The story plays out across America: In small towns and housing co-operatives, democracy and government usually ends up in the hands of a few motivated and outspoken souls. Residents go with the flow - and stay silent in order to avoid conflict, rejection or personal consequences for their opinions, even when they believe something is wrong, according to mobile home co-op residents and housing authorities.
Members who are elected to boards often stay in power for years, unchallenged – often because nobody runs in elections to unseat them. Unpleasant duties such as extracting rent from your neighbors ends up taking a back seat. Over years, co-ops can sink into financial decline when members don’t pay close attention or vote in new boards to manage things. Over time, the community isn’t as friendly, fair or financially sound.
“Generally, in parks that are resident-owned, there’s infighting, there’s playing favorites, and there’s no one who is independently managing the co-op to make sure everyone is treated the same,” and challenges often resemble what can happen in any homeowners’ association, said Skyler Leichty, co-founder of MH Park Advisors in Dallas, which manages 30 mobile home parks in Texas, Kentucky and Florida. Rent collection gets sticky when a neighbor is doing the collecting - which feels unfriendly to the person who is behind on the rent. Park management morphs into a prickly cousin: personality management.
“Nobody wants to be the jerk to their neighbor,” said Megan Hanson, who served on the board of Old Lake Shore Cooperative in 2017-2018, and as operations manager. “When you’re dealing with neighbors, it becomes personal.”
“People are people, whatever age they are. I can see how easily it can turn into an ugly situation,” said Leichty at MH Park Advisors. Issues can flare up, smolder and spark ill-will that simmers for years.“It’s definitely a benefit for someone to own the land, own the home, and have control over monthly payments,” said Leichty. “But how do we make it so everyone likes living there?”
Sometimes the answer is hiring an outside manager to be an independent voice of reason and the impartial enforcer of rules. The financial policing and “friendly reminders” to pay “feel less personal coming from a management company,” Leichty said.
After finances slip, “It can be a challenge to get the parks stabilized, and where they need to be” with proper reserves in the bank, he said. Budgeting gets tough when residents balk at raising rents, even low ones from bygone eras, and money to pay for daily operations and maintenance ends up being siphoned from capital improvement reserves. “Sometimes, there’s no way residents can make it happen financially,” said Leichty, and housing co-operatives become vulnerable to losing their status as co-ops.
"You can't keep borrowing from Peter to pay Paul," said Deb Richardson, a former board member at Lakes Region Mobile Home Village Cooperative in Gilford. At that co-op, one of several on Old Lake Shore Road, self-rule has been marred by discord and financial uncertainties, and suspicions of improprieties by board members who have stayed in control too long.
““Now, the only way to get out of our financial problems is to get a fourth mortgage,"said Sylvia Dion, an LRMHVC resident for 34 years, since before the park became resident-run. The new board "wants to refinance so they can do projects that should have been done a long time ago,” Dion said. “A lot of us haven’t slept (well) in over a year." Some co-op members, including Dion, who served on the board in 2019, believe independent management would solve many of the co-op’s problems, but that hasn't been proposed by the board now in power.
When finances get shaky, outside management can boost rent collection, which can make it easier for mobile home co-ops to refinance high interest rate loans – with lower-cost money that can simultaneously pay for infrastructure improvements that have been postponed – sometimes without raising rents.
At nearby Old Lake Shore Cooperative in Gilford, outside financial management was brought in when the co-ops became financially unstable and it was at risk of losing its co-op status. After a property management firm based in Rochester was hired, rent collection increased, the look and care of the park improved, and the positive changes enabled it to refinance it’s high-risk rate loan from ROC-NH with a lower-cost commercial bank loan. With the money it saved, the co-op is now paving its roads – an infrastructure improvement that had been delayed for years.
Having a financial management company may be expensive, depending on what’s involved, “but it’s the only way to go,” said Rick DuBois, a resident and former board member at Old Lake Shore Cooperative. “In the end, everybody pays for it,” he said, but the cost of management is divided equally and added to rents - which, so far, haven’t had to be raised at OSLC.
Where do mobile home co-op residents turn when self-management goes awry? It’s a problem, because there’s no direct oversight other than specific requirements by mortgage lenders, which stay mostly hands-off until things deteriorate to a risk of foreclosure.
The New Hampshire Manufactured Housing Board receives four to eight complaints a year from residents at all types of mobile home parks, claiming that a by-laws is unreasonable or illegal, and the board reviews those cases and makes decisions at meetings every two to three months. But the board only handles problems with by-laws, not mismanagement or financial shortfalls.
The consumer protection unit of New Hampshire Attorney General’s office may become involved if co-op residents believe they were lead into buying their parks by false marketing materials, high-pressure presentations and promises of services which were not provided. But when it comes to mismanagement by co-op members who serve on the board, or the operations of mortgage lenders involved with the parks, the NH Department of Justice has no jurisdiction. A lender may be a non-profit, but the co-ops are private entities. They have legal and financial responsibilities to their members, and charges of mismanagement by co-op boards are civil matters, said Tom Donovan, the assistant attorney general who heads the NH Attorney General's charitable trust unit.
“People who are board officers have a fiduciary duty to people who in that organization,” said Stephanie Bray, an attorney at New Hampshire Legal Assistance who specializes in real estate issues. Co-op members can pool resources to hire a lawyer to represent them. But cost can be a stumbling block for those with limited funds.
Help from New Hampshire Legal Assistance may be an option. NHLA’s services are typically limited to individuals who have been evicted or are in danger of losing their homes, and to people who are being harassed or discriminated in housing for civil rights reasons such as race, gender, age or disability, which can include a chronic medical condition, said Bray. In most cases, applicants must be income-eligible. NHLA's legal advice and referral center screens applicants at 1-800-639-5290. The direct number for the Concord office is 603-223-9750. More information can be found at nhlegalaid.org.
A better option may be help through Modest Means, a program of the New Hampshire Bar Association, which can be reached at 603-715-3290. Participating attorneys offer their services for free or reduced rates, depending on the issue and applicant's resources. For the NHBA's lawyer referral service, call 603-229-0002, or go to nhbar.org.
The Sunshine Project is underwritten by grants from the Endowment for Health, New Hampshire’s largest health foundation, and the New Hampshire Charitable Foundation. Roberta Baker can be reached by email at Roberta@laconiadailysun.com