1. HUD ISSUES ANTI-SCALD VALVE REFERENCE STANDARD CORRECTION
HUD has published a correction in the June 3, 2014 Federal Register to its December 9, 2013 Final Rule adopting certain modifications and updates to the Part 3280 Manufactured Housing Construction and Safety Standards. This specific correction addresses an issue previously raised by MHARR concerning the proper reference standard for “anti-scald” valves, including anti-scald valves used in combination bathtubs and showers.
In its second set of standards revisions, the Manufactured Housing Consensus Committee (MHCC) recommended that HUD adopt the American Society of Sanitary Engineering (ASSE) 1016-1996 reference standard for anti-scald valves. The 1996 edition of ASSE 1016 was also referenced in HUD’s July 13, 2010 Proposed Rule concerning these standards revisions, but at the “request” of an unidentified “commenter,” was unilaterally changed to the ASSE 2005 edition in the December 9, 2013 HUD Final Rule.
MHARR, as has been its consistent policy, objected at the time – and at a subsequent April 10, 2014 meeting with senior-level HUD officials – to this (and other) unilateral HUD changes to MHCC recommendations without further consideration or review by the MHCC. In addition, MHARR advised HUD of concerns raised by industry members regarding the specific applicability and potential cost of ASSE 1016-2005 – as compared with ASSE 1996 as recommended by the MHCC — as well as the potential unavailability of conforming equipment.
Now, in its June 3, 2014 Federal Register correction, HUD acknowledges that the ASSE 1016-2005 standard “is not the correct standard for an anti-scalding device designed for bathtub and whirlpool tubs without showers” and instead designates ASSE 1070-2004 as “the correct reference standard for anti-scald devices designed for bathtubs and whirlpool tubs without showers.” (Emphasis added).
While this correction, advanced by the new program administrator to address actions taken prior to her arrival at HUD, appears to address industry concerns regarding the correct reference standard for this particular application, potential issues still remain concerning: (1) the cost-impact of the substitute standard — which still differs from the MHCC recommended reference standard; (2) the availability of conforming equipment; and (3) the entire underlying issue of unilateral HUD changes to MHCC recommendations in final rules.
MHARR will continue its engagement with HUD and manufacturers on these issues and will provide additional information as developments warrant.
2. DOE MEETING TO ADDRESS MH ENERGY STANDARD
The Department of Energy (DOE) has announced a public meeting of its “Appliance Standards and Rulemaking Federal Advisory Committee” on June 6, 2014. While on their face this committee and this meeting do not pertain specifically to manufactured housing, among the items listed on the draft meeting agenda is a “manufactured housing negotiated rulemaking discussion and working group formation vote,” which presumably relates to the directive of the Energy Independence and Security Act of 2007 for DOE to establish manufactured housing energy conservation standards based on the International Energy Conservation Code.
As has been extensively reported and addressed by MHARR, a “draft” proposed rule to establish such standards was selectively leaked by DOE or HUD (or both) to one or more interested parties before mid-2012, based on statements contained in public record correspondence. MHARR subsequently: (1) requested a DOE/HUD investigation of the process leading to the selective disclosure of the draft proposed DOE energy rule; (2) filed related Freedom of Information Act (FOIA) requests with both agencies; and (3) in written comments responding to a June 25, 2013 DOE “Request for Information” (RFI) concerning manufactured housing energy conservation standards, called on DOE to completely discard its selectively-disclosed “draft” proposed rule and “allow sufficient time for the development, analysis and evaluation of information concerning potential adverse impacts and … cost implications of any new energy conservation standards.”
Now, having never published either the selectively-leaked “draft” proposed rule – or any other proposed manufactured housing energy conservation rule in the Federal Register – it appears that DOE may be going back to the “drawing board” on the entire issue of manufactured housing energy conservation standards as suggested by MHARR in its RFI comments and other correspondence with DOE regarding theselectively-leaked “draft” proposed rule.
