Friends of Manufactured Housing
This site is dedicated to information and opinion about manufactured housing community issues, particularly in Washington State.
Email at RGCinSpokane@gmail.com
In the News
Threats to property rights re-emerge in twin bills: HB1129 and SB5198
This 2023 session in Olympia brings back a proposed 3-year closure notice period, AND a burdensome “Opportunity to Purchase” process that can impose at least a 1-year halt of any sale of your manufactured housing community property.
Both bills invade privacy by demanding notice be sent to tenants and government if you privately decide tell let others know your park is for sale.
These bills pose a taking argument, violation of constitutional rights, by giving private people authority to occupy your land against your wishes, and by imposing unduly oppressive burdens on the landowner to help solve society’s shortage of affordable housing.
Read the house bill for yourself: https://lawfilesext.leg.wa.gov/biennium/2023-24/Pdf/Bills/House%20Bills/1129.pdf?q=20230121100633
How and When Should Gov Intervene in the Business of Mobile Home Parks?
Currently, and for the last decade or more, there are demands that laws be changed to force landlords of manufactured housing communities to accommodate and facilitate the sales of their real estate to the tenants who reside there. The motive is to help preserve a form of housing that appears to be in decline.
And, for manufactured housing communities that must be closed for any of a myriad of reasons, there are demands that these imminent closures be delayed for years beyond the current 12-month requirement.
These demands made by tenant advocates and legislators are colored in large part by the overall housing shortage we face in this state. Estimates are the state is lacking at least 300,000 households to meet demand. The shortage of available housing, and lack of places to relocate manufactured homes, exacerbates the challenges people face when a manufactured housing community needs to close.
Brief background
Mobile home parks, or trailer parks, began as ad-hoc communities to help meet the demand for housing after World War II. Soon they became a popular option for people wishing to economize in their households.
Today, manufactured housing communities are more often well-designed self-contained neighborhoods where people share a common bond and pride of place.
The business model employed is to rent small parcels of land to people who purchase a type of home that is moveable and relocatable. The homeowner owns their home and they rent the land it is placed on. The concept acknowledges from the start that the arrangement is not permanent.
Here in Washington, since 1977, a separate landlord-tenant act has been in place to help govern the relationship between homeowner-tenants and the property owner. There has always been a concern about preventing an arbitrary and sudden demand to remove a mobile or manufactured home from the rented land. Therefore, in all agreements required since then, before a mobile home is even allowed on the premises, there is language disclosing the fact that only under certain circumstances the tenant’s home may be required to exit the community.
Moving a mobile or manufactured home has always been an expensive job, but it has never been prohibitive. The homeowner who brings a manufactured home into a land-lease community is immediately aware of the costs to transport and set up the home for habitation.
And that first time homeowner-tenant will have in mind that they sure don’t want to have to move it again soon. Under normal expectations, that day to relocate a freshly-placed manufactured home will be many years or several decades away.
Since 1989, the very lease a homeowner must sign to rent a lot in a community contains a bold print statement that either the community will not change land use for a period of three years, or a statement that the community may be sold or otherwise transferred at any time perhaps resulting in a closure of the community after the required notice period.
So for a tenant going in, there is no false allusion that a manufactured home is to be considered anything other than temporary or semi-permanent upon the rented lot. And, the law has assurances that no arbitrary and sudden demands to remove the home from the premises can be made.
NEed for More intervention?
Who should shoulder the burden if the government decides to intervene to aid homeowners who face what are often predictable challenges of packing up belongings and relocating their homes from communities that close?
In this 2023 legislative session, there are bills proposed that again put the entire burden on the landlord who is either selling their property, or who is having to close down their manufactured housing community.
In one scenario proposed, addressing a closure of a community in 12-months, the landlord is required to pay out to all of her tenants nearly the equivalent of the entire value of her manufactured housing community.
The formula demands payment equal to the market value of each of their manufactured homes plus what amounts to two and half times the rent paid for the past two years in the form of a “relocation assistance payment”. And after receiving these sums, the tenants still own their homes.
For a landlord contemplating a 12-month closure, this radical payout “option” is really not a practical choice, but is meant as a malicious deterrent to keep a landlord from making such a choice in the first place.
