[House Report 118-424]
[From the U.S. Government Publishing Office]


118th Congress }                                              { Report
                        HOUSE OF REPRESENTATIVES
 2d Session    }                                              { 118-424

======================================================================



 
             AFFORDABLE HOUSING OVER MANDATING EFFICIENCY  
                            STANDARDS ACT

                                _______
                                

 March 12, 2024.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

     Mrs. Rodgers of Washington, from the Committee on Energy and 
                  Commerce, submitted the following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                        [To accompany H.R. 6421]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 6421) to prohibit the Secretary of Energy from 
enforcing energy efficiency standards applicable to 
manufactured housing, and for other purposes, having considered 
the same, reports favorably thereon without amendment and 
recommends that the bill do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     2
Committee Action.................................................     3
Committee Votes..................................................     4
Oversight Findings and Recommendations...........................     6
New Budget Authority, Entitlement Authority, and Tax Expenditures     6
Congressional Budget Office Estimate.............................     6
Federal Mandates Statement.......................................     7
Statement of General Performance Goals and Objectives............     7
Duplication of Federal Programs..................................     7
Related Committee and Subcommittee Hearings......................     7
Committee Cost Estimate..........................................     8
Earmark, Limited Tax Benefits, and Limited Tariff Benefits.......     8
Advisory Committee Statement.....................................     8
Applicability to Legislative Branch..............................     8
Section-by-Section Analysis of the Legislation...................     8
Changes in Existing Law Made by the Bill, as Reported............     8
Minority Views...................................................    11

                          
                          Purpose and Summary

    H.R. 6421, the ``Affordable Housing Over Mandating 
Efficiency Standards Act'' or the ``Affordable HOMES Act,'' was 
introduced by Representative Bucshon (R-OH) on November 15, 
2023. This legislation would repeal section 413 of the Energy 
Independence and Security Act (EISA) of 2007 relating to energy 
efficiency standards related to manufactured Housing. The 
legislation would also vitiate the final rule titled ``Energy 
Conservation Program: Standards for Manufactured Housing'' 
published in Federal Register on May 31, 2022.

                  Background and Need for Legislation

    Under current law, both the U.S. Department of Housing and 
Urban Development (HUD) and the Department of Energy (DOE) have 
authority to impose energy efficiency mandates on manufactured 
housing. In 1974, Congress passed the Manufactured Housing 
Construction Safety Standards Act of 1974 (MHCSS), which 
designated HUD as the primary agency with authority over 
manufactured home construction standards, known as the ``HUD 
Code.'' It delegated to HUD with preemptive authority to 
regulate energy efficiency standards for manufactured housing 
and specifically requires that the energy conservation 
standards be cost-effective and take into consideration the 
design and factory construction techniques of manufactured 
homes.\1\ Congress's goal in passing MHCSS was to balance 
safety, efficiency, and housing costs for Americans.
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    \1\42 U.S.C. Sec. 5403(g).
---------------------------------------------------------------------------
    In 2007, Congress passed the EISA, which included an 
amendment that required the DOE to establish energy efficiency 
standards for manufactured housing based on the most recent 
version of the International Energy Conservation Code (IECC) in 
contravention of the MHCSS.\2\
---------------------------------------------------------------------------
    \2\42 U.S.C. Sec. 17071.
---------------------------------------------------------------------------
    The Committee finds that the IECC standards are overly 
prescriptive and incompatible with the HUD code. The IECC 
standards are based on site-built homes, where the builder 
designs the home to a specific locale and conditions of that 
locale. In contrast, manufactured housing producers and 
retailers do not ultimately know the home's ultimate location 
and orientation, and therefore are unable to conform with the 
IECC requirements. The Committee additionally finds that unlike 
HUD, the DOE lacks the requisite knowledge and expertise to 
establish regulations that adequately consider the unique 
attributes of factory-built housing.
    Pursuant to EISA authorities, the DOE published a final 
rule titled ``Energy Conservation Program: Energy Conservation 
Standards for Manufactured Housing'' published in the Federal 
Register on May 31, 2022.\3\ The Committee finds significant 
problems with DOE's efficiency standards for manufactured 
homes: they rely on the IECC, which is incompatible with off-
site built homes; they lack testing, compliance, and 
enforcement capabilities; and they create conflicting sets of 
energy standards between DOE and HUD.
---------------------------------------------------------------------------
    \3\87 Fed. Reg. 32728.
---------------------------------------------------------------------------
    If the DOE standards are enforced, there will be two 
different sets of manufactured home energy standards which 
would create a significant compliance burden for manufactured 
home manufacturers, which will discourage the production of new 
affordable homes, thereby threatening the supply of these homes 
and increasing cost. This will add to our nation's existing 
housing affordability crisis as manufactured homes are the most 
affordable homeownership option. In 2022, the average price of 
a manufactured home was $127,250, while the average price of a 
site-built home was $413,000. The average income of a 
manufactured home buyer was around $35,000, while the average 
income of a site-built homebuyer was over $100,000.\4\
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    \4\2023 Manufactured Housing Facts Industry Overview, The 
Manufactured Housing Institute (June 2023), 2023-Industry-Overview.pdf 
(manufacturedhousing.org).
---------------------------------------------------------------------------
    To support housing affordability and improve energy 
efficiency, this Committee finds it necessary to halt the 
implementation of DOE's flawed final rule. The Committee also 
finds it necessary to clarify HUD's primacy over the regulation 
of manufactured housing by rescinding the provision from EISA 
that gives DOE the duplicative authority to establish energy 
efficiency standards for manufactured housing.

