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Manufactured Home Installation Program

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Start Preamble Start Printed Page 35270

AGENCY:

Office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD.

ACTION:

Final rule.

SUMMARY:

This final rule establishes a federal manufactured home installation program, as required by section 605(c)(2)(A) of the National Manufactured Housing Construction and Safety Standards Act of 1974. States that have their own installation programs that include the elements required by statute are permitted to administer, under their state installation programs, the new requirements established through this final rulemaking. The new elements required by statute to be integrated into an acceptable state manufactured home installation program are: The establishment of qualified installation standards; the licensing and training of installers; and the inspection of the installation of manufactured homes.

DATES:

Effective Date: October 20, 2008.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

William W. Matchneer III, Associate Deputy Assistant Secretary for Regulatory Affairs and Manufactured Housing, Office of Manufactured Housing Programs, Department of Housing and Urban Development, 451 Seventh Street, SW., Room 9164, Washington, DC 20410; telephone number 202-708-6401 (this is not a toll-free number). Persons with hearing or speech impairments may access this number via TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339.

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

I. Background

Requirement for an Installation Program

The National Manufactured Housing Construction and Safety Standards Act of 1974 (42 U.S.C. 5401-5426) (“the Act”) is intended, in part, to protect the quality, safety, durability, and affordability of manufactured homes, and was amended on December 27, 2000 (Manufactured Housing Improvement Act of 2000, Title VI, Pub. L. 106-659, 114 Stat. 2997). In order to accomplish those objectives, the Act requires HUD to, among other things, establish and implement a new manufactured home installation program for states that choose not to operate their own installation programs. Specifically, section 605 of the Act (42 U.S.C. 5404) calls for the establishment of an installation program that includes installation standards, the training and licensing of manufactured home installers, and inspection of the installation of manufactured homes. The model manufactured home installation standards (“the installation standards”) themselves can be found in a separate final rule, which was published on October 19, 2007 (72 FR 59338). Any state that wishes to operate its own installation program must contain state installation standards that afford residents of manufactured homes at least the same protection provided by the federal installation standards.

Although a state that wants to operate its own installation program is not required to be a State Administrative Agency (“SAA”) established pursuant to HUD's Manufactured Home Procedural and Enforcement Regulations (see 24 CFR part 3282), any state that submits a new state plan to become an SAA after the implementation of the Manufactured Home Installation Program must include a complying installation program as part of its plan. As a result, any state that becomes an SAA for the first time, or any state that becomes an SAA again after a lapse in its SAA status, will be required to administer its own compliant installation program.

Proposed Rule

On June 14, 2006, at 71 FR 34476, HUD published the Manufactured Home Installation Program proposed rule with a comment due date of August 14, 2006. There were a total of 35 commenters on the June 14, 2006, proposed rule. Twenty-seven of the commenters were from the manufactured home industry, including manufacturers, component suppliers, retailers, installers, trade associations, and community operators. Five commenters were from SAAs. The remaining commenters were a consumer group, the Manufactured Housing Consensus Committee (MHCC), and one member of the insurance industry.

HUD worked closely and participated in several meetings with the MHCC in order to obtain their input and suggestions. In response to comments from the public and input from the MHCC, HUD has made a few significant changes to the proposed rule.

II. General Areas of Interest to Commenters

This section of the preamble discusses general areas of interest to commenters. One of the general recommendations most often made by the commenters was to codify the Manufactured Home Installation Program in the existing 24 CFR part 3282, rather than in the new part § 3286, in the belief that the installation program would thereby become “preemptive” of state and local installation requirements in states where HUD administers the installation program.

Preemption

Commenters requested that the installation program and installation standards be made preemptive of state and local requirements in states where HUD administers the installation program. However, HUD has concluded that a plain reading of sections 604(d) and 605 of the Act indicates that Congress did not intend for the installation program or the installation standards to be preemptive of more stringent state or local government requirements. This conclusion is strengthened by the legislative history of the Act. During his section-by-section comments on the floor of the House when the Act was being debated, then House Financial Services Committee Chairman Jim Leach stated that “the bill would reinforce the proposition that installation standards and regulations remain under the exclusive authority of each state.” (See Dec. 5, 2000, 146 Cong. Rec. H11960-01.) In “Additional Views” that were included in the House Report on the bill, then Ranking Committee Member John LaFalce noted that “for the first time, we will be setting a national minimum installation standard * * *” (H. Rpt. 106-553, pg. 182). In earlier floor remarks, Rep. LaFalce said, “[s]tates that wish to have their own installation standards may continue to do so, as long as they provide protections comparable to the model standards.” (Oct. 24, 2000, 146 Cong. Rec. H10685). HUD, therefore, concludes that Congress has permitted state governments to implement installation standards that are more stringent than the federal installation standards, provided that those state standards otherwise offer protection that equals or exceeds the minimum protection established by the installation standards.

Codification in Part 3286 of 24 CFR

Commenters, including the MHCC, continued to state that the Manufactured Home Installation Program should be codified under 24 CFR part 3282, Manufactured Home Procedural and Enforcement Regulations. Contrary to the views expressed by these commenters, Start Printed Page 35271preemption authority can come only from Congress, and no decision that HUD makes regarding the codification of the Manufactured Home Installation Program could increase or diminish that authority. As indicated above, HUD has concluded that Congress did not intend to extend preemption authority to the installation of manufactured homes.

In any event, HUD has chosen, as a matter of administrative necessity, to codify the Manufactured Home Installation Program in a new 24 CFR part 3286 in order to maintain the clear distinctions that the Act makes between installation and construction. The regulatory structure that Congress has given HUD for enforcement of the Manufactured Home Installation Program is entirely different from the enforcement authority it previously gave HUD for the Federal Manufactured Home Procedural and Enforcement Regulations. As HUD reads sections 613 (42 U.S.C. 5412) and 615 (42 U.S.C. 5414) of the Act, the principal sections requiring notification and correction of defects, these sections do not apply to the installation of manufactured homes. As HUD reads the Act, the primary enforcement authority for the installation of manufactured homes, implemented through sections 610 and 611 (42 U.S.C. 5409 and 5410, respectively), is section 605 (42 U.S.C. 5404) itself, which not only provides more limited authority for the installation of manufactured homes, but adds new requirements regarding the licensing and training of installers.

Given these fundamental differences between the installation and construction and safety programs, publication of the Manufactured Home Installation Program in a new 24 CFR part 3286 will best allow HUD to maintain the regulatory separation necessary to administer two such different programs.

Commenters stated that the purpose of the Manufactured Home Installation Program should be to establish HUD's default installation program for those states that do not meet the required elements of the Act through state law. The rule should not be used to create a prescriptive base-line standard for each state-based installation program. In order to avoid confusion on this issue, the final rule sets out, in discrete subparts: (1) Manufactured home installation requirements that are applicable in all states (subpart A) and to all manufacturers; (2) requirements that are applicable in only those states in which HUD is administering the installation program (subparts B through H); and (3) requirements for states that wish to apply to administer their own installation programs in lieu of the HUD program (subpart I). Further, to make the applicable requirements more readily identifiable, the final rule separately organizes the requirements that apply to the retailers, distributors, installers, installation trainers, and installation inspectors in states where HUD administers the installation program.

Installation in Accordance With the Installation Standards

The MHCC was particularly concerned that the Manufactured Home Installation Program proposed rule required compliance with the installation standards, and not with the installation design and instructions provided by the manufacturer. HUD agreed with the MHCC that it would be better for the consumer to require compliance with the manufacturer's installation design and instructions, since such designs and instructions may differ from the installation standards by providing requirements that not only exceed the installation standards, but are also specific to the installation requirements of the particular home being installed.

The final rule of the installation program requires that the manufactured home be installed in accordance with:

(1) An installation design and instructions that have been provided by the manufacturer and approved by the Secretary directly or through review by the Design Approval Primary Inspection Agency (DAPIA); or

(2) An installation design and instructions that have been prepared and certified by a professional engineer or registered architect and have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter.

III. Particular Areas of Interest to Commenters

This section of the preamble discusses specific, section-by-section areas of interest to commenters. In response to the comments and the MHCC's input, HUD has made a few significant changes to the proposed rule.

Section 3286.2(d)(3) Applicability. Many commenters suggested expanding the Manufactured Home Installation Program to cover secondary installations of manufactured homes in addition to initial installations. It is HUD's position that Congress intended the installation program to be applicable only to the initial installation of new manufactured homes, as indicated by references in section 623(g) of the Act to the date of installation and by the definition of “purchaser” as the first purchaser in section 603 of the Act. A very small percentage of manufactured homes are ever relocated after initial siting and placement of the homes. The Manufactured Home Procedural and Enforcement Regulations encourage States to establish procedures for the inspection of used manufactured homes and for monitoring of the installation of manufactured homes within each State (§ 3282.303), indicating the intent of Congress to place the supervision of reinstallments in the hands of the States.

The final rule clarifies that the installation program does not prevent State and local governments from regulating subsequent installations of manufactured homes. State standards for initial installation must meet or exceed HUD's minimum installation standards, while state standards for secondary installations do not have to adhere to the minimum HUD standards. HUD concludes that any subsequent installation of a manufactured home resides with State authority.

Section 3286.103 DAPIA-approved installation instructions. HUD agrees with the commenters who stated that the retailer must provide the purchaser with a copy of the DAPIA-approved installation instruction manual for each home in states where HUD administers the installation program. However, the retailer should not be required to provide an installation design and instructions if the retailer has not agreed to provide any set up in connection with the sale of the home and the installation requires a design that is different than that provided by the manufacturer's installation manual for the home. HUD agrees that the retailer or manufacturer should provide the installation design and instructions for installations that require designs that differ from those provided by the manufacturer's instruction manual when the retailer or manufacturer agrees to provide any set up in connection with the sale of the home. The proposed rule placed the entire burden of providing the installation instructions upon the retailer.

Accordingly, the final rule has been revised to require the retailer to provide the purchaser with a copy of the DAPIA-approved installation instructions for each manufactured home, and to require the retailer or manufacturer to provide to the installer the installation design and instructions for installations that require designs that differ from those provided by the manufacturer when the retailer or manufacturer agrees to Start Printed Page 35272provide any set up in connection with the sale of the home. Although either the retailer or the manufacturer now has the responsibility to provide instructions to the installer, rather than only the retailer, the overall burden associated with the requirement to provide instructions has not changed.

The final rule does not require the retailer or manufacturer to provide installation instructions to the installer if the retailer or manufacturer has not agreed to provide any set up in connection with the sale of the home, since the installer performing the installation may not be known by the retailer or manufacturer.

Section 3286.109 Inspection requirements—generally. HUD agrees with commenters who stated that the requirements in the proposed rule may delay the completion of sale. The original wording extended the completion of sale date to the date that the home was installed. This may have had an adverse effect on retailers when they do not provide set up in connection with the sale of the home, since the retailer's duties would not end until an independent third party completed its work. HUD has made appropriate revisions to this section, in order to clarify when a sale is complete.

Section 3286.405 Site suitability. HUD agrees with the many commenters who stated that it should be the installer's responsibility to verify site suitability for the installation of a home. Subpart C of the Model Installation Standards includes many site preparation requirements that must be performed during the installation of the manufactured home. Accordingly, the licensed installer is responsible for determining the suitability of the site with regard to the requirements in the Model Installation Standards. The requirements are not the responsibility of the retailer or manufacturer.

Section 3286.803(b) Minimum elements. A majority of commenters stated that the provision for a state to prove it has adequate funding in order to be approved to run its own installation program should be removed and is not a requirement of the Act. HUD, however, believes that the requirement is appropriate. The final rule should also include an additional item that would allow HUD to approve state installation programs, provided the state demonstrates an alternative means for achieving the end goal of improved manufactured housing.

IV. Section-by-Section Revisions—Changes to Proposed Rule

In response to the public comments and subsequent reevaluation by HUD, the following is a summary, by subpart, of the section-by-section revisions being made to the Manufactured Home Installation Program proposed rule.

Subpart A—Generally Applicable Provisions and Requirements

A new paragraph (b), “Implementation,” is added to § 3286.1 to provide for Federal Register publication of an implementation schedule for the various components of the installation program. HUD will publish a separate notice setting forth a timetable for implementation of the elements of the program, for example, the program's installer training and licensing requirements, to provide an orderly transition to a fully operational installation program.

Paragraph (d)(2) of § 3286.2 makes clear that states that administer their own installation program may regulate subsequent installations of manufactured homes. Further, new paragraph (d)(4) was added to § 3286.2 recognizing that HUD does not have the authority to regulate the installation of manufactured homes on Indian reservations.

In response to comments, certain definitions, including definitions for manufactured housing installation instructions and installation, have either been added or modified in § 3286.3 of the final rule in order to provide clarity.

Section 3286.5 was modified to provide an overview of the HUD-administered installation program and the state-administered installation programs. The installer requirements are being moved to Subpart C, since these requirements are applicable only in states where HUD administers the installation program. The manufacturer must also include instructions for protecting the interior of the manufactured home or sections of homes from damage, pending the first siting of the home for occupancy. The instructions must be adequate to ensure that the temporary supports and weatherization used will be sufficient to prevent the home and its transportable sections from falling out of conformance with the Manufactured Housing Construction and Safety Standards (MHCSS) in part 3280 of this chapter, if the home or its sections is either:

(i) Stored at any location for more than 30 days; or

(ii) In the possession of any entity for more than 30 days.

Paragraph (b) of § 3286.7 was revised to require the retailer to provide the purchaser or lessee with a consumer disclosure prior to execution of the sales contract to purchase, or of the lease agreement to lease, a manufactured home. This disclosure must be in a document separate from the sales or lease agreement.

Section 3286.9 was revised to ensure that the manufacturer's reporting requirements in the installation program are consistent with the reporting requirements in § 3282.552. Form HUD-302 will be used to collect the information from the manufacturer.

The final rule has been revised to require retailers to update the tracking and installation information only for homes installed in states where HUD administers the installation program; therefore, § 3286.13 is being moved to § 3286.113.

Subpart B—Certification of Installation in HUD-Administered States

A new § 3286.102, that details the information that the manufacturer must provide to retailers or distributors, was added. It also requires the manufacturer to include a notice in the installation instructions that the home must comply with installation designs and instructions that are approved by either the Secretary of HUD or by the manufacturer's DAPIA.

Section 3286.103(a) was revised to require the retailer to provide a copy of the manufacturer's DAPIA-approved installation instructions for each home. The retailer or manufacturer must also provide an installation design and instructions if: (1) the installation requires a design that is different from that provided by the manufacturer, and (2) the retailer or manufacturer agrees to provide any set up in connection with the sale of the home.

A new paragraph (b) has been added to § 3286.105 that requires the retailer or manufacturer to ensure that the installer is licensed if the retailer or manufacturer agrees to provide any set up in connection with the sale or lease of the home.

Section 3286.107 has been revised to require installers to comply with the manufacturer's installation design, or with alternative designs and instructions that were prepared by a professional engineer or registered architect, as long as the alternative designs and instructions have been reviewed and approved by the manufacturer and its DAPIA.

A new paragraph (a)(4) has been added to § 3286.107 that clearly sets out that any installation defect caused by the installer's work is the joint responsibility of the installer and of the retailer or manufacturer that retained the installer. A new § 3286.107(a)(5) also makes them jointly and severally liable for the correction of any failures Start Printed Page 35273to comply with the installation standards.

Section 3286.109 was revised to require the installer to certify, and the inspector to verify, that the home has been installed in accordance with the requirements of § 3286.107(a) before the home can be occupied.

Section 3286.113 was revised to delete references to the sale of the home and instead require retailers to provide tracking information and installation information only for homes installed in states where HUD administers the installation program. The proposed rule required the tracking information to be provided to HUD for all homes. The option of the Internet-based tracking system established by HUD was deleted. Retailer record retention requirements were shortened from 5 to 3 years.

Section 3286.115 of the proposed rule was revised to include the date that the installer certified that all required inspections were completed as part of the date of installation.

Section 3286.117 was modified to redefine the completion of sale date.

Subpart C—Installer Licensing in HUD-Administered States

Section 3286.205(d) was revised to require an applicant for an installation license to obtain, when available in the state of installation, a surety bond or insurance that will cover the cost of repairing all damage to the home and its supports caused by the installer during the installation. The value of such bond or insurance must cover the costs of repair of any incidents that render the home defective, up to and including replacement of the home. The proposed rule required the installer to maintain general liability insurance in the amount of at least $1 million. This change will link the installer's costs more closely to the number of homes installed, rather than imposing a level cost regardless of the number of homes installed. Smaller installation operations that have a lesser volume of installations will benefit from this requirement.

Subpart D—Training of Installers in HUD-Administered States

Section 3286.303(d) was revised to shorten the period during which trainers and continuing education providers must retain records from 5 to 3 years.

