Legislature(1993 - 1994)

03/03/1994 08:00 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
  HB 358 - MOBILE HOME REGISTRATION & TITLES                                   
  CHAIRMAN VEZEY reconvened the meeting at 8:57 a.m.  CSHB 358                 
  was opened for discussion.                                                   
  CSHB 358:  "An Act requiring a mobile home owner to obtain a                 
  certificate of title and requiring the Department of Public                  
  Safety to issue a certificate of title to a mobile home                      
  Number 011                                                                   
  gave the sponsor statement for HB 358.  He said, in 1992,                    
  the Governor's Omnibus and Fee Reduction bill eliminated the                 
  mobile registration service and the state's ability to issue                 
  titles to mobile home owners.  Without a title, there is no                  
  certain way to determine a person selling a mobile home is                   
  the real owner, or whether they first must pay off a lean                    
  holder.  HB 358 would give mobile home owners a tool to                      
  facilitate honest transactions.  He noted dealers, financial                 
  institutions, consumers, and owners are all agree they                       
  should pay an appropriate fee to maintain the cost of                        
  maintaining a title system.                                                  
  Number 049                                                                   
  CHAIRMAN VEZEY noted he did not have a title on his home,                    
  which is real property.                                                      
  Number 057                                                                   
  MR. LOUNSBURY responded real property uses another form,                     
  rather than mobile homes which currently do not have                         
  Number 066                                                                   
  CHAIRMAN VEZEY pointed out he owns a large amount of                         
  expensive equipment which also does not have titles.                         
  Number 071                                                                   
  MR. LOUNSBURY stated businesses are required by law to                       
  provide titles; however, individuals are not as structured.                  
  Therefore, documentation is needed to facilitate the selling                 
  of mobile homes.                                                             
  (REPRESENTATIVE SANDERS returned to the meeting at 9:00                      
  Number 087                                                                   
  REPRESENTATIVE G. DAVIS responded to CHAIRMAN VEZEY's                        
  comment that he did not have a title to his home.  He                        
  commented that it may be cheaper to receive a title to his                   
  home, instead of the process that we currently go through to                 
  assure lenders that we do properly own our residences.                       
  Number 095                                                                   
  CHAIRMAN VEZEY pointed out a title does not actually                         
  guarantee ownership.  People often legally buy and sell                      
  items without changing the title.                                            
  Number 112                                                                   
  REPRESENTATIVE KOTT moved to adopt the committee substitute                  
  to HB 358, version K.                                                        
  CHAIRMAN VEZEY recognized the motion, the committee                          
  secretary called the roll, and the CSHB 358, version K, was                  
  Number 129                                                                   
  REPRESENTATIVE KOTT asked MR. LOUNSBURY to explain the                       
  differences between the original HB 358 and CSHB 358.                        
  Number 132                                                                   
  MR. LOUNSBURY responded the committee substitute was                         
  introduced to tighten up the title, so when it goes over to                  
  the Senate, they could not add anything on to it.  CSHB 358                  
  reads, "An act requiring a mobile home owner," instead of,                   
  "An act allowing."  CSHB 358 also raises the fee from $50 to                 
  $100 to generate an effective program for the state in terms                 
  of cost responsibility, which was approved by the home                       
  owners, realtors and banks.                                                  
  Number 154                                                                   
  CHAIRMAN VEZEY pointed out the fiscal note was for the                       
  original HB 358.                                                             
  REPRESENTATIVE OLBERG clarified the fiscal note states it is                 
  for the sponsor substitute dated March 2, 1994; however, he                  
  believed it was intended for the committee substitute.                       
