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Home My WebLink AboutRENT REVIEW COMMISSION - MINUTES JULY 1986 - SEPT 1987 . " MINUTES PALM DESERT RENT REVIEW COMMISSION MONDAY, JULY 21 , 1986 CIVIC CENTER COUNCIL CHAMBER � � � : ■ � � � : * # * : ■ � : � . � . � � * . f I . CALL TO ORDER Vice Chairman Gibbs convened the meeting at 4 : 10 p .rn. II . PLEDGE OF ALLEGIANCE - Commissioner Isbell III . ROLL CALL Present : Excused Absence : Vice Chairman Joseph Gibbs Chairman Sabby Jonathan Commissioner Lois Graham Cornmissioner Michael isbell Commissioner Patricia Power Aiso Present : David J . Erwin , City Attorney Jean M . Benson , Council Liaison Sheila R . Gilligan , City Clerk/P . I . O. Mary P. Frazier , Secretary IV. NEW BUSINESS A . CONSIDERATION of Continuation of J . K . Moran as Nearing Officer . Mr . Erwin stated that Mr . J . K . Moran had been appointed as hearing officer in the Indian Springs Mobilehome Park hardship rent increase petition . He said that the ordinance provides that the hearing officer shall be im�artial , and the impartiality of Mr . Moran had been questioned by the owner of Indian Springs Mobilehome Park . Mr . Erwin suggested that testimony be � iven in the following order : 1 ) Park owner or his representative; 2 ) Representative of the park tenants ; and 3 ) Mr . Moran . The Commission would then make a determination as to whether or not Mr . Moran wili continue � • � , , MINUTES PALM DESERT RENT REVIEN COMMISSION JULY 21 , 1986 # * � iF �F ! f fF �F � !F # # � # • iF � # f iF R � # * as the hearing officer . If Mr . Moran was removed , the Commission would aiso need to determine who the new hearing officer would be for the purpose of this petition . Vice Chairman Gibbs verified that each Commissioner member had received and reviewed the following : 1 ) July 9, 1986 , letter from the firm of Best , Best 8� Krieger ; 2 ) July 1 , 1986 , letter from Mr . J . K . Moran ; 3 ) July 15 , 1986, letter from Mr . Loren Steward , President of indian Springs Mobilehorne Owners Association . He invited testimony from the park owner or his representative . MR . PAUL SELZER of Best , Best 8 Krieger , stated that he represented the park owner , Mr . Jim Goldstein . He reviewed in detail his letter dated July 9 , 1986 (attached hereto and made a part hereof as Exhibit "A" ) . He added that he felt it wc�uld be in the best interests of everyone concerned to start with a hearing officer acceptable to both parties . Upon question by Vice Chairman Gibbs , Mr . Selzer responded that Mr . Goldstein had advised him that Mr . Moran had previously represented an owner of a park in a similar petition for hardship rent increase. He added that Mrs . Gilligan had also indicated to him early on that she believed Mr . Moran had represented both tenants and landlords . However , she later found out that he had not , and she advised him of this finding . Vice Chairman Gibbs invited testimony from the tenant representative . MR . LOREN STEWARD , President of Indian Springs Mobilehome Owners Association , reviewed his letter dated July 15 , 1986 (attached hereto and made a part hereof as Exhibit "B" ) . He added that he felt Mr . Moran would be a fair and impartial hearing officer . Vice Chairman Gibbs invited testimony from the hearing officer . MR . J . K . MORAN stated he felt the park owner had over- reacted to his letter dated July l , 1986 . He had spoken wi th the prev i ous hear i ng off i cer and attempted to stay with what he had previously requested . Ne felt the word "sharp" does not indicate any bias on his part . As to the question of the base year , in his discussions with the 2 MINUTES PALM DESERT RENT REVIEW COMMISSION JULY 21 , 1986 * * � � * * � � � * . � { * � f * * * � � * � � � previous hearing officer , he felt it had not been discussed fully , especially in light of the new ordinance . He felt that any issue in the new case was open for discussion , and he could not find anything in the ordinance which "grand- fathers" anything from one hearing to the other . He added that he had not indicated which way he woutd decide the hearing and feit that it was the duty of the hearing officer or judge to put forth a little extra effart to make sure the issues are presented properly when one party is not represented by an attorney . In case the Commission had any feelings about opening up the base year issue , his intent was to indicate two recom- mendat i ons as a resu 1 t of the hear i ng : 1 ) If he was persuaded that the base year was inappropriate and a new ba se year f i gure was i n order , he wou 1 d make a recom- mendation along that line ; 2 ) At the same time , since the Commission had already dealt with that issue on two occasions , there would be a second recommendation leaving the base year as it was . Upon question by Commissioner Isbell , Mr . Moran responded that he had not represented park owners or tenants in any rent control decisions . However , he had been Assistant C i ty Attorney for the C i ty of Pa 1 m Spr i ngs for s i x and a half years . During that time, he drafted the first mobile- home rent control ordinance and served as counsel to the Re�t Review Commission . Upon question by Commissioner Gr�ham, Mr . Moran responded that he had rece i ved a ca 1 1 from the C i ty C 1 erk ask i ng i f he would be interested in serving as hearing officer . Upon question by Vice Chairman Gibbs . Mr . Moran responded that the figures he had used were from documentation submitted in the hardship rent increase petition . In response to Mr . Moran ' s statement that it was the duty of the hear i ng off i cer or judge to put forth a 1 i tt 1 e extra effort to make sure the issues were presented properly when one party is not represented by an attorney, Mr . Selzer stated that in at least one previous Indian Springs case the tenants were represented by Attorney Toni Healey. He added that he felt an important fact was that this matter had gone to court and beyond the Rent Review Commission , and the 3 MINUTES PALM DESERT RENT REVIEW COMMISSION JULY 21 , 1986 . . ; f f * f f # * � . * * � * � . � * . � � � � question of constitutionality had never been raised by anyone . Vice Chairman Gibbs closed the meeting to public comment and asked for the Commissioners ' comments . Commissioner Power stated she felt Mr . Moran' s letter made it appear he had less expertise than might be expected of someone with that much rent review experience . However , she did not believe there was anything indicating that he was biased. Commissioner Isbell stated he could find no basis for a finding of bias on the part of Mr. Moran . Commissioner Graham felt that Mr . Moran was an honest individual , and she could find no basis for bias . However , she fe l t i t m i ght be i n the best i nterests of everyone concerned to appoint a new hearing officer acceptable to both sides . Vice Chairman Gibbs stated he could not find any evidence of bias . However , as indicated by several of the Commissioners , the tenor of the tetter did cause some concern . He felt Mr . Moran may have been too conscientious and overzealous in trying to be sure the tenants were duly represented. However , he felt Mr . Moran was getting into areas which should not be deait with until the Commission meets after the evidentiary hearing stage. He agreed that it might be better at this point to select a new hearing off i cer . Mr . Erwin advised the Commission that it had several alternatives . It could , without reflecting on Mr . Moran , try to come up with a slate of three different names and see if any of them were acceptable to both parties . Upon question by Commissioner Power , Mr . Erwin responded that Mr . Moran ' s name would be one of the three . Vice Chairman Gibbs reminded the Commission that it first needed to determ i ne whether or not there was suff i ci ent evidence of bias on the part of Mr . Moran , and then it could decide whether or not he should be retained as 4 MINUTES PALM DESERT RENT REVIEN COMMISSION JULY 21 , I986 � � f � � . � * � � * # * * � f � � * � * * s t � hearing officer . The Commission concurred that there was not sufficient evidence. After considerable discussion , the Cornmission agreed to continue this matter for two weeks . Mr . Erwin was directed to work with the park owner and tenants to find a mutually acceptable hearing officer . If they were unable to do so, the Commission would appoint one for this case at its ajourned meeting of August d , 1986 . V. ADJOURNMENT With Commission concurrence, Vice Chairman Gibbs adjourned the meeting at 5 : 05 p .m. to Monday, August 4 , 1986 , at 4: 00 p. m. EPH A . IBB , CE CHAIRMAN ATTEST : � � �, � , � �.. �'�..� �--1, -'L:% MARY P . FR IER , S CRET Y � 5 MINUTES PALM DESERT RENT REVIEN COMMISSION JUIY 21 , 1986 # iF f ! * i f � * * * i 1F iF # # f ■ 1F iF # * !f # iF EXHIBIT "A" LAW OFFICES OF „��.��rn��M. pAv10 L.�AIqM B E 5 T, B E ST 6i K R�E G E R nrvcRs�oc orncc GL[N[.fK►M[N�• V11qIN1A A.(T}IMO[A •I�tIM[11M��1�MCWpM�pItlMOMY CM��fWw� �200 ORANGL 1T11[[T WIWAM IL DI+MOVL• VK7011 L.WpV r.0.�O% 10!• B�IITON C.6AYT• wM�u co�rvic� a00 EA3T TANOUIT2-MGCAILUM WAt RIVCRlID[��roRN1A Y=f0■ CN�RIp 0./ILlO• MI[L NC1111t Cµ,pNN( o�Ul T.3[lZ[I1• DANI[L J.Mp1ypN P.O.90X 27�0 (714)6el�1�30 O�L�AS wOlMp• u�L/.M[II�O�D.J14 _ RICNAAO'T.AMDLAWM��• r�4[M►�►�� PALM SPRIN63.G�IFORNIA a2263 rt�NCMO MIM6[OAICt JOMN O.W�MIIM• JOMM A.AO�TfCMAC►[A MICNA[�D MAIM�S• V��NIA A•JOMMSOM TELEPMONE(61p)325-7264 MOrf lOUA11[ ►AOFE!lIONA�C[NTI�[ W.CURT l[TITIA G�[�r[Ii �Y700�O�MO►C DRIV THOM� u�r� MYRIM A.M11[LL[I1 TELE% 752735 r,O•WX SOS�SUIT[]12 1 S.lLO��M• J.MICMKI iWM(11pU1� JONN [.�110wM• Np�yAAD/.GOLD! pANCNO M1MGC.CAt,IFORNIA Y2270 WONA�O J.RONUT KLNDALL M.M�CV(r QIi 3�0-2M6 MICti�[L T.NIDO[lL• MICX�(L�OURFL[ � � M[N[DITM�.JU�1'• CLAM1 M.�1f0� MKM�(�pMNT — FN�NCI!J.�MIY �U6[N[TANAM •NN[T.TMOMA/• MAIpA11R/TANAI{A 0011pOM COL.00M(�OI COUM�[L O.MAIRIN NLTN[A1'• lAy1�T.CM/JMAN J.W[��•C0111tON,0ICOUwf[l GCORQ[M.11C1'[s J[F/[Al'J�CNANOA�� AKM�IIO A.OfN�Mf�Of COUM�[l�� W�lL1AM W.FIOYO.J11. SCOTT C.SMITN MICMA(�A.CFIS*C UNCC A.�ONII GA[G0�1Y L.MAI�pKL JACK�.CIARKL 11AYMOMD�[fT(I�f�'I�f)) RIGM�IID CRO!! �4OM A.G��D J�M[!�.