Subpart E—Installer Responsibilities of Installation in HUD-Administered States

Section 3286.405(b) was revised to require the installer to identify the reasons why a site is unsuitable for installation when the installer has found that a site is unsuitable. The installer is also required to notify HUD of the site's unsuitability, in addition to notifying the retailer when it has made such a finding.

Two new paragraphs, (c) and (d), were added to § 3286.405. These paragraphs make clear that if the installer notices and recognizes any failures to comply with the construction and safety standards in part 3280 of this chapter prior to beginning any installation work, during the course of the installation work, or after the installation work is complete, the installer must notify the manufacturer and the retailer of each failure to comply. Additionally, the retailer must provide a copy of the notification received in paragraphs (b) (site suitability) and (c) (construction and safety failures) of this section to any subsequent installer.

Section 3286.409(d) was removed.

Section 3286.411(c) was modified and moved to § 3286.113.

Section 3286.413(b) was revised to shorten the period during which installers must retain records from the 5 years set out in the Manufactured Home Installation Program proposed rule to 3 years.

Subpart F—Inspection of Installation in HUD-Administered States

A new paragraph (c) was added to § 3286.503 requiring the installer to provide installation instructions to the inspector.

Section 3286.507(a) was revised to clarify that the installation verification provided by the inspector must be in writing.

International Code Council-certified inspectors were added to the list of qualified inspectors in § 3286.511(a).

Subpart G—Retailer Responsibilities in HUD-Administered States

A new paragraph (c) was added to § 3286.603 that requires the retailer or manufacturer to verify that the installer is licensed when the retailer or manufacturer agrees to provide any set up in connection with the sale or lease of the home.

Subpart H—Oversight and Enforcement in HUD-Administered States

The sections in subpart H are the same as in the proposed rule. They are not revised by this final rule.

Subpart I—State Programs

Sections 3286.801 and 3286.803(a) were revised to clarify that states that administer their own installation programs may do so either as part of their approved state plan or under Subpart I of the Manufactured Home Installation Program rule.

The time frames in § 3286.805(c) were revised to 90 days based on a comment from the MHCC that the time frames be consistent and that 90 days is a reasonable time frame for both actions.

Section 3286.807 was revised to require states to submit a new State Installation Program Certification form to the Secretary for review every 5 years after the state's most recent certification as a qualified installation program.

V. Findings and Certifications

Regulatory Planning and Review

The Office of Management and Budget (OMB) reviewed this rule under Executive Order 12866 (entitled “Regulatory Planning and Review”). OMB determined that this rule is a “significant regulatory action” as defined in section 3(f) of the order (although not an economically significant regulatory action, as provided under section 3(f)(1) of the order). The docket file is available for public inspection between 8 a.m. and 5 p.m. weekdays in the Office of the Rules Docket Clerk, Office of General Counsel, Department of Housing and Urban Development, 451 Seventh Street, SW., Room 10276, Washington, DC 20410-0500. Due to security measures at the HUD Headquarters building, please schedule an appointment to review the docket file by calling the Regulations Division at 202-708-3055 (this is not a toll-free number). Hearing-or speech-impaired individuals may access this number through TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339.

Paperwork Reduction

The information collection requirements contained in this final rule have been approved by OMB under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned OMB Control Number 2502-0253. In accordance with the Paperwork Reduction Act, HUD may not conduct or sponsor, and a person is not required to respond to, a collection of information, unless the collection displays a currently valid OMB control number.

Unfunded Mandates Reform Act

Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) establishes requirements for federal agencies to assess the effects of their regulatory actions on state, local, and tribal governments and the private sector. This rule does not impose any federal mandates on any state, local, or tribal government or the private sector Start Printed Page 35274within the meaning of the Unfunded Mandates Reform Act of 1995.

Environmental Review

A Finding of No Significant Impact with respect to the environment was made at the proposed rule stage in accordance with HUD regulations at 24 CFR part 50, which implement section 102(2)(C) of the National Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)) and remains applicable to this final rule. The Finding of No Significant Impact is available for public inspection between the hours of 8 a.m. and 5 p.m. weekdays in the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 Seventh Street, SW., Room 10276, Washington, DC 20410-0500. Due to security measures at the HUD Headquarters building, please schedule an appointment to review the docket file by calling the Regulations Division at 202-708-3055 (this is not a toll-free number). Hearing-or speech-impaired individuals may access this number through TTY by calling the toll-free Federal Information Relay Service at 1-800-877-8339.

Executive Order 13132, Federalism

Executive Order 13132 (entitled “Federalism”) prohibits, to the extent practicable and permitted by law, an agency from promulgating a regulation that has federalism implications and either imposes substantial direct compliance costs on state and local governments and is not required by statute, or preempts state law, unless the relevant requirements of section 6 of the Executive Order are met. This rule does not have federalism implications and does not impose substantial direct compliance costs on state and local governments or preempt state law within the meaning of the Executive Order.

HUD is required by statute to establish an installation program through the National Manufactured Housing Construction and Safety Standards Act of 1974 (the Act) (42 U.S.C. 5401-5426). However, in accordance with the Act and as set forth in this proposed rule, this Manufactured Home Installation Program is not preemptive. Therefore, HUD has determined that the Model Installation Standards, if adopted, have no federalism implications that warrant the preparation of a Federalism Assessment in accordance with Executive Order 13132.

Regulatory Flexibility Act

The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires agencies to consider the impact of their rules on small entities. Agencies must evaluate the impact of a rule on small entities and describe their efforts to minimize the adverse impacts.

As part of the proposed rule, HUD prepared an Initial Regulatory Flexibility Analysis (IRFA) that evaluated the potential economic impact on the small entities the regulations would affect, including: manufacturers, retailers, installers, and trainers. Pursuant to the requirements of the Regulatory Flexibility Act (5 U.S.C. 603), HUD prepared a Final Regulatory Flexibility Analysis (FRFA), which follows in its entirety.

Manufactured Home Installation Program Final Regulatory Flexibility Analysis: Reason That the Action Is Being Considered

On December 27, 2000, the National Manufactured Housing Construction and Safety Standards Act of 1974 (42 U.S.C. 5401-5426) was amended by the Manufactured Housing Improvement Act of 2000, which, among other things, requires the Secretary to establish an installation program for the enforcement of the Model Manufactured Home Installation Standards in each state that does not have an installation program established by state law and approved by the Department.

Objective of the Final Rule

The objective of the final rule is to establish the Manufactured Home Installation Program in each state that does not have an installation program established by state law and establish the requirements that must be met by a state to implement and administer its own installation program. The Manufactured Home Installation Program includes:

  • Systems for tracking and certifying manufactured home installations;
  • Licensing requirements for individuals and entities to qualify to install a manufactured home, which include required experience, training, testing, and proof of liability insurance;
  • Requirements for individuals or entities for providing the required training;
  • Responsibilities of the installer who is accountable for the installation of the manufactured home;
  • Inspection requirements that must be performed by a qualified inspector;
  • Responsibilities for retailers of manufactured homes in states that do not have qualifying installation programs;
  • Enforcement mechanisms to ensure the proper installation of manufactured homes; and
  • Requirements that must be met by a state to implement and administer its own installation program in such a way that the state would not be covered by the HUD-administered installation program.

Summary of Significant Issues Raised by Public Comment

There were a total of 35 commenters on the June 14, 2006, proposed rule. Twenty-seven of the commenters were from the manufactured home industry, including manufacturers, component suppliers, retailers, installers, trade associations, and community operators. Five commenters were from State Administrative Agencies (SAAs). The remaining commenters included one member of the insurance industry, a consumer group, and the Manufactured Housing Consensus Committee (MHCC).

None of the comments received addressed the IRFA. However, the Department did receive two general comments regarding the Regulatory Flexibility Analysis summary in the preamble of the proposed rule. The comments were:

  • “While HUD's proposed rule does include a cost-impact estimate under the Regulatory Flexibility Act—showing a projected cost increase of $974 for a single-section home and $1,023 for a double-section home in HUD-administered states—there is no evidence that HUD has considered the affordability of the proposed installation program as a function of the affordable housing mandates.”
  • “Overall cost impact for installation is a large concern for the industry. It is stated that a single-wide will increase approximately $974 and multi-section will increase approximately $1,023 in states where HUD would administer the installation program. In some parts of the U.S. this can make the purchase of a manufactured home unaffordable.”

In developing the proposed rule, the Department developed an installation program that implemented the statutory requirements outlined in the Act, while balancing protection for the consumer with the economic impact on small entities. Appendix A of the IRFA indicates that the five regulatory requirements in the proposed rule with the largest individual economic impact account for approximately 86 percent of total estimated cost increase of a manufactured home. The information in Table 1 summarizes these findings and a discussion follows for each summary: Start Printed Page 35275

Table 1

Summary of regulatory requirementCost impact per singleCost impact per multi
Regulation establishing liability insurance for installers in states without a qualifying installation program$302.52$302.52
Regulation requiring the inspection of every manufactured home installation in states without a qualifying installation program300.00350.00
Regulation establishing initial training for installers in states without a qualifying installation program102.86102.86
Regulation establishing continuing education for installers in states without a qualifying installation program71.0971.09
Regulation establishing recordkeeping requirements for installers in states without a qualifying installation program. Requires that all information must be kept for 5 years62.0262.02

1. Liability Insurance—Section 3286.205(d) of the proposed rule required an applicant for an installation license to provide evidence of general liability insurance in the amount of at least $1 million. The Department received comments suggesting eliminating or reducing the limits on the provision. Additional commenters suggested including a surety or insurance bond to protect the consumers from faulty installation designs or incomplete work.

The Department agrees with the commenters that surety or insurance bonds would provide better protection to the consumer than the liability insurance requirement. Therefore, the Department replaced the liability insurance requirement in the proposed rule with a surety bond/insurance requirement that is sufficient to cover the cost of repairing all damage to the home and its supports caused by the installer during the installation of the home. (See § 3286.205(d) in the final rule). This change also reduced the burden on small entities.

2. Inspections—Section 3286.505 of the proposed rule required each manufactured home installed in states where HUD administers the installation program to be inspected. Section 605 of the Act (42 U.S.C. 5404) calls for the establishment of an installation program that includes inspection of the installation of manufactured homes. Many commenters suggested inspecting less than 100 percent of all installations. The Department does not have any evidence that suggests such an inspection program would provide sufficient consumer protection; therefore, the final rule remains unchanged.

3. Installer Training—Section 3286.205(b)(1) of the proposed rule required an applicant for an installation license to complete 12 hours of training in states where HUD administers the installation program. Section 605 of the Act (42 U.S.C. 5404) calls for the establishment of an installation program that includes installer training. The Department did not receive any comments regarding the initial training of installers; therefore, the final rule remains unchanged.

4. Installer Continuing Education—Section 3286.205(b)(2) of the proposed rule required the licensed installer in states where HUD administers the installation program to complete 8 hours of continuing education during the 3-year license period to qualify for renewal of an installation license. The Department did not receive any comments regarding the continuing education requirement for installers; therefore, the final rule remains unchanged.

5. Installer Records—Section 3286.413 of the proposed rule required that installers maintain the required records for 5 years after the installer certifies completion of the home in states where HUD administers the installation program. Fifteen commenters suggested reducing the record retention requirement to 3 years. The Department agreed and changed the record retention requirement to 3 years in the final rule.

Description and Estimated Number of Small Entities Regulated

The final rule will apply to any business that manufactures, sells or leases, or installs manufactured homes. The rule also contains requirements for persons to qualify to provide the training required for installers. This rule also establishes requirements that must be met by a state to implement and administer its own installation program in such a way that the state would not be covered by the HUD-administered installation program.

The rule has differing requirements for the regulated entities depending on whether the home is being installed in a state with a qualified installation program or a state covered by the HUD-administered program.

The information presented in Table 2 was gathered from data collected by the Office of Manufactured Housing Programs based on the available data for 2006. The number of states expected to administer an installation program is estimated based on close correspondence with state representatives regarding the state's intentions.

Table 2.—Regulated Entities and Small Entities

North American Industrial Classification ScheduleDescription of primary entityNumber of regulated entitiesSmall Business Administration size standardNumber of small entitiesPercentage of regulated entities
All States—The requirements in Subpart A are applicable in all states
321991Manufacturers222500 employees19889
453930Retailers5151500 employees5151100
States Without Installation Programs—The requirements in Subparts B through H are applicable in these states
453930Retailers340500 employees340100
238990Installers1021$12 million1021100
611519Trainers50$6 million50100
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States With Installation Programs—The requirements in Subpart I are applicable in these states
States3550,000 population00

Description of the projected reporting, recordkeeping, and other compliance requirements of the final rule, including an estimate of the classes of small entities that will be subject to the requirement and the type of professional skills necessary for preparation of the report or record.

The final rule contains information collection requirements, installer licensing requirements, installer surety bond/insurance requirements, installation inspection requirements, installer trainer registration, and certification of states administering an installation program. Appendix A provides a detailed cost analysis of each section of the final rule.

Identification, to the extent practicable, of all relevant federal rules that may duplicate, overlap, or conflict with the final rule.

The Department is unaware of any conflicting federal rules. The final rule requires similar information to that required in 24 CFR 3282.552, which requires manufacturers to submit monthly label reports to their Production Inspection Primary Inspection Agency (IPIA). Section 3282.553 (24 CFR 3282.553) requires each IPIA to provide the information in the monthly label reports to the Department. This information is currently provided on OMB-approved form HUD-302. Section 3286.9 in the final rule requires the manufacturer to provide similar information to the Department for the purposes of installation.

To eliminate the possible duplication of reporting requirements, the Department revised form HUD-302 such that the information required in 24 CFR 3282.552 and 3286.9 may be provided in a single form completed by the manufacturer. This revised form is part of the Department's Paperwork Reduction Act submission.

Description of any significant alternatives that accomplish the stated objectives of applicable statutes that minimize any significant economic impact of the proposed rule on small entities, including alternatives considered.

The section Summary of Significant Issues Raised by Public Comment discusses the five regulatory requirements in the proposed and final rules that have the greatest economic impact on small entities. Additional alternatives were also considered during the development of the final rule as a result of the public comment.

Alternative 1. Section 3286.5(b)(2) requires the manufacturer to include instructions for supporting the manufactured home temporarily, pending the first siting of the home for occupancy.

Alternative Considered—The Department considered eliminating this requirement as the result of public comment; however, the importance of assuring that the temporary supports will be sufficient to prevent the home and its transportable sections from being brought out of conformance with the Construction and Safety Standards in 24 CFR part 3280 prior to sale is a necessary consumer protection considering the small costs associated with this section. Furthermore, the Department received additional comments stating the provisions are beneficial and should remain in the final rule.

Alternative 2. Section 3286.7(b) requires the retailer to provide the purchaser or lessee with a consumer disclosure prior to the purchase or lease of a manufactured home.

Alternative Considered—The Department considered eliminating this requirement as a result of public comment; however, the majority of public comment was in favor of the disclosure because of the importance of consumer protection during the purchase or lease of a manufactured home. This consumer protection justifies the small costs associated with this section.

Alternative 3. Section 3286.9(d) of the proposed rule required the manufacturer to include installation instructions in each home regardless of state.

Alternative Considered—A single commenter suggested requiring the manufacturer to provide installation instructions only in homes installed in states where HUD administers the installation program. Section 605 of the Act (42 U.S.C. 5404) requires the manufacturer to provide the design and instructions for the installation of each manufactured home, that have been approved by a design approval inspection agency; therefore, the requirement is consistent with the statutory requirement. (See § 3286.9(b) of the final rule.)

Alternative 4. Section 3286.13(a) of the proposed rule required the retailer or distributor to maintain for 5 years a copy of the sales or lease record for all homes sold or leased regardless of state.

Alternative Considered—The Department revised the final rule requiring the retailer or distributor to maintain a copy of the sales or lease record for homes sold or leased in states where HUD administers the installation program for 3 years (See section 3286.113(e) of the final rule). This reduces the recordkeeping burden on retailers and distributors.

Alternative 5. Section 3286.103(a) of the proposed rule required retailers and distributors to provide the purchaser with a copy of either:

“(1) The manufacturer's DAPIA-approved installation instructions for the home; or

(2) If the installation requires a design that is different from that provided by the manufacturer, an installation design and instructions that do not take the home out of compliance with the construction and safety standards in part 3280 of this chapter. * * *”

Many commenters agreed that the retailer should provide the purchaser with a copy of the DAPIA-approved installation instructions for every home in states where HUD administers the installation program. However, many commenters said the retailer should not be required to provide an installation design and instructions that differ from the DAPIA-approved installation instruction if the retailer has not agreed to provide any setup in connection with the sale of the home and the installation requires a design that is different from that provided by the manufacturer for the home. HUD agrees that the retailer or manufacturer should provide the installation design and instructions only for installations that require designs that differ from those provided by the manufacturer when the retailer or Start Printed Page 35277manufacturer agrees to provide any setup in connection with the sale of the home. The proposed rule placed the entire burden of providing the installation instructions on the retailer.