  CHAIRMAN VEZEY replied JUANITA HENSLEY signed the fiscal                     
  note and the committee would clarify her intent when she                     
  Number 172                                                                   
  testified in favor of CSHB 358.  She felt anyone could claim                 
  ownership to a mobile home and a system was needed to keep                   
  track of them.  Mobile homes are taxed by municipalities as                  
  real property.  She asked if the fee charged for a title                     
  would include a history search and if there would be                         
  assurance that the chain of title would remain on file.  She                 
  continued the new types of mobile homes currently fabricated                 
  are sturdy, lasting many years, and possibly changing                        
  ownership at least a dozen times.  She stressed banks were                   
  very difficult to deal with without proof of ownership.  She                 
  stated an example of a couple having bought a mobile home,                   
  not transferring the title, fixed it up, sold it again, and                  
  the original owner has passed away.  The people who are                      
  buying the home have paid it off, the middle couple has a                    
  title with the deceased's name on it and no bill of sale,                    
  and there is no one to prove they bought it.  With a title                   
  standard, this type of confusion could be avoided.  She also                 
  felt some people may begin to resell the same mobile home                    
  repeatedly and there would not be any proof of who owns it.                  
  Number 231                                                                   
  CHAIRMAN VEZEY commented there is also a lot of real                         
  property in the state which is in the same dilemma.  He                      
  asked MS. WALKER if it was her testimony that at this time a                 
  title does not guarantee who the owner is?                                   
  Number 238                                                                   
  MS. WALKER replied, on the surface a title does not.                         
  Number 240                                                                   
  CHAIRMAN VEZEY clarified owners, sellers, and operators of                   
  mobile home parks need a system to provide a chain of title.                 
  Number 244                                                                   
  MS. WALKER agreed.                                                           
  Number 248                                                                   
  CHAIRMAN VEZEY stated ROD HULSE, SWITZER VILLAGE, deferred                   
  his testimony, but he was available to testify.                              
  Number 257                                                                   
  testified in favor of CSHB 358.  She would like an effective                 
  title system which would give security to title owners.  She                 
  gave an example of her and her husband's own personal                        
  experience in buying a mobile home.  After they bought their                 
  home, they looked for a title transfer.  The seller,                         
  however, stated the title had been stolen. They have had a                   
  very difficult time trying to locate an agency to receive an                 
  official title from file.  They could only get a computer                    
  printout from the Juneau Division of Motor Vehicles (DMV),                   
  which stated the seller really did own the mobile home, and                  
  after two tries, has now received a legal bill of sale.  MS.                 
  CAMPBELL would like an official record of the title change                   
  and would prefer a computer record at the DMV.  She was                      
  surprised at the increase in of the fee from $50 to $100.                    
  Number 344                                                                   
  CHAIRMAN VEZEY suggested MS. CAMPBELL talk to an attorney to                 
  protect her property investment.                                             
  MS. CAMPBELL preferred to not seek an attorney's help.                       
  Number 355                                                                   
  REPRESENTATIVE OLBERG clarified that CHAIRMAN VEZEY was                      
  suggesting MS. CAMPBELL should seek an attorney because of                   
  the degree of the situation she is in.                                       
  Number 360                                                                   
  CHAIRMAN VEZEY pointed out there are many options available                  
  to protect an ownership interest.                                            
  CHAIRMAN VEZEY introduced JUANITA HENSLEY, DMV, and asked                    
  her if the DMV believes it is a proper function of DMV to                    
  act in this role?                                                            
  Number 377                                                                   
  PUBLIC SAFETY, answered questions on CSHB 358.  She                          
  responded the DMV suggested with the Governor's 1992 Omnibus                 
  bill to delete the titling of mobile homes.  DMV felt mobile                 
  homes were a function of real property, and should be                        
  treated as such, as opposed to a vehicle.  In meeting with                   
  REPRESENTATIVE PORTER and others over the problems in                        
  obtaining the proper documentation on mobile homes they                      
  agreed, providing the burden was not placed on the DMV and                   
  the program would pay for itself, the DMV would reissue                      
  titles to mobile homes.  During this period there were title                 
  searches through a real estate title search and the                          
  Recorder's Office was having to do extensive research as                     
  well in UCC filings.                                                         
  DMV had requested mobile home titling be deleted from the                    
  statute, in 1992, because titling was not required by the                    
  owners.  There was an immense amount of research to go                       
  through, especially in cases where ownership may have                        
  changed 4-5 times.  Past files had even been purged from the                 
  filing system making the process very labor intensive.                       
