Title of Regulation: 13VAC5-95. Virginia Manufactured Home Safety Regulations (amending 13VAC5-95-10, 13VAC5-95-60).

Statutory Authority: § 36-85.2 of the Code of Virginia.

Public Hearing Information:

September 28, 2020 - 10 a.m. - Google Meet Meeting - The link to access the electronic meeting is meet.google.com/rqj-cmsq-rft, or copy and paste the link into a browser. Additional details and information are available on the Virginia Regulatory Town Hall (www.townhall.virginia.gov).

Public Comment Deadline: November 13, 2020.

Agency Contact: Kyle Flanders, Senior Policy Analyst, Department of Housing and Community Development, Main Street Centre, 600 East Main Street, Suite 300, Richmond, VA 23219, telephone (804) 786-6761, FAX (804) 371-7090, TTY (804) 371-7089, or email kyle.flanders@dhcd.virginia.gov.

Basis: The statutory authority to update the regulation is contained in § 36-85.7 of the Code of Virginia.

Purpose: The intent and goal of this action is to update the Manufactured Home Safety Regulations (MHSR) based on current U.S. Department of Housing and Urban Development (HUD) construction standards. This action will also consider amendments to administrative and enforcement provisions of the MHSR as determined necessary for the administration of Virginia's Manufactured Home Installation Program. This action ensures that manufactured homes are installed in a safe manner to protect the health, safety, and welfare of the citizens of the Commonwealth.

Substance: The proposed amendments include updating all references to the Federal Installation Standards (24 CFR Part 3285). The proposed regulation will contain minor changes to the provisions of the regulations that have been vetted through the client groups affected by the MHSR and have met no opposition. There is anticipation and request for assistance regarding manufactured housing installation. A more up-to-date enforcement standard is necessary to provide assistance to building officials and local building inspections departments, installers, and home owners regarding installation and inspections procedures and all processes related to the installation of manufactured homes within the Commonwealth.

Issues: The advantage of the revision for the public, building officials, installers, and private citizens are the new mandated HUD installation regulations, which provide minimum requirements for the initial installation of new manufactured homes. New home installation, designs, and instructions have been approved by the Secretary of HUD or a design approval primary inspection agency. The Federal Construction Standards are enforcement provisions for the design, construction, distribution and the installation of manufactured homes. Building officials are responsible for enforcement of the installation standards in the set up of a new manufactured home for footings, foundation systems, anchoring systems, close up of the exterior and interior, additions and alterations, and all system connections done during initial installation. Such aspects shall be subject to and shall comply with the installation instructions provided by the manufacturer of the home.

The amendments will ensure the installation of a manufactured home is in compliance with the federal installation standards by clarifying the certification and license requirements of the installer.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The Board of Housing and Community Development (Board) proposes to amend 13VAC5-95 Virginia Manufactured Home Safety Regulations to make it consistent with federal Housing and Urban Development (HUD) Manufactured Home Installation Standards.¹ Specifically, the proposed amendments would add a definition for "certificate of installation," update the definition of "installer" and require installers to provide a copy of the certificate of installation to homeowners and/or local building officials.

Background. The Board proposes to define "Certificate of installation" as "the certificate provided by the Virginia Department of Professional and Occupational Regulation (DPOR) licensed installer, under the Virginia Manufactured Home Safety Regulations, indicating that a manufactured home has been installed in compliance with the federal installation standards." To mirror this, the Board would also modify the current definition of "installer," which is "the person or entity who is retained to engage in or who engages in the business of directing, supervising, controlling, or correcting the initial installation of a manufactured home." The new definition would add the requirement that the installer be "licensed through the Virginia Department of Professional and Occupational Regulation, with the Manufactured Home Contractor (MHC) license designation." The Board of Contractors created the MHC license designation as a distinct specialty classification as part of a periodic review in 2012.² Therefore, this change in definition does not actually affect installers by imposing any new burden associated with licensing. Finally, the Board seeks to amend section 13VAC5-95-60 Installations to add the requirement that installers "shall provide a copy of the certificate of installation to the homeowner and when requested, to the local building official, prior to issuance of the certificate of occupancy."

Estimated Benefits and Costs. The proposed amendments align the language in the regulation with federal requirements. To the extent that the federal requirements promote the protection of buyers and owners of manufactured housing, the proposed amendments would benefit buyers and owners of manufactured housing in Virginia by ensuring that these protections are extended to them.

Installers of manufactured housing may face a small increase in costs from having to provide a certificate of installation, especially if local building officials start to require it prior to issuing a certificate of occupancy. However, such costs are likely to be nominal when compared with the installer's overall cost of doing business.

Businesses and Other Entities Affected. Installers of manufactured housing would be affected. Applicants for the MHC license designation are required to complete manufactured home installer training that is offered by the Department of Housing and Community Development.³ Based on the number of individuals who have completed this training, the Board estimates that up to 856 individuals would be affected by the requirement to provide a certificate of installation to the homeowner and local building official.⁴

Adverse impact is indicated if there is any increase in net cost or reduction in net revenue for any entity, even if the benefits exceed the costs for all entities combined. While the benefits of increased protection of buyers and owners of manufactured housing may be substantial, there may be a small increase in costs for installers that is not directly offset. Thus, adverse impact is indicated for this action.

Small Businesses⁵ Affected. The proposed amendments would affect small businesses that belong to or employ manufactured home installers. However, the cost of providing a certificate of installation is likely to be small and unlikely to have a disproportionate impact on small businesses.

Localities⁶ Affected.⁷ The proposed amendments potentially affect installers of manufactured homes in all localities. The proposed amendments are unlikely to introduce new costs for local governments.

