Manufactured/Mobile Home Landlord-Tenant Act. The Manufactured/ Mobile Home Landlord-Tenant Act (MHLTA) governs the legal rights, remedies, and obligations arising from any rental agreement between a landlord and a tenant regarding a lot within a manufactured/mobile home community (MHC) where the tenant has no ownership interest in the property.
Notice of Closure. Under the MHLTA, any rental agreement must include either a covenant by the landlord that the MHC will not be converted or sold for three years or a statement that the MHC may be sold, transferred, or closed at any time after the required closure notice is provided to the tenants.
A landlord may not terminate or fail to renew a tenancy except if they change the land use of the MHC including, but not limited to, closure of the MHC or conversion to a use other than for mobile homes, manufactured homes, or park models or conversion of the MHC to a mobile home park cooperative or mobile home park subdivision. In these cases, a landlord must provide each affected tenant with 12 months notice in advance of such change. This 12 month notice requirement does not apply if the:
If compensation is paid, the landlord must provide written notice of at least 90 days in which the tenant must vacate.
Notice of Sale. Under the MHLTA, a landlord must provide written notice of sale by certified mail or personal delivery to each tenant of the MHC, the officers of any known qualified tenant organization, the office of mobile/manufactured home relocation assistance, the local government and housing authority within whose jurisdiction all or part of the MHC exists, and the Washington State Housing Finance Commission.
Each notice of sale must include a statement that the landlord intends to sell the MHC and the contact information of the landlord or landlord's agent who is responsible for communicating with the qualified organization or eligible organizations with regard to the sale of the property.
A landlord intending to sell a MHC is encouraged to negotiate in good faith with qualified tenant organizations and eligible organizations.
A qualified tenant organization is a formal organization of tenants within an MHC, wherein the only requirement for membership is being a tenant. An eligible organization includes local governments local housing authorities, nonprofit community or neighborhood-based organizations, federally recognized Indian tribes in the state of Washington, and regional or statewide nonprofit housing assistance organizations.
The bill as referred to committee not considered.
Notice of Closure. The required closure notice before closure or conversion of the MHC is modified from three to two years. The option for landlords to include a covenant not to convert land use of the MHC for a three year period in the initial lease with the tenant is eliminated. Any tenant who sells their home within an MHC must provide the buyer with a copy of any closure notice in effect at least 15 days before the intended sale.
The two-year closure notice requirement does not apply if: the MHC has been acquired for or is under imminent threat of condemnation; the MHC is sold or transferred to a county in order to reduce conflicting residential uses near a military installation; or the MHC is sold to an eligible organization.
The two-year closure notice requirement is reduced:
In both cases, if a home remains in the MHC after the tenant vacates, the landlord is responsible for its demolition or disposal.
Notice of Sale. The required notice of sale is modified to include intent to sell or lease the MHC or the property on which it sits (underlying property). The definition of "notice of sale" is also modified to include both public and private notice that an MHC or the underlying property is for sale or lease.
Notice of Opportunity to Compete to Purchase. A landlord must provide a written notice of opportunity to compete to purchase indicating the owner's interest in selling the MHC before the owner markets the MHC for sale or includes the sale of the MHC in a multiple listing and when the owner receives an offer to purchase that the owner intends to consider. A notice of opportunity to compete to purchase must be provided to each tenant, a qualified tenant organization if in existence within the MHC, the Department of Commerce (Commerce), and the Housing Finance Commission within 14 days after the date on which any advertisement, listing, or public notice is first made that the MHC or the underlying property is for sale or lease.
A notice of opportunity to purchase compete to purchase must include:
Commerce is required to maintain a registry of all eligible organizations that submit written requests to receive notices of opportunity to purchase or lease an MHC. Commerce must provide registered eligible organizations with notices of opportunity to purchase once it receives such notice.
Competing to Purchase. If the tenants choose to compete to purchase the MHC in which they reside, within 70 days after delivery of the notice of the opportunity to compete to purchase, they must notify the owner of: the tenant's interest in competing to purchase the MHC; their formation or identification of a single qualified tenant organization; and the name and contact information of the representative or representatives of the qualified tenant organization with whom the owner may communicate about the purchase.
Within 15 days from the delivery of notice that the tenants will compete to purchase, the designated representative of the qualified tenant organization may make a written request to the owner for: (1) the asking price for the MHC; and (2) financial information relating to the operating expenses of the MHC in order to assist them in making an offer to purchase the MHC. In response, the owner may make a written request to the designated representative or representatives of the qualified tenant organization for proof of intent to fund a sale.
Within 21 days after delivery of information relating to the asking price and financial information relating to the operating expenses of the MHC, if the tenants choose to continue competing to purchase, the tenants must:
Within ten days of receiving the tenants' purchase and sale agreement, the owner may accept, reject, or counteroffer. If the parties reach agreement on the purchase, the purchase and sale agreement must specify the price, due diligence duties, schedules, timelines, conditions, and any extensions. If the offer is rejected, then the owner must provide a written explanation of why the offer is being rejected and, if any, what terms and conditions might be included in a subsequent offer for the landlord to potentially accept it. The price, terms, and conditions of an acceptable offer stated in the response must be universal and applicable to all potential buyers and must not be specific to and prohibitive of a qualified tenant organization or eligible organization making a successful offer to purchase the park.
