HomeMy WebLinkAbout1998-03-04 HC Regular Meeting Agenda Packet PALM DESERT REDEVELOPMENT AGENCY
INTEROFFICE MEMORANDUM
DATE: March 4, 1998
TO: Carlos Ortega, Executive Director
FROM: Teresa La Rocca, Housing Programs Coordin
SUBJECT: Housing Projects Update
+ Building Horizons
Framing has commenced and work is well underway. Working with Building Horizons
and our legal counsel to verify that all required information has been submitted prior to
release of any funds. Deed of Trust on lots 9 and 10 and the Regulatory Agreement
have been forwarded for recording by the City Clerk. Building Horizons is working with
local realtor to identify families of lower income.
+ Portola Palms Mobile Home Park
The Acquisition Association has paid the two past due property tax installments for the
37 spaces. Financial review of the records held by Desert Management for the
Acquisition Association has been completed and our auditor has verified that the
amounts charged on a monthly basis have been consistently applied and there is no
evidence to lead him to believe that the homeowners fees were improperly charged and
that there is no indication of improper expenses. Any account balance remaining in the
Acquisition Association account will be returned to the Agency upon transfer of the
property.
+ Silver Spur Mobile Home Park - Proposed Ordinance
The Housing Advisory Committee reviewed comments from Helene Dreyer of Best, Best
and Krieger regarding a proposed ordinance for conversion of mobile home parks from
the City of Westminster. Helene recommended that adoption of such an ordinance by
the City of Palm Desert would be beneficial. In doing so, she suggested that the
Westminster Ordinance be used as a starting point for developing a conversion
ordinance. The Housing Advisory Committee requested a work session with Ms. Dreyer
to review her comments and better understand the type of ordinance that she would
propose. That meeting will be held at the next regularly scheduled Housing Advisory
Committee meeting of March 11, 1998.
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PALM DESERT REDEVELOPMENT AGENCY
INTEROFFICE MEMORANDUM
DATE: February 2, 1998
TO: Carlos Ortega, Executive Director
FROM: Teresa La Rocca, Housing Programs Coors Mato
SUBJECT: Housing Projects Update
+ Building Horizons
The Affordable Housing Agreement has been signed by Building Horizons and
returned to the City Clerk for the Agency's signatures. Construction is underway.
There are currently 16 students in the program. 15 from Palm Desert High School.
The foundation has been poured and they will begin framing on or about February
r... 2nd.
+ Portola Palms Mobile Home Park
It has recently come to light that the last two property tax installments for the 37 spaces
owned by the acquisition Association have not been paid. Staff is currently in the
process of having a financial review and report on the status of the Acquisition
Association funds prepared to determine whether there is an unbalance with which to
pay all or a portion of said delinquent taxes prior to accepting and recording the Deed
in Lieu of Foreclosure. This process will take approximately one week.
+ Silver Spur Mobile Home Park - Proposed Ordinance
The Westminster Ordinance pertaining to the conversion of mobile home parks has
been reviewed by Best, Best and Krieger and an analysis prepared. The analysis will
be taken before the Housing Advisory Committee at their next regularly scheduled
meeting for review and discussion.
Page 1 of 2
+ Home Improvement Program
There are currently x number of applications being processed as follows:
7 Grants
1 Loan
2 County/City Joint Loan Grant
To date, one grant rehab and one matching fund loan have been completed.
The work being conducted includes roof replacement; fence repair; painting of exterior; block
wall repair; landscaping; ceiling repairs; electrical repairs; stucco repairs; plumbing and garage
door replacement.
+ Housing Authority Apartment Acquisition
On January 28, 1998, the Bond Issue for acquisition of the seven Housing Authority
properties closed and on January 29, 1998 the real estate escrow closed and the Palm
Desert Housing Authority took possession of the 725 units. Management has been on
site transitioning over the administration of the properties for the last two weeks. Site
staff has been hired and tenants notified of the transfer of title to the properties and
introducing them to the RPM Company. The transition is going relatively smoothly for
a transfer of this magnitude. RPM will immediately begin reviewing necessary repairs
and improvements and proceed with the rehab process. All tenants incomes will be
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recertified and rent-adjusted accordingly.
+ Santa Rosa Apartments
Staff has been working with numerous local contractors in negotiating prices for the
necessary rehabilitation work. In addition, staff will work closely with RPM Company who
will provide assistance with major rehab work in conjunction with the rehab work being
handled at the seven newly acquired properties in order to reduce costs. Those
improvements will include roofs replacement, grading and parking lot improvements.
Rehabilitation work is scheduled to begin within 30 days.
+ Desert Rose
As of January 30, 1998
151 Units have been sold today
131 Escrows have closed
20 Escrows currently open
10 Units remain unsold
TERESA L. LA ROCCA
Housing Programs Coordinator
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Page 2 of 2
+ Home Improvement Program
There are currently 11 applications being processed as follows:
5 Grants
3 Loans
2 County/City Joint Loan/ Grants
1 Matching Fund
To date, two grant rehab and one matching fund loan project have been completed. In
addition, seven applications have been mailed out to prospective participants.
