SB 5627 — Concerning the sale of manufactured/mobile home communities.

S-3836.4SUBSTITUTES-1136.1SENATE SENATE BILL 5627State of Washington65th Legislature2018Legislature2017 Regular SessionBy Senate Financial Institutions & Insurance (originally sponsored by Senators Kuderer, Hunt, Saldaña, and Keiser)READKeiserRead FIRSTfirst TIMEtime 01/19/18.AN02/01/17. ACT Relating to the sale of manufactured/mobile home communities;

andReferred amending RCW 82.45.010.BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:Sec. 1.  RCW 82.45.010 and 2014 c 58 s 24 are each amended to readCommittee ason follows:(1)Financial AsInstitutions used& inInsurance.AN thisACT chapter,Relating the term "sale" has its ordinary meaning and includes any conveyance, grant, assignment, quitclaim, or transfer of the ownership of or title to real property, including standing timber, or any estate or interest therein for a valuable consideration, and any contract for such conveyance, grant, assignment, quitclaim, or transfer, and any lease with an option to purchase real property, including standing timber, or any estate or interest therein or other contract under which possession of the propertysale is given to the purchaser, or any other person at the purchaser's direction, and title to the property is retained by the vendor as security for the payment of themanufactured/mobile purchasehome price.communities;

amending RCW 59.20.030, 82.45.010, and 82.45.060;

adding new sections to chapter 59.20 RCW;

creating a new section;

and prescribing penalties.BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:NEW SECTION.  Sec. 1.  (1) The legislature finds that:(a) It is the policy of this state to encourage affordable housing ownership, including manufactured/mobile home community living.(b) Manufactured/mobile home communities provide a significant source of homeownership opportunities for Washington residents.

However, the increasing closure and conversion of manufactured/mobile home communities to other uses, combined with increasing manufactured/mobile home lot rents, low vacancy rates in existing manufactured/mobile home communities, and the extremely high cost of moving homes when manufactured/mobile home communities close, increasingly make manufactured/mobile home community living insecure for manufactured/mobile home tenants.(c) Many tenants who reside in manufactured/mobile home communities are part of low-income households and senior citizens and are, therefore, those residents most in need of reasonable security in the siting of their manufactured/mobile homes because such tenants experience adverse impacts on their health, safety, and welfare when forced to move due to closure, change of use, or discontinuance of manufactured/mobile home communities.(2) It is the intent of the legislature to encourage and facilitate the preservation of existing manufactured/mobile home communities in the event of voluntary sales of manufactured/mobile home communities and, to the extent necessary and possible, to involve manufactured/mobile home community tenants or an eligible organization, such as a nonprofit organization, housing authority, community land trust, or local government, in the preservation of manufactured/mobile home communities.(3) This subsection is the tax preference performance statement for the tax preference in section 7 of this act.

The performance statement is only intended to be used for subsequent evaluation of the tax preference.

It is not intended to create a private right of action by any party or be used to determine eligibility for preferential tax treatment.(4) The legislature categorizes this tax preference as one intended to provide individual tax relief, as indicated in RCW 82.32.808(2)(e).(5) It is the legislature's specific public policy objective to extend the real estate excise tax exemption for qualified sales of a manufactured/mobile home community.(6) The joint legislative audit and review committee is not required to assess the effectiveness of the tax preference in section 7 of this act, in achieving the intent and specific public policy objective stated in this section.Sec. 2.  RCW 59.20.030 and 2008 c 116 s 2 are each amended to read as follows:For purposes of this chapter:(1) "Abandoned" as it relates to a mobile home, manufactured home, or park model owned by a tenant in a mobile home park, mobile home park cooperative, or mobile home park subdivision or tenancy in a mobile home lot means the tenant has defaulted in rent and by absence and by words or actions reasonably indicates the intention not to continue tenancy;(2) "Eligible organization" includes local governments, local housing authorities, nonprofit community or neighborhood-based organizations, federally recognized Indian tribes in the state of Washington, and regional or statewide nonprofit housing assistance organizations;(3) "Housing authority" or "authority" means any of the public body corporate and politic created in RCW 35.82.030;(4) "Landlord" means the owner of a mobile home park and includes the agents of a landlord;(5) "Local government" means a town government, city government, code city government, or county government in the state of Washington;(6) "Manufactured home" means a single-family dwelling built according to the United States department of housing and urban development manufactured home construction and safety standards act, which is a national preemptive building code.

