Monday, February 22, 2010

Moms and Pops of America-Standing Up and Silent No More!

This is an excerpt from my blog post from a few months ago. It was a letter of thanks I wrote to a professor of law in Tucson whose research study on the effects of this mortgage crisis on seniors was given press by a Los Angeles journalist. Seniors in dead end mortgages need not continue paying their mortgage payments if it means losing their lives or life savings.

The data contained in this entry is very informative and provides great insight as to the socio-economic aspects of this very special group and their affects on Arizona's economy.

Moms and Pops of America is a not-for profit organization I founded and for which I am the registered lobbyist. We represent a voice to state legislature for the benefit of seniors and small business in Arizona. Please click this link to hear the testimony given which helped to gain unanimous support for SB1146-Park Models Right to Sell. I drafted SB1146 which is a private property rights bill related to the "park model" retirement land lease housing industry in Arizona.

This legislation, if passed will give snowbirds and other seniors in Arizona the support in statute they desperately need in order to have a right to sell (dispose) their properties when rather that being forced often by necessity to turn their titles and Constitutional rights to the land owner. Currently many seniors suffer silently because of the abuse the lack of this legislation has allowed to happen.

This bill was passed (unanimously) through the Arizona State Senate Commerce Committee on 2/16/2010.

How this is important to tea party members is that the underlying concept behind this bill relates to the 14th Principle as presented in the 5000 Year Leap, p.169; "Life and Liberty are Secure Only so Long as the Right to Property is Secure". Up to this point a lack of consumer representation in legislature has allowed for despotism in senior communities which has resulted in the loss of our rights in property and the loss of the properties themselves. In addition, first Amendments rights are violated because residents may lose their homes if they resist unconscionable rules created by the land owner.

We need support NOW from voters in Arizona who are willing to let legislatures know that they will be held accountable to support our Constitutional rights in Arizona even if those whose rights are being violated are not registered voters in Arizona.

Here it is:
Over twenty years ago, I became involved with the winter visitor industry through a part time job when I came to Arizona to go to college. In 1994 I founded a unique organization that specifically catered to the needs of the 55+ retirement and vacation housing market in Arizona. I became involved with many of the entry point organizations in Arizona such as the Chambers of Commerce, Office of Tourism, BBB and my company has served as a resource for centralized information about these types of communities. Although, I cringe at our declining home values (and do everything in my power to sell homes), I am so grateful for our senior market or I wouldn't be in this business.

I believe in Arizona and love it here and want to see our economy thrive but , as God fearing United States citizens, there are lines we must learn not to cross. Over the years I have struggled to survive as a small business owner; up against the corporate giants in our industry who abuse seniors, monopolize the marketplace and blatantly violate federal anti-trust laws with no consequence. (See my blog article; Consumer Rights by Community Type).

Even though there are several well managed communities in this industry whose owners still have a "heart toward seniors", they are becoming more obsolete due to the bottom line tactics of money changer, depreciation seeking, safe harbor investors and other out of state corporations that control the lobby power and laws in Arizona.Since the beginning of this last year, I have personally come in contact with dozens of retirees who are struggling with the very issues you presented in your article.The evolution and expansion of the senior housing market in Arizona has stemmed widely from the influx of out of state retirees over the last few decades.

A large percentage of our states residents and registered voters initially began their adventures to Arizona as seasonal guests (Snowbirds), but ended up here on a permanent basis even if though many still take their RV's to Minnesota in the summertime. These "visitors" have brought billions of dollars to our state in sales tax and property taxes for homes they own even if it's not affixed to the land. Even though the vacation and retirement housing industry is appealing to those with an ability to have a second home, it also can serve as an affordable housing option for those on fixed incomes.

One gentleman bought a park model with his wife when they first retired but when she died he came here permanently to have the fellowship he found in the 55+ community.Retirees who relocate here may start off with a "park model/RV" or manufactured home in a "leased land" community and then invest in various types of real estate for permanent residences. Since I have worked with retirees from these various segments of the retirement industry, my entire adult life over the last two decades, I would like to share a deeper perspective supporting the issues you touched upon in the article.

I stand in reverence toward our seniors and am so grateful I have had the honor and unique experience of hearing the life stories of thousands of retirees, veterans and others who frequent our state from all over the United States and Canada. In 1994 I started the first property management company which specializes in locating and managing this specific type of housing in the 55+ Active Retirement Communities. I later became a park model and manufactured housing broker specializing in resales of existing "winter homes". I am also now a licensed Arizona Realtor®, and am now able to facilitate the entire spectrum within this specific market.

