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Subcommittee backs audit and notice reforms for resident-owned and consumer cooperative manufactured-home communities
Summary
Lawmakers recommended passage of bills updating audit thresholds and notice requirements for resident-owned and consumer cooperative manufactured-home communities, citing that audit thresholds have not been updated in 25 years and these communities house thousands of households statewide.
The Senate Subcommittee on Housing recommended passage of bills to update audit and notice requirements for resident-owned manufactured-home communities and consumer cooperative associations.
Senator Reardon told the committee that resident-owned communities now represent about 9,000 households statewide and that manufactured housing makes up roughly 7 percent of the state's housing stock. The subcommittee heard that audit thresholds requiring a full audit have not been updated in 25 years and that the fixed cost of a full audit can be nearly $10,000, a significant burden for small, volunteer-run cooperatives.
What the bills would do: The preferred vehicle adjusts thresholds at which different levels of financial review (compilation, review, audit) are required so that smaller cooperatives are not forced into the most costly audit requirement simply because statutory dollar thresholds were not updated. A related bill requires sellers of units in resident-owned communities to provide notice and certain financial information to prospective buyers to aid sales.
Committee action: The subcommittee voted to recommend SB 166 (audit thresholds / notice requirements) and SB 165 (consumer cooperative audit requirements) ought to pass; SB 167 (a related requirement) was recommended ITL (inexpedient to legislate) by the sponsor’s request as the committee consolidated vehicles and corrected numeric thresholds.
Why it matters: Supporters said these communities are an important source of affordable housing and that updating statutory thresholds will reduce burdens on small nonprofit cooperatives while preserving appropriate financial oversight. The Municipal Association and others did not oppose these reforms in the final recommendation after committee consolidation of duplicate bills.
Next steps: The bills will move forward per the committee’s recommendation; sponsors said they would use the preferred vehicle to carry the corrected thresholds and notices through the legislative process.
