Florida Manufactured Housing Ass'n, Inc. v. Cisneros

• Citation: 53 F.3d 1565
• Decision Date: 12 June 1995
• Docket Number: No. 94-2307,94-2307
• Parties: FLORIDA MANUFACTURED HOUSING ASSOCIATION, INC., Homes of Merit, Inc., Jacobsen Manufacturing, Inc., and Nobility Homes, Inc., Petitioners, v. Henry G. CISNEROS, Secretary of the United States Department of Housing and Urban Development, Respondent.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1565

53 F.3d 1565

FLORIDA MANUFACTURED HOUSING ASSOCIATION, INC., Homes of Merit, Inc., Jacobsen Manufacturing, Inc., and Nobility Homes, Inc., Petitioners, v. Henry G. CISNEROS, Secretary of the United States Department of Housing and Urban Development, Respondent.

No. 94-2307.

United States Court of Appeals Eleventh Circuit.

June 12, 1995.

Barbara C. From, Parker, Skelding, Labasky & Corry, Tallahassee, FL, James vanR. Springer, Dickstein, Shapiro & Morin, Washington, DC, for petitioners.

Bruce G. Forrest, U.S. Dept. of Justice, Washington, DC, for respondent.

Mark S. Weiss, Roberts & Weiss, Woodbridge, VA, for amicus Ass'n for Regulatory Reform.

Robert E. Sasser, James D. Hamlett, Sasser & Littleton, Montgomery, AL, for amicus Alabama Manufactured Housing Institute, Inc.

William A. Pyle, Pyle, Dreher, Mills & Dye, P.A., Ridgeland, MS, for amicus Mississippi Manufactured Housing Ass'n.

Dick W. Wilson, Jr., Peterson, Dillard, Young, Asselin, Powell & Wilson, Atlanta, GA, for amicus Georgia Manufactured Housing Ass'n, Inc.

Petition for Review of an Order of the U.S. Department of Housing and Urban Development.

Before ANDERSON and CARNES, Circuit Judges, and RONEY, Senior Circuit Judge.

CARNES, Circuit Judge:

This case involves regulations promulgated under the National Manufactured Housing Construction and Safety Standards Act of 1974, 42 U.S.C. Secs. 5401-5426 ("the Manufactured Housing Act" or "the Act"). After the tremendous damage caused by Hurricane Andrew in 1992, the Department of Housing and Urban Development ("HUD"), pursuant to the Act, revised its wind resistance standards for manufactured homes. The Florida Manufactured Housing Association, Inc. and the other petitioners in this case (referred to collectively as "the manufacturers") challenge several aspects of that rulemaking. They contend (1) that the agency did not adequately consult with its Advisory Council as required by the Act; (2) that the agency misinterpreted the meaning of "cost" as used in the statutory criteria; and (3) that the new wind standards are arbitrary and capricious for four different reasons. We hold that the manufacturers' arguments are without merit and deny their request that we set aside the regulations and that we remand to the agency for further proceedings.

I. BACKGROUND

A. STATUTORY FRAMEWORK

As declared by Congress, the purposes of the Manufactured Housing Act are to "reduce the number of personal injuries and deaths and the amount of insurance costs and property damage resulting from manufactured home accidents and to improve the quality and durability of manufactured homes." 42 U.S.C.A. Sec. 5401 (West 1983). In order to achieve these objectives, the Act authorizes the Secretary of HUD to "establish by order appropriate Federal manufactured home construction and safety standards. Each such Federal manufactured home standard shall be reasonable and shall meet the highest standards of protection, taking into account existing State and local laws relating to manufactured home safety and construction." 42 U.S.C.A. Sec. 5403(a) (West 1983). The construction and safety standards issued under the Act supersede state and local standards for manufactured homes. 42 U.S.C.A. Sec. 5403(d) (West 1983); Scurlock v. City of Lynn Haven, Fla., 858 F.2d 1521, 1524-25 (11th Cir.1988). The regulations are issued under the rulemaking procedures mandated by the Administrative Procedure Act, 5 U.S.C. Sec. 553. See 42 U.S.C.A. Sec. 5403(b) (West 1983).

When promulgating manufactured housing standards, the Act directs the Secretary of HUD to:

(1) consider relevant available manufactured home construction and safety data, including the results of the research, development, testing, and evaluation activities conducted pursuant to this chapter, and those activities conducted by private organizations and other governmental agencies to determine how to best protect the public;

(2) consult with such State or interstate agencies (including legislative committees) as he deems appropriate;

(3) consider whether any such proposed standard is reasonable for the particular type of manufactured home or for the geographic region for which it is prescribed;

(4) consider the probable effect of such standard on the cost of the manufactured home to the public; and

(5) consider the extent to which any such standard will contribute to carrying out the purposes of this chapter.

