H.B. No. 785
1-1 AN ACT
1-2 relating to the regulation of manufactured housing; providing
1-3 penalties.
1-4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-5 SECTION 1. Sections 3(4), (8), (9), (14), and (21), Texas
1-6 Manufactured Housing Standards Act (Article 5221f, Vernon's Texas
1-7 Civil Statutes), are amended to read as follows:
1-8 (4) "Department" means the Texas Department of Housing
1-9 and Community Affairs <Licensing and Regulation>.
1-10 (8) "Seal" means a device or insignia issued by the
1-11 director <commissioner> to be affixed to used manufactured homes
1-12 for titling purposes, as required by the director <commissioner>.
1-13 The seal shall remain the property of the department.
1-14 (9) "Label" means a device or insignia issued by the
1-15 director <commissioner> to indicate compliance with the standards,
1-16 rules, and regulations established by the Department of Housing and
1-17 Urban Development, and is permanently affixed to each transportable
1-18 section of each HUD-code manufactured home constructed after June
1-19 15, 1976, for sale to a consumer.
1-20 (14) "Director" <"Commissioner"> means the executive
1-21 director of the department <commissioner of licensing and
1-22 regulation>.
1-23 (21) "Board" <"Commission"> means the governing board
1-24 of the department <Texas Commission of Licensing and Regulation>.
2-1 SECTION 2. Section 4, Texas Manufactured Housing Standards
2-2 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
2-3 read as follows:
2-4 Sec. 4. MANUFACTURED HOUSING STANDARDS. (a) The director
2-5 <commissioner> shall adopt standards and requirements for the
2-6 installation and for the construction of manufactured housing, that
2-7 are reasonably necessary in order to protect the health, safety,
2-8 and welfare of the occupants and the public. The collection of
2-9 these standards and requirements is the Texas Manufactured Housing
2-10 Code.
2-11 (b) The requirements and standards for the plumbing,
2-12 heating, air-conditioning and electrical systems and construction
2-13 of manufactured <mobile> homes in effect on September 1, 1989,
2-14 remain in full force and effect until amended in accordance with
2-15 the procedure set forth in this section.
2-16 (c) The director <commissioner> shall adopt standards and
2-17 requirements for the construction of HUD-code manufactured homes in
2-18 compliance with the federal standards and requirements established
2-19 under Title VI of the Housing and Community Development Act of
2-20 1974, entitled the National Manufactured Home Construction and
2-21 Safety Standards Act of 1974.
2-22 (d) <(b)> The director <commissioner> shall adopt standards
2-23 and requirements for the installation of all manufactured housing
2-24 in the state that are necessary for the protection of the health,
2-25 safety, and welfare of all the citizens. The standards must assure
2-26 that the installation of manufactured housing on both permanent and
2-27 nonpermanent foundation systems resists overturning and lateral
3-1 movement of the housing according to the design loads for the
3-2 particular wind zone for which the housing was constructed <in the
3-3 first two tiers of coastal counties in the state is capable of
3-4 withstanding winds of hurricane-force velocity of not less than 105
3-5 miles per hour and that manufactured housing in all other counties
3-6 of the state is capable of withstanding winds of a minimum
3-7 gale-force velocity>.
3-8 (e) The requirements and standards for the installation of
3-9 manufactured <mobile> homes as adopted by the state <department> in
3-10 existence on September 1, 1989, remain in force until amended in
3-11 accordance with the procedure set forth in this section.
3-12 (f) All manufactured housing must be installed in compliance
3-13 with the standards, rules, regulations, or administrative orders of
3-14 the director <commissioner>.
3-15 (g) <(c)> A local governmental unit <political subdivision>
3-16 of this state, without the express approval of the board
3-17 <commission> following a hearing on the matter, may not adopt
3-18 different standards from those promulgated by the director
3-19 <commission> for the construction or installation of manufactured
3-20 housing within the local governmental unit <political subdivision>.
3-21 (h) <(d)> Before the adoption or promulgation of any
3-22 standards or requirements authorized by this section, any change in
3-23 or addition to the standards authorized in this section, or the
3-24 approval of different standards by any local governmental unit
3-25 <political subdivision>, the director <commissioner> shall publish
3-26 a notice and conduct a public hearing in accordance with Chapter
3-27 2001, Government Code <the Administrative Procedure and Texas
4-1 Register Act, as amended (Article 6252-13a, Vernon's Texas Civil
4-2 Statutes)>, not sooner than the 30th day following the publication
4-3 of notice.
4-4 (i) <(e)> Every requirement or standard or modification,
4-5 amendment, or repeal of a requirement or standard adopted by the
4-6 director <commissioner> shall state the date it shall take effect.
4-7 (j) <(f)> The department shall cooperate with all units of
4-8 local government in this state and shall authorize local units of
4-9 government, on request, to make and perform inspection and
4-10 enforcement activities related to the construction of foundation
4-11 systems and the erection and installation of manufactured housing
4-12 at the homesite pursuant to contracts or other official
4-13 designations and the rules and regulations of the director
4-14 <commissioner>. The department shall notify each local
4-15 governmental unit biennially in writing to advise the local
4-16 governmental unit of the program for contracting installation
4-17 inspections. The department shall encourage local building
4-18 inspection officials to perform enforcement and inspection
4-19 activities for manufactured housing installed within the local
4-20 governmental unit and may establish cooperative inspection training
4-21 programs. The department may withdraw the authorization if the
4-22 local governmental unit fails to follow the rules, regulations,
4-23 interpretations, and written instructions of the department.
4-24 SECTION 3. Section 6(g), Texas Manufactured Housing
4-25 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), is
4-26 amended to read as follows:
4-27 (g) It is unlawful for a retailer to purchase for resale to
5-1 a consumer, or to sell, exchange, or lease-purchase or offer to
5-2 sell, exchange, or lease-purchase, any new HUD-code manufactured
5-3 home which was constructed by a manufacturer which was not
5-4 registered with the department <commissioner> at the time of
5-5 construction.
5-6 SECTION 4. Section 7, Texas Manufactured Housing Standards
5-7 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended by
5-8 amending Subsections (a), (d), (e), (g), (i), and (k)-(q) and
5-9 adding Subsection (r) to read as follows:
5-10 (a) A person may not construct or assemble a new HUD-code
5-11 manufactured home in the state or ship a new HUD-code manufactured
5-12 home into the state, unless the person is registered as a
5-13 manufactured housing manufacturer with <by> the department
5-14 <commissioner> and possesses a valid manufacturer's certificate of
5-15 registration at the time the home is constructed or assembled.
5-16 (d) A person may not perform any installation functions on
5-17 manufactured housing in the state, unless the person possesses a
5-18 valid installer's certificate of registration and files proof of
5-19 insurance as required by the director <commissioner>. The director
5-20 <commissioner> may issue a temporary installer's certificate of
5-21 registration to a homeowner for the installation of the owner's
5-22 home in accordance with applicable requirements, standards, and
5-23 regulations of the director <commissioner>, on application and
5-24 payment of the required fee and on submission of proof of insurance
5-25 by the owner as required by the department.
5-26 (e) Each applicant for a certificate of registration as a
5-27 manufacturer, retailer, broker, or installer must file with the
6-1 director <commissioner> an application for registration containing
6-2 the following information:
6-3 (1) the legal name, address, and telephone number of
6-4 the applicant;
6-5 (2) the trade name by which the applicant does
6-6 business and, if incorporated, the name registered with the
6-7 secretary of state and the address of the business; and
6-8 (3) the dates on which the applicant became the owner
6-9 and operator of the business.
6-10 (g) All certificates of registration are valid for one year
6-11 <the period set by the commission> and are renewable as provided by
6-12 the director <commission>.
6-13 (i) If a change occurs in the information filed with the
6-14 director <commissioner> under Subsection (e) of this section, the
6-15 applicant shall file an amendment to his or her application that
6-16 states the correct information.
6-17 (k) The director <commissioner>, after notice and hearing,
6-18 may refuse to issue or may permanently revoke, or suspend for a
6-19 definite period of time and for a specified geographic area or
6-20 sales location, any certificate of registration if the director
6-21 <commissioner> finds that the applicant or registrant:
6-22 (1) knowingly and wilfully violated any provision of
6-23 this article or any rule, administrative order, or regulation made
6-24 pursuant to this Act <article>;
6-25 (2) without lawful authorization retained or converted
6-26 any money, property, or any other thing of value from consumers in
6-27 the form of down payments, sales and use taxes, deposits, or
7-1 insurance premiums;
7-2 (3) failed to deliver proper title documents or
7-3 certificates of title to consumers;
7-4 (4) failed to give or breached any manufactured home
7-5 warranty required by this Act <article> or by the Federal Trade
7-6 Commission;
7-7 (5) engaged in any false, misleading, or deceptive
7-8 acts or practices as the term is set forth in and as those acts are
7-9 declared unlawful by the provisions of Chapter 17, Subchapter E,
7-10 Business & Commerce Code;
7-11 (6) failed to furnish or file any reports required by
7-12 the department for the administration and enforcement of this Act
7-13 <article>;
7-14 (7) furnished false information on any application,
7-15 report, or other document filed with the department;
7-16 (8) has a record of criminal convictions within the
7-17 five years preceding the date of the application that <which>, in
7-18 the opinion of the director <commissioner>, renders the applicant
7-19 unfit for registration; or
7-20 (9) failed to file the bond or post other security for
7-21 each location as required by <Section 13 of> this Act <article>.
7-22 (l) The director <commissioner> shall conduct any hearing
7-23 involving the denial, revocation or suspension of a certificate of
7-24 registration in accordance with Chapter 2001, Government Code <the
7-25 Administrative Procedure and Texas Register Act, as amended
7-26 (Article 6252-13a, Vernon's Texas Civil Statutes)>.
7-27 (m) A retailer or an installer may not contract with any
8-1 person for the installation of any air-conditioning equipment,
8-2 devices, or components in connection with the installation of a
8-3 manufactured home unless the person is registered as an installer
8-4 with the department <commissioner> or is otherwise licensed by the
8-5 state as an air-conditioning contractor. This subsection shall not
8-6 apply to a new manufactured home being installed on a permanent
8-7 foundation within a municipality which regulates air-conditioning
8-8 contractors unless some other state statute provides otherwise.
8-9 (n) A person may not act as a salesperson of manufactured
8-10 housing unless the person is registered with the department
8-11 <commissioner>. Each applicant for a certificate of registration
8-12 shall file with the director <commissioner> an application giving
8-13 such information as the director <commissioner> deems necessary and
8-14 pay the required fee. The owner of a sole proprietorship, a partner
8-15 in a partnership, or an officer of a corporation which is duly
8-16 registered as a retailer or broker does not have to register as a
8-17 salesperson so long as such individual is properly listed in the
8-18 retailer's or broker's application for registration. The
8-19 salesperson is the agent of the retailer or broker. The
8-20 registration shall be an annual registration. A retailer or broker
8-21 shall not employ, retain, or otherwise use the services of a
8-22 salesperson who is not registered. A registered salesperson may
8-23 work or sell for one or more retailers, brokers, or sales
8-24 locations.
8-25 (o) A person may not alter, repair, or otherwise rebuild a
8-26 salvaged manufactured home, as such term is defined in Section 8 of
8-27 this Act <article>, unless the person is duly registered with the
9-1 department <commissioner> as a manufactured home rebuilder or
9-2 retailer and unless the person complies with the rules and
9-3 regulations of the director <commissioner> relating to the
9-4 rebuilding of salvaged manufactured homes.
9-5 (p) Any person not registered with the department or a
9-6 predecessor agency <commissioner> as of September 1, 1987, must
9-7 attend and complete twenty (20) hours of instruction in the law and
9-8 consumer protection regulations prior to any registration. The
9-9 instruction shall be given not less than one time each quarter. No
9-10 test shall be made a prerequisite of registration, but actual
9-11 attendance at the instruction sessions is required. The director
9-12 <commissioner> shall not issue a registration until the instruction
9-13 is completed. This subsection does not apply to a registrant
9-14 making application to register additional business locations or to
9-15 register as a salesperson. In lieu of this instruction requirement,
9-16 a manufacturer may request that a one-day, in-plant training
9-17 session be presented by an authorized representative of the
9-18 department. The manufacturer shall reimburse the department for
9-19 the actual costs of the training session.
9-20 (q) Notwithstanding any provision of this Act <article> to
9-21 the contrary, any state or national bank, state or federal savings
9-22 and loan association or federal savings bank, or state or federal
9-23 credit union engaged in the business of selling or offering for
9-24 sale, exchange, or lease-purchase manufactured homes that the
9-25 institution has acquired as a result of repossession of its
9-26 collateral is not required to attend any school or file any bond or
9-27 post other security in order to be registered as a retailer.
10-1 (r) In lieu of the instruction requirements imposed under
10-2 Subsection (p) of this section, the director may recognize and
10-3 approve a one-day training program for installers that is conducted
10-4 in the field by a private institution or other person.
10-5 SECTION 5. Section 7A, Texas Manufactured Housing Standards
10-6 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
10-7 read as follows:
10-8 Sec. 7A. CONTINUING EDUCATION PROGRAMS. The director
10-9 <commissioner> may recognize, prepare, or administer continuing
10-10 education programs for persons regulated under this Act.
10-11 Participation in the programs is voluntary.
10-12 SECTION 6. Section 8, Texas Manufactured Housing Standards
10-13 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended by
10-14 amending Subsections (c), (e), (f), (g), and (h) and by adding
10-15 Subsection (i) to read as follows:
10-16 (c) For purposes of all provisions of this Act <article> or
10-17 other laws of this state the term "habitable" as applied to
10-18 manufactured housing is limited to and means that there is no
10-19 defect, damage, or deterioration to the home which creates a
10-20 dangerous or unsafe situation or condition; that the plumbing,
10-21 heating, and electrical systems are in safe working order; that the
10-22 walls, floor, and roof are free from any substantial openings not
10-23 designed and are structurally sound; and that all exterior doors
10-24 and windows are in place.
