Bringing it All Home
OVERVIEW AND INTRODUCTION
Manufactured housing represents the largest stock of (largely unsubsidized) affordable housing in the country. Although often overlooked by both policymakers and affordable housing advocates, an estimated 17 million Americans live in 6.8 million manufactured homes today. These homeowners have an average income of $29,000 and a median age over 50. For these homeowners, many of whom are older adults on fixed incomes, having a manufactured home is what makes homeownership affordable.
In spite of this, manufactured housing is often ignored as a source of affordable housing. Lingering stereotypes associated with manufactured housing prevent many from recognizing its value and potential. In fact, technological innovations and demand for affordable homeownership have moved the factory-built housing industry to produce homes that are permanent, affordable, energy efficient, appreciating assets and indistinguishable from site-built homes. A growing number of manufactured home communities are the site of an innovative ownership structure as homeowners assume community ownership through the creation of limited equity cooperatives, providing increased stability and security while instilling new pride in themselves and their communities.
Yet, the challenges consumers face in the manufactured housing marketplace are many. Poor financing terms and limited tenure stability limit homeowners’ ability to build wealth and self-sufficiency, increasing the likelihood that they will require public subsidies for food or health care. Outdated energy-inefficient manufactured homes waste
natural resources, increase greenhouse gas emissions and absorb a large share of low-income homeowners’ income through high utility costs, increasing the chances that such families will require energy assistance as well.
These issues around manufactured home financing, policy and development should be important to policymakers. The loss of this often-unsubsidized affordable housing stock could lead to increased demand for more publicly subsidized housing. Assuring the preservation of existing manufactured housing, promoting resident ownership of communities, encouraging the development of new, high-quality manufactured housing, and making sure that families have access to fair financing products to purchase affordable manufactured homes is in the long-term best interest of the public sector that is increasingly financially strapped.
MAnuFAcTured HOusIng And THe FuTure OF AFFOrdAbLe HOusIng
AN ACTION AGENDA FOR FEDERAL AGENCIES AND OTHER PARTNERS
Manufactured Housing Units 6.8 Million Units
2.9 million in Communities 3.9 million on Fee Simple Lots
Subsidized Affordable Housing Units 5.7 Million Units
2.5 million LIHTC Units 2 million Section 8 Vouchers 1.2 million Public Housing Units Sources: The American Housing Survey, CFED estimates of manufactured homes in communities and the U.S. Department of Housing and Urban Development
This report outlines four major challenges facing manufactured housing, opportunities to overcome these challenges and actions that can be taken by federal agencies and regulators to help realize the potential of manufactured housing. The four challenges facing manufactured housing outlined in this report are:
1. regulatory barriers prevent affordable housing developers from acquiring the federal support necessary to use manufactured housing for new and replacement development.
2. Less favorable financing terms than site-built homes prevent manufactured homeowners from building wealth.
3. short term lease arrangements and sometimes arbitrary rules and regulations set by community owners limit the security of tenure of manufactured homeowners in land-lease communities.
4. Two million existing manufactured homes were built before the 1976 Hud code, many of which are energy inefficient, unsafe and unhealthy for their residents.
surprisingly, many of the solutions outlined in this report only require that policymakers and regulators treat manufactured housing the same as site-built housing. There is good reason for federal policymakers to look to manufactured housing as a scalable platform for the delivery of new affordable housing. With continuing transformation efforts that level the playing field for manufactured housing, it has the potential to ultimately become a uniquely sustainable market-based delivery system for affordable housing.
The ideas featured in this report are the product of the research and experience of cFed and core policy- and program-related partners. some of these ideas were presented and discussed as part of a one-day convening entitled Bringing it All Home: Manufactured Housing and the Future of Affordable Housing. You can read more about that event through the convening report located here.
