Barbour announces Thursday special session on modular housing

Published 7:08 pm Tuesday, October 3, 2006

Gov. Haley Barbour has set a Thursday special session for lawmakers to consider proposals that would reduce the cost of modular home construction on the hurricane-ravaged Mississippi Gulf Coast.

The special session will convene at noon, said Barbour spokesman Pete Smith.

Specifically, lawmakers will be asked to reduce the state’s tax on modular homes by $4,000 to $6,000 per home.

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It is the same proposal that passed the Senate but died in the House Ways and Means Committee when Chairman Percy Watson, D-Hattiesburg, didn’t bring it up for a vote during a special session in August.

Modular houses are made in factories then shipped to home sites and erected on slabs. Because modulars are made to meet local building codes, they’re often allowed to be put in places where mobile homes are excluded from permanent placement.

Barbour said labor supply constraints force the state to encourage alternatives to conventional “stick-built” homes.

Currently, the state tax on modular housing is 7 percent. The tax on mobile homes is 3 percent. Barbour wants to reduce the tax on modular housing to 3 percent, as well.

“The number one priority and challenge in Mississippi caused by Katrina is housing,” Barbour said in a news release. “We must act now to remove barriers to building housing on the Gulf Coast, and reducing the tax on modular homes is a necessary step toward that end.”

Neither Watson or House Speaker Billy McCoy, D-Rienzi, could be reached immediately for comment.

Rep. Mark Formby, R-Picayune, a member of the Ways and Means Committee, said he’s hopeful the proposal will pass in this week’s session.

Formby, a real estate broker in Pearl River County, said he has been contacted by six manufacturers who are interested in opening facilities on to the Gulf Coast to produce modular homes.

“There is a reality that we probably will increase tax revenue by promoting more modular home sales at 3 percent if we pass this bill,” Formby said Monday.

Rep. Frances Fredericks, D-Gulfport, also a member of Ways and Means, said she still has questions about modular housing, particularly if quality is sacrificed for speedy construction.

“I understand you can get them quicker than you can stick built homes,” Fredericks said. “If that’s true, that concerns me because if you’re building the house to the same standard then how are you going to get it quicker?”

Fredericks said she hasn’t heard “an outcry” from residents to move into modular housing.

Last month, lawmakers listened to presentations from some modular home manufacturers at the state Capitol. Lawmakers had questions about everything from plumbing to ceiling height. They also wanted to know if sales tax revenues from modular housing would go to the cities where the houses are made or to the cities where the houses will be located.

“Hopefully, the committee members have gained enough new information. We should be able to go in Thursday afternoon, bring up a bill quickly, pass it quickly and get home by the weekend,” Formby said.

More than 240,000 units of housing were damaged by Katrina statewide, according to Barbour’s office. Various groups assisting in the recovery effort have criticized Barbour for what they say is a lack of programs and incentives to restore affordable housing to the region.

Sen. Charlie Ross, R-Brandon, a member of the Senate Finance Committee, said the tax reduction would complement the governor’s housing grant program that provides up to $150,000 to eligible residents who lost property to Katrina.

“This allows the money that a homeowner has to go a lot further and encourages housing alternatives that’s attractive and can be put in place quickly,” said Ross.