10-25 (e) The purchaser of a used manufactured home for business
10-26 use shall not sell, exchange, or lease-purchase the home for use as
10-27 a dwelling or residence unless a new title to the used manufactured
11-1 home is issued by the director <commissioner>. The purchaser may
11-2 apply to the department for the issuance of a new title. The
11-3 department shall then inspect the home, and if it is determined
11-4 that the home is habitable, issue a new title.
11-5 (f) A holder of a lien recorded on a manufactured home
11-6 document of title issued by the department who sells, exchanges, or
11-7 transfers by a lease-purchase a repossessed manufactured home
11-8 covered by such document of title is not required to comply with
11-9 the provisions of this Act <article>, provided that the sale,
11-10 exchange, or transfer by a lease-purchase is (1) to or through a
11-11 registered retailer, or (2) to a purchaser for the purchaser's
11-12 business use. If the sale, exchange, or lease-purchase is to a
11-13 purchaser for the purchaser's business use, the holder of the lien
11-14 shall surrender the title to the department for cancellation. If
11-15 the sale, exchange, or lease-purchase is to or through a registered
11-16 retailer, the retailer is responsible and liable for compliance
11-17 with the provisions of this Act <article> and all rules and
11-18 regulations of the department, and the holder of the lien shall not
11-19 be joined as a party in any litigation arising in connection with,
11-20 or relating to, the sale, exchange, or lease-purchase of the
11-21 repossessed manufactured home.
11-22 (g) For the purposes of this Act, a <(1) A> "salvaged"
11-23 manufactured home<, for purposes of all provisions of this article,
11-24 is defined as and> means a manufactured home obtained by a property
11-25 and casualty insurer from the insured by reason of the insurer's
11-26 payment of the policy value written on the home to the insured.
11-27 The<; the> reasonableness of the insurer's judgment that the costs
12-1 of repair to the home would exceed the insured value of the home
12-2 does not affect the status of the home as salvage. <(2)> The
12-3 person possessing the original document of title to a salvaged
12-4 manufactured home must surrender such document of title to the
12-5 director <commissioner> for cancellation of the title and issuance
12-6 of a salvage title. If the manufactured home is rebuilt in
12-7 accordance with the provisions of this Act <article> and the rules
12-8 and regulations of the director <commissioner>, the director
12-9 <commissioner> shall issue, upon proper application, a new original
12-10 document of title in lieu of the salvage title.
12-11 (h) Notwithstanding any provisions of this section to the
12-12 contrary, the director <commissioner>, following a written
12-13 application by the purchaser or transferee, may expressly authorize
12-14 in writing a registered retailer to sell or exchange a used
12-15 manufactured home which is not or may not be habitable to or with
12-16 governmental housing agencies or authorities or to nonprofit
12-17 organizations providing housing for the homeless. As a part of the
12-18 application the purchaser or transferee must certify to the receipt
12-19 of a written notice that the home is not or may not be habitable.
12-20 The form of such written notice shall be prepared by the consumer
12-21 protection division of the attorney general's office and approved
12-22 by the director <commissioner>. The purchaser or transferee shall
12-23 not occupy the home or allow the home to be occupied as a residence
12-24 or dwelling until such time as any necessary repairs to make the
12-25 home habitable have been completed.
12-26 (i) A tax collector is not required to comply with this
12-27 section or other sections of this Act relating to the sale of a
13-1 used manufactured home in relation to the sale of a manufactured
13-2 home for the collection of delinquent taxes. If a manufactured
13-3 home does not have a serial number, seal, or label, the tax
13-4 collector may apply to the department for a seal, pay the
13-5 applicable fee, and recover that fee as part of the cost of the
13-6 sale of the manufactured home. The seal issued to the tax
13-7 collector is for identification purposes only and may not be
13-8 construed to imply that:
13-9 (1) the home is habitable; or
13-10 (2) the purchaser of the home at a tax sale may obtain
13-11 a title document from the department without an inspection for
13-12 habitability.
13-13 SECTION 7. Section 9, Texas Manufactured Housing Standards
13-14 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
13-15 read as follows:
13-16 Sec. 9. ADMINISTRATION AND ENFORCEMENT. (a) The director
13-17 <commission> is hereby charged with the administration and
13-18 enforcement of this Act <article>.
13-19 (b) The director <commissioner> shall adopt rules and
13-20 regulations, promulgate administrative orders, and take all action
13-21 necessary to assure compliance with the intent and purpose of this
13-22 Act to effectuate and to provide for uniform enforcement of all
13-23 provisions of this Act and of the Texas Manufactured Housing
13-24 Standards Code. The director <commissioner> shall make and enforce
13-25 rules and regulations reasonably required to effectuate the
13-26 notification and correction procedures provided in Section 615 of
13-27 the National Manufactured Home Construction and Safety Standards
14-1 Act of 1974.
14-2 (c) The director <commissioner> shall adopt rules and
14-3 regulations, promulgate administrative orders, and take all actions
14-4 necessary to comply with the provisions of the National
14-5 Manufactured Home Construction and Safety Standards Act of 1974
14-6 and to provide for the effective enforcement of all HUD-code
14-7 manufactured home construction and safety standards in order to
14-8 have its state plan approved by the secretary of the United States
14-9 Department of Housing and Urban Development. The state plan must
14-10 provide for the use of <that a manufacturer may, at its option,
14-11 choose a> third-party inspection agencies <agency that is> approved
14-12 by the <commission and authorized by the> Department of Housing and
14-13 Urban Development to act as an <the> In Plant Inspection Agency.
14-14 <However, the manufacturer may not change from one third-party In
14-15 Plant Inspection Agency to another without the approval of the
14-16 commission.>
14-17 (d) At least 30 days before the adoption or promulgation of
14-18 any change in or addition to the rules and regulations authorized
14-19 in Subsections (b) and (c) of this section, the director
14-20 <commissioner> shall publish in the Texas Register a notice
14-21 including:
14-22 (1) a copy of the proposed changes and additions; and
14-23 (2) the time and place that the director
14-24 <commissioner> will consider any objections to the proposed changes
14-25 and additions.
14-26 (e) After giving the notice required by Subsection (d) of
14-27 this section, the director <commissioner> shall afford interested
15-1 persons an opportunity to participate in the rule-making through
15-2 submission of written data, views, or arguments with the <or
15-3 without> opportunity to present the same orally on any matter.
15-4 (f) Every rule or regulation or modification, amendment, or
15-5 repeal of a rule or regulation adopted by the director
15-6 <commissioner> shall state the date it shall take effect.
15-7 (g) Immediately after their promulgation, the director
15-8 <commissioner> shall publish in the Texas Register all rules and
15-9 regulations or amendments thereto.
15-10 (h) <(j)> The director <commissioner> may employ state
15-11 inspectors to carry out the functions required of the department
15-12 pursuant to this Act <article>, to effectuate the provisions of
15-13 this Act <article>, and to enforce the rules, regulations, and
15-14 administrative orders promulgated pursuant to this Act <article>.
15-15 The director <commissioner> may authorize state inspectors to
15-16 travel inside or outside of the state to inspect manufacturing
15-17 facilities in connection with the enforcement of this Act
15-18 <article>.
15-19 (i) <(k)> The director <commissioner> may contract with any
15-20 federal agency or any agency or political subdivision of any state
15-21 for the performance of any inspections or inspection programs
15-22 pursuant to this Act <article> or the rules and regulations of the
15-23 director <commissioner> to assure that manufactured homes sold or
15-24 installed in the state comply with the Texas Manufactured Housing
15-25 Standards Code.
15-26 (j) <(l)> The director <commissioner> may enter into
15-27 contracts with the Department of Housing and Urban Development or
16-1 its designees to monitor the Department of Housing and Urban
16-2 Development programs.
16-3 (k) <(m)> When necessary or required by law, the director
16-4 <commissioner> may obtain inspection search warrants.
16-5 (l) <(n)> The director <commissioner> may inspect
16-6 manufactured homes at the borders of this state and adopt rules and
16-7 regulations necessary for the inspection of all manufactured homes
16-8 entering this state to assure compliance with the National
16-9 Manufactured Home Construction and Safety Standards Act of 1974,
16-10 the Texas Manufactured Housing Standards Code, and the rules and
16-11 regulations of the director <commissioner>, and to assure payment
16-12 of any use tax which may be due the State of Texas.
16-13 (m) <(o)> In order to protect the public health, safety, and
16-14 welfare, and to assure the availability of low cost manufactured
16-15 housing for all consumers, the director <commissioner> shall
16-16 establish rules and regulations for the protection of the interests
16-17 of consumers who occupy or desire to purchase or install
16-18 manufactured housing and for the business conduct of those persons
16-19 required to be registered under this Act <article>.
16-20 SECTION 8. Sections 11(a), (b), (c), (e), and (g), Texas
16-21 Manufactured Housing Standards Act (Article 5221f, Vernon's Texas
16-22 Civil Statutes), are amended to read as follows:
16-23 (a) There shall be a fee in an amount set by the board
16-24 <commission> for the inspection of the installation of mobile and
16-25 HUD-code manufactured homes which shall be paid by the installer of
16-26 the home. Said fee shall be paid to the state and shall accompany
16-27 notification to the department of the exact location of the home.
17-1 The department shall make appropriate fee distributions to local
17-2 governmental units performing inspections pursuant to contracts or
17-3 other official designations provided that the local governmental
17-4 units are not collecting a local inspection fee.
17-5 (b) Looking for guidance to the rules and regulations
17-6 promulgated under Title VI of the Housing and Community Development
17-7 Act of 1974 and to that Act itself, the board <commission> shall
17-8 set fees for the following functions:
17-9 (1) There shall be a schedule of fees for the review
17-10 of HUD-code manufactured home blueprints and supporting data when
17-11 the department acts as a Design Approval Primary Inspection Agency.
17-12 This fee shall be paid by the manufacturer seeking approval.
17-13 (2) There shall be an inspection fee on all HUD-code
17-14 manufactured homes manufactured or assembled within the State of
17-15 Texas. This fee shall be paid by the manufacturer of the home.
17-16 The manufacturer shall also be charged for the actual cost of
17-17 travel for representatives of the department to and from the
17-18 manufacturing facility.
17-19 (3) The fees in Subsections (1) and (2) shall not be
17-20 applicable when an accepted inspection agency authorized by the
17-21 Department of Housing and Urban Development, other than the
17-22 department, acts as the Design Approval Primary Inspection Agency
17-23 or the In-Plant Inspection Agency.
17-24 (4) There shall be a fee charged on an hourly basis
17-25 for inspection of alterations made upon the structure, plumbing,
17-26 heating, or electrical systems of HUD-code manufactured homes.
17-27 This fee shall be paid by the person making the alteration. There
18-1 shall be a fee for the inspection of the rebuilding of salvaged
18-2 manufactured homes which shall be paid by the rebuilder. The
18-3 person making the alteration or the rebuilder shall also be charged
18-4 for the actual cost of travel for representatives of the department
18-5 to and from the place of inspection. There shall be a fee for the
18-6 inspection of used manufactured homes for which the title has been
18-7 cancelled to determine if the home is habitable for the issuance of
18-8 a new title.
18-9 (5) There shall be a fee for the issuance of seals for
18-10 used mobile or HUD-code manufactured homes.
18-11 (c) The board <commission> shall set fees for the issuance
18-12 and renewal of manufacturers', retailers', brokers', salespersons',
18-13 and installers' certificates of registration; and fees for the
18-14 issuance of rebuilder registrations.
18-15 (e) A fee shall be set and charged to the manufacturer or
18-16 retailer requesting a consumer complaint inspection of the
18-17 manufactured home pursuant to the provisions of <Subsection (e) of>
18-18 Section 14 of this Act <article>.
18-19 (g) The board <commission> shall set the fees imposed under
18-20 this section in amounts that are reasonable and necessary to defray
18-21 the costs of administering this Act <article>.
18-22 SECTION 9. Sections 13 and 13A, Texas Manufactured Housing
18-23 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), are
18-24 amended to read as follows:
18-25 Sec. 13. SECURITY <REQUIRED>. (a) The department
18-26 <commissioner> may not issue or renew a certificate of
18-27 registration<,> unless <the applicant first files> a surety bond or
19-1 <posts> other security in the <such> form prescribed by <as> the
19-2 director is filed with the department as provided by <commissioner
19-3 may prescribe and a written irrevocable designation of the
19-4 commissioner as agent for service of legal process, which service
19-5 is made pursuant to Subsection (k) of> this section.
19-6 (b) If a surety bond is filed, the <it shall be continuous
19-7 and remain in effect until cancelled by the surety company with
19-8 notice as provided in this section. Other security need not be
19-9 posted annually so long as the applicable amount specified in this
19-10 section remains posted. If a claim is made against the security
19-11 causing the security to be lessened, the person posting the
19-12 security has 20 calendar days in which to post additional security
19-13 so that compliance may be had with the requirements of this
19-14 section. If the deficit is not eliminated within 20 days, the
19-15 certificate of registration of the inadequately covered
19-16 manufacturer, retailer, broker, or installer is immediately
19-17 suspended. If a bond is cancelled, the certificate of registration
19-18 is suspended on the effective date of cancellation.>
19-19 <(c) If other security is posted, the interest from the
19-20 security shall go to the person posting the security.>
19-21 <(d) The> bond must <shall> be <a surety bond> issued by a
19-22 company authorized to do business in this state and must conform to
19-23 applicable provisions of <shall be in conformity with> the
19-24 Insurance Code. If <The> other security is posted, the other
19-25 security must be maintained in or by a banking institution located
19-26 in this state <shall be in such a form as the commissioner may deem
19-27 appropriate>.
