To: Concerned Members of the Manufactured Housing Consensus Committee (MHCC)

Dear Friends:

Thank you all for sharing your thoughts, concerns and observations regarding the rapidly deteriorating status of the MHCC. MHARR has fully reviewed and analyzed your comments, as well as input from within the industry regarding this very important matter, and offers the following suggestions for reversing the downgrading of this important forum for the manufactured housing industry and its consumers.

As is well known, the industry, consumers and other HUD program stakeholders worked for over a decade to ensure that a consensus committee with specific statutory authority would be included in the Manufactured Housing Improvement Act of 2000 as an independent check and balance against the previous abuses of regulators, contractors, consultants and special interests. And, for nearly a decade, the MHCC functioned reasonably effectively — with transparency and accountability — as intended by Congress. HUD regulators, however, have never accepted the concept of a robust and independent MHCC and for the last several years, under the prior management of the manufactured housing program, pressure has built to downgrade the MHCC and make it irrelevant to the fundamental underpinning of relevant federal law — i.e., maintaining a balance between consumer protection and preserving the affordability of manufactured housing.

This activity began in earnest when the previous management pressed for an MHCC gag rule in 2007 and reached its culmination with the actions and rulings on display at the April 2010 MHCC meeting in Tulsa, Oklahoma.

The previous HUD program management was able to take these steps because of a lack of effective resistance by program stakeholders and most particularly because half of the manufactured housing industry in Washington, D.C. has passively acquiesced in the actions and decisions that have downgraded the Committee. To undo what has occurred, the most effective and timely approach, therefore, would be for the industry (and more specifically, both of its national organizations in Washington, D.C., MHI and MHARR), consumers and other program stakeholders to work aggressively and effectively with the new leadership of the HUD program to seek retraction of specific actions of the prior program management, and put the MHCC back on right track. At present, suggestions to return to Congress or mount legal challenges are premature and too time consuming… thus, a more effective approach will be for all program stakeholders to work with the new HUD program management to address and resolve this urgent matter.

As many of those offering comments or inquiries to MHARR have suggested, we have conducted another review of all factors involved in this matter, and the following are points that we suggest be taken up with the new HUD program leadership:

• HUD needs to stop equating the MHCC with — and treating it like — other “Federal Advisory Committee Act” (FACA) committees. FACA section 4(a) specifically states that FACA can be superseded by specific provisions in other laws. In this case, it is the 2000 reform law that specifically delineates the composition, role, authority and processes of the MHCC. Those powers cannot be restricted by the application of FACA.
• HUD needs to stop characterizing the role of the MHCC as being merely to “advise” the Department on HUD standards and regulatory proposals. Sections 602(b)(6), 604(a) and 6(b) of the 2000 law are quite clear and HUD must comply fully with these provisions.
• HUD needs to retract, in the Federal Register, its February 5, 2010 “Interpretive Rule” which effectively reads important catchall section 604(b)(6) out of the law.
• HUD needs to return control of the MHCC internal process to the Committee and its leadership. Nothing in FACA — even if the MHCC were a pure FACA committee — provides for HUD control over the assignment of proposals to subcommittees, the prioritization of proposals, or the exclusion of public comments and input during meetings.
• HUD needs to re-appoint the industry’s collective representatives (albeit non-lobbyists) to the MHCC in order to balance the influence of regulators, contractors, consultants and other special interests with the institutional memory, know-how, knowledge and expertise that the industry has painstakingly assembled in Washington, D.C. since the industry was placed under federal jurisdiction in 1974.
• Also to be addressed are numerous other actions of the prior HUD program management that have downgraded the status of the MHCC and which also must be resolved.

As I mentioned earlier, MHARR is confident that the new leadership at HUD, once it fully understands the importance and necessity of fully complying with the 2000 reform law, will start to correct the actions of the prior management that have taken the MHCC off-track. But this will require a firm and consistent position by all segments of the industry, who face the challenge of offering manufactured homes at affordable prices, while fully protecting home-buyers.

Thanks again to all of you, as well as concerned industry members, for your continuing comments and input on this urgent matter, and please rest assured that the subject of the MHCC — since the April 2010 Tulsa meeting — has rapidly moved to the top of MHARR’s list of priorities in Washington, D.C.

Danny

cc: HUD Code Manufacturers

Danny D. Ghorbani President Manufactured Housing Association for Regulatory Reform 1331 Pennsylvania Ave. N.W. Suite 508 Washington, D.C. 20004 Phone: 202/783-4087 Fax: 202/783-4075 Email: DANNYGHORBANI@AOL.COM