��[O�n(If17-1�)�) iRwIN L.60LDS J[AMN[TT[A.IR[11iON ANTONIA O.WCIMCA CNAIlTIM[M.MORTM [WtML�t\T I��i-��I) 11AR1[Y 4 LlLLLAMO T[111 I.VOLV100L[ •�AOY�R(D IM�N[VADI�.M[W Yp1111 •A►110I[!lIONK COI�/OMTION wA{N�MOTOM,O.C.COYRT Of CWM� July 9, 1986 ..3�C� City of Palm Desert Q(� Rent Review Board ,>O v \�� 73510 Fred Waring Drive o� Palm Desert, CA 92260 � �� Re: Petition for Aardship Rent Increase at Indians Springs Mobile Home Park Ladies and Gentlemen: This office represents Mr. James Goldstein owner of Indian Springs Mobile Home Park which currently has pending before your Board a petition for a Hardship Rent Increase. This letter is being written with respect to the proposed hearing on the hardship rent increase and in particular the identity of the hearing officer previously appointed by you. Prior to the appointment of Mr. J. K. Moran as Hearing Officer we were informed that Mr. Moran was an impartial hearing officer and that he had represented both owners and tenants in previous rent control hearings in several cities in the Coachella Valley. Based upon that information we indicated to the City that we had no objection to Mr. Moran's appointment. Since that time we have been informed that Mr. Moran has not represented owners before Rent Control Boards which in our view, by itself would be grounds to disqualify him; in addition however, enclosed please find a letter dated July 1, 1986 from Mr. Moran to my client concerning the hearing, which indicates to us that he may not be approaching this hearing as an impartial arbiter. As I am sure you will agree, the content and tenor of that letter are those which might be expected from an advocate for the tenants, but not an impartial hearing officer. we are extremely concerned in view of the fact that Mr. Moran appears to be attempting to throw-out base year information which has been utilized in two other previous hearings and certified by the hearing officer in those cases. Furthermore, the tenor of the letter clearly indicates that Mr. Moran would begin this hearing believing that certain items of expense were unreasonable. The use of the adjectives "sharp" and "substantial" to describe 6 MINUTES PALM DESERT RENT REVIEM COMMISSION JULY 21 , 1986 � � t * * � f � # : � � # * � . � � * * * � � � * EXHIBIT "A" ��w orriccs o► BEST,BEST 6 KRIEGER City of Palm Desert July 9, 1986 Page 2 increases, we think, indicates that Mr. Moran approaches this hearinq with a biased point of view. We believe that our opposition is further strengthened by his citation of cases which we believe do not substantiate the position which he has set forth. While I would not be surprised to see an attorney for the ' tenants citing those cases for the positions stated, we are ! shocked that an allegedly impartial hearing officer would cite them at this point and indicate that my client has been gi�ven some sort of "special privilege" which might violate the Equal = Protecion and Due Process clauses of the Federal and State Constitutions. The tenor of Mr. Moran's letter clearly indicates that he would not be an impartial judge. Based upon the provisions of Palm Desert City Ordinance Number 456, Section 9.50.020L we respectfully request that Mr. Moran be removed as hearing officer and that another hearing officer be appointed who would fulfill the requirement of impartiality. I realize that this is a late date to object to Mr. Moran's •_ appointment but I have been on vacation and did not receive a copy of the letter until Tueday, July 8, 1986. Because the current hearing has been scheduled for July 14, 1986 we would respectfully request that this matter be given your immediate attention and that regardless of your decision the hearing currently scheduled for July 14, 1986 be continued to a later date. We would be more than happy to address your honorable body to further discuss the matter at your convience. Thank you for your kind consideration of this matter. Yours very truly, BEST, BEST & KRIEGER �� Paul T. lzer PTS/ts Enclosure cc: Mr. Ken Moran Mr. David Erwin Mr. James Goldstein 7 MINUTES PALM DESERT RENT REVIEW COMMISSION JULY 21 , 1986 * � f � . � : f + . . � � � * ■ � * * * � . * � � EXHIBIT "A" Lww OF•Fices or • • J. K. MORAN A PitOFP�SS[ONAL LAW CUh'POKATIOfY 777 H:wS1' '1 aHOUIT'L WwY, SUITE :.'UU P.O. Bux 1374 Aiar:�Cou►:�619� PALM SPRtNCB.CwLIt�U[iNlw 9`.'.�63 '1'�a.r.�•nunF:,:S_O-�iJtl�S � Cwut.►:Auuer:au�Sut+�.�x i� R�r�.Y. R►:r�:e 9'a PfRSONAL 6 CONFIDENTIAL VIA ZAp/KAI�, July 1, 1986 (2 hour delivery) Jim Goldstein � 2800 28th Street, Suite 204 � x:nta Me.^.ica, CA 904u5 Re: Petition for Hardship Rent Increase at Indian Springs Mobilehome Park Dear Mr. Goldstein: This will confirm that pursuant to your request for a continuance, your petition for hardship increase Will now be heard on Monday, July - 14th, 1986 at 3:00 P.M. at Palm Desert City Council Chambers. I understand that you have already been notified of this change by the City Clerk's office. At the time of the hearing I would like you to present evidence on the following specific matters: 1. Acr�cu�ting (S4,520 Page 2). Please provide infoxmation with regard to the increase in accounting expenses between the actual expenses for 1985 and the year of application. together with a breakdewn of the various accounting services provided in the year of application or anticipated. 2. Insuranc� Premicu2s (S11,550 Page 2). Please provide infortnatio♦n and docvmentation explaining the increase in the expense i tr.Ti Q111~.i 1.1C'x1 ��iiljliicllC2 'c'�'diiil1i115�� 3:.d .}.r19 3C.~.:;.'il @:.^"�nses fo� ?9a�. 3. Lega1 Fe�s (S1,949 Page 2). Please be prepared to justify the expenditures indicated.• Be prepared to itemize the particular services rendered by attorneys during 1985 and 1986 to prove the expenditures. 4. 1�fanagement Fe�s/Salaries (S31,284 Page 2). Please be prepared to discuss the basis on which the management fees are paid and provide me aith the management contract setting forth the fees based on the gross income provision. Be prepared to discuss the specific employees whose salaries are paid and the functions perforn�ed by each, and why � they are entitled to the increase in the amount they received. Be prepared to discuss similar positions in the area and whether the pay scale is consistent with others in the area. 5. Offic� Supplies (S2,902 Page 2). Be prepared to explain the 8 MINUTES PALM DESERT RENT REVIEW COMMISSION JULY 21 , 1986 � * � t � . # t � # � � . * � � � � � � � � � � * EXHIBIT "A" Jim Goldstein July 1. 1986 Page 2 increase in office supplies in the year of application over the previous year. 6. Ru6bish Rernoval (S1,825 Page 3). Provide doc-�unentation to support the increase in rubbish removal expense, including acutal expense for 1985. 7. Cleaning and Janitorial (S3,274 Fage 3). Provide = � doc�mientation and an explanation of the sharp increase in cleaning and , janitorial fees over 1985. 8. Pao1 E7r�nses (S5,996 Page 3). Provide an explanation and doc�cnentation to support the increase in pool expenses over 1985. 9. S�curity SP.rvic�s (52,�35 Page 3). Provide documentation and an explanation of the sharp increase in security services and an explanation of what services are rendered for that fee. 10. Landscaping EX�nses (S25,326 Page 3). Provide docurt�entation and an explanation of the sharp increase in landscaping expenses. Be prepared to prove the payment of this expense and to discuss the nature of the landscaping provided. ' 11. Painting anrd R�lecnrating (S3,02B Page 3). Please submit da.wnentation to justify the large increase in year of application and to discuss the nature of the painting and decorating that is proposed. Please be prepared to establish the payment of this amount in the year of application. Provide information to establish the estimated useful life for this capital improve.ment. 12. PI�m►bing (S3,235 Page 3). Be prepared to prove the payment of this expense and discuss the nature of work done in vierr of the large proposed expenditure in the previous year of 516,854. Show actual cost for 1985. 13. Electrical (S2,B96 Page 3). Be prepared to establish the payment of S2.846 and to explain the size of the increase over the previous year. 14. Casoline and Oi1 (S1,107 Page 3). Please be prepared to prove the payment of this expense together with discussing the nature of this particular expense as it applies to allowable operating expenses. 15. Maintenanc� and ReEairs (S12,287 Page 3). Please itemize these expenses and provide documentation to support the charges. 16. Rea1 Pro�xty Taxes (S39,099 Page 3). Please provide � documentation and proof that the park will experience a 2 percent 9 T MINUTES PALM DESERT RENT REVIEW COMMISSION JULY 21 , 1986 * � * � * � f � � # * � � * . � � � � . * � � f f EXHIBIT "A" Jim Goldstein July 1, 1986 Page 3 increase in tax for the year of application. 17. Li�nse and Registration F�es - Chamber of Cam�rc� Dues (S525 Page 3). Please explain the nature of this garticular expense as it applies to allowable operating expenses. And be prepared to prove the payment of this expense. 18. Electricity (S7,902 Page 4). Be prepared to establish actual �ycrent for 1985. Be pr�t�ared to establish ahy this substantial increase should be permitted. 19. Cas (S29,714 Page 4). Show proof of actual price paid for 1985 gas. Why should increase be allowed? 20. Water (S56,299 Page 4). Be prepared to establish actual payment for 1985. 21. Parking lighting (S25,415 Page 4). Please detail and itemi2e the proposed lighting to be installed and indicate what purpose the lighting is designed for. Provide proof of payment for any work done to date in year of application. 22. Car�ting in Clubhouse (S3,536 Page 4). Please detail what area in clubhouse the caz-neting is designed to serve. Also indicate period of time since last replacecnent and the useful life of this capital expense. 23. NeW Sewer Seep3ge Pits (S3,978 Page 9). Please explain the location of the pits in regard to the pits which were previously prepared. Why are there additional pits needed in view of loat year's extensive replacements? 24. �'vr�rtiaation ef 19B3 Capi ta1 Ekpenses (S5,2�18 Page 5). Please itenize the capital expenses being amortized. 25. Amortization.of 1964 Capi ta1 EXpenses (S3,110 Page 5). Please itemize the capital expenses being amortized. 26. The latest applicable C.P.I. must be provid�. 27. Base y�az- Calculation. A review of the findings of fact fran July 30, 1984. before the current rent review ordinance was in effect. indicate that the base year contained an annualized figure as of Decanber 31, 1982 and did not reflect the actual income for that year. ��! Please be prepared to explain Why the base year figure should not be �� adjusted at this time to include the actual income for that year in view of the following cases: Carson Mobilehane Park Owner's Association vs. Citv of Carson 35 C.3d 184 (1983); Fisher vs. The Citv of BerkleY (19II4) 37 C.3d 644; 10 , MINUTES PALM DESERT RENT REVIEW COMMISSION JULY 21 , 1986 � f �r � t �r t * �r �r �t �r � �e t f * * * * � �r * � * � EXHIBIT "A" Jim Goldstein July 1. 1986 Page � Oceanside Mobilehane park Owner's Association vs. Citv of Oceanside (1984) 157 C.A.3d 887, 204 C.R. 239; and Palos Verdes Shores Mobile Fstates. Ltd. vs. Citv of Los Maeles (1983) 142 C.A.3d 362, 190 C.R. 866. Apparently, Indian S��rings Mobilehane Park is the only such park which has been granted this special privilege of annualizing its i�cane rather than using actual incor,�e. Therefore, you should also be - prepared to explain why the continuation of such a privilege would not � violate the Fyual Protection and Gue Process clauses of the Federal and _ State Constitutions as well as the requirement of Substantive Due Process (See Card vs. Carm. Redevel. Aaencv of So. Pasadena (1976) 61 C.A.3d 570 at 579, 131 Cal. Rptr. 153 at 160). You should also be prepared to explain why such deprivation of constitutional rights of the mobilehane owners would not be a violation of 42 United States Ca�ie § 1983 (The Civ11 RightS A�ct of 1871). With regard to all the information contained in your petition. please provide the backup doc�cr,�ntation in the fonn of general ledgers, journals. etc. at the Palm Desert City Clerk's office. You must provide that information no later than Wednesday, July 9th, which is 5 days before the hearing date so that it can be reviewed by the haneowners. The City Clerk will see that copies are sent to the haneo�rners. ' Very tzuly yours. LAW OFFICE� OF J. K. MORAN a Professional LaW Cozporation �"i � By: J. K. MOFi�1N JIQ�!:pf cc: Mr. Stewart Shiela �7aham ' 11 ,+ , , . . MINUTES PALM DESERT RENT REVIEW COMMISSION JULY 21 , 1986 * i # � !