The drafters of these current bills appear to believe that only the individual landlord is responsible for the challenges faced by homeowner-tenants in the event of a sale of the property or the closure of the manufactured housing community.
To quote the Washington Supreme Court in 1993: “The cost of relocating mobile home owners, like the related and more general problems of maintaining an adequate supply of low income housing, are more properly the burden of society as a whole than of individual property owners. While the closing of a mobile home park is the immediate cause of the need for relocation assistance, it is the general unavailability of low income housing and the low income status of many of the mobile home owners that is the more fundamental reason why relocation assistance is necessary. An individual park owner who decides to close a park is not significantly more responsible for those general society-wide problems than is the rest of the population. Requiring society as a whole to shoulder the costs of relocation assistance represents a far less oppressive solution to the problem.”
Past Interventions
The state government can shoulder a burden to help homeowners far easier than any one individual community owner. And yet, in the past 20 years, most solutions identified and put into law set the burden squarely on landlords of these communities. The government, or society, is never asked to chip in, except to perform some regulatory function.
Thirty years ago, a mobile home relocation program was put into law that required the landlord to pay all costs to move mobile homes out of a closing manufactured housing community. The law was struck down by the courts.
To replace the program, funding was gathered from homeowners each time their homes sold and changed hands. This was largely inadequate for the task in some years. Recently, landlords have been required to chip in $5 per lot annually to operate the relocation coordinator’s office, but not the actual relocation program.
The legislature then deemed it necessary to establish a dispute resolution program for tenants and landlords of manufactured housing communities. Funding was gathered solely from landlords at $10 per home lot per year. The landlord was allowed to collect a maximum of $5 from each tenant if they went to the trouble, but the state would not seek funding from the homeowners directly.
Now granted, long-term solutions that address problems commonly faced should probably be paid for by the “users” of whatever the situation is. Drivers seem to agree that paying registration fees on cars to pay for roads is an acceptable burden. So too the participants in the landlord-tenant arrangement of land-lease communities see reason in these small specific programs.
(However, most people would say it would be unfair if only car owners in a specific town were required to pay for the entire cost of replacing a bridge on a state highway near them. These costs are normally shared equally by all across the state.)
Another directive from 30 years ago required landlords to sell their manufactured housing communities to their tenants if the tenants had, in advance, formed a group and expressed interest in buying. There was no choice— the landlord had to set aside time to close a deal, had to negotiate with the tenant group, and could not sell to a third party for a lower price. This program was intended to help preserve existing manufactured housing communities at risk of converting to other uses. (At the time, many of the early ad-hoc trailer parks and mobile home parks were becoming obsolete in the eyes of city officials and property owners.)
This right of first refusal law was struck down by the courts. It was determined that the state constitution has a strict prohibition on the government taking private property for others’ private use. The private right to keep, enjoy and sell property was diminished so that private homeowners could benefit.
In all of these cases of the government intervening to help homeowners in communities, the legislature has put the burden solely on the landlords. In the two cases of unduly oppressive burdens, the courts ruled it was unfair or illegal.
To re-cap, a homeowner in a manufactured housing community is reminded each year that the rental of land arrangement can change if the community is sold or closed.
Many current homeowners express worry that if their community is sold, it would only be for the purpose of closing. The required phrase in the lease can be blamed for this misunderstanding even though the reality is that most sales result in continued operation of the community.
The required lease language: “The park may be sold or otherwise transferred at any time with the result that subsequent owners may close the mobile home park, or that the landlord may close the park at any time after the required closure notice as provided in RCW 59.20.080.”
An informed tenant will understand that there is a possibility, however unlikely, that the cost of moving and relocating their manufactured home will be a burden they will have to take. They may also understand that there is a state program in place to help defray costs and help with logistics.
The original tenant who had their manufactured home hauled in to a manufactured housing community knew they had a responsibility to remove the home at some point in the future when required. Subsequent tenants who buy the home in place should be aware, but often are not, that the responsibility to remove the home when required came with the purchase of the home.