  Prior to the mandate, as proposed in HB 408, DMV issued                      
  approximately 200 mobile home titles a year.  DMV estimates                  
  it would issue 2,500 titles, based on information from the                   
  industry.  This figure includes the 1,500 new units sold per                 
  year statewide by the industry, plus an additional 1,000                     
  from individuals who may sell theirs.  DMV suggested the                     
  $100 fee believing it would not be too costly, because it                    
  would cost more to go through the UCC filing, and also title                 
  searches through a real estate company.  MS. HENSLEY's                       
  fiscal note indicates CSHB 358 would bring in $250,000 a                     
  year in revenue, at an operating cost of $110,000 to the                     
  state.  DMV has no objection to titling mobile homes as long                 
  as it pays for itself.                                                       
  Number 430                                                                   
  CHAIRMAN VEZEY inquired if the DMV had to do a UCC search to                 
  issue a title.                                                               
  MS. HENSLEY responded that the DMV does not do a UCC search.                 
  DMV offers a title based on a bill of sale or, if the                        
  vehicle is new, documentation from a bank or a                               
  manufacturer's certificate of origin.  Whenever that vehicle                 
  is sold the owner would then be required to change titles                    
  just as motor vehicles do.                                                   
  Number 439                                                                   
  CHAIRMAN VEZEY did not feel his constituents, of which many                  
  live in mobile homes, would like him to pass a bill which                    
  would require them to go in and title their home.  He asked                  
  if mobile homes were considered as real property if they                     
  were sold in improvement to real property.                                   
  MS. HENSLEY could not answer if mobile homes were treated as                 
  real estate property or not.                                                 
  Number 449                                                                   
  CHAIRMAN VEZEY clarified real property refers to the fee                     
  simple, a stake in land, and the improvements thereon.  He                   
  felt CSHB 358 would require a lot of people to have to go                    
  and buy a title, when they may have already gone through the                 
  recording process for real property.                                         
  Number 457                                                                   
  MS. HENSLEY was not familiar with the requirements for leans                 
  by financial institutions for real property, when a mobile                   
  home is set on it.                                                           
  Number 462                                                                   
  CHAIRMAN VEZEY asked if MS. HENSLEY was including UCC                        
  agreements, in the category of leans, on mobile homes.                       
  Number 464                                                                   
  MS. HENSLEY responded the DMV made the suggestion to the                     
  Governor's Omnibus bill because if, for example, a person                    
  bought a boat, a UCC filing lean would be required if it is                  
  financed.  A person would have to pay a filing fee for banks                 
  to file a UCC lean on the boat.  DMV used to do an immense                   
  amount of research.                                                          
  Number 474                                                                   
  CHAIRMAN VEZEY asked the cost of filing or recording a UCC                   
  agreement, deed, or bill of sale.  He believed it was $10.                   
  Number 479                                                                   
  MS. HENSLEY answered, according to information from                          
  REPRESENTATIVE PORTER's office, titling through the DMV                      
  would be more cost effective to the owners, even at $100.                    
  Number 497                                                                   
  CHAIRMAN VEZEY asked why it costs more to record an                          
  ownership transaction dealing with real property, than                       
  dealing with vehicle property and titles.                                    
  Number 500                                                                   
  MS. HENSLEY responded real estate companies would require                    
  full land recorder title searches and UCC title searches                     
  even on mobile homes.                                                        
  Number 514                                                                   
  CHAIRMAN VEZEY clarified DMV could title mobile homes                        
  cheaper than the private sector in conjunction with the                      
  Recorder's Office.  He thought the DMV might be presumptuous                 
  in their cost expectations and did not feel the cost of the                  
  private sector was fair in comparison to the DMV.                            
  Number 526                                                                   
  MS. HENSLEY felt the DMV was efficient and information                       
  received back from the sponsor, from a meeting last summer                   
  with other legislators and their constituents, regarding                     
  mobile home owners and dealers, they felt it was very costly                 
  to continue the current process of title acquirement.                        