� * # i f f i � � * • # ! f � iE iF �F i • f EXHIBIT "B" INDIAN SPRINGS MOBIL�HOME 0�lN�RS ASSOCIATION _ 49-305 Highv�ay 74, Space 107 Palm Desert, CA 92260 July 15, 1986 � City of Palm Desert , Rent Review Board 73-510 Fred �1/aring Drive Palm Desert, CA 9Z260 Ladies and Gentlemen: VJe have reviewed the letter from Mr. Paul T. Selzer, Attorney, in regard to the appointment of P�ir. J. K. Moran as hearing officer for the Hardship Petition oi Mr. James Goldstein. Althou�h I have never met t�ir. Moran personally, it is the desire of the Indian Springs Homeowners Association that he be maintained as hearing officer. It is our understanding that in Mr. t�ioran's letter of July 1, 1986 addressed to Mr. Goldstein he requested data �rhich we had been asking for at the two previous hearings. One item we requested was that his reports be presented at least .three days before the hearings. This has never been accomplished. If his records can prove he is entitled to such large increase, what has he to fear? :7e believe that Mr. Moran t+rill be a fair, impartial hearing officer, and respectfully request that he be maintained. Sincerely, - ' �, ' " '�` G , < � � / 3,oren Stery d� Presi�lent �� A Cp --i � � L �', C r- r - i 7 F-r e �7 �i -•l �'7 � �� i � � , cl �;� N � 12 MINUTES PALM DESERT RENT REVIEW COMMISSION MONDAY, AUGUST 4, 1986 CIVIC CENTER COUNCIL CHAMBER � i � � � � . . * f f « � * f � � f . f � . * � � # I . CALL TO ORDER City Attorney David J . Erwin advised that the first order of business was for the Commission to appoint an acting chairman inasmuch as the Chairman and Vice Chairman would be absent. Commissioner Michael Isbell was selected to act in this capacity. Acting Chairman Isbell convened the meeting at 4 : 05 p.m. II . PLEDGE OF ALLEGIANCE - Commissioner Power III . RO�L CALL Present : Excused Absence : Commissioner Lois Graham Vice Commissioner Joe Gibbs Commissioner Michael Isbeli Chairman Sabby Jonathan Commissioner Patricia Power Also Present : David J . Erwin , City Attorney Sheila R. Gilligan , City Clerk/Pubiic Information Officer Mary P . Frazier , Secretary IV. APPROVAL OF MINUTES OF JULY 21 , 1986 Upon motion by Graham , second by Power , the Minutes of the meeting of Juty 21 , 1986 , were approved as presented by unanimous vote of the Commissioners present . MINUTES PALM OESERT RENT REVIEW COMMISSION MEETING AUGUST 4, 1986 � t * � � f # * * � � � � � * � � � * f * * . t V. CONTINUED BUSINESS I A . CONSIDERATION of Continuation of J . K . Moran as Hearing Officer (Continued from the Meeting of July 21 , 1986) . Mr . Erwin reported that as a result of the July 21 , 1986, meet i ng he had prov i ded Mr . Pau 1 Se 1 zer ( attorney for the park owner , Mr . Jim Goldstein ) and Mr . Loren Steward ( representative for the tenants of Indian Springs Mobileh�me Park ) with a tist of four individuals to be considered for the position of Hearing Officer for this case . The four individuals were : Attorney J . K . Moran , Attorney Jeff Patterson , Deputy District Attorney Rick Erwood , and Attorney Henry Cleary. Mr . Isbell invited input from the tenants . MR. LOREN STEWARD spoke on behalf of the park tenants and reviewed his letter dated July 31 , 1986 (attached hereto and made a part hereof as Exhibit "A" ) . Upon question by Mr . Isbell , Mr . Steward responded that the tenants were opposed to Mr . Patterson because of decisions reached on the two previous hardship rent increase petitions . He added that the tenants had not been able to contact Mr . Cleary directly but from information they had received , they felt he would not be able to represent them fairly. Mr . Isbell invited input from the park owner . MR . PAUL SELZER of Best , Best and Krieger stated he and Mr . Goldstein had discussed the individuals recommended by Mr . Erwin and that their first choice was Jeff Patterson inasmuch he was involved in the two previous cases . Their second choice would be Mr . Cleary because of his arbitration experience . He added that their third choice would be Rick Erwood , with their only objection being his lack of expertise in civil matters . With respect to Mr . J . K . Moran, Mr . Selzer stated that he had expressed his concern and opposition at the previous meeting. Mr . Isbell reminded everyone that although the Hearing Officer reviews all testimony and documentation and makes recom- 2 MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING AUGUST 4, 1986 iF i !F ! �F f � i �F � �!F ! � # # f �IF f � f 1F 1F �F f mendations , the final decision as to any hardship rent increase will be made by the Commission . Commissioner Graham moved to appoint Mr . Rick Erwood as Hearing Officer for the Indian Springs Mobilehome Park rent increase petition . Mot i on was seconded by Power and carr i ed by unanimous vote of the Commission members present . Mr . Selzer asked the Commission if it could appoint an al ternate i n the event Mr . Erwood was not abl e to act i n this capacity. Mr . Steward asked whether the hearing could be delayed inasmuch as he would be receiving some medical treatment in September . Mr . Se 1 zer stated that he and h i s c 1 i ent wou 1 d do everything necessary to accommodate Mr. Steward' s requPst. Mr . Erwin advised that this request should be made to the Hearing Officer , not to the Commission . After additional discussion , Comrnissioner Graham moved to appoint Mr . Henry Cleary as the alternate Hearing Officer in the event Mr . Erwood is unable to act in that capacity. Motion was seconded by Power and carried by unanimous vote of the Commission members present . VI . ADJOURNMENT Upon rnotion by Graham, second by Power , and unanimous vote of the Commissian members present , Acting Chairman Isbell adjourned the meeting at 4 : 35 p.m. �-�-�_��' �� ,�--�.�� MICHAEL ISBELL , ACTING CHAIRMAN ATTEST : � �� . ��-- MARY P. AZIER , SECR ARY 3 MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING AUGUST 4, 1986 � � f f . f * f . f � * f � f f f # . � # � * * , _l EXHIBIT "A" IIdDIAN SPRIIJGS i�fOBILE H;O��`f �RK 49-305 Highvray ?4` ��C7� Palm Desert,��C�� 92�6c}�� g 06 July 3i �6 CITY WL-ft1Cs G�ri�� Pa1r� Desert City Council Palm Desert, California �ubject: Hearing Officer Rent Revie�v Loard Gentlemen: The Board of the Inciian Springs Homeovrners Association met follovring the July 21st Rent Revie�v hearing. �`le a�plau�d the action of the members of the City Council in apbointing P�1r. J. K. I�toran as the Hearing Officer for the P,ent Review Board and tive trust that he may re- main in this office. '�Je feel that he is a kno��ledgeable and unbiased representative for both the Park o;�m ers and the Park renters. And as each member of the hent Revie�•� Board stated that he or she could find no bias in his judgrnent, �ve urge his retention. IIorrever should tir. i�Ioran be unable to act in this bosi- tion ti��e ��rould give -our support to P-1r. Rich �r�r�ood,y for it is our desire to ��orlc v�ith the City of Palm Desert in every ��ay possible, and �ve assure you of our continued interest in th� gro�rth and development of this City. �incerely, � � � � '' � �� i . � i / L�� '�L G�-L ,% I,6 en Ste��rard, President � �' 4 i MINUTES PALM DESERT RENT REVIEN COMMISSION MONDAY. NOVEMBER 3, 1986 CIVIC CENTER COUNCIL CHAMBER � . � . � � � . # � � � � * � � * � � . � � s : � i . CALL TO ORDER Chairman Jonathan canvened the meeting at 3 : 15 p.m. II . PLEDGE OF ALLEGIANCE - Commissioner Michael Isbeil III . ROLL CAL� Present : Vice Chairman Joe Gibbs Commissio�er l.ois Graham Commissioner Mike Isbell Commissioner Patti Power Chairman Sabby Jonathan Also Present : Doug Phillips , Deputy City Attorney Rick Erwood, Hearing Officer Jean M . Bensan , Council Liaison Sheila R. Gilligan, City Clerk/Public Information Officer Mary P. Frazier, Secretary IV. APPROVAL OF MINUTES OF AUGUST 4, 1986 With Commission concurrence , approval of the Commission Minutes of Augus� 4 , 19$6 , was continued to the next scheduled meeting. V. NEW BUSINESS A . R�IIEST FROM INDIAN SPRINGS MOBILEHOME PARK FOR HARDSHIP RENT INCREASE . On behalf of the entire Commission , Chairman Jonathan thanked Mr . Erwood for his clear, concise report of his findings and recommendation in this case . MINUTES PALM DESERT RENT REVIEN COMMISSION MEETING NOYEMBER 3, 1986 i i ! ! # � # f * # iF � f f • i f ! # f iF # �F f i Mr . Erwood reviewed his report and findings and stated that at the enci of the evidentiary hearing , he had advised both sides that they could request an additional pubiic hearing if they thought it was necessary ; otherwise , they were to direct any correspondence in writing ta the hearing officer . He stated that they were not to submit responses to each other . However , Mr . Goldstein had submitted a letter dated September 17 , 1986, (on file and of record in the City Clerk' s office) which was not in accordance with these ground rules , but this information was not reviewed prior to the hearing officer making his report to the Commission . Upon questions by the Commissioners , Mr . Erwood responded that the park manaqers were a husband and wife whose salaries were being paid by the park owner . Their office hours were a typical 8-5 Monday-Friday work week with no one available during the weekend except by beeper . Upon question by Commissioner Graham regarding the wife' s duties , Mr. Erwood stated that she had management duties when the manager was not present and also did bookkeeping and secretarial work and handled the petty cash disburse- ments . He said the management company also had instructed that the managers go to the bank and make a deposit once an excess of $300 was received at that location . This sometimes meant that two or three trips a day to the bank were made. He added that the park owner was paying for a management company in addition to the on-site managers and that the homeowners felt they were being charged twice for what was basically the same function . However , he as hearing officer did not consider it a double charge . Chairman Jonathan invited testimony from the homeowners' represent�tive. MR . J . K . MORAN , Attorney at Law, 777 E . Tahquitz Way, Suite 200, Palm 5prings , 92262 , objected to the letter of September 17 , 1986, from Mr . Goldstein and requested that it be stricken from the record and not considered by the Board in its dealings in this case . Mr . Phillips stated the objection was sustained without prejudice and instructed the Commission not 2 i � MINUTES � i PALM DESERT RENT REVIEW COMMISSION MEETING NOVEMBER 3, 1986 ' i �F f # i � !F i 1F � i iF i # • ; f i i # iF f ; �F !F to refer to the l etter i n quest i on i n any dec i s i ons made. Mr . Moran aiso objected to the document dated October 30 , 1986 (on f i 1 e and of record i n the C i ty C 1 erk ' s off i ce ) and stated that he had not had a chance to review it prior to the meeting . Chairman Jonathan responded that although both sides had been asked to submit any correspondence a week pr i or to the meet i ng , th i s was on 1 y so that the Commission could review it . It did not mean that no additional corres�ondence would be accepted after that deadline . Mr . Phillips added that the letters dated October 29 and October 30 ( on fi le and of record in the City Clerk ' s Office ) were rebuttals to the petition and the on 1 y pre�i ud i ce i n th i s case wou 1 d be to the Commission because of receiving them at such a late date. He recommencied that Mr . Moran ' s objection be denied, and the Cammission concurred. Mr . Moran reviewed Mr . Goldstein ' s letter dated October 29, 1986, and offered the following comments : - With respect to Item #6 Landscaping, Mr . Moran stated that although Mr . Goldstein stated he was not trying to recover the expense of replanting