Source: https://www.federalregister.gov/articles/2014/05/02/2014-10129/manufactured-housing-program-fee-proposed-fee-increase
Timestamp: 2016-05-03 14:27:01
Document Index: 200505988

Matched Legal Cases: ['art 3284', 'ART 3284', 'art 3284', '§ 3284', '§ 3284', '§ 3282', 'art 3280']

Federal Register | Manufactured Housing Program Fee: Proposed Fee Increase
-25038 (4 pages)
Document Number: 2014-10129
Shorter URL: https://federalregister.gov/a/2014-10129 Related Topics
FR–5721–P–01 Manufactured Housing Program Fee: Proposed Fee Increase
Manufactured Housing Program Fee (FR–5721) 3 actions from May 2nd, 2014 to July 2014
Annual appropriations acts since 2002 have authorized HUD to modify manufactured housing fees pursuant to section 620 in order to ensure a final appropriation for the applicable fiscal year. (See the Departments of Veterans Affairs and Housing and Urban Development and Independent Agencies Appropriations Act, 2002, Public Law 115 Stat. 651, approved November 26, 2001. See the account language for HUD's Manufactured Housing Fees Trust Fund, at 115 Stat. 669.) The annual appropriations language for the Manufactured Housing Fees Trust Fund account typically reads as follows: “Provided further, that the amount made available under this heading from the general fund shall be reduced as such collections are received during fiscal year [applicable fiscal year inserted] so as to result in a final fiscal year [applicable fiscal year inserted] appropriation from the general fund estimated at not more than $0 and fees pursuant to such section 620 shall be modified as necessary to ensure such a final fiscal year [applicable fiscal year inserted] appropriation.” Similar language is found in the Consolidated Appropriations Act, 2014 (Pub. L. 113-76, approved January 17, 2014). Although the statutory authorization to modify fees has been in place since the 2002 appropriations act, HUD has not revised the manufactured housing fee since 2002. (See HUD's final rule published on August 13, 2002, at 67 FR 52832.) Given the substantial reduction in appropriations for manufactured housing since 2002,
HUD proposes that it is time to increase the fee.
When HUD last modified the amount of the fee per transportable section in 2002 (67 FR 52832, August 13, 2002), HUD divided the annual projected number of manufactured housing transportable units (350,000) into the amount appropriated by Congress for the manufactured housing program for the fiscal year. (See 67 FR at 52832.) Since 2002, the number of transportable units and therefore fee collection has decreased and HUD has not adjusted its fee to compensate for the decline in production, instead relying on direct appropriations and carryover to fund program operations. While the number of transportable units has declined, program expenses over the last 12 years have risen. Requirements related to overseeing the quality, safety and durability of manufactured housing, necessary and important requirements, have contributed to increased program expenses. As provided in HUD's 2015 budget justification, HUD has estimated that, at current production levels, approximately $10 million annually is required to administer the Manufactured Housing Program in a manner that fulfills HUD's statutory oversight responsibilities.
If the production and placement of manufactured homes were expected to equal 95,000 sections, HUD would need to set the fee at approximately $105 per section. A fee increase of $66 ($39 to $105) would add on average $104 ($66 * 1.57) to the cost of each manufactured home, which is approximately 0.17 percent of the average sales price of a manufactured home.
Meeks (1993) estimates the price elasticity of demand for manufactured homes as −2.4.
This implies that a one percent increase in price will decrease demand by 2.4 percent. If producers fully absorbed the fee increase and sales remained at 95,000 sections, the fee would raise $9.975 million, an increase of $6.27 million. However, if the fee increase were fully passed to the consumer, the sales price of manufactured homes would rise on average 0.17 percent and sales would fall to 94,618 transportable sections. Annual collections would increase by $6.230 million to $9.935 million.
III. Justification for 30-Day Comment Period Back to Top
It is the general practice of the Department to provide a 60-day public comment period on all proposed rules. However, the Department is shortening its usual 60-day public comment period to 30 days for this proposed rule. This rule proposes to adjust the current label fee that is collected from manufacturers of manufactured homes upwards from $39 to possibly $105. While HUD acknowledges that it is not an insignificant fee increase, HUD has been public the last two years about the need to possibly raise the fee to $100
to sustain the Manufactured Housing Program, and HUD has received no significant response from industry on the need to raise significantly the current fee. For the reasons already addressed in this preamble, it is important to make the amount of the fee effective as soon as possible so that the funds will be available as soon as possible to offset the expenses incurred by the Department in connection with the manufactured housing program authorized by the Act, and to sustain the program. For these reasons, the Department has determined that a 30-day public comment period is appropriate.
IV. Findings and Certifications. Back to Top
The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. This rule would not have a total economic impact of more than $6.1 million, which is the maximum additional amount of fees that HUD has determined would be collected if the fee is raised to $100 per label.
List of Subjects in 24 CFR Part 3284 Back to Top
PART 3284—MANUFACTURED HOUSING PROGRAM FEE Back to Top
1.The authority citation for 24 CFR part 3284 continues to read as follows: Authority:
42 U.S.C. 3535(d), 5419, and 5424.
2.Revise § 3284.5 to read as follows: § 3284.5 Amount of fee.
Each manufacturer, as defined in § 3282.7 of this chapter, must pay a fee of $100 per transportable section of each manufactured housing unit that it manufactures under the requirements of part 3280 of this chapter.
2. HUD's 2015 Congressional Justification can be found at http://portal.hud.gov/hudportal/HUD?src=/program_offices/cfo/reports/fy15_CJ.
5. See HUD's Congressional Justifications for 2014 and 2015 at http://portal.hud.gov/hudportal/HUD?src=/program_offices/cfo/budget.