In 2004 I was contracted as a research specialist and consultant for a very large Chicago based corporation with land lease community holdings throughout the United States. The research project resulted in a special meeting and presentation for their investors and corporate officers. This corporation wanted to position itself to capture the up and coming "baby boomer' market which would "phase out" the older generation in the years to come. This engagement resulted in my being flown to Florida to present an independent low budget film I produced and an article later published and featured in a national senior housing magazine in 2006 entitled: "What the bleep do boomers want'?

In my efforts to determine the buying trends of boomers compared to the prior generations for this commission, I embarked on an amazing adventure into the psyches of seniors and interviewed dozens of retirees and included the perspectives from a few of those directly involved with this specialized market including Jay Butler, Director of Realty Studies at Arizona State University (please see his most recent findings). The experience of this project gave me an even more intimate understanding of the social dynamic and motivations of retirees which could be understood a little better and I was able to cross reference predictable market behavior by understanding the various generations and demographics.

As I studied and researched the historic socio-economic-cultural mindset dynamic and market triggers it was also made clear to me many of the core issues our seniors must now face to survive and exalt themselves from the mucky water. Specifically these include overcoming shame, fear of shame, religious belief systems, attitudes of entitlement, feelings of helplessness and learning the difference between personal responsibility and co-dependent relationships with authority figures. They must now pray for the willingness to stand up for themselves and find power in numbers, instead of bowing out of the responsibility they must take for their own lives.

One of my clients lives in a small manufactured home on a "little piece of heaven" in Apache Junction, she and her husband purchased before he passed away. She couldn't live in a 55+ community because she has chosen to raise her grandson whose mother died of a drug overdose. She said she couldn't understand why two of her children were so successful while the other one became another statistic of the disease of addiction. I explained to her during our first meeting that I was working on a amateur documentary about our nations snowbirds and asked her if she would be willing to share her perspective on where our country stood.

Her thoughtful reply was; "I feel like where our generation went wrong was trying to provide too much to our children (the boomers-italics mine) so they wouldn't have to do without like we did". As we continued in our conversation she wistfully recollected and shared what she remembered as a little girl around the time of the Great Depression. Her family became farmers to survive and provide for themselves. She explained how staples were rationed and stamps were traded for shoes. She said she feels like their generation "helped to create the current problems by giving their children what it took lifetimes for them accumulate". Further she admitted; "We made it too easy for them, and now they feel entitled to it'". I will most likely be forced to work with a cash buyer or investor for her property because land home financing is now almost non-existent.

My "Baby Boomer Research Project" of 2004 resulted in the identification of three specific "generational "groups/sets which the latter I was able to further identify by subsets. The three groups include; the Bob Hope Generation (Depression Era), SED Generation (Sinatra, Elvis, James Dean) and Baby Boomers. You might be interested in some of the findings outlined in this article. Currently, I am a personal witness to massive amounts of evidence that support many of the points you made in the article that could pose an even more serious threat to our seniors that we realize.Certain sects of retirees, depending on their upbringing, social norms, family values, memory and internalization levels of shame associated with their parents struggles during the Great Depression, are the ones who seem to be suffering the most.

They struggle with so much shame and guilt it is horrifying to watch. I find myself wearing many hats these days including that of a life coach/housing-grief counselor for so many seeking "permission" to move on as they struggle with their image of themselves as "bad stewards", taking on the responsibility of the current housing crisis.As I speak with them, it appears that even if they realize that they are not the ones who caused it, they still believe that they should "weather out the storm" and "take care of their business" all the while their retirement savings accounts dwindle away.

Many buy into the bullshit that it would be morally wrong to take care of themselves and instead believe that doing so would be contributing to the demise of their neighbors home values.Specifically, many of this group are retired farmers or other "lay people" that spent their time planting and harvesting, spending time with their families, working so hard to save up to pay for college and retirement that they had always hired "professionals" to take care of their financial affairs. It seems they haven't been able to process through the harsh reality that in many cases they are trading their financial futures for no chance of recouping their lost equity while they are still alive.Not only are they stressed out, they are also completely disoriented because they never dreamed they would be losing their retirement nest eggs, pensions, 401K's and homes!

These retired veterans, farmers, postal workers, teachers and so many others in this generation remain silent because they were taught not to burden others with their problems. By not sharing their pain, the shame and isolation they experience results in so much stress and constant worry that many now take anti-depressants or anti-anxiety medication. For example, last year, I came in contact with a retired GM worker that while GM was deciding whether or not to file bankruptcy, he could not even get out of bed for weeks as he suffered from depression that bordered suicidal tendencies.Others have taken their own lives.We have a moral and ethical responsibility to do something about this atrocity. We have an obligation to provide to them what they have given to America their whole lives. We must be good shepherd with our seniors. They need us more than ever.. What I am witnessing angers and saddens me beyond words because there is such an evil criminal element to what is happening.