The work being conducted includes roof repair and replacements; replacement of windows,
doors including garage doors, fence repair; painting of exterior; block wall repair; landscaping;
ceiling repairs; interior electrical repairs; stucco repairs; plumbing and flooring repairs, etc.
Yard signs will be installed at each participating property next week.
+ Housing Authority Rental Units
See attached Housing Authority Rental Unit report.
+ Santa Rosa Apartments
Staff is waiting for the contractor to provide a performance bond in order to commence
rehabilitation work. All contracts have been negotiated and agreed upon. Work will
commence on or about March 16, 1998.
+ Desert Rose
As of February 13, 1998
153 Units have been sold today
132 Escrows have closed
21 Escrows currently open
8 Units remain unsold
TERESA L. LA ROCCA
Housing Programs Coordinator
TLR:dcl
Page 2 of 2
.� Minutes
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CONVENE 3:40 p.m., Tuesday, December 23, 1997 (Special Meeting)
ROLL CALL Members Present: J. Richards, Carrie Wick, G. Holmes, J. Benson
Members Absent: W. Winfield
Others Present: T. La Rocca, Charlene Sumpter, Diana Leal
Guests: None
ORAL
COMMUNICATIONS None.
MINUTES It was moved by J. Richards and seconded by G.A. Holmes to approve
the minutes of the October 8, 1997 meeting. Motion was carried to
approve the minutes.
NEW BUSINESS A. ACCEPT JIM RICHARDS RESIGNATION FROM COMMITTEE
Motion moved by J. Richards and seconded by Carrie Wick to
postpone acceptance of resignation until the next Housing Advisory
Committee Meeting. Motion carried.
B. PROPERTY MANAGEMENT SERVICES-REVIEW OF PROPOSALS
Motion moved by J. Richards and seconded by G.A. Holmes to
select the three highest rating firms: RPM Company, The PAM
Companies, and Pacific West Management and invite them to
attend interviews on Wednesday, December 31, 1997
commencing at 9:00 a.m. J. Richards and G.A. Holmes and C.
Wick volunteered to be a part of the interview panel. Motion
carried.
CONTINUED ITEMS A. MOBILE HOME PARK ISSUES
1. PORTOLA PALMS MOBILE HOME PARK - UPDATE
Ballots were sent to the residents requesting they cast their
vote on whether or not the 37 spaces currently owned by
the Acquisition Association and secured by a note held by
the Redevelopment Agency should be transferred to the
Redevelopment Agency. There was a unanimous 100%vote
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Special Mtg. Minutes
Dec . 23 , • 1997 IO'LT$TNGr ApvxsoAckv cO MMT T'wgz
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CONTINUED ITEMS of support for the transfer of the property. Upon receipt of
(CONTD) all information requested from the Acquisition Association
by the Agency's attorney, the Grant Deed in Lieu of
Foreclosure will be placed into escrow to consummate the
transaction. We anticipate having possession of the lots by
the end of February. The lots will be reappraised and offered
to the existing tenants on a first right of refusal to purchase
basis.
2. SILVER SPUR MOBILE HOME PARK -
PROPOSED ORDINANCE
Staff has forwarded the Westminster Ordinance to the City
Attorney Dave Erwin for his review and opinion.
Clarification of liability to the City as well as his
recommendation will be provided to the Housing Advisory
Committee upon receipt.
B. HOME IMPROVEMENT PROGRAM
Charlene Sumpter, Rehabilitation Specialist is assisting eight applicants
who reside in Focus Area 1 with the application process. Contractors
have gone out to the homes and have provided Charlene with estimates
for the necessary work. Work will be documented through photographs
from beginning to end of construction/rehabilitation.
On December 11, 1997, the City Council authorized the recruitment of
one additional full-time staff person to assist with the implementation of
the Home Improvement Program. Staff will begin recruiting immediately.
C. HOUSING AUTHORITY NEGOTIATIONS
Outcome of negotiations will be submitted to City Council at closed
session on 1/8/97. It is anticipated that the agency will take possession of
the eight properties by the end of January.
D. SANTA ROSA APARTMENTS DISPOSITION - UPDATE
Request for bids was advertised for 3 weeks beginning on 10/16/97.
Closing date to submit bid proposals was originally set for October 31,
1997. Most interested contractors indicated that it was an extremely busy
time for them. Therefore, bid date was extended to November 21, 1997.
No bids were received. It is proposed that staff investigate the possibility
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• Special Mtg. Minutes
Dec. 23 , • 1997 H017' sNsa . PVIS " 'OM UTTEE,
•
CONTINUED ITEMS of letting the work via negotiated contracts with local general contractors
(CONTD) to determine if it is cost effective.