20-1 (c) <(e)> The bond or other security shall be payable to and
20-2 for the benefit of the special account established under Section
20-3 13A of this Act. <state for the use by a consumer, the state, or
20-4 any political subdivision thereof who secures any judgment against
20-5 a manufacturer, retailer, broker, or installer, or a registrant's
20-6 surety, for damages, restitution, or expenses including reasonable
20-7 attorney's fees resulting from a cause of action directly related
20-8 to the sale, lease-purchase, exchange, brokerage, or installation
20-9 of a manufactured home, including:>
20-10 <(1) retention or conversion of money, property, or
20-11 any other thing of value from consumers in the form of down
20-12 payments, any sales and use taxes, deposits, or insurance premiums;>
20-13 <(2) failure to give proper title documents or
20-14 certificates of title to consumers;>
20-15 <(3) failure to give or the breach of any warranty
20-16 required by this article or by the Federal Trade Commission or the
20-17 violation of any requirements of the Texas Credit Code or of the
20-18 federal Truth-in-Lending Act; or>
20-19 <(4) engaging in any false, misleading, or deceptive
20-20 acts or practices as the term is set forth in and as those acts or
20-21 practices are declared unlawful by the provisions of Chapter 17,
20-22 Subchapter E, Business & Commerce Code.>
20-23 <(f) The bond or other security shall not be liable for any
20-24 judgment, or part thereof, resulting from pain and suffering,
20-25 mental anguish, emotional distress, or any other tort claims except
20-26 as are recoverable in a deceptive trade practice action pursuant to
20-27 Chapter 17, Subchapter E, Business & Commerce Code, nor for any
21-1 punitive, exemplary, or treble damages. A consumer, the state, or
21-2 any political subdivision thereof may recover against the
21-3 principal, the surety, or the principal and surety jointly and
21-4 severally for such damages, restitution, or expenses, provided,
21-5 however, that in no event shall a surety or the other security
21-6 posted under this section be liable for an amount in excess of
21-7 actual damages, restitution, or expenses, including reasonable
21-8 attorney's fees. Any judgment obtained against a principal is
21-9 conclusive against the surety or other security if notice of the
21-10 filing of suit is given as required by this section.>
21-11 (d) The bond or other security shall be open to successive
21-12 claims up to the amount of the face value of the bond or other
21-13 required security. The surety shall not be liable for successive
21-14 claims in excess of the bond amount, regardless of the number of
21-15 years the bond remains in force.
21-16 <(g) A consumer shall inform the manufacturer, retailer, or
21-17 installer, and the department in writing of any claim against the
21-18 bond or security no later than two years after the purchase of the
21-19 manufactured home. Whenever the department receives notice of a
21-20 claim against a bond, the commissioner shall promptly notify the
21-21 bonding company involved. If the consumer claim results in a
21-22 private lawsuit being filed by the consumer, the consumer shall
21-23 notify the attorney general's office and the surety company by
21-24 certified mail of the filing of the lawsuit. At the time of sale
21-25 or delivery of a new manufactured home to a consumer, the consumer
21-26 must be given conspicuous written notification of this two-year
21-27 limit and the notice requirements.>
22-1 (e) <(h)> Any manufacturer, retailer, broker, or installer
22-2 who maintains a place of business at one or more locations shall
22-3 file with the department <commissioner> a separate bond or other
22-4 security for each location. Property used for the business that is
22-5 not contiguous to, or located within 300 feet of, a bonded location
22-6 requires a separate bond. Any location at which a manufactured
22-7 home is shown to the public or at which it is offered for sale,
22-8 exchange, or lease-purchase by a retailer to consumers is a
22-9 location which is required to be bonded. A manufactured home
22-10 installed on a permanent foundation system and offered for sale as
22-11 real estate is not a business location that requires a bond. A
22-12 temporary location for a bona fide trade show sponsored by a
22-13 nonprofit corporation which qualifies for tax exemption pursuant to
22-14 Section 501(c) of the U.S. Internal Revenue Code is not a location
22-15 which requires a bond.
22-16 (f) <(i)> A manufacturer shall be bonded or post other
22-17 security in the amount of $100,000. A retailer shall be bonded or
22-18 post other security in the amount of $30,000. A broker shall be
22-19 bonded or post other security in the amount of $20,000. An
22-20 installer shall be bonded or post other security in the amount of
22-21 $10,000. A rebuilder shall be bonded or post other security in the
22-22 amount of $30,000. In order to assure the availability of prompt
22-23 and satisfactory warranty service, a manufacturer, which does not
22-24 have a registered manufacturing plant or other facility in this
22-25 state from which warranty service and repairs can be provided and
22-26 made, shall be bonded or post other security in an additional
22-27 amount of $100,000. A retailer holding a valid certificate of
23-1 registration shall not be required to be bonded or file any
23-2 security to secure a certificate of registration as a broker or an
23-3 installer. A new bond shall not be required for any change of
23-4 ownership of a corporation registered with the department
23-5 <commissioner> nor for any change of a location; however, a proper
23-6 endorsement of the original bond may be required by the director
23-7 <commissioner>.
23-8 (g) <(j)> The bonding company must provide written
23-9 notification to the director <commissioner> at least 60 days prior
23-10 to the cancellation of a surety <any> bond required by this
23-11 section. Any other security on file with the department
23-12 <commissioner> shall remain on file and be maintained <with the
23-13 commissioner> for two years after the person ceases business as a
23-14 manufacturer, retailer, broker, or installer or at such later time
23-15 as the director <commissioner> may determine that no claims exist
23-16 against the security.
23-17 (h) If a bond is canceled, the certificate of registration
23-18 is suspended on the effective date of cancellation. If a surety
23-19 files for liquidation or reorganization in bankruptcy or is placed
23-20 in receivership, the registrant is entitled to 60 days from the
23-21 date notice of the filing or receivership was received to obtain
23-22 other security. If the required face amount of any other security
23-23 is impaired by the payment of a claim, the registrant is entitled
23-24 to 60 days to restore the security to its required face value.
23-25 (i) Subject to the limitations in this section, the bond or
23-26 other security is liable for, and shall reimburse the recovery fund
23-27 under Section 13A of this Act, the amount of any claim paid out of
24-1 the fund by the director to a consumer that resulted from an act or
24-2 omission of the registrant who filed the bond or other security.
24-3 Payment by the surety or from the other security shall be made not
24-4 later than the 30th day from the date of receipt of notice from the
24-5 director that a consumer claim has been paid. If for any reason
24-6 the surety or other security fails to make timely payment of a
24-7 claim to the fund, the attorney general shall file suit for
24-8 recovery of the amount due the fund. Venue for the suit is in
24-9 Travis County.
24-10 (j) As trustee of the fund, the director shall prepare an
24-11 informational pamphlet informing the consumers of their rights to
24-12 recover from the recovery fund. The director may contract with
24-13 private parties for the printing and distribution of the pamphlets.
24-14 <(k)(1) The commissioner may not be served as a registrant's
24-15 agent for service of legal process unless the service is
24-16 accompanied by the affidavit of a person legally authorized to
24-17 serve civil process that service on the registrant has been
24-18 attempted but has not been possible. The affidavit shall set forth
24-19 the facts relating to the attempted, but unsuccessful, service.>
24-20 <(2) When served with process as the agent of a
24-21 registrant, the commissioner shall mail a copy of the affidavit,
24-22 citation, and petition by certified mail, return receipt requested,
24-23 to the physical location and the mailing addresses of the
24-24 registrant and, if applicable, to the registrant's corporate
24-25 mailing address.>
24-26 Sec. 13A. <MANUFACTURED HOMEOWNERS'> RECOVERY FUND. (a)
24-27 There is hereby established a special account in the general
25-1 revenue fund designated as the manufactured homeowners' recovery
25-2 fund ("fund"). The fund shall be administered <and managed> by the
25-3 director <commission>.
25-4 (b) No bond or other security shall be required of the
25-5 director in the director's capacity as administrator of the fund
25-6 <members of the board of trustees>.
25-7 (c) The <Beginning September 1, 1987, the> department shall
25-8 charge and collect an additional fee of $10 for each <and every>
25-9 title transaction for which it charges a fee. This additional fee
25-10 shall be deposited in the <special> fund.
25-11 (d) The <sums in this> fund, the fees collected for the
25-12 fund, and income earned from investment of the fund shall be used
25-13 exclusively for the protection programs set forth in <carrying out
25-14 the purposes of> this section. Money in the fund <These funds> may
25-15 be invested and reinvested in the same manner as funds of the
25-16 <Texas State> Employees Retirement System of Texas. Income from
25-17 the fund<; and the interest from these investments> shall be
25-18 deposited to the credit of the fund. No <It is expressly provided,
25-19 however, that no> investments may <shall> be made that <which will>
25-20 impair the <necessary> liquidity necessary for payment of the
25-21 protection programs <required to reimburse consumers> as provided
25-22 by <in> this section.
25-23 (e) Subject to the limitations <and requirements> of Section
25-24 13 of this Act <article> and of this section, the fund shall be
25-25 used to compensate consumers who sustain actual damages resulting
25-26 from <have> unsatisfied <judgments, or in certain limited
25-27 circumstances unsatisfied> claims<,> against a manufacturer,
26-1 retailer, broker, or installer registered with the department if
26-2 the claims resulted from a violation of:
26-3 (1) this Act;
26-4 (2) a rule issued by the director;
26-5 (3) the National Manufactured Housing Construction and
26-6 Safety Standards Act;
26-7 (4) the rules and regulations of the United States
26-8 Department of Housing and Urban Development; or
26-9 (5) the Deceptive Trade Practices-Consumer Protection
26-10 Act, Section 17.41 et seq., Business & Commerce Code.
26-11 (f) The consumer must file a verified written complaint in
26-12 the form required by the director not later than the second
26-13 anniversary of the date of the alleged act or omission causing the
26-14 actual damages, or the second anniversary of the date the act or
26-15 omission is discovered or should reasonably have been discovered.
26-16 Failure to timely file the claim precludes recovery from the fund.
26-17 On receipt of a properly verified complaint, the department shall
26-18 notify the registrants as appropriate and investigate the claim to
26-19 determine its validity and whether or not the complaint can be
26-20 resolved by remedial action of the registrants. If there is a
26-21 dispute between the registrants as to responsibility for the
26-22 complaint, or between any registrant and the consumer, the
26-23 department shall conduct an informal dispute resolution process,
26-24 including a home inspection if appropriate, for a resolution of the
26-25 disputes. If it is possible to secure the agreement of the
26-26 parties, the department shall prepare and file with the director a
26-27 written report of the agreement.
27-1 (g) During the informal dispute resolution process, the
27-2 department shall make a preliminary determination as to the
27-3 responsibility and liability of the manufacturer, retailer, and
27-4 installer for claims determined to be valid. The registrants shall
27-5 be afforded an opportunity to comment on the preliminary
27-6 determination under consideration by the department before the
27-7 department makes a final determination. If a registrant is out of
27-8 business, is no longer registered, or has filed for liquidation or
27-9 reorganization in bankruptcy, the department shall notify the
27-10 registrant's surety and give the registrant's surety an opportunity
27-11 to participate in the informal dispute resolution process. If a
27-12 registrant or the registrant's surety fails or refuses to
27-13 participate in the informal dispute resolution process after
27-14 receiving notice of the claim, the registrant and the registrant's
27-15 surety are bound by the department's final determination of
27-16 responsibility and liability, and the department may suspend or
27-17 revoke the registrant's certificate of registration.
27-18 (h) If the disputed claim is not resolved through the
27-19 informal dispute resolution process, the parties may elect to
27-20 submit the claim for formal, binding arbitration under Title 9,
27-21 United States Code. The director by rule shall establish
27-22 procedures for the binding arbitration process and for the approval
27-23 and selection of arbitrators.
27-24 (i) The fund is not liable for, and the director may not
27-25 pay, any punitive, exemplary, double, or treble damages, or damages
27-26 for pain and suffering, mental anguish, emotional distress, or
27-27 other analogous tort claims. The payment of actual damages is
28-1 limited to the actual, reasonable costs and expenses, not including
28-2 attorney's fees, that the consumer has incurred or will incur to
28-3 correct or resolve the acts or omissions found to be violations as
28-4 set forth in Subsection (e) of this section. By way of further
28-5 limitation, a consumer may not be paid more than $35,000 in actual
28-6 damages, and attorney's fees, costs, and expenses are limited to 20
28-7 percent of the amount of actual damages. Neither the fund nor the
28-8 director is liable to the consumer if the fund does not have the
28-9 funds necessary to pay the actual damages and attorney's fees
28-10 determined to be payable. The director shall record the time and
28-11 date of receipt of all verified complaints and, as funds become
28-12 available, the director shall pay the consumer whose claim is the
28-13 earliest by time and date.