Projected Impact on Employment. The proposed amendments are unlikely to cause any changes to total employment in the manufacturing, retail, or installation of manufactured housing.

Effects on the Use and Value of Private Property. The proposed amendments are unlikely to affect the use or value of private property. Real estate development costs are unlikely to be affected.

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¹See 24 CFR Part 3285: https://www.law.cornell.edu/cfr/text/24/part-3285

² See https://townhall.virginia.gov/L/ViewAction.cfm?actionid=2664

3See https://www.dhcd.virginia.gov/sites/default/files/Docx/manufactured-housing/how-to-mh-licensed-installer-2019.pdf for current requirements

⁴Only 300 of these identified as installers; the rest are manufacturers, brokers, dealers and salespersons. See https://townhall.virginia.gov/l/GetFile.cfm?File=61\5248\8851\AgencyStatement_DHCD_8851_v1.pdf

⁵Pursuant to § 2.2-4007.04 of the Code of Virginia, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

⁶"Locality" can refer to either local governments or the locations in the Commonwealth where the activities relevant to the regulatory change are most likely to occur.

⁷§ 2.2-4007.04 defines "particularly affected" as bearing disproportionate material impact.

Agency's Response to Economic Impact Analysis: The Department of Housing and Community Development concurs with the economic impact analysis prepared by the Department of Planning and Budget.

Summary:

The proposed amendments are for consistency with federal Housing and Urban Development Manufactured Home Installation Standards and add a definition for "certificate of installation," update the definition of "installer," and require installers to provide a copy of the certificate of installation to homeowners or local building officials.

13VAC5-95-10. Definitions.

A. The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Administrator" means the Director of DHCD or his designee.

"Certificate of installation" means the certificate provided by the Virginia Department of Professional and Occupational Regulation licensed installer, under the Virginia Manufactured Home Safety Regulations, indicating that a manufactured home has been installed in compliance with the federal installation standards.

"DHCD" means the Virginia Department of Housing and Community Development.

"Dealer" means any person engaged in the sale, lease, or distribution of manufactured homes primarily to persons who in good faith purchase or lease a manufactured home for purposes other than resale.

"Defect" means a failure to comply with an applicable federal manufactured home construction and safety standard that renders the manufactured home or any part of the home unfit for the ordinary use of which it was intended, but does not result in an imminent risk of death or severe personal injury to occupants of the affected home.

"Distributor" means any person engaged in the sale and distribution of manufactured homes for resale.

"Federal Act" means the National Manufactured Housing Construction and Safety Standards Act of 1974, as amended (42 USC § 5401 et seq.).

"Federal installation standards" means the federal Model Manufactured Home Installation Standards (24 CFR Part 3285).

"Federal regulations" means the federal Manufactured Home Procedural and Enforcement Regulations (24 CFR Part 3282).

"HUD" means the United States Department of Housing and Urban Development.

"Imminent safety hazard" means a hazard that presents an imminent and unreasonable risk of death or severe personal injury that may or may not be related to failure to comply with an applicable federal manufactured home construction or safety standard.

"Installation" means completion of work to include, but not be limited to, stabilizing, supporting, anchoring, and closing up a manufactured home and joining sections of a multi-section manufactured home, when any such work is governed by the federal installation standards.

"Installer" means the person or entity, licensed through the Virginia Department of Professional and Occupational Regulation, with the Manufactured Home Contractor (MHC) license designation, who is retained to engage in or who engages in the business of directing, supervising, controlling, or correcting the initial installation of a manufactured home.

"Label," "certification label," or "HUD label" means the certification label prescribed by the federal standards.

"Local building official" means the officer or other designated authority charged with the administration and enforcement of USBC, or duly authorized representative.

"Manufactured home" means a structure subject to federal regulation, which is transportable in one or more sections; is eight body feet or more in width and 40 body feet or more in length in the traveling mode, or is 320 or more square feet when erected on site; is built on a permanent chassis; is designed to be used as a single-family dwelling, with or without a permanent foundation, when connected to the required utilities; and includes the plumbing, heating, air conditioning, and electrical systems contained in the structure.

"Manufacturer" means any person engaged in manufacturing or assembling manufactured homes, including any person engaged in importing manufactured homes.

"Noncompliance" means a failure of a manufactured home to comply with a federal manufactured home construction or safety standard that does not constitute a defect, serious defect, or imminent safety hazard.

"Purchaser" means the first person purchasing a manufactured home in good faith for purposes other than resale.

"Secretary" means the Secretary of HUD.

"Serious defect" means any failure to comply with an applicable federal manufactured home construction and safety standard that renders the manufactured home or any part thereof not fit for the ordinary use for which it was intended and which results in an unreasonable risk of injury or death to occupants of the affected manufactured home.

"Standards" or "federal standards" means the federal Manufactured Home Construction and Safety Standards (24 CFR Part 3280) adopted by HUD, in accordance with authority in the Federal Act. The standards were enacted December 18, 1975, and amended May 11, 1976, to become effective June 15, 1976.

"State administrative agency" or "SAA" means DHCD, which is responsible for the administration and enforcement of Chapter 4.1 (§ 36-85.2 et seq.) of Title 36 of the Code of Virginia throughout Virginia and of the plan authorized by § 36-85.5 of the Code of Virginia.

"USBC" means the Virginia Uniform Statewide Building Code (13VAC5-63).

B. Terms defined within the federal regulations and federal standards shall have the same meanings in this chapter.

13VAC5-95-60. Installations.

Distributors, installers, or dealers Installers setting up a manufactured home shall perform such installation in accordance with the manufacturer's installation instructions and shall provide a copy of the certificate of installation to the homeowner and when requested, to the local building official prior to issuance of the certificate of occupancy.