E. BUILDING HORIZONS PROPOSAL
Building Horizons has broken ground on the two homes. The
Affordable Housing Agreement was prepared and forwarded to Agency
legal counsel for their review and approval, after which it will be
scheduled for Agency review and action.
REPORTS A. DESERT ROSE UPDATE
146 units out of 161 units have been sold to date, 15 units left.
Sales have continued at an average of 7 sales per month with an expected
sell out by April 1998.
B. HOUSING PROJECTS UPDATE
Status report will be provided at the next Housing Advisory
Committee meeting.
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ADJOURNMENT Motion was made by J. Richards and seconded by G.A. Holmes to
adjourn the meeting. Meeting was adjourned at 4:20 p.m.
Carlos L. Ortega
Secretary
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PALM DESERT REDEVELOPMENT AGENCY
INTEROFFICE MEMORANDUM
DATE : October 9, 1997
TO : David Erwin, City Attorney
FROM: Teresa La Rocca, Housing Programs Coordi term
SUBJECT: Proposed Mobile Home Park Conversion C Wince
Attached is a copy of the City of Westminster's No. 2222 which was brought to our
attention by residents of the Silver Spur Mobile Home Park Association via Councilwoman
Jean Benson. The Housing Advisory Committee has requested staff take a look at the
ordinance for application to the City of Palm Desert Mobile Home parks and possible
adoption by City Council.
Please give me your thoughts on the attached as it obviously has implications to the City's
Planning Department and the City as a whole. There was concern expressed by the
Housing Advisory Committee with regard to legal liability on behalf of the City and validity
of this ordinance should it be adopted. Based on this, they asked that I forward a copy of
this ordinance to you for your review and input. I have also attached a copy of
Westminster's Ordinance No. 2227 and the City's Policies and Procedures regarding the
conversion of a mobile home park.
If you have any questions, feel free to give me a call. I hope to take your comments back
to the Housing Advisory Committee at their next meeting scheduled for November 12, 1997
at 3:30 p.m.
Thank you for your assistance.
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January 20, 1998
MEMORANDUM
TO: Teresa La Rocca, Housing Programs Coordinator
FROM: Helene P. Dreyer, Deputy City Attorney
RE: Request for review - Proposed Mobilehome Park Conversion
Ordinance
You have asked for our review and comment upon City of
Westminster Ordinance No. 2222 ("the Westminster Ordinance") which
was brought to the attention of the Housing Advisory Committee by
residents of the Silver Spur Mobile Home Park Association via
Councilwoman Jean Benson. You have also requested our
consideration of the probable effect if a similar ordinance were
adopted in the City of Palm Desert; and our review of the Palm
Desert Redevelopment Agency's current Policies and Procedures
regarding the conversion of mobile home parks.
Mobilehome conversion is an area of law that is highly
regulated by the State. In many respects, that regulation amounts
New to preemption. However, there is some latitude for local
regulation and, with respect to relocation impacts, local agency
review is mandated. Therefore, at a minimum, an enabling ordinance
needs to be adopted to provide a procedure for the required review.
In adopting such an ordinance, however, we cannot recommend
verbatim adoption of the Westminster Ordinance for the reasons
outlined below. However, the Westminster Ordinance can be used as
a "starting point" for developing a conversion ordinance for use in
the City of Palm Desert.
I. EXISTING LOCAL REGULATION.
The City of Palm Desert Municipal Code currently regulates
mobilehome parks via Chapter 9.50 [Mobile Home Park Rent Review]
and Chapter 25.22 [R-1-M Single-Family/Mobile Home Residential
District] . Except for. the limitations upon conversion to other
uses which zoning may present and/or limitations of rent control,
neither of these Chapters significantly impacts the actual
conversion process or scheme.1/
i/ In adopting a new ordinance, care must be taken not to use the
definitional scheme of Chapter 9.25 - which applies only to rent
control vis a vis the park owner as lessor and the owner of the
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You have also requested our "review of the current policies
... and procedures regarding conversion of mobilehome parks. " The only
such document you have submitted to us is the Redevelopment
Agency' s "Policies and Procedures Regarding the Conversion of
Mobile Home Parks to Resident Ownership" ("the RDA Policies" . )
The RDA Policies govern the provision of financial aid where
a conversion to resident ownership is sought. On the whole, the
policies are not objectionable.2/ They establish guidelines for
the conditions upon which financial aid might be granted and
further a stated goal to encourage conversion to resident ownership
in order to increase affordable housing.
In relation to the Westminster Ordinance and/or the issue of
ordinance adoption in the City of Palm Desert, however, it must be
noted that the RDA Policies apply only to conversion of mobilehome
parks to resident ownership and only to standards governing
financial aid. They do not set forth a process for conversion to
residential ownership and do not apply to conversion of parks to
any other use. Therefore, the RDA Policies would be largely
unaffected by the adoption of an ordinance similar to the
Westminster Ordinance unless specifically incorporated therein.