These are the ones who fought our wars, modeled family and fellowship values, volunteered and continue to be used as the scape goat to shoulder the brunt of greed and corruption. These are the ones who only paid cash for what they bought, never over extended on credit or bought things they "couldn't afford". In fact, one couple paid cash for the house they purchased in Arizona but then later refinanced to extract enough money to hand over to medical providers to cover the the discrepancy in cost between what was "covered" by their health insurance for an open heart surgery and what was billed by the various providers and institutions involved. Fortunately for them, they had a wise attorney adviser who encouraged them to file bankruptcy before they lost their livelihood completely.The responsible retirees in our country may not be the reason we are in this economic mess but they are still the ones being used by government powers to manipulate the marketplace.

I feel an obligation to assist these folks by using my creative thinking skills to develop emotional support networks and opportunities to understand the larger "ugly" picture of things and not feel responsible for it.Even though seniors are a fast growing group utilizing the Internet as an information source, there are still countless people in the older generation who are not computer or Internet savvy and don't really want to be. They may lack digital exposure to free speech and freedom of the press as so much is automated these days. They may not have access to personal Blogs or other research findings that are not yet completely under control by government and wall street. They need face to face contact!Now, as we witness the speedy money printing press at work, the eventual interest rate hikes, additional job losses, transfers and nearing 5 and 7 Year Adjustable Rate Mortgage (ARM) expiration's will surely spur even more defaults in higher risk "sub-prime" neighborhoods where risky loans were sold between 2002 and 2006.

Rental property supply is on the increase and transient residency will follow. Investment companies are so eager to fill their new found short sale and REO acquisitions with warm bodies, they often market specifically to felons and those with bad credit willing to pay a higher rental rate and who probably do not share the older generations value system and pride of ownership. (At least in most manufactured housing communities, there is a criminal background check requirement).

As a Realtor and ex-loan officer wading my way through the short sale and REO swampy landscape, I find myself interviewing every agent and broker with whom I come in contact to gauge the marketplace from their point of view. One of the investment brokerage firms I spoke with yesterday told me that cash investors are beating out legitimate FHA qualified buyers with LS R's and proof of funds for short sales and foreclosures due to their "30% greater chance for closing" even if the cash buyer is offering 20K less for the same property! There is no doubt, this will further increase the supply of available rentals, lessen the supply of lower income properties available for primary residency we need to build relationship longevity in our communties to help them feel safe and build confidence in the market.

I am currently assisting in the formation of a private housing industry organization through a grass roots effort. The group of people that will make up this organization will consists of members that represent small business, retirement community residents, community owners, health and wellness professionals, educators, and professionals from within the estate planning, finance and real estate industries with solid and verifiable levels of integrity.We are combining efforts with the non-Partison Tea Party groups to begin the process of education and empowerment for our seniors as well as other Arizona residents. We do not need to wait for authorized non-profit groups or government endorsed entities/agencies to do this for us..

We need to take responsibility for our own communities NOW! My opinion is that the real estate and investment markets are being manipulated and controlled by greedy criminal bankers involved with the Bilderburg Group, Council on Foreign Relations (CFR) and Federal Reserve. Many people don't even realize that the Federal Reserve is a private entity controlling the market with their finger on the interest rate button and that they are not accountable to anyone. A couple of months ago, President Obama announced that he was putting the Federal Reserve in charge of the oversight of Wall Street. What a joke!Consumers are being controlled because they have been conditioned to believe what they read and see in media. Many seniors are dependent on Social Security and Medicare to survive so they want to believe in the ones giving them their handout. They have been taught to think the best in people and to be trustworthy. Fascism and oligarchy have taken over in the guise of "Free Market" and Capitalism. Limited education and awareness about the whole intricate dynamic of corruption that currently exists is tragic.

They believe and want to pass on the message that says; things are getting better, just hold on. Since I work in the 55+ land lease industry and offer affordable housing options to Arizona residents and out of state retirees, I am seeing a buying trend of exactly what you have indicated as presented in this article. I have made special provisions within the residency and qualification process required by most of the communities where relationships with decision makers serve to maintain a personal override mechanism to qualify seniors seeking residency "approval" in a 55+ land lease community on a case by case basis. By maintaining a more personal approach, managers can decide to make allowances for those with lower credit scores taking into consideration their historical payment history rather than declining their application because a mindless software program "kicked them" out and disqualified them due to internal red flag mechanisms built into the programming triggered by certain items being detected in various field of their credit reports.