                            Committee Action

    On September 13, 2023, the Subcommittee on Energy, Climate, 
and Grid Security held a hearing related to H.R. 6421. The 
title of the hearing was ``Keeping the Lights On: Enhancing 
Reliability and Efficiency to Power American Homes.''
    During this hearing, the DOE testified on the agency's 
process for implementing and reviewing energy efficiency and 
conservation standards. Energy efficiency experts also 
testified as to how these standards impact regulated 
industries. The Subcommittee received testimony from:
           Gene Rodrigues, Assistant Secretary for 
        Electricity, Office of Electricity, U.S. Department of 
        Energy;
           David Ortiz, Director, Office of Electric 
        Reliability, Federal Energy Regulatory Commission;
           Kevin Messner, Executive Vice President and 
        Chief Policy Officer, Association of Home Appliance 
        Manufacturers;
           B. Robert Paulling, President and Chief 
        Executive Officer, Mid-Carolina Electric Cooperative on 
        behalf of the National Rural Electrical Cooperatives 
        Association;
           Ben Lieberman, Senior Fellow, Competitive 
        Enterprise Institute; and
           Andrew deLaski, Executive Director, 
        Appliance Standards Awareness Project.
    On October 24 and 25, 2023, the Subcommittee on Energy, 
Climate, and Grid Security met in open markup session and 
forwarded a discussion draft titled ``Affordable Housing Over 
Mandating Efficiency Standards Act'' or the ``Affordable HOMES 
Act,'' without amendment, to the full Committee by a record 
vote of 15 yeas and 12 nays.
    On December 5 and 6, 2023, the full Committee on Energy and 
Commerce met in open markup session and ordered H.R. 6421, 
without amendment, favorably reported to the House by a record 
vote of 24 yeas and 20 nays.

                            Committee Votes

    Clause 3(b) of rule XIII requires the Committee to list the 
record votes on the motion to report legislation and amendments 
thereto. The following reflects the record votes taken during 
the Committee consideration:

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                 Oversight Findings and Recommendations

    Pursuant to clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII, the Committee held a hearing and made findings that 
are reflected in this report.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    Pursuant to clause 3(c)(2) of rule XIII, the Committee 
finds that H.R. 6421 would result in no new or increased budget 
authority, entitlement authority, or tax expenditures or 
revenues.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII, the following is 
the cost estimate provided by the Congressional Budget Office 
pursuant to section 402 of the Congressional Budget Act of 
1974:

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    H.R. 6421 would repeal the authority for the Department of 
Energy (DOE) to establish energy conservation standards for 
manufactured housing and would prohibit DOE from implementing 
the rule, ``Energy Conservation Program: Energy Conservation 
Standards for Manufactured Housing,'' as published in the 
Federal Register in May 2022.\5\ Manufacturers must comply with 
that rule at different times depending on the type of home they 
manufacture; however, CBO expects none would be required to 
comply until 2025.
---------------------------------------------------------------------------
    \5\See Office of Energy Efficiency and Renewable Energy, Department 
of Energy, ``Energy Conservation Program: Energy Conservation Standards 
for Manufactured Housing,'' Final Rule, 87 Fed. Reg. 32728 (May 31, 
2022), http://tinyurl.com/mrtecmx2.
---------------------------------------------------------------------------
    Under current law, manufacturers that do not comply with 
DOE's standards for manufactured housing would be liable for 
civil penalties, which are recorded in the budget as revenues. 
Accordingly, enacting the bill could reduce revenues if fewer 
civil penalties were collected. Based on the number of cases 
likely to be affected, CBO estimates that any effect under the 
bill would reduce revenues by an insignificant amount over the 
2024-2034 period.
    CBO estimates that implementing the bill would reduce 
spending subject to appropriation by less than $500,000 because 
the bill would lessen DOE's requirement to establish energy 
conservation standards. Any reduction in spending would depend 
on future appropriations being reduced by the estimated amount.
    The CBO staff contact for this estimate is Aaron Krupkin. 
The estimate was reviewed by H. Samuel Papenfuss, Deputy 
Director of Budget Analysis.

                                       Phillip L. Swagel,
                           Director, Congressional Budget Office.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

         Statement of General Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII, the general 
performance goal or objective of this legislation is to ensure 
housing affordability by repealing duplicative regulation of 
manufactured housing by rescinding the provision from EISA, 
which grants DOE the duplicative authority to establish energy 
efficiency standards for manufactured housing.

                    Duplication of Federal Programs

    Pursuant to clause 3(c)(5) of rule XIII, no provision of 
H.R. 6421 is known to be duplicative of another Federal 
program, including any program that was included in a report to 
Congress pursuant to section 21 of Public Law 111-139 or the 
most recent Catalog of Federal Domestic Assistance.

              Related Committee and Subcommittee Hearings

    Pursuant to clause 3(c)(6) of rule XIII, the following 
related hearing was used to develop or consider H.R. 6421:
           On September 13, 2023, the Subcommittee on 
        Energy, Climate, and Grid Security held a hearing 
        related to H.R. 6421. The title of the hearing was 
        ``Keeping the Lights On: Enhancing Reliability and 
        Efficiency to Power American Homes.''
          During this hearing, the DOE testified on the 
        agency's process for implementing and reviewing energy 
        efficiency and conservation standards. Energy 
        efficiency experts also testified as to how these 
        standards impact regulated industries. The Subcommittee 
        received testimony from:
                   Gene Rodrigues, Assistant 
                Secretary for Electricity, Office of 
                Electricity, U.S. Department of Energy;
                   David Ortiz, Director, Office of 
                Electric Reliability, Federal Energy Regulatory 
                Commission;
                   Kevin Messner, Executive Vice 
                President and Chief Policy Officer, Association 
                of Home Appliance Manufacturers;
                   B. Robert Paulling, President 
                and Chief Executive Officer, Mid-Carolina 
                Electric Cooperative on behalf of the National 
                Rural Electrical Cooperatives Association;
                   Ben Lieberman, Senior Fellow, 
                Competitive Enterprise Institute; and
                   Andrew deLaski, Executive 
                Director, Appliance Standards Awareness 
                Project.

                        Committee Cost Estimate

    Pursuant to clause 3(d)(1) of rule XIII, the Committee 
adopts as its own the cost estimate prepared by the Director of 
the Congressional Budget Office pursuant to section 402 of the 
Congressional Budget Act of 1974.

       Earmark, Limited Tax Benefits, and Limited Tariff Benefits

    Pursuant to clause 9(e), 9(f), and 9(g) of rule XXI, the 
Committee finds that H.R. 6421 contains no earmarks, limited 
tax benefits, or limited tariff benefits.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

             Section-by-Section Analysis of the Legislation


Section 1. Short title

    Section 1 provides the Act may be cited as the ``Affordable 
Housing Over Mandating Efficiency Standards Act'' or the 
``Affordable HOMES Act.''