A manufactured home also:

(a) Includes plumbing, heating, air conditioning, and electrical systems;

(b) is built on a permanent chassis;

and (c) can be transported in one or more sections with each section at least eight feet wide and forty feet long when transported, or when installed on the site is three hundred twenty square feet or greater;(7) "Manufactured/mobile home" means either a manufactured home or a mobile home;(8) "Mobile home" means a factory-built dwelling built prior to June 15, 1976, to standards other than the United States department of housing and urban development code, and acceptable under applicable state codes in effect at the time of construction or introduction of the home into the state.

Mobile homes have not been built since the introduction of the United States department of housing and urban development manufactured home construction and safety act;(9) "Mobile home lot" means a portion of a mobile home park or manufactured housing community designated as the location of one mobile home, manufactured home, or park model and its accessory buildings, and intended for the exclusive use as a primary residence by the occupants of that mobile home, manufactured home, or park model;(10) "Mobile home park," "manufactured housing community," or "manufactured/mobile home community" means any real property which is rented or held out for rent to others for the placement of two or more mobile homes, manufactured homes, or park models for the primary purpose of production of income, except where such real property is rented or held out for rent for seasonal recreational purpose only and is not intended for year-round occupancy;(11) "Mobile home park cooperative" or "manufactured housing cooperative" means real property consisting of common areas and two or more lots held out for placement of mobile homes, manufactured homes, or park models in which both the individual lots and the common areas are owned by an association of shareholders which leases or otherwise extends the right to occupy individual lots to its own members;(12) "Mobile home park subdivision" or "manufactured housing subdivision" means real property, whether it is called a subdivision, condominium, or planned unit development, consisting of common areas and two or more lots held for placement of mobile homes, manufactured homes, or park models in which there is private ownership of the individual lots and common, undivided ownership of the common areas by owners of the individual lots;(13) "Notice of sale" means a notice required under RCW 59.20.300 to be delivered to all tenants of a manufactured/mobile home community and other specified parties within fourteen days after the date on which any advertisement, multiple listing, or public notice advertises that a manufactured/mobile home community is for sale;(14) "Park model" means a recreational vehicle intended for permanent or semi-permanent installation and is used as a primary residence;(15) "Qualified sale of manufactured/mobile home community" means the sale, as defined in RCW 82.45.010, of land and improvements comprising a manufactured/mobile home community that is transferred in a single purchase to a qualified tenant organization or to an eligible organization for the purpose of preserving the property as a manufactured/mobile home community;(16) "Qualified tenant organization" means a formal organization of tenants within a manufactured/mobile home community, with the only requirement for membership consisting of being a tenant;(17) "Recreational vehicle" means a travel trailer, motor home, truck camper, or camping trailer that is primarily designed and used as temporary living quarters, is either self-propelled or mounted on or drawn by another vehicle, is transient, is not occupied as a primary residence, and is not immobilized or permanently affixed to a mobile home lot;(18) "Tenant" means any person, except a transient, who rents a mobile home lot;(19) "Transient" means a person who rents a mobile home lot for a period of less than one month for purposes other than as a primary residence;(20) "Occupant" means any person, including a live-in care provider, other than a tenant, who occupies a mobile home, manufactured home, or park model and mobile home lot;(21) "Notice of opportunity to purchase" means a notice required under section 3 of this act to the department of commerce.NEW SECTION.  Sec. 3.  A new section is added to chapter 59.20 RCW to read as follows:(1) A landlord must provide a written notice of opportunity to purchase a manufactured/mobile home community by certified mail or personal delivery to the department of commerce within three business days after the date on which a landlord receives a bona fide offer to purchase his or her manufactured/mobile home community or the property on which the manufactured/mobile home community is located.