Accordingly, the final rule has been revised to require: (1) The retailer to provide the purchaser with a copy of the DAPIA-approved installation instructions for each manufactured home, and (2) the retailer or manufacturer to provide to the installer the installation design and instructions for installations that require designs that differ from those provided by the manufacturer, when the retailer or manufacturer agrees to provide any setup in connection with the sale of the home (See § 3286.103(b) of the final rule).

Alternative 6. Section 3286.211(a) of the proposed rule set an expiration date of 3 years for installation licenses issued in states where HUD administers the installation program.

A single commenter suggested extending the term of the license to 5 years to reduce the burden on installers. Another commenter suggested reducing the licensing term to one year to ensure installers are knowledgeable of new installation requirements. The term of the license remains 3 years in the final rule to balance the burden on installers and HUD, while ensuring installers are kept up to date on updates to the Model Installation Standards.

Alternative 7. Record Retention Requirements—The proposed rule requires that installers, retailers, and trainers maintain the required records for 5 years in states where HUD administers the installation program.

Alternative Considered—The Department agreed with the 15 commenters that suggested reducing the record retention requirement to 3 years. The Department agreed and changed the record retention requirement to 3 years in the final rule, thereby reducing record retention burden on small entities. Start Printed Page 35278

Appendix A.—24 CFR part 3286: Manufactured Housing Installation Program Cost Impact Analysis Matrix