TABLE OF CONTENTS
Creating and Preserving a Unique Affordable Housing Resource ... 4
Challenge 1: regulatory barriers prevent affordable housing developers from acquiring the federal support necessary
to use manufactured housing for new and replacement development. ... 4Opportunity: remove the regulatory barriers that prevent local jurisdictions and community-based housing developers from accessing federal funding to use manufactured housing for new and replacement affordable housing development. ... 4
recommended Actions by Agency ... 4
U.S. Department of Housing and Urban Development (HUD) ... 4
Challenge 2: Less favorable financing terms than site-built homes prevent manufactured homeowners
from building wealth. ... 5Opportunity: Make existing federal single-family financing products available to owners and buyers of manufactured homes. ... 5
recommended Actions by Agency ... 5
U.S. Department of Housing and Urban Development (HUD) ... 5
U.S. Department of Agriculture (USDA) ... 6
Consumer Financial Protection Bureau (CFPB) ... 6
The Federal Housing Finance Agency (FHFA) ... 7
Challenge 3: short-term lease arrangements and sometimes arbitrary rules and regulations set by community
owners limit the security of tenure of residents of land-lease communities. ... 8Opportunity: enhance the economic security of owners of manufactured homes by improving federal support for resident-ownership of manufactured home communities. ... 8
recommended Actions by Agency ... 8
U.S. Department of Housing and Urban Development (HUD) ... 8
U.S. Department of Agriculture (USDA) ... 9
Environmental Protection, Energy Efficiency and Conservation, and Manufactured Housing ... 10
Challenge 4: Two million existing manufactured homes were built before the 1976 Hud code, many of which
are very energy inefficient, unsafe, and unhealthy for their residents. ... 10Opportunity: Assist low- and moderate-income families with weatherization or replacement of outdated housing with manufactured homes that are more energy efficient, safer and healthier. ... 10
recommended Actions by Agency ... 10
U.S. Department of Agriculture, Rural Development (USDA) ... 10
U.S. Department of Health and Human Services (HHS) ... 11
CREATING AND PRESERVING A UNIqUE AFFORDABLE HOUSING RESOURCE
Challenge: Regulatory barriers prevent affordable housing developers from acquiring the federal support necessary to use manufactured housing for new and replacement development.
Opportunity: Remove the regulatory barriers that prevent local jurisdictions and community-based housing developers from accessing federal funding to use manufactured housing for new and replacement affordable housing development.
Today’s manufactured housing offers cost- and energy-savings during the production process and after placement. built to a strict federal code, new manufactured housing is constructed to precise standards that save money and produce minimal waste. The average cost for a manufactured home is $63,000, and 73% of manufactured home households earn less than $50,000 per year. The potential for additional cost efficiencies, increased energy efficiency and better design is aided by ever-evolving technological advances in the manufactured housing production process.
The cost-saving characteristics of manufactured housing make it an ideal source of affordable homeownership in many American communities. In order for affordable housing developers to incorporate this type of housing into their neighborhoods, however, federal funding is often critical to getting these developments off the ground. still, many of the federal funding streams intended to facilitate affordable, sustainable housing development include regulatory stipulations that make it harder for affordable housing developers to use that funding to facilitate manufactured housing development or replacement. The following recommendations focus on opening up federal funding sources to better serve practitioners in the field that use manufactured housing in replacement and development work.
Recommended Actions by Agency
U.S. Department of Housing and Urban Development (HUD)
Community Development Block Grants (CDBG): This program provides communities with resources to address a wide
range of unique community development needs. The cdbg program provides annual grants on a formula basis to 1,209 general units of local government and states.
Action: Issue guidance or an interpretive letter stating that the CDBG 1:1 replacement rule applies to all dwellings including manufactured homes, both rental and owner occupied, whether classified as real or personal property.
Action: Revise the “Guide to National Objectives & Eligible Activities for Entitlement Communities” and other materials to highlight the use of CDBG funding to purchase and preserve manufactured home communities by enabling the community residents, affordable housing nonprofits or public housing authorities to acquire the land. Revise this guide to highlight the use of CDBG for community infrastructure improvement in cooperative-owned manufactured home communities and develop national guidance to promote these uses.