So much of the waste and bureaucracy happens because we count on machines to do for us what we should be doing for ourselves and each other. We need to override the robotic systems now in place that are being given the control to steer destinies of thousands of hard working or retired responsible Americans.

I am a citizen of Gilbert, AZ and a member of the Gilbert Tea Party movement. We are working together to find creative means by which to educate and empower our communities in Arizona through "privatized" community based programs, lectures and workshops. Our next speaker meeting will be held on January 26, 2010. Stay tuned to my blog for updates on location as the Tea Party group has gotten too big for it's previous venue so efforts are being made for a assembly hall with greater capacity. The upcoming speakers include other Arizona residents and pioneers who care about preserving life, liberty and the pursuit of happiness. One of our feature speakers is State Senator John Huppenthal who has helped to pass the most massive legislation protecting Second Amendment Rights and Choice in Education. I will be supporting Senator John Huppenthal for Superintendent of Public Instruction in the next election. I am currently collecting "Clean Election Forms" and $5 contributions and a petition to get his name on the ballot. Our January topic will include; Choice, Safety and Responsibility in Education.

We will also be presenting another guest speaker that same night; Holly Craw who is a leader in the home school movement and is beginning a monthly homeschooling orientation workshop for those interested in exploring that option. Kim Grady, the State Coordinator for the Second Amendment Sisters will also be presenting information about an initiative to improve gun safety and education in schools. A cooperative effort has been formed between the Second Amendment Sisters, the Arizona Civil Defence League , Rob Potter, certified instructor by NRA and founder of Shoot Right to draft and get sponsorship to amend existing legislation to improve standards, access and experiential learning at it relates to safety and education.

By combining and coordinating our efforts within various segments of industry, neighborhood by neighborhood, we can create a support network for our communities, utilizing our local schools and churches as meeting halls. Outreach committes can be formed to locate higher risk individuals and neighborhoods, which often include seniors and/or single parents who are getting lost in the shuffle. By utilizing a precinct model (Thanks GOP), subdivision captains will serve to direct and coordinate efforts within a 1-3 mile radius of where these workshops will be held.

We must act quickly to facilitate these resources to at risk neighborhoods designed to empower the general public by encouraging personal responsibility in it's truest sense. The seminars will be offered free of charge and will include a critical support group element for sharing and emotional nurturing. Initial outreach will be to the senior age groups but available to all. I know the time has come to help the "silent generation" and those in the "age of conformity" stand up and speak up. It is my personal opinion that they are the ones at greatest risk for mental and physical disorders associated with this obscure covert form of domestic violence and elder abuse. I would be so grateful to collaborate with you on any ideas you might have to facilitate this project and/or present you as a guest speaker at one of our meetings.

The TEA party meetings are currently being held every Tuesday. The group e-mailing list is now over 700 and attendance nears 150 per meeting, mostly seniors. (Go figure)! Please take a minute to read the additional issues seniors face in Arizona in the blog entry titled: Consumer Rights by Community Type. I am advocating for equal rights for seniors who own "personal property" homes in "private property" retirement communities in Arizona.I need help to help to draft and pass an amendment to a bill which flew through our legislature in 1998 (with lobby help-SB1261) now an Arizona Revised Statutes; Title 33 Ch. 19 which enables discrimination against retirees constitutional rights in many of the 55+ land lease communities in Arizona. In the meantime, we'll teach them fire arm safety and marksmanship!

Update on February 22, 2010: SB1146 did pass through committee on 2/16/2010. It will be heard by the Rules Committee on 2/22/2010. Please join us to support this bill and our Constitutional freedom in Arizona. The first meeting of Moms and Pops of America will be on 2/22/2010 at 10am at 215 N. Robson Mesa, AZ 85201.

Wednesday, February 17, 2010

United We Stand for the Prinicipals of Freedom SB1146 Park Models-Right to Sell

God is Good. Thank you for everyones ecouragement! On Tuesday February 16, 2010, the Senate Commerce Committee voted unanimously to pass through their committee, SB1146, a striker bill amendment; Park Models - Right to Sell provided by Senator John Huppental and Senator Barbara Leff. This bill will modify definitions and rules contained within the Long Term Space Rental Act (RV Act) of 1999. This amendment to the act in the form of SB1146 will be discussed in Caucus next week, then hopefully on to the Senate Floor and over to the House Commerce Committee to go through the process again.

As I walked up to the Senate building, I carried more notebooks, papers and copies of testimonies that I probably needed but I wanted to be prepared. I had brought the City Code Research, testimonies and letters I had received from residents, experts in the industry including the banking, appraisal and transort industies. Earl walked beside me while my son Matt trailed a bit behind as our official videographer.

