DR. BEN CARSON

SECRETARY OF HOUSING AND URBAN DEVELOPMENT

MANUFACTURING HOUSING INSTITUTE 2018 CONGRESS AND EXPO

LAS VEGAS, ​APRIL 25, 2018

TITLE: A NEW ERA OF COOPERATION AND COORDINATION

Introduction

Good morning everyone!  And thank you, Joe, for the kind introduction and for the invitation to join you at this outstanding congress and expo.

I have been on the road for a number of days – from Iowa, talking to families at an opioid drug rehabilitation center, to Texas, rolling up my sleeves and taking part in a home build. Between us, I don’t know if a pediatric neurosurgeon is the best person to be handed a chain saw. 

When I originally got the invitation to join you, I was quick to say yes. Back when my hair was less gray, when you thought of manufactured homes, you basically thought of a small box, on concrete blocks, with some uninspiring siding or trim. Times have certainly changed.

Just walking through the expo today, you come to better understand the truly amazing transformation of the manufacturing housing industry.  These are simply wonderful homes – with great amenities like fireplaces and special kitchen cabinets.

I appreciate your dedication to innovative building materials, cutting edge manufacturing techniques, and equally important, meeting the demands of the marketplace. What millennial wouldn’t want power strips installed into countertops? Or a special wireless console to control everything from thermostat to blinds to baby monitors? 

In fact, I understand that your next speaker is from Ducker Worldwide, and that he will discuss shifting demographics and consumer tastes. It is vital that we all gain better insights into the various segments of homebuyers.   

Before I join Joe in a more detailed conversation, let me give you a quick update on what’s going on at HUD and then discuss such issues as deregulation and making housing affordable.

Quick HUD Update

Last week, I was on Capitol Hill testifying before the Senate Appropriations Committee. At HUD, we’re looking at a requested funding level of over $41.240 billion, which even in these times of fiscal restraint, represents a 1.4 percent increase over last year’s budget.

Let me say straight out, at HUD, it is not about how much money we spread around. We define success not by the amount of money we pour into our programs, but by the number of people we help graduate from our services and become self-sufficient. Only then can we begin to help others in need of our resources.

HUD is working throughout all of nation’s cities and communities to provide safe, fair, and affordable housing for the American people.  And we oversee a large number of programs and initiatives to help us reach our goals, especially in the way of bolstering economic opportunity and self-sufficiency.

It may seem hard to believe, but we are amid a major transformation in the way we tackle our challenges. It will take time, it will not be easy, but in the end, I think we will reinvigorate HUD – both in its mission, programs, and yes, in our extensive regulatory agenda—a point I will return to later.

It’s no secret that the current model of public housing is unsustainable. We are now looking at several unique and innovative ways to assist families. For example:

  • We’re working with public housing authorities to convert public housing assistance to vouchers -- which would save taxpayer money and give families more choice in deciding where they live.
  • We are modernizing and streamlining existing rental assistance programs.
  • We’re also looking at voluntary conversions of our nation’s housing stock so assisted families and others can own their own units.
  • And we’re spurring greater economic opportunity by connecting public housing residents to job training, financial education and childcare among other services through our Envision Center Initiative.

These are just some of the highlights of what HUD is currently involved with, as we drive for new efficiencies, transparency, and accountability in our large portfolio – or as some would call it, our alphabet soup of programs and services.

Affordability Challenges

It’s now been over a year since I was sworn in as the Secretary of HUD and I can tell you, from my perspective, one of the biggest challenges we face is our nation’s affordable housing crisis.

Given the high cost of housing along the east and west coasts, that should not come as a surprise. According to the economists, we are experiencing the biggest jump is housing prices in four years – prices are rising while the supply of housing is getting smaller. It’s basic supply and demand.

That’s why everyone in this audience and the manufactured housing industry is so important – and that’s why I am here today.  You are a big part of the solution to providing unsubsidized, quality, affordable housing.

I can tell you without any qualification that this Administration appreciates all you are doing in the way of making homes more affordable and in creating good paying jobs. We especially applaud your use of American suppliers and products in your manufacturing plants.

You have brought the pride of craftsmanship back to our shores.   