While it remains to be determined what DOE envisions with a “negotiated” rulemaking, including: (1) who it will be “negotiating” with; (2) who will be appointed to the “working group” referenced in theJune 6, 2014 meeting announcement; and (3) whether that “working group” will include proper representation of all program stakeholders, MHARR will continue to make it clear that any action or activity based on the selectively–leaked draft proposed rule is unacceptable, that any “working group” that does not include proper representation of industry small businesses will be illegitimate, and that any DOE process must include consultation with – and the full involvement of – both HUD and the MHCC, at a meaningful stage in the proceedings, as envisioned by the EISA law.
MHARR will continue to monitor activity relating to this rule very closely and provide further updates as warranted by new developments.
3. MHARR FOLLOW-UP TO HUD FOIA RESPONSE
HUD has now responded – with both documents and a formal letter — to MHARR’s September 25, 2012 Freedom of Information Act (FOIA) request. That request, as reported previously, was focused primarily (although not exclusively) on the Department’s unilateral expansion of manufactured housing in-plant regulation and a related September 11, 2008 meeting in Indiana between certain manufacturers, Primary Inspection Agencies (PIAs) and HUD regulators, including the then-federal program administrator.
While the HUD response, amounting to over 1,000 pages of documents, covers many of the 48 categories of documents initially sought by MHARR, it is apparent that HUD’s disclosure does not addressall of MHARR’s requests, including some highly significant categories of program documents – even though additional responsive documents are not identified or claimed as exempt from FOIA disclosure in HUD’s final response letter.
Consequently, MHARR has instructed its attorneys and law firm, Mayer-Brown, to seek further clarification from HUD regarding the scope of its search, as well as the possible existence of other non-disclosed responsive documents (some of which clearly exist because they have already been received by MHARR from other non-HUD sources), as a prelude to possible further action regarding HUD’s response.
MHARR’s FOIA request and this follow-up activity are based on and reflect MHARR’s commitment to pursuing full HUD compliance with – and final implementation of all remaining aspects of — the Manufactured Housing Improvement Act of 2000, as a top Association priority. In particular, the 2000 reform law established specific procedures for the open, transparent and accountable discussion and consideration of the manufactured housing standards and regulations, and their interpretation, as a cure and remedy for the often closed-door procedures that had been the norm earlier in the history of the program. MHARR’s FOIA request was designed in substantial part to expose proceedings under the prior administration of the program that skirted those requirements and simultaneously discourage activity inconsistent with these requirements going forward.
MHARR will provide updates on this activity as new developments unfold.
4. HUD APPROPRIATIONS BILL PASSES SENATE SUBCOMMITTEE WITH NO RV DEFINITION AMENDMENT
A June 3, 2014 mark-up hearing on the Fiscal Year 2015 Transportation, HUD and Related Agencies (THUD) appropriations bill by the Senate THUD Appropriations Subcommittee has concludedwithout the inclusion of any RV definition language that would further tamper with the federal manufactured housing law. Indeed, no amendments of any type were offered at the brief subcommittee hearing. Having now been approved by the Subcommittee on a voice vote, the bill moves forward to a mark-up hearing before the full Senate Appropriations Committee, scheduled for June 5, 2014.
The intensive “scorched-earth” campaign in Congress by the Recreational Vehicle Industry Association (RVIA) for an expanded RV exemption in the federal manufactured housing law via the appropriations process – with no hearings or other substantive consideration — is rapidly becoming a double-edged sword for that industry as more and more stakeholder constituencies begin to fully recognize theextremely negative long-term consequences of any such change. This includes consumers — who have always been opposed to an expanded RV/park model exemption — state authorities who would see a proliferation in the misuse of larger RVs and park models as unregulated de facto housing, manufactured housing industry members who would be subjected to unfair competition by such a proliferation of unregulated RVs and park models, and “pure” (i.e., single industry) HUD Code state associations, which correctly perceive that an expend RV/park model exemption would lead to major problems affecting zoning, placement, taxation and a host of other related state and local-level issues.