(If there are additional policies applying to such alternate
conversions, please submit them for review prior to adoption of any
ordinance. )
II. THE WESTMINSTER ORDINANCE.
The Westminster Ordinance is not directed at issues of zoning
or rent control. Rather, it concerns itself with the conversion of
existing mobilehome parks "to any other use of land. . . or a change
in the form of ownership of all or any portion" of the park.
(Westmin. 17.59.10 (H) [defining "Mobilehome Park Conversion"] . )
Essentially, it provides a scheme whereby notice must be given of
intent to convert, an impact report prepared, public hearing, and
relocation reimbursement imposed upon the "owner and/or applicant"
prior to approval of a conversion permit.
Our review of this ordinance has revealed several areas of
significant Concern and/or inconsistency.
mobilehome as lessee. Thus, for example, "tenant" is defined in
the rent control regulation as "an owner of a mobile home, " (P.D.
Munic. C. 9.50.20 (J) ) , whereas (as discussed below) a distinction
must be made in a conversion ordinance between "owners" and
"residents" of those mobi_lehomes.
a/ Please note that the final section of the RDA Policies contains
several type-o's which you may wish to correct when you have the
opportunity, particularly in the bolded paragraph beginning with
"It shall further be the policy. . . ", as well as subparagraph (3)
thereunder.
Now-
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A. SEVERAL DEFINITIONS ARE TOO BROAD OR AMBIGUOUS.
1. "Applicant" .
Section 17.59.010 (A) defines "Applicant" for a conversion
permit as any "person(s) , firm(s) , entity(ies) or corporation(s)
applying for a conversion permit for the purpose of converting,li
changing to another use, closing or ceasing to use land as a
mobilehome park. "
By this broad definition, any resident of a mobilehome park
could initiate a conversion application process and that process
could arguably be completed without any consent of the park owner.
(Note also the distinction later made that the "park owner and/or
applicant" is responsible for paying relocation costs (sec.
17.59.50) . )
This is admittedly an extreme example. However, consider that
a mobilehome park resident has submitted the Westminster Ordinance
in hopes of its adoption. Whether that resident' s motivation was
the desire to see a notice and relocation provision adopted, or the
mistaken belief that such an ordinance would enable residents to
force a conversion against the wishes of the park owner, is not
clear.
Furthermore, it is a problem easily avoidable by fine tuning
the definition of "applicant" in any statute adopted. A
Westminster Deputy City Attorney closely involved with the adoption
New of the Ordinance has indicated that this provision was worded
broadly with the intent of including prospective park
purchasers/developers in the group of those authorized to commence
a conversion application. Changing the wording used by Westminster
to "park owner, or any person with the written consent of the park
owner" would both alleviate our concerns and avoid misleading
residents, while also meeting the developer/purchaser objective.
2. "Comparable Mobilehome Park" .
Under the Westminster Ordinance, consideration must be given
to the existence and availability of "comparable mobilehome parks"
to which residents may be relocated and for which relocation an
"owner and/or applicant" may be held to pay relocation expenses.
However, "comparable mobilehome park" is defined (sec.
17.59.010 (C) ) with reference to parks "within a 50 mile radius" .
Given the geographic limitations of the Coachella Valley, this
distance is probably too large to be considered "comparable. "
3/ Pursuant to section 17.59.10 (H) , "conversion" includes, but is
not limited to, closing or changing the use or ownership of a park.
Now
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3. "Conversion Permit".
Section 17.59.010 (E) defines "conversion permit" as that
issued "to the park owner" authorizing "the park owner" to
discontinue the use, while subsection (A) [discussed above) permits
any "person(s) " to apply for the permit. If the intent is to
permit developers and/or purchasers to initiate a conversion
process, consideration should be given to whether final approval
may tentatively issue before that applicant is the actual "owner. "
Conversely, if the permit may only issue to the "owner, " then the
broad definition of subsection A (virtually "any person" can apply)
makes no sense.
4. "Nobilehome Owner"
"Non-resident Mobilehome Owner"
"Resident"
Here is where the definitional scheme of the Westminster
Ordinance really begins to fall apart.
"Mobile home owner" is defined as the registered owner of a
mobilehome (sec. 17.59.010 (G) ) , and "Non-resident Mobile Home
Owner" as an owner that does not reside in the park. (Sec.
17.59.010 (T) .)
However, the Ordinance also uses the terms "resident, "
"occupant" and "tenant" without defining or distinguishing those
terms, and no definitional provision has been made for "residents"
who are not "home owners. " Furthermore, the term "resident" is
not used in sections where logic dictates that "residents" should
have been included. The result of these inconsistencies may leave
"residents" who are not also "home owners" unprotected under the
Ordinance.