HOME Investment Partnerships Program: HOMe provides grants to states and localities that communities use – often in
partnership with local nonprofit groups – to fund a wide range of activities that build, buy and/or rehabilitate affordable housing for rent or homeownership or provide direct rental assistance to low-income people.
Action: Update the regulations which govern the Consolidated Planning process to require that participating jurisdictions – particularly those applying for HOME funding – identify and address any barriers to the use of manufactured housing in programs that provide affordable housing to low- and moderate-income families and affirmatively work to remove all regulatory barriers that would impede the use of manufactured homes in affordable housing development.
next step™ is a social enterprise whose mission is to build a national distribution system to deliver high quality, energy-efficient, factory-built housing at scale. This allows nonprofits to help homeowners achieve wealth by growing equity, preserving assets and replacing substandard mobile homes with new energY sTAr homes. next step™ is taking the innovative and transformative manufactured housing strategies of Frontier Housing – a 35-year-old, nonprofit affordable housing developer in eastern Kentucky – to national scale. Another strategic ally in this social enterprise is clayton Homes, the leading home manufacturer and largest homebuilder in the nation. This unprecedented public-private partnership creates a new market dynamic that will make it easier for more low-income families to achieve homeownership.
Action: Issue a statement demonstrating their support of the use of manufactured housing in affordable housing strategies and issue updated guidance on the use of manufactured homes in programs funded under the HOME Program.
Action: Update existing advisories on HOME funds used in manufactured home communities, since they currently do not reflect the prevailing system of limited equity cooperative resident ownership in the United States.
HUD Consolidated Plan: Hud requires state and local governments to produce a five-year consolidated Plan and annual
action plan to receive funds from the community development block grant (cdbg), emergency shelter grant (esg), HOMe Investment Partnerships Program (HOMe) and Housing Options for People with AIds (HOPWA) formula grant programs. The five-year plan must include an analysis of low-income housing needs, the needs of homeless persons and special needs populations, and the local housing market.
Action: Issue a statement in the “overall goals” section (Section A) of the Consolidated Planning regulations supporting the use of manufactured housing in affordable housing development. Inherent in this support is recognition of manufactured housing as residential real estate, not commercial real estate or personal property.
Other recommended Hud Actions:
Action: Conduct research on the use of first-time homebuyer programs with manufactured housing.
Challenge: Less favorable financing terms than site-built homes prevent manufactured homeowners from building wealth.
Opportunity: Make existing federal single-family financing products available to owners and buyers of manufactured homes.
Traditionally, single-family financing for manufactured homes is disadvantageous to homebuyers and owners. unfair or inaccurate underwriting and unreasonable, predatory loan terms often prevent owners of manufactured homes from building wealth through homeownership. The type and quality of single-family financing available to manufactured homeowners depends greatly on whether the home is classified as real or personal property; personal property financing typically offers shorter terms, higher interest rates and fewer consumer protections than single-family mortgage financing. because the federal government provides several financing and mortgage insurance options that serve manufactured housing, they have some control over the availability of safe and secure financing products for manufactured home buyers, even though the classification of manufactured housing as real or personal property is a state issue.
A vital and competitive refinance and resale market is integral to the success of the site-built home market and is equally significant
for the manufactured home market. Federal agencies have an important role to play in supporting a better single-family financing system that allows purchase, resale and refinance of manufactured housing through legislation, policy, programs and products. Listed below are some suggested regulatory and agency actions that federal agencies can take that would help to build better single-family finance options for manufactured housing.
Recommended Actions by Agency
U.S. Department of Housing and Urban Development (HUD)
The FHA Title 1 and Title 2 Loan Guarantee Program: This program insures private lenders against loss on loans they
make. Hud has approved Title 1 and Title 2 lenders; Hud itself is not the lender. The applicant must have a good credit history and the ability to repay the loan in regular monthly payments. Title 1 loans are for the houses only; Title 2 loans are for a house and land.
