H.R. 3296House115th Congress (2017-2019)In Committee

Frank Adelmann Manufactured Housing Community Sustainability Act

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Updated April 15, 2026 at 5:11 PM UTC

The Frank Adelmann Manufactured Housing Community Sustainability Act amends the Internal Revenue Code to provide a federal tax credit for owners who sell land to resident‑owned cooperatives or nonprofit groups for use as manufactured‑home communities. The credit, equal to 75 % of the seller’s qualified gain, is intended to encourage the transfer of such properties to resident‑controlled entities and help preserve affordable housing. The law sets ownership, use‑covenant, and governance requirements, and it imposes a penalty if the land is not kept as a community for at least 50 years.

Key Provisions

Creates a new tax credit (Section 45S) that lets a seller claim a credit equal to 75 % of the gain realized when selling land to a qualified manufactured‑home‑community cooperative or nonprofit corporation.
To qualify, the seller (or a related person) must have owned the land for at least two years before the sale and must bind the buyer to keep the property as a manufactured‑home community for at least 50 years.
The buyer must be a resident‑owned cooperative or a nonprofit that meets specific membership and governance rules, including an elected board and equitable voting among resident members.
Both seller and buyer must elect the credit by signing an affidavit that is recorded with the deed; the seller claims the credit on its tax return.
If the buyer breaks the 50‑year use covenant, a penalty tax of 20 % of the net sale proceeds is imposed.
The credit is added to the general business credit list in Section 38 and to related code sections, and it takes effect for tax years beginning after Dec. 31, 2017.

Legislative Activity

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1 earlier action

HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

July 19, 2017

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HouseIntro Referral

Introduced in House

July 19, 2017

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

July 19, 2017

Floor Debate

1 member

What members said about H.R. 3296 on the floor

1 Democrat

Rep. Keith EllisonD-MN-5 · Dec 7, 2017

Mr. Speaker. I oppose this bill. It would remove consumer protections put in place by the Consumer Financial Protection Bureau. H.R. 1699 would weaken Home Ownership and Equity Protection Act (HOEPA) requirements for people who buy manufactured homes. HOEPA requires additional disclosures to people taking out a loan to buy a home when the interest rate is 6.5 percent or 8.5 percent above the annual percentage rate (APR) for the average Prime Offer Rate (APOR). Those disclosures include: Explaining the consequences of default, disclosing loan terms and monthly payments, and ensuring the borrower receives homeownership counseling.

In addition, the Consumer Financial Protection Bureau, under Regulation Z, forbids firms selling manufactured homes from steering buyers into loans. This bill would remove these protections.

Manufactured homes are the biggest source of unsubsidized affordable housing in the country. More than 17 million people live in manufactured homes. If you removed manufactured housing, our national homeownership rate would fall 6 percent. The homes are of good quality.

Thanks to the Dodd Frank Wall Street Reform and Consumer Protection Act, high-cost loans to manufactured homeowners are rare. Wednesday, we received updated Duty-to-Serve requirements from the Federal Housing Finance Agency which will provide even more affordable financing to these buyers.

Before Democrats enacted the Dodd Frank Wall Street Reform and Consumer Protection Act, the financing for manufactured homes was notoriously predatory. If you want to see how badly manufactured homebuyers used to be treated, read the award-winning series of articles in the Seattle Times. The investigation showed that the main seller of manufactured homes--Clayton Homes--steered borrowers to lenders like Vanderbilt Mortgage and 21st Mortgage which Clayton actually owned.

Clayton's loans are particularly expensive compared with those of its peers. The company locks buyers in loans at interest rates that can exceed 15 percent. If this bill, H.R. 1699 was enacted, borrowers could again be asked to pay 14 or 15 percent without being told that there might be cheaper options.

I've also introduced bills to help manufactured home buyers:

The Energy Efficient and Manufactured Home Act (H.R. 515) helps manufactured home buyers replace their outdated homes.

Two bills--the Frank Adelmann Manufactured Housing Community Sustainability Act, (H.R. 3296) and the Fair Tax Treatment for Manufactured Home Communities (H.R. 3399)--help residents of mobile home parks buy the land and run their community as a cooperative.

Let's bring those bills to the House floor. Not this bill which would steer borrowers to high-cost lenders. Now is the time to keep hard fought protections for manufactured home buyers so they re can buy homes they can afford. People who work with manufactured homebuyers oppose this bill. Therefore, I include in the Record letters of opposition from the Housing Assistance Council, Americans for Financial Reform and MHAction.

Protect homebuyers. Oppose H.R. 1699.

Housing Assistance Council,

Washington, DC, November 27, 2017.

Hon. Keith Ellison,

House of Representatives,

Washington, DC.