  Number 535                                                                   
  REPRESENTATIVE OLBERG stated the 1,500 new units sold per                    
  year would take five minutes for the DMV, noting the                         
  efficiency.  The 1,000 used mobile home sales per year,                      
  everyone who already has a title without too many changes of                 
  ownership, would still be relatively simple.  There will be                  
  some titles extremely complicated.  He pointed out UCC                       
  searches and title searches are expensive.                                   
  Number 545                                                                   
  CHAIRMAN VEZEY stated the amount of money spent in insuring                  
  land through searches is much more guaranteed than a title                   
  received by DMV.  He thought a type of insurance policy                      
  which guarantees a mobile home title might be helpful.                       
  MS. HENSLEY responded a guarantee is not available for                       
  mobile home owners.                                                          
  Number 560                                                                   
  CHAIRMAN VEZEY thought the guarantee was available if they                   
  own the land the improvement sits on.  A mobile home on                      
  rented space would not have this option.                                     
  Number 562                                                                   
  MS. HENSLEY commented, in the municipality of Anchorage,                     
  they show 4,884 mobile homes in parks where the land is not                  
  usually owned.  Fairbanks Community Research Center advised                  
  they have 2,268 mobile homes in mobile home parks.                           
  Number 570                                                                   
  REPRESENTATIVE OLBERG clarified when a mobile home becomes                   
  permanently attached to the ground by foundation on a                        
  specific piece of land, it is no longer a mobile home.                       
  Number 575                                                                   
  CHAIRMAN VEZEY believed a title company would not issue                      
  title insurance unless the owner also had a fee simple                       
  interest in the property where the improvement sits.                         
  REPRESENTATIVE OLBERG agreed, but the mobile home would only                 
  be an improvement and would not relate to the property                       
  Number 581                                                                   
  MS. HENSLEY pointed out every mobile home without a title,                   
  under CSHB 358, would have to get one.  She did not have the                 
  exact number, and offered CHAIRMAN VEZEY could revise the                    
  total cost of the title down further.  DMV suggested the                     
  $100 fee to pay for the process.  New and used mobile home                   
  sales, 2,500 per year, would be the focus of the DMV.                        
  Number 591                                                                   
  REPRESENTATIVE G. DAVIS stated the large amount of mobile                    
  home owners in certain districts was of concern to him.  He                  
  clarified these owners would not have to rush down and get                   
  titles.  CSHB 358 states the DMV shall issue a certificate                   
  of title to the owner upon application and payment.  If an                   
  owner wanted to sell their mobile home, a guarantee of                       
  ownership could be acquired at the DMV.                                      
  Number 599                                                                   
  CHAIRMAN VEZEY pointed out CSHB 358 is "an Act requiring" a                  
  mobile home owner.  CSHB 358 does not distinguish between                    
  those renting a space or those who own the property.                         
  Number 601                                                                   
  REPRESENTATIVE OLBERG sensed his constituents would not all                  
  rush down to obtain a title.  He felt the vast majority of                   
  mobile homes probably do have titles, because it's been less                 
  than a year since the program was in effect.                                 
  Number 612                                                                   
  CHAIRMAN VEZEY stated mobile homes in his district have sold                 
  numerous times, without the proper transfer of titles.  In-                  
  depth research would be involved.                                            
  Seeing no more testimony from MS. HENSLEY, CHAIRMAN VEZEY                    
  let MS. WALKER readdress the committee.                                      
  Number 627                                                                   
  MS. WALKER asked MS. HENSLEY if it would be possible to set                  
  up some kind of fee scheduling, whereby those requiring less                 
  research could pay a lesser amount.                                          
  Number 635                                                                   
  CHAIRMAN VEZEY answered anything was possible and a                          
  subcommittee would be formed to create a bill of useful                      
  commercial purpose, and not offensive to the public.                         
