Mobilehome Parks Report - September 2009 by Thomas Kerr

Mobilehome Parks Report™ The Monthly Report Devoted to Investment and Ownership September 2009 ... #349

Legislature passes bill to give weight to resident survey before park is subdivided AB 566 is on Governor’s desk Conversion of a mobilehome park to subdivided lot ownership – and the removal of local rent control – will likely become more difficult in California if Governor Arnold Schwarzenegger signs AB 566 into law. Current law requires a survey of resident support when subdivision of the mobilehome park is proposed. Some cities and counties enacted ordinances providing that unless the survey demonstrates “bona fide” resident support, the subdivision does not have to be approved.

Park owners argue that, under existing law, the survey is simply a step in the process and that local governments cannot take lack of resident support into account when reviewing an application for subdivision. A recent state appellate court decision, Sequoia Park Associates v. County of Sonoma, supports the park owners’ interpretation. (See Mobilehome Parks Report, August 2009.)

However, the appeals court went on to state that “if the Legislature disagrees with our con-

clusion, or if it wishes to grant cities and counties a greater measure of power, it can amend the language” of the current law. And that is what the Legislature did in passing AB 566. The bill that passed the Legislature and now awaits Governor Schwarzenegger’s decision, expressly allows a local government to consider whether the survey of resident support demonstrates “that a majority of residents support the conversion.” Recent Legislative action The version of AB 566 that originally passed the Assembly on a 41-31 vote in late May required that the survey show

Thomas P. Kerr has nearly four decades of experience in government, politics, and the manufactured housing industry. For seven years, he was executive director of Western Mobilehome Association, the largest business organization of mobilehome park owners. Kerr has been a consultant to the California Legislature, the savings and loan industry association, and to developers, park owners, and cities. He is a mobilehome park owner and property manager himself. A licensed real estate broker, consultant, and expert witness, Tom is editor and publisher of Mobilehome Parks Report and other publications on manufactured housing. He has instructed seminars and continuing education programs on manufactured housing for the University of California and the Planners’ Conference of the League of California Cities..

Mobilehome Parks Report™ ❑ September 2009 ❑ Page 2 support for conversion by a majority of residents before the conversion or subdivision could proceed. The Senate instead limited the bill to allow local governments to “consider” whether a majority of residents support the conversion. The first time AB 566 came before the full Senate, it fell two votes short of passage on a 19-19 vote. It was reconsidered the next day, and AB 566 passed the Senate on September 9 by a vote of 21-14. CMPA lobbyist Trent Smith reports one Democrat and one Republican switched from opposition to support of the bill. Timing became crucial for the bill’s supporters at this point, as AB 566 had to return for another vote in the Assembly to approve the amendments made in the Senate. The last day to pass legislation before the Legislature’s scheduled recess was September 11. Proponents were able to round up enough votes for AB 566 in

the waning hours of the legislative session to pass it and send it to the Governor. The Assembly passed AB 566 on a final vote count of 44-28. Once the 41 votes needed for passage were reached, Smith reports several other members added on. It’s up to the Governor Aside from all of the other arguments that proponents and opponents of AB 566 will raise, the basic question Governor Schwarzenegger must decide is: Will another stick be taken from the already-diminished bundle of property rights a mobilehome park owner has? Park owners’ lobbyists will argue that a property owner who no longer wishes to be in the business of renting spaces should not be held “captive” by the residents if he or she chooses to sell the lots. Supporters will argue AB 566 only ensures that the survey requirement originally added by the Legislature in 2002 can inform the local decisionmaking process ra-

ther than serving merely as a box to be checked off a list of procedures. They’ll say that local officials aren’t required to deny approval if a majority of residents don’t support subdivision, but park owners will counter that “politics will rule the day” Will Governor Schwarzenegger veto or sign AB 566? Park owners’ lobbyists will play to the Governor’s perspective as a landlord, property owner, and Republican in asking him to sign AB 566. Park residents’ groups, senior citizen and low income advocates will appeal to Schwarzenegger’s concerns for the underdog in urging a veto. And lobbyists for cities and counties will ask for a veto on the basis of Republican preferences for decisions being made by elected officials closest to the people affected. Schwarzenegger isn’t seen as harboring further political ambitions, so that influence is less.

© 2009 by Thomas P. Kerr, Inc. ❑ 3807 Pasadena Ave., Suite 100 ❑ Sacramento, CA 95821 ❑ (916) 971-0489 Please respect copyrights. You have contracted for an individual subscription. Reproduction is illegal.

