ELKHART -- U.S. Rep. Joe Donnelly, D-2nd, hopes to give the manufactured housing industry a boost with legislation that would raise Title I loan limits.

In a news conference Friday at Patriot Homes Inc., an Elkhart manufactured housing company, Donnelly noted that the loan limits have not been adjusted for inflation since 1992.

The time period, according to Donnelly, corresponds with a downturn in the industry.

The Granger Democrat also said the House Agriculture Committee plans to hold a hearing at 11 a.m. Wednesday regarding the impact of contaminated feed ingredients on food safety and animal health.

The prime focus of the committee will be to find out how the contamination happened and how to prevent it in the future.

Donnelly said the Federal Housing Administration has gone from insuring 30,000 Title I loans in 1992 to fewer than 1,500 loans in 2006. In Indiana, he said, the number of loans dropped from 377 in 1992 to just four last year.

"What's happened is the Title I loans through FHA have dried up," Donnelly said. He explained that Ginnie Mae and other organizations were stuck with loans in the 1990s because "a lot of the lenders went belly up."

Donnelly said the legislation, introduced Thursday, would allow insurance premiums to be put in place to protect lenders while at the same time increasing the amount of the loans.

"What this is going to do is reopen this market," Donnelly said.

According to Donnelly his bill, the FHA Manufactured Housing Loan Modernization Act of 2007, would fix problems with the current Title I loan program and increase the number of people who are able to buy manufactured housing.

As proposed, the bill would adjust the loan limits upwards from $48,600 to $69,678 and index the limits annually for inflation.

Donnelly said the bill would allow more Americans to achieve the dream of home ownership.

"We're excited. We believe this is something our industry really needed," said Matt Reyenga, vice president of Patriot Homes.

Reyenga said the legislation also should help companies that serve as suppliers to the manufactured housing industry. "If our industry struggles, theirs struggles," he said.

Donnelly said similar legislation will be sponsored in the Senate by U.S. Sen. Evan Bayh, D-Ind.

"We plan to get the bill to the president's desk and get this moving this year," Donnelly said.

Donnelly was one of three Hoosier congressmen who earlier this week asked the Food and Drug Administration about contaminated feed reaching Indiana poultry farms.

Donnelly serves on the Agriculture Committee and on a subcommittee that deals with poultry products.

Donnelly said one question that must be answered is whether the FDA was asleep at the wheel.

Another, he said, is what standards if any, do the Chinese have in place?