76R10282 E
By Telford H.B. No. 1193
Substitute the following for H.B. No. 1193:
By Ehrhardt C.S.H.B. No. 1193
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the licensing and regulation of manufactured housing.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Section 3(1), Texas Manufactured Housing
1-5 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), is
1-6 amended to read as follows:
1-7 (1) "Advertising" or "advertisement" means any
1-8 commercial message which promotes the sale, exchange, or
1-9 lease-purchase of manufactured homes and which appears in, or is
1-10 presented on, radio, television, a public-address system,
1-11 newspapers, magazines, leaflets, flyers, catalogs, direct mail
1-12 literature, other printed material, electronic media, an inside or
1-13 outside sign or window display, or in point-of-sale literature or
1-14 price tags. Materials which are educational or that may be
1-15 required by law do not constitute advertising. Any advertisement
1-16 relating to manufactured housing shall be considered as an offer to
1-17 sell, exchange, or lease-purchase to consumers.
1-18 SECTION 2. Section 4, Texas Manufactured Housing Standards
1-19 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended to
1-20 read as follows:
1-21 Sec. 4. MANUFACTURED HOUSING STANDARDS. (a) The director
1-22 shall adopt standards and requirements for the installation and for
1-23 the construction of manufactured housing, that are reasonably
1-24 necessary in order to protect the health, safety, and welfare of
2-1 the occupants and the public. The collection of these standards
2-2 and requirements is the Texas Manufactured Housing Code.
2-3 (b) [The requirements and standards for the plumbing,
2-4 heating, air-conditioning and electrical systems and construction
2-5 of manufactured homes in effect on September 1, 1989, remain in
2-6 full force and effect until amended in accordance with the
2-7 procedure set forth in this section.]
2-8 [(c)] The director shall adopt standards and requirements
2-9 for the construction of HUD-code manufactured homes in compliance
2-10 with the federal standards and requirements established under
2-11 Title VI of the Housing and Community Development Act of 1974,
2-12 entitled the National Manufactured Home Construction and Safety
2-13 Standards Act of 1974.
2-14 (c) [(d)] The director shall adopt standards and
2-15 requirements for the installation of all manufactured housing in
2-16 the state that are necessary for the protection of the health,
2-17 safety, and welfare of all the citizens. The standards must assure
2-18 that the installation of manufactured housing on both permanent and
2-19 nonpermanent foundation systems resists overturning and lateral
2-20 movement of the housing according to the design loads for the
2-21 particular wind zone for which the housing was constructed.
2-22 (d) [(e) The requirements and standards for the installation
2-23 of manufactured homes as adopted by the state in existence on
2-24 September 1, 1989, remain in force until amended in accordance with
2-25 the procedure set forth in this section.]
2-26 [(f)] All manufactured housing must be installed in
2-27 compliance with the standards, rules, regulations, or
3-1 administrative orders of the director. The department shall
3-2 establish an inspection program whereby at least 25 percent of the
3-3 manufactured homes installed are inspected on a sample basis for
3-4 compliance. The department's program shall place priority on
3-5 multi-section homes and homes installed in Wind Zone II.
3-6 (e) [(g)] A local governmental unit of this state, without
3-7 the express approval of the board following a hearing on the
3-8 matter, may not adopt different standards from those promulgated by
3-9 the director for the construction or installation of manufactured
3-10 housing within the local governmental unit. The local governmental
3-11 unit must demonstrate that the public health and safety require the
3-12 different standards.
3-13 (f) [(h)] Before the adoption or promulgation of any
3-14 standards or requirements authorized by this section, any change in
3-15 or addition to the standards authorized in this section, or the
3-16 approval of different standards by any local governmental unit, the
3-17 director shall publish a notice and conduct a public hearing under
3-18 Section 9 of this Act.
3-19 (g) [(i)] Every requirement or standard or modification,
3-20 amendment, or repeal of a requirement or standard adopted by the
3-21 director shall state the date it shall take effect as provided by
3-22 Section 9 of this Act.