Mobilehome Parks Report™ ❑ September 2009 ❑ Page 3 CA Legislature: Other bills await Governor Emergency plans, fire code enforcement, MRL provisions reorganized Three other measures specifically related to mobilehome parks also await veto or signing by Governor Schwarzenegger. He has until October 11 to act on these three bills as well as AB 566. Emergency plans If the Governor signs SB 23, the owner or operator of a mobilehome park or a recreational vehicle park will be required to adopt an emergency preparedness plan. The purpose of the emergency plan is to communicate to residents “essential information about evacuation routes and emergency preparedness.” The Legislature does not intend that a park owner or operator be responsible for evacuating residents during an emergency. The park owner or operator will have to have an emergency plan by September 1, 2010, by either adopting one available from the State

or developing one that is comparable. Fire code enforcement Existing law allows a local agency that has not accepted responsibility for enforcing all of the Mobilehome Parks Act to enforce only specific provisions of the fire prevention regulations adopted by the state Department of Housing & Community Development. The local agency is limited to enforcing regulations concerning fire hydrant systems; water supply; fire equipment access and posting; parking; lot identification; weed, debris, and combustible material abatement; and burglar bars. Eight fire agencies have assumed this limited jurisdiction for fire safety in mobilehome parks: Los Angeles County Fire, Santa Barbara County Fire; fire departments in the cities of Huntington Beach, Mountain View, Sunnyvale, and Torrance; and the Burney Fire Protec-

tion and Ebbetts Pass Fire Districts. If SB 398 becomes law, these eight agencies and any others that have been delegated fire code enforcement by a city or county that is the code enforcement agency, will be able to enforce their own more stringent fire codes. MRL provisions reorganized About a half dozen existing sections of the MRL are grouped into a new Article 4 entitled “Utilities” by SB 111.

We’re told the change will “increase the readability and usefulness of the MRL.” Oh yeah, sure. Mobilehome park attorneys are probably worried the number of calls they receive will drop precipitously. Replacement homes The Governor has already signed SB 804. The measure prohibits park management from requiring a homeowner to use a specific broker, dealer, or other person as an agent in the purchase or installation of a replacement home.

Mobilehome Parks Report™ ❑ September 2009 ❑ Page 4 Thousand Oaks approves subdivision despite resident opposition; Los Angeles to study resident protections City folds and approves subdivision of MHPark The City of Thousand Oaks “proudly touts itself as the most pro-tenant city in the state when it comes to mobilehome parks, and it has one of the most restricted mobilehome rent control statutes,” says Orange County attorney Rob Coldren. When the owner of the 304-space Vallecito Estates proposed to subdivide the park, the City Council enacted an ordinance that would have given tenants a veto; all but four residents opposed subdivision. The park owner sued the city, and in midJuly a Ventura County Superior Court struck down the ordinance. On September 8, the City Council voted 4-0 to approve the subdivision. Council members said they felt terrible about the action. According to the Ventura County Star, the city attorney cautioned the council that not approv-

ing the conversion could open the city up to damages ranging from $3 million to $20 million. The city manager said losing that amount of money would be damaging to the city. City officials said they were forced to heed both the local court decision and a recent appellate court decision. Thousand Oaks had mirrored its ordinance after the one in Sonoma County that the appeals court rejected. According to the Thousand Oaks Acorn, city staff negotiated continued below-market rents for individuals with annual income below $49,000 and for twoperson households with income below $56,000. For residents whose incomes are above those amounts, rents will increase to market in increments over the next eight years instead of just four years as in state law. The agreement also included city purchase from the mobi-

lehome park of parcels of 32 acres and 18 acres for open space, and transfer of 4.6 acres of city land to the park for brush, slope, and drainage management. Coldren’s law firm represented the successful park owner, Vedder Management. City of Los Angeles to study more protections for mobilehome owners The Los Angeles City Council unanimously approved a motion by Councilman Richard Alarcon of ways to increase protections for mobilehome owners and to “protect mobilehome parks as a source of affordable housing.” The city’s Chief Legislative Analyst and the city Housing Department are to compare L.A.’s current ordinances with those in Riverside and Ventura Counties, as well as other jurisdictions. Alarcon’s focus, in part, is on the provision of the city’s rent control ordinance that allows park owners to increase rent by 10% when a mobilehome is resold. There are 62 mobilehome parks with 6,622 spaces in L.A.