Action: Remove the prohibition in the Title I regulations against financing manufactured homes that have been relocated, so long as the home is in good condition and was properly installed.
“When a [manufactured] home
is done right every single time
on the right foundation, providing
comprehensive homebuyer support and
with the right financing, you can create
an opportunity for that asset class and
loan to perform identically to its site
built cousin.”
Action: Require identical manufactured housing foundation standards for Title 1 and Title 2 loans. Currently, the two Titles specify different standards.
Other recommended Hud Actions:
Action: Conduct and/or support additional research to support the anecdotal evidence that responsible manufactured housing lending has low default and delinquency rates and conduct and/or support additional research on scalable mortgage insurance. Action: Research changes to Ginnie Mae’s policy of requiring a ten percent risk reserve; this requirement limits the number of
lenders.
Action: Publicize research showing manufactured home price appreciation in certain circumstances and conduct additional research on the circumstances that lead to manufactured home price appreciation.
U.S. Department of Agriculture (USDA)
Section 502 Direct and Indirect Loans: section 502 loans are primarily used to help low-income individuals or households
purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities. direct loans are loans issued by usdA, indirect loans are loans issued by private lenders where usdA serves as the insurer.
Action: Severe reductions to the Section 502 Direct program will reduce or freeze lending to buyers of manufactured homes. The USDA’s own research finds that RD 502 Direct is better than the RD 502 Guarantee program at delivering sustainable and affordable home mortgage financing to households in high-poverty and rural areas. Restore full funding to the 502 Direct program. Action: Currently the loan term limit for manufactured housing is 30 years. At the same time, limits for site built housing are 33
or 38 years depending on family income. New manufactured homes perform the same or better than site-built homes and should have the opportunity for the same long terms of up to 38 years.
Action: This program only allows loans to finance new construction. Therefore, subsequent purchasers of manufactured homes cannot qualify for USDA loans unless the original loan was with USDA, which does not create an efficient mortgage market and constrains mobility, resale values and household financial security. USDA should follow the FHA example by allowing subsequent purchasers to qualify for these loans subject to standards for the home and the buyer.
Action: There are no uniform requirements for home standards. Each state is allowed to decide what type of foundation system, roof pitch, front porch and any other home standard is required in their respective state. USDA should specify a single foundation standard, identical to the FHA foundation requirement for homes outside of communities with fee simple mortgages.
Action: In many states, USDA only provides loans for multi-section homes. USDA loans should be eligible for single-section homes in all states.
Action: Expand use to include 502 Direct loans for new homes in cooperatives.
Section 504 Direct Loans: rural Housing repair and rehabilitation Loans are funded directly by the government. These
funds are available to very low-income residents living in non-metropolitan areas. The objective of the program is to help very low-income owners of modest single-family homes repair those homes. Loan funds are available to improve or modernize a home, make it safer or more sanitary, or remove health and safety hazards.
Action: Investigate why 504Direct Loans are not working consistently across all communities. USDA should investigate why 504 is not working in some communities.
Consumer Financial Protection Bureau (CFPB)
Title X of the dodd-Frank Wall street reform and consumer Protection Act establishes the bureau of consumer Financial Protection within the Federal reserve. The new bureau regulates consumer financial products and services in compliance with federal law.
Action: Prohibit steering of manufactured home buyers into disadvantageous personal property chattel loans. The CFPB has the authority to adopt regulations under the Truth in Lending Act, 15 U.S.C. § 1639b, to prohibit mortgage originators from steering consumers into disadvantageous residential mortgage loans.
Action: Apply general mortgage protections to manufactured home financing and eliminate disparities between the treatment of manufactured home credit and credit for purchase or sale of site-built homes. The CFPB should clarify that all homes classified as real property are covered by RESPA (an omission in current regulations).
Action: Apply high-cost loan protections whenever manufactured home financing exceeds the appropriate threshold, without any special exceptions. Some protections under the Truth in Lending Act apply only to credit that exceeds a certain APR threshold. Because so many manufactured home purchases are financed through higher-cost personal property loans, many are likely to be subject to these special restrictions. The CFPB should not make any special exceptions for manufactured home finance, and should not provide a lower APR threshold that would reward the industry for steering borrowers into personal property loans.
