Fitzsimon File

Need another example of how out of whack state priorities are in North Carolina when it comes to folks who don’t have much money? Tuesday’s meeting of the state’s Manufactured Housing Board could be a case study.

The Board voted down a proposal that would have protected consumers buying a mobile home from losing their deposit if the company went out of business. That means that companies can continue to use deposit money to pay utility bills or any other expense and the consumer loses the deposit if the company goes under.

The General Assembly passed legislation in 2003 ordering the Manufactured Housing Board to come up with rules to protect the deposits, but a result of pressure from industry lobbyists, the phrase “to the extent practicable” was included in the new law.

That apparently was enough leeway for the six of nine members of the Board with close ties to the mobile home industry. They voted against a proposal to require companies to establish escrow accounts for the money.

You might be wondering why two-thirds of a regulatory body in effect comes from the very industry the board oversees. That’s the way the law is written. The Governor, Speaker of the House, and the President Pro Tem of the Senate appoint the board, but the appointments are prescribed by law to come from specific parts of the industry. Only two of the members are public representatives.

The law that prescribes the composition of the board is a testament to the power of the manufactured housing lobby. It is a giant business in North Carolina. Roughly 16 percent of the population lives in manufactured housing and almost 4 in 10 new home starts in the 1990s were manufactured homes.

Losing deposits isn’t the only problem folks face. Mobile homes are regulated by the federal government, but modular homes are not. Folks who sell some modular housing are not even licensed and manufactured housing rarely appreciates.

The appeal of course is that the housing is cheap and allows people to buy a home who cannot afford to buy a convention house. But the industry must be regulated and protecting deposits ought to be a no brainer.
Another easy call ought to be to confront the manufacturing housing lobby and its campaign contributions and change the composition of the Manufactured Housing Board to balance the interests of consumers and the industry.

And as for helping folks find affordable housing, increasing the funding for the Housing Trust Fund remains the best option. The Trust Fund provides low-interest loans for developers so they can build housing that more people can afford. Trust Fund money creates jobs, investment, and helps people find a decent place to live.
Currently, the Housing Trust Fund gets only $3 million a year. Fifty million dollars a year ought to be the goal.

Another rule of thumb ought to be to always protect the interests of consumers, regardless of what the industry lobbyists think.

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This entry was posted on Wednesday, January 19th, 2005 at 10:44 pm and is filed under Fitzsimon File. You can follow any responses to this entry through the RSS 2.0 feed.