Issue link: https://read.dmtmag.com/i/140471
HUD Program Budget Should Increase SAA Funding As Congress works on a potential 2014 federal budget, the Manufactured Housing Association for Regulatory Reform (MHARR) has communicated with the HUD appropriations subcommittees in both houses and has responding to specific questions regarding aspects of the proposed 2014 HUD manufactured housing program budget. While the program budget, under much closer congressional scrutiny in recent years, has declined substantially from the $14 million requested by regulators as recently as 2011, the 2014 HUD request of $7.53 million nevertheless represents an increase of more than $1 million over the $6.5 million funded in 2012 (albeit slightly less than the $8 million requested in 2013). As part of this total, HUD is seeking a direct appropriation of $1 million – a reduction from the $2.5 million direct appropriation authorized in 2012 – but has indicated that in 2014 it will propose an increase in the label fee from the current $39 per section, to $100.00 per section. Responding to congressional inquiries regarding the overall budget and specifically the proposed label fee increase, MHARR has been consistent in maintaining that the issue is not whether the label fee should be changed, but what is done with that additional revenue based on relatively low industry production levels. Thus, MHARR has indicated that funding allocations within the program should be closely scrutinized by Congress, as they continue a regulatory model that relies too heavily on contractors – fueling over-reach and regulatory excesses that do nothing to benefit consumers -- while HUD's state partners, the State Administrative Agencies (SAAs), funded through label fee allocations, are starved for operating revenue and face the constant threat of elimination by budgetconscious state governments. Specifically, although the proposed budget reduces funding for the main monitoring contract from $6 million in 2013 to $4 million in 2014, there is no justification offered for maintaining even that level in the face of current production levels. Moreover, the 2014 budget allocates $1.5 million to an installation "inspection and enforcement" contract and $500,000 to a "dispute resolution enforcement" contract with – (1) no assurance that those contracts will be awarded to contractors that are "separate and independent" from other program contractors (such as the monitoring contractor) as required by the Manufactured Hous- ing Improvement Act of 2000; and (2) no justification for the specific amounts requested. This is particularly true for the consumer satisfaction program, where available information indicates that the number of referrals to the HUD-administered federal program have been minimal. By contrast, program funding for the SAAs, under the 2014 proposal, will remain locked-in at the same $3.3 million allocated in both 2013 and 2012, even though the SAAs -- as the firstline of consumer protection and response under the HUD program – and unlike program contractors, are responsible for an ever-growing number of homeowners living in both new and existing HUD Code homes. Accordingly, MHARR has urged Congress (again) to review these allocations and proposed expenditures for their necessity, justification and appropriateness, and more importantly, the need to provide additional funding to HUD's state partners – as planned and intended by Congress in the original 1974 manufactured housing law - while further reducing funding levels for contractors. EPA Publishes Proposed Formaldehyde Standards As MHARR has reported previously, the Environmental Protection Agency (EPA), on June 10, 2013, published long-awaited proposed rules concerning formaldehyde emissions from composite wood products. The two proposed rules would establish federal standards for formaldehyde emissions from certain defined composite wood products, as well as a framework for a third-party certification program for composite wood product producers. The proposed EPA rules are designed to implement the Formaldehyde Standards for Composite Wood Products Act, which was signed into law on July 7, 2010. That law – passed after a coalition of special interest groups petitioned EPA in 2008 to regulate formaldehyde emissions from composite wood products under the Toxic Substances Control Act -- directed EPA to establish federal formaldehyde standards and related enforcement mechanisms for hardwood plywood, particleboard and medium-density fiberboard that are identical to standards already adopted and enforced by the California Air Resources Board (CARB). Under the EPA proposal, enforcement of the new federal standards, at the component supplier level, would begin one year after publication of the final standards rule in the Federal Register. MHARR will now thoroughly review each of these proposed rules for their potential impact on manufactured housing, with a particular emphasis on cost-related issues and potential unintended consequences -- and will submit appropriate comments to EPA on behalf of HUD Code industry manufacturers. Similarly, the MHCC should review these proposed rules to assess their potential impact on manufactured housing and consumers, and submit appropriate comments if warranted. No. 13 on Get It Quick Page JULY 2013 23 THE JOURNAL