the ice piant , he continues to do so. - With respect to Item #3 Legal Fees , Mr . Moran stated he felt the Hearing Officer was right in cieny i ng th i s expense. He sa i d the park owner had indicated a settlement claim had been paid to resident Eunice Mowbray ; however , in his review of park directories , he could not fi �d a listing for this person . He stated that s i m i 1 ar expenses had not been a 1 1 owed by the Commission the previous year when the expense turned out to be a small claims expense . - Regarding salaries , Mr . Moran stated that management is not in close proximity to the park ; they are two mi les away, and the beeper 3 MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING NOVEMBER 3, 1986 � !F # f � 1F iF ; i iF i i f i * f • i � t IF �F * • � system is far from satisfactory. He added that the management could only be beeped when in the park , the answering service did not pick up when called most of the time, and messages were not passed on to management . He also felt it was unreasonable for management to go to the bank three or f i ve t imes per day and that the custom in other parks was that at least one member of the husband/wife team was available at all times . - Regarding capital expenses , Mr . Moran urged that the Commission concur with the Hearing Of f i cer ' s f i nd i ngs that they shou 1 d not be allowed u�til actually made . - Mr . Moran further stated he did not feel it was fair to spread the rent increase over 181 spaces instead of the 191 spaces in the park . Chairman Jonathan invited testimony from the park owner or representative . MR . JIM GOLDSTEIN , park owner , stated he felt Mr . Erwood had done an outstanding job during the evidentiary hearing and was very thorough in scrutinizing the park records . He stated that with the increases granted in previous years , he had tr i ed to upgrade the park ; he had the i ce plants replanted and had seen for himself that it had been done . He reviewed in detail his letters dated October 29, 1986, and October 30 , 1986 . In response to Mr . Moran ' s statement that Eunice Mowbray was not a resident , Mr . Goldstein stated that she was the guest of one of the homeowners and that he had been forced to pay the claim. He added that he did not feel this cost was unreasonable . Mr . Moran asked that , i � considering a rent increase, the Rent Review Commission keep in mind that many of the homeowners are living substantially or entirely on Social Security, with a 3�: projected increase in Social Security payments for 1986 . He said an increase wouid create a hardship for the homeowners . 4 MINUTES PALM DESERT RENT REVIEN COMMISSION MEETING NOVEMBER 3. 1986 f * � � . . . � � f � * . � * f � � f . � � � * � He also stated that payments for small claims were covered by liability insurance for the park and should not be passed on to the homeowners . Mr . Goldstein responded that the amount he was forced to pay was because there was a deductible portion in the insurance policy. Chairman Jonathan declared the public hearing portion of the meeting closed and calied a recess at 4 : 45 p.m. The meeting was reconvened at 5 : 00 p.m. The Commission reviewed and discussed the recom- mendations in Mr , Erwood ' s report . The members agreed that inasmuch as the ice plants were now in, this would be an additional cost for the next year . As far as salaries , Chairman Jonathan stated that he did not feel the Commission should be making a determination as to whether or not the park owner was in compliance with another part of the law not governed by rent control . Commissioner Graham stated she felt the salaries were not unreasonable . Vice Chairman Gibbs stated that the Commission must decide whether or not it agrees with the Hearing Officer ' s findings regarding salaries , and the issue was not whether or not the salaries were in accordance with the Health and Safety Code . Chairman Jonathan stated he felt the costs were reasonable for the level of services rendered, but the services rendered were not in accordance with the Health and Safety Code. Mr . E�wood stated that the law requires a certain level of services at a mobilehome park with 50 units or more - a resident manager or someone there for emergency type services . He felt reasonable compensation for services the residents are receiving was 50% of the amount requested by the park owner . 5 MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING NOVEMBER 3, 1986 i � # f # * ! i � f # # f f f # IF * f # �F � iF # ; The Commission members agreed with Mr . Erwood' s recom- mendation . As far as spreading the increase to only 181 units instead of the entire 191 , Mr . Erwood stated that 10 of the units were subject to lease and that the ordinance indicated the rent increase would not apply to those units . As far as pre-approval of capital improvements , Vice Chairman Gibbs stated that the Commission had spent some time discussing this issue and had agreed that the park owner would get pre-approval if actual costs were then submitted to the City Attorney , and it would also be amortized per the normal amortization schedule. Mr . Phillips stated that if the Commission did give pre-approval for the capital improvements requested, it might wish to determine an amortization time for the mobi 1 e home s i nce he di d not see anything appropriate on the amortization schedule . Vice Chairman Gibbs moved to grant pre-approval of the requested capital improvements for lighting, carpeting, seepage pits , and the mobile home as listed in Mr . Goldstein' s October 29, 1986, letter to the Rent Review Commission , subject to the following: 1 ) Verification of expenses for each capital improvement ; and 2 ) An appropriate amortization schedule for the mabile home would be determined by the Hearing Officer , with a normal amortization schedule to be used for the other three requested capital improvements . Motion was seconded by Commissioner Graham and carried by unanimous vote of the Commission. Commissioner Graham moved to adopt the findings and approve the recommendation of the Hearing Officer for a $ 10. 15 per space per month rent increase . Motion was seconded by Commissioner Power and carried by unanimous vote of the Commission . Chairman Jonathan asked what portion of the Hearing Officer' s bill would be paid by the homeowners anci what portion by the park owner . Vice Chairman Gibbs added that there were two bills to be considered : 1 ) the cost for Mr . Erwood to act as Hearing Officer and prepare findings and recommendation to the 6 . I MINUTES � PALM DESERT RENT REVIEM COMMISSION MEETING NOVEMBER 3. 1986 ' # � • # f ■ f i • i i i � i � i f i � i f � i f # Commission ; and 2 ) the cost for Mr . J . K . Moran for his preparations for an evidentiary hearing prior to his removal as Hearing Officer by the Rent Review Commission . Mrs . Gilligan reported that the City had alread.y paid Mr. Moran ' s bill in the amount of $2 , 237 . 75 , and Mr . Erwood had estimated that his bill would be approximately $3 , 125 . 00 for this hearing . Mr . Moran' s bili was paid with the understanding that the City would be reimbursed from either the homeowners registration fee fund or by the park owner . She added that it was up to the Commission to determine what percentage would be paid by each side. Upon question by Chairman Jonathan , Mr . Erwoad responded that he had prepared for the hearing on his own and had not used Mr . Moran ' s work ; however , he stated he had read Mr . Moran' s letter to Mr . Goldstein citing legai authority and had also reviewed the case file . Commissioner Graham was excused from the meeting at 5:45 p.m. Vice Chairman Gibbs moved that the total costs for both Mr . Moran and Mr . Erwood be divided equaliy between the homeowners and the park owner . Motion was seconded by Commissioner Power and carried by a 4- 1 vote, with Commissioner Graham ABSENT. Councilmember Benson expressed concern that the amount to be taken out of the homeowners ' registration fee fund was more than was collected for this particular park . She asked what would happen if and when the last park comes in with a petition for hardship rent increase and there are no funds available in that account . Chairman Jonathan responded that whe� the Comrnission was first considering this registration fee fund , it estimated future costs for these hardship rent increase hearings . He added that it was understood that if the fund was insufficient, the City would pay the difference . Mrs . Gilligan added that the City Council sets the actual dollar amount for the registration fee by resolution and that it could be changed to a higher amount next year if necessary. 7 � -- - — � MINUTES PALM DESERT RENT REVIEN COMMISSION MEETING NOVEMBER 3, 1986 * � � * f � * � . � � f * ,� * � . . � �r � # f . . Vl . ADJOURNMENT Upon motion by Commission Gibbs , second by Commissioner Isbeli , and unanimous vote of the Commission members present , Chairman Jonathan ad„journed the meeting at 5 : 50 p.m. _ �� y ^j '��. SABBY THAN, CHA RMAN ATTEST: c �� t.- - �, /� A wJ � �.+ MARY P. FRA IER, SECRETARY.� PALM DESER ENT REVIEW COMMISSION 8 MINUTES PALh DESERT RENT REVIEW COMMISSION HEETING MONDAY , DECEMBER 15, 1986 4: 00 P. M. * . * � * . * � . . � . � . � � � � � � * . l . CALL TO ORDER Cha i rman �onath,�n i.onvr�ned the meet i ng at 4 : 1 i� � . rn . lI . PLEDGE OF ALLEGIANCE - �ommis_=, ioner Pr�wer [ II . ROLL CALL Present : t�:cu�ed Absence : V i c� Cha i rm�n Jo� G i E�bs :�omm ; ss i oner �I i ke I sbe 1 1 C:ommi �s i oner Patt i i�ower Commi ;.a i onFr �oi s iient Chairman ��bby J�nathan A I SC, Pt'PSE'flt : Jean M . Benson , Cc�unc i 1 i_ i a i son Dc�ug Phiii9ps , C'eputy City AttorneY :�heiia R . Gilliaan , City C; lerk/P . i .G. hlary P . Frazier , Secretary IV . OLD BUSINESS A . c�i-�NSIDERATitiN c�F 't_ETiER rR��M M� . JIM [;Ui_DSTFIi�� ATEG N��VFMBE �t 1 i� , ) 9L�r� , RELATIVF 7�i A�;;ESSMEl��T �F FAYMENT OF� J . K . M�?�AN ' S E3I � L. FOR Ii�DIAN SPR 1 NC�S MC�B l L E HCiME PARK PET I T I ON F OR NARC�SH I F' �ENT tNCREASE . Gha i rm.� n Jonathan stateci th�3t sevr�r� i nf the Commissiar:ers had ex:prPssed concern �ei �tive ro �:�aym?nt �zf 'r. ha b i i i ror Mr . ,J . K . hi�r,��n . He �asked for �:ornrr�ents fr�m hirs . Gi i 1 igan anr� M .� . Phiili ��s regarding this matter . MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING DECEMBER 15, 1986 � � * � � * � . * � � * * * . * . � � � * # Mrs . Giiligan reviewed the seiectinn of Mr . Moran � s hearing �fficer- in this pptition f�r h�rd�hip rent incre� se , nnting that Mr . Moran had been chasFn because of his background in rPnt conrrol . The City had subseq�aently received compl � ints from Mr . Goidstein , the park nwner , statin�� that Mr . Moran was � iased in f�vor of the tenant � . The Rent Rev i ew Cnmmi sG i a� h.�d then met �nG r_�ia 1 d t= i nci no ev i dence of b i as on thP p�rt of Mr , M�ran but der_ ide� to retain Mr . Rick Frwoc�cl as the hear i ng off i cer for th i s case . 