Sudden and arbitrary demands to remove and relocate a manufactured home have been virtually eliminated from all possibilities over the years. This now includes the circumstance of eviction for non-payment of rent— after judicial order of eviction, the tenant is allowed time to sell their home in place, resulting in the land owner never getting full use and possession of the premises back.
Knowing all this, we must ask, “How and when should the government intervene and shoulder the burden to aid homeowners faced with relocating their homes when external circumstances exacerbate the severity of the challenges involved?”
The shortage of available housing is an external problem. The lack of significant development of new manufactured housing communities for work-force housing or middle and low income families is an external problem. Prejudicial building codes and zoning preventing the placement of manufactured homes in the same locations as any other housing is an external problem.
Some Solutions
We can easily imagine solutions where the government can put their vast resources to work to help.
To help solve the shortage of housing and lack of new development of manufactured housing communities for work-force housing and middle and low-income families, the state can literally build new manufactured housing communities and rent the lots to homeowners or install homes and rent the homes to tenants.
To help buy time for homeowners experiencing a manufactured housing community closure, the government can use its resources of land to temporarily store tenants’ homes while relocation destinations are determined, or to allow tenants time to market their homes to new buyers elsewhere.
At the same time, the government could issue grants to help tenants store their household belongings during any interim period. This would be in addition to any relocation program funding available to the tenants.
Relocation funding could be bolstered by matching funds from the state to make sure the goals of the manufactured home relocation program do not fall short.
Another strategy to help buy time for homeowners to plan for relocation would be for the state to grant landlords $500 per home lot per year for extending a community closure to 2 years instead of the current 12-month closure period. (If indeed the landlord could financially survive the extended period at all.)
Back in the days of the right of first refusal law, tenants were required to be organized first, and to express an interest in buying their community one day. Though the law has been invalidated, the concept of being prepared ahead of time can still benefit tenants.
Just like anyone in the real estate market, tenants need to be ready to pounce at the opportunity to purchase their community if and when it comes up for sale. In order to act as fast as any other potential buyer, the tenants need to be informed and educated on how to become a legal organization capable of executing purchase contracts. Tenants need to be proactive and form a tenant association of some sort and have an action plan in place, if there is a desire of the majority of tenants to become a resident-owned community.
Therefore, the government could approach and evaluate every manufactured housing community in the state to help tenants determine the need, desire, practicality, and procedure of forming a group to buy and operate their own community.
As landlords come to a decision to sell their manufactured housing communities, the ordinary process of selling real estate would not be interrupted or cause hardship to the property owner. A tenant group that was organized ahead of time could take timely action to draft and present an offer on the property, as any other interested third party would.
In this scenario, an organized tenant group would not appear adversarial, and would not cause risk of lawsuit or disruption of estate pre-planning for the landlord. As is the case now, an incentive for the landlord to sell to the tenant group would be a savings on the excise tax on the sale of the real estate.
In fact, if a tenant group was organized and informed, they could present an updated unsolicited offer to purchase their community annually if so desired. The landlord would certainly be aware of a sincere interest at that point, and could perhaps be relieved of the worry about the future of the community.
Sadly, in today’s legislative proposals, a landlord being forced to delay, and to have a no-sale period of time to allow for tenants to gather and organize and decide if they do or do not want to buy their community is an imposition on the property rights of the landlord. Add the requirement the landlord must negotiate with the quickly-formed tenant group and all the while have the risk of lawsuit and damage to the real title of the property, and you have established the tenant group as an adversary, trying to make a hostile takeover of the community.
The state cannot force a property owner to sell to another private party. Therefore, legislation such as HB 1129 or SB 5198 can be seen as costing landlords time and money to achieve nothing if animosity is created trying to force a sale to an adversary.
There are constitutional limits to what the state can do to burden any property owner to achieve some desired purpose. Solutions that keep these limits in mind, while society shares the burden, can help achieve societal benefits even if the end result is simply helping private homeowners deal with daunting challenges they did not fully appreciate or anticipate.
The fact that external factors out of the control of homeowners and landlords make the problems of sales or closures of manufactured housing communities appear much more serious, is all the more reason for external sources be tapped to help alleviate the burdens each face. Government can and should intervene and shoulder the burden in the process.
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