Dear Representative Ellison: As a national voice for

affordable rural housing, the Housing Assistance Council

(HAC) opposes HR 1699. HR 1699 would eliminate reasonable

safeguards for consumers of manufactured homes put in place

by the Consumer Protection Financial Bureau (CPFB). Examples

include protections against high-interest loans when lower

cost options are available.

Manufactured homes are an important source of housing for

millions of Americans, especially those with low-incomes and

in rural areas. While the physical quality of manufactured

homes continues to progress. the basic delivery system of how

these homes are sold and financed needs improvement. HAC

continues to work with manufactured housing stakeholders--

including the

industry, housing finance entities. and consumer-focused

groups--to improve the system, starting with improved data

collection. Moreover, ``Duty to Serve'' requirements of

Fannie Mae and Freddie Mac represent an important infusion of

capital into the manufactured housing market. HR 1699's

enactment could undermine such progress.

As housing costs rise for poor rural Americans--exacerbated

by recent natural disasters--it is important that Congress

seek opportunities to make housing for the rural poor more

accessible and fair. HR 1699 is a step in the opposite

direction.

Sincerely,

David Lipsetz,

Executive Director.

Bill Text

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Introduced in HouseIssued July 19, 2017

115th CONGRESS

1st Session

H. R. 3296

IN THE HOUSE OF REPRESENTATIVES

July 19, 2017

Mr. Ellison introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to allow a business credit for gain from the sale of real property for use as a manufactured home community, and for other purposes.

Short title

This Act may be cited as the Frank Adelmann Manufactured Housing Community Sustainability Act.

Findings

The Congress finds that—

(1)

more than 17 million people live in manufactured homes, benefitting from high-quality affordable homes that can provide them stability;

(2)

owners of manufactured homes are disproportionately low-income households: in 2013, the median annual household income for those living in manufactured housing was $28,400;

(3)

about 75 percent of manufactured home households earn less than $50,000;

(4)

over 10 percent of United States veterans live in manufactured homes;

(5)

in the late 1990s, manufactured housing represented two-thirds of the new affordable housing produced in the United States, and it remains the largest source of unsubsidized affordable housing in the country;

(6)

as of 2015, the average cost per square foot for a new manufactured home was $48, less than half the $101 per square foot of the structure-only cost of a new site-built home;

(7)

in 2009, 43 percent of all new homes that sold for less than $150,000 were manufactured homes;

(8)

manufactured homes accounts for 23 percent of new home sales under $200,000;

(9)

more than 50,000 manufactured home communities, or mobile home parks, exist throughout the United States;

(10)

more than 2.9 million manufactured homes are placed in manufactured home communities;

(11)

manufactured home communities provide critical affordable housing but receive very little local, State, or Federal funds subsidizing the cost of these homes;

(12)

manufactured home owners in communities may own the home, but they do not own the land under their homes, leaving them vulnerable to rent increases, arbitrary rule enforcement, and even closure of the community if the community owner decides to convert the land to some other use;

(13)

eviction or closure of manufactured home communities is very disruptive to residents who may be unable to pay the thousands of dollars it takes to move their home or even find a new location for their home;

(14)

in the past two decades, a national network of housing providers has helped residents purchase and own the land and manage the community in order to preserve a crucial source of affordable housing;

(15)

nationwide, there are more than 1,000 of these stable, permanent ownership cooperatives or nonprofit-owned developments in more than a dozen States;

(16)

members continue to own their own homes individually and an equal share of the land beneath the entire neighborhood where everyone has a say in the way the resident-owned community is run, and major decisions are made by democratic vote by a member-elected board of directors;

(17)

in New Hampshire, more than 20 percent of manufactured home communities are owned by residents;

(18)

in Vermont, Massachusetts, Rhode Island, Washington, Oregon, and Minnesota, resident-owned cooperatives and nonprofit ownership have flourished;

(19)

nationwide, only 2 percent of all manufactured home communities are resident- or nonprofit-owned;

(20)

owners are frequently reluctant to sell the community because they would prefer to pass the property on to their heirs tax free and avoid capital gains taxes;

(21)

when the owner dies, the heirs frequently sell the community to the highest bidder resulting in displacement for dozens and sometimes hundreds of families; and

(22)

a Federal tax benefit needs to be established to induce owners to sell to residents they have known for decades or to nonprofit organizations in order to preserve the community for years to come.

Tax credit for manufactured home community sale to residents or nonprofit entity

(a)

In general

Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to business related credits) is amended by adding at the end the following new section:

45S.

Manufactured home community sale to residents or nonprofit entity

(a)

Allowance of credit

For purposes of section 38, the manufactured home community sale credit determined under this section for any taxable year is an amount equal to 75 percent of the qualified gain received by the taxpayer during the taxable year.