3-23 (h) [(j)] The department shall cooperate with all units of
3-24 local government in this state and shall authorize local units of
3-25 government, on request, to make and perform inspection and
3-26 enforcement activities related to the construction of foundation
3-27 systems and the erection and installation of manufactured housing
4-1 at the homesite pursuant to contracts or other official
4-2 designations and the rules and regulations of the director. The
4-3 department shall notify each local governmental unit biennially in
4-4 writing to advise the local governmental unit of the program for
4-5 contracting installation inspections. The department shall
4-6 encourage local building inspection officials to perform
4-7 enforcement and inspection activities for manufactured housing
4-8 installed within the local governmental unit and may establish
4-9 cooperative inspection training programs. The department may
4-10 withdraw the authorization if the local governmental unit fails to
4-11 follow the rules, regulations, interpretations, and written
4-12 instructions of the department.
4-13 SECTION 3. Sections 6(h) and (l), Texas Manufactured Housing
4-14 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), are
4-15 amended to read as follows:
4-16 (h) It is unlawful for a person to sell, convey, or
4-17 otherwise transfer to a consumer in this state a [salvaged]
4-18 manufactured home for which a salvage title has been issued under
4-19 [as such term is defined in] Section 8 of this Act. A salvaged
4-20 manufactured home may only be sold to a licensed retailer or
4-21 licensed rebuilder.
4-22 (l) It is unlawful for a retailer or a salesperson to aid or
4-23 assist a consumer in preparing or providing false or misleading
4-24 information on a document related to the purchase or financing of a
4-25 manufactured home or for a salesperson to submit information known
4-26 to be false or misleading to a retailer or for a retailer or a
4-27 salesperson to submit information known to be false or misleading
5-1 to a credit underwriter or lending institution.
5-2 SECTION 4. Section 7, Texas Manufactured Housing Standards
5-3 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended by
5-4 amending Subsections (o) and (q) and adding Subsection (s) to read
5-5 as follows:
5-6 (o) Any person not licensed or registered with the
5-7 department or a predecessor agency as of September 1, 1987, must
5-8 attend and complete twenty (20) hours of instruction in the law and
5-9 consumer protection regulations as a prerequisite for a license.
5-10 The instruction shall be given not less than one time each quarter.
5-11 No test shall be made a prerequisite of licensing, but actual
5-12 attendance at the instruction sessions is required. The director
5-13 shall not issue a license until the instruction is completed. This
5-14 subsection does not apply to a license holder or registrant making
5-15 application to license additional business locations, to renew or
5-16 reinstate a license, or to make application for licensing as a
5-17 salesperson. In lieu of this instruction requirement, a
5-18 manufacturer may request that a one-day, in-plant training session
5-19 be presented by an authorized representative of the department.
5-20 The manufacturer shall reimburse the department for the actual
5-21 costs of the training session.
5-22 (q) In lieu of the instruction requirements imposed under
5-23 Subsection (o) of this section, the director may recognize and
5-24 approve a training program for an applicant for a license
5-25 [installers] that is conducted [in the field] by a private
5-26 institution or other person.
5-27 (s) A person who is licensed as a broker or salesperson
6-1 under The Real Estate License Act (Article 6573a, Vernon's Texas
6-2 Civil Statutes) may act as a manufactured housing broker or
6-3 salesperson and is not required to be licensed or post bond or
6-4 other security under this Act, provided negotiations for the sale,
6-5 exchange, or lease-purchase of the manufactured home are conducted
6-6 on behalf of a person for whom the real estate licensee otherwise
6-7 acts as a real estate broker or salesperson.
6-8 SECTION 5. Sections 8(b) and (g), Texas Manufactured Housing
6-9 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), are
6-10 amended to read as follows:
6-11 (b) It is unlawful for a person to sell, exchange, or
6-12 lease-purchase any used manufactured home to a consumer for use as
6-13 a dwelling or residence without giving a written warranty that the
6-14 manufactured home is habitable. The consumer has 60 days after the
6-15 date of the sale, exchange, or lease-purchase agreement to notify
6-16 the seller in writing of any defects that make the home
6-17 uninhabitable. Failure to give this required notice terminates any
6-18 obligations and liabilities of the seller under this section. The
6-19 warranty must conspicuously disclose this requirement to the
6-20 consumer. If the sale, exchange, or lease-purchase is to a
6-21 purchaser for the purchaser's business use, the manufactured home
6-22 need not be habitable; however, the title to the home shall be
6-23 surrendered to the department for cancellation by the seller.
