownership and location any tax liens where no collection suit has been filed that are older than four years.

What others are working on

TMHA is aware of advocacy efforts at the Capitol by consumer advocacy groups in their attempt to obtain legislative solutions to what they argue are the following problems in the manufactured housing and community industries.

First, they are pushing for a bill to require an upfront disclosure prior to any sale of a manufactured home disclosing the “fast depreciation” of manufactured housing by providing the estimated value of the home two years into the future after the prospective buyer purchases the house.

Second, they want escrow accounts set up in manufactured home communities that would be funded to provide tenants who are evicted from the community a source of funds to relocate their manufactured home.

Third, they want to prevent “rent to own” transactions.  However, such transactions in Texas are already illegal because the statute requires title to transfer at the point of sale.

Fourth, prevent retailers from selling to consumers homes that have been foreclosed on by a mortgage company, but the retailer does not have legal ownership rights to the home.  However, such transactions are already illegal under Texas law, which requires retailers to provide, “good and marketable title, free and clear of all liens.”

Fifth, prevent lenders and/or retailers from assessing any previously accrued tax liability on a home into the sales price of the homes to future buyers.

Finally, sixth, increase the requirement for a retailer’s bond amount and allocate more state general revenue into the HORF to make more money available for reimbursement of consumer victims of deceptive or illegal manufactured home sales.

Other tangentially related issues

There are also bills filed ranging from specific county housing regulatory authority (currently bracketed to site-built subdivision in boarder counties to combat “colonias” type living conditions), to bills ranging in nearly all aspects of the Eagle Ford natural gas industry, to landlord tenant bills and more.

TMHA Organized Grassroots

I encourage all TMHA members to join with us in the first week of March to personally address our legislators on our industry.  For those who can’t make it, a phone call, email or letters are also terrific ways to let your legislators know our issues for this session.

Just by way of an example of our potential direct constituent grassroots advocacy power I share with you the following:

Number of TMHA members who are constituents of one of the members on the House Licensing and Administrative Committee where a mass majority of all manufactured and modular home bills are first heard: 44

This committee has nine House members.  With 44 TMHA members who are constituents of these key nine members, it should be our collective grassroots goal that each of these nine members hears from at least four TMHA members about our issues.

Number of TMHA members who are constituents of one of the members on the Senate Business and Commerce Committee where a mass majority of all manufactured and modular home bills are first
heard: 247

This committee also has nine Senate members.  With 247 TMHA members who are constituents of these key nine members, it should be our collective grassroots goal that each of these nine members hears from at least 12 TMHA members about our issues.

With our combined efforts we generate strength, achieve success, defend ourselves and advance our industry. 

Won’t you join our cause?

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