5ne acided that- th i s meet i nc� har� then been scheciui Pd bP .r.ause of iPtters received from two of the CommissionPrs , Mr . Phillips statFcJ that if the Commissit�� decided to resr_ ind its previous decision reiative 1-o payment of Mr . Moran ' s bili , a unanimous vote woufcf be nere, sary. He reviewed the memorandum dated Decembe� 15 , i486 . (on file anci �f rerord in the C: ity c-: iPrk ' s Gtfice ) noting that the guidelines and �rdinanr_ e ailowed the Commission ta ch�ose any of fihe options listed . l.ipon q�_iestion by Ms . Fower , Mr . Pniiii �s responded fihat Mr . Mor�n h�d alre3dy been �aid and thar the f i rst t i me tne C i ty became aware fihat Mr . Ma�an had represented G . ti . M . O . L . ( Golt� en State Mohiiehome Gwners League , Inc . ) was at the November 3rd Commission meeting . Upon question by C:h� irman Jc�nathan , Mrs . Gilliq�n resp�nded that Mr . Moran ' s hiil was primarily for rc>v i ew i ng mater i a 1 prav i cied k�y the park owner and th? City . She added th�t Mr . Moran had also met witri her rpgarding the City' s ordinance and past history oF Indian Springs MobilP Hame Park . The b i 1 I a 1 sa i nvo 1 veci te 1 e}�hone ca 1 1 s tc the C i ty and a ietrer suhmitted ta Mr . Goidstein . Mr . Gibbs asked if the City would have the optian of pur su i ng th i s matter to see i fi some of the money paid t� Mr . Moran couid he recovered , and Mr . Phillips stated that the Commission �ould make th�t recommFndatic�n to the City Coun�� il . z � MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING DECEMBER 15, 1986 . . * � * � . � � ,� * � . * � . � . � . . +� Upon quest i on by i�ha i rman Jonathan , Mrs . !:� i 1 1 i qan responded that Mr . M�ran was to be �iaid � 125 per haur to i nr i �_!r_r' e sery i ng as hear i ng off i cer , preparing for the hearing , writing a re�ort ofi findings and recommendation , and attendinq the Rent Review Cammisaion meeting . Mr . Ph i 1 1 i ps asked whetner Mr . E: rwo�d had u:�ed �ny of Mr . Moran ' s work . Mrs . Gilligan res�onded that with the exceptian of reviewinc� Mr . M�ran ' s letter tr� Mr . Goldstein , Mr . Frwood hau not u�ed any of that information . Mr . Gibbs statecl that he had been surprised t� see Mr . Moran at thn Novem;�er 3rd Commissiqn meet. ing as the hameowners ' repre�entarive and tha� he h�d submitted a ietter dated Navember 18th bec�use nf his conrern regarciing Mr . M�ran ' s objectivity . He ,aid he felt it would be �jnfair to impose this on the park ownPr or the home- owners . He str�nc� iy recommendeci th�t the Citv Counci � look into t7is matter and t�FCP any action they wauld c�nsider appropriate . Commissionar Pawer stated she agreed with Mr . ribbs ' comments and acided that she did not think the City shoul � be penalized either . Cha i rman Jr�nathan ac�reed and stated that he i-�ad also written a letter to the City expressing concern . He st�ted he dic� n�t feel Pither side shoulci be made to pay f�r the selection of Mr . Nloran . Mr . Philiips siatPd th�t half of the bill 'nad alreadv been reimhurse� to the City out of the registration fee fund. 3 . � . i MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING DECEMBER 15 , I986 . * � # . � . . � � � t � . . * . * : � . � Mr . Gibbs moved to : I ) Rescind the Commis � ion ' s prev i ous dec i s i on requ i r i ng th�t ha 1 f c�f Mr . Moran ` s bi 1 1 be paid by Mr . Goidstein and half by the homeowner� ; ?_ ) Rer.ommend to the C i ty Counc i 1 �hat I 00% of Mr . Mor�n ' s k� i 1 1 be pa i ci from the City ' s Generai r �and , with the registratior fee fund heinq reimbursed far the �mount alreadv charged ; 3 ) Recommend that t`�e City Council take whatever stPp, necesaary to recaver the amount paid to Mr . Moran , �2 , 237 . 75 ; an�i 4 ) Advise Mr . Gol �stein i�hat ha 1 f of Mr . R i ck Erwood ' � b i I 1 i s st i 1 1 t� be �� i d by h i rr , M�tion was seconded by Ms . Fower anc� carried hy unanimo�.is vote of the C�mmission members pre-ent . V. ADJOURNMENT With ronsensus nf the Commission members present , Chairman Jonai-han adjo�_arned the mePting at 4 : 28 p . m . � ,, , L. / '�.— 5ABBY ATHA , C AIRMAN A�fTEST: ��. �•---�?�.�-�.-' `'��" �\, �� MARY P . �ZIER , SECFt— E---�RY �� 4 MINUTES PALM DESERT RENT REVIEN COMMISSION MEETING MONOAY, AUGUST 17, 1987 CIVIC CENTER COUNCIL CHAMBER * � � * # � � � � � � � � � t . * t f * � * * � . Deputy City Clerk Mary Frazier administered the Oath of Office to newly appointed Rent Review Commissioners Wanda Tucker , Joyce Wade-Maltais , and Randall White. I . CALI TO ORDER Chairman Jonathan convened the meeting at 4 : 10 p.m. II . PLEDGE OF ALLEGIANCE - Commissioner Joyce Wade-Maltais III . ROLL CALL Present : Excused Absence : Commissioner Wanda Tucker Commissioner Michael Isbell Commissioner Joyce Wade-Maltais Commissioner Randall White Chairman Sabby Jonathan Also Present : Jean M. Benson , Council Liaison Doug Phillips , Deputy City Attorney Jeff Patterson, Contract Attorney Mary P. Frazier , Deputy City Clerk/Secretary IV. APPROVAL OF MINUTES A . MINUTES of the Rent Review Cornmission Meetings of August 4 , November 3 , and December 15 , 1986. Chairman Jonathan explained that these Minutes were for meetings held by the previous Rent Review Commission , of which he and Commissioner Isbell were the oniy remaining members , and they had not yet been approved. He stated that he was not present at the August 4 , 1 986 , meet i ng and recommended that approval of those Minutes be continued to the next Commission meeting inasmuch as Commissioner Isbell was not able to attend this one . He recommended approval of the Minutes of November 3 and December 15 , 1986 . Commissioner Tucker moved to continue approval of the Minutes of August 4 , 1986, to the next Commission meeting and to approve as presented the Minutes of November 3 and December 15 , 1986 , based upon the recammendation of original Commission member Sabby Jonathan. Motion was seconded by White and carried by unanimous vote of the Commission . MINUTES PALM DESERT RENT REVIEN COMMISSION AUGUST 17, 1987 f ! • * � f # i f � f f � f ; f t # ! f f # � # ! * V. NEW BUSINESS A. STAFF REPORT on Decision by 4th District Court of Appeal Relative to Portota Palms Mobile Home Park . Mr . Patterson reviewed the history of the June 1985 Portola Palms Petition for Hardship Rent Increase , noting that an increase of $ 19. 05 per month per space was granted after the hearing process was completed. The park owner subsequently went to the local Court for a writ and lost ; he then appealed to the 4th District Court in San Bernardino, which determined that the Rent Review Commission had made an error in not annualizing the $25 . 00 per month rent increase from February 1983 . He reviewed his Analysis of Recomputation (attached hereto and made a part hereof as Exhibit "A" ) . He said that as far as the retroactivity ($263 . 33 per space) , he had checked with other cities , including the City of Santa Monica, and they felt they were authorized to spread the payment of any arrearage over a period of several months because of a potential hardship to some of the homeowners . He said the park owner had also requested that this amount earn interest at the rate of 109. , which the owner had calculated would amount to approximately $52. 00 per space , and that the Court 's op i n i on was s i 1 ent on th i s i ssue . He said the Commission could determine whether or not it wished the $263 . 33 to bear interest . He added that the owner had requested the City' s pa_yment of Court costs in the amount of $ 1 , 106 . 30 and advised that the Commission did not have any discretion on this matter because State law is that the prevailing party is entitled to recover any costs ; however , he said it might be appropriate for the Commission to recommend to the Counci 1 that these costs be paid to the park owner . Commission Questions/Comrnents : White : What is the effect of this decision on subsequent hardship rent increases or cost of living increases with regard to this park? Mr . Patterson responded that it may or may not have any effect . Added that this was the type of case where interest could be awarded on the amount not paid at the legal rate of 10% compounded , which would increase over time. He said 2 MINUTES PALM DESERT RENT REVIEM COMMISSION AUGUST 17, 1987 ! # i # # f ! f f * # # !F � � � # f f f f � f f � f there might also be a question of who would have to pay the arrearage because there may be original homeowners who no longer live in the park or own a mobilehome in the park . Tucker : Felt the retroactive amount might cause a hardship, especially when the homeowners were not expecting it and stated she was in favor of spreading it out over a period of time. Wade-Maltais : Agreed with Tucker and asked for additional information relative to the payment of interest on the retroactive amount . Mr . Patterson explained that computation of the interest would be quite involved and estimated the actual amount of interest would be approximately $25 . 00 per space rather than the $52 . 00 requested by the park owner because of the method of calculating the interest . Jonathan : Suggested the Cornmission hold discussion of each issue until after public testimony was received. He said he remembered when the Commission had heard this case and still felt the Commissioners had made the right decisions . However , reminded the Commissioners that they would be in violation of a Court Order if they did anything other than adhere to that order . Chairman Jonathan invited tesimony from the audience. MR . LARRY HORWITZ of Hart , King 8 Coldren , 200 East Sandpointe, Suite 400 , Santa Ana , 92707-0507 , spoke as the representative of the park owner , Mr . Natter, and asked for clarification of Mr . Patterson' s Analysis of Recomputation relative to using 22 months to calculate the retroactivity. Mr . Pattterson stated that the request from the park owner was that it be retroactive to July 1985 . He said the Commission , by ordinance , had the authority to make increases retroactive to 30 days after the petition for hardship rent increase is filed . However , when the Commission heard this case and reached a decision at its meeting of September 11 , 1985, it determined that the $ 19. 05 per month was not to be retroactive to July 1985, and he did not think the Commission would wish to make this change 3 MINUTES PALM DESERT RENT REVIEN COMMISSION AUGUST 17, 1987 f # t f 1 # ! * # f f ! f * t ! !� ! f f iF iF ! f # f retroactive either . He said the 22 months was computed from November 1985 to August l , 1987 . Mr . Horwitz asked that it be calculated through November 1987 because he felt it would take until then for this increase to become effective . He added that although Mr . Patterson had calculated that the amount which should have been granted was $31 . 02 per space per month, his figures were different . He felt the Court of Appeal made it clear that it approved the amount which had been requested by his client at the time the petition was filed, which was $33 . 13 per space per month . Mr . Patterson explained that in the course of testimony during the Evidentiary hearing and Commission meeting, the amount was reduced to $31 . 02 because certain items were not allowed. Mr . Philiips stated that the difference between those two f i gures d i d not re 1 ate to the i ssue addressed by the Court of Appeal , which was the annualization issue . Chairman Jonathan suggested continuing this matter to another date so that Mr . Patterson and Mr . Horwitz would have an opportunity to go over these differences . Mr . Phillips stated it wouid be to discuss the mathematical computation of the amount of the arrearage, the issue of spreading payment of the retroactive amount over a period of time, payment of interest on that retroactive amount , date of the retroactivity , and what to do with regard to homeowners who have moved since the original Rent Review Commission decision. Commission Wade-Maltais asked that the Commission be given a report of the meeting between Mr . Patterson and Mr . Horwitz well in advance of the next meeting so that each Commissioner wouid have time to study it . Commissioner Wade-Maltais moved to continue this matter to 4 : 00 p.m. on Monday, August 31 , 1987 . Motion was seconded by Tucker and carried by unanimous vote of the Commission . 