Action: Ensure that consumer protection rules apply to manufactured home transactions. Because manufactured homes have characteristics of both real property and personal property, they need the consumer protections that are designed for both types of property.
The Federal Housing Finance Agency (FHFA)
FHFA is an independent federal agency created as the successor regulatory agency resulting from the statutory merger of the Federal Housing Finance board (FHFb), the Office of Federal Housing enterprise Oversight (OFHeO) and the u.s. department of Housing and urban development government-sponsored enterprise mission team, absorbing the powers and regulatory authority of both entities, with expanded legal and regulatory authority, including the ability to place government sponsored enterprises (gses) into receivership or conservatorship.
Action: Study and implement actions that will result in a greater number of Community Development Financial Institutions (CDFIs) utilizing the Federal Home Loan Banks Affordable Housing programs.
Action: The Duty-to-Serve proposed rule focuses on GSEs’ existing core business activity. Excluding all new activities goes against the intent and purpose of serving underserved markets. FHFA should take a broad view of which “new activities” will be allowed under Duty to Serve, and also include preexisting pilot products such as Fannie’s MH Select and Freddie Mac’s Lease Purchase Plus. Action: FHFA can foster enterprise activity that promotes conventional lending on manufactured housing, including in states that
lack titling conversion statutes and in circumstances that provide for consumer protections, such as in resident-owned communities. Action: The Duty-to-Serve recognition of the shortage of financing in the manufactured housing segment of the market
underscores the importance of this rule. The FHFA should include assistance to manufactured housing communities within the duty-to-serve final rule.
Action: Develop and promulgate simple rules to help GSEs determine the conditions under which manufactured home community lending will fall within Duty to Serve. These rules (covering resident ownership, long-term security of tenure and other such provisions) should also be drafted as elements to a standard or model lease, pre-approved by the GSEs and FHFA.
Action: FHFA can facilitate and promote GSE activity within the resident-owned community multi-family market via stipulations embedded in Duty to Serve.
Action: Monitor the annual Community Lending Plans and Affordable Housing Advisory Councils of each of the 12 Federal Home Loan Banks to ensure that manufactured housing is included in each plan and manufactured housing investments are reviewed and profiled by each Council.
Action: Duty-to-Serve should require each GSE to encourage limited-equity cooperative ownership of manufactured home communities by developing loan products that enable residents to purchase their communities.
Action: Create a community economic development program analogous to the Affordable Housing Program for the Federal Home Loan Banks.
Action: Implement the Housing and Economic Recovery Act of 2008 and provide a public use database for affordable housing and community economic development investments of the Federal Home Loan Banks.
Challenge: Short-term lease arrangements and sometimes arbitrary rules and regulations set by community owners limit the security of tenure of residents of land-lease communities.
Opportunity: Enhance the economic security of owners of manufactured homes by improving federal support for resident-ownership of manufactured home communities.
resident ownership is the ultimate consumer protection. by purchasing their communities, homeowners acquire control over their site rents, community operations and, most importantly, the land beneath their homes. rOc usA® is a nonprofit social enterprise that identifies communities for sale, trains and certifies local community-based organizations to assist homeowners’ associations through the purchase process, and provides a specialized source of financing for community purchase. Homeowners’ associations that work with rOc usA® create a limited equity cooperative whereby every resident owns a share of the community and builds equity in the community by repaying the loan each month.
residents who own their communities can more easily invest in their communities through infrastructure enhancements, and with increased control over the stability of their homes and communities, often feel more prideful, engaged, empowered and self-sufficient.
Many obstacles make resident ownership a challenging endeavor, including the task of organizing homeowners, piecing together the multiple funding sources needed for the purchase and
building the capacity for self-governance. There are several federal agencies that already administer programs and policies that could easily be tweaked to better serve manufactured home community residents seeking to purchase the land beneath their homes. several ideas for how federal programs and policies could be improved to enable resident ownership are listed below along with additional ideas for assisting this process of conversion.