28-14 (j) One million dollars shall be reserved in the fund for
28-15 payment of valid consumer claims. The costs and expenses of the
28-16 director and the department in administering and managing the fund,
28-17 keeping books and records, investigating consumer complaints, and
28-18 conducting the informal dispute resolution process shall be paid
28-19 out of the fund unless the balance of the fund is less than $1
28-20 million. <("registrant") or against the registrant's surety, in
28-21 one of the following situations:>
28-22 <(1) The consumer has obtained a final judgment which
28-23 is unsatisfied against the registrant, its surety, or the
28-24 registrant and its surety jointly and severally, or against the
28-25 registrant only, if the court found that the surety was not liable
28-26 due to prior payments of valid claims against the bond in an amount
28-27 equal to, or greater than, the face amount of the applicable bond.>
29-1 <(2) The consumer has obtained a judgment against the
29-2 surety of the registrant which is unsatisfied.>
29-3 <(3) The consumer has obtained a judgment against a
29-4 registrant which has posted other security in lieu of the bond in
29-5 accordance with Section 13 of this article, and such security is
29-6 insufficient to satisfy the judgment.>
29-7 <(4) The consumer has alleged a claim against the
29-8 registrant in a lawsuit which has been stayed or discharged as a
29-9 result of the filing for reorganization or discharge in bankruptcy
29-10 by the registrant and (1) judgment against the surety is not
29-11 possible because of the bankruptcy or liquidation of the surety or
29-12 because the surety has been found by a court of competent
29-13 jurisdiction not to be liable due to prior payment of valid claims
29-14 against the bond in an amount equal to, or greater than, the face
29-15 amount of the applicable bond; or (2) the registrant has posted
29-16 other security in lieu of the bond.>
29-17 <(f)(1) In order to recover from the fund, the consumer must
29-18 file, in the district courts of Travis County, Texas, an
29-19 application for an order directing payment out of the fund to which
29-20 is attached a verified claim. A copy of the application and
29-21 verified claim must be served on the commission by serving the
29-22 commissioner.>
29-23 <(2) If the consumer has obtained a judgment which is
29-24 unsatisfied against the registrant and/or its surety as set forth
29-25 in Subsection (e)(1), (e)(2), or (e)(3) of this section, the
29-26 verified claim shall contain the following:>
29-27 <(A) evidence satisfactory to the court: (1)
30-1 that the judgment against the registrant, its surety, or the
30-2 registrant and its surety has been entered, or (2) that the
30-3 judgment against the registrant only contains a specific finding
30-4 that the surety has no liability, and that execution has been
30-5 returned nulla bona, and that a judgment lien has been perfected;>
30-6 <(B) the amount of actual damages broken down by
30-7 category as awarded by the court or jury in the cause which
30-8 resulted in the unsatisfied judgment, and the amount of attorney's
30-9 fees, costs, and expenses set forth in the unsatisfied judgment;>
30-10 <(C) the amount of payment or other
30-11 consideration received, if any, from the registrant, the surety, or
30-12 other security posted with the department; and>
30-13 <(D) the amount that may be realized, if any,
30-14 from the sale of real or personal property or other assets of the
30-15 judgment debtors liable to be sold or applied in satisfaction of
30-16 the judgment and the balance remaining due on the judgment after
30-17 application of the amount which may be realized.>
30-18 <(3) If the consumer has alleged a claim as set forth
30-19 in Subsection (e)(4) of this section and for the reasons set forth
30-20 therein has not been able to secure a judgment, the verified claim
30-21 must contain the following:>
30-22 <(A) a true copy of all the pleadings in the
30-23 lawsuit which was stayed or discharged by the bankruptcy court;>
30-24 <(B) a complete list of all complaints against
30-25 the registrant, setting forth the specific acts or omissions
30-26 complained of which resulted in actual damage to the consumer along
30-27 with the actual dollar amount necessary to reimburse or compensate
31-1 the consumer for costs or expenses resulting from the acts or
31-2 omissions of which the consumer complains;>
31-3 <(C) a true copy of any written agreement which
31-4 the consumer has entered into with his or her attorney; or a
31-5 statement as to the oral agreement with the attorney with reference
31-6 to the payment of legal fees and costs; and>
31-7 <(D) true copies of all purchase agreements,
31-8 warranties, notices, requests for warranty service, service or
31-9 repair orders, or papers or documents of any kind whatsoever which
31-10 the consumer received in connection with the purchase, exchange, or
31-11 lease-purchase of the manufactured home and its warranties from
31-12 which the consumer's cause of action arises.>
31-13 <(g) Within 20 days following receipt of service of the
31-14 application and verified claim, the commission may enter an
31-15 appearance on its behalf, file a response, appear at the hearing,
31-16 cross-examine witnesses, or take whatever other action it deems
31-17 appropriate that could have been taken in the original action on
31-18 behalf of, and in the name of, the registrant or surety; in taking
31-19 such action the commission shall act only to protect the fund from
31-20 spurious or unjust claims and to assure compliance with the
31-21 requirements for recovery under this section. If the unsatisfied
31-22 final judgment on which the consumer's claim is based is a default
31-23 judgment, the commission is entitled to a trial de novo for a
31-24 determination of the actual damages, attorney's fees, costs, and
31-25 expenses for which the fund is liable.>
31-26 <(h) The court shall set a hearing on the application at the
31-27 earliest possible time following 30 days from the date on which the
32-1 commission was served. Not less than 10 days' notice shall be
32-2 given the applicant and the commission. The court shall determine
32-3 from the verified complaint or oral testimony at the hearing the
32-4 amount of actual damage which is recoverable by the consumer
32-5 pursuant to the provisions and limitations of Section 13 of this
32-6 article, and the amount of reasonable attorney's fees, costs, and
32-7 expenses which the consumer incurred in the litigation which
32-8 resulted in the judgment or incurred in preparing and prosecuting
32-9 the litigation which was stayed or discharged by the bankruptcy
32-10 court and for legal services, costs, and expenses in recovering
32-11 from the fund. The court shall enter its order specifically
32-12 setting forth the actual damages and attorney's fees, costs, and
32-13 expenses which the commission shall pay to the consumer. Under no
32-14 circumstances shall the order include any punitive, exemplary, or
32-15 double or treble damages nor damages for pain and suffering, mental
32-16 anguish, emotional distress, or any other tort claims which are not
32-17 recoverable against a surety as set forth in Section 13 of this
32-18 article.>
32-19 <(i) Within 30 days following receipt of the order of the
32-20 court, the commission shall pay to the consumer a sum equal to the
32-21 amount of actual damages and attorney's fees, costs, and expenses
32-22 awarded by the court in its order; however, under no circumstances
32-23 shall any consumer be paid more than $30,000 in actual damages or
32-24 an amount in excess of $15,000 for attorney's fees, costs, and
32-25 expenses per home. Prior to payment, the consumer shall execute an
32-26 assignment to the commission of all of the consumer's right, title,
32-27 and interest in and to the unsatisfied judgment and the judgment
33-1 lien or the claim against the registrant and surety.>
33-2 <(j) The commission shall notify the commissioner of the
33-3 name of any manufacturer, retailer, broker, or installer named in a
33-4 judgment which is the basis for a claim against the fund. If the
33-5 person named is still registered with the department, the
33-6 commissioner shall immediately suspend the registration, without
33-7 hearing, by notifying the registrant by certified mail, return
33-8 receipt requested.>
33-9 <(k) The commission, in its discretion, may try to recover
33-10 from the registrant, the judgment debtor, or its surety any sums
33-11 paid to consumers from the fund. Any sums recovered shall be
33-12 deposited to the credit of the fund.>
33-13 (k) <(l)> The provisions of this section do not apply to,
33-14 and a consumer shall not recover against the fund as a result of,
33-15 any claim against a registrant resulting from a cause of action
33-16 directly related to the sale, lease-purchase, exchange, brokerage
33-17 or installation of a manufactured home prior to September 1, 1987.
33-18 <(m) The Texas Department of Licensing and Regulation shall
33-19 serve and act as manager of the fund. The manager shall handle the
33-20 administrative duties of the fund, keep such books and records as
33-21 may be required by the commission, cause appearances to be entered
33-22 in hearings or judicial proceedings as may be necessary to protect
33-23 the fund from spurious or unjust claims and to assure compliance
33-24 with the requirements for recovery under this section, pay claims,
33-25 and invest and reinvest the fund's assets in accordance with
33-26 instructions from the commission. The manager of the fund shall be
33-27 paid its reasonable and necessary costs and expenses for the
34-1 management of the fund; however, such costs and expenses shall only
34-2 be paid out of the interest earnings of the fund and not from the
34-3 proceeds of the additional title fee charge or other assets which
34-4 the fund may recover. The interest earnings from the fund are
34-5 hereby appropriated and reappropriated to the department.>
34-6 <(n) Neither the fund, nor the commission, shall be liable
34-7 to any consumer for recovery if the fund does not have the funds
34-8 necessary to pay the amounts awarded by an order of the court. If
34-9 the fund does not have sufficient assets to pay the consumer, it
34-10 shall log the time and date of receipt of any order by a court for
34-11 payment to a consumer. As funds become available, the commission
34-12 shall pay the consumer whose unpaid order is the earliest by time
34-13 and date.>
34-14 SECTION 10. Section 14, Texas Manufactured Housing Standards
34-15 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
34-16 read as follows:
34-17 Sec. 14. WARRANTIES. (a) The manufacturer shall warrant
34-18 that each new HUD-code manufactured home is constructed or
34-19 assembled in accordance with all building codes, standards,
34-20 requirements, and regulations prescribed by the U.S. Department of
34-21 Housing and Urban Development pursuant to the provisions of the
34-22 National Manufactured Home Construction and Safety Standards Act of
34-23 1974. The manufacturer shall further warrant that the manufactured
34-24 home and all appliances and equipment included in the home are free
34-25 from defects in materials or workmanship.
34-26 (b) The manufacturer's warranty provided for in this section
34-27 must be set forth in a separate written document and is in effect
35-1 for a period of at least one year from the date of initial
35-2 installation of the new HUD-code manufactured home at the
35-3 consumer's homesite.
35-4 (c) The manufacturer shall deliver the manufactured home
35-5 warranty to the retailer at the time of delivery of the home to the
35-6 retailer along with all warranties given by the manufacturers of
35-7 all appliances or equipment installed in the home.
35-8 (d) The retailer shall give the consumer a written warranty
35-9 that the installation of the new HUD-code manufactured home at the
35-10 initial homesite will be completed in accordance with all
35-11 standards, rules, regulations, administrative orders, and
35-12 requirements of the department <commissioner> and that any
35-13 appliances or equipment included with the sale of the home to be
35-14 installed by the retailer have been, or will be, installed in
35-15 accordance with the instructions or specifications of the
35-16 manufacturer of the appliance or equipment and are free from
35-17 defects in materials or workmanship. The retailer's warranty is
35-18 for a period of one year from the date of initial installation of
35-19 the home at the consumer's homesite. The retailer shall deliver to
35-20 the consumer at the time the contract of sale is signed the
35-21 following:
35-22 (1) the manufacturer's warranty;
35-23 (2) the retailer's warranty;
35-24 (3) the warranties for all appliances and equipment
35-25 given by the manufacturers of the appliances and equipment included
35-26 with, or installed in, the home; and
35-27 (4) the name and address of the manufacturer and
36-1 retailer to which the consumer is to give notice of warranty
36-2 service requests.
36-3 (e) <(1)> The consumer shall notify either the retailer or
36-4 the manufacturer, or both, if applicable, in writing of the need
36-5 for warranty service or repairs. Written <; written> notice to the
36-6 department <or to the office of the attorney general> constitutes
36-7 notice to the retailer and manufacturer. The manufacturer or
36-8 retailer, or both, shall take appropriate corrective action within
36-9 a reasonable period of time as required by the rules of the
36-10 department to fulfill their respective written warranty
36-11 obligations.
36-12 (f) <(2)> If the manufacturer or retailer fails to provide
36-13 warranty service within the reasonable time allowed by the rules of
36-14 the director <commissioner>, the manufacturer or retailer must show
36-15 good cause in writing why such service was not provided. Failure
36-16 to show good cause constitutes sufficient basis for suspension or
36-17 revocation of the registration.
36-18 (g) <(3)> If the consumer is not provided proper warranty
36-19 service, the consumer may, at any time, without fee, request the
36-20 department to perform a consumer complaint home inspection.
36-21 (h) <(4)> If the manufacturer or retailer believes the
36-22 consumer's complaints are not covered by the respective warranty,
36-23 believes that the warranty service was previously properly
36-24 provided, or has a dispute as to the respective responsibilities
36-25 pursuant to the warranties, either of them may request the
36-26 department to perform a consumer complaint home inspection along
36-27 with payment of the required inspection fee.
37-1 (i) <(5)> After receipt of a request for a home inspection,
37-2 the department shall <will> perform such inspection within 15 days.
37-3 Within five days following the inspection, the department
37-4 <commissioner> shall mail a written report and orders, if any, to
37-5 the consumer, manufacturer, and retailer by certified mail, return
37-6 receipt requested. The report shall detail each of the consumer's
37-7 complaints, whether or not each complaint is covered by either of
37-8 the warranties and which warranty. The director <commissioner>
37-9 shall issue appropriate orders to the manufacturer or retailer for
37-10 correction or repair of the defects and the time allowed, which
37-11 must be reasonable, for the correction.
37-12 (j) <(6)> The manufacturer and retailer shall comply with
37-13 the initial report and warranty service orders of the director
37-14 <commissioner>. Such orders are not contested cases within the
37-15 meaning of Chapter 2001, Government Code, <the Administrative
37-16 Procedure and Texas Register Act (Article 6252-13a, Vernon's Texas
37-17 Civil Statutes)> so as to provide an opportunity for an
37-18 adjudicative hearing prior to compliance.
37-19 (k) If the manufacturer or retailer, or both, fails or
37-20 refuses to provide the warranty service in accordance with the
37-21 orders of the department following a home inspection, the director
37-22 <commissioner> shall set a hearing at which the manufacturer or
37-23 retailer, or both, shall show cause why the registration should not
37-24 be suspended or revoked. If, following the hearing, the director
37-25 <commissioner> finds that the prior warranty service orders were
37-26 correct, the failure or refusal of the manufacturer or retailer to
37-27 comply with the orders is sufficient cause for the suspension or
38-1 revocation of the registration. If the director <commissioner>
38-2 finds that the prior warranty service orders were incorrect in the
38-3 determination of the respective responsibilities of the
38-4 manufacturer, retailer, or both, the director <commissioner> shall
38-5 enter a final order setting forth <(1)> the correct
38-6 responsibilities<,> and <(2)> the right of either the manufacturer
38-7 or retailer to indemnification from the other. The director
38-8 <commissioner> may also enter an order directing the manufacturer
38-9 or retailer whose registration is not revoked, or who is not out of
38-10 business, to perform the warranty service responsibilities of the
38-11 retailer or manufacturer whose registration is revoked, or who is
38-12 out of business, by giving the manufacturer or retailer performing
38-13 such warranty service the right of indemnity against the other.
38-14 The manufacturer or retailer entitled to indemnification by virtue
38-15 of an order of the director <commissioner> pursuant to this
38-16 subsection is a "consumer" for purposes of Sections 13 and 13A of
38-17 this Act <article> and may recover its actual damages <costs,
38-18 expenses,> and attorney's fees from the <other party's surety,
38-19 other security, or the> manufactured homeowners' recovery fund.
38-20 (l) <(f)> If the new HUD-code manufactured home is moved
38-21 from the initial installation site during the term of the warranty
38-22 period, the manufacturer's and retailer's warranties shall not
38-23 apply to any defect or damage caused by the move. Conspicuous
38-24 notice of this provision shall be given the consumer at the time of
38-25 sale. The burden of proof is placed on the warrantor to establish
38-26 that the defect is caused by the move.