Good Faith Requirement. The parties have an overall duty to act in good faith. With respect to negotiation, this overall duty of good faith requirement means that the owner must allow the tenants to develop an offer, give their offer reasonable consideration, and inform the tenants if a higher offer is submitted. The owner may not deny residents the same access to the community and to information that the landowner would give to a commercial buyer.
Exclusivity. During the negotiation process, the owner may seek, negotiate with, or enter into a contract subject to the rights of the tenants in this act with potential purchasers other than the tenants or an entity formed by or associated with the tenants or another eligible organization.
Substantial Compliance. If the owner does not comply with the requirements of this act in a substantial way that prevents the tenants or an eligible organization from competing to purchase the manufactured/mobile home community, the tenants or eligible organization may: obtain injunctive relief to prevent a sale or transfer to an entity that is not formed by or associated with the tenants; and recover actual damages not to exceed twice the monthly rent from the owner for each tenant.
Certification of Compliance. An owner may record an affidavit in the county in which the manufactured/mobile home community is located which certifies that the owner has: complied with the requirements relating to an offer received by the owner for the purchase or transfer of the MHC or to a counter-offer the owner has made or intends to make; and not entered into a contract for the sale or transfer of the MHC to an entity formed by or associated with the tenants.
Exemptions from Notice Requirement. A notice of opportunity to compete to purchase is not required for any:
The notice of opportunity to compete to purchase requirements and penalties do not apply to any sale or transfer of a manufactured/mobile home community to a county in order to reduce conflicting residential uses near military installations.
Penalties. A landlord who sells or leases an MHC and willfully fails to comply with the notice of opportunity to purchase, or the notice of intent to consider purchasing or leasing offer or acceptance waiting period is liable to the state for a civil penalty of $10,000. The attorney general may bring a civil action in the name of the state against a landlord.
Preemption. No county, city, town, or municipality may enact, maintain, or enforce ordinances or other provisions that regulate the same matters as sections 8 through 12 of the bill after May 1, 2023.
The committee recommended a different version of the bill than what was heard. PRO: Manufactured housing is accessible, affordable housing and it is important to preserve this type of affordable housing. Manufactured housing is the most accessible path to homeownership for low income households. Rent increases are destabilizing homeowners and causing displacement in addition to park closures. This bill incentivizes and provides meaningful opportunity for permanent preservation by nonprofits who would keep rent within reach of homeowners. It is in the interest of the states for nonprofits to purchase MHCs.
MHCs are a valuable but dwindling resource for affordable housing. Many MHC residents are older adults, aging in place, or on fixed incomes. Not owning the land underneath the property creates insecurity by not knowing if rents will be raised. The biggest challenge to living in an MHC is the reality of the stress if served a notice 12-month notice that they need to move. Most tenants are elderly or fixed-income. MHCs are almost completely full, if a park were to close there would be nowhere to go for most residents.
The Legislature needs to support the communities. Incentivizing eligible organizations and nonprofits to purchase an MHC is positive for tenants. Policies should allow nonprofit housing authorities to purchase and preserve communities. This bill creates a real opportunity to purchase for eligible organizations to step in, negotiate, and potentially purchase the park. Resident own purchase is useful and has been successful.
CON: The bill interferes with legal procedures around real estate transactions and it confuses selling a park with closing the park. A community sale isn't always a closure. The prolonged closure period is challenging and the 24 month or 12 month options are too costly. Sale of the land after closure would not offset rental assistance/compensation costs. The bill will cause more instability in MHCs that protections. The bill could cause many parks to go for sale or close down and could keep people from building more MHCs.
This bill is a disproportionate burden on one type of property and will discourage and disincentivize investment in more MHCs. The additional timeline restrictions will increase price of transactions because it would negate the ability for other bidders to use a 1031 exchange. Obligation of a qualified tenant organization does not exist. Sale of mobile home park should not differ from another type of real estate sale.
There are not enough housing units available in Washington. MHC owners are housing providers. Instead of creating more housing, this bill punishes existing owners. There is not an epidemic of parks closing. In 2022, only 129 sites out of 72,000 were taken down. A big issue with restricting the closure of MHCs is safety. The bill doesn't bring new inventory to the market. The Oregon bill is useful with regard to opportunity to purchase.
OTHER: The bill penalizes MHC owners rather than incentivizing the creation of more MHCs.
The committee recommended a different version of the bill than what was heard. PRO: This is a good compromise. There are a couple of errors that can easily be corrected from the floor.
CON: This bill violates the state constitutional rights. This well-meaning bill is a lawsuit waiting to happen. The Legislature should choose a path of incentives for landlords instead of what the current bill is.
OTHER: We are in strong support of a compromise. This is a very hard worked bill including with members of the house. We still need to fix this bill going forward but the proposed substitute is a good step going forward. We think that the second substitute represents a fair balance between the owners and the tenants for getting notification who may have disruption in their lives.