Recommended Actions by Agency
U.S. Department of Housing and Urban Development (HUD) The FHA Title 1 and Title 2 Loan guarantee Program: This program insures private lenders against loss on loans they make. Hud has approved Title 1 and Title 2 lenders; they are not the lenders. The applicant must have a good credit history and the ability to repay the loan in regular monthly payments. Title 1 loans are for the houses only; Title 2 loans are for a house and land.
Action: Allow the use of Title II on homes in certain land-lease communities by amending the regulation’s leasehold provisions to include a situation where the homeowners have security of land tenure by virtue of membership in the association or cooperative that owns the land.
The FHA 207M Mortgage Insurance Program: This program insures lenders against loss on loans used to finance the
development of new manufactured home communities or to upgrade older ones. community owners and developers can obtain financing through a combination of fixed-rate construction and permanent loans with terms of 30 to 40 years. Funds are not to be used for the purchase of homes.
Action: Remove the burdensome restrictions on subordinate financing and permit buyers, particularly nonprofit resident cooperative buyers, to secure subordinate financing from a state or local government or nonprofit CDFI lenders. This will enable homeowners to access the 90 percent insurance product typically afforded commercial investors, especially in those resident-owned cooperatives wherein 75 percent of owners earn less than 80 percent AMI.
I’M HOMe has supported the creation of a national social venture, rOc usA® to help homeowners who rent their home sites in manufactured home communities achieve long-term stability by purchasing their communities as cooperatives. The rOc usA® model is based on a 26-year proof of concept in new Hampshire, where the new Hampshire community Loan Fund has converted 20 percent of the state’s communities to resident ownership, improved community infrastructure, and created a single-family loan program exclusively for those communities. rOc usA’s model for supporting local technical assistance providers around the country – there are 10 affiliated nonprofits in rOc usA network – includes a standardized model of development, transaction coaching, and peer-to-peer learning and collaboration. resident Ownership capital, LLc, a rOc usA subsidiary and certified community development Financial Institution (cdFI), provides low-income resident co-ops with specialized purchase financing.
ROC USA® is a networked social venture launched by CFED, NCB Capital Impact, and the NH Community Loan Fund as Members, with support from
NeighborWorks® America, the Ford Foundation, Fannie Mae, Bank of America, Enterprise, and The F.B. Heron Foundation.
Action: Revise and substantially update this program, starting with the application process. Instead of a traditional process, applications should be reviewed using the more accelerated MAP Process (Multifamily Accelerated Processing). That process, with its built-in timeline and deadlines, will ensure that applications are reviewed in a timelier manner.
Section 213 Mortgage Insurance for Cooperative Housing: This program insures mortgage loans to facilitate the
construction, substantial rehabilitation and purchase of cooperative housing projects. each member shares in the ownership of the whole project with the exclusive right to occupy a specific unit and to participate in project operations through the purchase of stock.
Action: Modify such that it can be used in manufactured home communities where the community is cooperatively owned and the homes are individually owned, as long as the Borrower owns the home and the share will entitle them to a proprietary lease for the site it is located on.
Action: Streamline the process for using Section 213 by creating pre-approved template documents for these conversions to keep the costs low and prevent them from becoming barriers for conversion to resident ownership.
Action: Review and clarify the definitions to ensure that manufactured housing communities, including limited-equity housing cooperatives, are eligible, because in low-income communities the preferable method is to use subordinated debt to keep the share value low and establish the share as limited or zero equity.
Community Development Block Grants (CDBG): This program provides communities with resources to address a wide
range of unique community development needs, including affordable housing development. The cdbg program provides annual grants on a formula basis to 1,209 general units of local government and states.