38-27 (m) <(g)> For all secondary installations not covered by the
39-1 retailer's warranty as set forth in Subsection (d) of this section
39-2 and for the installation of all used manufactured homes, the
39-3 installer shall give the manufactured home owner a written warranty
39-4 that the installation of the home was done in accordance with all
39-5 standards, rules, regulations, administrative orders, and
39-6 requirements of the department <commissioner>.
39-7 <(h) If a manufacturer is no longer registered with the
39-8 commissioner or has filed for reorganization or discharge in
39-9 bankruptcy, the commissioner shall give written notice of this fact
39-10 to all registered retailers. The retailer must assume liability,
39-11 and is fully responsible, for the manufacturer's warranty and all
39-12 warranty service as to any new HUD-code manufactured home
39-13 constructed by such manufacturer and sold to a consumer by the
39-14 retailer following receipt of the commissioner's notice. A written
39-15 notice, as required by the commissioner, must be given to the
39-16 consumer by the retailer prior to the execution of a binding
39-17 deposit agreement or retail installment sales contract. The
39-18 retailer is entitled to indemnity from the manufacturer's surety or
39-19 other security, and from the manufactured homeowners' recovery
39-20 fund, for all warranty service performed pursuant to the
39-21 manufacturer's warranty; in this situation the retailer is a
39-22 "consumer" for purposes of recovery against the surety and the fund
39-23 pursuant to the provisions of Sections 13 and 13A of this article.
39-24 Nothing contained in this subsection authorizes a retailer to
39-25 purchase new HUD-code manufactured homes from an unregistered
39-26 manufacturer in violation of Section 6(h) of this article.>
39-27 SECTION 11. Section 17, Texas Manufactured Housing Standards
40-1 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
40-2 read as follows:
40-3 Sec. 17. PENALTIES; JUDICIAL REVIEW. (a) A person,
40-4 individual, or director, officer, or agent of a corporation who
40-5 knowingly and wilfully violates a provision of this Act or any
40-6 rule, regulation, or administrative order of the department
40-7 <commissioner> in a manner that threatens the health or safety of
40-8 any purchaser or consumer commits a Class A misdemeanor and on
40-9 conviction shall be fined not more than $2,000 or shall be confined
40-10 in the county jail not longer than one year or both.
40-11 (b) In addition to the injunctive relief set forth in
40-12 Section 18 of this Act <and notwithstanding the monetary limits of
40-13 penalties established by Section 17, Article 9100, Revised
40-14 Statutes>, a person who fails to obtain or maintain a registration
40-15 as required by this Act <article> may be assessed a civil penalty
40-16 by the director <commissioner> payable to the state in an amount
40-17 not to exceed $10,000 for each violation of this Act <article> in
40-18 addition to the reasonable attorney's fees, court costs, witness
40-19 fees, investigative costs, and deposition expenses.
40-20 (c) Failure by a manufacturer, installer, or retailer to
40-21 comply with the warranty provisions of this Act <article> or any
40-22 implied warranties or the violation of any provision of this Act
40-23 <article> by any person is a deceptive trade practice in addition
40-24 to those practices delineated in Chapter 17, Subchapter E, Business
40-25 & Commerce Code and is actionable as provided by that <pursuant to
40-26 said> subchapter. As such, the venue provisions and all remedies
40-27 available in that <said> subchapter apply to and are cumulative of
41-1 the remedies in this Act <article>. However, notwithstanding any
41-2 provisions of law to the contrary, a lawsuit containing allegations
41-3 that the manufacturer, installer, or retailer failed to perform
41-4 warranty obligations or failed to comply with any written or
41-5 implied warranties shall be abated, provided that a plea in
41-6 abatement is filed with the court not more than 45 days following
41-7 the answer date of the movant, if the manufacturer, installer, or
41-8 retailer requests a consumer complaint inspection pursuant to the
41-9 provisions of Section 14 of this Act <article>. The abatement
41-10 shall continue until the department has performed a consumer
41-11 complaint inspection and the retailer, manufacturer, or both, or
41-12 the installer, has been given an opportunity to comply with the
41-13 inspection report, determinations, and orders of the director
41-14 <commissioner>; however, the abatement shall not be granted for a
41-15 period in excess of 150 days. A consumer's refusal to allow the
41-16 manufacturer, installer, or retailer to perform warranty service
41-17 pursuant to the inspection report, determinations, or orders of the
41-18 director <commissioner> is a bar to any cause of action relating to
41-19 alleged failure to comply with any written or implied warranties or
41-20 perform warranty service.
41-21 (d) Judicial review of an order, decision, or determination
41-22 of the director shall be instituted by filing a petition with a
41-23 district court in Travis County as provided by Chapter 2001,
41-24 Government Code.
41-25 SECTION 12. Sections 18(a)-(f), Texas Manufactured Housing
41-26 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), are
41-27 amended to read as follows:
42-1 (a) Any waiver by a consumer of the provisions of this Act
42-2 <article> is contrary to public policy and is unenforceable and
42-3 void.
42-4 (b) The provisions of all laws, parts of laws, ordinances,
42-5 rules or regulations which are in conflict with any of the
42-6 provisions of this Act <article> are superseded and preempted to
42-7 the extent of such conflict. The proper giving of the warranties
42-8 and notices by the seller as required by the provisions of Section
42-9 8 and Section 14 of this Act <article> is a valid disclaimer of any
42-10 implied warranties of fitness for a particular purpose or of
42-11 merchantability as described in Chapter 2, Business & Commerce
42-12 Code. The failure to give the warranties and notices required by
42-13 the provisions of Section 8 and Section 14 of this Act <article> is
42-14 a deceptive trade practice in addition to those set forth in
42-15 Section 17.50, Business & Commerce Code.
42-16 (c) If any provision of this Act <article> or the
42-17 application thereof to any person or circumstances is held invalid,
42-18 such invalidity shall not affect other provisions or applications
42-19 of this Act <article> which can be given effect without the invalid
42-20 provision or application, and to this end the provisions of this
42-21 Act <article> are declared to be severable. This Act <article>
42-22 shall be liberally construed in its entirety to accomplish the
42-23 purposes set forth in Section 2 of this Act.
42-24 (d) If a retailer, broker, or installer does not possess a
42-25 valid certificate of registration at the time of entering into any
42-26 contract with a consumer, the contract between the consumer and the
42-27 retailer, broker, or installer is voidable within two years from
43-1 the date of the purchase of the manufactured home at the option of
43-2 the consumer. A consumer's contract for the purchase, exchange, or
43-3 lease-purchase of a new manufactured home is also voidable within
43-4 two years from the date of the purchase of the manufactured home,
43-5 if the retailer purchased the home from an unregistered
43-6 manufacturer in violation of Section 6, Subsection (h) of this Act
43-7 <article>.
43-8 (e) Nothing in this Act <article> shall be construed to
43-9 modify or amend any provisions of The Real Estate License Act, as
43-10 amended (Article 6573a, Vernon's Texas Civil Statutes). The
43-11 provisions of this Act <article>, as amended, shall not apply to a
43-12 person licensed as a real estate broker or salesman pursuant to The
43-13 Real Estate License Act, as amended (Article 6573a, Vernon's Texas
43-14 Civil Statutes), who, as agent of the buyer or seller, negotiates
43-15 the sale or lease of a manufactured home and the real property to
43-16 which it is affixed; provided that the ownership of the
43-17 manufactured home and real property are of record in the same
43-18 person and that such sale or lease shall be in a single real estate
43-19 transaction.
43-20 (f) Notwithstanding any provisions of any other statute,
43-21 regulation, or ordinance to the contrary, a registered retailer or
43-22 registered installer is not required to secure any permit,
43-23 certificate, or license or pay any fee for the transportation of
43-24 manufactured housing to the place where it is to be installed
43-25 except as required by the department or by the Texas <State>
43-26 Department of <Highways and Public> Transportation pursuant to
43-27 Article 6701-1/2, Title 116, Revised Statutes. The department
44-1 shall cooperate with the Texas <State> Department of <Highways and
44-2 Public> Transportation by providing current lists of registered
44-3 manufactured housing manufacturers, retailers, and installers.
44-4 SECTION 13. Section 19, Texas Manufactured Housing Standards
44-5 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
44-6 read as follows:
44-7 Sec. 19. MANUFACTURED HOME TITLES. (a) In this section:
44-8 (1) "Debtor" has the same meaning as given it by
44-9 Section 9.105(a)(4), Business & Commerce Code.
44-10 (2) "Document of title" means a written instrument
44-11 issued solely by and under the authority of the director
44-12 <commissioner> that sets forth:
44-13 (A) the name and address of the purchaser and
44-14 seller at the first retail sale, or the transferee and transferor
44-15 at any subsequent sale or transfer;
44-16 (B) the manufacturer's name and address and, if
44-17 any, the model designation;
44-18 (C) in accordance with applicable rules of the
44-19 director <commissioner>, the outside dimensions of the manufactured
44-20 home when installed for occupancy exclusive of the tongue or other
44-21 towing device as measured to the nearest one-half of one foot at
44-22 the base of the home, and the approximate square footage of the
44-23 home when installed for occupancy;
44-24 (D) the identification number or numbers for
44-25 each section or module of the manufactured home;
44-26 (E) the county of this state in which the
44-27 manufactured home is installed for occupancy;
45-1 (F) the dates of any liens, and the names and
45-2 addresses of the lienholders, in chronological order of
45-3 recordation, and if no liens are registered or recorded on the
45-4 manufactured home, a statement of that fact;
45-5 (G) the signature of the owner signed with pen
45-6 and ink on receipt of the certificate;
45-7 (H) that if a husband and wife file, with the
45-8 application for document of title, an agreement signed by both
45-9 providing that the manufactured home is to be held jointly with
45-10 rights of survivorship, the director shall <commissioner will>
45-11 issue the document of title in both names; and
45-12 (I) any other data the director <commissioner>
45-13 requires.
45-14 (3) "First retail sale" means the initial acquisition
45-15 by a consumer of a new manufactured home by purchase, exchange, or
45-16 lease-purchase from a retailer and includes a bargain, sale,
45-17 transfer, or delivery with intent to pass an interest other than a
45-18 lien, to a manufactured home for which a document of title has not
45-19 been previously issued by the director <commissioner>.
45-20 (4) "Identification number" means the permanent number
45-21 affixed to, or imprinted on, a manufactured home or section of the
45-22 home as prescribed by the rules of the department <commissioner>.
45-23 (5) "Inventory" has the meaning given it by Section
45-24 9.109(4), Business & Commerce Code, as amended.
45-25 (6) "Lien" means a security interest that is created
45-26 by any kind of lease, conditional sales contract, deed of trust,
45-27 chattel mortgage, trust receipt, reservation of title, or other
46-1 security agreement of whatever kind or character if an interest,
46-2 other than an absolute title, is sought to be held or given in a
46-3 manufactured home, and any lien on a manufactured home that is
46-4 created or given by the constitution or a statute.
46-5 (7) "Manufacturer's certificate" means a document, or
46-6 a form prescribed by the director <commissioner>, that shows the
46-7 original transfer of a manufactured home from the manufacturer to
46-8 the retailer, and if presented with an application for a document
46-9 of title, the certificate must show, on a form prescribed by the
46-10 director <commissioner>, each subsequent transfer between retailers
46-11 and retailer to owner.
46-12 (8) "Mortgagee" means a secured party or any other
46-13 person who holds a lien on a manufactured home.
46-14 (9) "Mortgagor" means a debtor or other person who
46-15 gives a lien on a manufactured home, any person who agrees that a
46-16 lien may be retained on the home or any part of it, or any person
46-17 against whom a lien arises under the constitution or a statute.
46-18 (10) "Secured party" has the meaning given it by
46-19 Section 9.105(a)(13), Business & Commerce Code.
46-20 (11) "Security interest" has the meaning given it by
46-21 Section 1.201(37), Business & Commerce Code.
46-22 (12) "Security agreement" has the meaning given it by
46-23 Section 9.105(a)(12), Business & Commerce Code.
46-24 (13) "Subsequent sale" means a bargain, sale,
46-25 transfer, or delivery with intent to pass an interest, other than a
46-26 lien, to a manufactured home from a person to another person
46-27 subsequent to the first retail sale and initial issuance of a
47-1 document of title.
47-2 (b) The director <commissioner> shall prescribe forms and
47-3 adopt rules relating to manufacturer's certificates, to
47-4 applications for documents of title, and to the issue of documents
47-5 of title at the first retail sale and for each subsequent sale or
47-6 transfer of a manufactured home.
47-7 (c)<(1)> At the first retail sale, the retailer and
47-8 purchaser shall apply for the issuance of a document of title. As
47-9 a part of the application, the retailer shall surrender the
47-10 original manufacturer's certificate. At a subsequent sale or
47-11 transfer the seller and purchaser, or the transferor and
47-12 transferee, shall apply for the issuance of a new document of
47-13 title. As a part of the application, the seller or transferor shall
47-14 surrender the original document of title.
47-15 (d) <(2)> The department <commissioner> may not refuse to
47-16 issue a document of title, and may not suspend or revoke a document
47-17 of title, unless:
47-18 (1) <(A)> the application contains any false or
47-19 fraudulent statement, <or> the applicant has failed to furnish
47-20 information required by the director <commissioner>, or the
47-21 applicant is not lawfully entitled to the issuance of a document of
47-22 title;
47-23 (2) <(B)> the director <commissioner> has reasonable
47-24 basis to believe that the manufactured home has been stolen or
47-25 unlawfully converted, or the issuance of a document of title would
47-26 constitute a fraud against the rightful owner or a lienholder;
47-27 (3) <(C)> the director <commissioner> has reasonable
48-1 basis to believe that the manufactured home is "salvaged" as
48-2 defined in Section 8 of this Act <article> and a salvage title has
48-3 not been applied for;
48-4 (4) <(D)> the required fee has not been paid;
48-5 (5) <(E)> the state sales and use tax has not been
48-6 paid in accordance with the provisions of Chapter 158, Tax Code,
48-7 and its subsequent amendments, and Subsection (j) <(h)> of this
48-8 section; or
48-9 (6) <(F)> a local tax lien has been filed and recorded
48-10 pursuant to Section 32.015, Property Tax Code.