SectionRegulated partyNumber of parties affectedNumber of homesCost impact per single-section homeCost impact per multi-section homeAnnual cost impact per regulated partyTotal annual cost impactCost impact notes
§ 3286.1This section sets forth the purpose of Subpart A. The requirements in Subpart A apply to all manufactured homes regardless of the state of installation. There is no cost associated with this section.
§ 3286.2This section sets forth the applicability of all subparts. There is no cost associated with this section.
§ 3286.3This section sets forth terms and definitions in this part. There is no cost associated with this section.
§ 3286.5Manufacturer222135,000$0.87$0.87$527.03$117,000This section provides for an overview of the installation program including the HUD installation program, state installation programs, and manufacturer and retailer requirements. There is no associated cost with this section other than in § 3286.5(c)(2). Section 3286.5(c)(2) requires the manufacturer to include instructions for supporting the manufactured home temporarily and protecting the interior from damage, pending the first installation of the home for occupancy. The instructions must be adequate to assure that the temporary supports used will be sufficient to prevent the home and its transportable sections from being brought out of conformance with the construction and safety standards or its sections if stored on such supports for more than 30 days. This would include costs for third-party design review and approval (4 hours of DAPIA review and approval labor). The installation instructions themselves are already required under 24 CFR 3280. However, this review cost is a one-time annualized total cost averaged on a per-home basis. The Department estimates 20 hours to review and revise the instructions at $75 per hour for 78 manuals. This cost is averaged for 135,000 homes and the 78 manuals. (20*75*78)/135,000=$0.867/home.
§ 3286.7(a)Manufacturer222135,0002.552.551,551.89344,520Requires the manufacturer to put a notice in the consumer manual for reinstalled homes. There will be a cost to the manufacturer for this notice. This notice must be provided for ALL homes. The cost to the manufacturer would include the one time cost of developing the disclosure (one hour at $75 per hour per manual), the initial placement in the consumer manual (one hour at $15 per hour per manual), and the continued placement of the disclosure in the consumer manual (10 minutes at $15 per hour). This cost is averaged for 135,000 homes.{(1*75*78)+(1*15*78)+(0.1667*15*135,000)}/135,000=$2.55/home.
§ 3286.7(b)Retailer5151135,0005.365.36140.52723,825Requires the retailer to provide the purchaser or lessee with a consumer disclosure. The requirements of this disclosure are also provided for in this section. This notice must be provided for all homes. There will be a cost to the retailer associated with this disclosure. The cost to the retailer would include the one-time cost of developing the disclosure (one hour at $75 per hour) and providing the disclosure to the consumer before the sale of each home (10 minutes at $15 per hour). This cost is averaged for 135,000 homes. {(1*75*5151)+(0.1667*15*135,000)}/135,000=$5.36/home.
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§ 3286.9(a)Manufacturer222135,0002.502.501,520.27337,500This section requires manufacturers to provide the initial tracking information about each home to HUD. This must be done for all homes regardless of state. Much of this information is currently being provided by manufacturers via form HUD-302. The form HUD-302 will be revised to include the anticipated ship date. There is a cost associated to the manufacturer for providing this information. The cost to the manufacturer will be the time required to provide this additional information to HUD, estimated at 10 minutes per home at $15 per hour. This cost is averaged for 135,000 homes. (0.1667x15*135,000)/135,000=$2.50/home.
§ 3286.9(b)This section requires manufacturers to provide a copy of the DAPIA-approved installation instructions with the home. The costs related to the revisions to the manufacturer's installation instructions have been accounted for in the Model Manufactured Home Installation Standards rule; therefore, the cost is not considered here.
§ 3286.11Manufacturer, Retailer, Installer20,827135,00040.0040.00259.285,400,000This section deals with the temporary storage of units. There is a cost associated with the provision requiring the temporary installation instructions. This cost was accounted for in § 3286.5(c) above. There is a cost to the manufacturer, retailer, or installer associated with the temporary support of the home and protecting the interior of the home from damage. The cost is estimated at one additional hour for the support and protection of the home (one hour at $40 per hour). The estimate includes the extra time for supporting each home (135,000). (one hour*40*135,000)=$5,400,000 or $40/home.
§ 3286.13This section provides that any provision of a contract or agreement entered into by a manufactured home purchaser that seeks to waive any recourse to either the HUD installation program or a state-qualifying installation program is void. This section does not have an associated cost impact.
§ 3286.15This section states that the Secretary will seek input from the MHCC when revising the installation program regulations in this part 3286, by providing the MHCC an opportunity to comment on any revision. This section does not have any associated cost impact.
§ 3286.101This section provides for the purpose of Subpart B to establish the systems for tracking and certifying a manufactured home installation that is to be completed in accordance with the HUD-administered installation program. There is no cost associated with this provision.
§ 3286.102(a)Manufacturer2226,7502.502.5076.0116,875This section requires manufacturers to provide notice to the retailer that the tracking information is provided to HUD and that the retailer must update the information as required. This must be done for all homes where HUD administers the installation program. There is a cost associated with this requirement to the manufacturer. The cost to the manufacturer will be the time required to provide a copy of the required form HUD-302 to the retailer. This is estimated at 10 minutes per home at $15 per hour. This cost is averaged for 6,750 homes. (0.1667x15*6,750)/6,750=$2.50/home.
Start Printed Page 35280
§ 3286.102(b)Manufacturer2226,7503.543.54107.6423,895This section requires manufacturers to include in its installation instructions for the home a notice that the home is required to be installed in accordance with the two acceptable methods. This must be done for all homes where HUD administers the installation program. There is a cost associated with this requirement to the manufacturer. The cost to the manufacturer entity would include the one-time cost of developing the notice (one hour at $75 per hour), the initial placement in the installation manual (one hour at $15 per hour), and the continued placement of the notice in the installation manual (10 minutes at $15 per hour). This cost is averaged for 6,750 homes. {(1x75x78)+(1x15*78)+(0.1667*15*6,750)}/6,750=$3.54 home.
§ 3286.103(a)(1)Retailer3406,750$2.502.5049.6316,875For each manufactured home sold to a purchaser in a state in which HUD administers an installation program, the retailer must ensure that the purchaser is provided with a copy of the installation instructions. This will have an associated cost to the retailer in HUD states. Since the installation instructions are required to be provided by the manufacturer, with the home, the cost to the retailer will be the cost of providing the instructions to the consumer, estimated at 10 minutes per home at $15 per hour. This cost is averaged for 6,750 homes. 6,750(0.16667*15)=$16,875.
§ 3286.103(a)(2)Manufacturer2226,75037.5037.501,140.20253,125Requires that the manufacturer/DAPIA approve installation designs and instructions if the installation requires a design that is different from the installation instructions required and accounted for in the Model Manufactured Home Installation Standards. There is a cost associated with this requirement to the manufacturer. The cost to the manufacturer entity would include the cost of approving the site-specific designs estimated to occur in 20% of installations. The time is estimated at 2.5 hours at $75/hr. This cost is averaged for 6,750 homes. 0.2*6,750*2.5*75=$253,125.
§ 3286.103(b)Retailer3406,7502.132.1342.1914,345When the retailer agrees to provide any set up in connection with the sale of the home, the retailer must provide a copy of the same DAPIA-approved installation instructions or, as applicable, installation design and instructions to each company; or, in the case of a sole proprietor, the individual who performs set up or installation work on the home. This will have an associated cost to the retailer in HUD states. Since the installation instructions are required to be provided by the manufacturer with the home, the cost to the retailer will be the cost of providing the installation instructions, estimated at 10 minutes per home. Assume the retailer will provide set up in connection with the sale of the home in 85% of all sales as a conservative estimate. This cost is averaged for 6,750 homes. 0.85*0.16667*15*6,750=$14,345.
§ 3286.105This section requires that the installer that installs a manufactured home in a state that does not have a qualifying installation program be certified or licensed in accordance with Subpart C. The cost associated with this is evaluated in Subpart C.
Start Printed Page 35281
§ 3286.107These sections set forth requirements that, at a minimum, the installation must comply with the manufacturer's installation instructions or the alternative design by a professional engineer or registered architect approved by the manufacturer and DAPIA. The cost associated with these requirements was evaluated as part of the final rule for the Model Manufactured Home Installation Standards and § 3286.103; therefore, is not included here.
§ 3286.109The installer or the retailer must arrange for the inspection of the installation work on any manufactured home. Before the sale of the home is considered complete, the installer must certify, and the inspector must verify, the home as having been installed in conformance with the requirements of § 3286.109(a). The requirements for installer certification are set and accounted for in § 3286.111.
§ 3286.111(a)(1)Installer1,0216,75020.0020.00132.22135,000When the installation work is complete, an installer must certify that: The manufactured home has been installed in compliance with the manufacturer's installation instructions or with an installation design and instructions that have been certified by a professional engineer or registered architect as providing a level of protection for occupants of the home that equals or exceeds the protection provided by the installation standards in part 3285 of this chapter and the installation of the home has been inspected as required by part 3286 and an inspector has verified the installation as meeting the requirements of this part 3286. There will be costs associated with the provisions in this section to the installer for homes that are sited in states without a qualifying installation program. The cost to the installer would include the time to complete specific information required for each individual certification (30 minutes at $40 per hour). This cost is averaged for 6,750 homes. (0.5*40*6,750)=$135,000.
§ 3286.111(a)(2)Installer1,0216,750300.00350.002,214.742,261,250This section provides that the installation of every manufactured home that is subject to the HUD-administered installation program is required to be inspected for each of the installation elements to ensure it complies with the requirements of part 3285 of this chapter. This provision will have an associated cost for the installations in that they are subject to the HUD-administered installation program. The cost associated with this provision will be borne by the installer. Many of the homes inspected by local jurisdictions may not incur an additional cost for the inspection beyond the existing permitting and inspection fees already borne by the installer. However, in areas without local jurisdictions, the installer will have to pay a qualified third party to inspect the installation. Estimating that each inspection for a single-wide unit and double-wide unit will take 3 hours and 3.5 hours, respectively, at a rate of $100 per hour for each installation in a HUD-administered installation state provides a conservative estimate of the cost.
§ 3286.111(b)Installer1,0216,7502.502.5016.5316,875The installer must provide a signed copy of its certification to the retailer that contracted with the purchaser for the sale of the home, and to the purchaser or other person with whom the installer contracted for the installation work. There will be costs associated with the provisions in this section to the installer for homes that are sited in states without a qualifying installation program. The cost to the retailer will be the cost of providing the information to HUD, estimated at 10 minutes per home at $15 per hour. This cost is averaged for 6,750 homes. 6,750*(0.16667*15)=$16,875.
Start Printed Page 35282
§ 3286.113(a)Retailer3406,7503.753.7574.4525,312The retailer or distributor of the home must provide HUD with tracking information about the home within 30 days from the time that a purchaser or lessee enters into a contract to purchase or lease a manufactured home. This must be done for all homes in states in which HUD administers the installation program. There is a cost associated with this requirement to the retailer. The cost to the retailer will be the time required to provide this information to HUD estimated at 15 minutes per home at $15 per hour. This cost is averaged for 6,750 homes. (0.25x15*6,750)/6,750=$3.75/home.
§ 3286.113(b)Retailer3406,7503.753.7574.4525,312In addition to the information required to be provided by the retailer pursuant to § 3286.113(a), within 30 days from the date of installation, the retailer must provide HUD with additional information regarding the installation. There will be costs associated with the provisions in this section to the retailer for homes that are sited in states without a qualifying installation program. The cost to the retailer would include the time to complete specific information required for each individual concurrence (15 minutes at $15 per hour). This cost is averaged for 6,750 homes. (0.25*15*6,750)/6,750=3.75.
§ 3286.113(c)RetailerThis section provides for the method in which the information in §§ 3286.113(a) and (b) can be provided. There is no cost associated with this provision.
§ 3286.113(d)Retailer3406750.380.387.442,531This section provides for the correction of information in §§ 3286.113(a) and (b). There is a cost associated with this provision to the retailers in states where HUD administers the installation program. The cost to the retailer would include the time to correct the specific information. It is estimated that 10% of the information will have to be corrected taking 15 minutes for each response at $15 per hour. This cost is averaged for 6,750 homes in HUD states. 0.1*(0.25*15*6,750)=$2,531.25. The cost per home=$2,531.25/6,750=$0.38.
§ 3286.113(e)Retailer3406,75041.3041.30820.00278,800This section requires that retailers must maintain sales records for 3 years. There is a cost associated with this provision to the retailers in states where HUD administers the installation program. The cost is estimated as the required time (filing and organization of files at 4 hours/month at $15 hour) and materials to keep such storage (file cabinets and computer disk space $100). 340($100+4*12*$15)=$278,800.
§ 3286.115This section defines the date of installation. There is no cost associated with this provision.
§ 3286.117This section defines the completion of sale. There is no cost associated with this provision.
§ 3286.201This section outlines the purpose of Subpart C, which is to establish the requirements for a person to qualify to install a manufactured home in accordance with the HUD-administered installation program. No costs are associated with this section.
§ 3286.203This section provides when a license is needed and when a license is not needed. No costs are associated with this provision. The cost of the license is addressed in § 3286.205 and § 3286.207.
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§ 3286.205(a)This section provides for the required experience for installers in states without a qualifying installation program. There is no cost associated with this provision.
§ 3286.205(b)(1)Installer1,0216,750102.86102.86680.00694,280This section provides for the required initial training for installers in states without a qualifying installation program. There is a cost associated with this provision for installers. The cost associated with this requirement is estimated as the cost for the 12-hour training class (approximately $200) and the missed wages (12*$40 per hour) while attending the class. This cost is averaged for 6,750 homes. (200+(12*40))*1,021=$694,280.
§ 3286.205(b)(2)Installer1,0216,75071.0971.09470.00479,870This section provides for the continuing education for installers in states without a qualifying installation program. There is a cost associated with this provision for installers. The cost associated with this requirement is estimated as the cost for the 8-hour continuing education classes (approximately $150) and the missed wages while attending the class (8*40 per hour). These provisions will not be applicable until 3 years after the implementation of the program, i.e., when the initial licenses begin to expire. This cost is averaged for 6,750 homes. (150+(8*40))*1,021=$479,870.
§ 3286.205(c)Installer1,0216,7509.669.66130.00132,730This section provides for the testing requirement for installers in states without a qualifying installation program. There is a cost associated with this provision for installers. The cost associated with this requirement is estimated as the cost for the testing fee (approximately $50) and the missed wages while attending the exam (2)*$40 per hour. This cost is averaged for 6,750 homes. (50+(2*40))*1,021=$132,730.
§ 3286.205(d)Installer1,0216,750226.89226.891,500.001,531,500This section provides for the surety bond and insurance requirements for installers in states without a qualifying installation program. There is a cost associated with this provision for installers. The cost associated with the premium estimated from insurance company and surety bond companies will be approximately $1,500 per year. This cost is averaged for 6,750 homes.
§ 3286.207(a)Installer1,0216,7506.056.0540.0040,840This section requires the installer to complete an application for the license in states without a qualifying installation program. There will be costs associated with this provision to installers in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the installer to read the instructions and complete the form. The cost is estimated at one hour at $40 per hour.
§ 3286.207(b)Installer1,0216,7506.056.0540.0040,840This section requires the installer to provide proof of experience in states without a qualifying installation program. There will be costs associated with this provision to installers in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the installer to provide written verification of the experience. The cost is estimated at one hour at $40 per hour.
§ 3286.207(c)Installer1,0216,7501.511.5110.0010,210This section requires the installer to provide proof of training in states without a qualifying installation program. There will be costs associated with this provision to installers in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the installer to copy the training certificate of completion. The cost is estimated at 0.25 hour at $40 per hour.
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§ 3286.207(d)Installer1,0216,7501.511.5110.0010,210This section requires the installer to provide proof of the surety bond or insurance in states without a qualifying installation program. There will be costs associated with this provision to installers in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the installer to copy the appropriate documents and provide proof of payment. The cost is estimated at 0.25 hour at $40 per hour.
§ 3286.207(e)Installer1,0216,7500.500.503.333,403This section requires the installer to provide a list of states in which they hold or have held installer licenses. There will be costs associated with this provision to installers in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the installer to provide the list of states. It is expected that this will only apply to approximately half of the applicants. The cost is estimated at 5 minutes at $40 per hour.
§ 3286.207(f)(1)This section provides for the issuance or denial of an installation license. No cost is associated with this provision.
§ 3286.207(f)(2)Installer1,0216,7500.090.090.59600This section allows the applicant who is denied an installation license an opportunity for a presentation of views for the purpose of establishing the applicant's qualifications to obtain an installation license. There will be costs associated with this provision to installers in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the installer to request the presentation of views. It is estimated that 2% of the applicants applying for an installation license will request such a presentation (approximately 20 installers). The cost is estimated at 45 minutes at $40 per hour for 20 applicants. (45/60*$40*20)/6,750=$0.09 per home.
§ 3286.207(g)This section does not allow transfer of licenses to other entities. No cost is associated with this provision.
§ 3286.209Installer1,0216,7500.090.090.59600This section provides for the oversight of licensed installers; the processes for denial, suspension, or revocation of an installation license; and the reinstatement of an installation license in states without a qualifying installation program. There are no costs associated with the provisions in this section other than paragraph (d) in this section. The cost associated with this requirement is estimated as the cost for the installer to apply for a new license. It is estimated that less than 1% of the applicants (10) will have their licenses denied, suspended, or revoked. The cost is estimated at 90 minutes at $40 per hour for 10 applicants. (90/60*$40*10)/6,750=$0.09 per home.
§ 3286.211Installer1,0216,7506.056.0540.0040,840This section provides for expiration and the process for renewal of an installation license in states without a qualifying installation program. There are costs associated with the provisions in paragraph (b) in this section to installers. The cost associated with this requirement is estimated as the cost for the installer to read the instructions and complete the form. The cost is estimated at one hour at $40 per hour.
Start Printed Page 35285
§ 3286.301This section discusses the purpose of Subpart D. The purpose is to establish the requirements for a person to qualify to provide the training required under Subpart C of this part. This training is required for manufactured home installers who want to be licensed in accordance with the HUD-administered installation program. No costs are associated with this provision.
§ 3286.303(a)This section requires that qualified trainers must adequately address the curriculum and instruction-time requirements established in Subparts C and D of this part. There is no cost associated with this provision.
§ 3286.303(b)Trainer506,75012.3012.301,660.0083,000This section requires qualified trainers to maintain records of the times, locations, names of attendees at each session, and content of all courses offered. There is a cost associated with this provision to trainers in states without a qualifying installation program. The cost is estimated as the required time (filing and organization of files at 2 hours a week at $15 per hour) and materials to keep such storage (file cabinets and computer disk space $100). This cost will be passed on to installers through the cost of the training class, and it is conceivable that the installer will pass this cost to the consumer.
§ 3286.303(c)Trainer506,7501.511.51204.2010,210This section requires qualified trainers to provide completion certificates to course attendees. There is a cost associated with this provision to trainers in states without a qualifying installation program. The cost is estimated at 10 minutes per certificate at $60 per hour. This cost will be passed on to installers through the cost of the training class, and it is conceivable that the installer will pass this cost to the consumer.
§ 3286.303(d)This section requires qualified trainers to retain all records for 3 years. There is a cost associated with this provision to trainers in states without a qualifying installation program. The cost is estimated in § 3286.303(b) above.
§ 3286.303(e)This section may allow qualified trainers to administer exams. Since this is not a requirement, there is no cost associated with this provision.
§ 3286.305This section provides for the installation trainer criteria, including experience and curriculum. There are no costs associated with the provisions in this section other than paragraph (c) of this section. Paragraph (c) requires registration to be considered a qualified trainer. An individual or other training entity must submit to HUD certification that training provided will meet the requirements in §§ 3286.308 and 3286.309. The cost associated with this requirement is considered in § 3286.307(c)(2).
§ 3286.307(a)Trainer506,7500.440.4460.003,000This section requires the trainer to submit an application. There is a cost associated with this provision. The cost associated with this requirement is estimated as the cost for the trainer to read the instructions and complete the form. The cost is estimated at one hour at $60 per hour. This cost will be passed on to installers through the cost of the training class, and it is conceivable that the installer will pass this cost to the consumer.
§ 3286.307(b)Trainer506,7500.440.4460.003,000This section requires the trainer to submit proof of experience. There is a cost associated with this provision. The cost associated with this requirement is estimated as the cost for the installer to provide written verification of the experience. The cost is estimated at one hour at $60 per hour. This cost will be passed on to installers through the cost of the training class, and it is conceivable that the installer will pass this cost to the consumer.
Start Printed Page 35286
§ 3286.307(c)(1)Trainer506,7500.110.1115.00750This section requires the trainer to submit a list of all states where the applicant has had a similar training qualification revoked, suspended, or denied. There is a cost associated with this provision to the trainer. The cost associated with this requirement is the cost for the trainer to provide the list of states. The cost is estimated at 0.25 hour at $60 per hour. This cost will be passed on to installers through the cost of the training class, and it is conceivable that the installer will pass this cost to the consumer.
§ 3286.307(c)(2)Trainer506,7500.220.2230.001,500This section requires the trainer to submit a certification that training provided is in accordance with Subpart D and will meet the curriculum requirements established in §§ 3286.308 or 3286.309, as applicable. There is a cost associated with this provision to the trainer. The cost associated with this requirement is estimated as the cost for the trainer to provide the certification. The cost is estimated at 0.50 hour at $60 per hour. This cost will be passed on to installers through the cost of the training class, and it is conceivable that the installer will pass this cost to the consumer.
§ 3286.307(d)Trainer506,7500.010.010.9045This section provides for the confirmation or denial of trainer qualification. There will be costs associated with this paragraph in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the trainer to request the presentation of views. It is estimated that 2% of the applicants applying to be qualified trainers will request such a presentation. The cost is estimated at 45 minutes at $60 per hour for 2% of the applicants. (45/60*$60*0.02)(50)/6,750=$0.01 per home.
§ 3286.307(e)This section prohibits the assignment of trainer qualification to other entities. There is no cost associated with this section.
§ 3286.308This section provides for the training curriculum requirements. There is no cost associated with the provisions in this section.
§ 3286.309This section provides for the continuing education trainer and curriculum requirements. There is no cost associated with the provisions in this section.
§ 3286.311Trainer506,7500.010.010.9045This section provides for the suspension or revocation of the trainer's qualification. There are no costs associated with the provisions in this section other than paragraphs (b) and (d) of this section. Paragraphs (b) and (d) provide for the presentation of views for the qualified trainer prior to suspension or revocation of qualification status. There will be costs associated with this provision to trainers in states without a qualifying installation program. The cost associated with this requirement is estimated as the cost for the installer to request the presentation of views. It is estimated that 2% of the qualified trainers will request such a presentation. The cost is estimated at 45 minutes at $60 per hour for 2% of the qualified trainers. (45/60*$60*0.02)(50)/6,750=$0.01 per home.
Start Printed Page 35287
§ 3286.313Trainer506,7500.440.4460.003,000This section provides for the process for renewal of a trainer's qualification in states without a qualifying installation program. There are costs associated with the provisions in paragraph (b) in this section to trainers. The cost associated with this requirement is estimated as the cost for the trainer to read the instructions and complete the form for renewal. The cost is estimated at one hour at $60 per hour. This cost will be passed on to installers through the cost of the class and is a potential increase to the price of the home.
§ 3286.401This section discusses the purpose of Subpart E. The purpose of Subpart E is to set out the responsibilities of the installer who is accountable for the installation of a manufactured home in compliance with the requirements of the HUD-administered installation program. There is no cost associated with this section.
§ 3286.403This section provides that an installer of manufactured homes must comply with the licensing requirements set forth in Subpart C of this part. There is no cost associated with this section. The cost of licensing was done in the analysis of Subpart C.
§ 3286.405(a)Installer1,0216,75020.0020.00132.22135,000This section requires that the installer verify that the site is appropriate for the installation. There will be a cost associated with this requirement. The cost associated with this requirement will require the installer to conduct a site investigation. It is estimated that this investigation will take 0.5 hour at $40 per hour. The cost will be averaged for 6,750 homes.
§ 3286.405(b)Installer1,0216,7500.200.201.331,360This section requires that the installer notify the retailer, purchaser, and HUD if the site is not appropriate for the installation. There will be a cost associated with this requirement. The cost associated with this requirement is estimated as the cost for the installer to provide the written notification to the retailer. This notification is estimated to take 0.5 hour at $40 per hour. It is estimated that this notification will only be required in 1% of installations. The cost will be averaged for 6,750 homes.
§ 3286.405(c)Installer1,0216,7500.200.201.331,360This section requires that the installer notify the manufacturer and retailer if a failure to comply with the construction and safety standards is noticed during the installation. There will be a cost associated with this requirement. The cost associated with this requirement is estimated as the cost for the installer to provide the written notification to the manufacturer and retailer. This notification is estimated to take 0.5 hour at $40 per hour. It is estimated that this notification will only be required in 1% of installations. The cost will be averaged for 6,750 homes.
§ 3286.405(d)Retailer3406,7500.100.102.00680This section requires that the retailer provide a copy of the notification in (b) and (c) above to any subsequent installers. There will be a cost associated with this requirement. The cost associated with this requirement is estimated as the cost for the retailer to provide a copy of the notification above to any subsequent installer. This notification is estimated to take 15 minutes at $40 per hour. The cost will be averaged for 1% of homes installed in states where HUD administers the installation program.
§ 3286.407This section requires that the installer be responsible for the work performed by each person engaged to perform installation tasks on a manufactured home in accordance with the HUD-administered installation program. There is no cost associated with the requirement.
§ 3286.409This section provides information regarding the inspection requirements. There is a cost associated with the requirement. The cost regarding the inspection is evaluated in § 3286.111(a)(2).
Start Printed Page 35288
§ 3286.411(a)InstallerWhen the installation work is complete, an installer must certify that: The manufactured home has been installed in compliance with the manufacturer's installation instructions or with an installation design and instructions that have been certified by a professional engineer or registered architect as providing a level of protection for occupants of the home that equals or exceeds the protection provided by the installation standards in part 3285 of this chapter, and the installation of the home has been inspected as required by this part § 3286 and an inspector has verified the installation as meeting the requirements of this part § 3286. There will be costs associated with the provisions in this section to the installer for homes that are sited in states without a qualifying installation program. This provision is the same as § 3286.111(a); therefore, the cost is not calculated here.
§ 3286.411(b)InstallerThe installer must provide a signed copy of its certification to the retailer that contracted with the purchaser for the sale of the home, and to the purchaser or other person with whom the installer contracted for the installation work. There will be costs associated with the provisions in this section to the installer for homes that are sited in states without a qualifying installation program. This provision is the same as § 3286.111(b); therefore, the cost is not calculated here.
§ 3286.413Installer1,0216,750124.03124.03820.00837,220This section provides for the record-keeping requirements for installers. It outlines all of the information that must be kept and mandates that it be kept for 3 years. This section will have an associated cost to the installer in states without qualifying installation programs. The cost is estimated as the required time (filing and organization of files at 4 hours a month at $15 per hour) and materials to keep such storage (file cabinets and computer disk space $100). The cost will be averaged for the 6,750 homes.
§ 3286.501This section discusses the purpose of Subpart F. The purpose of Subpart F is to provide additional detail about the inspection that must be performed by a qualified third-party inspector before the installation of a manufactured home may be approved by the inspector and certified by the installer under the HUD-administered installation program. There is no cost associated with this section.
§ 3286.503(a)Installer1,0216,75020.0020.00132.22135,000This section requires the installer to arrange for an inspection and provides for the timing of the inspection. There is a cost associated with this requirement to the installer. It is estimated that the installer will take 0.5 hour at $40 per hour per installation to arrange for the inspection of the installation. 0.5*40*6,750=$135,000.
§ 3286.503(b)This section provides for the retailer disclosure requirement. There are costs associated with the retailer disclosure requirements; however, this is accounted for in § 3286.7(b).
§ 3286.503(c)Installer1,0216,75020.0020.00132.22135,000This section requires the installer to provide a copy of the installation instructions to the inspector. There is a cost associated with this provision and it is estimated at $20 per installation.
Start Printed Page 35289
§ 3286.505InstallerThis section provides that the installation of every manufactured home that is subject to the HUD-administered installation program is required to be inspected for each of the installation elements to ensure it complies with the requirements of part 3285 of this chapter. This provision will have an associated cost for the installations that are subject to the HUD-administered installation program. The cost associated with this provision is accounted for in § 3286.111(a)(2).
§ 3286.507(a)This section requires that when an inspector is satisfied that the manufactured home has been installed in accordance with the requirements; the inspector must provide verification in writing to the installer. There are costs associated with these provisions which have been included in § 3286.111(a)(2).
§ 3286.507(b)InstallerOnce an installation has been inspected and verified, the installer is permitted to certify the installation as provided in § 3286.111. There are costs associated with these provisions; however, they have been determined in § 3286.111(a).
§ 3286.509(a)Installer1,0216,7502.252.2514.8815,187This section provides for the reinspection of the installation upon failure to pass. This section contains procedures for failed inspections, request for review, and cost for reinspection. This section does have costs associated with the provisions. It is estimated that 5% of homes will need to be reinspected in accordance with this section. The cost is estimated at 30 minutes for the inspector to notify the installer at $90 per hour. 0.05*(30/60*90)*6,750=$15,187.50.
§ 3286.509(b)Installer1,0216,75010.0010.0066.1167,500This section provides that the cost of reinspection of the installation upon failure to pass must be paid by the retailer or installer. This section does have a cost associated with it and is estimated at $200 for the reinspection and verification. It is estimated that only 5% of homes will require reinspection.
§ 3286.511(a) and (b)This section provides the inspector qualifications and inspector independence clause in states that are subject to the HUD-administered installation program. There is no cost associated with these provisions.
§ 3286.511(c)Inspector4,0000.19750This section allows the inspector a presentation of views prior to suspension or revocation of an inspector's authority to inspect manufactured home installations. There is a cost associated with this provision. It is estimated that less than five inspectors a year will request a presentation of views. The cost would not have an impact on the cost of manufactured homes. The cost to the inspector is estimated at 1.5 hours at $100 per hour for five inspectors. (1.5 hours*$100)(5)=$750. This cost will not affect the cost of the manufactured home.
§ 3286.511(d)Inspector4,0000.19750This section allows the inspector whose qualification has been suspended or revoked to apply for reauthorization. There will be costs associated with this provision to the inspector. The cost associated with this requirement is estimated as then cost for the trainer to apply for qualifications. It is estimated that less than five inspectors will have their qualifications suspended or revoked. The cost is estimated at 90 minutes at $100 per hour for five inspectors. (90/60*$100*5)=$750. This cost will not affect the cost of the manufactured home.
Start Printed Page 35290
§ 3286.601This section discusses the purpose of Subpart G. The purpose of this subpart is to set out the requirements that apply to a retailer with respect to the federal installation requirements applicable to new manufactured homes that the retailer sells or leases and that will be installed in states that do not have qualifying installation programs. These requirements are in addition to other requirements that apply to retailers of manufactured homes pursuant to other parts of this chapter. There are no costs associated with these provisions.
§ 3286.603This section provides for retailer requirements at or before sale. Specifically, the retailer disclosure to the purchaser and temporary support. There are costs associated with this section; however, these costs have been calculated in § 3286.7(b).
§ 3286.605This section provides for retailer requirements after sale; specifically, the tracking of the installation, retailer concurrence on the certification, and other tracking and compliance requirements. There are costs associated with this section; however, these costs have been calculated for § 3286.113 and are not repeated here.
§ 3286.607Provides that the retailer is responsible for the reporting and recordkeeping requirements under § 3286.113. There are costs associated with this section; however, they have been determined in § 3286.113(e).
§ 3286.701Provides the purpose of Subpart H. The purpose of Subpart H is to set out the mechanisms by which manufacturers, retailers, distributors, installers, and installation inspectors will be held accountable for assuring the appropriate installation of manufactured homes. There are no costs associated with this section.
§ 3286.703All24,927450Provides for penalties and injunctive relief for failures to comply, the presentation-of-views, and the procedures for investigations. These provisions have an associated cost with the presentation-of-views requirement. It is estimated that less that 10 requests for presentation of views will be requested that have not been accounted for in the other specific section. The cost would not have an impact on the cost of manufactured homes. The cost to the inspector is estimated at 45 minutes at $60 per hour for 10 instances. (45/60*$60)(10)=$450.
§ 3286.705Provides for the discussion of the dispute resolution program. These provisions do not have an associated cost.
§ 3286.801Provides the purpose of Subpart I. The purpose of Subpart I is to establish the requirements that must be met by a state to implement and administer its own installation program in such a way that the state would not be covered by the HUD-administered installation program. There are no costs associated with this section.
§ 3286.803Provides for the requirements for a qualified State Installation Program stating that a qualified State installation program supersedes the HUD-administered installation program, a state installation program must include the minimum elements to be approved, and the provisions for conditional acceptance. There are no costs associated with this section.
Start Printed Page 35291
§ 3286.805(a)State3580.002,800This section requires states seeking identification as a qualified installation program to submit a completed State Installation Program Certification Form to the Secretary for review and acceptance. There will be a cost to the state to complete this certification. The estimated cost will include the time of one staff person for 2 hours at $40 per hour. The cost would not have an impact on the cost of manufactured homes.
§ 3286.805(b)HUD will review the state plan and contact the state regarding the application. There is no cost associated with this provision.
§ 3286.805(c)State352.2980Provides for the presentation of views by the states if rejecting the certification. It is estimated that less than 1% of states applying to administer their own installation program will request a presentation of views. The cost to the state is estimated at 120 minutes at $40 per hour for 1 state application. (120/60*$40)(1)=$80. The cost would not have an impact on the cost of manufactured homes.
§ 3286.807State3540.001,400This section requires that states submit a new State Installation Program Certification Form to the Secretary for review every 3 years to maintain its status as having a qualified installation program. There will be a cost to the state to complete this certification. The estimated cost will include the time of one staff person for one hour at $40 per hour. The cost would not have an impact on the cost of manufactured homes.
§ 3286.809State352.2980This section states that whenever the Secretary finds that a state installation program fails to comply substantially with any provision of the installation program requirements or that the state program has become inadequate, the Secretary will notify the state of withdrawal of acceptance or conditional acceptance of the state installation program. There will be a cost to the state to complete this request. The estimated cost will include the time of one staff person for 1 hour at $40 per hour for an estimated 2 states. (1*40*2)=$80. The cost would not have an impact on the cost of manufactured homes.
§ 3286.811Provides that a state with a qualifying installation program will operate in lieu of HUD with respect to only the installation program established under Subparts B through H of this part § 3286. No state may permit its installation program, even if it is a qualified installation program under this part, to supersede the requirements applicable to any other aspect of HUD's manufactured housing program. There are no costs associated with this section.
§ 3286.813If a state installation program is included in a state plan approved in accordance with § 3282.302 of this chapter, the state installation program is subject to all of the requirements for such a state plan, including annual review by HUD. There are no costs associated with this section.
Start Printed Page 35292

