Regular Session 2017-2018 Senate Bill 0092 P.N. 0261

PRINTER'S NO. 261

THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

No.

Session of

2017

INTRODUCED BY GREENLEAF, MENSCH, TARTAGLIONE, RAFFERTY AND

BREWSTER, JANUARY 31, 2017

REFERRED TO CONSUMER PROTECTION AND PROFESSIONAL LICENSURE,

JANUARY 31, 2017

AN ACT

Amending the act of November 24, 1976 (P.L.1176, No.261),

entitled, as amended, "An act providing for the rights and

duties of manufactured home owners or operators and

manufactured home lessees," further providing for disclosure

of fees.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Section 6 of the act of November 24, 1976

(P.L.1176, No.261), known as the Manufactured Home Community

Rights Act, is amended by adding subsections to read:

Section 6. Disclosure of Fees.--* * *

(f) (1) (i) If a majority of the lessees of the community

believe the rent increase is excessive, they may, prior to the

implementation of the rent increase, request the resident

association's governing board to submit a written request to the

American Arbitration Association for the appointment of an

arbitrator.

(ii) The resident association shall certify on a

confidential basis the request and signatures of a majority of

the lessees who shall be notified of the cost involved in

seeking binding arbitration under this sub section .

(iii) After the certification the governing body of the

resident association shall pass a resolution specifically

requesting arbitration and agreeing to bear the appropriate

costs.

(iv) The arbitrator shall conduct binding arbitration

between the community owner or operator and the lessees.

(2) (i) If a community has no resident association, the

lessees shall gather, on a confidential basis, the signatures of

a majority of the lessees within the community who shall be

notified of the cost involved in seeking binding arbitration

under this section and agree to bear the appropriate costs.

(ii) After gathering the signatures of a majority of the

lessees, a written petition shall be submitted to the Bureau of

Consumer Protection in the Office of Attorney General that

includes the name of the person who will act as the

representative of the lessees and a statement that they dispute

the proposed lot rent increase.

(iii) The Bureau of Consumer Protection shall, upon receipt

of the written petition, contact the manufactured home community

owner informing him of the petition and requesting that the

community owner supply a complete list of all lessees within the

manufactured home community to verify that the petition

represents a majority of the lessees.

(iv) If the community owner fails to comply with the request

within 14 days of the receipt of the notice, the petition shall

be deemed valid and the community owner and representative of

the lessees shall be notified.

(v) The Bureau of Consumer Protection shall, after review,

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notify both the manufactured home community owner and the

representative of the lessees whether a majority of lessees has

been certified.

(vi) Upon receiving written notice from the Bureau of

Consumer Protection that the petition contains the names of a

majority of lessees, the lessees may submit a written request

for binding arbitration to the American Arbitration Association.

(vii) The arbitrator shall conduct binding arbitration

between the community owner or operator and the lessees.

(3) For purposes of determining the majority under this

subsection, there shall be one vote per manufactured home.

(g) The manufactured home community owner or the

manufactured home community owner's designee shall submit to the

binding arbitration and shall cooperate with the arbitrator in

providing information for the sole purpose of deciding the issue

of whether the increase in rent is excessive. Information

regarding the right to binding arbitration shall be provided to

each lessee upon signing a ground lease.

(h) (1) The arbitrator shall promptly hear the dispute and

render a decision based on the excessive rent increase standard.

For purposes of determining a reasonable return on the

manufactured home community owner's investment or equity, the

arbitrator shall perform a risk analysis and consider

alternative and comparative investments.

(2) The arbitrator may perform an analysis as to the

manufactured home community owner's need for a rent increase and

services provided to the park. The analysis shall be performed

for a period of not less than three years prior to the

application for rental increase. Any debt service incurred using

the manufactured community as collateral or other security for

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investment, enterprises, businesses or similar ventures separate

and apart from the manufactured home community may not be

included in the analysis.

(i) The costs and expenses of the arbitrator shall be borne

equally by the manufactured home community owner and the

lessees.

(j) The rental increase shall not take effect until the

conclusion of the arbitration, pending its outcome.

(k) A rent increase may not go into effect until the earlier

of one of the following:

(1) Completion of the binding arbitration process.

(2) One hundred twenty days after provision of the written

notice required under this section.

(l) For the purposes of this section, the term "excessive

rent increase" shall mean an increase which is unreasonable

based on the manufactured home community owner's or operator's

total expenses, including debt service, taxes and a reasonable

return on the owner's investment or equity in the park, if the

debt service is directly related to acquisition of the

manufactured community, but excluding debt service used to or

otherwise employed for a purpose other than that which is

directly related to the acquisition or capital management of the

manufactured home community.

Section 2. This act shall take effect in 60 days.

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