42 U.S.C.A. Sec. 5403(f) (West 1983). Pursuant to this statutory authority, HUD has promulgated standards covering "all equipment and installations in the design, construction, transportation, fire safety, plumbing, heat-producing and electrical systems of manufactured homes which are designed to be used as dwelling units." 24 C.F.R. Sec. 3280.1 (1994).

B. THE RULEMAKING PROCESS

Before HUD issued the regulations challenged in this appeal, the agency's wind resistance standards for manufactured homes divided the United States into two wind zones: a "standard" wind zone and a "hurricane-resistive" wind zone. Under those regulations, manufactured homes in the hurricane-resistive zone were required to withstand winds of approximately 80 miles per hour. The devastation caused by Hurricane Andrew in August of 1992 convinced HUD that the existing standards were inadequate. According to HUD, 97% of all manufactured homes in Dade County were destroyed, compared with 11% of single-family, non-manufactured homes. In Florida and Louisiana, 11,213 manufactured houses were destroyed and 3,016 suffered major damage. Approximately 36% of all housing units destroyed by Hurricane Andrew were manufactured homes. Moreover, the wind turned parts of some manufactured homes into flying missiles, causing additional damage to other structures. Manufactured Home Construction and Safety Standards on Wind Standards, 59 Fed.Reg. 2456, 2457 (1994) ("Final Rule"). Damage to manufactured homes from high winds is "primarily in the form of roof failure, loss of roof diaphragm material, connection failures, and tiedown/foundation failures." Id.

After Hurricane Andrew, HUD initiated field investigations in Florida as part of a general review of manufactured home standards. The investigations revealed various deficiencies in manufactured homes' resistance to wind storms, such as inadequate connections between roofs, walls, and floors, and between exterior roof and wall coverings and supporting sheathing or framing. Those deficiencies led to other problems, including water damage, damage from increased internal pressures, and missile damage to other structures.

In addition to HUD's investigations, the National Institute of Standards and Technology issued a report ("National Standards Report") comparing the wind protection provisions of selected codes and standards. In assessing the impact of Hurricane Andrew on manufactured housing, the National Standards Report found that:

Damage to manufactured homes ranged from loss of roofing to total destruction.... Commonly observed failures include loss of roof membranes and blow-off of roof sheathing, failure of uplift straps at truss-to-wall connections where staple crowns pulled through the strap material, loss of cladding on endwalls and near corners where large negative (suction) pressures develop, loss of add-ons with resulting missile damage and damage to the parent unit at points of attachment, complete separation of superstructure from floor and underframe, and loss of the complete unit due to failure of tiedown straps or withdrawal of soil anchors.

The National Standards Report recommended that HUD use the wind load requirements of the American Society of Civil Engineers' model standard, ASCE 7-88, as the basis for the new rules.

On April 14, 1993, HUD published a Notice of Proposed Rulemaking, proposing that the manufactured home standards be amended to conform with the ASCE 7-88 standard, 58 Fed.Reg. 19,536 (1993) ("Notice of Rulemaking"), which is what the National Standards Report had recommended. The stated goal of the proposed standards was to "increase the safety of manufactured homes in areas where wind-induced damage is a special hazard." Id. at 19,536. In order to have the new standards in place by the 1993 hurricane season, the Notice of Rulemaking indicated that HUD would use an abbreviated thirty-day public comment period for the proposed rules. However, after that deadline passed, HUD subsequently extended the comment period for another thirty days, because the agency decided that the new standards could not be implemented in time for the 1993 hurricane season. HUD received over one thousand comments from the public, although most were duplicative or identical form letters. Comments submitted by the manufacturers, as well as others, raised a number of objections to the proposed standards, including criticisms of the increased costs and predictions of deleterious effects on the industry and on low-income families.

The Manufactured Housing Act also requires that HUD, before establishing, amending, or revoking any manufactured housing standard, must consult "to the extent feasible" with the National Manufactured Home Advisory Council ("Advisory Council"). 42 U.S.C.A. Sec. 5404(b) (West 1983). At first, HUD determined that it was not feasible to consult with the Advisory Council because of the agency's expedited schedule; however, after it extended the comment period, HUD did consult with the Advisory Council, which it convened for a two-day session in July of 1993. At that meeting, the Advisory Council adopted a resolution calling for more studies, and more public input, and recommending that the Council "be reconvened to review the public comments and the analysis and studies by HUD" that the Council called for. HUD did not reconsult the Advisory Council before the Final Rule was published.

C. THE FINAL RULE

The Final Rule was published in the Federal Register on January 14, 1994. Under the Final Rule regulations, the...