We made our way across the parking lot, sidewalk and streets and walked into the Senate Building to the kiosk machines that register those who wish to speak in a hearing. You can select whether you are in support, apposed or nuetral and may indicate if you want to speak. After Earl and I logged in, we were directed to the Senate Hearing room as the pages, interns and secretaries prepared for the bills and roll call. We all sat down and got confortable and waited for our turn.

As I was sitting there next to all my piles of papers and notes, I prayed for ordert to my thoughts. I knew so much about what I was going to testify about, my fear was they I might share too much or too long. Earl wrote his points on his right hand. We discussed the purpose of this bill and that even though there are so many issues related to what wrong in the RV Act, the focus was going to be on the right to sell that is on the table.

As we waited all the legislators began to come into the hearing room along with others who either represented other bills or were there to appose or support that hearing. I had no idea who was going to be there to possible appose us. As we continued to wait my mind reflected back to just about an hour before to the dear couple who drove 30 miles just to get their testimony in my hand and notarized to to give me one that another friend of there's had given to support the bill.

It was so important to get everyone who is willing to share a story, to the table and speak up. One lady I was sure would testify decided to back out at the last minute out of fear for possible remifications which she felt could come from it.
I have driven hundreds of miles and delivered hundreds of copies of notices to dozens of businesses throughout Mesa and Apache Junction. The only organization which refused to help was Wal-Mart. That was kind of ironic I thought.

I had gotten anonymous calls and e-mails from those who were curious if the legislation had gone through the week before on February 9. 2010, the original day it was on the Senate Agenda. I was too sick and asked for it to be posponed for this week and it all worked out okay.

When it was my turn Madame Senator called my name; We will now hear Senate Bill number 1146, Kara Holt? I walked up to the podium and addressed the Senator, thanked her for sponsoring and hearing the bill, introduced myself and began.

Tomorrow, I will blog mine and Earls testimony and post a link to the azleg website. I'm glad we taped our own because the leg website seems to be having technical errors and so I was not able to overview the testimony from yesterday. Hopefully that will get fixed but if not, I will post our video on You Tube soon.
One of the Senators who voted for this to pass mentioned in his closing statement that he is sure some private property rights issues will come up. That should be interested. I wonder if a community which acts as a public accomodation could actually convince a superior or supreme court that the corporations rights were to be held in higher regard than and actual persons civil liberties.

According the an excerpt of the 5000 Year Leap p.172 Justice George Sutherland of the US Supreme Court once told the New York State Bar Association: It is not the right of property which is protected, but the right to property. Property, per se, has no rights; but the individual-the man- has three great rights, equally sacred from the arbitrary interference; the right to his LIFE, the right to his LIBERTY, the right to his PROPERTY...The three rights are so bound together as to be essentially one right. To give a man his life but deny him his libert, is to take from him all that makes his life worth living. To give him his liberty but take from him the property which is the fruit and badge of his liberty, is to still leave him a slave. (Principal or Expedient? Annual Address to the New York State Bar Association, 21 January 1921, p.18)

We have the green light and we have the support of Moms and Pops of America. I am designing a flyer and some other items to get out so others can get involved. I am working on that this weekend and will be ready to meet with everyone by Monday.

We will be meeting on Monday morning at my office located in the Phillip Austin Law Firm located at 215 N. Robson in downtown Mesa, just accross the street from the Mesa Police Department on the N/E side of Robson and 2nd St. There is a coffee shop within walking distance, so if we need more space we can all go over there. We will meet at 10am on February 22, 2010.

Please call to confirm you will be there. This legislation is so important because it will give so much more freedom to thousands of retirees who have not been able to stand up for themselves or even hava leg to stand on. We are the leg someone may need to stand up on. We are the hand that someone needs to reach out to hold, we are the voice of the one who forgot how to use theirs or didn't know they had one.
We are the Moms and Pops of America. Call 480-299-7236 or e-mail:

Sunday, February 14, 2010

HB2473 She'll be comin' down the mountain' when she comes...

On Wednesday, February 10, 2010, the House Commerce Committee unanimously voted in favor of a "Do Pass" nomination by the HB2473 bill sponsor, Michele Reagan. It was noted by the sponsor that the regulatory control model associated with manufactured housing transactions was probably way past due and that despite those opposing the legislation, that HB2473 will be passing through the regular channels to become law.

My testimony in opposition to this bill seemed to help emphasize the need for an industry consensus of future amendments to the drafted legislation as it makes its way through the committee channels. It was agreed that an industry wide task force be formed to prepare a way for consequences of this bills passing. Debra Blake, the Deputy Director for the Department of Building Life and Fire Safety is spearheading this committee and has appointed individuals to form this task force group representative of the various factions of the industry it will affect. These include representatives of AAMHO, MHCA, AHA and yours truly; Moms and Pops of America.