Catalog of Federal Domestic Assistance

The Catalog of Federal Domestic Assistance number for Manufactured Housing is 14.171.

Start List of Subjects

List of Subjects in 24 CFR Part 3286

End List of Subjects Start Amendment Part

Accordingly, HUD adds a new part 3286 in chapter XX of Title 24 of the Code of Federal Regulations to read as follows:

End Amendment Part Start Part

PART 3286—MANUFACTURED HOME INSTALLATION PROGRAM

Subpart A—Generally Applicable Provisions and Requirements
3286.1
Purpose.
3286.2
Applicability.
3286.3
Definitions.
3286.5
Overview of installation program.
3286.7
Consumer information.
3286.9
Manufacturer shipment responsibilities.
3286.11
Temporary storage of units.
3286.13
Waiver of rights invalid.
3286.15
Consultation with the Manufactured Housing Consensus Committee (MHCC).
Subpart B—Certification of Installation in HUD-Administered States
3286.101
Purpose.
3286.102
Information provided by manufacturer.
3286.103
DAPIA-approved installation instructions.
3286.105
Requirement for installer licensing.
3286.107
Installation in accordance with standards.
3286.109
Inspection requirements—generally.
3286.111
Installer certification of installation.
3286.113
Information provided by retailer.
3286.115
Date of installation.
3286.117
Completion of sale date.
Subpart C—Installer Licensing in HUD-Administered States
3286.201
Purpose.
3286.203
Installation license required.
3286.205
Prerequisites for installation license.
3286.207
Process for obtaining installation license.
3286.209
Denial, suspension, or revocation of installation license.
3286.211
Expiration and renewal of installation licenses.
Subpart D—Training of Installers in HUD-Administered States
3286.301
Purpose.
3286.303
Responsibilities of qualified trainers.
3286.305
Installation trainer criteria.
3286.307
Process for obtaining trainer's qualification.
3286.308
Training curriculum.
3286.309
Continuing education—trainers and curriculum.
3286.311
Suspension or revocation of trainer's qualification.
3286.313
Expiration and renewal of trainer qualification.
Subpart E—Installer Responsibilities of Installation in HUD-Administered States
3286.401
Purpose.
3286.403
Licensing requirements.
3286.405
Installation suitability.
3286.407
Supervising work of crew.
3286.409
Obtaining inspection.
3286.411
Certifying installation.
3286.413
Recordkeeping.
Subpart F—Inspection of Installations in HUD-Administered States
3286.501
Purpose.
3286.503
Inspection required.
3286.505
Minimum elements to be inspected.
3286.507
Verifying installation.
3286.509
Reinspection upon failure to pass.
3286.511
Inspector qualifications.
Subpart G—Retailer Responsibilities in HUD-Administered States
3286.601
Purpose.
3286.603
At or before sale.
3286.605
After sale.
3286.607
Recordkeeping.
Subpart H—Oversight and Enforcement in HUD-Administered States
3286.701
Purpose.
3286.703
Failure to comply.
3286.705
Applicability of dispute resolution program.
Subpart I—State Programs
3286.801
Purpose.
3286.803
State qualifying installation programs.
3286.805
Procedures for identification as qualified installation program.
3286.807
Recertification required.
3286.809
Withdrawal of qualifying installation program status.
3286.811
Effect on other manufactured housing program requirements.
3286.813
Inclusion in state plan.
Start Authority

Authority: 42 U.S.C. 3535(d), 5404, and 5424.

End Authority

Subpart A—Generally Applicable Provisions and Requirements

Purpose.

(a) Purpose. The purpose of this part is to establish the regulations that are applicable to HUD's administration of an installation program that meets the requirements of sections 602 (42 U.S.C. 5401) and 605 (42 U.S.C. 5404) of the National Manufactured Housing Construction and Safety Standards Act of 1974. The purpose of this subpart A is to establish the regulations that are applicable with respect to all manufactured homes before they are sold to a purchaser. The requirements in subpart A apply regardless of whether the actual installation of a manufactured home is regulated by HUD or a state with a qualifying installation program.

(b) Implementation. This part is effective on October 20, 2008. Implementation will be undertaken in accordance with the phased-in schedule provided by notice published in the Federal Register.

Applicability.

(a) All states. The requirements in subpart A are applicable in all states.

(b) States without installation programs. The requirements in subparts B through H of this part are applicable only in those states where HUD is administering an installation program in accordance with this part.

(c) States with installation programs. The requirements in subpart I of this part are applicable to only those states that want to administer their own installation programs in lieu of the installation program administered by HUD in accordance with this part.

(d) Exclusion. None of the requirements of this part apply to:

(1) Any structure that a manufacturer certifies as being excluded from the coverage of the Act in accordance with § 3282.12 of this chapter; or

(2) Temporary housing units provided under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.) to victims of Presidentially declared disasters, when the manufactured home is installed by persons holding an emergency contractor license issued by the state in which the home is sited or installed by the Federal Emergency Management Agency; or

(3) Any manufactured home after the initial installation of the home following the first purchase of the home in good faith for purposes other than resale. State installation programs may regulate subsequent installations of manufactured homes.

(4) Any manufactured home installed on Indian reservations.

Definitions.

The following definitions apply in this part, except as otherwise noted in the regulations in this part:

Act means the National Manufactured Housing Construction and Safety Standards Act of 1974, 42 U.S.C. 5401-5425.

Certification of installation means the certification, provided by an installer under the HUD-administered installation program in accordance with § 3286.111, that indicates that the manufactured home has been installed in compliance with the appropriate design and instructions and has been inspected as required by this part. Start Printed Page 35293

Defect means any defect in the performance, construction, components, or material of a manufactured home that renders the home or any part thereof not fit for the ordinary use for which it was intended.

Design Approval Primary Inspection Agency (DAPIA) means a state agency or private organization that has been accepted by the Secretary, in accordance with the requirement of subpart H of part 3282, to evaluate and either approve or disapprove manufactured home designs and quality control procedures.

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

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

HUD-administered installation program means the installation program to be administered by HUD, in accordance with this part, in those states that do not have a qualifying installation program.

Installation means completion of work done specified in § 3286.505 to stabilize, support, anchor, and close up a manufactured home and to join sections of a multi-section manufactured home, when any such work is governed by the federal installation standards in part 3285 of this chapter or by state installation standards that are certified as part of a qualifying installation program.

Installation defect means any defect in the performance, installation, installation components, installation material, or close-up of a manufactured home that renders the home or any part thereof not fit for the ordinary use for which it was intended or otherwise takes the home out of compliance with the Manufactured Home Construction and Safety Standards in 24 CFR part 3280.

Installation design means drawings, specifications, sketches, and the related engineering calculations, tests, and data in support of the installation configurations and systems to be incorporated in the installation of manufactured homes.

Installation instructions means DAPIA-approved instructions provided by the home manufacturer that accompany each new manufactured home and detail the home manufacturer requirements for support and anchoring systems and other work completed at the installation site to comply with the Model Manufactured Home Installation Standards in 24 CFR part 3285 and the Manufactured Home Construction and Safety Standards in 24 CFR part 3280.

Installation standards means the standards established by HUD in 24 CFR part 3285, or any set of state standards that the Secretary has determined provide protection to the residents of manufactured homes that equals or exceeds the protection provided by the standards in 24 CFR part 3285.

Installer means 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, as governed by part 3285 of this chapter.

Installer's license or installation license means the evidence that an installer has met the requirements for installing manufactured homes under the HUD-administered installation program. The term does not incorporate a state-issued installation license or certification, except to the extent provided in this part. The term does not imply that HUD approves or recommends an installer or warrants the work of an installer, and should not be used in any way that indicates HUD approval in violation of 18 U.S.C. 709.

Lessee means the first person who leases a manufactured home from a retailer after the initial installation.

Manufactured home means a structure, transportable in one or more sections, which, in the traveling mode, is 8 body feet or more in width or 40 body feet or more in length, or, when erected on-site, is 320 or more square feet, and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities, and includes the plumbing, heating, air-conditioning, and electrical systems contained therein. The term also includes any structure that meets all the requirements of this paragraph except the size requirements and with respect to which the manufacturer voluntarily files a certification pursuant to § 3282.13 of this chapter and complies with the installation standards established under part 3285 and the construction and safety standards in part 3280 of this chapter, but such term does not include any self-propelled recreational vehicle. Calculations used to determine the number of square feet in a structure will include the total of square feet for each transportable section comprising the completed structure and will be based on the structure's exterior dimensions measured at the largest horizontal projections when erected on-site. These dimensions will include all expandable rooms, cabinets, and other projections containing interior space, but do not include bay windows. Nothing in this definition should be interpreted to mean that a manufactured home necessarily meets the requirements of HUD's Minimum Property Standards (HUD Handbook 4900.1) or that it is automatically eligible for financing under 12 U.S.C. 1709(b).

Manufactured Housing Consensus Committee, or MHCC, means the consensus committee established pursuant to section 604(a)(3) of the Act, 42 U.S.C. 5403(a)(3).

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

Manufacturer's certification label means the permanent label that is required by § 3280.11 of this chapter to be affixed to each transportable section of each manufactured home.

Person includes, unless the context indicates otherwise, corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals, but does not include any agency of government or tribal government entity.

Professional engineer or registered architect means an individual or entity: licensed to practice engineering or architecture in a state; and subject to all laws and limitations imposed by the state agency that regulates the applicable profession, and who is engaged in the professional practice of rendering service or creative work requiring education, training, and experience in architecture or engineering sciences and the application of special knowledge of the mathematical, physical, and engineering sciences in such professional or creative work as consultation, investigation, evaluation, planning or design, and supervision of construction for the purpose of securing compliance with specifications and design for any such work.

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

Qualified trainer means a person who has met the requirements established in subpart D of this part to be recognized as qualified to provide training to installers for purposes of the HUD-administered installation program.

Qualifying installation program means an installation program that a state certifies, in accordance with the requirements set out in subpart I of this part, as meeting the requirements of 42 U.S.C. 5404(c)(3).

Resident means any person residing in the manufactured home. Start Printed Page 35294

Retailer means any person engaged in the sale, leasing, or distribution of new manufactured homes primarily to persons who in good faith purchase or lease a manufactured home for purposes other than resale, and, for purposes of this part, the term includes any manufacturer or distributor that sells a manufactured home directly to a purchaser.

Secretary means the Secretary of Housing and Urban Development.

Set up means any assembly or installation of a manufactured home on-site that includes aspects of work that are governed by parts 3280 or 3285 of this chapter.

State includes each of the 50 states, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands, and American Samoa.

Overview of installation program.

(a) HUD-administered installation program. HUD will administer the installation program, as established and set out in subparts A through H of this part, in a state unless that state administers its own qualifying installation program. The states in which HUD administers an installation program can be identified under this part by referring to a list on a Web site maintained by HUD or by calling HUD. For convenience only, the current URL of the Web site is http://www.hud.gov/​offices/​hsg/​sfh/​mhs/​mhshome.cfm and the current toll-free telephone number to contact the HUD Office of Manufactured Housing Programs is 1-800-927-2891, extension 57.

(b) State-administered installation programs. States that have qualifying installation programs, as established through the procedures set out in subpart I of this part, will administer their own programs, except for generally applicable requirements in this subpart A.

(c) Manufacturer and retailer requirements. (1) Manufacturers and retailers are responsible for compliance of the home with the construction and safety standards in part 3280 of this chapter, in accordance with the Act and applicable regulations. Manufacturers and retailers must also comply with applicable requirements in this part relating to the installation of the manufactured home.

(2) In the installation instructions required pursuant to part 3285 of this chapter, the manufacturer must include instructions for supporting the manufactured home or sections of homes temporarily and protecting the interior of the manufactured home or sections of homes from damage, pending the first siting of the home for occupancy. The instructions must be adequate to assure that the temporary supports and weatherization used will be sufficient to prevent the home and its transportable sections from being brought out of conformance with the construction and safety standards in part 3280 of this chapter if the home or its sections is either:

(i) Stored at any location for more than 30 days; or

(ii) In the possession of any entity for more than 30 days.

(d) HUD oversight. The Secretary may take such actions as are authorized by the Act to oversee the system established by the regulations in this part, as the Secretary deems appropriate.

Consumer information.

(a) Manufacturer's consumer manual. In each consumer manual provided by a manufacturer as required in § 3282.207 of this chapter, the manufacturer must include a recommendation that any home that has been reinstalled after its original installation should be inspected after it is set up, in order to assure that it has not been damaged and is properly installed.

(b) Retailer disclosures before sale or lease. Prior to execution of the sales contract to purchase or agreement to lease a manufactured home, the retailer must provide the purchaser or lessee with a consumer disclosure. This disclosure must be in a document separate from the sales or lease agreement. The disclosure must include the following information, as applicable:

(1) When the installation of the home is in a state that administers its own qualifying installation program, the consumer disclosure must clearly state that the home will be required to comply with all state requirements for the installation of the home;

(2) When the installation of the home is in a state that does not administer its own qualifying installation program, the consumer disclosure must clearly state that the home will be required to comply with federal requirements, including installation in accordance with federal installation standards set forth in 24 CFR part 3285 and certification by a licensed installer of installation work, regardless of whether the work is performed by the homeowner or anyone else, and when certification includes inspection by an appropriate person;

(3) For all homes, the home may also be required to comply with additional state and local requirements for its installation;

(4) For all homes, additional information about the requirements disclosed under paragraphs (b)(1) through (b)(4) of this section is available from the retailer and, in the case of the federal requirements, is available in part 3286 of Title 24 of the Code of Federal Regulations and from the U.S. Department of Housing and Urban Development;

(5) For all homes, compliance with any additional federal, state, and local requirements, including a requirement for inspection of the installation of the home, may involve additional costs to the purchaser or lessee; and

(6) For all homes, a recommendation that any home that has been reinstalled after its original installation should be professionally inspected after it is set up, in order to assure that it has not been damaged in transit and is properly installed.

Manufacturer shipment responsibilities.

