Perhaps one of the more misunderstood issues that’s marched on for years in the manufactured housing industry is the Department of Housing and Urban Development (HUD) federal monitoring contract.
What makes it more important than most industry pros, housing advocates, or investors realize?
HUD doesn’t directly monitor manufactured housing production compliance themselves. They do that via a contracted third-party. That third-party has reportedly been Institute for Building Technology and Safety (IBTS) for over 4 decades.
The Manufactured Housing Association for Regulatory Reform (MHARR) exclusively told MHProNews in response to a follow up question from us today about their statement below that “The structure of the [HUD Monitoring] contract itself involves pseudo-regulatory functions and incentives for finding fault with manufacturers in particular, that should not exist given the limited definition of the monitoring function adopted by Congress in the Manufactured Housing Improvement Act of 2000.”
With that pertinent backdrop, the notice provided today by MHARR to the Daily Business News on MHProNews of their communique to HUD’s Acting Deputy Secretary Brian Montgomery takes on a clarity that should make industry professionals sit up and take notice on several levels.
Among the questions this should raise? Is MHI taking a similar stance? If not, why not?
These costs are ultimately born by consumers. How aware are resident or other consumer groups of the implications of this issue?
It should go without saying that manufactured home producers have every incentive to make sure that their homes comply and are as occupancy-ready as possible. The least expensive place to correct an issue is while a home is still in a factory.
Thus, every HUD Code manufactured home plant has its own internal inspectors, besides the routine inspections conducted by HUD’s third-party monitoring contractor.
Here below is the entire letter from MHARR to the HUD’s Brian Montgomery, who previously served at HUD during the Bush Administration.
April 1, 2019
VIA FEDERAL EXPRESS
Hon. Brian Montgomery
Acting Deputy Secretary
Assistant Secretary for Housing-Federal Housing Commissioner
U.S. Department of Housing and Urban Development
451 Seventh Street, S.W.
Washington, D.C. 20410
Re: HUD Manufactured Housing Monitoring Contract Solicitations
Dear Secretary Montgomery:
As you know, the Manufactured Housing Association for Regulatory Reform (MHARR) has been a constant and vociferous proponent of full and fair competition for the federal manufactured housing program monitoring contract as specifically mandated by Congress in the Manufactured Housing Improvement Act of 2000, and as provided generally by federal law. Strict compliance with the open competition requirements of federal law – as we have stressed repeatedly — is particularly essential in the case of the manufactured housing monitoring contract, given the de facto regulatory power of the monitoring contractor and the fact that the incumbent contractor, the Institute for Building Technology and Safety (IBTS), has held that contract continuously since the inception of the federal manufactured housing program, more than 40-years ago.
When we met with you late in 2018 and when we met several weeks ago with HUD’s Acting Chief Procurement Officer, Mr. Jimmy Scott, we stressed that among the essential elements needed to ensure full and fair competition for the monitoring contract – which has been absent from past solicitations – is a reasonable bid response timeframe, given both the complexity of the responsibilities inherent in the production and design monitoring contracts, and the very fact that no party, other than the incumbent contractor, has ever performed the monitoring function. Indeed, we clearly stated that a needlessly short and truncated bid response timeframe, in-and-of-itself, constitutes a baseless and unwarranted bidding advantage for the incumbent, which can, has, and will discourage other potential bidders and thus undermine the full and fair competition mandated by law.
Consequently, we were appalled and disappointed to see that the monitoring contract solicitations published by HUD on March 25 (production surveillance) and March 29, 2019 (design approval) each carry a bid response date of April 24, 2019, now less than three weeks away. Such a short response period for these contracts – particularly in light of the substantial costs of bid preparation for a non-incumbent offeror – will again discourage or even prevent full and fair competition as required by law and prevent the program from receiving the benefit of fresh ideas and new thinking that would accompany a new contractor after 40-plus years of stasis.
Based on all of this, MHARR asks that you exercise your authority to require an extension of the bid response dates for both monitoring contract solicitations for at least an additional thirty days beyond the currently-posted response date of April 24, 2019, in order to allow non-incumbent bidders a reasonable opportunity to prepare and submit responsive bids.
We thank you in advance for your consideration.
President and CEO
cc: Hon. Mick Mulvaney (OMB)
Mr. Jimmy Scott (HUD)
HUD Code Industry Manufacturers, Communities and Retailers
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Submitted by Soheyla Kovach to the Daily Business News for MHProNews.com.
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