New House Bill Would Fund Manufactured Housing Community Preservation
On January 7, Representatives Cindy Axne (D-IA) and Ro Khanna (D-CA) introduced H.R. 5547, the Manufactured Housing Community Preservation Act, which, if enacted, would be the first meaningful federal program to invest in the preservation of manufactured housing communities. As a match program, the legislation would encourage states, localities and private actors to enter or expand their roles in the preservation of one of the nation’s largest sources of affordable housing. In recent months, Prosperity Now has worked with these House offices and we are very appreciative of their commitments.
The new HUD program would fund grants up to $1 million per park or $20,000 per unit, whichever is less. While open to for-profit operators of parks, the limits on rent increases, the affordability commitment and the requirement to keep the community operational for 20 years will appeal mostly to cooperatives, nonprofits, tribal entities and local governments. The bill will encourage new housing organizations to preserve communities and will incentivize for-profit operators to act in the interest of their residents.
The housing crisis in the Bay Area is well known. Alameda and Santa Clara Counties, parts of which are in Rep. Khanna’s district, have some of the highest housing costs in the United States. What is less known is the how important manufactured housing is in the region. There are about 60 manufactured and mobile home communities in the city of San Jose alone, including some very large parks where residents are now living in fear of displacement.
Iowa’s third district, which Rep. Axne represents in the House and extends from Des Moines to Council Bluffs, has also been in the news because of manufactured housing. Havenpark Capital Partners, the now-notorious Utah-based community owner, bought a park in Waukee and then raised lot rents 69%, a striking increase regardless how the firm tried to justify it.
The program makes sense for several reasons. First, the federal government, since the Great Recession, has finally recognized the importance of mainstreaming manufactured housing. While it is still too often on the periphery, manufactured housing is prohibited in residential zones in some localities and is excluded from some mortgage programs, for example, recent federal actions have raised the sector’s profile. The Housing and Economic Recovery Act of 2008 mandates that Fannie Mae and Freddie Mac serve the financing needs of the manufactured housing market. The Department of Agriculture’s 502 program includes two innovative pilot programs to assist manufactured home buyers. USDA’s Rural Energy Savings Program can now be used to replace older homes with highly efficient manufactured homes. Finally, the 2020 federal appropriations bill includes language, originally in the bipartisan S. 1804 and H.R. 926, requiring HUD to develop guidance for recipients of federal housing funds to include manufactured housing in their consolidated planning processes, a low-profile, but potentially dramatic change to how this housing is seen in local communities.
Each of these programs would work better, and its impact leveraged, by the adoption of the Manufactured Housing Community Preservation Act. Fannie and Freddie’s lending partners would be better positioned to lend in preserved communities, and USDA’s programs could get traction for the same reasons. Communities, through their consolidated planning processes, would identify preservation opportunities that would cost tens of thousands of dollars less than traditional affordable housing preservation programs.
This is an unrivaled opportunity for the field. There has been bipartisan support for manufactured housing bills in recent years, and there is no reason H.R. 5547 should not attract interest from both parties in both houses of Congress.
Want to support this initiative? Email your rep to help preserve manufactured housing communities! We also encourage you to join our I’M HOME Network to help us raise the visibility of manufactured housing as well as our Affordable Homeownership Advocacy Campaign to advance our vision of ensuring everyone in our country has a clear path to homeownership.