As longtime industry members may recall, Marty Lavin is a manufactured home industry success story. His career included manufactured home finance, communities, retail and more that was honored with one of the Manufactured Housing Institute’s (MHI) highest awards during a time when their awards were arguably less political.
“My friend and longtime partner and big RE investor. One of the smartest men I know. He scares me.” So said Lavin in an email to MHProNews.
Lavin’s friend said this in his message: “Marty, The depth of the economic disaster that is coming has not been seen in our lifetime. Hopefully the banks will cooperate with the loan disaster which is guaranteed...”
As readers digest the severity of that, there are other voices that have said similarly, often with manufactured and modular housing industry specific comments.
One example is from a longtime manufactured home industry member who has ties to one of the big three Manufactured Housing Institute (MHI) member producers. He said this: “I believe there will be some-lag time involved, but I foresee some order and production declines down the road as a result of the more extreme financial impact to the majority segment of MH buyers. This would then affect MH line workers.”
We have written evidence from a well-placed source that indicates there will be an attempt made by allies of the Omaha-Knoxville-Arlington axis to target the workers of independent producers of HUD Code manufactured homes and modular builders who get shut down.
It isn’t new that in a tight job market, site builders, RV manufacturers and others routinely try to recruit manufactured housing production workers. But what is being indicated is on an order of magnitude far larger in scope. More on that, further below. But next up is the word heard from the modular builders side of the factory-built housing industry.
In a message to MHProNews, executive director Tom Hardiman said the following.
“The Modular Building Institute (MBI) and the Modular Home Builders Association (MHBA) support listing our industry as “essential” for a variety of reasons. It has become painfully obvious that our nation’s lack of investment in health care facilities has put us all at risk. The modular industry is ready, willing, and able to deliver thousands of medical facilities, testing centers, and isolation units within a matter of months. Additionally, the concern of COVID-19 spreading throughout the homeless population presents another challenge we need to address. The lack of overall affordable housing in the country only adds to the challenge. We have been talking about these issues for far too long and its time to finally address them head on. We have been in regular communication with state governors, as well as several federal agencies to emphasize that the modular industry is in fact essential. We want to help with this crisis but we need our factories to remain open. With the anticipated passage of the federal COVID Relief Bill tomorrow, billions of dollars will be allocated to various agencies to address this crisis on a number of fronts, including upgrading and enhancing our medical and housing infrastructure. MBI and MHBA members are ready to work with our public officials to overcome this crisis.”
Modular Building Institute (MBI) and
Modular Home Builders Association (MHBA)
Hardiman’s message is clear cut and bold in its support for their industry and their workers.
It is particularly important for independent producers of manufactured and modular homes to realize that their businesses are being targeted during this COVID19 crisis. When or if a plant shuts down – as has been ordered in Pennsylvania, and perhaps even before a shutdown is ordered by public officials – larger businesses or conglomerates will be seeking to attract workers away. Without a factory line crew, a factory-builder is effectively out of business.
With that backdrop, let’s now pivot to the latest from Arlington, VA based MHI.
An affiliate of MHI sent out an email around 3PM ET on 3.20.2020 that read in part as follows.
“Lesli Gooch, CEO of the Manufactured Housing Institute was invited on an emergency call with the White House about designating critical infrastructure workers during the COVID-19 emergency. The Department of Homeland Security, through its Cybersecurity and Infrastructure Security Agency (CISA), is compiling a list of “Essential Critical Infrastructure Workers.” While not fully up to speed about the parameters, she thinks it is relevant to our homebuilding facilities which is why I was invited on the call.”
State, local, tribal, and territorial governments are ultimately in charge of implementing and executing response activities in communities under their jurisdiction. The federal government is in a supporting role. As such, CISA is offering this list to assist prioritizing activities related to continuity of operations and incident response, including the appropriate movement of critical infrastructure workers within and between jurisdictions. Being on the list would help ensure your workers would have access to restricted areas through credentialing and other state/local limitations-on-movement measures.