Action: Revise the “Guide to National Objectives & Eligible Activities for Entitlement Communities” and other materials to highlight the use of CDBG funding to purchase and preserve manufactured home communities by enabling the community residents, affordable housing nonprofits or public housing authorities to acquire the land. Revise this guide to highlight the use of CDBG for community infrastructure improvement in cooperative-owned manufactured home communities and develop national guidance to promote these uses.
HOME Investment Partnerships Program: HOMe provides grants to states and localities that communities use – often in
partnership with local nonprofit groups – to fund a wide range of activities that build, buy and/or rehabilitate affordable housing for rent or homeownership or provide direct rental assistance to low-income people.
Action: Update existing advisories on HOME funds used in manufactured home communities, since they currently do not reflect the prevailing system of limited equity cooperative resident ownership in the United States.
Neighborhood Stabilization Program Funds (NSP): The nsP was established for the purpose of stabilizing communities
that have suffered from foreclosures and abandonment. Through the purchase and redevelopment of foreclosed and abandoned homes and residential properties, the goal of the program is being realized. grants are provided to all states and selected local governments on a formula basis.
Action: Provide guidance on the use of remaining NSP funds in manufactured housing communities. U.S. Department of Agriculture (USDA)
Section 502 Direct and Indirect Loans: section 502 loans are primarily used to help low-income individuals or households
purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities. direct loans are loans issued by usdA, indirect loans are loans issued by private lenders where usdA serves as the insurer.
Action: In many states, USDA only provides loans for multi-section homes; make USDA loans eligible for single-section homes in all states.
Water and Environmental Programs (WEP): These programs provide loans, grants and loan guarantees for drinking water,
sanitary sewer, solid waste and storm drainage facilities in rural areas and cities and towns of 10,000 or less. Public bodies, nonprofit organizations and recognized Indian tribes may qualify for assistance. WeP also makes grants to nonprofit organizations to provide technical assistance and training to assist rural communities with their water, wastewater and solid waste problems.
Action: Better publicize and support the success of these loans in cooperatives.
Rural Cooperative Development Grant Program (RCDG): These grants are made for establishing and operating
centers for cooperative development for the primary purpose of improving the economic condition of rural areas through the development of new cooperatives and improving operations of existing cooperatives.
Action: Better publicize and support the technical assistance centers in RCDG.
ENVIRONMENTAL PROTECTION, ENERGy EFFICIENCy AND CONSERVATION, AND
MANUFACTURED HOUSING
Challenge: Two million existing manufactured homes were built before the 1976 HUD Code, many of which are very energy-inefficient, unsafe and unhealthy for their residents.
Opportunity: Assist low- and moderate-income families with weatherization or replacement of outdated housing with manufactured homes that are more energy efficient, safer and healthier.
An estimated two million manufactured homes were constructed prior to the 1976 Hud code. While some of this housing has been well maintained and is in good condition, many are not energy-efficient and some pre-1976 homes present health and safety hazards. unfortunately, there is currently a lack of data on these homes, the homeowners that live in them and the extent to which energy is wasted due to the quality of outdated units. Today, we have anecdotal evidence that replacement of older
manufactured housing leads to significant reduction in energy consumption, but more data is needed on exactly how much energy could be saved by replacing these homes with new, high-quality, energy-efficient manufactured homes.
Throughout the country, a significant amount of money is spent on programs that assist low-income households with their utility bills at the state and local level. At the federal level, the Low Income Home energy Assistance Program (LIHeAP) administered by the u.s. department of Health and Human services spends 4.5 billion dollars annually assisting families with their utility bills. some of this money is spent heating and cooling outdated energy inefficient manufactured housing units. In a time of federal fiscal constraints and concern about climate change, a real discussion is needed as to whether an approach that creates long-term value and savings through weatherization and replacement programs makes more sense than continuing ongoing payments to homes that are wasting energy and creating additional greenhouse gas emissions.
Other environmental issues surrounding manufactured housing include communities with poor infrastructure which leads to a host of environmental problems both for the residents and for the surrounding community. Poor water quality, failing septic systems and wasteful and dangerous distribution systems are sometimes found in manufactured housing communities, many of which are not served by local utilities.
