MHI Week In Review — January 6, 2011


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MHI Members Urged to Contact District Congressional Offices – Energy Efficiency Home Tax Credit Expired on December 31, 2011

The federal tax credit for manufacturers who build energy efficient homes (Section 45L) expired on December 31, 2011. After extending the Social Security payroll tax cut, unemployment benefits and Medicare payments to physicians, Congress adjourned for the holiday recess. A host of important temporary tax incentives, frequently called “tax extenders” — including the New Energy Efficient Tax credit for manufactured and modular homes was not included in the year-end tax deal. Specifically, manufacturers who build ENERGY STAR homes were eligible to receive a $1,000 tax credit and modular home builders were eligible to receive a $2,000 tax credit by exceeding the International Energy Conservation Code (IECC) by 50 percent.

MHI, along with its broad-based coalition of energy efficiency and environmental organizations, housing associations, public interest groups and corporations sent letters to Members of Congress urging them to extend the New Home Energy Efficient Tax Credit. Stimulating the economy will be high on the priority list for Congress. Senate Finance Committee Chairman Max Baucus (D-MT) vowed to continue working in January to extend tax cuts for individuals and small businesses. Baucus has been quietly working with his colleagues and fighting to find a bipartisan path forward for these tax extenders, including the research and development tax credit and job-creating clean energy tax incentives.

The House of Representatives returns to Washington, D.C. on Tuesday, January 17th while the Senate reconvenes on Monday, January 23rd. Upon the return of our elected officials, MHI would like to be well-positioned to advocate for the passage of the extension of the ENERGY STAR tax credit for manufactured and modular homes.

MHI members are encouraged to call their representative’s district office. Contact information for congressional offices is available by clicking hereClick here for the issue paper.MHI members can contact Rae Ann Bevington at 703-558-0675 or

President Supersedes Congress with CFPB Recess Appointment, Poised to Regulate Non-Bank Financial Institutions Immediately

On January 4th, in what many predict will be a constitutional test of the President’s authority, the White House bypassed Senate objections and appointed Richard Cordray as Director of the Consumer Financial Protection Bureau (CFPB).

The recess appointment sparked an immediate backlash among Senate Republicans who had previously been successful in preventing the nomination from reaching the Senate floor for an up-or-down vote.

The Senate has technically remained in session, on a pro-forma basis, due to the unwillingness of House Republican leaders to approve a procedural motion that would allow the Senate to formally go on recess for periods in excess of three days. House Republicans had used this tactic in an attempt to prevent the White House from making a recess appointment. Under the constitution, each chamber needs the other’s permission to go on recess. It is expected that the legality of the appointment will be tested in court.

The recess appointment is significant. The designation of an official director allows the agency to assume full authority to regulate non-bank lenders, which the CFPB defines as a company that provides consumer financial products or services but lacks a bank, thrift or credit union charter.

The CFPB has indicated that it will adopt an approach to examining non-bank institutions similar to the one it uses for bank examinations. In October, the CFPB released its field guide that examiners will use for its examinations. Click here to view the guide.

In moving forward to implement this program, the CFPB has indicated it will:• Expand its ongoing supervision of mortgage servicers to nonbank mortgage servicers

• Publish additional examination procedures tailored to the types of consumer financial products and services offered by nonbanks
• Propose an initial rule to begin defining who meets the test for “larger participants” in certain nonbank markets
• Publish rules to establish procedures to supervise a nonbank company where the CFPB has reasonable cause to believe it poses risks to consumers
• Continue ongoing communications with state and federal regulators with a more specific focus on examination planning
• Continue to obtain feedback on its supervision program from nonbank financial services companies, banks, thrifts, and credit unions, federal and state agencies, consumer and community groups, and the public.

Payday lenders, private education lenders and non-bank mortgage servicers have been part of a class of financial institutions characterized as the “shadow banking industry,” which has been criticized by consumer advocates for their predatory practices resulting from the lack of oversight at the federal level. Non-bank manufactured home lenders could potentially be included in this class of institutions and potentially subject to the examination of the CFPB.

For more information on the CFPB’s plan, click here.

MHI members can contact Jason Boehlert at 703-558-0660

CFPB Releases Several Requests for Comments

Prior to the holidays, the Consumer Financial Protection Bureau (CFPB) unveiled a number of requests seeking comments on rules. The Dodd-Frank Act transferred rulemaking authority for a number of consumer financial protection laws from seven federal agencies to the CFPB as of July 21, 2011. The agency is in the process of republishing the regulations and implementing those laws with technical and conforming changes to reflect the transfer of authority. Click here to view.

Of particular concern to MHI members, is a request for comments seeking input on the streamlining of existing regulations. Click here to view the request. MHI is in the process of developing comments for submission, which the agency must receive by March 5, 2012.

Since the Dodd-Frank Act passed in July 2010, 21 percent of the act’s 400 rulemaking requirements have been finalized, but 74.5 percent of rulemaking deadlines have been missed to date. This is according to data compiled by the Davis Polk & Wardwell Dodd-Frank Regulatory Tracker. To view click here.

MHI members can contact Jason Boehlert at 703-558-0660

DOE Seeks Comments on Enforcement of Energy Efficiency Standards for Residential Furnaces, Air Conditioners and Heat Pumps

On December 16th, MHI staff and several supplier members participated in a Department of Energy (DOE) public meeting on three possible approaches to enforcement of regional standards to residential furnaces, central air conditioners and heat pumps. DOE plans to propose rulemaking to establish an enforcement framework for compliance with the new energy efficiency standards for these appliances.

Effective May 1, 2013, all non-weatherized furnaces must meet new regional energy efficiency standards. Weatherized furnaces, central air conditioners, and heat pumps must meet new regional standards by January 1, 2015.

The enforcement and compliance options under consideration will impact appliance manufacturers and distributors of these appliances including manufactured and modular homebuilders, retailers, and contractors who install them on site. Depending on the enforcement option ultimately adopted, appliance manufacturers would be required to certify product efficiencies, inform distributors about appropriate regions, and track shipments to distributors. Distributors would be required to inform installers about appropriate regions, track unit sales to contractors, and collect information from contractors. Contractors would be required to install units in the appropriate region, maintain records and paperwork about installation location, and provide information to appliance distributors.

The majority of meeting participants expressed concern about the increased costs and paperwork and recordkeeping required to comply with the new standards, particularly for small distributors and contractors. Given the current distribution market for heating and cooling equipment and the prevalence of internet purchases, several participants said it would be virtually impossible to enforce compliance with regional energy standards without sophisticated and costly software and database systems.

MHI plans to comment on DOE’s proposed enforcement framework and will solicit input from suppliers manufacturers and retailers. Click here to view a copy of the enforcement framework.

MHI members can contact Lois Starkey at 703-558-0654

MHI-PAC Thanks Industry Members for a Great Year

Thanks to all 2011 MHI-PAC contributors who have stepped up to the plate on behalf of MHI’s government affairs efforts through your contributions to the MHI-PAC.

MHI-PAC continues to be a crucial ingredient in the Manufactured Housing Institute’s work to represent our industry in Washington. Our ability to have sufficient resources to provide political help to those lawmakers who demonstrate an understanding and support of our issues is extremely important. Thanks to our members, MHI-PAC is working to help the Manufactured Housing Institute make the case for our industry on Capitol Hill.

To those who helped make 2011 a success – thank you. Together we can build upon our success and make 2012 a banner year!

MHI members can contact Rae Ann Bevington at 703-558-0675 or


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