As state and local governments shutter businesses in light of the crisis (as PA will be doing at 8:00 p.m. ET), it sounds like this is a strategy to help keep your facilities operational.”
While MHI directly – as shown above through surrogates – are posturing anew, MHProNews asked the Manufactured Housing Association for Regulatory Reform (MHARR) about that same meeting. It seems they obtained the same invitation as MHI did.
Additional research revealed that numbers of associations were given such an invitation.
Further, some small businesses were sent an email from the White House that read as follows.
You are cordially invited to participate in a conference call with the President, today, March 20, 2020 at 3:45 PM EDT. Please register via the link below. Call in information will be received upon registration.
*Please note this call is intended for Small Businesses (https://www.sba.gov/federal-contracting/contracting-guide/size-standards). Due to capacity restrictions, please limit registration to 1 line per small business.
*Please note this call will be recorded.
We look forward to speaking with you.
The White House Office of Public Liaison”
Put differently, MHI is crowing over something that untold numbers received. What is entirely lacking in their surrogates message is something that would give them a good reason to toot their own horn. Look again at a key line in how their affiliates message read.
“While not fully up to speed about the parameters, she [i.e.: Lesli Gooch] thinks it is relevant to our homebuilding facilities which is why I was invited on the call.”
That sentence speaks volumes to those who are reading both what is said and what is implied.
In the wake of the ongoing reports by MHProNews on the coronavirus/COVID19 related topics, MHI has ramped up their messaging on that front too. Here is a screen capture of their own summary of a recent email.
Additional MHProNews Analysis and Commentary
The written evidence MHProNews has is that the industry’s independents are being targeted by a firm clearly in league with Berkshire Hathaway. Tom Hodges is MHI’s chairman. Hodges is Clayton Homes General Counsel. Clayton Homes is a Berkshire Hathaway owned brand.
MHProNews has used this illustration previously, but it is time for independents to take a fresh look at this.
Kevin Clayton in the interview found in the second half of the report linked below said this: “As you’ve heard, Warren [Buffett, Chairman of Berkshire Hathaway] keeps up with almost every publicly traded company out there and all the connections and contacts he has, it didn’t take him long to size our company up.”
Among those connections and contacts that “Warren” has is Bill Gates. For almost the entire time that Berkshire has owned Clayton Homes, Gates has been on the Berkshire Hathaway board of directors. He only recently resigned, to focus more on his foundation’s ‘initiatives.’
It is entirely possible that Tom Hodges didn’t brief Gooch on all of the inside scoop that Clayton has access to through Buffett’s contacts. But either scenario – if Gooch was informed by Hodges or others at Clayton or not – is troubling, isn’t it?
Perhaps Gooch sincerely believes she is helping the industry’s independents. Perhaps we can find Santa’s workshop near the North Pole with little elves making goodies for next Christmas too. But let’s look clear-eyed at what MHI themselves have said and done.
In that message to their members, what was the top item? Their Congress and Expo. Their initial focus wasn’t how they are working to help independents.
- No word at all about how they used their “access” and “clout” to get more financing on all manufactured homes through FHFA.
- No word from MHI about how the convinced HUD’s Brian Montgomery to fully implement the Manufactured Housing Improvement Act of 2000’s enhanced preemption standard.
Instead, they touted a page of “resources” something similar to what other trade groups had previously produced for their members. MHI merely had to organize and tweak it.
The COVID19 outbreak is arguably the Buffett “Castle and Moat” strategy on steroids.
More MHI Razzle Dazzle?
What MHI has demonstrated for several years is an ability to produce seemingly slick items that look good to those who are busy or not paying close attention to the details. The Razzle Dazzle is a tactic that is used in con games, per the NCJRS.
MHI hasn’t addressed the modular home builders concerns about “CrossModTM homes.” Failing to do so could put even more manufactured home independents in jeopardy.