For example:
* Section 17.59.025 prohibits the sending of any notices or
correspondence to "residents" concerning conversion,
except as required by the Ordinance, but then the
Ordinance never "requires" any notices to "residents";
* Many of the notices required need only be given to "home
owners" but not likewise to "residents" - even though
conversion impact upon the residents is a vital issue to
be considered in impact reports and at public hearing
(sec. 17.59.025) ;
* The Conversion Impact Report must contain "Occupant"
information; the names/addresses of persons "owning or
occupying"; the total number of "residents"; whether the
"residents" are "owners" or "tenants"; and the length of
occupancy of the "current occupant" (sec. 17.59.030
(C) (1) , (2) ) ;
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* If the "residents" fail to cooperate in providing the
information required for the Impact Report, the City may
waive the requirement. No similar exemption is provided
for lack of cooperation from "home owners" , "occupants",
"tenants" or "current occupants", as distinguished from
"residents" . (Sec. 17. 59.030 (C) (2) ) ;
* The Impact Report must also include a relocation
compensation plan, including plans to accommodate the
"home owners" of unrelocatable homes and the specific
benefits and options available to "home owners", but
apparently not similar information as to the impact on
"residents" or "occupants" . (Sec. 17.59 .030 (C) (4) ;
* The applicant or park owner is required to mitigate the
effects of the conversion on "displaced home owners" by
providing relocation compensation (sec. 17.59.050 . )
These include not only the expense of relocating the
actual home, but also the cost of moving personal
belongings and a daily living allowance. (Sec.
17.59.050 (D) , (E) . )
However, expenses for moving personal belongings are
limited to the personal effects of the "home owner" , not
the "resident" . Furthermore, the daily living allowance
is calculated via consideration of the number of
`- "residents" or "persons residing" in the home, but
additional funds are provided for each person
"permanently residing" in the home; the allowances apply
only for each day "a home owner and cohabitants" are
without a home; and it the "home owner, " not the
"resident, " who is designated to actually receive the
daily living allowance and/or apply for an additional
allowance. (Id. )
Having thus so limited relocation compensation
entitlement to "home owners, " subsection 17. 59. 050 (I)
then provides that a "non-resident homeowner" is not
eligible for any relocation compensation other than for
moving the actual home;
* Only "home owners" are entitled to receive a rent
differential on the basis of age or low income
(subsection (H) ) ; and
* Any notice to a "mobile home owner or resident" required
by the Ordinance is considered given so long as it is
provided to "one such owner" in the case of multiple
"owners. " It ignores "multiple residents" and implies
that one notice to one "home owner" is sufficient
regardless of the existence or number of "residents" .
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Likewise, any compensation expense payable to a "mobile
mew home owner" is deemed paid to all such "owners" when
given in full to one "owner. " (Sec. 17.59. 010 (G) . )
Though not fatal, in many instances this lack of clarity
leaves the Ordinance difficult to understand and implement
correctly. By separately defining "non-resident home owner", the
term "home owner" is probably intended to be limited to "resident
homeowners. "il However, even that distinction becomes clouded
when considering who is a "registered owner" ; who is an "occupant"
vs. a "resident"; whether a "resident, " "occupant" or "homeowner"
is also a "permanent resident"; and what to do with "residents" who
are not also "home owners", regardless whether those "residents"
are thereby "tenants" or mere "occupants. " There is also the use
of the phrase "mobile home owners residing in their parks" in the
section on notification of rights (sec. 17.59.090) , which negates
an interpretation that "mobile home owner" automatically means
"resident mobile home owner. o5/
In adopting any ordinance for the City of Palm Desert, careful
consideration must be given to developing clear definitions and an
unambiguous description of the rights to notice and reimbursement
of all such persons.
B. THE ORDINANCE IMPERMISSIBLY RESTRICTS FREEDOM OF SPEECH.
Section 17.59.025 provides:
vow "With the exception of the notices required by this
ordinance and correspondence directly related to the
preparation of the Conversion Impact Report (CIR) , the
applicant shall not issue any arbitrary notices or letter
to the residents concerning the intention to convert or
close the Park. Such actions shall be considered
arbitrary if no application for conversion is filed with
the City within 30 calendar days thereafter. In the case
of such arbitrary action, the City shall notify the
applicant that a fine of $200 per day shall be
imposed. . . . "
J See also City of Westminster Ordinance 2227
[establishing
Mobilehome Commission] which defines, for that purpose, "mobile
home tenant", "tenant" and "resident" to mean "any person entitled
to occupy a mobile home dwelling unit pursuant to ownership thereof
or a rental or lease agreement with the owner thereof. (Sec.
2.61. 010C )) .
V See, e.g. , Civil Code sec. 798.11 [mobilehome residency law]
defining "homeowner" as "person who has a tenancy in a mobilehome
park" ; and "resident" as "homeowner or other person who lawfully
occupies a mobilehome. "
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As noted, above, "applicant" means "person(s) , firm(s) ,
•... entity(ies) or corporation(s) applying for a conversion permit. "
(Sec. 17.59.010 (A) . ) All "applicants" are prohibited from issuing
any "notice or letter" that is "concerning the intention to convert
or close the Park" unless they also actually file an application
for conversion within 30 days. Violation results in the imposition
of a daily fine of $200 per day. This is clearly an impermissible
prior restraint upon the freedom of speech and would not survive a
Constitutional challenge.