8. STAFF REPORT on Decision by 4th District Court of Appeal Relative to Indian Springs Mobilehome Park . 4 MINUTES PALM DESERT RENT REVIEW COMMISSION A�GUST 17, 1987 f �F �F �! • i !� iF iF iF • iF iF �F �F iF f f iF iF f 1F iF # 9F iF Mr . Patterson reviewed the history of this case, noting that in 1985 a Petition for Hardship Rent Increase was filed. An evidentiary hearing was held, and the Rent Review Commission rendered its decision. The park owner subsequently took the matter to the local Superior Court for a writ of mandate ; the case was lost on the local level , and the owner appealed the dec i s i on to the 4th 0 i str i ct Court of Appea 1 , whi ch found that the Commission should have given the owner , as a separate expense, $ 100 per space per year and should have made some of the various other allocations differently, resulting in an additional increase of $6 . 92 per space per month . He added that when the decision was sent back to the local Superior Court by the Court of Appeal , the judge who heard the rnatter on the local level was not available to sign the Court Order , which was a writ of mandate directing the Commission to recalcu )ate the increase . He said the judge would not return from vacation until August 24th . Mr . Phillips explained the Court procedures with regard to this issue. He stated the Commission could , if it wished , listen to testimony from the audience and then continue this item to August 31st along with the Portola Palms matter . Commissioner White moved to continue this matter to the meeting of August 31 , 1987 , in order to have the issues ciarified by Mr . Patterson , and not to accept pubiic testimony at this time . Mr . Phillips stated that this had been legalty advertised as a public hearing and that problems might be created if people in the audience were not ailowed to speak. The motion died for lack of a second. Chairman Jonathan invited testimony from the audience and asked everyone to keep in mind that the Commission was not as familiar w i th the i ssues as the peopl e i nvol ved and that there wou 1 d be ample opportunity on August 31st to which date the Commission would be continuing this item. MR . ALLEN PERRIER , 3001 Tahquitz- McCallum , spoke as the representative for Mr . Jim Goldstein , owner of Indian Springs . He said he felt the issue here was not very complicated and that he had g i ven a copy of the Court of Appea 1 judgement to Mr . Patterson . He said there were capital expenditures of $26 , 090 5 MINUTES PALM DESERT RENT REVIEN COMMISSION AUGUST 17, 1987 f # � i� i # f f � * � f f �1F f * # f * � # !F � # t * which, under the guidelines at that time, were determined to be of a capital nature. The Commission , in treating that expense �nder the Net Operat i ng I ncome ( NO I ) formu l a i n the year of application , decided to amortize all of those expenses over five years . The Court found that the Commi ss i on had erred i n i ts treatment of these expenses and should have expensed the first $ 19, 100 and amortized only the difference between the $ 19, 100 and the $26 , 090 . He said by his calculations , the amount of the increase should be $6 . 92 per space per month , and he felt his client was also entitled to receive interest on the amount of the arrearage . He said he did not feel the Commission had the jurisdiction to inquire into the hardship of the tenants in pa,ying this amount and whether or not it should be spread over a period of time . He added that he felt the Commission had the authority to act at this time, without having to wait until the Court Order is signed by the judge . He said he would be out of the country on August 3 1 st and asked that the matter not be continued to that date. MS . JOAN BAUMGARTEN , 81 - 730 Highway 111 , Indio, spoke as the attorney for the residents of Indian Springs . She agreed that the Commission had the jurisdiction to hear the matter today and said she did not know of anything in the law which would prohibit taking action when the Commission knows what the Court decision wili be . However , she disagreed with the interpretation of the action mandated by the Superior Court Order. Mr . Phillips stated that he did not have a problem with going ahead with this matter without having the Court Order and that the language of the Court of Appeal decision was very clear . Mr . Patterson stated he was concerned with the $ 19, 100 per year for the expensing of capital improvements . He said the Commission discussed in depth during the hearing whether or not the $6. 92 increase should be in perpetuity or whether it should be for just one year . He felt this was a complex issue and one which he was not prepared to address at this time. Upon question by Chairman Jonathan, Mr . Patterson responded that the Court Order says give the park owner $6. 92 per space per month increase. Ms . Baumgarten disagreed and stated that the Order directs the Commission to recalculate the increase by treating the $ 19, 100 as 6 MINUTES PALM DESERT RENT REVIEM COMMISSION AUGUST 17, 1987 # #� # � � # jF i * f # f f f iF ! f f • # !� • iF f f iF an expense, which she said did not translate into a rent increase of $6. 92 . Comm i ss i oner Wh i te stated that as a new Comm i ss i oner he was not familiar with the Indian Springs problem and the Appellate Court decision . He felt the matter should be continued because the Commission did not yet have the Court Order or the findings of fact from the hearing officer with which to base a decision . Commissioner Tucker agreed that the Commission should listen to the public testimony at this time but felt the Commission needed additional time to review the information prior to making any decision . Commission Wade-Maltais felt it was not a simpte matter and that it should be continued. Chairman Jonathan agreed with the Commissioners ' comments . Commissioner Wade-Maltais moved to continue this matter to Au�ust 31 , 1987 . Motion was seconded by Tucker . Commissioner White stated that if this date was inconvenient for any of the parties , the Commission should ailow the date to be changed. Commissioner Wade-Maltais amended her motion to continue the matter to a date convenient for all parties . Commissioner Tucker amended her second, and the motion carried by unanimous vote. Ms . Baumgarten submitted documents which she fett would help the Commissioners in reviewing the case and making a decision (on file and of record in the City Clerk' s Office) . She reiterated her earlier comments that the Appellate Court decision did not specify that the Commission shall give the park owner an additional $6 . 92 per space per month and did not say interest must be included . She said the decision directed the Commission to recalculate the increase and treat the first $ 19 , 100 in capital expenditures as an expense. She said the petition used 1984 f i gures to pro,ject the amounts for 1985 because complete figures were not yet available for 1985 . She submitted copies of completed financial statements for 1985 for Indian Springs , noting that no capital expenditures were listed, which meant the owner did not spend that money and , therefore , the amount included in the petition was excessive . She also distributed 7 MINUTES PALM DESERT RENT REVIEW COMMISSION AUGUST 17, 1987 : f � f � . � * � . # � t * f . � f � � � � � # t : copies of the revised petition which had been submitted by the park owner and stated she had added an extra column showing the act�al audited figures which were not available at the time of the original hearing . She felt it was appropriate for the Commission to consider these figures when catculating any rent increase . She concluded her report by stating she felt the Court of Appeal decision intended that the Commission authorize the park owner to charge the homeowners for the improvements that were actua 1 1 y made ; i f the Court i ntended to s impl y grant the $6 . 92 increase, it would have said that . Mr . Perrier stated that these were legal issues on which the Commission has little or no discreation . The Court of Appeal has said that the manner in which the increase was determined shall be recalculated, and it did not say the case is to be retried or that new evidence is to be considered . The recalculation is to be based on capital expenditures of $26, 100 and to treat the first $ 19, 100 of that as a capital expense . Mr . Phillips stated he had looked at the Court of Appeal decision and felt the matter should be continued to allow the Commission an opportunity to become familiar with that decision. Chairman Jonathan suggested that the City staff work with alt parties involved and schedule a date and time convenient for everyone . The Commission concurred. VI . ORAL COMMUNICATIONS None V. ADJOURNMENT Upon motion by Tucker , second by White, and unanimous vote of the Commission , Chairman Jonathan adjourned the meeting at 5 : 51 p. . � SABBY JO TH , CHAIRMAN ATTEST: ; �`��.'L-�-- ��..J �_�')��_ ;)L.,, MARY P. FR IER , DEPUTY C .�Y CLERK/SECRETARY TO THE PAL DESERT RENT REVIEW COMMISSION 8 ----- --------- ----.. M I NUTES --___ _ -__ ___ PAIM DESERT RENT REVIEw COMMISSION AUGUST 17, 1987 . � . DJE1�/2� . * � . � � ,� f . � � � . � � . � � � * EXHIBIT "A" CITY OF PALM DESERT MOBILE HOME PARK RENT REVIEW BOARD AUGUST 17, 1987 ANALYSIS OF RECOMPUTATION PORTOLA PALMS MOBILE HOME PARK The Court of Appeal, Fourth Appellate District (Division Two) has considered the park owner' s appeal and directed the Superior Court (in Indio) to issue a writ of mandate directing the Palm Desert Rent Review Commission to set aside its decision of September 11 , 1985 (which granted an increase of $19. 05 per space per month) , and to recalculate the hardship rent increase. The Court basically said that the Commission should have treated the February, 1983, $25. 00 per month rent increase as though it had been received throughout the 1982 calendar base year. I. AMOUNT OF INCREASE: The amount of the increase should have been $31 . 02 (the original required rental increase of $19. 141 plus $25 . 00 per month for 9 months for 130 spaces: $19. 141 + $29. 250 = $48, 391 divided by 12 months divided by 130 spaces) . The Commission gave a hardship increase of $19. 05. The park owner should be awarded an immediate increase of $11 . 97 per space per month! II. RETROACTIVITY: If the Commission had made the proper determination, the increase would have been in effect since November 1 , 1985 (22 months) . Each homeowner� owes $263 . 33 ! The Commission must decide if it will spread this over time. III. INTEREST: The park owner has requested that this amount bear interest. The Court' s opinion was silent on this issue. IV. COSTS: The Commission should recommend to the City Council that Court costs of $1 , 106. 