MHI has often not mentioned in their memos to members the growing trend toward rent control. Why should they? It is often their own member’s behavior that are being citied by public officials as the reason to implement rent control.
MHI has not warned their members that the Buffett and billionaire Michael Bloomberg supported Sierra Club. What is the ‘positive steps MHI has taken? By their own statements, they have joined the actions of others. There is no leadership, their ownstatements make it clear that they are following. These pull-quotes from MHI’s own email make that point. Joined has been italicized to emphasize the point made.
Mandated Paid Sick Leave
- MHI has joined with more than 100 organizations representing hundreds of thousands of businesses that employ millions of employees in various industries across the country to advocate for changes to the “Families First Coronavirus Act” (H.R. 6201).
Support for Rental Property Owners
- MHI has also joined a coalition of housing groups urging Congress to provide direct federal rental assistance to families and individuals who suffer a loss of income during the crisis. The ability of rental property owners to satisfy their own financial obligations will most certainly also be impacted, so the coalition is arguing that relief should be granted to rental property owners to help ensure the continued viability of their properties.
Cash Flow for Small Businesses
- MHI has joined a coalition of business groups to urge Congress to ensure that action is taken to help businesses survive the crisis to reduce their costs and increase their cash flow in the coming weeks.
Rephrased, this is all purportedly a rather simple form of posturing. Lots of information that others have done, with little or no actual ‘leadership’ by MHI. The previously cited message from an MHI state affiliate above further underscores that point.
“While not fully up to speed about the parameters, she [i.e.: Lesli Gooch] thinks it is relevant to our homebuilding facilities which is why I was invited on the call.” Their own affiliate says Gooch – what Tim Williams called MHI’s “supurb” CEO, is “not fully up to speed.”
It is MHI members who have stated in public documents that consolidation is a goal. Given the history since Berkshire’s entry into manufactured housing, why would anyone doubt that reality?
Put differently, there is neither no history in the last decade plus of MHI leading effectively, nor is there any evidence in their own – or their surrogates – statements when carefully examined that merits any trust or confidence. Quite the opposite is true. They ought to now logically be treated in this fashion – they must earn trust by proven outcomes, not mere posturing, patting their own backs, preening and spinning. They have failed to do so time and again, and their unwillingness to discuss or debate the issues in front of an industry audience only undermines their own credibility. The modular building assocations, the Manufactured Housing Association for Regulatory Reform (MHARR) are willing to promptly reply. Why not MHI? What are they hiding from?
The chart below speaks volumes. It underscores years of reports and research by MHProNews and MHLivingNews. Odds are you and/or your colleague(s) will have more time for reading. This is the time to dive deeper and question what the powers that be in manufactured housing have done – or failed to do – for over a decade.
Retailers and communities who are supplied by production centers that are closed will clearly be impacted. There are ripple effects coming, and it is MHI that is the self-proclaimed umbrella trade group that says the represent all segments of the industry. The reasons for Mark Weiss statement below – see the in depth interview linked here – are coming ever more into focus.
That’s this installment of “News through the lens of manufactured homes and factory-built housing” © where “We Provide, You Decide.” © (Affordable housing, manufactured homes, week in review, reports, fact-checks, analysis, and commentary. Third-party images or content are provided under fair use guidelines for media.) (See Related Reports, further below. Text/image boxes often are hot-linked to other reports that can be access by clicking on them.)
By L.A. “Tony” Kovach – for MHLivingNews.com.
Tony earned a journalism scholarship and earned numerous awards in history and in manufactured housing. For example, he earned the prestigious Lottinville Award in history from the University of Oklahoma, where he studied history and business management. He’s a managing member and co-founder of LifeStyle Factory Homes, LLC, the parent company to MHProNews, and MHLivingNews.com. This article reflects the LLC’s and/or the writer’s position, and may or may not reflect the views of sponsors or supporters.
Connect on LinkedIn: http://www.linkedin.com/in/latonykovach
The text/image boxes below are linked to other reports, which can be accessed by clicking on them.