I have looked at industry data and statistics and they’re impressive.

The average new manufactured home is only $70,600. In several of our largest cities, you can pay nearly that for a parking space. With the median annual income of manufactured homeowners being around $30,000, you are already capturing an increasingly important segment of the of the housing market, like young married couples.

And as the suburbs continue to grow further out and land prices rise, it’s no surprise that two-thirds of all occupied manufactured homes in the U.S. are located outside of major metropolitan areas.

Most of you already know these facts and figures. But it’s important that the word gets out of regarding your accomplishments in creating jobs and affordable housing.  In fact, in my testimony to the Senate last week, I specifically noted how manufactured housing accounts for nearly 10 percent of the market and even a greater share in rural areas.

HUD can help you continue this success.  

Deregulation Challenge

I understand only too well that your industry wants and needs regulatory relief. The overall number of regulations on a local, state and national level that all American businesses must comply with, are damaging to everyone’s bottom line. It’s a stealth tax.

Overall, the Code of Federal Regulations has doubled in the past five years to more than 185,000 pages, which someone has calculated to be the equivalent of more than 100 Kings James Bibles. As for our contribution to this, I would say at least some of the first books of Moses.

The promise of the previous administration to eliminate burdensome rules and regulations was a false start, but not in the Trump Administration. One of the first actions by the President was to impose a two-for-one rule on new federal regulations. He ordered that for every new regulation, two old regulations must be eliminated.  

But the President went even further.

He challenged his Cabinet to find and remove every single outdated and excessive regulation currently on the books, so we can free our economy from years of federal overreach and intrusion.

Of course, not all regulations are “bad” or misguided. They can really do good for industry and for consumers.    

We would surely agree that rules and regulations established by the national Manufactured Housing and Construction and Safety Act, and our enforcement of these regulations, has brought about a significant improvement in the quality and safety of manufactured homes. 

I have heard how one of our senior engineers was thanked by an owner of a manufactured home in Florida after Hurricane Charley in 2004. His place survived a major storm while other homes built on-site didn’t – all because of the high wind standards that are in place. 

Saving lives and property is as good as it gets when it comes to why we have rules and regulations.  

We would also agree that the HUD Code has delivered many benefits to the marketplace, including high standards for health, energy efficiency and durability.   

Finally, I think we would agree that the time is ripe for HUD and the Office of Manufactured Housing Programs to conform to the President’s agenda on eliminating or streamlining regulations that are wasteful or inefficient. In short, to create a more cooperative and coordinated regulatory environment.

Deregulation issues

Of course, there are disagreements. Your leadership and fellow members have let us know where improvements can be made and what issues need to be addressed.  

We understand:

  • Some of our regulations lack clarity or do not always incorporate your feedback into our guidelines.
  • That we need to conduct more effective cost-benefit analysis, testing and research to update the HUD Code. And do so in a timelier manner.
  • Also, that we need to shift away from just writing rules and regulations to highlight and encourage best practices, as well as to provide for more regulatory flexibility.
  • Finally, that more needs to be done with FHA financing to encourage more buyers of manufactured homes.

I am sure I could go on but let me just say that as the Secretary of HUD, “I hear you.”  As noted earlier, we are going to repeal two existing regulations for every new regulation. We now have a regulatory task force whose job it is to do a top to bottom review of all our manufacturing housing regulations and policies.

In January, we invited the public to comment on our policies and to assess the costs of complying with our rules and regulations. And we are now busy sorting and reviewing the more than 150 unique suggestions. I hear that they cover everything from on-site completion of construction of manufactured housing to guidance on establishing foundation requirements in freezing temperature areas.

The key to implementation of these comments will be the Manufactured Housing Consensus Committee managed by HUD, as they revise our standards and regulations. We anticipate meeting in September, but right now we’re looking to fill seven vacancies before that happens. In fact, the nomination period closed just last week. 

Conclusion

Let me close on this note.

HUD is now positioned to usher in a new era of cooperation and coordination with your industry. Make no mistake, we understand how you are vital to our economy and to our agency’s goal of making safe, quality, desirable and affordable homes for millions of hard working Americans.

Thank you again for the invitation to join you here today.

END