Notice by certified mail postmarked within three days of receipt of a bona fide offer to purchase is deemed to comply with the requirements of this section.(2) A notice of opportunity to purchase must include:(a) A statement that the landlord is, or is not, considering the sale of the manufactured/mobile home community;

and(b) The contact information for the landlord or landlord's agent who is responsible for communicating with the qualified tenant organization or eligible organization regarding an opportunity to make an offer for the sale of the property.NEW SECTION.  Sec. 4.  A new section is added to chapter 59.20 RCW to read as follows:A landlord may not close on the sale of his or her manufactured/mobile home community until ninety days after the date on which the notice of opportunity to purchase was delivered.NEW SECTION.  Sec. 5.  A new section is added to chapter 59.20 RCW to read as follows:(1) The department of commerce must maintain a list of all eligible organizations and qualified tenant organizations that submit to the department of commerce a written request to receive notices of opportunity to purchase manufactured/mobile home communities, as provided in section 3 of this act, containing the following information:(a) The name and mailing address of the eligible organization;

and(b) A statement that the eligible organization wishes to purchase a manufactured/mobile home community.(2) The department of commerce must provide a copy of the list required under this section to any person upon request.NEW SECTION.  Sec. 6.  A new section is added to chapter 59.20 RCW to read as follows:(1) A landlord who sells or transfers a manufactured/mobile home community and willfully fails to comply with section 3 or 4 of this act is liable to the state of Washington for a civil penalty in the amount of the greater of five thousand dollars or five percent of the total sales price.

This penalty is the exclusive remedy for a violation of section 3 or 4 of this act.(2) The attorney general may bring a civil action in superior court in the name of the state against a landlord under this section.Sec. 7.  RCW 82.45.010 and 2014 c 58 s 24 are each amended to read as follows:(1) As used in this chapter, the term "sale" has its ordinary meaning and includes any conveyance, grant, assignment, quitclaim, or transfer of the ownership of or title to real property, including standing timber, or any estate or interest therein for a valuable consideration, and any contract for such conveyance, grant, assignment, quitclaim, or transfer, and any lease with an option to purchase real property, including standing timber, or any estate or interest therein or other contract under which possession of the property is given to the purchaser, or any other person at the purchaser's direction, and title to the property is retained by the vendor as security for the payment of the purchase price.

The real estate excise tax under this subsection (3)(q)(ii) is imposed upon the person or persons who previously held a controlling interest in the entity.(r) A qualified sale of a manufactured/mobile home community, as defined in RCW 59.20.030, that takes place on or after June 12, 2008, but before December 31, ((2018)) 2026.---2026.Sec. 8.  RCW END82.45.060 ---and 2013 2nd sp.s.

c 9 s 6 are each amended to read as follows:There is imposed an excise tax upon each sale of real property at the rate of one and twenty-eight one-hundredths percent of the selling price, except that the excise tax upon each sale of a manufactured/mobile home community, as defined in RCW 59.20.030, to any person other than an eligible organization or qualified tenant organization, as defined in RCW 59.20.030, must be at the rate of five and twelve one-hundredths percent of the selling price.

Beginning July 1, 2013, and ending June 30, 2019, an amount equal to two percent of the proceeds of this tax must be deposited in the public works assistance account created in RCW 43.155.050, and an amount equal to four and one-tenth percent must be deposited in the education legacy trust account created in RCW 83.100.230.

Thereafter, an amount equal to six and one-tenth percent of the proceeds of this tax to the state treasurer must be deposited in the public works assistance account created in RCW 43.155.050.

Except as otherwise provided in this section, an amount equal to one and six-tenths percent of the proceeds of this tax to the state treasurer must be deposited in the city-county assistance account created in RCW 43.08.290.NEW SECTION.  Sec. 9.  If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.--- END ---