On June 12, HUD issued a proposed rule to revise the definition of “manufactured home” such that transportable sections serving as upper floors of manufactured homes would not need to be transported or built on a permanent chassis. HUD stated that the proposal would amend the definition in: (i) the Manufactured Home Construction and Safety Standards; (ii) the Model Manufactured Home Installation Standards; and (iii) the Manufactured Home Installation Program regulations. It would also make related changes to manufactured home loan regulations to ensure homes with upper floors built without a permanent chassis would remain eligible for Title I loans. The proposed rule notes that HUD had generally interpreted existing regulatory definitions to require each transportable section to be built on a permanent chassis, but now proposes to apply the requirement to the completed manufactured home rather than each individual section.

Under the proposal, only the lowest-level transportable sections would need to be built on a permanent chassis, while upper-floor sections would not need to be transported or built on one. HUD estimated that eliminating the upper-floor chassis requirement would reduce production, transportation and installation costs for multistory manufactured homes by an estimated $4,800 to $6,700 per unit and contended that the change would support multistory construction and manufacturer design flexibility. HUD noted that some modular building manufacturers and a modular building association submitted letters generally opposing the draft changes, asserting that the changes could obscure the distinction between their products and manufactured homes. Comments must be submitted by August 11.