6-24 "Business use" means any use other than for a dwelling or
6-25 residence. This subsection does not apply to a sale, exchange, or
6-26 lease-purchase from one consumer to another consumer.
6-27 (g) For the purposes of this Act, a "salvaged" manufactured
7-1 home means a manufactured home that has been scrapped, dismantled,
7-2 or destroyed or for which an insurance company has paid the full
7-3 insured value [obtained by a property and casualty insurer from the
7-4 insured by reason of the insurer's payment of the policy value
7-5 written on the home to the insured]. The reasonableness of the
7-6 insurer's judgment that the costs of repair to the home would
7-7 exceed the insured value of the home does not affect the status of
7-8 the home as salvage. The person possessing the original document
7-9 of title to a used [salvaged] manufactured home that is salvaged
7-10 must surrender such document of title to the director for
7-11 cancellation of the title and issuance of a salvage title. If a
7-12 new manufactured home becomes salvaged, the retailer must remove
7-13 the label and must surrender the label along with the
7-14 manufacturer's certificate of origin to the director for issuance
7-15 of the salvage title. If the manufactured home is rebuilt in
7-16 accordance with the provisions of this Act and the rules and
7-17 regulations of the director, the director shall issue, upon proper
7-18 application, a [new original] document of title in lieu of the
7-19 salvage title.
7-20 SECTION 6. Sections 9(e) and (g), Texas Manufactured Housing
7-21 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), are
7-22 amended to read as follows:
7-23 (e) All rules shall be promulgated and adopted in accordance
7-24 with Chapter 2001, Government Code, and with the provisions of this
7-25 section. Public and administrative hearings shall be held in
7-26 Travis County unless all parties agree to another location.
7-27 (g) A rule, amendment to a rule, or repeal of a rule as
8-1 finally adopted shall be published in the Texas Register and
8-2 include a statement of the effective date. The effective date of a
8-3 rule relating to installation standards shall be not less than 60
8-4 days following the date of publication of notice that the rule has
8-5 been adopted. All other rules are effective 30 days following the
8-6 date of publication [Any other rule is effective as provided by
8-7 Chapter 2001, Government Code, or such later date as is published].
8-8 SECTION 7. Sections 14(d), (i), and (j), Texas Manufactured
8-9 Housing Standards Act (Article 5221f, Vernon's Texas Civil
8-10 Statutes), are amended to read as follows:
8-11 (d) The retailer shall give the consumer a written warranty
8-12 that the installation of the new HUD-code manufactured home at the
8-13 initial homesite will be completed in accordance with all
8-14 standards, rules, regulations, administrative orders, and
8-15 requirements of the department and that any appliances or equipment
8-16 included with the sale of the home to be installed by the retailer
8-17 have been, or will be, installed in accordance with the
8-18 instructions or specifications of the manufacturer of the appliance
8-19 or equipment and are free from defects in materials or workmanship.
8-20 The retailer's warranty is for a period of one year from the date
8-21 of initial installation of the home at the consumer's homesite.
8-22 The retailer must give the consumer a copy, or a general
8-23 description, of the manufacturer's new home construction warranty
8-24 and the retailer's installation warranty prior to the signing of
8-25 any binding retail installment sales contract or other binding
8-26 purchase agreement. At the time of the initial installation at the
8-27 consumer's homesite, the retailer must deliver [shall deliver to
9-1 the consumer at the time the contract of sale is signed] the
9-2 following documents:
9-3 (1) the manufacturer's warranty;
9-4 (2) the retailer's warranty;
9-5 (3) the warranties for all appliances and equipment
9-6 given by the manufacturers of the appliances and equipment included
9-7 with, or installed in, the home; and
9-8 (4) the name and address of the manufacturer and
9-9 retailer to which the consumer is to give notice of warranty
9-10 service requests.
9-11 (i) After receipt of a request for a home inspection, the
9-12 department shall perform an [such] inspection within 30 [15] days.