Section 2. Prescribing new or amended energy conservation standards

    Section 2(a) strikes section 413 of the Energy Independence 
and Security Act of 2007, which directs the DOE to establish 
energy standards for manufactured homes.
    Section 2(b) vitiates the final rule titled ``Energy 
Conservation Program: Energy Conservation Standards for 
Manufactured Housing'' published by the DOE on May 31, 2022.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets and 
existing law in which no change is proposed is shown in roman):

              ENERGY INDEPENDENCE AND SECURITY ACT OF 2007


SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Energy 
Independence and Security Act of 2007''.
  (b) Table of Contents.--The table of contents of this Act is 
as follows:

Sec. 1. Short title; table of contents.
     * * * * * * *

        TITLE IV--ENERGY SAVINGS IN BUILDINGS AND INDUSTRY

Sec. 401. Definitions.

               Subtitle A--Residential Building Efficiency

Sec. 411. Reauthorization of weatherization assistance program.
     * * * * * * *
[Sec. 413. Energy code improvements applicable to manufactured 
            housing.]

           *       *       *       *       *       *       *


                 TITLE IV--ENERGY SAVINGS IN   
                   BUILDINGS AND INDUSTRY

           *       *       *       *       *       *       *


Subtitle A--Residential Building Efficiency

           *       *       *       *       *       *       *


[SEC. 413. ENERGY CODE IMPROVEMENTS APPLICABLE TO MANUFACTURED 
            HOUSING

  [(a) Establishment of Standards.--
          [(1) In general.--Not later than 4 years after the 
        date of enactment of this Act, the Secretary shall by 
        regulation establish standards for energy efficiency in 
        manufactured housing.
          [(2) Notice, comment, and consultation.--Standards 
        described in paragraph (1) shall be established after--
                  [(A) notice and an opportunity for comment by 
                manufacturers of manufactured housing and other 
                interested parties; and
                  [(B) consultation with the Secretary of 
                Housing and Urban Development, who may seek 
                further counsel from the Manufactured Housing 
                Consensus Committee.
  [(b) Requirements.--
          [(1) International energy conservation code.--The 
        energy conservation standards established under this 
        section shall be based on the most recent version of 
        the International Energy Conservation Code (including 
        supplements), except in cases in which the Secretary 
        finds that the code is not cost-effective, or a more 
        stringent standard would be more cost-effective, based 
        on the impact of the code on the purchase price of 
        manufactured housing and on total life-cycle 
        construction and operating costs.
          [(2) Considerations.--The energy conservation 
        standards established under this section may--
                  [(A) take into consideration the design and 
                factory construction techniques of manufactured 
                homes;
                  [(B) be based on the climate zones 
                established by the Department of Housing and 
                Urban Development rather than the climate zones 
                under the International Energy Conservation 
                Code; and
                  [(C) provide for alternative practices that 
                result in net estimated energy consumption 
                equal to or less than the specified standards.
          [(3) Updating.--The energy conservation standards 
        established under this section shall be updated not 
        later than--
                  [(A) 1 year after the date of enactment of 
                this Act; and
                  [(B) 1 year after any revision to the 
                International Energy Conservation Code.
  [(c) Enforcement.--Any manufacturer of manufactured housing 
that violates a provision of the regulations under subsection 
(a) is liable to the United States for a civil penalty in an 
amount not exceeding 1 percent of the manufacturer's retail 
list price of the manufactured housing.
  [(e) Cost Sharing.--In carrying out this section, the 
Commercial Director shall require cost sharing in accordance 
with section 988 of the Energy Policy Act of 2005 (42 U.S.C. 
16352).
  [(f) Authorization of Appropriations.--There are authorized 
to be appropriated to carry out this section--
          [(1) $20,000,000 for fiscal year 2008;
          [(2) $50,000,000 for each of fiscal years 2009 and 
        2010;
          [(3) $100,000,000 for each of fiscal years 2011 and 
        2012; and
          [(4) $200,000,000 for each of fiscal years 2013 
        through 2018.]