It seems that MHCA disagrees that their interest was not fully represented in the "consensus" between all parties before the presentation to the House Commerce Committee, and the final language of the bill remains to be seen. Still some very important questions remain. If the "Department" should be dismantled, who assumes the duties of the Director and Deputy Director who serve as the only balance of power of the Board of Manufactured Housing? I understand that the "five year" rules audit DEFLS's continued existence relies upon the approval of the governor and addressed in a "Sunset Review" forum coming in 2011?

Becoming educated about the legislative process and active industry involvement are now necessary for small businesses as we face this tipping point in Arizona's economy. We need not sit by and hope that the big guys are going to get it handled for us. We must take responsibility for our own segment of the housing industry and be bold in our display of concern and contribution. New ideas and perspectives must be considered while tried and true business practices respected.

During these winds of change, perhaps smaller, more focused organizations are now the solution to find practical solutions for the inevitable unknowns such shifts of power will bring upon us. It has been suggested that the resale dealers simply renew their memberships with AHA and hope for council to represent their interests with equal levity to those of AHA's other longstanding members base? Whose interests will be represented when the time arises that a factions of resale brokers sentiments compete with those of it manufacturers or retailers? Who will take the back seat or be forced to concede their position? What protocol or bylaw within this organization addresses this possible conflict of interest?

Besides legislative agenda items, resale brokers who unify now can begin to form a consensus to form a uniform transactional model specific to the manufactured housing industry. Agenda items could include the creating of a streamline transactional process to coordinate elements of real estate transactions such as seller disclosure requirements (which items in most of these aforementioned examples are not currently statute)disclosure of community rules and leases (similar to CC& R's in real estate), agency, and comparable home evaluations "Comps".

Considering the current demand for affordable housing, the manufactured housing industry in Arizona should now flourish. Manufactured homes are now a better option than ever for those needing to downsize from their upside down positions in "stick built" residential real estate and maintain an attractive position for second home "vacation housing" ownership for our seasonal visitors.

By careful consideration of regulatory models, implementing industry cooperation forums and a fair checks and balances for power structures, Arizona can be a leader and promoter of the affordable housing industry by assuring its consumer base the discretion of responsible law making and streamline transactional processes.

Friday, February 5, 2010

HB2473 - Slam Dunk Legislation poses devastating "unintended consequences".

Friday, February 5, 2010

Scheduled for hearing by the House Commerce Committee February 10, 2010 at 9:00am

HB2473 includes drastic measures which if adopted into statute will significantly alter the transactional process, structure of enforcement and nearly eliminate consumer protection by an existing government agency in the Arizona manufactured housing industry. Bills like these which, by their passing actually alter the power structure of a governing body and standard transactional practices of hundreds of industry related organizations thereby impacting an industry's economic system, must be scrutinized very carefully by legislature to safeguard devastating "unintended consequences".

HB2473 was primarily drafted by members of three "special interest" associations; the Arizona Housing Association (AHA), Manufactured Housing Communities Association (MHCA) and Arizona Association of Manufactured Housing and RV Owners (AAMHO). AHA and MHCA are privately held statewide trade associations and are comprised primarily of land owners, manufacturers, installers and retailers of new manufactured homes; not residents of manufactured housing communities or brokers of resale homes existing in communities which represents a huge segment of "stakeholders" who would be affected by this legislation.

The Arizona Association of Manufactured Home and RV Owners (AAMHO) claims to be advocates for residents of land lease communities (a lobby for the little guy) in Arizona. During the negotiations it held with the leaders of the other AHA and MHCA and its lobbyists, it failed to notify and collect valuable input from the majority of its membership who will undoubtedly be affected by the legislation to which it is "conceding". Since AAMHO's members represents two of the 9 board members on the Board of Manufactured Housing, they may be assured through their cooperation with AHA and MHCA (who also members who serve on the Board of Manufactured Housing) of their continued presence (and job) in the industry as loss mitigaters will be allowed to continue conducting the mandated park manager education classes, which up to this point have been funded by grants associated with the interest from the consumer Recovery Fund.

The original verbiage of the bill as you see below indicates the delayed repeal (future elimination) of 41-2188 through 41-2192 which provides for the consumer Recovery Fund and Administrative Law process; the consumer’s main avenue toward relief from loss without costly litigation.

In the minutes of the Government Relations & Zoning Committee meeting held by the Arizona Housing Association (AHA) on June 23, 2009 the AHA discussed it's concern and plans to deal with various issues including permits and installation inspection delays, DFBLS/OMH, the Recovery Fund and the Board of Manufactured Housing. Streamlining the scope of installation contractors licenses through the Registrar of Contractors instead of DFBLS, creating escrow account requirements for all dealers/brokers would eliminate the need for dealer trust accounts and the consumer recovery fund and AHA would assert it's influence by utilizing it's position by it's members majority seating on the Board of Manufactured Housing.