Thus, while RVIA continues to press a full-blown effort in Congress to slip expanded exemption language into the federal manufactured housing law via all six stages of the appropriations process (i.e., subcommittee level amendment, committee level amendment and/or floor amendment in both Houses) – much as it did with its initial exemption for “self-propelled” RVs in 1998 – a de facto coalition of affected stakeholder constituencies has mobilized to inform and educate Congress in an effort that has thus far been successful in stopping the RV amendment at three stages of the congressional process (i.e., the House THUD appropriations subcommittee, the full House Appropriations Committee and the Senate THUD appropriations subcommittee). That level of mobilization, moreover, must be maintained, particularly as the appropriations process reaches the floor of both Houses.
It is noteworthy that the RV industry’s persistence in pursuing this misguided legislative approach with Congress is rapidly exposing the lack of any legitimate factual basis for the rationales it has offered in support of its proposed expanded exemption, including, most particularly, its claim that a “lack of clarity” in the federal manufactured housing law is diminishing the availability of chattel financing for RVs and park models from finance companies afraid of running afoul of the “high-cost” loan provisions of the Dodd-Frank law that are applicable to manufactured homes. When pressed at a recent staff-level congressional hearing, the RV industry could not point to a single actual instance of being denied financing for its products. Instead, RV industry representatives could only point to “concerns” over speculative financing problems at some point in the future.
But even this allegation rings hollow because RVs (and park model “trailers”), as vehicles, are exempt from Dodd-Frank and related Consumer Finance Protection Bureau (CFPB) regulations. If such units are sold or utilized as permanent dwellings, however, it could be argued that they should be treated in the same manner as manufactured homes under the very same “high-cost” CFPB rules and Dodd-Frank requirements that the HUD Code industry – led by MHI and the states, with full MHARR support – is attempting to revise through H.R. 1779 and companion Senate legislation (S. 1828). MHARR is researching this matter, however, to determine, among other things, if RV finance companies are seeking to evade Dodd-Frank “high-cost” loan requirements that would otherwise be applicable based on the nature of the loan itself.
Regardless of the alleged motivations for the RV definition amendment, MHARR has consistently maintained that there are only two valid and legitimate ways to address this issue: (1) either remove all RV references from the federal manufactured housing law and HUD regulations – which would then define “manufactured homes” as “dwellings” and thereby exclude non-“dwelling” RVs (as well as park models and every other non-“dwelling”), which the RV industry, of course, does not favor; or (2) proceed through the open, transparent and inclusive HUD regulatory process to revise the applicable regulatory definitions to address any legitimate concerns raised by the RV industry. Short of these two, any congressional consideration of this matter should be through the relevant authorizing committees, with full hearings and the opportunity for participation by all affected stakeholders.
MHARR has stated its preference for the second of the above two options, but cannot rule out an effort by non-RV stakeholders to strike all RV language once and for all if the RV industry persists in an ongoing effort to tamper with the federal law. That said, if this matter is followed-up through the HUD regulatory process, the RV industry – unlike its previous forays in the HUD regulatory process — will need to be prepared to address the questions and concerns of other program stakeholders, and not split between differing representation of RV and park model interests.
And it currently appears that Congress, in a compromise gesture consistent with MHARR’s call for a regulatory (rather than legislative) approach to this matter, may be moving in the same direction. Thus, while RV language has not been included in the appropriations bills currently pending in both Houses, language is possible in the Senate THUD subcommittee report on the FY 2015 HUD appropriations bill that would direct this matter back to HUD and its regulatory process.
Based on all of the above, and pending the June 5, 2014 full Senate Appropriations Committee mark-up, MHARR continues to urge the entire HUD Code industry to: (1) not take this matter too lightly; and (2) contact their representatives and senators in to urge them not to support the inclusion of an expanded RV/park model exemption in the federal manufactured housing law and instead support a return of this matter to HUD to be addressed through the HUD regulatory process.