9-13 Within 10 [five] days following the inspection, the department
9-14 shall mail a written report and orders, if any, to the consumer,
9-15 manufacturer, and retailer by certified mail, return receipt
9-16 requested. The report shall detail each of the consumer's
9-17 complaints, whether or not each complaint is covered by either of
9-18 the warranties and which warranty. The director shall issue
9-19 appropriate orders to the manufacturer or retailer for correction
9-20 or repair of the defects and the time allowed, which must be
9-21 reasonable, for the correction.
9-22 (j) The manufacturer, [and] retailer, and installer shall
9-23 comply with the initial report and warranty service orders of the
9-24 director. The department may issue an amended report and warranty
9-25 orders if all parties receive notification of and are given an
9-26 opportunity to respond to the report and warranty orders. The
9-27 amended report and warranty orders must supersede the initial
10-1 report and warranty orders [Such orders are not contested cases
10-2 within the meaning of Chapter 2001, Government Code, so as to
10-3 provide an opportunity for an adjudicative hearing prior to
10-4 compliance].
10-5 SECTION 8. Section 18, Texas Manufactured Housing Standards
10-6 Act (Article 5221f, Vernon's Texas Civil Statutes), is amended by
10-7 amending Subsections (e) and (g) and adding Subsection (j) to read
10-8 as follows:
10-9 (e) Nothing in this Act shall be construed to modify or
10-10 amend any provisions of The Real Estate License Act, as amended
10-11 (Article 6573a, Vernon's Texas Civil Statutes). The provisions of
10-12 this Act, as amended, shall not apply to a person licensed as a
10-13 real estate broker or salesperson [salesman] pursuant to The Real
10-14 Estate License Act, as amended (Article 6573a, Vernon's Texas Civil
10-15 Statutes), who, as agent of the buyer or seller, negotiates the
10-16 sale or lease of a manufactured home and the real property to which
10-17 it is affixed; provided that the ownership of the manufactured home
10-18 and real property are of record in the same person and that such
10-19 sale or lease shall be in a single real estate transaction.
10-20 (g) A local governmental unit or home-rule city may not
10-21 require any permit, fee, bond, or insurance for the transportation
10-22 and installation of manufactured housing by a licensed retailer or
10-23 installer except as may be approved by the department.
10-24 (j) A licensed retailer is a "warehouseman" as defined by
10-25 Section 7.102, Business & Commerce Code, for the storage of
10-26 manufactured homes for hire. The provisions of the Business &
10-27 Commerce Code relating to the storage of goods for hire apply to
11-1 the licensed retailer acting as a warehouseman.
11-2 SECTION 9. Section 19(g), Texas Manufactured Housing
11-3 Standards Act (Article 5221f, Vernon's Texas Civil Statutes), is
11-4 amended to read as follows:
11-5 (g) The owner designated in the original document of title
11-6 must transfer the title on a form prescribed by the director and
11-7 must file the form with the department before a manufactured home
11-8 may be conveyed, transferred, or otherwise disposed of at a
11-9 subsequent sale. The form must include any information the
11-10 director requires and must include a statement that the person
11-11 signing is the owner of the manufactured home and that there are no
11-12 liens on the home except a lien shown on the document of title. If
11-13 an original document of title is unavailable because a previous
11-14 owner or lienholder, or both, cannot be located or because a home
11-15 has been abandoned, a person may apply to the department for a
11-16 replacement title by presenting evidence satisfactory to the
11-17 department that efforts to locate the previous owner or lienholder,
11-18 or both, have been unsuccessful and an affidavit stating that to
11-19 the best of the applicant's knowledge, the applicant is entitled to
11-20 have a good and marketable title to the manufactured home. A title
11-21 to a manufactured home may not pass or vest at a subsequent sale
11-22 until the transfer is executed as provided by this section and an
11-23 application for the issuance of a new document of title is sent to
11-24 the department.
11-25 SECTION 10. The importance of this legislation and the
11-26 crowded condition of the calendars in both houses create an
11-27 emergency and an imperative public necessity that the
12-1 constitutional rule requiring bills to be read on three several
12-2 days in each house be suspended, and this rule is hereby suspended,
12-3 and that this Act take effect and be in force from and after its
12-4 passage, and it is so enacted.