Additionally, imposing such a restraint is unreasonably
impractical. The restraint essentially means that a developer
cannot investigate the willingness of park residents to permit
conversion without objection; strips any applicant of the
opportunity to investigate and attempt to address objections in
advance of application; prohibits homeowner associations from
canvassing the residents with respect to proposals for a buyout of
the park owner and conversion to residential ownership; restricts
the applicant's ability to obtain an informed estimate of the
ultimate cost of conversion before beginning the application
process; and essentially prohibits any advocation for or against
conversion unless and until the filing of an application will be
made within 30 days or never made. Thus, even if not
Constitutionally invalid, the restriction impedes efforts to effect
park conversion - including conversion to residential ownership -
and could result in needless initiations of the permitting process
(and waste of City resources) by persons undecided as to
conversion, but trying to avoid the running of the 30 days.
When questioned regarding this "no speech" provision, the
Deputy City Attorney for the City of. Westminster indicated that the
provision was included to make clear exactly when the conversion
application process began and to avoid creating the impression
among residents that an application had been submitted.
Apparently, there had been many "false alarms" in the community.
However admirable Westminster' s goals, we do not believe their
solution withstands Constitutional scrutiny. Nor would altering
the provision to require that any communications indicate whether
an application has been filed likely be permissible. Instead, of
either option, we recommend establishment of a clearly defined
commencement indicator, such as the filing of a particular form.
In that way, both the public and staff may readily ascertain
whether an application has been commenced without impermissibly
restraining the free speech rights of park owners or others who may
wish to communicate with residents on the topic of conversion.
While that may result in a few "false alarm" calls to City Hall,
that is far less problematic than a constitutional challenge. (Nor
is the problem likely to be as widespread as that encountered in
Westminster, where mobilehotne parks are apparently far more
prevalent. )
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C. THE ORDINANCE LEAVES MATERIAL ISSUES UNADDRESSED.
In addition to the definition/terminology inadequacies, the
Westminster Ordinance does not specifically address issues and/or
is otherwise problematic in the following respects:
* Does not address situation where all existing fixed-term
leases have expired and the applicant is seeking to
convert an unoccupied mobilehome park;
* Does not address the confidentiality and/or public
records accessibility of resident name/address
information. (See, e.g. , Govt. C. sec. 7060.4
[notification to public entity of intent to withdraw
accommodations subject to rent control, information
respecting tenant names/addresses to remain
confidential] ) ;
* The relocation compensation does not include
consideration of the value of loss of the leasehold (if
you prefer to include it) ;
* Where a home is determined to be "unmovable, " the
applicant and/or park owner is required to compensate the
home owner for the "appraised value" of the home.
However, to the extent the Ordinance empowers the park
owner to compel a premature end to the tenancy of a
homeowner/resident with an unexpired, fixed-term lease,
the city may be at risk of suit based upon allegations of
actual or inverse condemnation.
* The "daily living allowance" rates and the schedule for
advance payment of expenses may be unreasonable.
* The Ordinance requires park owners to give notice to all
"mobile home owners residing" in Lhe park - yet another
use of undefined terminology that appears to conflict
with, or mean something different than, "resident",
"tenant", "homeowner, " etc.
III. EXISTING STATE LAW REGULATION OF MOBII,EHOME PARK CONVERSION.
Under the Westminster Ordinance, a "conversion permit" must be
obtained for any change of use or change in form of ownership for
a mobilehome park - in addition to any other required "change of
use" permits. (Sec. 17.59.020. ) The "change of use" includes
conversion to vacant land (non-use) and conversion to commercial
(non-residential) use.
The Westminster Ordinance is probably valid to the extent it
imposes a permitting requirement and imposes an obligation for
payment of relocation compensation regardless of the financial
circumstances of the persons being relocated (sec. 17.59.050) .
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However, its imposition of a one year waiting period (sec.
17.59.045 (6) ) following a denied application probably violated the
Ellis Act (discussed below. )
A. THE ELLIS ACT.
Ordinarily, an owner of residential real property has a near
absolute right to "go out of business" - that is, to discontinue
offering the property for residential tenancy - free from local
regulation designed to prohibit or restrict that right. (Govt. C.