  CHAIRMAN VEZEY asked MR. LOUNSBURY to join the table.  The                   
  committee understands the intent of CSHB 358.  CHAIRMAN                      
  VEZEY suggested a subcommittee be formed and MR. LOUNSBURY                   
  be a part of it.  He would like to meet with those                           
  knowledgeable of the legal ramifications of establishing                     
  MR. LOUNSBURY stated, in reference to CHAIRMAN VEZEY's                       
  constituents, that he was informed by staff of Les Fickes,                   
  Riverview Mobile Home Park Owner, that he would be in favor                  
  of a bill like CSHB 358.  MR. LOUNSBURY said he had no                       
  objection with forming a subcommittee.                                       
  Number 666                                                                   
  CHAIRMAN VEZEY knew both Mr. Fickes and Mr. Rahoy who own                    
  mobile parks in his districts, but believed there was a                      
  general lack of understanding in commercial standards and                    
  legality of ownership.  He thought the committee should have                 
  "an expanded picture."                                                       
  Number 674                                                                   
  REPRESENTATIVE OLBERG thought "when ownership changes" could                 
  be added to the title of the CSHB 358.                                       
  Number 679                                                                   
  CHAIRMAN VEZEY responded this change would make CSHB 358                     
  more palatable.  He pointed out those who buy and sell real                  
  property are not required to record their transactions.                      
  Number 683                                                                   
  REPRESENTATIVE OLBERG thought the requirement would also not                 
  be 100 percent complied with, either.                                        
  Number 684                                                                   
  REPRESENTATIVE G. DAVIS proposed the title might be changed                  
  to read, "An Act relating to a mobile home owner to obtain,"                 
  instead of, "requiring."  He noted "requiring" is the word                   
  the committee is having problems with.                                       
  Number 689                                                                   
  CHAIRMAN VEZEY stated the original bill is "An Act allowing                  
  a mobile home owner."                                                        
  Number 691                                                                   
  REPRESENTATIVE OLBERG liked the original title better, but                   
  questioned the concern that it was too broad.                                
  Number 692                                                                   
  REPRESENTATIVE KOTT inquired if the was a companion Senate                   
  Bill in the Senate presently.                                                
  Number 698                                                                   
  CHAIRMAN VEZEY paused the committee to change the tape.                      
  TAPE 94-21, SIDE A                                                           
  Number 000                                                                   
  CHAIRMAN VEZEY resumed the meeting.                                          
  Number 002                                                                   
  REPRESENTATIVE G. DAVIS felt eliminating the word                            
  "requiring" would satisfy his concerns with CSHB 358.  There                 
  will always be those individuals who do not follow the                       
  transfer process.  He moved page 1, line 1, to read, "An Act                 
  relating to a mobile home owner to obtain a title."                          
  Number 034                                                                   
  CHAIRMAN VEZEY interjected he could entertain the motion,                    
  however, he would like more testimony on CSHB 358 before it                  
  is passed out of committee.  He did agree flexibility needed                 
  to be created in CSHB 358.  CHAIRMAN VEZEY stated CSHB 358                   
  would be rescheduled in the near future.                                     
  REPRESENTATIVE G. DAVIS withdrew his motion.                                 
  Number 054                                                                   
  REPRESENTATIVE KOTT commented the subcommittee should also                   
  examine the fee schedule.  He believed 2,500 titles at $45                   
  would cost $112,000, which would be more appropriate.                        
  Number 063                                                                   
  CHAIRMAN VEZEY referred to the time, risk and liability,                     
  involved in doing title searches as MS. HENSLEY had                          
  mentioned.  He noted a title search could not be bought for                  
  $100 for property.                                                           
  Number 079                                                                   
  REPRESENTATIVE KOTT commented there may be constitutional                    
  problems in varying the fees for those requiring less                        
  Number 088                                                                   
  CHAIRMAN VEZEY felt if a person could establish qualified                    
  ownership and have it recorded for posterity, then a $100                    
  fee would not be unreasonable.                                               
  CSHB 358 was held in committee to be rescheduled.                            
  Number 119                                                                   

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