While the solutions to these problems involve local, state and federal involvement, listed below are actions that could be taken at the federal agency level without legislative approval that would assist with energy efficiency and conservation and environmental protection.
“Produced in one-fifth the time and
at half the cost of site-built homes,
manufactured housing assembled in
a controlled, factory environment uses
fewer materials and generates
35%-40% less waste than comparable
site-built units.”
– university of Florida school of building construction study: 2006
Recommended Actions by Agency
U.S. Department of Agriculture (USDA)Water and Environmental Programs (WEP): These
programs provide loans, grants and loan guarantees for drinking water, sanitary sewer, solid waste and storm drainage facilities in rural areas and cities and towns of 10,000 or less. Public bodies, nonprofit organizations and recognized Indian tribes may qualify for assistance. WeP also makes grants to nonprofit organizations to provide technical assistance and training to assist rural communities with their water, wastewater and solid waste problems.
Action: Better publicize the success of these loans in co-ops to build support for this successful program.
U.S. Department of Health and Human Services (HHS)
Low Income Housing Energy Assistance Program (LIHEAP): This program assists low-income households,
particularly those with the lowest incomes that pay a high proportion of household income for home energy, primarily in meeting their immediate home energy needs.
Action: Promote the use of LIHEAP funds for replacement of outdated mobile homes.
Action: Conduct additional research on the cost of ongoing LIHEAP expenditures versus replacement of manufactured homes with more energy efficient homes.
U.S. Department of Energy (DOE)
The Weatherization Assistance Program (WAP): This program enables low-income families to permanently reduce their energy bills by making their homes more energy-efficient. Funds are used to improve the energy performance of dwellings of needy families using the most advanced technologies and testing protocols available in the housing industry. Funding is provided to states, u.s. overseas territories and Indian tribal governments, which manage the day-to-day details of the program.
Action: Allow Replacement of pre-1976 mobile homes as an eligible activity under this program and other energy-efficiency programs.
Action: Conduct research on the sale of carbon credits for weatherization or replacement of manufactured housing.
Mrs. Kelly and Frontier Housing
Manufactured Housing Done Right™
Phyllis Kelly is a resident of rural elliot county, KY. In desperate need of decent, safe, affordable housing, in the summer of 2007, Mrs. Kelly called
Frontier Housing. Frontier Housing is a nonprofit affordable housing provider in Kentucky that pioneered the Manufactured Housing Done
Right™ approach that served as a model for Next Step™.
Mrs. Kelly was living with her daughter and granddaughter in a single-wide mobile home built in 1970, before the Hud code set national safety and structural standards in 1976. by 2007, windows and doors leaked air, the water pipes froze in the winter months, the heating system was inadequate, the floor was falling in and the house was cooled by only one small window air-conditioner. At times, her monthly energy usage per month exceeded 6,000 KW/month and her monthly bill exceeded $500 and carried warnings about disconnect dates. The home was served by a homemade septic system; a pipe that connected from the home to a 55 gallon metal drum and then distributed into the soil. The waste visibly leached into the yard. With Frontier Housing’s help, Mrs. Kelly now lives in the energY sTAr® discovery model of Frontier’s ridgeline series of single section manufactured homes. Her energy usage
dropped to 1,600 KW/month and her monthly mortgage payment and utility bill are now less than her electric bill in her previous home. The home has 2x6-inch exterior
walls, efficient heating and cooling equipment, a high efficiency water heater, high performance windows, tight construction and sealed ducts to reduce leaks, drafts, and outdoor noise. soon after the home was replaced, Frontier got a
call from the staff at Mrs. Kelly’s electric company Grayson Rural Electric, GRECC.
Her energy usage had dropped so drastically that the electric company questioned if Mrs. Kelly was still occupying her residence. They sent staff out to investigate, and discovered not a vacant unit, but a larger, newer home.
To read more about Mrs. Kelly, Frontier Housing and Manufactured Housing Done Right, click here.