(b)

Definitions

For purposes of this section—

(1)

Qualified gain

The term qualified gain means gain from the sale or exchange of real property to a qualified manufactured home community cooperative or corporation if—

(A)

the real property is acquired for use as a manufactured home community, and

(B)

the requirements of paragraph (2) are met.

(2)

Requirements

The requirements of this paragraph are met if—

(A)

the seller (or any related person) owned the property for not less than the 2-year period ending before the sale or exchange, and

(B)

the property is transferred subject to a binding covenant that the property will be used as a manufactured home community for not less than 50 years.

(3)

Manufactured home community

The term manufactured home community means a community comprised primarily of manufactured homes used solely for residential purposes and owned by a manufactured home community cooperative or corporation.

(4)

Manufactured home community cooperative or corporation

(A)

In general

The term qualified manufactured home community cooperative or corporation means a cooperative or a nonprofit corporation established pursuant to the laws of the State in which the property used as a manufactured home community is located and which—

(i)

in the case of a community owned by a nonprofit corporation whose membership interests are sold on a nonappreciating basis, has only one class of membership consisting of residents, and

(ii)

in the case of a community owned by a cooperative, has no more than two classes of membership, which includes both members and a tax-exempt organization actively engaged in supporting affordable housing and resident-owned manufactured home communities.

(B)

Governance

An entity shall not be treated as a qualified manufactured home community cooperative or corporation for purposes of subparagraph (A) unless governance of the entity is carried out by members elected to a board of directors with voting structured equitably among all members.

(C)

Member

The term member means—

(i)

an individual—

(I)

has attained the age of 18,

(II)

is entitled by reason of the individual’s membership interest to execute an occupancy agreement with the manufactured home community cooperative nonprofit with respect to one site in the manufactured home community for the purposes of situating a manufactured home owned by the member or, as permitted by the manufactured community cooperative or corporation, the member’s trust or other entity, and

(III)

is a resident of the manufactured home community, and

(ii)

a tax exempt organization.

(5)

Membership interest

The term membership interest means an ownership interest in a manufactured home community cooperative or corporation or a membership interest in a manufactured home community nonprofit corporation.

(6)

Manufactured home

The term manufactured home means a structure, transportable in one or more sections, which—

(A)

in the traveling mode, is 8 body feet or more in width and 40 body feet or more in length, or when erected on site, is 320 square feet or more,

(B)

is built on a permanent chassis and designed to be used as a dwelling (with or without a permanent foundation when connected to required utilities) and includes plumbing, heating, and electrical heating systems, and

(C)

in the case of a structure manufactured after June 15, 1976, is certified as meeting the Manufactured Home Construction and Safety Standards issued under the National Manufactured Housing Construction and Safety Standards Act of 1974 (42 U.S.C. 5401–5426) by the Department of Housing and Urban Development and displays a label of such certification on the exterior of each transportable section.

(c)

Special rules

(1)

Related person

For purposes of subsection (b)(2)(A), a person (hereafter in this subparagraph referred to as the related person) is related to the seller if—

(A)

the related person bears a relationship to the seller specified in section 267(b) or 707(b)(1), or

(B)

the related person and the seller are engaged in trades or businesses under common control (within the meaning of subsections (a) and (b) of section 52).

(2)

Election by both seller and buyer

The credit is allowable under this section only if—

(A)

elected by both the seller and the buyer of the real property and evidenced by an affidavit executed by both parties, and

(B)

the buyer of the real property records the affidavit and the affidavit is referenced in its deed to the real property.

The seller shall elect the credit under this section on its return of tax.

(d)

Tax upon violation of covenant

There is imposed a tax on the buyer for a violation of the covenant specified in subsection (b)(2)(B). The amount of such tax shall be 20 percent of the net proceeds after settlement for the sale or exchange of the real property referred to in subsection (b)(2). For purposes of section 501(a), the tax imposed by this subsection shall not be treated as a tax imposed by this subtitle.

(e)

Regulations

The Secretary shall issue such regulations or other guidance as may be necessary to carry out this section, including the recapture of the tax benefit under this section in any case in which the real property described in subsection (b) is not used as a manufactured home community for at least 50 years.

(b)

Credit allowed as part of general business credit

Section 38(b) of such Code is amended by striking plus at the end of paragraph (35), by striking the period at the end of paragraph (36) and inserting , plus, and by adding at the end the following new paragraph:

(37)

the manufactured home community sale credit determined under section 45S(a).

(c)

Conforming amendments

(1)

Subsection (c) of section 196 of such Code is amended by striking and at the end of paragraph (13), by striking the period at the end of paragraph (14) and inserting , and, and by adding at the end the following new paragraph:

(15)

the manufactured home community sale credit determined under section 45S(a).

(2)

The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:

Sec. 45S. Manufactured home community sale to residents or nonprofit entity.

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2017.