BILL REQ. #:  H-3567.1 

Read first time 01/14/2004.   Referred to Committee on Trade & Economic Development.

     AN ACT Relating to purchasing manufactured homes; amending RCW 43.185.050; adding a new section to chapter 43.185 RCW; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   A new section is added to chapter 43.185 RCW to read as follows:
     (1) For purposes of this section unless the context clearly requires otherwise:
     (a) "Department" means the department of community, trade, and economic development.
     (b) "Director" means the director of the department of community, trade, and economic development.
     (c) "Eligible person" means a person who meets the requirements set forth in subsection (3) of this section.
     (d) "Income requirement" means an income level that is at or below fifty percent of the median family income for the county or standard metropolitan statistical area where the home will be sited.
     (e) "Manufactured home purchase loan" means a loan for the purchase of a manufactured home, manufactured home lot, or manufactured home and lot that is guaranteed under the manufactured home purchase assistance program.
     (f) "Lender" means banks, trust companies, savings and loan associations, credit unions, nonprofit housing organizations, or other financial institutions that provide manufactured home purchase loans.
     (g) "Manufactured home" means a single-family dwelling built in accordance with the department of housing and urban development manufactured home construction and safety standards act, which is a national, preemptive building code.
     (h) "Manufactured home standards" means the manufactured home construction and safety standards as promulgated by the United States department of housing and urban development.
     (2)(a) The manufactured home purchase assistance program is created in the department to assist eligible persons in obtaining manufactured home purchase loans to the extent funding is provided.
     (b) Lenders providing financing to an eligible person for a manufactured home purchase loan may be insured by the manufactured home purchase assistance program against default by the eligible person under the terms provided in this section.
     (c) Before a lender makes a manufactured home purchase loan the lender must, pursuant to contract, establish the terms of the loan guarantee with the department before it may be insured under the assistance program. The manufactured home purchase loan must provide a fixed interest rate loan based upon the best prevailing market rate in the area at the time the loan is made.
     (d) If an eligible person defaults on a manufactured home purchase loan approved by the department under this section, the lender may apply to the department for reimbursement for the defaulted amount in accordance with the terms of the contract between the department and lender.
     (3) To qualify for a manufactured home purchase loan a person must:
     (a) Make a down payment of five percent of the value of the manufactured home, manufactured home lot, or manufactured home and lot;
     (b) Demonstrate that they have current adequate income to make the payments on the loan and meet their other expenses, including a salary that is at least two and one-half times the value of the expected monthly payment on the manufactured home purchase loan;
     (c) Meet the income requirement defined in subsection (1)(d) of this section;
     (d) Not have declared bankruptcy under the federal bankruptcy code at any time within the past ten years;
     (e) Provide documentation or other proof, as required by the department, that the person has been continuously employed for the three years prior to the loan guarantee request; and
     (f) Have a suitable site on which to place the manufactured home. The home may be placed on a rental site in a manufactured home park, or on an individual home site owned or leased by the borrowers. The site must meet the established local standards for site suitability and have adequate water supply and sewage disposal facilities.
     (4)(a) The department may, pursuant to a contract, agree to provide funds to a lender in the event an eligible person has defaulted on a manufactured home purchase loan. The department shall not guarantee any loans in which the available money to fund the program does not equal or exceed the amount it would cost to repay lenders if fifty percent of all current applicants defaulted on their manufactured home purchase loans.
     (b) The manufactured home purchase assistance account is created in the custody of the state treasurer. The account shall contain all money allocated by the state to the account and any other money otherwise transferred into the account. Expenditures from the account must be used only to fund the manufactured home purchase assistance program as specified under this section. Only the director or the director's designee may authorize expenditures from the account. The account is subject to allotment procedures under chapter 43.88 RCW, but an appropriation is not required for expenditures.

Sec. 2   RCW 43.185.050 and 2002 c 294 s 6 are each amended to read as follows:
     (1) The department shall use moneys from the housing trust fund and other legislative appropriations to finance in whole or in part any loans or grant projects that will provide housing for persons and families with special housing needs and with incomes at or below fifty percent of the median family income for the county or standard metropolitan statistical area where the project is located. At least thirty percent of these moneys used in any given funding cycle shall be for the benefit of projects located in rural areas of the state as defined by the department. If the department determines that it has not received an adequate number of suitable applications for rural projects during any given funding cycle, the department may allocate unused moneys for projects in nonrural areas of the state.
     (2) Activities eligible for assistance from the housing trust fund and other legislative appropriations include, but are not limited to:
     (a) New construction, rehabilitation, or acquisition of low and very low-income housing units;
     (b) Rent subsidies;
     (c) Matching funds for social services directly related to providing housing for special-need tenants in assisted projects;
     (d) Technical assistance, design and finance services and consultation, and administrative costs for eligible nonprofit community or neighborhood-based organizations;
     (e) Administrative costs for housing assistance groups or organizations when such grant or loan will substantially increase the recipient's access to housing funds other than those available under this chapter;
     (f) Shelters and related services for the homeless, including emergency shelters and overnight youth shelters;
     (g) Mortgage subsidies, including temporary rental and mortgage payment subsidies to prevent homelessness;
     (h) Mortgage insurance guarantee or payments for eligible projects;
     (i) Down payment or closing cost assistance for eligible first-time home buyers;
     (j) Acquisition of housing units for the purpose of preservation as low-income or very low-income housing; ((and))
     (k) Manufactured home purchase assistance under section 1 of this act; and
     (l) Projects making housing more accessible to families with members who have disabilities.
     (3) Legislative appropriations from capital bond proceeds may be used only for the costs of projects authorized under subsection (2)(a), (i), and (j) of this section, and not for the administrative costs of the department.
     (4) Moneys from repayment of loans from appropriations from capital bond proceeds may be used for all activities necessary for the proper functioning of the housing assistance program except for activities authorized under subsection (2)(b) and (c) of this section.
     (5) Administrative costs of the department shall not exceed four percent of the annual funds available for the housing assistance program.

NEW SECTION.  Sec. 3   If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION.  Sec. 4   This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect immediately.