It was discussed that there was talk of "breaking up the agency" (meaning DFBLS) and that OMH would become a "stand alone" agency or join the Department of Housing or Registrar of Contractors. It was also announced in this meeting that two additional AHA members, Sam Baird and Joe Stegmeyer had been appointed to the Board of Manufactured Housing to join it's other existing AHA and Board of Manufactured Housing members; Roger Wendt, Paul DeSanctis, Ken Anderson & Ross Waite. With the help of AAMHO and other "partners" to obtain an industry "buy-in" which they acknowledged "could be difficult", they would draft language for the amending language, find a sponsor and get the bill proposed by the January deadline for the next legislative session.

It is my position that an escrow account requirement for retailers/brokers may be the most realistic alternative to trust accounts; especially if the governing agency responsible for auditing is soon to find its last paycheck. There needs to be some type of governing board by which rules and standards are overseen, adopted and enforced but my concerns remain as follows:

1. Who represents the balance of power to oversees the activates of the Board of Manufactured Housing and their establishment and adoption of rules and standards? To whom is the "Board" accountable?

2. What process insures that the Board is truly representative of the public?

3. If the current enforcement agency DFBLS is dismantled, who is the next in charge to enforce the standards and rules and how will they be paid?

4. Since these are appointed positions and there are no term limits how do vacancies become available for others to serve a positions on this board?

5. AAMHO has served as a liaison between tenant and management to serve as a loss mitigation function for community ownership. AAMHO is paid to provide classes to managers to educate them about the LTA and tenant relations. AAMHO is not proficient in the transactional processes of dealers and do not represent a resale dealer or the resale transactions of a tenant residing in a manufactured housing community and therefor are not qualified to negotiate legislation which affects transactional processes or serve on the "Board" in such capacity where rules may be voted upon and adopted from this limited and inexperienced perspective.

6. Many residents and resale brokers are at a disadvantage when competing against a community owned new or resale "sales agency". It is standard knowledge within the resale industry, that this unfair playing field is taken advantage of by salespersons (often wearing two hats also as a community manager) who make exceptions for rules and guidelines for their buyers but which same consideration is not offered to the individual resident who chooses to sell on his own or hire and outside "competitive" sales agency.

7. Will the drafters of this legislation obtain an unfair advantage by a rule of law for the members of their other special interest trade associations they also serve? Should these drafters also hold position as rule makers and enforcers?

8. If all stake holders had been represented in the negotiations of the drafting of this bill, then these items could have been addressed and negotiated via an industry task force so a true consensus could be reached rather than addressed at a house committee level.

9. Who truly will represent the voice the people and small business; the Moms and Pops of America? Please call Kara Holt, lobbyist for Moms and Pops of America.


Please visit to learn the history of a bill which has cause harmful "unintended consequences".

Please visit to preview SB1146 (Park Models-Right to Sell). If adopted into law this bill will amend ARS 33-2132 with language which provides for consumer rights which have been violated by legal loop hole technicians for over a decade causing much harm and suffering to our seniors.

Here is the most recent draft of HB2473:

Proposed Amendment to HB 2473- Reference House Introduced Version
Explanation: We are revising the bill to call for escrow on all new transactions and on transactions for used home sales that are in excess of $50k. For used home sales transactions that are less than $50k will continue to use the recovery fund, unless the buyer requests the use of an escrow.

Page 1, 41-2180 should read:
(Note: we’re referencing title 6 and 20 since those are the financial institution statutes)
We need to add a definition of independent financial institution or escrow agent.
Page 1, 41-2180 B should read:
A. B. Each dealer or broker who is licensed pursuant to this article and who sells manufactured homes, mobile homes or factory built buildings designed for use as residential dwellings shall maintain a trust account or an escrow account with a financial institution or escrow agent located in this state and shall deposit all earnest money received for the sale of manufactured homes, mobile homes or factory built buildings designed for use as residential dwellings in such account. The department shall conduct an audit of each dealer's or broker's trust or escrow account at least once every two years. BEGINNING JULY 1, 2011, THIS SUBSECTION APPLIES TO THE SALE OF A PREVIOUSLY OWNED MANUFACTURED HOME, MOBILE HOME OR FACTORY BUILT BUILDING DESIGNED FOR USE AS A RESIDENTIAL DWELLING WITH A PURCHASE PRICE THAT DOES NOT EXCEED FIFTY THOUSAND DOLLARS. BEGINNING JULY 1, 2011, A HOME PURCHASER UNDER THIS SUBSECTION MAY REQUEST THAT THE DEALER OR BROKER ESTABLISH AN INDEPENDENT ESCROW ACCOUNT IN WHICH CASE THE DEALER OR BROKER MAY SHALL COMPLY WITH THIS SUBSECTION BY COMPLYING WITH SUBSECTION A OF THIS SECTION.