(a) Providing information to HUD. At or before the time that each manufactured home is shipped by a manufacturer, the manufacturer must provide HUD, through the Production Inspection Primary Inspection Agency (IPIA), in accordance with § 3282.552 of this chapter, with information, as applicable, about:

(1) The serial number and manufacturer's certification label number of the home;

(2) The manufacturer of the home; and

(3) The name and address of the retailer or distributor that has arranged for the home to be shipped.

(b) Manufacturer's installation instructions. The manufacturer is required to provide with each manufactured home, installation designs and instructions for the installation of the manufactured home that have been approved by a DAPIA. A DAPIA must give approval only if the installation designs and instructions provide equal or greater protection than the protection provided under the installation standards.

Temporary storage of units.

Pursuant to § 3286.5(c), the manufacturer is required to provide instructions for the temporary support and protection of the interior from damage of its manufactured homes or sections of homes. Every manufacturer, distributor, retailer, or installer that has possession of a home is required to support each transportable section of a manufactured home that is temporarily located on a site used by that manufacturer, distributor, retailer, or Start Printed Page 35295installer in accordance with the manufacturer's instructions.

Waiver of rights invalid.

Any provision of a contract or agreement entered into by a manufactured home purchaser that seeks to waive any recourse to either the HUD installation program or a state-qualifying installation program is void.

Consultation with the Manufactured Housing Consensus Committee (MHCC).

The Secretary will seek input from the MHCC when revising the installation program regulations in this part 3286. Before publication of a proposed rule to revise these regulations, the Secretary will provide the MHCC with a 120-day opportunity to comment on such revision. The MHCC may send to the Secretary any of the MHCC's own recommendations to adopt new installation program regulations or to modify or repeal any of the regulations in this part. Along with each recommendation, the MHCC must set forth pertinent data and arguments in support of the action sought. The Secretary will either: Accept or modify the recommendation and publish it for public comment in accordance with section 553 of the Administrative Procedure Act (5 U.S.C. 553), along with an explanation of the reasons for any such modification; or reject the recommendation entirely, and provide to the MHCC a written explanation of the reasons for the rejection. This section does not supersede section 605 of the National Manufactured Housing Construction and Safety Standards Act.

Subpart B—Certification of Installation in HUD-Administered States

Purpose.

The purpose of this subpart B is to establish the systems for tracking and certifying a manufactured home installation that is to be completed in accordance with the HUD-administered installation program.

Information provided by manufacturer.

(a) Shipment of home to retailer or distributor. At the time the manufactured home is shipped to a retailer or distributor, the manufacturer must provide notice to the retailer or distributor that tracking information for the home is being provided to HUD, and the information must be updated by the retailer or distributor in accordance with the requirements in § 3286.113. Such notice must include all of the information required in § 3286.9(a). The manufacturer is also encouraged to provide notice to the retailer that reminds the retailer of its other responsibilities under this part.

(b) Manufacturer's installation instructions. The manufacturer is required to include in its installation instructions for the home a notice that the home is required to be installed in accordance with:

(1) An installation design and instructions that have been provided by the manufacturer and approved by the Secretary directly or through review by the DAPIA; or

(2) An installation design and instructions that have been prepared and certified by a professional engineer or registered architect, that have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter.

DAPIA-approved installation instructions.

(a) Providing instructions to purchaser or lessee. (1) For each manufactured home sold or leased to a purchaser or lessee, the retailer must provide the purchaser or lessee with a copy of the manufacturer's DAPIA-approved installation instructions for the home.

(2) If the installation requires a design that is different from that provided by the manufacturer in paragraph (a)(1) of this section, the installation design and instructions must be prepared and certified by a professional engineer or registered architect, that have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter.

(b) Providing instructions to installer. When the retailer or manufacturer agrees to provide any set up in connection with the sale of the home, the retailer or manufacturer must provide a copy of the approved installation instructions required in paragraph (a)(1) of this section or, as applicable, installation design and instructions required in paragraph (a)(2) of this section to each company or, in the case of sole proprietor, to each individual who performs set up or installation work on the home.

Requirement for installer licensing.

(a) Installer Licensing. The installer that installs a manufactured home in a state that does not have a qualifying installation program must be certified or licensed in accordance with the requirements in subpart C of this part.

(b) Use of licensed installer. When the retailer or manufacturer agrees to provide any set up in connection with the sale or lease of the home, the retailer or manufacturer must ensure that the installer is licensed in accordance with these regulations.

Installation in accordance with standards.

(a) Compliance with installation requirements. (1) For purposes of determining installer compliance, a manufactured home that is subject to the requirements of this subpart B must be installed in accordance with:

(i) An installation design and instructions that have been provided by the manufacturer and approved by the Secretary directly or through review by the DAPIA; or

(ii) An installation design and instructions that have been prepared and certified by a professional engineer or registered architect, that have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter.

(2) If the installation instructions do not comply with the installation standards, the manufacturer is responsible for any aspect of installation that is completed in accordance with the installation instructions and that does not comply with the installation standards.

(3) All installation work must be in conformance with accepted practices to ensure durable, livable, and safe housing, and must demonstrate acceptable workmanship reflecting, at a minimum, journeyman quality of work of the various trades.

(4) Except as set out in paragraph (a)(2) of this section, all installation defects due to the work of the installer are the responsibility of the installer or retailer or manufacturer that retained the installer and must be corrected.

(5) If the manufacturer or retailer retains the installer, they are jointly and severally responsible with the installer for correcting installation defects.

(6) Installation defects must be corrected within 60 days after the date of discovery of the installation defect.

(b) Secretarial approval of manufacturer's designs. A manufacturer that seeks a Secretarial determination under paragraph (a) of this section that its installation designs and instructions provide protection to residents of manufactured homes that equals or exceeds the protection provided by the Start Printed Page 35296HUD federal installation standards in part 3285 of this chapter must send the request for such determination and a copy of the applicable designs and instructions to: Administrator, Office of Manufactured Housing Programs, HUD, 451 Seventh Street, SW., Room 9164, Washington, DC 20410-8000, or to a fax number or e-mail address obtained by calling the Office of Manufactured Housing Programs at the toll-free telephone number 1-800-927-2891, extension 57.

(c) Compliance with construction and safety standards. The installer must not take the home out of compliance with the construction and safety standards applicable under part 3280 of this chapter.

(d) Homeowner installations. The purchaser of a home sited in a state in which HUD administers the installation program may perform installation work on the home that is in accordance with paragraph (a) of this section, provided that the work is certified in accordance with § 3286.111.

(e) Compliance with construction and safety standards. This rule does not alter or affect the requirements of the Act concerning compliance with the construction and safety standards, and the implementing regulations in parts 3280 and 3282 of this chapter, which apply regardless of where the work is completed.

Inspection requirements—generally.

The installer or the retailer must arrange for the inspection of the installation work on any manufactured home that is sited in a state without a qualifying installation program. Before the home can be occupied, the installer must certify, and the inspector must verify, the home as having been installed in conformance with the requirements of § 3286.107(a). The requirements for installer certification are set out in subpart E of this part.

Installer certification of installation.

(a) Certification required. When the installation work is complete, a licensed installer must visit the jobsite and certify that:

(1) The manufactured home has been installed in accordance with:

(i) An installation design and instructions that have been provided by the manufacturer and approved by the Secretary directly or through review by the DAPIA; or

(ii) An installation design and instructions that have been prepared and certified by a professional engineer or registered architect, that have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter.

(2) The installation of the home has been inspected as required by § 3286.503 and an inspector has verified the installation as meeting the requirements of this part.

(3) All installation defects brought to the installer's attention have been corrected.

(b) Recipients of certification. The installer must provide a signed copy of its certification to the retailer that contracted with the purchaser or lessee for the sale or lease of the home, and to the purchaser or other person with whom the installer contracted for the installation work.

Information provided by retailer.

(a) Tracking information. Within 30 days from the time a purchaser or lessee enters into a contract to purchase or lease a manufactured home, the retailer or distributor of the home must provide HUD with the following information:

(1) The home's serial number and manufacturer's certification label number;

(2) The name and address of the retailer or distributor that is selling or leasing the home;

(3) The state and address where the home is to be sited, and, if known, the name of the local jurisdiction; and

(4) The name of the purchaser or lessee.

(b) Installation information. Within 30 days from the date of installation, the retailer or distributor of the home must provide HUD with the following information:

(1) The name, address, telephone number, and license number of the licensed installer;

(2) The date of installer certification of completion of the installation;

(3) The date a qualified inspector verified the installation as being in compliance with the requirements of this part; and

(4) The name, address, and telephone number of the qualified inspector who performed the inspection of the installation as required by § 3286.109.

(c) Method of providing information. (1) The retailer or distributor must provide a copy of the information set forth in paragraphs (a) and (b) of this section to HUD by providing a copy of the information to HUD by facsimile, e-mail, or first-class or overnight delivery.

(2) The information must be sent to: Administrator, Office of Manufactured Housing Programs, HUD, 451 Seventh Street, SW., Room 9164, Washington, DC 20410-8000, or to a fax number or e-mail address obtained by calling the Office of Manufactured Housing Programs. For convenience only, the URL of the Web site is http://www.hud.gov/​offices/​hsg/​sfh/​mhs/​mhshome.cfm and the toll-free telephone number to contact the Office of Manufactured Housing Programs is 1-800-927-2891, extension 57.

(d) Correcting information. If the information provided by the retailer changes after it has been provided to HUD, the retailer must correct the information within 10 business days after the retailer learns of the change.

(e) Record retention requirements. The retailer or distributor must maintain a copy of the records required in paragraphs (a) and (b) of this section for 3 years from the date of installation, as under § 3286.115.

Date of installation.

The date of installation will be the date the installer has certified that all required inspections have been completed, all utilities are connected, and the manufactured home is ready for occupancy as established, if applicable, by a certificate of occupancy, except as follows: If the manufactured home has not been sold to the first person purchasing the home in good faith for purposes other than resale by the date the home is ready for occupancy, the date of installation is the date of the purchase agreement or sales contract for the manufactured home.

Completion of sale date.

(a) Date of sale defined. For purposes of determining the responsibilities of a manufacturer, retailer, or distributor under subpart I of part 3282 of this chapter, the sale of a manufactured home will not be considered complete until all the goods and services that the manufacturer, retailer, or distributor agreed to provide at the time the contract was entered into have been provided.

(b) Compliance with construction and safety standards. When a retailer or manufacturer is providing the installation and an installer installs a home in such a way as to create an imminent safety hazard or cause the home to not comply with the construction and safety standards in part 3280 of this chapter, and those issues are discovered during the installation of the home, the sale or lease of the home is not complete until the home is corrected.

Start Printed Page 35297

Subpart C—Installer Licensing in HUD-Administered States

Purpose.

The purpose of this subpart C is to establish the requirements for a person to qualify to install a manufactured home in accordance with the HUD-administered installation program. Installers will be required to meet licensing, training, and insurance requirements established in this part. Licensed installers will self-certify their installations of manufactured homes to be in compliance with the Model Manufactured Home Installation Standards in part 3285 of this chapter. In order for such an installer to self-certify compliance with the installation standards, the installer will have to assure that acceptable inspections, as required in subpart F of this part, are performed.

Installation license required.

(a) Installation license required. (1) Any individual or entity that engages in the business of directing, supervising, or controlling initial installations of new manufactured homes in a state without a qualifying installation program must itself have, or must employ someone who has, a valid manufactured home installation license issued in accordance with the requirements of this subpart C. For each installation covered under these requirements, the licensed installer, and any company that employs the licensed installer, will be responsible for the proper and competent performance of all employees working under the licensed installer's supervision and for assuring that the installation work complies with this part.

(2) A business that employs a licensed installer to represent the business and hold the installer's license retains primary responsibility for performance of the installation work in compliance with the requirements of this part.

(3) A license is not required for individuals working as direct employees of a licensed installer or for the company that employs a licensed installer, provided that those individuals are supervised by a licensed installer.

(4) The installer must display an original or a copy of a valid installation license at the site of the installation while performing work related to the installation of the home.

(5) The installer is responsible for understanding and following, as applicable, the approved manufacturer installation instructions and any alternative installation design and instructions that have been certified by a professional engineer or registered architect, that have been approved by the manufacturer and DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter.

(b) Installation license not required. An installation license is not required for:

(1) Site preparation that is not subject to the requirements of part 3285 of this chapter;

(2) Connection of utilities to the manufactured home;

(3) Add-ons subject to the requirements of § 3282.8(j) of this chapter;

(4) Temporary installations on dealer, distributor, manufacturer, or other sales or storage lots, when the manufactured home is not serving as an occupied residence;

(5) Home maintenance, repairs, or corrections, or other noninstallation-related work performed by the home manufacturer under warranty or other obligations or service agreements;

(6) Installations performed by authorized representatives of the Federal Emergency Management Agency in order to provide emergency housing after a natural disaster; or

(7) Work performed at the home site that is not covered by the federal installation standards in part 3285 of this chapter or the requirements of this part.

Prerequisites for installation license.

(a) Required experience. (1) In order to obtain an installation license to perform manufactured home installations under the HUD-administered installation program, an individual must meet at least one of the following minimum experience requirements:

(i) 1,800 hours of experience installing manufactured homes;

(ii) 3,600 hours of experience in the construction of manufactured homes;

(iii) 3,600 hours of experience as a building construction supervisor;

(iv) 1,800 hours as an active manufactured home installation inspector;

(v) Completion of one year of a college program in a construction-related field; or

(vi) Any combination of experience or education from paragraphs (a)(1)(i) through (a)(1)(v) of this section that totals 3,600 hours.

(2) An installer who is certified or licensed to perform manufactured home installations in a state with a qualifying installation program may be exempted by the Secretary from complying with these experience requirements, if the Secretary determines that the state requirements are substantially equal to the HUD experience requirements.

(b) Required training—(1) Initial applicant. An applicant for an installation license must complete 12 hours of training, at least 4 hours of which must consist of training on the federal installation standards in part 3285 of this chapter and the installation program regulations in this part. An installer who is licensed to perform installations in a state with a qualified installation program may postpone the training requirements of this section until October 20, 2009.

(2) Renewal applicant. In order to qualify for renewal of an installation license, the licensed installer must complete 8 hours of continuing education during the 3-year license period, including in any particular subject area that may be required by HUD to be covered in order to assure adequate understanding of installation requirements.

(3) The training required under this paragraph (b) must be conducted by trainers who meet the requirements of subpart D of this part and must meet the curriculum requirements established in § 3286.308 or § 3286.309, as applicable.

(c) Testing. An applicant for an installation license must have successfully received a passing grade of 70 percent on a HUD-administered or HUD-approved examination covering the Manufactured Home Installation Program and the federal installation standards in part 3285.

(d) Surety bond or insurance. An applicant for an installation license must provide evidence of and must maintain, when available in the state of installation, a surety bond or insurance that will cover the cost of repairing all damage to the home and its supports caused by the installer during the installation up to and including replacement of the home. HUD may require the licensed installer to provide proof of the surety bond or insurance at any time. The licensed installer must notify HUD of any changes or cancellations with the surety bond or insurance coverage.

Process for obtaining installation license.

(a) Where to apply. An applicant for an initial or renewed installation license must provide the applicant's legal name, address, and telephone number to HUD. The application, with all required information, must be sent to: Administrator, Office of Manufactured Start Printed Page 35298Housing Programs, HUD, 451 Seventh Street, SW., Room 9164, Washington, DC 20410-8000, or to a fax number or e-mail address obtained by calling the Office of Manufactured Housing Programs. For convenience only, the current URL of the Web site is http://www.hud.gov/​offices/​hsg/​sfh/​mhs/​mhshome.cfm, and the current toll-free telephone number to contact the Office of Manufactured Housing Programs is 1-800-927-2891, extension 57.

(b) Proof of experience. Every applicant for an initial installation license must submit verification of the experience required in § 3286.205(a). This verification may be in the form of statements by past or present employers or a self-certification that the applicant meets those experience requirements, but HUD may contact the applicant for additional verification at any time. The applicant must also provide to HUD employment information relevant to the applicant's experience as an installer, including the dates and type of such employment. An installer who is certified or licensed to perform manufactured home installations in a state with a qualifying installation program may seek an exemption from the experience requirement by submitting proof of such certification or license.

(c) Proof of training. Every applicant for an initial installation license, or the renewal of an installation license, must submit verification of successful completion of the training required in § 3286.205(b). This verification must be in the form of a certificate of completion from a qualified trainer that the applicant has completed the requisite number of hours of a qualifying curriculum, as set out in § 3286.308 or § 3286.309.

(d) Proof of surety bond or insurance. Every applicant for an installation license must submit the name of the applicant's surety bond or insurance carrier and the number of the policy required in § 3286.205(d).

(e) Other application submissions. (1) Every applicant for an installation license must submit a list of all states in which the applicant holds a similar installation certification or license, and a list of all states in which the applicant has had such a certification or license revoked, suspended, or denied.

