MHARR Widens Inquiry

Washington, D.C., December 7, 2009 — The Manufactured Housing Association for Regulatory Reform (MHARR) has widened its inquiry into the ongoing coercion of manufactured housing producers by HUD regulators and agents under the guise of “voluntary” cooperation. Any such “request” by regulators within a comprehensive regulatory system for “voluntary” action above and beyond existing regulations, without a specific document that has gone through the rigors of rulemaking, is accurately perceived, by the regulated party, as pressure and coercion.

Such coercion of manufacturers in their production facilities — designed to pressure them to accept and implement costly new production oversight practices not required by current program regulations — had its genesis in 2008 and has expanded and intensified during 2009… These new practices, which would significantly increase regulatory compliance costs without any corresponding benefit for consumers, at a time when consumers are having unprecedented difficulty qualifying for scarce mortgage financing, have not been reviewed or recommended by the Manufactured Housing Consensus Committee (MHCC) — representing a cross-section of HUD program stakeholders — as required by the 2000 reform of the manufactured housing law. They are also related to a HUD proposal for a major expansion of the current manufactured housing Procedural and Enforcement Regulations that failed, in a September 2009 ballot, to gain the consensus support of the MHCC.

As a result, MHARR has called upon HUD’s General Counsel to review and halt this activity, which unfairly pressures manufacturers to conform to requirements that substantially exceed current program regulations and, at the same time, threaten to create a lopsided regulatory playing field for producers within a highly competitive industry.

This latest MHARR initiative closely follows and expands upon the Association’s October 26, 2009 request to HUD under the Freedom of Information Act (FOIA) to disclose a wide array of documents relating to the genesis of this activity, including materials reflecting the substance of — and participation in — closed-door or other meetings involving HUD regulators, the program monitoring contractor, and third-party Primary Inspection Agencies (PIAs).

In Washington, D.C., MHARR stated: “At a time when the manufactured housing industry is suffering through the worst decline in its history and consumers of affordable housing — particularly lower and moderate-income families — are having unprecedented difficulty qualifying for mortgage financing, manufacturers should not be pressured to adopt costly changes that have not been subject to the rigors of rulemaking. While any manufacturer that wishes, on its own, to adopt production oversight changes on a truly voluntary basis should be free to do so, the initiative for such changes should come from the manufacturer, not regulators.”

The Manufactured Housing Association for Regulatory Reform is a Washington, D.C.-based trade association representing the views and interests of producers of federally-regulated manufactured housing.

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