30 be paid to the park owner. L a J F RY .R. PATTERSON Fe ing fficer �� : � ��. �c�Y }��C��y �^ .. a x� !a�^{ r.. �y �� ' � 1',: . �.,�: MINUTES PALN QESERT RENT REVIEW COMMISSION MEETING MONDAY, AUGUST 31 , 1987 * f f �lF iF f # IF # iF i * f f * ! * * f 1F iF i # # f I . CALL TO ORDER Chairman Jonathan called the meeting to order at 4 : 00 p .m. II . PLEDGE OF ALLEGIANCE - Commissioner Randall White III . ROLL CALL Present : Commissioner Michael Isbell Commissioner Wanda Tucker Commissioner Joyce Wade-Maltais Commissioner Randall White Chairman Sabbv Jonathan Also Present : Doug Phiilips , Deputy City Attorney Jeff Patterson , Contract Attorney MarY P. Frazier , Deputy City Clerk/Secretary IV. APPROVAL OF MINUTES A . MINUTES of the Rent Review Commission Meetings of August 4 , 1986 . Rec : Approve as presented with the recommendation of Michael Isbell , an original member of the Commission . Commissioner Isbell recommended that these Minutes be approved inasmuch as he was the only remaining member of the original Rent Review Commission present at that meeting . Commissioner Tucker moved to approve the Minutes of August 4 , 1986 , based upon the recommendation of Commissioner Isbeli . Motion was seconded by Isbell and carried by unanimous vote of the Commission . B . M,,.[ NUTES of the Rent Review Commission Meeting of August 17 , 1987 . Rec : Approve as presented. Commissioner White moved to approve the Minutes of August 17 , 1987 , as presented . Motion was seconded by Wade-Maltais . MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING AUGUST 31 , 1987 � � # � � � � � � � � . f t . * � * * � a * * * * � * � �� "�'� �� ; a C `¢�y� �� . {h r 4 . y,.. `�1�� ifl � 4� � A�'� i } }�S�ii ��.r:3��'li� !"1 a � P�b P Commissioner Tucker noted that the motion at the bottom of page 7 of the Minutes showed that she had "amended her motion" when it should actually say "amended her second" . Commissianer White amended his motion to include the correction noted by Tucker . Commissioner Wade-Maltais arnended her second. Motion carried by a 4-0- 1 vote , with Commissioner Isbeli ABSTAINING inasmuch as he was not able to attend that meeting . V. CONTINUED BUSINESS A . STAFF REPORT on Decision by 4th District Court of Appeal Relative to Portola Palms Mobile Home Park . Mr . Patterson verified that each Commissioner had received a copy of the August 25th ietter from Mr . �arry Horwitz of Hart , King 8 Coldren , who represented the owner of Portola Palms in the lawsuit . He explained that he and Mr . Horwitz had discussed the elements of the case which needed to be decided by the Commission and that Mr . Horwitz understood that their negotiations were not binding on the Commission . He said the August 25th letter outlined the agreements reached betwPen the two attorneys and were in accordance with the decision by the Court of Appeal (on file and af record in the CitY Clerk ' s office ? . He said the practice in some cities was to prepare an order showing Commission action , whereas in Palm Desert , Commission action had always been shown in the Minutes . However , he said he did not have a problem in using an order and attarhing a copy to the Minutes . He said they had agreed that the period of retroactive application would be 26 months . Mr . Patterson stated that one of the elements agreed upon had not been i nc 1 uded i n the Order . That item was that "existing tenants of Portala Palms will only be billed for such retroactive amounts and interest to the extent each tenant was responsible for rent at Portola Palms during the period of retroactive application of the rent increase . " Mr . Horwitz stated he had intentionally left this item out of the Order and would discuss it later during this meeting . Mr . Patterson stated that although Mr . Horwitz indicated in his letter that the retroactive amounts would be paid over a 12-month period , this aqreement had also not been included in the Order . He said it was because the park owner felt inclusion in the Order might create some diFficulty if he 2 MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING AUGUST 31 , 1987 � * * � � * # � � � � * � * f # � � � * * � � * � � y }�{' M� +��'�Q �e ��' r� � ra;nS t�J� �`Y� f. �. �' i�� d F ^ � M�Y,`� .e��! ' �'+";.- ' >.; ��i F � 1 �;;s1 � � � ��'�.�� had to go to court to collect from homeowners who were not paying the retroactive amount . Mr . Phillips explained that the park owner was concerned with being able to collect the retroactive amounts and having to wait for the entire 12-month period to pass before going to court . He said he wouid like to see the 12-month payback provision in the Order and felt one way to mitigate the owner ' s concern was to put in some type of �cceleration clause so that it is understood if a tenant responsible for the retroactive amount failed to pay one of the installments , the owner would not have to wait until the end of the 12-month period to collect his money. Commissioner Wade-Maltais asked how they should explain the increase if asked by a homeowner . Mr . Phillips responded that it should be expiained in this manner : "The current increase is $ 12 . 68 per space per month . In addition to that amount , your rent will be increased to pay for your fair share of the arrearage , and if you were there during the entire 26 rnonths , your fair share would be $30 . 53 per month for the 12-month period . The total wi ) 1 be approxirnately $43 . 00 per month . " Upon question by Commissioner White . Mr . Patterson explained that the period of retroactive application being 26 months was settled upon in exchange for the owner ' s agreement to spre�d out payment of the retroactive amount over a period of 12 months . Upon question by Commissioner Wade-Maltais , Mr . Phillips clarified that in this case . it was specifically ordered reimbursement of costs incurred by the park owner in connection with this appeai . Upon question by Chairman Jonathan , Mr . Phillips clarified that a new tenant moving into the park would only be respansible for the $ 12 . 68 per month increase , not any retroactive amount . Chairman Jonathan invited testimony frorn the audience . MR . LARRY HORWITZ , Hart , King & Coldren . spoke as the representative for the park owner . He reviewed his letter dated August 25th , expressing his client ' s concern with the ability to collect the retroactive amounts due . He said he did not think the Commission shouid be involved in figuring the specific rent increases for each individual space and 3 MINUTES PALM DESERT RENT REVIEM COMMISSION MEETING AUGUST 31 , 1987 � i f � f �F # * � * i iF i 1F 1F �F � f � # ; # �t 1F f iE �� # it. �] �� tGun�ti�' ��`�� x �� i � ` S + that it was something the park owner should have to do . Ne added t hat i f a tenant was unhappy w i th a ca l cu l at i on , i t should be brought to the attention of the park owner or the Commission through the hearing process . Upon question by Mr . Phillips , Mr . Horwitz responded that he did not have a problem in adding the acceleration clause to the Order as long as the net result did not delay formal notification of the rent increase, which he said the park owner would be delivering the followinq day. Mr . Phillips asked Mr . Horwitz what would happen if a current homeowner was in possession of the space for only 13 months of the 26-month retroactive period and stated he understood that homeowner would only be responsible for the 13 months he or she was in possession . Mr . Horwitz agreed. Mr . White asked how the 26-month period was determined . Mr . Phillips stated that if you took the p�sition that the rent increase sh�uld go into effect 30 days after the filing of the petition for hardship rent increase with the Rent Review Commission , you would come up with 28 months for the retroactive period . However , the increase should be effective on the same day the original increase went into effect , which would be 24 months . The compromise was for 26 months . Mr . Horwitz agreed that this was basically the way it was caiculated; however , he said that there were certain issues that his client had elected not to pursue in order to expedite the increase . MR , WILBUR VALLEY stated the homeowners were concerned with the compromise and felt funds had been compromised which could have been used by people in a needy position . He said they also disagreed with having to pay interest on the amount af the retroactive rent increase . Mr . Patterson explained that if the compromise had not been reached , the homeowners could have had to pay as high as $ 16 . 91 per space per month instead of $ 12 . 68 . He stated that he had the interests of the homeowners in mind when he was negotiating with the park owner ' s representative . Chairman Jonathan declared the public testimony portion of the hearing closed . Upon questio� by Commissioner White , Mr . Patterson clarified that if someone moved into the park during the middle of the � MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING AUGUST 31 , 1987 : : t � f � # � � * � : � f f f . � � � � * � * } : �k� � � �� 3� � r;� '.i � s � �. � � t a t s: �� r� ��: - retroactive period, that period woutd owe less in the way of rental arrearage and a lesser interest amount on that arrearage . Cha i rman Jonathan stated he saw no prob 1 em w i th any of the recommendations from Mr . Patterson . Commissioner Wade - Maltais stated she felt both the homeowners ' and park owner ' s concerns had been protected as much as could be . Commissioner Tucker asked if the Order was to be amended per Mr . Phiilips ' requests . Mr . Phillips stated the Order would be amended by adding two paragraphs relating to payrnent of the arrearage over a 12- month period and billing existin� tenants only for the amount of time they were responsible for rent during the retroactive period . He said there would also be an acceleration clause added stating that " if a tenant fails to pay the retroactive amount the tenant is responsible to pay as the installment becomes due , then the full amount of due �nd unpaid retroactive rent plus interest shall become immediately due and payable . " Commissioner Tucker moved to approve the Order as amended by Mr . Phillips . Motion was seconded by tsbell . Chairman Jonathan stated for the record that he felt it was a matter of interpretation in analyzing the $25 . 00 increase and that he disagreed with the .judge ' s interpretation . However , since the ludge saw it differently, the Commission must comply with the Court Order . He said his vote in favor of the motion would be on that basis . Commissioner White agreed and felt the Appellate Court had mistaken the intent of the drafters of the Rent Controi Ordinance . He recommended that the City Attorney' s office look into amending the statutes to more clearly reflect the original intent . Commission Tucker amended her motion to include the recommendation as outlined by Commissioner White. Commissioner Isbell amended his second . Commissioner Isbell stated he had reviewed all of the notes and papers of that original decision and fou�d it not in error at all . He said he would also vote in favar but anly because the Court of Appeal did not see eye-to-eye with the 5 MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING A�GUST 31 , 1987 � � � � t � t � t * * * � � * f � � � � * � * � � * � .� � �y^�7. �.� 1� ��•'��w1�� r�" �}� �J � � ��G { `� r , _�y. k° e. s Ai y�q� �i� .b � °� '��?