48-11 (e) <(3)> If the director <commissioner> refuses to issue,
48-12 or suspends or revokes, a document of title, written notice of such
48-13 action must be given by certified mail to the seller and purchaser,
48-14 or transferor and transferee, and to the holder of a lien or
48-15 security interest of record. Such action by the director
48-16 <commissioner> is a contested case under Chapter 2001, Government
48-17 Code <within the meaning of the Administrative Procedure and Texas
48-18 Register Act, as amended (Article 6252-13a, Vernon's Texas Civil
48-19 Statutes)>. Notice of the appeal and request for hearing must be
48-20 filed with the director <commissioner> within 30 days following
48-21 notice of the director's <commissioner's> action.
48-22 (f) <(d)> If there are no liens registered or recorded, the
48-23 department <commissioner> shall issue a document of title marked
48-24 "ORIGINAL" on its face and shall send the original by first class
48-25 mail to the purchaser or transferee at the address on the
48-26 application. If a lien is shown in the application or recorded
48-27 with the department, the department <commissioner> shall issue a
49-1 document of title marked "ORIGINAL" on its face and send the
49-2 original by first class mail to the first lienholder. The
49-3 department <commissioner> shall mail, first class, a copy of the
49-4 document of title conspicuously marked "NONTRANSFERABLE COPY" on
49-5 its face to the purchaser or transferee and any other lienholder at
49-6 the address shown on the application.
49-7 (g) <(e)> The owner designated in the original document of
49-8 title must transfer the title on a form prescribed by the director
49-9 <commissioner executed before a notary public> and must file the
49-10 form with the department before a manufactured home may be
49-11 conveyed, transferred, or otherwise disposed of at a subsequent
49-12 sale. The form must include any information the director
49-13 <commissioner> requires and must include a statement <an affidavit>
49-14 that the person signing is the owner of the manufactured home and
49-15 that there are no liens on the home except a lien shown on the
49-16 document of title <or described in the affidavit>. A title to a
49-17 manufactured home may not pass or vest at a subsequent sale until
49-18 the transfer is executed as provided by this section and an
49-19 application for the issuance of a new document of title is sent to
49-20 the department.
49-21 (h) <(f)> When the ownership of a manufactured home in this
49-22 state is transferred by operation of law, as in an inheritance, a
49-23 devise, or a bequest, bankruptcy, receivership, judicial sale, or
49-24 any involuntary divestiture of ownership, the department
49-25 <commissioner> shall issue a new document of title when the
49-26 department is provided with a certified copy of the order or bill
49-27 of sale from an officer making a judicial sale, or the order
50-1 appointing a temporary administrator, the probate proceedings, the
50-2 letters testamentary, the letters of administration, or an
50-3 affidavit by all of the heirs at law showing that no administration
50-4 is necessary and showing in whose name the certificate should be
50-5 issued. If a security interest or other lien is foreclosed in
50-6 accordance with law by nonjudicial means and the secured party or
50-7 other mortgagee files an affidavit with the department showing the
50-8 nonjudicial foreclosure in accordance with law, the department
50-9 <commissioner> may issue a new document of title in the name of the
50-10 purchaser at the foreclosure sale. If the foreclosure is of a
50-11 constitutional or statutory lien and the person entitled to the
50-12 lien <mortgagee> files an affidavit showing the creation of the
50-13 lien and of the divestiture of title because of the lien in
50-14 accordance with law, the department <commissioner> may issue a new
50-15 document of title in the name of the purchaser. If an agreement
50-16 providing for right of survivorship is signed by the husband and
50-17 wife and if on the death of either spouse the department is
50-18 provided with a copy of the death certificate of the deceased
50-19 spouse, the department <commissioner> shall issue a new document of
50-20 title to the surviving spouse.
50-21 (i) <(g)> If an original document of title is lost or
50-22 destroyed, the owner or lienholder may obtain a certified copy of
50-23 the original from the department by making an affidavit on a form
50-24 prescribed by the director. The department <commissioner; but the
50-25 commissioner> shall issue the certified copy only to the first
50-26 lienholder if a lien is disclosed on the original. The certified
50-27 copy shall be conspicuously marked "CERTIFIED COPY OF ORIGINAL" on
51-1 its face. If the original is recovered, the owner or lienholder
51-2 shall immediately surrender the original to the department with the
51-3 certified copy of the original document of title, and the
51-4 department <commissioner> shall issue a new original document of
51-5 title.
51-6 (j) <(h)> The department may <commissioner shall> not issue
51-7 titles to new manufactured homes installed for use and occupancy in
51-8 this state unless the state sales and use tax has been paid. Proof
51-9 of payment may be shown in any manner as may be prescribed at the
51-10 discretion of the department.
51-11 (k) <(i)> A lien on the manufactured homes in the inventory
51-12 is perfected by filing a security agreement with the department in
51-13 a form that contains the information the director <commissioner>
51-14 requires. Once perfected, the lien applies to the manufactured
51-15 homes in the inventory as well as to any proceeds of the sale of
51-16 those homes. Failure to pay or satisfy any inventory lien filed
51-17 and recorded against a manufactured home pursuant to the terms of
51-18 the security agreement by the retailer is sufficient cause to
51-19 revoke or suspend the retailer's registration with the department
51-20 <commissioner>.
51-21 (l) <(j)> If a manufactured home is permanently affixed to
51-22 real estate <by installation on a permanent foundation, as defined
51-23 by the department>, the manufacturer's certificate or the original
51-24 document of title may be surrendered to the department for
51-25 cancellation. The legal description or the appropriate tract or
51-26 parcel number <address and location> of the real estate must be
51-27 given to the department when the certificate or document of title
52-1 is surrendered. The director <commissioner> may require the filing
52-2 of other information. The department <commissioner> may not cancel
52-3 a manufacturer's certificate or a document of title if a lien has
52-4 been registered or recorded on the manufactured home. If a lien
52-5 has been registered or recorded, the department <commissioner>
52-6 shall notify the owner and each lienholder that the title and a
52-7 description of the lien have been surrendered to the department and
52-8 that the department may <commissioner will> not cancel the title
52-9 until the lien is released. Permanent attachment to real estate
52-10 does not affect the validity of a lien recorded or registered with
52-11 the department before the manufactured home is permanently
52-12 attached. The rights of a prior lienholder pursuant to a security
52-13 agreement or the provisions of a credit transaction and the rights
52-14 of the state pursuant to a tax lien are preserved. The department
52-15 shall issue a certificate of attachment to real estate to the
52-16 person who surrenders the manufacturer's certificate or document of
52-17 title. The certificate or document must contain the legal
52-18 description or the appropriate tract or parcel number of the real
52-19 estate and the identification number of the home, and must certify
52-20 that the manufacturer's certificate or original document of title
52-21 has been canceled.
52-22 (m) <(k)> The registration and recordation of a lien with
52-23 the department is notice to all persons that the lien exists.
52-24 Liens recorded or registered with the department have priority, in
52-25 the chronological order of recordation, over other liens or claims
52-26 against the manufactured home, other than as expressly provided by
52-27 Chapter 32, Tax Code.
53-1 (n) <(l)> Notwithstanding any other provisions of this
53-2 section, the filing of a security agreement by a secured party
53-3 perfecting a lien in the inventory of a retailer may <shall> not
53-4 prevent a buyer in the ordinary course of business as defined by
53-5 Sections 1.201(9) and 9.307(a) of the Business & Commerce Code from
53-6 acquiring good title free and clear of such interest, and the
53-7 department may <commissioner shall> not consider such security
53-8 interest as a lien for the purpose of title issuance.
53-9 (o) <(m)> The department <commissioner> shall furnish each
53-10 county tax assessor-collector in this state a quarterly report that
53-11 lists the name of the owner of each manufactured home installed in
53-12 the county during the preceding calendar quarter, the name of the
53-13 manufacturer, the model designation, the identification number of
53-14 each section or module, and the address or location where the
53-15 manufactured home is installed. The report shall include the same
53-16 information for all manufactured homes previously installed in the
53-17 county for which a transfer of ownership was recorded by the
53-18 issuance of a document of title during the quarter. The director
53-19 <commissioner> shall furnish a copy of the report to the chief
53-20 appraiser of the appraisal district established for the county in
53-21 which the manufactured home is installed.
53-22 (p) This Act supersedes <(n) The express provisions of this
53-23 article supersede> any conflicting provisions of the Business &
53-24 Commerce Code; otherwise, the provisions of the Business & Commerce
53-25 Code apply to transactions relating to manufactured housing.
53-26 (q) <(o)> A certificate of title to a manufactured home
53-27 issued pursuant to the Certificate of Title Act, as amended
54-1 (Article 6687-1, Vernon's Texas Civil Statutes), before March 1,
54-2 1982, is subject to this Act <article>. A lien registered or
54-3 recorded with the Texas <State> Department of <Highways and Public>
54-4 Transportation or a predecessor agency of that department before
54-5 March 1, 1982, for the purposes of this Act <article> is registered
54-6 or recorded with the department.
54-7 (r) <(p)> Each month the Texas <State> Department of
54-8 <Highways and Public> Transportation shall send the department
54-9 either a copy of each permit issued in the preceding month for the
54-10 movement of manufactured housing on the highways or a list of the
54-11 permits issued and the information on the permits. The department
54-12 shall pay the reasonable cost of providing the copies or the list
54-13 and information.
54-14 (s) <(q)> The director <commissioner> shall adopt rules
54-15 consistent with this Act <article> for the titling of a
54-16 manufactured home that has been previously registered or titled in
54-17 this state or any other state. The rules must protect a lienholder
54-18 recorded on a certificate or document of title.
54-19 (t) <(r)> The board <commission> shall set fees for issuing
54-20 and cancelling titles to manufactured housing. The fees <which>
54-21 shall include $10 for each title transaction which shall be <paid
54-22 to the State Treasury and> deposited in a special account <fund> to
54-23 be known as the manufactured homeowners' recovery fund and used for
54-24 the purposes established under Section 13A of this Act. <The
54-25 unexpended balance in the manufactured homeowners' recovery fund on
54-26 September 1, 1989, and $10 of each title transaction fee collected
54-27 after that date are hereby appropriated and reappropriated to the
55-1 commission for payment of claims pursuant to Section 13A of this
55-2 article.> The balance of the fee for each title transaction is
55-3 hereby appropriated, and reappropriated, to the department in
55-4 addition to its general appropriation to be used exclusively for
55-5 enforcement of this Act <article>.
55-6 (u) <(s)> The department shall print on every document of
55-7 title issued <by the commissioner> under this section a notice that
55-8 the document of title may not reflect the existence of a tax lien
55-9 notice filed for the manufactured home since the document of title
55-10 was issued and that information about tax liens for which notice
55-11 has been filed may be obtained from the department on written
55-12 request.
55-13 (v) <(t)> On the written request of a person containing the
55-14 name of the owner of a manufactured home having a document of title
55-15 or the identification number of a manufactured home, the department
55-16 <commissioner> shall furnish information held by the department on
55-17 the current ownership of the manufactured home and the existence of
55-18 any tax liens on the manufactured home for which notice has been
55-19 filed with the department.
55-20 (w) <(u)> The department <commissioner> shall cancel titles
55-21 to manufactured homes which have been sold, exchanged, or
55-22 lease-purchased to purchasers for the purchasers' business use.
55-23 New titles may be issued on proper application following an
55-24 inspection and determination that the home is habitable. The
55-25 department <commissioner> shall issue salvage titles for salvaged
55-26 manufactured homes, as defined in Section 8 of this Act <article>,
55-27 and may issue new titles if the new home is rebuilt pursuant to the
56-1 rules and regulations of the director <commissioner>.
56-2 SECTION 14. Section 20, Texas Manufactured Housing Standards
56-3 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
56-4 read as follows:
56-5 Sec. 20. NOTICE TO CONSUMERS BEFORE TITLE TRANSFER. (a) A
56-6 retailer or manufacturer shall not transfer title to a HUD-Code
56-7 manufactured home nor otherwise sell, assign or convey a HUD-Code
56-8 manufactured home to a consumer without delivering the formaldehyde
56-9 health notice required by this section subject to applicable rules
56-10 of the director <commissioner>. The notice shall be delivered to
56-11 the consumer prior to the execution of any mutually binding sales
56-12 agreement or retail installment sales contract.
56-13 (b) The content of the notice shall be the same as required
56-14 by the U.S. Department of Housing and Urban Development and of such
56-15 type, size, and format as prescribed by the director
56-16 <commissioner>. A retailer or manufacturer shall not vary the
56-17 provisions or form of the notice; it is sufficient and adequate, as
56-18 a matter of law, to advise consumers of the risks of occupying the
56-19 home. The consumer's written acknowledgement of receipt of the
56-20 notice is conclusive proof of the delivery of the notice and the
56-21 posting of the notice in compliance with federal regulations.
56-22 (c) The knowing and willful failure of a retailer or a
56-23 manufacturer to comply with the applicable regulations of the U.S.
56-24 Department of Housing and Urban Development and of the director
56-25 <commissioner> is conclusive that such person breached the duty to
56-26 notify the consumer about formaldehyde and that the home is not
56-27 habitable; compliance with such applicable regulations by a
57-1 retailer or a manufacturer is conclusive that the consumer received
57-2 sufficient and adequate notice of the risks of occupying the home
57-3 and that the home is habitable as regards formaldehyde emissions.