Mobilehome Parks Report™ ❑ September 2009 ❑ Page 5 Dogs, insurance, and “reasonable accommodation”

Written confirmation from the insurance carrier would be

well-advised before turning down an assistance animal.

U.S. Department of Housing and Urban Development Persons with disabilities applyinig to rent mobilehome spaces sometimes have dogs that don’t meet the park’s criteria. Often the dog is larger than the size permitted by park rules and regulations. If the dog is a legitimate trained service animal needed by someone who is blind or has some other physician-documented disability, the park can readily make a “reasonable accommodation.” Sometimes, though, the park’s concern is with the breed of dog and whether there is a conflict with the park’s insurance coverage. Portland, OR attorney Charles Greeff provided us with a U.S. Department of Housing and Urban Development opinion when insurance policy restrictions are cited by the landlord as the reason for refusing to accept the disabled applicant’s dog.

Washington, DC 20410-2000 July 12, 2006 MEMORANDUM FOR: FHEO Regional Directors FROM: Bryan Greene, Deputy Asst. Secretary for Enforce ment and Programs, ED SUBJECT: Insurance Policy Restrictions as a Defense for Refusal to Make a Reasonable Accommodation This memorandum responds to guidance on how HUD investigators should examine Fair Housing Act “reasonable accommodation” cases where a housing provider cites an insurance policy restriction in denying a request from a person with a disability to reside in a dwelling with an assistance animal that is of a breed of dog that the landlord’s insurance carrier considers dangerous. In the referenced cases, the housing providers stated that their insurance carriers will either refuse to cover their properties, substantially increase the cost of coverage, or adversely change the terms of their policies if these animals are allowed to occupy dwellings. As with any request for a reasonable accommodation, the request should be evaluated on a case-by-case basis. HUD provides the following guidelines to assist in that evaluation. According to the Joint Statement on Reasonable Accommodations, an accommodation is unreasonable if it imposes an undue financial and administrative burden on a housing provider’s operations. If a housing provider’s insurance carrier would cancel, substantially increase the costs of the insurance policy, or adversely change the policy terms because of the presence of a certain breed of dog or a certain animal, HUD will find that this imposes an undue financial and administrative burden on the housing provider. However, the investigator must substantiate the housing provider’s claim regarding the potential loss or adverse change to the insurance coverage, by verifying such claim with the insurance company directly and considering whether comparable insurance, without restriction, is available in the market. If the investigator finds evidence that an insurance provider has policy of refusing to insure any housing that has animals, without exception for assistance animals, it may refer that information to the Department of Justice for investigation to determine whether the insurance provider has violated federal civil rights laws prohibiting discrimination based upon disability.

Mobilehome Parks Report™ ❑ September 2009 ❑ Page 6 Boutique Hotel Attracts International Attention with “Trailer Park Penthouse”

The Grand Daddy Hotel in Cape Town, South Africa has a unique twist on the boutique hotel experience in the form of a rooftop trailer park. The “Airstream Penthouse Trailer Park” consists of seven vintage Airstream trailers customized by local artists that are available for guests to stay in. Each of the polished chrome trailers sleep two people, and are embellished with design themes that include “Goldi-

locks and the 3 Bears,” “Love of Lace,” “The Ballad of John and Yoko,” and “Pleasantville.” The hotel explains, “Your Airstream is enclosed by a tidy garden complete with US Postal Service mailbox. Watch an outdoor movie on hot summer nights at The Pink Flamingo Cinema and find an excuse to make this the destination for your next gathering of family and friends.”

All Airstreams are air-conditioned, well-insulated, have hot and cold running water, flushing toilets and showers.

Rates in mid-October are 900 Rand per night in a standard Airstream (about $125 USD). http://www.granddadd y.co.za/hotel_airstr eam.php

This publication is intended to provide accurate and authoritative information about the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting or similar professional services. If legal advice or other expert assistance is required, the service of a competent professional should be sought.

Mobilehome Parks Report™ The Monthly Report on Investment and Ownership 3807 Pasadena Ave., Suite 100 Sacramento CA 95821-2895 (916) 971-0489 e-mail: tkerr2002@sbcglobal.net Forwarding and Address Service Requested

September 2009 © 2009 by Thomas P. Kerr, Inc. ❑ 3807 Pasadena Ave., Suite 100 ❑ Sacramento, CA 95821 ❑ (916) 971-0489 Please respect copyrights. You have contracted for an individual subscription. Reproduction is illegal.