��:��i d6 6 �bd� `�ac�� Commission . He said he felt the Commission had made a good decision initiallY . He added that his yes vote would be under protest . Chairman Jonathan called for the vote . Motion carried by unanimous vote of the Commission , with Commissioner Isbeli voting yes under pratest . VI . ORAL COMMUNICATIONS None V. ADJOURNMENT With no further business to be discussed at this time , Chairman Jonathan ad.journed the meeting at 5 : 07 p. m. SABBY JONATHAN , CHAIRMAN � ATTEST: MARY P . FRAZIER , SECRETARY TO THE ' PALM DESERT RENT REVIEW COMMISSION 6 MINUTES PALM DESERT RENT REVIEW COMMISSION MEETING MONDAY, SEPTEMBER 21 , 198? # � � � � � � * # � � * . * . * * � t � * * � � * I . CALL TO ORDER Chairman Jonathan convened the meeting at 4 : 08 p .m. II . ROLL CALL Present : Excused Absence : Commissioner Jayce Wade-Maltais Commissioner Michaei Isbell Chairman Sabbv Jonathan Commissioner Wanda Tucker Commissioner Randall White V. ADJOURNMENT Chairman Jonathan announced that ber_ause the Commission lacked a quorum , it would be impossible to conduct business . He , therefore , ad,journed the meeting at 4 : 10 p .m . to d : 00 p.m. on Monday, September 28 , 1987 . SABBY JONATHAN , CHAIRMAN � ATTEST: MARY P . FRAZIER , SECRETARY TO THE PALM DESERT RENT REVIEW COMMISSION . � � .� � INDIAN SPRINGS MOBILE HOME PARK �� 49305 Highway 74 � , Palm Desert, California 92260 '� � � , �� April 12, 1985 SUBJECT: NOTICE OF PETITION FOR HARDSHIP RENT INCREASE FILING AND NOTICE OF RENT INCREASE Dear Resident : Please be advised that the Owner of the Park has recentiv filed a petition for Hardship Rent Increase totalling $34 . 00 per space per month with the City of Palm Desert, pursuant to the City' s "Mobile Home Park Rent Review" Ordinance No. 329 . The petition is necessary in order for the Park Owner to obtain • a just and reasonable return on his property. l Therefore, effective June 16 , 1985 , unless modified by the Rent Review Board, the rent on the space you now occupy will be increased $34 . 00 per month, or such lesser amount as specified in the Rent Review Board' s final decision on this petition. Any resident desiring to review the Park Owner' s petition or obtain a copy thereof, may do so at the City offices located at 73-510 Fred Waring Drive, Palm Desert during normal business hours . A copy of the petition may also be reviewd at the Park Office . Residents may file opposition to the Park Owner' s petition, pursuant to Sub-Chapter 9 . 050 .070 paragraph D of the Ordinance, within twenty (20) days after management files their proof of service of this notice on you with the City. The Park anticipates filing their proof of service with the City by April 15 , 1985 . Sincerely, .�Ca�a. ��'�, Miles Allen Manager , ��a��-��-1 .�x � . �t ,� . � . I�IDIAN SPRIIvGS MOBILE HOME PARK 49305 Highway 74 Palm Desert , California 92260 S TATEMEiv T Ju�y I.S , 1985 Dear Resident of Space No. In accordance with the Notice of Rent Increase served on you dated April 11, 1985 , and in compliance with the Rent Review Board' s decision on the Park Owner's rent increase oetition, the rent on the space you now occupy has been increased $22 .05 per month, retroactive to June 16 , 1985 . �our account now shows the following: J;�ne 16 , 1985 through June 30 , 1985 Prorated Rent Increase $ 11 .02 July 1985 Rent Incr�ase 22 •05 Total Prior Months Balance Now Due 33 . 0? New �onthly Rent Beginning August l, 1985 ��rand Total Cwincr $ Collection of tnis increase shall not constitute any waiver cf the Park Owner' s right to seek legal recourse with respect to �he denial of the petitioned amount of i:.crease . Very truly yours, INDIAN SPRINGS MOBILE HOME PARK ,�.� Q�� , Miles Allen Resident Manager AGENDA ADJOURNED PALM DESERT RENT REVIEM COMMISSION MEETING MONDAY , SEPTEMBER 28, 1987 4:00 P. M. - CIV1C CENTER COUNCIL CHAMBER ■ i f f # f # # f t � ■ f t ! f � f ■ i � � � f ■ I . CALL TO ORDER II . PLEDGE OF ALLEGIANCE III . ROLL CALL IV. APPROVAL OF MINUTES A . MINUTES of the Rent Review Commission Meeting of August l7 and September 2i . 1987 . Rer_ : Approve as presented . Action : V. CONTINUED BUSINESS A . STArF nEPORT �n Decision by 4th District Court nf Appeal Relative to Indian 5prinq5 Mobilehome Park . Rec . Action : VI . ORAL COMMUNICATIONS Anv person wishing to di ; cuss any item not otherwi ;a <,n the Aaenda may address thP Rent Review Commission at this poin 'r bv ster�� ing to the lectern and aivina his /her name ard adhres; ror --_— —__-—_---- - -------------- the rer_ord . Remarks shali be iimited to a maximum of five minutes unless additionai tirne is authori �ed bv the Commissinn . V. ADJOURNMENT , � • � � r �:� '� �� ` � INDIAN SPRINGS, LTD. �' �� DBA: INDIAN SPRINGS MOBILE HOME PARK � C,�`�\ �� y' �� .� . FORECASTED STATEMENT OF CASH RECEIPTS AND DISBURSEMENTS � For the year ending December 31, 1986 � With Audited Comparative Figures For the year ended December 31� 1985 Page Two Forecasted Audited 1986 1985 Cash Re�eipts Total Brought Forward �625,685 $595,777 Operating Expenses Subtotal Brought Forward 162 ,821 148,019 ' Management Expenses: Management fees ([Vote 3 ) 31 , 284 30,189 . Salaries and payroll taxes 27,093 24,630 Accounting 4,525 4,114 Insurance (Note 4) 11 �820 3�790 Office supplies and postage 2,363 2,148 Legal fees 1,935 1 ,759 Advertising 135 123 Total Management Expenses 79,155 66,753 Real property taxes (Note 5 ) 39,099 35 ,916 Licenses� permits and fees 1 ,195 1,445 P 9 P n� 3u2 �-ds N;� ; ��li.�'Nu Total O eratin Ex enses �' 282,270 252, 133 ; .,,.�,�; '; Capital Expenditures (Notes 1 & 6 ) 34,866 0 a�„ ,� ,�, ; 3 Y�ti:..i Concessions to tenants 1 ,210 1,100 Debt service (Note 7 ) 586,U92 462,426 ;�G_,� ; }„3_�4� Refinancing costs and expenses 0 40, 724 i,vG� �� ,;:5 Rent Control Expenses 8, 757 8, 757 Total Cash Disbursements (Note 1 ) 913,195 765,140 Excess of Cash Disbursements Over Cash Receipts (287 , 510) (169,363 ) SEE ACCOMPANYING SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND SIGNIFICANT FORECAST ASSUMPTIONS v � �. .. . C � PALM DESERT RFSI'P REVIEW COMMISSION IN THE MATTER OF THE PETITION OF INDIAN SPRINGS MOBILE HOME PARR FOR A HARDSAIP INCREASE IN RFsi'PS This matter having come before the Palm Desert Rent Review Commission this 21st day of September, 1987 on the Petition of Indian Springs, Ltd. (herein "Applicant" ) for a hardship increase in rents filed with this Commission on April 3 , 1985 in view of the following circumstances: A. On April 3 , 1985 Applicant filed with this Cammission its Petition for a Hardship Increase in Rents; B. On July 10, 1985 this Commission granted Applicant a hardship increase in rents of $22 . 05 per space per month; C. On August 30, 1985 Applicant filed with the Superior Court for Riverside County, Californ�a its Petition for a Writ of Mandate requesting the Court to order this Commission to recalculate the hardship increase in rents granted July 10 , 1985 by treating the first $19,100 . in capital expenditures as an operating expense which Petition was denied by a Superior Court Judgment; D. Appellant appealed the Superior Court Judgment to the Court of Appeals for the Fourth Appellate District and the ,� -1- . , � ' • _. � ' Ur. • . C �,C � � t Appellate Court by its decision entered June 16, 1987 reversed � � v . the Judgment of the Superior Court an d or dere d t he Superior Court Q � � � t o i s s u e i t s W r i t o f M a n d a t e d i r e c t i n g t h e C o mm i s s i o n t o s e t � d �1 aside its July 10, 1985 decision of $22.05 per space per month .� � � � increase in rents and to recalculate the hardship increase in � � � rents by treating the first $19,000 . in capital expenses as an �' � � � 6 � operating expense; � � �� ^ 1 E. The Applicant is entitled as a matter of law to a S `� .c hardship increase in rents, retroactive to July 10 , 1985 of �� s � � $28 .97 (which amount is $6 . 92 more than $22. 05 per space per 3?'� � � �o � � month ordered on July 10 , 1985 ) together with interest on $6.92 ,� _ 9 per space per month at the rate of l0o per annum from July 10, � •� � o .c 1985; � � � F. The aggregate amount of increased rents and interest due � �q$� � pgc- SPp+w d o� and payable as of November 30 , is $223 .04; � � � G. The Applicant, although not obligated to do so under � ��'.� the laws of the State of California or the ordinances and oc1 Ci ) � regulations of the City of Palm Desert, has�j�stipulatednthat it £ � � r will accept, during the period from December 1, 1987 to November � a� � 30, 1988, payment of the increases in rents granted by this S .� .� Commission and the interest due thereon, by 12 consecutive � 3 � L monthly payments of $19. 51 per space beginning December 1, 1987 ,� �' � . � Q� and through November 30, 1988 and that thereafter (beginning `' — � December 1, 1988) the increase in monthly rents of $6 . 92 per � � space per month� � �— NOW THEREFORE, it is the Decision and Order of this Commission as follows: �• -2- • " • . � � k � • 1. The decision of this Commission of July 10, 1985 granting the Applicant a hardship increase of $22 . 05 per space per month is hereby set aside; 2. The Applicant is granted a hardship rent increase of $28 .97 per space per month retroactive to July 10, 1985 by virtue of recalculation of the hardship increase by treating Petitioner' s first $19,100 . in capital expenditures as an operating expense under the NOI formula; 3. The Applicant is entitled to interest on the increase of the Commission' s award of - �6 . 92 per space per month retroactive to July 10, . 1985 and through payment in full; 4. Each homeowner has the option to discharge all rental increases awarded by this Commission by either ( a) the payment of $223 .04 per space on or before November 30 , 1987 and an increase of $6 .92 pez space per month in rent from and after December .1, � 1987 , or alternatively; (b) the payment on the first day each du�2in¢, month1the �eriod from December 1, 1987 through November 30, 1988 of i�s�� t a a � ' �~--} of !�$19 . 1 per space per month and by the payment of increased rent commencing December 1 , 1988 and thereafter in the sum of $6 .92 per space, per month. 5. A homeowner may take advantage of option (b) of Paragraph 4 (and by such payment shall be conclusively presumed to have done so) only by paying the first installment of $19 . 51 on or before December 1, 1988 . ��(P1� Dated this day of September, 1987 . CHAIRMAN -3- .. " , . • . - ,. (� . " �� h o��.a�r�e� �a � (s -�-o p�y cvh evv clu e� � �N �ns1-a I m�.x�"P�y�nen-� p/zo�� (. �,rz� he� �n� -t-h � N� �I I rarn o�n t �� pg��(� � �"�� h� �om� J m me.�. ��f�.t� au� �� p�� R��. 7 ��a�n� Q�av�.�v wh � f�� 1`��ii�s /�-,�/�'� o�v �y /G, !�t�S' Sh�-l I b e� 1 � ►�► a�v �� a�u -,�►► �►�c�r�s c� rr�nts �n.� ��i frrr�sf �ccr�,v� n� AFf�� s�� e-til �' /�s�svrnc� ,Das�s�an� �}�J� �?,�-f- r��c� /.�b,i,5' , rh� y b� �•�,�y � 6 y �,,� /�Sf�r�7c� �'l�h oq� ��v fhe� s,�c, C'/�s h�� s p by pr.�v�r��hs 4, 5 nrn..� �� b�. INTEROFFICE MEMORANDUM City of Palm Desert T0: Rent Review Commissioners FROM: Sheila R. Gilligan , City Clerk/P. I .O. DATE: June 17 , 1988 SUBJECT: Determination of Terms of Office for Rent Review Commissioners RECOMMENDATION : By Minute Motion , adopt the recommendation of the City Clerk as described below. BACKGROUND : Pursuant to provisions of the ordinance establishing the Rent Review Commission , terms expire in January. The City Council asked that the Rent Review Commission stagger the terms of its members so that no more than two Commissioners are replaced in any one year . Because Sabby Jonathan and Mike Isbell have been members of the Commision since its inception, it is my recommendation that these , m ire in terms ( Joe Abbondondola fills Sabby Jonathan s ter ) exp January, 1989, subject to reappointment . To be fair , we drew lots , with the result that the terms of Joyce Wade-Maltais and Wanda Tucker would expire in January, 1990 , with Randali White' s term expiring in January, 1991 . If you have any questions , please let me know. _� � in; ;;:° �''�,� , � � SHEILA R. GILLIGAN , TY CLERK SRG:mpf