A bill to fund the cleanup of the state’s abandoned manufactured housing was ratified in the North Carolina General Assembly yesterday.  H1134, sponsored by Philip Haire, awaits a signature from Governor Easley.  It will become effective July 1, 2009 and run until 2023.

The bill authorizes the Department of Environment and Natural Resources to distribute up to $1 million per year to counties that clean up abandoned homes.  While an earlier version extended the bill’s coverage to include abandoned mobile homes that were utilized as classrooms, no explicit extension of that provision is included in the final version.  Counties must develop a plan to remove the homes in order to apply for funding dollars, although no county is required to participate in the program.  Tier One and Tier Two Counties can get extra dollars when removal costs exceed $1000 per unit.

It is hard to know how much of a difference this bill will make.  Certainly, North Carolina has stepped out to stamp the counties with the authority to clean up their spaces.  Nonetheless, some of the success or failure of this bill will depend upon the marketing efforts that occur going forward. If counties do not know about these funds, then it is unlikely that they develop a removal plan.  Funding of $1 million per year could soak up a considerable portion of the discretionary funds at DENR, too.

H1700, the bill to prevent the displacement of residents from manufactured housing communities, exited the North Carolina General Assembly’s House this week. It passed by a vote of 113 to 5, with two abstentions. The bill, in its fourth version, goes to the Senate this week. Its first stop will be with the Senate Committee on Commerce, Small Business, and Entrepreneurship, chaired by Senator R.C. Soles, Jr.

The bill seeks to reward park owners that sell to resident owned groups or to non-profits. The carrot behind the bill is to provide a financial incentive. In an earlier version, the “carrot” consisted of a seven percent credit on the likely capital gain made by the owner.

Paul Stam, a Republican from Apex, pointed out that the bill’s structure would do little in instances when (more…)

H1134, the bill to help North Carolina Counties remove their abandoned mobile homes, has reached a stage where many legislators feel compelled to shape it before it becomes law. This is good. It means that the bill has legs and that it will probably be enacted in some form.

The bill is sponsored by Phillip Haire (Jackson-D) with Lucy Allen (Franklin-D), Joe Tolson (Edgecombe-D), Carolyn Justice (Pender-R). It is not a coincidence that each comes from one of our state’s rural areas. This issue is most severe in rural counties. Moreover, the funding that the bill provides matters because many of these counties are strapped by a lack of revenue and steadily increasing Medicaid costs.

A lot happened on Thursday.

In House Finance, the bill was amended by Rep. Julia Howard (Mocksville-R) to include abandoned mobile classrooms.

There was much debate, led mainly be Rep. Bill Daughtridge (R-Rocky Mount) and Rep. Curtis Blackwood (R-Matthews), to exempt property owners who were not rightful owners of the abandoned home in question from being sued by the county for removal of the mobile home in question; an amendment to this effect was also adopted.

The Solid Waste Management Fund, from which the monies to fund the grants in this bill will be drawn had roughly $1,000,000 in revenue and $1,000,000 in expenditures this year. However, the landfill tipping fee surcharge enacted last year, which will expand the revenue base of the Fund, has not kicked in yet, and in fact, a bill to delay the tip fee start date (H2541) has passed House Finance. Rep. Haire said he would offer an amendment that would align the effective date of this bill with that of the effective date of the landfill tipping fee.

The decision to strip out the liability clause may be a big deal.  Certainly, it removes some of the “stick” that counties have in their efforts to clean up the homes.  It can be a problem getting an absentee landowner to pay attention to this problem.  That is especially the case when a land owner is actually a mortgage company or servicer based out of a P.O. Box in New York.  County code enforcement officers are limited in their ability to accomplish anything across state lines.

The successful programs in Brunswick and Scotland Counties both have these liability provisions.  However, in the case of Brunswick, it hasn’t been necessary to use that rule very often.  They have managed to remove more than 1200 homes with a program that is almost entirely based upon the voluntary consent of land owners.

North Carolina’s H1700, a bill to reward park owners to sell to residents and non-profits, shifted directions today.

The bill came before the House with language that would have provided a tax credit equivalent to seven percent of the gain made by owners.  That gain would have been usable against tax liabilities for up to three years.

Two changes took place.  First, Paul Stam (R-Apex) pointed out that the bill would do nothing for owners who sell their park at little gain or even at a loss.  In many instances, park owners face that exact dilemma.  With stagnant wages in many rural counties, cash flows at parks have leveled off.  Often times, people that would have bought a home and put it in a park could, until recently, qualify for a mortgage through a subprime arrangement.

With that in mind, Stam asked for staff to consider an amendment.

Secondly, staff from Revenue considered changing the language on the incentive from a tax credit to a deduction.

The bill may be heard on Monday in the House.  It could still pass the House and make it across to the Senate this year.

North Carolina’s General Assembly gave substantial attention yesterday to a bill that would impact the fates of manufactured housing residents.

H1700, a bill sponsored by Susan Fisher that would provide a financial incentive to park owners to sell to resident or non-profit groups, made some progress in Judiciary II.  The bill was held up by its notice provision, which had stipulated that park owners should communicate in writing via US mail to each resident prior to a sale.

According to one MH industry leader, this triggers some concerns over property rights.

An alternative was put forward that only requires notice in the event of a change in use.  In other words, no notice is required if a park is sold to another private group that wants to maintain the park as is.  If a park owner wants to sell to a big box retailer, though, then a notice is required.

Advocates and industry express doubts about the difference that this would ultimately make — after all, no resident group is going to be able to match the kind of offer that a Wal-Mart of Home Depot could make for land that it would repurpose into a large commercial center.

No, a useful bill should probably preserve the notice provision for parks for exactly the opposite set of parks — those that are likely to remain in their current status.  These are the ones whose prices can reasonably be met by non-profits.  In North Carolina, that might be parks up to $2 million.