sec. 7060 et. seq. "Ellis Act" . )
The Ellis Act is preemptive in nature and was intended to
address "the plight of the landlord. " (Civil C. sec. 7060; Los
Angeles Lincoln Place Investors, Ltd, v. City of Los Angeles (1997)
54 Cal.App.4th 53, 61 [legislative history of Act demonstrates
purpose to allow landlords to go out of residential rental business
by evicting tenants and withdrawing all units from market] . )
This right to "go out of business" applies even with respect
to rent controlled units, most residential hotels, rental of
historic landmarks, and local regulation designed to maintain
affordable and/or available housing levels. (See, e.q. , First
Pryteri.an Church of Berkeley v. City of Berkeley 1997 WL 763210
(Ca1 .App. 1 Dist December. 1997) ; Los An eles Lincoln Place
Investors, Ltd. v. City of Los Angeles (1997) 54 Cal.App.4th 53;
Bullock v. City and County of San Francisco (1990) 221 Cal.App.3d
1072; Channing Properties V. City of Berkeley (1992) 11 Cal.App.4th
88; Javidzad v. City of Santa Monica (1988) 204 Cal.App. 3d 524; and
Cit of Santa Monica v. Yarmark (1988) 203 Cal.App.3d 153 . )
However, the Ellis Act expressly states that it is not the
intent of the legislature to "alter in any way either (Govt. C. )
section 65863 .7 (Planning and Zoning] relating to the withdrawal of
//accommodations which comprise a mobilehome park from rent or lease
or [Civil Code sec. 798 .56 (g) ] relating to a change of use of a
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mobilehome park. "W [These statutes are together herein referred
to as the "mobilehome conversion statutes" .]
The mobilehome conversion statutes, especially Civil C. sec.
798.56, are intended to protect mobilehome tenants from arbitrary
eviction in recognition of the extreme cost and low practicality of
relocating mobilehomes. Thus, while the Ellis Act is directed
toward the plight of the landlord, the mobilehome conversion
statutes focus upon the plight of the tenant. (See, Keh v. Walters
(1997) 55 Cal.App.4th 1522, 1534. )
D. MOBXLEHOM$ CONVERSION
[Govt. C. sec. 65863.7, 65863.8]
Section 65863 .7 is applicable to charter cities (sub. (h) ) and
mandates that:
" (a) . . . prior to closure of a mobilehome park or
cessation of use of the land as a mobilehome park, the
person or entity proposing the change in use shall file
a report on the impact of the conversion. . , upon the
displaced residents of the [park] . . . the report shall
address the availability of adequate replacement housing
in mobilehome parks and relocation costs. "
" (e) The legislative body, or its delegated advisory
agency, shall review the report, prior to any change of
"wow use, and may require, as a condition of the change, the
person or entity to take steps to mitigate any adverse
impact of the conversion. . . on the ability of displaced
mobilehome park residents to find adequate housing in a
mobilehome park. The steps required to be taken to
mitigate shall not exceed the reasonable costs of
relocation. " [Emphasis added.]
6/ Likewise, though preemptive to the extent it confers a right to
go out of business, the Ellis Act leaves some leeway for local
regulation: If property is subject to rent control, a public
entity may provide by ordinance (or by resolution subject to voter
referendum) that withdrawn accommodations later again offered for
accommodation shall be subject to rates and controls as if never
withdrawn and, if again offered within one year, subject to
additional tenant compensation and/or punitive damages. (Civil
Code sec. 7060.2) ; if property subject to rent control, public
entity may require by ordinance (or by resolution subject to voter
referendum) that the owner notify the entity of intention to
withdraw accommodations (or intention to again offer) from rent or
lease and may require that notice contain statements under penalty
of perjury providing information on number, and names/addresses of
persons being displaced and applicable level of rent. (Civil Code
sec. 7060 .4. )
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A public hearing concerning the impact report must be held if
requested by either the applicant or a tenant or homeowner. (Sec.
65863.7 (d) . )
The local agency must provide the applicant, in writing,
notice of the provisions of Civil Code sec. 798. 56 and any local
regulation affecting notices that must be given by the applicant to
tenants and mobilehome owners. A hearing on the impact report may
not be held until the applicant has submitted verification (in a
form specified by the local agency) that the residents and
mobilehome owners have been notified as required by law. (Sec.
65863.8.)
C. MOBILEROME RESIDENCY LAW
[Civil C. sec. 798.56]
Civil Code sec. 798.56 (g) is a portion of the Mobilehome
Residency Law and addresses change of use or discontinuance of a
mobilehome park via termination of tenancy. The Mobilehome
Residency Law is preemptive and also applies to long term leases,
which are exempt from local rent control regulation. (Civil C.
sec. 798.17(b) ; Lake Cadena v. City of Colton (1998) 98 Daily
Journal D.A.R. 472, 473 . )
Some portions of the Mobilehome Residency Law apply only to
longterm leases. (See, e.g. , sec. 798. 17 (b) ["rental agreements
subject to this section . . . (1) shall be in excess of 12 months'
duration. . . . "] . ) However, section 798.56 appears to apply to all
Now types of "tenancies" in a mobilehome park, defined as "the right of
a homeowner to the use of a site within the park. . . . " (Sec.
