HOUSE BILL REPORT
ESHB 995
BYHouse Committee on Housing (originally sponsored by Representatives Todd, Cantwell, Crane, Cooper, Leonard and Nutley)
Establishing a mobile home park purchase fund.
House Committe on Housing
Majority Report: The substitute bill be substituted therefor and the substitute bill do pass. (5)
Signed by Representatives Nutley, Chair; Leonard, Vice Chair; Armstrong, Ebersole and Todd.
Minority Report: Do not pass. (2)
Signed by Representatives Barnes and Sanders.
House Staff:Charlie Gavigan (786- 7340)
AS PASSED HOUSE MARCH 17, 1987
BACKGROUND:
A mobile home park is a parcel of land under single ownership on which mobile or manufactured homes are located. Generally the land is rented out to tenants who own their mobile/manufactured home. There is usually a certain amount of common space and common facilities for tenants. A mobile home park may have a tenant organization to interface with the park owner. Mobile homes have traditionally provided low cost housing for elderly and low income persons.
There is some evidence that rising costs of mobile home park development and operation, plus speculative investment, have reduced the primary benefit provided by mobile or manufactured homes: moderate and low-cost housing. This implies that the sale of mobile home parks may often result in an increase in rents.
The Department of Community Development (DCD) is a department created to assist in providing financial and technical assistance to the communities of the state, to assist in improving the delivery of federal, state, and local programs, and to provide communities with access to opportunities for productive and coordinated development beneficial to the well-being of the communities and their residents. A significant portion of the department's efforts have focused on housing issues.
SUMMARY:
The legislative intent of this measure is to encourage and facilitate the conversion of mobile home parks to residential ownership, which would be accomplished primarily through private funding of mobile home park conversions (to resident owned). This is intended to maintain the affordability of housing in these resident owned parks for the low income, elderly, poor or infirm.
A mobile home park purchase fund is created in the office of the treasurer. The Department of Community Development (DCD) is charged with administering the program.
Loans can be made to tenant organizations for conversion costs. The loan is for the minimum amount necessary to enable the organization to purchase the park, but cannot exceed 50 percent of the conversion costs. The loan term is a maximum three years; the interest rate is a competitive rate set by DCD. Loans can only be made to tenant or resident organizations in which a significant portion are low income, elderly, poor or infirm.
Eligible tenant or resident organizations are mobile home park residents who have formed a legal entity (i.e. nonprofit corporation) for the purpose of acquiring the mobile home park in which they live. It must include two thirds of the households residing in the mobile home park at the time of the request for assistance to purchase the park.
Loans may also be made to individuals to reduce the monthly housing costs for low income residents to an affordable level (30 percent of monthly income). The loan amount is for the least amount necessary to reduce the borrower's housing costs to the affordable level, but not to exceed 50 percent of the acquisition cost of the individual's interest in the mobile home park. The maximum term is 30 years; the interest rate is a competitive rate set by DCD.
The Department of Community Development must consider, among other things, local housing programs, the reasonableness of the conversions and whether it is the most efficient use of the funds. The Department must seek to distribute the funds statewide, with a goal of at least 20 percent in rural areas.
An office of mobile home affairs is created in the Department of Community Development. The office will deal with matters relating to mobile or manufactured homes, and will promote effective utilization of mobile homes.
The mobile home affairs office will provide an ombudsman service to assist in the resolution of disputes between park owners and tenants, to help access governmental services related to the health and safety of mobile home parks, and to provide technical assistance in converting mobile home parks to resident ownership.
The office is also asked to develop policies and strategies to promote utilization of mobile or manufactured homes which will enhance the supply of safe and low cost housing in the state.
A five member advisory committee composed of one representative each from mobile home manufacturers, mobile home park owners, mobile home tenants, local government and the public is established. This advisory committee is to provide input to the Department of Community Development regarding mobile home issues including mobile home landlord tenant issues.
EFFECT OF SENATE AMENDMENT(S): The Senate amendments make the following changes:
(1) the department is not required to specify the factors to be included in "housing costs";
(2) the requirements for individual eligibility for a loan from the fund are modified to include consideration of net worth except for the value or the mobile home itself;
(3) the park owner retains full control of that portion of the park not sold to the tenants when the entire park is not sold;
(4) the negative amortization example of flexible loan repayment plans is removed;
(5) the office of mobile home affairs may not address policies regarding government control of the economic return from parks to park owners; and
(6) the advisory committee to the office of mobile home affairs is required to have representatives of the park owners and the park tenants who are knowledgeable about and have experience with the mobile home landlord tenant act.
Fiscal Note: Not Requested.
House Committee ‑ Testified For: Fred Brume; Gary McFadden, Washington Mobile Park Owners Association; John Jensen, Mobile Home Owners Association; and Steven J. Kolcsey, Washington Mobile Park Owners Association.
House Committee - Testified Against: None Presented.
House Committee - Testimony For: The increase in rents in mobile home parks would be more controllable if the tenants/residents owned the park. This would especially assist those low income and elderly persons who are being pushed out of the last vestige of affordable housing.
House Committee - Testimony Against: None Presented.
VOTE ON FINAL PASSAGE:
Yeas 74; Nays 22; Absent 1; Excused 1
Voting Nay: Representatives Ballard, Barnes, Basich, Belcher, Braddock, Bumgarner, Grant, Hankins, Hargrove, Heavey, Holland, Jesernig, Lewis, Locke, McLean, Niemi, Prince, Schoon, Silver, L. Smith, B. Williams and Wineberry
Absent: Mr. Speaker
Excused: Representative C. Smith