(2) When the examination is not administered by HUD, every applicant for an initial installation license must submit certification of a passing grade on the examination required by § 3286.205(c).

(f) Issuance or denial of an installation license. (1) When HUD confirms that an applicant has met the requirements in this subpart C, HUD will either:

(i) Provide an installation license to the applicant that, as long as the installation license remains in effect, establishes the applicant's qualification to install manufactured homes in a state subject to the HUD-administered installation program; or

(ii) Provide a written explanation of why HUD deems the applicant to not qualify for an installation license, including on grounds applicable under § 3286.209 for suspension or revocation of an installation license and any other specified evidence of inability to adequately meet the requirements of this part.

(2) An applicant who is denied an installation license under this subpart C, other than for failure to pass the installation license test, may request from HUD an opportunity for a presentation of views, in accordance with subpart D of part 3282 of this chapter, for the purpose of establishing the applicant's qualifications to obtain an installation license.

(g) Assignment of license prohibited. An installation license issued under this part may not be transferred, assigned, or pledged to another entity or individual.

Denial, suspension, or revocation of installation license.

(a) Oversight. The Secretary may make a continuing evaluation of the manner in which each licensed installer is carrying out his or her responsibilities under this subpart C.

(b) Denial, suspension, or revocation. After notice and an opportunity for a presentation of views in accordance with subpart D of part 3282 of this chapter, the Secretary may deny, suspend, or revoke an installation license under this part. An installation license may be denied, suspended, or revoked for, among other things:

(1) Providing false records or information to any party;

(2) Refusing to submit information that the Secretary requires to be submitted;

(3) Failure to comply with applicable requirements of parts 3285, 3286, or 3288 of this chapter;

(4) Failure to take appropriate actions upon a failed inspection, as provided in § 3286.509;

(5) Fraudulently obtaining or attempting to obtain an installation license, or fraudulently or deceptively using an installation license;

(6) Using or attempting to use an expired, suspended, or revoked installation license;

(7) Violating state or federal laws that relate to the fitness and qualification or ability of the applicant to install homes; or

(8) Engaging in poor conduct or workmanship as evidenced by one or more of the following:

(i) Installing one or more homes that fail to meet the requirements of § 3286.107;

(ii) An unsatisfied judgment in favor of a consumer;

(iii) Repeatedly engaging in fraud, deception, misrepresentation, or knowing omissions of material facts relating to installation contracts;

(iv) Having a similar state installation license or certification denied, suspended, or revoked;

(v) Having the renewal of a similar state installation license or certification denied for any cause other than failure to pay a renewal fee; or

(vi) Failure to maintain the surety bond or insurance required by § 3286.205(d).

(c) Other criteria. In deciding whether to suspend or revoke an installation license, the Secretary will consider the impact of the suspension or revocation on other affected parties and will seek to assure that the sales and siting of manufactured homes are not unduly disrupted.

(d) Reinstating an installation license. An installer whose installation license has been denied, suspended, or revoked may submit a new application in accordance with this subpart C. Installers whose installation licenses have been suspended may also reinstate their installation licenses in any manner provided under the terms of their suspensions.

Expiration and renewal of installation licenses.

(a) Expiration. Each installation license issued or renewed under this subpart C will expire 3 years after the date of its issuance or renewal.

(b) Renewal. An application for the renewal of an installation license must include the information required by, and must be submitted to, HUD in accordance with § 3286.207, and must be submitted at least 60 days before the date the license expires. Any person applying for a license renewal after the date the license expires must apply for a new installation license following the requirements established under this subpart C for application for an initial installation license.

Subpart D—Training of Installers in HUD-Administered States

Purpose.

The purpose of this subpart D is to establish the requirements for a person Start Printed Page 35299to qualify to provide the training required under subpart C of this part. This training is required for manufactured home installers who want to be licensed in accordance with the HUD-administered installation program.

Responsibilities of qualified trainers.

(a) Curriculum and hours. In providing training to installers for the purpose of qualifying installers under the HUD-administered installation program, qualified trainers must adequately address the curriculum and instruction-time requirements established in subparts C and D of this part.

(b) Attendance records. Qualified trainers must maintain records of the times, locations, names of attendees at each session, and content of all courses offered. When an attendee misses a significant portion of any training session, the trainer must assure that the attendee makes up the missed portion of the instruction.

(c) Certificates of completion of training. Qualified trainers must provide certificates of completion to course attendees that indicate the level of compliance with the applicable curriculum and time requirements under subparts C and D of this part.

(d) Record retention. All records maintained by trainers and continuing education providers must be retained for 3 years, and must be made available to HUD upon request.

(e) Testing of installers. Qualified trainers may be authorized to administer the installation license testing required for initial licensing of installers, as set forth in § 3286.205(c).

Installation trainer criteria.

(a) Trainer qualification required. (1) All classes that provide manufactured home installation education classes used to satisfy the requirements for the initial issuance and renewal of installation licenses under subpart C of this part must be taught by trainers who are registered with HUD as qualified trainers. In order to register with HUD as a qualified trainer, a person must meet the experience requirements of this section.

(2) Any entity other than a natural person may also provide initial training and continuing education, as long as such entity establishes its qualification as a trainer by providing evidence and assurance that the entity's individual trainers meet the requirements of this section.

(b) Experience prerequisites. In order to qualify as a trainer, an individual or other training entity must provide to HUD evidence that each individual who will be responsible for providing training:

(1) Has a minimum of 3,600 hours of experience in one or more of the following:

(i) As a supervisor of manufactured home installations;

(ii) As a supervisor in the building construction industry;

(iii) In design work related to the building construction industry; or

(2) Has completed a 2-year educational program in a construction-related field.

(c) Certification of curriculum. In order to register as a qualified trainer, an individual or other training entity must submit to HUD certification that training provided in accordance with this subpart D will meet the curriculum requirements established in § 3286.308 or § 3286.309, as applicable.

Process for obtaining trainer's qualification.

(a) Where to apply. An applicant for qualification as a trainer must provide the applicant's legal name, address, and telephone number to HUD. The application, with all required information, must be sent to: Administrator, Office of Manufactured Housing Programs, HUD, 451 Seventh Street, SW., Room 9164, Washington DC 20410-8000, or to a fax number or e-mail address obtained by calling the Office of Manufactured Housing Programs. For convenience only, the URL of the Web site is http://www.hud.gov/​offices/​hsg/​sfh/​mhs/​mhshome.cfm, and the toll-free telephone number to contact the Office of Manufactured Housing Programs is 1-800-927-2891, extension 57.

(b) Proof of experience. (1) Every individual applicant for initial qualification as a trainer must submit verification of the experience required in § 3286.305. This verification may be in the form of statements by past or present employers or a self-certification that the applicant meets those experience requirements, but HUD may contact the applicant for additional verification at any time. The applicant must also provide to HUD employment information relevant to the applicant's experience as a trainer, including the dates and type of such employment. A trainer who is licensed, or otherwise certified, to provide manufactured home installation training in a state with a qualifying installation program may seek an exemption from the experience requirement by submitting proof of such license or other certification. An individual who applies for renewal qualification as a trainer is not required to submit additional proof of experience.

(2) An entity that seeks to be designated as a qualified trainer must provide evidence and assurance that the entity's individual trainers meet the experience requirements in § 3286.305.

(c) Other qualification information. (1) An applicant for initial or renewal qualification as a trainer must submit to HUD a list of all states in which the applicant has had a similar training qualification revoked, suspended, or denied.

(2) An applicant also must submit to HUD a certification that training provided in accordance with this subpart D will meet the curriculum requirements established in § 3286.308 or § 3286.309, as applicable.

(d) Confirmation or denial of qualification. (1) When HUD confirms that an applicant has met the experience and curriculum requirements in this section, HUD will either:

(i) Provide to the applicant a written confirmation that the applicant is a qualified trainer under this part, and will add the applicant's name to a list maintained by HUD of qualified trainers; or

(ii) Provide a written explanation of why HUD deems the applicant to not qualify as a trainer, including on grounds applicable under § 3286.311 for suspension or revocation of a qualification and any other specified evidence of inability to meet the requirements of this part.

(2) An applicant whose qualification is denied by HUD may request an opportunity for a presentation of views, in accordance with subpart D of part 3282 of this chapter, for the purpose of establishing the applicant's qualifications to be a qualified trainer or the adequacy of any training curriculum that is challenged by HUD.

(e) Assignment of qualification prohibited. A qualification issued under this subpart D may not be transferred, assigned, or pledged to another entity or individual.

Training curriculum.

(a) Curriculum for initial installer licensing. The training provided by qualified trainers to installers to meet the initial requirements of the HUD-administered installation program must include at least 12 hours of training, at least 4 hours of which must consist of training on the federal installation standards in part 3285 of this chapter and the installation program regulations in this part. The curriculum must include, at a minimum, training in the following areas: Start Printed Page 35300

(1) An overview of the Act and the general regulatory structure of the HUD manufactured housing program;

(2) An overview of the manufactured home installation standards and regulations established in parts 3285 and 3286 of this chapter, and specific instruction including:

(i) Preinstallation considerations;

(ii) Site preparation;

(iii) Foundations;

(iv) Anchorage against wind;

(v) Optional features, including comfort cooling systems;

(vi) Ductwork and plumbing and fuel supply systems;

(vii) Electrical systems; and

(viii) Exterior and interior close-up work;

(3) An overview of the construction and safety standards and regulations found in parts 3280 and 3282 of this chapter;

(4) Licensing requirements applicable to installers;

(5) Installer responsibilities for correction of improper installation, including installer obligations under applicable state and HUD manufactured housing dispute resolution programs;

(6) Inspection requirements and procedures;

(7) Problem-reporting mechanisms;

(8) Operational checks and adjustments; and

(9) Penalties for any person's failure to comply with the requirements of this part 3286 and parts 3285 and 3288 of this chapter.

(b) Updating curriculum. Qualified trainers must revise and modify course curriculum as needed to include, at a minimum, any relevant modifications to the Act or the implementing standards and regulations in this chapter, as well as to provide any training further mandated by HUD.

Continuing education-trainers and curriculum.

(a) HUD-mandated elements. Only qualified trainers are permitted to provide any training on particular subject areas that are required by HUD to be an element of the continuing education requirement set out in § 3286.205(b)(2) for the renewal of an installer's license. In implementing this requirement, HUD will:

(1) Establish the minimum number of hours and the required curriculum for such subject areas, according to experience with the program and changes in program requirements; and

(2) Provide information about the hours and curriculum directly to qualified trainers and licensed installers, or through general publication of the information.

(b) Other training. (1) The remainder of the 8 hours required to meet the continuing education requirement may be met through training provided either by qualified trainers or by any combination of the following:

(i) Accredited educational institutions, including community colleges and universities;

(ii) A provider of continuing education units who is certified by the International Association for Continuing Education and Training;

(iii) Agencies at any level of government; and

(iv) State or national professional associations.

(2) The curriculum for the remainder of the 8 hours of continuing education training must relate to any aspect of manufactured home installation or construction, or to the general fields of building construction or contracting.

Suspension or revocation of trainer's qualification.

(a) Oversight. The Secretary may make a continuing evaluation of the manner in which each qualified trainer is carrying out the trainer's responsibilities under this subpart D.

(b) Suspension or revocation of qualification. After notice and an opportunity for a presentation of views in accordance with subpart D of part 3282 of this chapter, the Secretary may suspend or revoke a trainer's qualification under this part. A trainer's qualification may be suspended or revoked for cause, which may include:

(1) Providing false records or information to HUD;

(2) Refusing to submit information required to be submitted by the Secretary in accordance with the Act;

(3) Certifying, or improperly assisting certification of, a person as having met the training requirements established in this part when that person has not completed the required training;

(4) Failing to appropriately supervise installation training that is used to meet the requirements of this part and that is provided by other persons; and

(5) Any other failures to comply with the requirements of this part.

(c) Other criteria. In deciding whether to suspend or revoke a trainer's qualification, the Secretary will consider the impact of the suspension or revocation on other affected parties and will seek to assure that the sales and siting of manufactured homes are not unduly disrupted.

(d) Reinstating qualification. A trainer whose qualification has been suspended or revoked may submit a new application to be qualified in accordance with this subpart D no sooner than 6 months after the date of suspension or revocation. A trainer whose qualification has been suspended may also reinstate the qualification in any manner provided under the terms of the suspension.

Expiration and renewal of trainer qualification.

(a) Expiration. Each notice of qualification issued or renewed under this subpart D will expire 5 years after the date of its issuance or renewal.

(b) Renewal. An application for the renewal of a trainer qualification must be submitted to HUD in accordance with § 3286.307, and must be submitted at least 60 days before the date the trainer's term of qualification expires. Any person applying for a qualification renewal after the date the qualification expires must apply for a new qualification, following the requirements established under this subpart D for application for initial qualification as an installation trainer.

Subpart E—Installer Responsibilities of Installation in HUD-Administered States

Purpose.

The purpose of this subpart E is to set out the responsibilities of the installer who is accountable for the installation of a manufactured home in compliance with the requirements of the HUD-administered installation program.

Licensing requirements.

An installer of manufactured homes must comply with the licensing requirements set forth in subpart C of this part.

Installation suitability.

(a) Site appropriateness. Before installing a manufactured home at any site, the installer must assure that the site is suitable for installing the home by verifying that:

(1) The site is accessible;

(2) The site is appropriate for the foundation or support and stabilization system that is to be used to install the home in accordance with the federal installation standards or alternative requirements in part 3285 of this chapter;

(3) The data plate required by § 3280.5 of this chapter is affixed to the home, that the home is designed for the roof load, wind load, and thermal zones that are applicable to the intended site; and

(4) The installation site is protected from surface run-off and can be graded in accordance with part 3285.

(b) Installer notification of unsuitable site. If the installer determines that the Start Printed Page 35301home cannot be installed properly at the site, the installer must:

(1) Notify the purchaser or other person with whom the installer contracted for the installation work, identifying the reasons why the site is unsuitable;

(2) Notify the retailer that contracted with the purchaser for the sale of the home, identifying the reasons why the site is unsuitable;

(3) Notify HUD, identifying the reasons why the site is unsuitable;

(4) Decline to install the home until the site and the home are both verified by the installer as suitable for the site under this section; and

(5) Ensure that all unique characteristics of the site have been fully addressed.

(c) Installer notification of failures to comply with the construction and safety standards. If the installer notices and recognizes failures to comply with the construction and safety standards in part 3280 of this chapter prior to beginning any installation work, during the course of the installation work, or after the installation work is complete, the installer must notify the manufacturer and retailer of each failure to comply.

(d) Retailer notification. The retailer must provide a copy of the notification received in paragraphs (b) and (c) of this section to any subsequent installer.

Supervising work of crew.

The installer will be responsible for the work performed by each person engaged to perform installation tasks on a manufactured home, in accordance with the HUD-administered installation program.

Obtaining inspection.

(a) Inspection obligations. Ten business days prior to the completion of installation, the installer must arrange for a third-party inspection of the work performed, in accordance with subpart F of this part, unless the installer and retailer who contracted with the purchaser for the sale of the home agree, in writing, that during the same time period the retailer will arrange for the inspection. Such inspection must be performed as soon as practicable by an inspector who meets the qualifications set forth in § 3286.511. The scope of the inspections that are required to be performed is addressed in § 3286.505.

(b) Contract rights not affected. Failure to arrange for an inspection of a home within 5 business days will not affect the validity or enforceability of any sale or contract for the sale of any manufactured home.

(c) State or local permits. The licensed installer should obtain all necessary permits required under state or local laws.

Certifying installation.

(a) Certification required. When the installation work is complete, a licensed installer must visit the jobsite and certify that:

(1) The manufactured home has been installed in accordance with:

(i) An installation design and instructions that have been provided by the manufacturer and approved by the Secretary directly or through review by the DAPIA; or

(ii) An installation design and instructions that have been prepared and certified by a professional engineer or registered architect, that have been approved by the manufacturer and the DAPIA as providing a level of protection for residents of the home that equals or exceeds the protection provided by the federal installation standards in part 3285 of this chapter.

(2) The installation of the home has been inspected as required by § 3286.503, and an inspector has verified the installation as meeting the requirements of this part.

(3) All installation defects brought to the installer's attention have been corrected.

(b) Recipients of certification. The installer must provide a signed copy of its certification to the retailer that contracted with the purchaser or lessee for the sale or lease of the home, and to the purchaser or other person with whom the installer contracted for the installation work.

Recordkeeping.

(a) Records to be retained. The installer must retain:

(1) A record of the name and address of the purchaser or other person with whom the installer contracted for the installation work and the address of the home installed;

(2) A copy of the contract pursuant to which the installer performed the installation work;

(3) A copy of any notice from an inspector disapproving the installation work;

(4) A copy of the qualified inspector's verification of the installation work;

(5) A copy of the installer's certification of completion of installation in accordance with the requirements of this part; and

(6) A copy of foundation designs used to install the home, if different from the designs provided by the manufacturer, including evidence that the foundation designs and instructions were certified by a professional engineer or registered architect, including the name, address, and telephone number of the professional engineer or architect certifying the designs.