Page 3, new section O:
Add the following section changes :

41-2189. Funding and assessments
A. A dealer or broker of manufactured homes, mobile homes or factory-built buildings designed for use as residential dwellings shall pay, in addition to the license or renewal fee, a fee established by the board of not to exceed thirty dollars for each unit sold PURSUANT TO 41-2180 B, for deposit into the consumer recovery fund. The fee is payable to the office by the fifteenth day of the month following the month in which the sale is consummated.
B. If the balance remaining in the consumer recovery fund is less than two hundred thousand dollars, a dealer or broker of manufactured homes, mobile homes or factory-built buildings designed for use as residential units shall, when renewing a license for the following calendar year, pay in addition to the renewal fee a fee of not to exceed fifty dollars for deposit into the fund. If the balance in the consumer recovery fund exceeds four hundred thousand dollars, the board may relieve licensees of the per unit fee.
C. Chapter 6 of this title does not apply to the setting of fees under this section.
D. An amount not to exceed seventy-five per cent of the previous fiscal year's interest earned on the consumer recovery fund may be expended by the director, with the approval of the board. The expenditure shall be used for consumer and licensee education in connection with the manufactured housing and factory-built building industry, and all monies up to a maximum of fifty thousand dollars remaining unexpended and unencumbered at the end of each fiscal year may be used for consumer and licensee education in succeeding fiscal years and do not revert to the consumer recovery fund.

41-2190. Recovery from fund; claim against licensee; subrogation; appeal; statute of limitations
A. If any A consumer who is buying or selling the consumer's home SUBJECT TO THE PROVISIONS IN 41-2180 B uses the services of a licensed dealer or broker of manufactured homes, mobile homes or factory-built buildings designed for use as residential buildings and is damaged as a result of an act or omission by a licensed dealer or broker of manufactured homes, mobile homes or factory-built buildings designed for use as residential buildings which constitutes a violation of section 41-2180, or rules adopted pursuant to that section, that consumer may file a claim with the office for payment from the consumer recovery fund. The claim shall be verified by the office.
B. If any A consumer who is buying or selling the consumer's home SUBJECT TO THE PROVISIONS IN 41-2180 B If any consumer of manufactured homes, mobile homes or factory-built buildings designed for use as residential buildings is damaged by the failure of the principal to perform a sales agreement or to perform repairs under a warranty, the consumer may file a claim with the office for payment from the consumer recovery fund. The claim shall be verified by the office.
C. Upon verification of the claim for payment, the deputy director shall provide for a hearing pursuant to chapter 6, article 10 of this title.
D. The board shall pay from the consumer recovery fund whatever sum the administrative law judge finds payable upon the claim. A decision granting a claim shall include an order suspending the license of the licensee upon whose account the claim was filed. Such a license shall remain on suspension until the licensee has repaid in full, plus interest at the rate of ten per cent per year, the amount paid from the consumer recovery fund on the licensee's account.
E. Any party aggrieved by the administrative law judge's decision may apply for a rehearing by filing with the deputy director a motion in writing pursuant to chapter 6, article 10 of this title. The filing of a motion for rehearing shall suspend the operation of the administrative law judge's order pending the decision of the director upon the rehearing.
F. Except as provided in section 41-1092.08, subsection H, any person aggrieved by a final administrative decision may seek judicial review pursuant to title 12, chapter 7, article 6.
G. The consumer recovery fund has a claim against the licensee on whose account a claim was granted, OR ANY OTHER PERSON WHO CAUSED OR CONTRIBUTED TO A CLAIM PAID BY THE RECOVERY FUND for the amount paid plus costs, necessary expenses and reasonable attorney fees.
H. The deputy director is subrogated to the claim of the consumer recovery fund against the bond and other assets of the licensee. The deputy director shall deposit any amount recovered into the consumer recovery fund.
I. If, at any time, the money deposited in the consumer recovery fund is insufficient to satisfy any duly authorized claim or portion of a claim, the board shall, when sufficient money has been deposited in the consumer recovery fund, satisfy such unpaid claims or portions of claims in the order that such claims or portions of claims were originally filed.
J. A consumer pursuant to subsection A or B of this section is barred from commencing an application for payment from the consumer recovery fund later than two years from the date of sale or date of installation, whichever is later.