‘We’re talking about affordable housing’ | News, Sports, Jobs
Residents at the Minot mobile home park reported a spate of grievances in the year after their communities were purchased by Homes of America, LLC, joining a growing outcry against the mysterious company’s business practices.
Many of these complaints allege violations of regulations introduced by Senate Bill 2159 of 2021, including requirements to designate an official local office and related to communications failures and responses to maintenance requests. In response to outcry from municipalities across the state, SB 2243 was introduced at this year’s session. The bill seeks to address some of the issues reported by RV park residents.
According to several residents of HOA parks, general community maintenance has remained largely unfulfilled over the past year, while property rents have increased by more than 50%. These shortfalls have been attributed to a revolving door of local managers, some of whom they claimed quit in part because owners were limiting their ability to get the job done.
Despite assurances that new leases are afoot and that the increased rents will be used to improve communities and add amenities, residents are still waiting for many of those promises to materialize. A current Minot resident who bought a home in one of the HOA communities last August said he is still awaiting an updated lease.
HOA tenants were soon faced with few options, resulting in large numbers of them moving or selling their homes. Kent French, the director of government affairs for the North Dakota Manufactured Housing Association, was a cheerleader for the 2021 law, but after receiving a spate of complaints from Minot residents last year, even he acknowledged there were some loopholes .
“I’ve been working to find a legal solution to help residents who live in prefabs. These out-of-state LLCs could care less about the people who live in their communities.” French said.
North Dakota’s current Century Code allows for nested shell companies and registered agents that leave tenants in the dark as to who actually owns the land beneath their homes. Tenants had few avenues to turn to other sources than civil courts to address violations, but any damages they would recover are capped at $1,000, discouraging many from taking action.
Senator Dick Dever, R-Bismarck, who has also taken calls from residents of Bismarck RV parks, said: “It looks like the new company needs a kick as RV parks change hands. We introduced 2159 and he was missing his teeth. Some of the owners wrinkled their noses at this. Part of the problem is that residents don’t even know who the owners are.”
SB 2243 was introduced by Dever, Sens. Diane Larson and Bob Paulson along with House Representatives Karen Karls, Scott Louser and Keith Kempenich. This bill would introduce provisions requiring additional disclosures for owners and companies they buy, and additional penalties for violators. Anyone seeking a license to operate an RV park would have to provide the state with the names, addresses, and phone numbers of managers, officers, directors, partners, and shareholders once a year, and would increase the cap on civil penalties to $5,000 .
The most significant change would result in any owner found to be in breach of any of the provisions of the Act facing the suspension or revocation of their license to operate, which would suspend collection of all rents from tenants until the license is granted is restored. Other changes include wording that owners must provide all current copies of the lease terms, including any amendments and supplements, upon a tenant’s written request, and an extension of the rent increase notification window to 90 days for monthly leases.
Dave Anderson, director of the North American Manufactured Home Owners Association, of which North Dakota has a chapter, said the bill provides for some “Fundamental improvements in state law”, but said some major issues are being ignored.
Some of those concerns were brought before the legislature in the 2021 session, Anderson said, including the ability to pay and stay and longer window requirements for notices related to non-renewal of leases and liens. Another critical omission, Anderson said, is the lack of protections for renters from landlord retaliation, an accusation that has been leveled at HOA by homeowners across the country.
Valeria Steele, a West Virginia HOA resident, said several people who visited a city hall to discuss property rent increases returned home to find eviction notices on their front doors. Several Minot Parks residents who spoke to The Minot Daily News in recent months declined to comment on the records, citing concerns management would retaliate against them. North Dakota is one of nine states that do not have laws prohibiting landlord retaliation against renters.
Dever acknowledged that many residents of affected communities are passionate and even angry, but he hoped their statement of support for the legislation will shed some light on what he believes is at the heart of the problem.
“We’re talking about affordable housing. The actions of these wealthy foreign investors are causing problems for voters.” said Dever.
Another bill that has been introduced is House Bill 1328, which aims to change how RV parks are taxed on special assessments. RV parks are currently rated as commercial properties under the North Dakota Century Code, but HB 1328 proposes that properties within an RV park may not be rated higher than the rate applicable to residential properties of single-family homes within the county.
Dustin Gawrylow, a Bismarck-based political adviser and lobbyist in support of the bill, said the hope is that this tax law change will eventually ease the struggles of RV owners, who have faced steadily rising property rents over the years. Gawrylow stressed that the bill was not only intended to be a tax break for companies like HOA, but rather would encourage North Dakota-based owners to stay in business.
“When cities tax mobile home parks as commercial, that’s 200% more than equivalent properties in a residential area. The higher taxes will be passed on.” said Gavrylov. “Are we penalizing local property because bad actors are entering the market? I don’t think we should do that. We cannot guarantee lower rents, but current tax law encourages owners to take it out on residents.”
SB 2243 has yet to be reviewed by the Industry and Business Committee. HB 1328 is currently under review by the Finance and Taxation Committee and has received broad support in the testimony submitted, with an appeal on behalf of the cities of Bismarck and Fargo and the North Dakota League of Cities, citing concerns about the fairness and satisfaction with their current Situation were cited tax law.
No HOA representative, including CEO Bryon Fields Jr., has responded to requests for comment. The Minot Daily News also reached out to Abraham Anderson, a Tennessee mobile home park developer who is a member of a group that currently owns and operates the Wheatland Village community in Minot, but received no response prior to publication.