(b) Retention requirement. The records listed in paragraph (a) of this section must be maintained for a period of 3 years after the installer certifies completion of installation.

Subpart F—Inspection of Installations in HUD-Administered States

Purpose.

The purpose of this subpart F is to provide additional detail about the inspection that must be performed by a qualified third-party inspector before the installation of a manufactured home may be verified by the inspector and certified by the installer under the HUD-administered installation program.

Inspection required.

(a) Timing of requirements. Ten business days prior to the completion of the installation of each manufactured home, the installer must arrange for a third-party inspection of the work performed, unless the installer and retailer who contracted with the purchaser for the sale of the home agree, in writing, that during the same time period the retailer will arrange for the inspection. Such inspection must be performed as soon as practicable by an inspector that meets the qualifications set out in § 3286.511. The scope of the inspections that are required to be performed is addressed in § 3286.505.

(b) Disclosure of requirement. At the time of sale, the retailer must disclose to the purchaser, in a manner provided in § 3286.7, that the manufactured home must be installed in accordance with applicable federal and state law, including requirements for a third-party inspection of the installation. If the cost of inspection of the home's installation is not included in the sales price of the home, the sales contract must include a clear disclosure about whether the purchaser will be charged separately for the inspection of the home's installation and the amount of such charge.

(c) Providing instructions to inspectors. Installation instructions must be made available to the inspector at the installation site by the installer.

Minimum elements to be inspected.

The installation of every manufactured home that is subject to the HUD-administered installation program is required to be inspected for each of the installation elements included in a checklist. The checklist must include assurance that each of the following elements complies with the Start Printed Page 35302requirements of part 3285 of this chapter:

(a) Site location with respect to home design and construction;

(b) Consideration of site-specific conditions;

(c) Site preparation and grading for drainage;

(d) Foundation construction;

(e) Anchorage;

(f) Installation of optional features;

(g) Completion of ductwork, plumbing, and fuel supply systems;

(h) Electrical systems;

(i) Exterior and interior close-up;

(j) Skirting, if installed; and

(k) Completion of operational checks and adjustments.

Verifying installation.

(a) Verification by inspector. When an inspector is satisfied that the manufactured home has been installed in accordance with the requirements of this part, the inspector must provide verification of the installation in writing and return the evidence of such verification to the installer.

(b) Certification by installer. (1) Once an installation has been inspected and verified, the installer is permitted to certify the installation as provided in § 3286.111. The installer must provide a signed copy of the certification to:

(i) The retailer that contracted with the purchaser for the sale of the home;

(ii) The purchaser; and

(iii) Any other person that contracted to obtain the services of the installer for the installation work on the home.

(2) The installer must retain records in accordance with § 3286.413.

Reinspection upon failure to pass.

(a) Procedures for failed inspection. If the inspector cannot verify the installation of the manufactured home, the inspector must immediately notify the installer of any failures to comply with the installation standards and explain the reasons why the inspector cannot issue verification that the installation complies with the requirements of this part. After the installation is corrected, it must be reinspected before verification can be issued.

(b) Cost of reinspection. If there is any cost for the reinspection of an installation that an inspector has refused to verify, that cost must be paid by the installer or the retailer and, absent a written agreement with the purchaser that specifically states otherwise, that cost cannot be charged to the purchaser of the manufactured home.

Inspector qualifications.

(a) Qualifications. Any individual or entity who meets at least one of the following qualifications is permitted to review the work and verify the installation of a manufactured home that is subject to the requirements of the HUD-administered installation program:

(1) A manufactured home or residential building inspector employed by the local authority having jurisdiction over the site of the home, provided that the jurisdiction has a residential code enforcement program;

(2) A professional engineer;

(3) A registered architect;

(4) A HUD-accepted Production Inspection Primary Inspection Agency (IPIA) or a Design Approval Primary Inspection Agency (DAPIA); or

(5) An International Code Council certified inspector.

(b) Independence required. The inspector must be independent of the manufacturer, the retailer, the installer, and any other person that has a monetary interest, other than collection of an inspection fee, in the completion of the sale of the home to the purchaser.

(c) Suspension or revocation of inspection authority. After notice and an opportunity for a presentation of views in accordance with subpart D of part 3282 of this chapter, the Secretary may suspend or revoke an inspector's authority to inspect manufactured home installations under this part in HUD-administered states. An inspector's authority may be suspended or revoked for cause. In deciding whether to suspend or revoke an inspector's authority to conduct such installation inspections, the Secretary will consider the impact of the suspension or revocation on other affected parties and will seek to assure that the sales and siting of manufactured homes are not unduly disrupted.

(d) Reinstating inspection authority. An inspector whose authority to inspect manufactured home installations in HUD-administered states has been suspended or revoked under this section may apply for reauthorization by contacting: Administrator, Office of Manufactured Housing Programs, HUD, 451 Seventh Street, SW., Room 9164, Washington, DC 20410-8000, or to a fax number or e-mail address obtained by calling the Office of Manufactured Housing Programs at the toll-free telephone number 1-800-927-2891, extension 57.

Subpart G—Retailer Responsibilities in HUD-Administered States

Purpose.

The purpose of this subpart G is to set out the requirements that apply to a retailer with respect to the federal installation requirements applicable to new manufactured homes that the retailer sells or leases and that will be installed in states that do not have qualifying installation programs. These requirements are in addition to other requirements that apply to retailers of manufactured homes pursuant to other parts of this chapter.

At or before sale.

(a) Before contract. (1) The retailer is required to support each transportable section of a manufactured home that is temporarily or permanently located on a site used by a retailer in accordance with the manufacturer's instructions.

(2) Before a purchaser or lessee signs a contract of sale or lease for a manufactured home, the retailer must:

(i) Provide the purchaser or lessee with a copy of the consumer disclosure statement required in § 3286.7(b); and

(ii) Verify that the wind, thermal, and roof load zones of the home being purchased or leased are appropriate for the site where the purchaser or lessee plans to install the home for occupancy; and

(iii) If the cost of inspection of the home's installation is not included in the sales price of the home, provide the disclosure required in § 3286.7(b).

(b) Occupancy site not known. When at the time of purchase the purchaser does not know the locale for the initial siting of the home for occupancy, the retailer must advise the purchaser that:

(1) The home was designed and constructed for specific wind, thermal, and roof load zones; and

(2) If the home is sited in a different zone, the home may not pass the required installation inspection because the home will have been installed in a manner that would take it out of compliance with the construction and safety standards in part 3280 of this chapter.

(c) Verification of installer license. When the retailer or manufacturer agrees to provide any set up in connection with the sale or lease of the home, the retailer or manufacturer must verify that the installer is licensed in accordance with these regulations.

After sale.

(a) Tracking installation information. The retailer is responsible for providing to HUD the information required pursuant to § 3286.113. Start Printed Page 35303

(b) Other tracking and compliance requirements. The retailer continues to be responsible for compliance with the tracking and compliance requirements set out in subpart F of part 3282 of this chapter, which are related to HUD construction and safety standards.

Recordkeeping.

The retailer is responsible for the reporting and recordkeeping requirements under § 3286.113.

Subpart H—Oversight and Enforcement in HUD-Administered States

Purpose.

The purpose of this subpart H is to set out the mechanisms by which manufacturers, retailers, distributors, installers, and installation inspectors will be held accountable for assuring the appropriate installation of manufactured homes. The requirements in subpart A of this part are applicable in all states, the requirements in subparts B through H are applicable in states where the HUD-administered installation program operates, and the requirements in subpart I are applicable in states with qualifying installation programs. It is the policy of the Secretary, regarding manufactured home installation program enforcement matters, to cooperate with state or local agencies having authority to regulate the installation of manufactured homes. In addition to actions expressly recognized under this subpart H and other provisions in this part, however, HUD may take any actions authorized by the Act in order to oversee the system established by the regulations in this part.

Failure to comply.

(a) Penalties and injunctive relief. Failure to comply with the requirements of this part is a prohibited act under section 610(a)(7) of the Act, 42 U.S.C. 5409(a). Any person who fails to comply with the requirements of this part is subject to civil and criminal penalties, and to actions for injunctive relief, in accordance with sections 611 and 612 of the Act, 42 U.S.C. 5410 and 5411.

(b) Presentation of views. When practicable, the Secretary will provide notice to any person against whom an action for injunctive relief is contemplated and will afford such person an opportunity to request a presentation of views. The procedures set forth in §§ 3282.152 through 3282.154 of this chapter shall apply to each request to present views and to each presentation of views authorized in accordance with this section.

(c) Investigations. The procedures for investigations and investigational proceedings are set forth in part 3800 of this chapter.

Applicability of dispute resolution program.

(a) Generally. Regardless of any action taken under § 3286.703, for any defect in a manufactured home that is reported during the one-year period beginning on the date of installation, as specified in § 3286.115, any rights and remedies available under the HUD dispute resolution program, as implemented in part 3288 of this chapter, continue to apply as provided in that part.

(b) Waiver of rights invalid. Any provision of a contract or agreement entered into by a manufactured home purchaser that seeks to waive any recourse to either HUD or a state dispute resolution program is void.

Subpart I—State Programs

Purpose.

The purpose of this subpart I is to establish the requirements that must be met by a state to implement and administer its own installation program, either as part of its approved state plan or under this subpart, in such a way that the state would not be covered by the HUD-administered installation program. This subpart I also establishes the procedure for determining whether a state installation program meets the requirements of the Act for a qualifying installation program that will operate in lieu of the HUD-administered installation program.

State qualifying installation programs.

(a) Qualifying installation program supersedes. The HUD-administered installation program will not be implemented in any state that is identified as fully or conditionally accepted under the requirements and procedures of this subpart I or in accordance with part 3282 of this chapter.

(b) Minimum elements. To be accepted as a fully qualifying installation program, a state installation program must include the following elements:

(1) Installation standards that meet or exceed the requirements of § 3286.107(a) and that apply to every initial installation of a new manufactured home within the state;

(2) The training of manufactured home installers;

(3) The licensing of, or other method of certifying or approving, manufactured home installers to perform the initial installations of new manufactured homes in the state;

(4) A method for inspecting the initial installations of new manufactured homes in the state that is implemented and used to hold installers responsible for the work they perform; and

(5) Provision of adequate funding and personnel to administer the state installation program.

(c) Conditional acceptance. (1) A state installation program that meets the minimum requirements set forth under paragraphs (b)(1), (4), and (5) of this section may be conditionally accepted by the Secretary if the state provides assurances deemed adequate by the Secretary that the state is moving to meet all of the requirements for full acceptance. If the Secretary conditionally accepts a state's installation program, the Secretary will provide to the state an explanation of what is necessary to obtain full acceptance.

(2) A conditionally accepted state will be permitted to implement its own installation program in lieu of the HUD-administered program for a period of not more than 3 years. The Secretary may for good cause grant an extension of conditional approval upon petition by the state.

(d) Limited exemptions from requirements. A state installation program may be accepted by the Secretary as a qualifying installation program if the state can demonstrate that it lacks legal authority, as a matter of federal law, to impose the minimum requirements set forth under paragraph (b) of this section in certain geographic areas of the state, but that the minimum requirements do apply in all other geographic areas of the state.

Procedures for identification as qualified installation program.

(a) Submission of certification. (1) A state seeking identification as having a qualified installation program must submit a completed State Installation Program Certification form to the Secretary for review and acceptance and indicate if the installation program will be part of its approved state plan in accordance with part 3282 of this chapter.

(2) A state must include a qualified installation program as part of any state plan application submitted for approval under § 3282.302 of this chapter, if the state does not have a fully or conditionally approved state plan in effect at the time of submission of the state plan application. In all other cases, a qualified installation program is permitted, but is not required, to be submitted as a part of a state plan Start Printed Page 35304approved in accordance with § 3282.305 of this chapter.

(b) HUD review and action. (1) The Secretary will review the State Installation Program Certification form submitted by a state and may request that the state submit additional information as necessary. Unless the Secretary has contacted the state for additional information or has conditionally accepted or rejected the state installation program, the state installation program will be considered to have been accepted by the Secretary as a fully qualifying installation program as of the earlier of:

(i) Ninety days after the Secretary receives the state's completed State Installation Program Certification form; or

(ii) The date that the Secretary issues notification to the state of its full acceptance.

(2) A notice of full or conditional acceptance will include the effective date of acceptance.

(c) Rejection of state installation program. (1) If the Secretary intends to reject a state's installation program, the Secretary will provide to the state an explanation of what is necessary to obtain full or conditional acceptance. The state will be given 90 days from the date the Secretary provides such explanation to submit a revised State Installation Program Certification form.

(2) If the Secretary decides that any revised State Installation Program Certification form is inadequate, or if the state fails to submit a revised form within the 90-day period or otherwise indicates that it does not intend to change its form, the Secretary will notify the state that its installation program is not accepted.

(3) A state whose State Installation Program Certification form is rejected has a right to a presentation of views on the rejection using the procedures set forth under subpart D of part 3282 of this chapter. The state's request for a presentation of views must be submitted to the Secretary within 60 days after the Secretary has provided notification that the state's installation program has been rejected.

Recertification required.

(a) Recertification. To maintain its status as a qualified installation program when the installation program is not part of the approved state plan in accordance with part 3282 of this chapter, a state must submit a new State Installation Program Certification form to the Secretary for review and action as follows:

(1) Every 5 years after the state's most recent certification as a qualified installation program; and

(2) Whenever there is a change to the state's installation program or a change in the HUD requirements applicable to qualifying installation programs such that the state's installation program no longer complies with the minimum requirements set forth in § 3286.803(b), regardless of when the state's next regular recertification of its installation program would be due.

(b) Due date of recertification. (1) A state's recertification required in paragraph (a) of this section must be filed within 90 days of, as applicable:

(i) The 5-year anniversary of the effective date of the Secretary's acceptance of the state's most recent certification as a qualified installation program; and

(ii) The effective date of the state or HUD action that makes a significant change to the state's installation program.

(2) Upon petition by the state, the Secretary may for good cause grant an extension of the deadline for recertification.

(c) Failure to Recertify. (1) A state whose certification of its installation program, when the installation program is not part of the approved state plan in accordance with part 3282 of this chapter, has been accepted by the Secretary is permitted to administer its installation program in lieu of the HUD-administered installation program until the effective date of a notification by the Secretary that the state's certification of its installation program is no longer approved.

(2) A state whose recertification of its installation program is rejected by the Secretary has a right to a presentation of views on the rejection using the procedures set forth under subpart D of part 3282 of this chapter. The state's request for a presentation of views must be submitted to the Secretary within 60 days after the Secretary has provided notification that the state's recertification of its installation program has been rejected.

Withdrawal of qualifying installation program status.

(a) Voluntary withdrawal. Any state that intends to withdraw from its responsibilities to administer a qualifying installation program should provide the Secretary with a minimum of 90 days notice.

(b) Involuntary withdrawal. Whenever the Secretary finds, after affording notice and an opportunity for a hearing in accordance with subpart D of part 3282 of this chapter, that a state installation program fails to comply substantially with any provision of the installation program requirements or that the state program has become inadequate, the Secretary will notify the state of withdrawal of acceptance or conditional acceptance of the state installation program. The HUD-administered installation program will begin to operate in such state at such time as the Secretary establishes in issuing the finding.

Effect on other manufactured housing program requirements.

A state with a qualifying installation program will operate in lieu of HUD with respect to only the installation program established under subparts B through H of this part. No state may permit its installation program, even if it is a qualified installation program under this part, to supersede the requirements applicable to HUD's Manufactured Housing Construction and Safety Standards and enforcement programs. Regardless of whether a state has a qualified installation program:

(a) Construction and safety standards. Any responsibilities, rights, and remedies applicable under the Manufactured Home Construction and Safety Standards Act in part 3280 of this chapter and the Manufactured Home Procedural and Enforcement Regulations in part 3282 of this chapter continue to apply as provided in those parts; and

(b) Dispute resolution. For any defect in a manufactured home that is reported during the one-year period beginning on the date of installation defined in § 3286.115, any responsibilities, rights, and remedies applicable under the HUD dispute resolution program as implemented in part 3288 of this chapter continue to apply as provided in that part.

Inclusion in state plan.

If a state installation program is included in a state plan approved in accordance with § 3282.302 of this chapter, the state installation program is subject to all of the requirements for such a state plan, including annual review by HUD.

End Part Start Signature

Dated: June 5, 2008.

Brian D. Montgomery,

Assistant Secretary for Housing—Federal Housing Commissioner.

End Signature End Supplemental Information

[FR Doc. E8-13289 Filed 6-19-08; 8:45 am]

BILLING CODE 4210-67-P