MFH News: MN Mobile Homeowners Rights Violated, Investors Double Down on ‘SKY’ Stock, ND Park Owners Question Special Assessment Tax?
A judge in Burnsville, Minnesota ruled city officials violated the rights of homeowners at a local mobile home park; savvy investors and hedge fund honchos have raised their stakes in Skyline Homes parent company, while a group of North Dakota mobile home park owners seeks accountability regarding their recent special assessment.
It’s Monday, February 13, 2017, and those are your manufactured housing headlines for the past week: Sit back, relax, and let’s drill down and gain some insight on last week’s important stories.
Minnesota Judge Rules City of Burnsville Violated Rights of Mobile Homeowners –
Burnsville, Minnesota is located 15 miles south of downtown Minneapolis. The city of Burnsville violated resident’s rights under federal and state law when it enforced city code violations within a mobile home park in 2015, a Dakota judge ruled Wednesday, according to a report by the Minneapolis StarTribune. The city’s crackdown on carports, awnings and visible trash cans at the Rambush Estates Mobile Home Park was because of ethnic and class prejudice according to District Judge Colleen G. King. The judge cited comments made during a Burnsville City Council work session on June 12, 2012, which was presented to the court as a video exhibit. “Burnsville made an intentional decision to establish a proactive code enforcement process because of the number of ‘ethnically diverse’ people moving into the city and that they “do not know how to take care of their property’ because it is ‘not in their culture,’” King wrote in her 45 page decision. Kathryn Eich, a resident of Rambush Estates who sued on behalf of the residents, was unavailable for comment. Valerie Sims, a lawyer representing the residents, said Eich is thrilled with the ruling. “She always knew what the city was doing was wrong,” Sims said. “She always keeps her property in immaculate condition.” King noted that other residents received similar letters for violations carrying hefty fines related to “carport and attached awnings, exterior storage and trash containers being in view,” The fines were imposed despite the fact that inspectors found no violations, she said. King found that Burnsville enforcement actions in the mobile home park violated a 1974 federal law, which states “manufactured housing plays a vital role in meeting the housing needs of the nation.” and provides “a significant resource for affordable homeownership and rental housing to all Americans.” That law has its own standards related to mobile home construction and safety, as does the state. Because these rules are so extensive, they preempt local standards, Judge King said. Sanctions have not been determined in the case, but a trial will be held to determine damages. Paul Reuvers, the City Attorney said he’s likely to appeal the decision before then.
Investors Raise Stake in Skyline Homes Company –
A number of hedge funds and institutional investors have made changes to their positions in Skyline Co. (NYSEMKT: SKY), including Venator Capital Management LTD. has raised its stake in shares of Skyline by 12.9% during the third fiscal quarter, HoldingsChannel reports. The institutional investor-owned 592,316 shares of the company’s stock after buying an additional 67,824 shares during the period. Skyline makes up approximately 5.3% of Venator Capital Management Ltd’s holdings, making the stock its second largest position. Venator Capital Management Ltd. owned approximately 7.06% of Skyline worth $8,109,000 as of its most recent SEC filing. A number of hedge funds and other institutional investors have also increased their stake in Skyline (SKY) in the last quarter including Morgan Stanley buying an additional 7,496 shares, BlackRock Fund Advisors added 16,371 shares in the third quarter, Northern Trust Corp. added 70 shares, now owning 19,607 shares of the company’s stock. Bridgeway Capital Inc. purchased a new stake in Skyline during the second quarter valued at $189,000. Finally, Vanguard Group Inc. increased its stake in Skyline by 66.1% in the second quarter. Vanguard Group Inc. now owns 233,524 shares of the company’s stock valued at $2,195,000 after buying an additional 92,957 shares during the last quarter. The firm (NYSEMKT: SKY) has a market cap of $94.36 million, a PE ratio of 98.5421 and a beta of 1.69. The firm has a 50-day moving average price of $14.73 and a 200-day moving average price of $12.07. Skyline has a 52 week low of $3.69 and a 52 week high of $17.35. Skyline (NYSEMKT: SKY) lasted posted its earnings results on Thursday, January 12th.The company reported ($0.07) EPS for the quarter. Skyline Corp. earned $64.20 million during the quarter. Skyline Corporation dba Skyline Homes is one of the oldest and most respected producers of quality value oriented manufactured homes, modular homes and park model homes and Rv’s in the nation, and for sale by a large network of authorized independent retailers and communities throughout the United States and Canada. Skyline Homes has a long-held reputation for customer satisfaction with thousands of happy families residing in homes produced by Skyline Homes building facilities in every region of the country.
Bismarck Park Owners Seek Tax Equity –
A group of Bismarck, North Dakota mobile home park owners are petitioning the city commission for the creation of a task force to keep park living affordable, reports the Bismarck Tribune. “These homes represent the most affordable unsubsidized housing in Bismarck,” a letter from the park operators read. “Unfortunately, Bismarck’s city policies unfairly burden the affordability of manufactured homes and impose on these homeowners costs which other homeowners are not asked to bear.” The group represents 90 percent of the mobile home units in the city. They say the Burleigh County Tax Equalization office shows that there are 3,110 mobile homes in Bismarck. Using the city’s most recent population estimates, about 10 percent of the population lives in mobile homes. Meanwhile, Myron Atkinson owner of the 362-home Tatley Meadows and spokesman for the group said the manner in which costs for water, sewer, property taxes and other services are calculated to a higher price per unit for those living in mobile home communities than those in other residential properties. Atkinson said some progress was made with special assessments last year but there are still discrepancies. Mobile home owners used to be specially assessed at 200 percent of a special assessment basis, compared to 100 percent for a single-family dwelling. That percentage has been reduced to 150 percent, but it’s still unequal. “We want our people treated like every other homeowner,” said Atkinson, pointing out that park operators are expecting a sudden change in sanitary sewer rates expected to go from $2.56 per unit to $2.92 per unit. “It’s going to make a real difference in what a rent increase is going to be.” he said. For his park, Atkinson estimates a $15 per month increase in rent just due to the sanitary sewer assessment. Atkinson estimates park lot rent in Bismarck averages around $340 to $350 per month. With the help of Capital Credit Union, he ran some numbers on housing costs for mobile homes. An existing 15 to 20-year-old home could be purchased for about $50,000. With good credit score and a 10 percent down payment, interest would be about 7 percent. That means a $390.00 per month house payment, about $84 in insurance, $35 in taxes and if you live in his park, about $335 in rent. This comes to $840 a month. Atkinson said the group hasn’t heard from city commissioners on its request but hope to receive some response soon. He said, ideally, the task force would include park residents, as well as park operators, working with the city to find solutions.