57-4 (d) The knowing and willful failure of a retailer or a
57-5 manufacturer, from September 1, 1981, to September 1, 1985, to
57-6 comply with the applicable provisions of this section <Section 20,
57-7 Texas Manufactured Housing Standards Act (Article 5221f, Vernon's
57-8 Texas Civil Statutes),> and the revised formaldehyde warning as
57-9 promulgated by the department continues to be conclusive that such
57-10 person breached the duty to notify the consumer about formaldehyde
57-11 and that the home is not habitable; compliance, from September 1,
57-12 1981, to September 1, 1985, with the applicable provisions of this
57-13 section <Section 20, Texas Manufactured Housing Standards Act
57-14 (Article 5221f, Vernon's Texas Civil Statutes),> and the revised
57-15 formaldehyde warning as promulgated by the department continues to
57-16 be conclusive that the consumer received sufficient and adequate
57-17 notice of the risks of occupying the home and that the home is
57-18 habitable as regards formaldehyde emissions.
57-19 SECTION 15. Title 1, Property Code, is amended by adding
57-20 Chapter 2 to read as follows:
57-21 CHAPTER 2. NATURE OF PROPERTY
57-22 Sec. 2.001. MANUFACTURED HOUSING. (a) Except as provided
57-23 by Subsection (b), a manufactured home is personal property.
57-24 (b) A manufactured home is real property if:
57-25 (1) the home is permanently attached to real property;
57-26 and
57-27 (2) the manufacturer's certificate of origin or the
58-1 original document of title is surrendered for cancellation and a
58-2 certificate of attachment described by the Texas Manufactured
58-3 Housing Standards Act (Article 5221f, Vernon's Texas Civil
58-4 Statutes) is filed in the real property records of the county in
58-5 which the home is located.
58-6 (c) In this section, "manufactured home" has the meaning
58-7 assigned by the Texas Manufactured Housing Standards Act (Article
58-8 5221f, Vernon's Texas Civil Statutes).
58-9 (d) This section does not affect or change the
58-10 classification of a manufactured home as personal or real property
58-11 if the manufactured home was permanently affixed to real property
58-12 before January 1, 1996.
58-13 SECTION 16. Subsection B, Article 6701-1/2, Revised
58-14 Statutes, is amended by amending Subdivision (1) and adding
58-15 Subdivision (3) to read as follows:
58-16 B. (1) The application for a permit and the permit shall be
58-17 in the form as prescribed by the Texas <State> Department of
58-18 <Highways and Public> Transportation; however, the permit must
58-19 contain the complete identification or serial number or the
58-20 Department of Housing and Urban Development label number or state
58-21 seal number of the manufactured home, the name of the owner of the
58-22 home, the location from which the home is being moved, the location
58-23 to which the home is being delivered, and the overall length,
58-24 width, and height of the <manufactured> home and the towing vehicle
58-25 in combination. The overall combined length of the manufactured
58-26 home and the towing vehicle shall include the length of the hitch
58-27 or towing device. The height shall be measured from the roadbed to
59-1 the highest elevation of the manufactured home. The width of the
59-2 home or section shall include any roof or eave extension or
59-3 overhang on either side.
59-4 (3) If the movement of a manufactured home under a
59-5 permit issued by the Texas Department of Transportation begins or
59-6 ends in a county in this state, the department shall send on a
59-7 quarterly basis a copy of the permit, or furnish the essential
59-8 information in the permit, to the chief appraiser of the appraisal
59-9 district for each county in which the movement begins or ends.
59-10 SECTION 17. Subsection C, Article 6701-1/2, Revised
59-11 Statutes, is amended to read as follows:
59-12 C. (1) The Texas <State> Department of <Highways and
59-13 Public> Transportation shall only issue permits to persons
59-14 registered as manufacturers, installers, or retailers with the
59-15 Texas Department of Housing and Community Affairs <commissioner of
59-16 licensing and regulation> or motor carriers registered with the
59-17 <certificated for the transportation of manufactured housing by the
59-18 Railroad Commission of> Texas Department of Transportation <or the
59-19 Interstate Commerce Commission> except as otherwise expressly
59-20 authorized by this section. The registration number or the motor
59-21 carrier <certificate> number of the person to whom the permit is
59-22 issued shall be affixed to the rear of the manufactured home during
59-23 transportation with letters and numbers which are at least eight
59-24 (8) inches in height.
59-25 (2) The Texas <State> Department of <Highways and Public>
59-26 Transportation may issue single trip permits to owners of
59-27 manufactured homes provided that the ownership of the manufactured
60-1 home and of the towing vehicle is shown to be the same person by
60-2 the title to the home and to the towing vehicle or that a lease
60-3 duly filed pursuant to Chapter 209, Acts of the 53rd Legislature,
60-4 Regular Session, 1953 (Article 6701c-1, Vernon's Texas Civil
60-5 Statutes), shows the owner of the manufactured home to be the
60-6 lessee of the towing vehicle. Single trip permits may also be
60-7 issued to installers registered with the Texas Department of
60-8 Housing and Community Affairs <Labor and Standards> for the
60-9 transportation of manufactured homes over routes between points
60-10 when such transportation would be excluded from regulation under
60-11 Chapter 314, Acts of the 41st Legislature, Regular Session, 1929
60-12 (Article 911b, Vernon's Texas Civil Statutes). The owner or
60-13 installer must have proof of insurance coverage in force as
60-14 required in Section H of this article.
60-15 SECTION 18. Subsection D, Article 6701-1/2, Revised
60-16 Statutes, is amended to read as follows:
60-17 D. A fee of Twenty <Fifteen> Dollars ($20) <($15) for each
60-18 permit> shall be collected by the Texas <State> Department of
60-19 <Highways and Public> Transportation. Thirty cents ($0.30) shall
60-20 be deposited to the credit of the state highway fund and the
60-21 balance of each fee shall be <and> deposited in the Treasury of the
60-22 State of Texas to the credit of the General Revenue Fund. Sections
60-23 403.094(h) and 403.095, Government Code, do not apply to funds
60-24 deposited in the state highway fund under this subsection. The <On
60-25 application said> department may <shall> issue permit books <or
60-26 packets containing twenty (20) individual permits provided that the
60-27 aggregate fee of Fifteen Dollars ($15) per permit is received with
61-1 such application. The book-type permit can be used for the
61-2 movement of any manufactured home regardless of width, length, or
61-3 height>, and route approval may <can> be secured by telephone from
61-4 the issuing office along with any required validation number for
61-5 the permit. In lieu of the permit books <or packets>, the <said>
61-6 department may establish an escrow account for the payment of
61-7 permit fees.
61-8 SECTION 19. Subsection E(1), Article 6701-1/2, Revised
61-9 Statutes, is amended to read as follows:
61-10 (1) Except as otherwise provided by this subdivision,
61-11 all <All> manufactured homes which exceed twelve (12) feet in total
61-12 width shall have one rotating amber beacon of not less than eight
61-13 (8) inches mounted somewhere on the roof at the rear of the
61-14 manufactured home. In addition the towing vehicle shall have one
61-15 rotating amber beacon of not less than eight (8) inches mounted on
61-16 top of the cab. These beacons shall be operational during any
61-17 permitted move over the highways, roads, and streets of this state.
61-18 Instead of a roof beacon, two (2) five-inch flashing amber lights
61-19 may be mounted approximately six (6) feet from ground level at the
61-20 rear corners of the manufactured home.
61-21 SECTION 20. Section 32.014(a), Tax Code, is amended to read
61-22 as follows:
61-23 (a) A tax lien to secure the payment of a tax and any
61-24 penalties and interest imposed on a manufactured home does not
61-25 attach to the real property on which the manufactured home is
61-26 located, even if the manufactured home is affixed to the real
61-27 property by installation on a permanent foundation, if on the
62-1 January 1 on which the tax is imposed, the manufactured home is
62-2 subject to a lien of record on a document of title issued on the
62-3 manufactured home by the Texas Department of Housing and Community
62-4 Affairs <commissioner of licensing and regulation>. If such a lien
62-5 is not of record on January 1 and the ownership of the manufactured
62-6 home and the real property is the same, the manufactured housing
62-7 may be appraised and taxed as an improvement to real property,
62-8 notwithstanding any other law relating to the classification of
62-9 manufactured housing as real or personal property.
62-10 SECTION 21. Section 32.015, Tax Code, is amended to read as
62-11 follows:
62-12 Sec. 32.015. Recording Tax Lien on Manufactured Home. (a)
62-13 The collector for a taxing unit may file notice of the unit's tax
62-14 lien on a manufactured home with the department <Texas Department
62-15 of Licensing and Regulation> if the tax has not been paid by
62-16 January 31 of the year following the year for which the tax is
62-17 imposed <assessed>. The notice must include:
62-18 (1) the name and address of the owner of the
62-19 manufactured home; and
62-20 (2) the amount of tax owed, the tax year for which the
62-21 tax was imposed, and the name of the taxing unit that imposed the
62-22 tax; and
62-23 (3) the complete <correct> identification number or
62-24 serial number of the manufactured home, or the Department of
62-25 Housing and Urban Development label number or state seal number.
62-26 (b) The collector may simultaneously file notice of tax
62-27 liens of all the taxing units served by the collector. However,
63-1 notice of any lien for taxes for the prior calendar year must be
63-2 filed with the department <Texas Department of Licensing and
63-3 Regulation> prior to September 1 of the following year. Any lien
63-4 for which the notice is not filed by such date is extinguished and
63-5 is not enforceable.
63-6 (c) If the complete identification or serial number or the
63-7 Department of Housing and Urban Development label number or state
63-8 seal number of the home on the tax lien notice matches that of a
63-9 <the> title of record, the department <Texas Department of
63-10 Licensing and Regulation> shall record the tax lien on the title
63-11 records of the manufactured home. Simultaneously with the recording
63-12 of a tax lien, the department <Texas Department of Licensing and
63-13 Regulation> must mail a notice of the tax lien to any other
63-14 lienholders of record.
63-15 (d) The department shall record the tax lien under
63-16 Subsection (c) even if the person listed as the owner on the
63-17 department's title records is not the person who owned the
63-18 manufactured home on the date that the tax was imposed. Recording
63-19 of the tax lien does not invalidate a title document or a
63-20 certificate of title for the manufactured home that was previously
63-21 issued by the department.
63-22 (e) <(d)> For all manufactured homes sold, or to which
63-23 ownership is transferred, after December 31, 1985, the recording of
63-24 a tax lien under this section constitutes constructive notice of
63-25 the existence of the tax lien to all purchasers of the manufactured
63-26 home who purchase it after the date of recordation of the lien and
63-27 before a tax certificate or paid tax receipt is filed pursuant to
64-1 Subsection (g) <(e) of this section canceling the lien>.
64-2 (f) When the ownership of a manufactured home is
64-3 transferred, the subsequent owner and the lienholder of the home is
64-4 considered to have notice of the ad valorem taxes imposed on the
64-5 home for the current tax year or for the previous tax year if the
64-6 time for filing a notice of a tax lien under Subsection (b) has not
64-7 expired.
64-8 (g) <(e)> On payment of the taxes, penalties, and interest
64-9 for a year for which a valid tax lien has been recorded on the
64-10 title records of the department <Texas Department of Licensing and
64-11 Regulation>, the collector for the taxing unit shall issue a tax
64-12 certificate showing no taxes due or a tax paid receipt for such
64-13 year to the person making payment. When the tax certificate
64-14 showing no taxes due or tax paid receipt is filed with the
64-15 department <Texas Department of Licensing and Regulation>, the tax
64-16 lien is extinguished and canceled and shall be removed from the
64-17 title records of the manufactured home. The collector for a taxing
64-18 unit may not refuse to issue a tax paid receipt to the person who
64-19 offers to pay the taxes, penalties, and interest for a particular
64-20 year or years, even though taxes may also be due for another year
64-21 or other years.
64-22 (h) If a manufactured home for which a notice of a tax lien
64-23 is timely filed does not have a title recorded on the records of
64-24 the department, the tax lien is not extinguished and is
64-25 enforceable. <(f) The provisions of this section shall not apply
64-26 to a taxing unit, or any lien filed by a taxing unit, which
64-27 regulates manufactured housing for siting or zoning purposes in a
65-1 manner which is different from such regulation of site-built
65-2 housing.>
65-3 (i) <(g)> In this section, "department," "label," "seal,"
65-4 and "manufactured home" have <has> the meanings <meaning> assigned
65-5 by <Subsection (s),> Section 3, Texas Manufactured Housing
65-6 Standards Act (Article 5221f, Vernon's Texas Civil Statutes);
65-7 however, the term "manufactured home" does not include a <apply to
65-8 any> manufactured home that <which> has been attached to real
65-9 property <estate> and for which the document of title has been
65-10 canceled under <pursuant to Subsection (j) of> Section 19(l) of
65-11 that Act <said Act>.
65-12 SECTION 22. Section 32.03(b), Tax Code, is amended to read
65-13 as follows:
65-14 (b) A bona fide purchaser for value or the holder of a lien
65-15 recorded on the manufactured home document of title is not required
65-16 to pay any taxes, penalties, or interest except for those years for
65-17 which a valid tax lien has been duly filed and recorded under
65-18 <pursuant to the provisions of> Section 32.015 of this code and
65-19 those years for which the owner of the manufactured home has
65-20 constructive notice of the taxes under Section 32.015(e) of this
65-21 code. In this section, <A> "manufactured home" has the meaning
65-22 assigned by <set forth in> Section 32.015(i) <32.015(g)> of this
65-23 code.
65-24 SECTION 23. Section 2306.021(b), Government Code, is amended
65-25 to read as follows:
65-26 (b) The department is composed of:
65-27 (1) the community affairs division;
66-1 (2) the housing finance division; <and>
66-2 (3) the manufactured housing division; and
66-3 (4) any other division created by the director.
66-4 SECTION 24. Chapter 2306, Government Code, is amended by
66-5 adding Subchapter Y to read as follows:
66-6 SUBCHAPTER Y. MANUFACTURED HOUSING DIVISION
66-7 Sec. 2306.601. REGULATION AND ENFORCEMENT. The department
66-8 shall administer and enforce the Texas Manufactured Housing
66-9 Standards Act (Article 5221f, Vernon's Texas Civil Statutes)
66-10 through the manufactured housing division. The board and the
66-11 director shall exercise authority and responsibilities assigned to
66-12 them under that Act.