           *       *       *       *       *       *       *


                             MINORITY VIEWS

    H.R. 6421, the ``Affordable Housing Over Mandating 
Efficiency Standards Act,'' prevents households that live in 
manufactured housing from benefiting from energy efficiency 
standards that are established by energy sector experts. 
Specifically, H.R. 6421 repeals Section 413 of the Energy 
Independence and Security Act of 2007 (EISA) and removes this 
authority from the Department of Energy's (DOE) jurisdiction, 
thus sending energy efficiency standards for manufactured homes 
to another federal agency that does not specialize in energy 
efficiency rulemaking. Additionally, the bill prevents a 
recently finalized energy efficiency standard for manufactured 
housing from taking effect and lowering household utility 
bills. H.R. 6421 also was not supported by expert testimony as 
the bill was not included in a Committee hearing and instead 
sent straight to markup without the necessary witness 
testimony. For these reasons, the Committee Minority strongly 
opposes H.R. 6421.
    Repealing section 413 of EISA will send authority of 
manufactured housing efficiency standards to the Department of 
Housing and Urban Development (HUD). EISA passed in a 
bipartisan fashion, and Congress explicitly directed DOE to 
develop energy efficiency standards for manufactured homes. The 
law directs DOE to base the standards on the most recent 
International Energy Conservation Code (IECC) unless the 
Secretary finds that IECC is not cost-effective or that a more 
stringent standard would be cost-effective.\1\ Prior to the 
passage of EISA, HUD, which was responsible for energy 
standards for manufactured homes, had not updated its energy 
provisions since 1994.\2\ EISA requires DOE to provide notice 
and the opportunity for comment from manufacturers and 
stakeholders, and to consult with the Secretary of HUD on 
energy efficiency standards for manufactured housing.\3\ DOE 
has a rigorous rulemaking process with extensive stakeholder 
engagement and energy sector expert input, and has significant 
experience setting energy efficiency standards. Repealing 
Section 413 of EISA removes this important DOE authority.
---------------------------------------------------------------------------
    \1\Congressional Research Service, Housing Issues in the 118th 
Congress (Jan. 19, 2024) (R47628).
    \2\American Council for an Energy-Efficient Economy, Biden Standard 
for Manufactured Homes Will Leave Low-Income Households with High 
Energy Bills (May 18, 2022) (press release).
    \3\See note 1.
---------------------------------------------------------------------------
    H.R. 6421 also prevents the final rule titled ``Energy 
Conservation Program: Standards for Manufactured Housing'' 
published in the Federal Register on May 31, 2022 from having 
any effect. In May 2022, DOE finalized a court-mandated rule 
adopting energy conservation standards for new manufactured 
homes. The rule will help those living in manufactured housing 
save up to $475 per year on average on their utility bills.\4\ 
Energy costs are about 70 percent higher per square foot in 
manufactured homes compared to site-built homes.\5\ The median 
energy burden of manufactured housing residents is 39 percent 
higher than that of single-family households.\6\ The Committee 
Minority believes it is important to support this standard and 
the crucial savings the standard will provide for these 
households.
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    \4\Department of Energy, DOE Updates Mobile Home Efficiency 
Standards to Lower Household Energy Bills (May 18, 2022) (press 
release).
    \5\See note 2.
    \6\American Council for an Energy-Efficient Economy, How High Are 
Household Energy Burdens? (Sept. 2020).
---------------------------------------------------------------------------
    In the Committee report for H.R. 6421, the Majority cites a 
Subcommittee on Energy, Climate, and Grid Security hearing on 
September 13, 2023 as what was used to develop this bill. This 
hearing, titled ``Keeping the Lights On: Enhancing Reliability 
and Efficiency to Power American Homes'' did not include 
testimony on H.R. 6421 or manufactured homes energy efficiency 
standards. As a result, the Committee did not receive any 
expert witness testimony on the need for the bill or its 
effects. Given the significant impacts of this bill, and the 
striking of a section from a long-standing energy statute, this 
bill should have been given proper consideration and moved 
through regular Committee order, which includes a legislative 
hearing.
    For the reasons stated above, we dissent from the views 
contained in the Committee's report.

                                        Frank Pallone, Jr.,
                  Ranking Member, Committee on Energy and Commerce.

                                  [all]