66-13 Sec. 2306.602. PERSONNEL. The director may employ staff as
66-14 necessary to perform the work of the manufactured housing division
66-15 and may prescribe their duties and compensation. Subject to
66-16 applicable personnel policies and regulations, the director may
66-17 remove any division employee.
66-18 Sec. 2306.603. RULES. (a) The director shall adopt rules
66-19 as necessary to implement this subchapter and to administer and
66-20 enforce the manufactured housing program through the manufactured
66-21 housing division. Rules adopted by the director are subject to
66-22 Chapter 2001, Government Code.
66-23 (b) The director may not adopt rules restricting competitive
66-24 bidding or advertising by a person regulated by the division except
66-25 to prohibit false, misleading, or deceptive practices by that
66-26 person.
66-27 (c) The director may not include in the rules to prohibit
67-1 false, misleading, or deceptive practices by a person regulated by
67-2 the division a rule that:
67-3 (1) restricts the use of any advertising medium;
67-4 (2) restricts the person's personal appearance or the
67-5 use of the person's voice in an advertisement;
67-6 (3) relates to the size or duration of an
67-7 advertisement used by the person; or
67-8 (4) restricts the use of a trade name in advertising
67-9 by the person.
67-10 Sec. 2306.604. SANCTIONS AND PENALTIES. (a) The director
67-11 shall adopt rules relating to the administrative sanctions that may
67-12 be enforced against a person regulated by the manufactured housing
67-13 division. If the person violates a law relating to the regulation
67-14 of manufactured housing or a rule or order adopted or issued by the
67-15 director relating to the program, the director may:
67-16 (1) issue a written reprimand to the person that
67-17 specifies the violation;
67-18 (2) revoke or suspend the person's certificate of
67-19 registration; or
67-20 (3) place on probation a person whose certificate of
67-21 registration has been suspended.
67-22 (b) In addition to or in lieu of a sanction imposed under
67-23 Subsection (a) of this section, the board may assess an
67-24 administrative penalty in an amount not to exceed $1,000 for each
67-25 violation.
67-26 (c) If a suspension is probated, the director may require
67-27 the person to report regularly to the director on matters that are
68-1 the basis of the probation.
68-2 (d) If the director proposes to suspend or revoke a
68-3 certificate of registration or the director proposes to assess an
68-4 administrative penalty against a person regulated by the division,
68-5 the person is entitled to a hearing before a hearings officer
68-6 appointed by the director. The director by rule shall prescribe
68-7 the procedures by which a decision to suspend or revoke a
68-8 certificate of registration or to assess an administrative penalty
68-9 are made and are appealable.
68-10 (e) In determining the amount of an administrative penalty
68-11 assessed under this section, the board shall consider:
68-12 (1) the seriousness of the violation;
68-13 (2) the history of previous violations;
68-14 (3) the amount necessary to deter future violations;
68-15 (4) efforts made to correct the violation; and
68-16 (5) any other matters that justice may require.
68-17 (f) If, after investigation of a possible violation and the
68-18 facts surrounding that possible violation, the director determines
68-19 that a violation has occurred, the director shall issue a
68-20 preliminary report stating the facts on which the conclusion that a
68-21 violation occurred is based, recommending that an administrative
68-22 penalty under this section be imposed on the person charged, and
68-23 recommending the amount of that proposed penalty. The director
68-24 shall base the recommended amount of the proposed penalty on the
68-25 seriousness of the violation determined by consideration of the
68-26 factors set forth in Subsection (e) of this section.
68-27 (g) Not later than the 14th day after the date on which the
69-1 preliminary report is issued, the director shall give written
69-2 notice of the violation to the person charged. The notice shall
69-3 include:
69-4 (1) a brief summary of the charges;
69-5 (2) a statement of the amount of the penalty
69-6 recommended; and
69-7 (3) a statement of the right of the person charged to
69-8 a hearing on the occurrence of the violation, the amount of the
69-9 penalty, or both the occurrence of the violation and the amount of
69-10 the penalty.
69-11 (h) Not later than the 20th day after the date on which the
69-12 notice is received, the person charged may accept the determination
69-13 of the director made under Subsection (f) of this section,
69-14 including the recommended penalty, or make a written request for a
69-15 hearing on that determination.
69-16 (i) If the person charged with the violation accepts the
69-17 determination of the director, the director shall issue an order
69-18 approving the determination and ordering that the person pay the
69-19 recommended penalty.
69-20 (j) If the person charged fails to respond in a timely
69-21 manner to the notice or if the person requests a hearing, the
69-22 director shall set a hearing, give written notice of the hearing to
69-23 the person, and designate a hearings examiner to conduct the
69-24 hearing. The hearings examiner shall make findings of fact and
69-25 conclusions of law and shall promptly issue to the board a proposal
69-26 for decision as to the occurrence of the violation and a
69-27 recommendation as to the amount of the proposed penalty if a
70-1 penalty is determined to be warranted. Based on the findings of
70-2 fact and conclusions of law and the recommendations of the hearings
70-3 examiner, the board by order may find that a violation has occurred
70-4 and may assess a penalty, or may find that no violation has
70-5 occurred.
70-6 (k) The director shall give notice of the board's order to
70-7 the person charged. The notice must include:
70-8 (1) separate statements of the findings of fact and
70-9 conclusions of law;
70-10 (2) the amount of any penalty assessed;
70-11 (3) a statement of the right of the person charged to
70-12 judicial review of the commission's order; and
70-13 (4) any other information required by law.
70-14 (l) Not later than the 30th day after the date on which the
70-15 decision is final, the person charged shall:
70-16 (1) pay the penalty in full; or
70-17 (2) if the person files a petition for judicial review
70-18 contesting the fact of the violation, the amount of the penalty, or
70-19 both the fact of the violation and the amount of the penalty:
70-20 (A) forward the amount assessed to the
70-21 department for deposit in an escrow account;
70-22 (B) in lieu of payment into escrow, post with
70-23 the department a supersedeas bond for the amount of the penalty, in
70-24 a form approved by the director and effective until judicial review
70-25 of the decision is final; or
70-26 (C) without paying the amount of the penalty or
70-27 posting the supersedeas bond, pursue the judicial review.
71-1 (m) A person charged with a penalty who is financially
71-2 unable to comply with Subsection (l)(2) of this section is entitled
71-3 to judicial review if the person files with the court, as part of
71-4 the person's petition for judicial review, a sworn statement that
71-5 the person is unable to meet the requirements of that subsection.
71-6 (n) If the person charged does not pay the penalty and does
71-7 not pursue judicial review, the department or the attorney general
71-8 may bring an action for the collection of the penalty.
71-9 (o) Judicial review of the order of the board assessing the
71-10 penalty is subject to the substantial evidence rule and shall be
71-11 instituted by filing a petition with a Travis County district
71-12 court.
71-13 (p) If, after judicial review, the penalty is reduced or not
71-14 assessed, the director shall remit to the person charged the
71-15 appropriate amount, plus accrued interest if the penalty has been
71-16 paid, or shall execute a release of the bond if a supersedeas bond
71-17 has been posted. The accrued interest on amounts remitted by the
71-18 director under this subsection shall be paid at a rate equal to the
71-19 rate charged on loans to depository institutions by the New York
71-20 Federal Reserve Bank, and shall be paid for the period beginning on
71-21 the date that the assessed penalty is paid to the director and
71-22 ending on the date the penalty is remitted.
71-23 (q) A penalty collected under this section shall be
71-24 deposited in the state treasury to the credit of the general
71-25 revenue fund.
71-26 (r) All proceedings conducted under this section and any
71-27 review or appeal of those proceedings are subject to Chapter 2001,
72-1 Government Code.
72-2 (s) If it appears that a person is in violation of, or is
72-3 threatening to violate, any provision of the Texas Manufactured
72-4 Housing Standards Act (Article 5221f, Vernon's Texas Civil
72-5 Statutes), or a rule or order related to the administration and
72-6 enforcement of the manufactured housing program, the attorney
72-7 general or the director may institute an action for injunctive
72-8 relief to restrain the person from continuing the violation and for
72-9 civil penalties not to exceed $1,000 for each violation and not
72-10 exceeding $250,000 in the aggregate. A civil action filed under
72-11 this subsection shall be filed in district court in Travis County.
72-12 The attorney general and the director may recover reasonable
72-13 expenses incurred in obtaining injunctive relief under this
72-14 subsection, including court costs, reasonable attorney's fees,
72-15 investigative costs, witness fees, and deposition expenses.
72-16 Sec. 2306.605. ACCEPTANCE OF DONATIONS. The department may
72-17 accept gifts and grants of money or property under this chapter and
72-18 shall spend the money and use the property for the purpose for
72-19 which the donation was made, except that the expenditure of money
72-20 or use of property must promote the acceptance of HUD-Code
72-21 manufactured homes as a viable source of housing for very low, low,
72-22 and moderate income families.
72-23 SECTION 25. The following laws are repealed:
72-24 (1) Section 16, Texas Manufactured Housing Standards
72-25 Act (Article 5221f, Vernon's Texas Civil Statutes);
72-26 (2) the heading to Subchapter A, Chapter 21, Tax Code;
72-27 and
73-1 (3) Subchapter B, Chapter 21, Tax Code.
73-2 SECTION 26. (a) Effective September 1, 1995, the
73-3 administration of the Texas Manufactured Housing Standards Act
73-4 (Article 5221f, Vernon's Texas Civil Statutes) is transferred to
73-5 the Texas Department of Housing and Community Affairs. On that
73-6 date or as soon as possible thereafter, the assets, obligations,
73-7 liabilities, contracts, records, leases, equipment, and other
73-8 property used by the Texas Department of Licensing and Regulation
73-9 in the administration and enforcement of the Texas Manufactured
73-10 Housing Standards Act (Article 5221f, Vernon's Texas Civil
73-11 Statutes) shall be transferred to the Texas Department of Housing
73-12 and Community Affairs.
73-13 (b) The comptroller shall work with the Texas Department of
73-14 Housing and Community Affairs and the Texas Department of Licensing
73-15 and Regulation to apportion property and equipment that may be used
73-16 jointly by those agencies in the regulation of manufactured housing
73-17 and for the regulation of other related matters or entities. The
73-18 comptroller shall supervise and approve appropriate interagency
73-19 contracts for shared equipment and leased property to assure the
73-20 continuity of manufactured housing regulation. The comptroller
73-21 shall also coordinate the transfer of personnel from the Texas
73-22 Department of Licensing and Regulation to the Texas Department of
73-23 Housing and Community Affairs. The Texas Department of Housing and
73-24 Community Affairs shall prepare and furnish to the comptroller and
73-25 the Texas Department of Licensing and Regulation a list of those
73-26 employees requested for transfer. The number of employees
73-27 transferred on September 1, 1995, shall not exceed the number of
74-1 full-time equivalent positions engaged in the manufactured housing
74-2 program as of August 1, 1995.
74-3 SECTION 27. The rules of the Texas Department of Licensing
74-4 and Regulation relating to the administration and enforcement of
74-5 the Texas Manufactured Housing Standards Act (Article 5221f,
74-6 Vernon's Texas Civil Statutes) are continued in effect as rules of
74-7 the Texas Department of Housing and Community Affairs until amended
74-8 or repealed by that department. Each affected certificate, permit,
74-9 bond, order, security, or registration issued or regulated by the
74-10 Texas Department of Licensing and Regulation is continued in effect
74-11 as a certificate, permit, bond, order, security, or registration of
74-12 the Texas Department of Housing and Community Affairs.
74-13 SECTION 28. A complaint or investigation pending before the
74-14 Texas Department of Licensing and Regulation on August 31, 1995, is
74-15 transferred without change in status to the Texas Department of
74-16 Housing and Community Affairs on the effective date of this Act. A
74-17 contested case pending before the Texas Department of Licensing and
74-18 Regulation on August 31, 1995, is transferred to the jurisdiction
74-19 of the Texas Department of Housing and Community Affairs on the
74-20 effective date of this Act, and actions taken in the proceeding
74-21 shall be treated as if taken by that department.
74-22 SECTION 29. A reference in a law to the Texas Department of
74-23 Licensing and Regulation relating to the administration and
74-24 enforcement of the Texas Manufactured Housing Standards Act
74-25 (Article 5221f, Vernon's Texas Civil Statutes) means and is a
74-26 reference to the Texas Department of Housing and Community Affairs.
74-27 SECTION 30. (a) The repeal of Section 21.24, Tax Code, by
75-1 this Act applies only to an offense committed on or after that
75-2 date. An offense committed before the effective date of this Act
75-3 is covered by the law in effect when the offense was committed, and
75-4 the former law is continued in effect for that purpose. For
75-5 purposes of this subsection, an offense was committed before the
75-6 effective date of this Act if any element of the offense occurred
75-7 before that date.
75-8 (b) The amendment of Section 13, Texas Manufactured Housing
75-9 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), by
75-10 this Act does not invalidate or otherwise affect a surety bond or
75-11 other security on file with the Texas Department of Licensing and
75-12 Regulation on the effective date of this Act. The surety bond or
75-13 other security is considered endorsed to the manufactured
75-14 homeowners' recovery fund on that date and is subject to Section
75-15 13, as amended by this Act. A surety company and a registrant
75-16 filing other security must file a new bond or other security with
75-17 the Texas Department of Housing and Community Affairs not later
75-18 than March 1, 1996.
75-19 (c) The balance in the manufactured homeowners' recovery
75-20 fund administered by the Texas Department of Licensing and
75-21 Regulation on August 31, 1995, is transferred to the special
75-22 account created by Section 13A, Texas Manufactured Housing
75-23 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), as
75-24 amended by this Act, on the effective date of this Act.
75-25 SECTION 31. This Act takes effect September 1, 1995.
75-26 SECTION 32. The importance of this legislation and the
75-27 crowded condition of the calendars in both houses create an
76-1 emergency and an imperative public necessity that the
76-2 constitutional rule requiring bills to be read on three several
76-3 days in each house be suspended, and this rule is hereby suspended.