798.12. )
Section 798.56 (g) provides that a park owner may terminate or
refuse to renew tenancy based upon planned change of use provided,
inter alia, that :
1. Homeowners are given at least 15 days notice of
public hearing requesting permits for change of use and
provided a copy of the report required by Govt. C. sec.
65863.7 [relocation impact report] ;
2 . Homeowners are provided 6 months notice of
termination of tenancy after all required permits are obtained
for change of use; or 12 months notice if no local change of
use regulation applicable;
3 . Notice of the proposed change (or of plans to apply
for a change) are provided to proposed homeowners.
In Keh v. Walters (1997) 55 Cal.App.4th 1522, 1535, the court
held that Civil Code eec. 798.56 and Government Code sections
65863 .7 and 65863 .8 "were clearly intended to function together as
an integrated scheme . " Furthermore, the requirements of sec.
65863.7 "were not made dependent upon the enactment of a local
`ter.
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ordinance and are not excused by the fact that the local ordinance
did not describe a particular filing and review process. . . . "
Regardless of the existence of an enabling ordinance, the person or
entity proposing the change cannot proceed until the local agency
has reviewed the impact report. (Id. at 1538.)
D. ABSENT FURTHER LEGISLATION OR COURT DECISION, THE
RESTRICTIVE MOBILEHOME CONVERSION STATUTES PREVAIL OVER
THE ELLIS ACT.
In Yee v. Escondido (1992) 503 U.S. 519, 112 S.Ct. 1522, 1528
- 1529, the U.S. Supreme Court held that the 1992 version of
California' s various statutes governing mobilehome park rent
increase and removal restrictions did not constitute a physical
taking because "the decision to use property as mobilehome park in
first instance was voluntary. " Commentators have maligned this
conclusion, as well as California' s regulatory scheme, stating, for
example, that:
"changes in [mobilehome park] land use just don't happen
in California. An elaborate zoning and regulatory
process must be negotiated. . . [and] in effect, the
[Mobilehome Residency Law] and rent control laws do not
'require' landowners to keep their land in the same use.
They 'only' say that you must pay a prohibitive tariff to
shift land use. " (R. Epstein, Yee v. City of Escondido:
The Supreme Court Strikes Out Again (1992) 26
Loy.L.A.L.Rev. 3, 18. )
In Channing Properties v. City of Berkeley (1988) 11
Cal.App.4th 88, 100, the court determined that requiring a
landowner to pay relocation expenses for all displaced residential
property tenants (in this case, $148, 500 for 33 units) regardless
of the tenants' income status violated the Ellis Act by imposing "a
prohibitive price on the exercise of the right under the Act. "
The mobilehome conversion statutes likewise pose a high risk of
imposing a "prohibitive tariff" upon discontinuance as a mobilehome
park.
However, Charming did not involve a mobilehome park and few
cases have expressly addressed the interplay between the Ellis Act
(which is intended to favor the landlord) and the Mobilehome
Residency Law (Civil C. sec. 798.56) and mobilehome park
conversion/zoning regulations (Govt. C. 65863 .7) , intended to favor
tenants and to consider the high cost of relocating mobilehomes.
According to Witkin:
"Unless there is an express provision to the contrary, it
must be conclusively presumed that the statute which is
enacted last or has the highest chapter number prevails
over a conflicting statute that was adopted earlier or
has a lower chapter number. (Govt. C. sec. 9605; see In
re Thierry S. (1977) 19 Ca1.3d 727, 745, fn. 17 [highest
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chapter number rule manifests Legislature' s intent and
.... must be followed] . ) Witkin, Summary of Calif. Law,
Constitutional Law sec. 94 (c) ( ed. 199 . )
In this instance, the Ellis Act was enacted in 1985 via Senate
Bill 505, Chapter 1509. The language in Govt. C. sec. 65863 .7
making it applicable to "closure of a mobilehome park or cessation
of use of the land as a mobilehome park" was also enacted in 1985,
but via Senate Bill 316, Chapter 1260.
Thus, by virtue of the highest chapter number rule, ordinarily
the Ellis Act would prevail over the mobilehome conversion
statutes. However, as noted above, sec. 7060.7 (5) of the Ellis Act
expressly provides that it is not intended "to alter in any way"
either Govt. C. sec. 65863 .7 or Civil C. sec. 798.56 as they
pertain to withdraw of mobilehome park accommodations and changes
of use. Therefore, it cannot be "conclusively presumed" that the
Ellis Act prevails over the conversion statutes.
In June 1997, a California appellate court finally addressed
(albeit briefly) the interplay between the Ellis Act and the
mobilehome conversion statutes, concluding that the Ellis Act is
not controlling based upon section 7060.7. (Keh v. Walters (1997)
55 Cal.App.4th 1522, 1533. In so doing, the court stated:
"We agree with respondent that a park owner is entitled
to convert property used as a mobilehome park to another
use, or even to hold it as vacant land. And we are not
unsympathetic to the plight of the mobilehome park owner,
whose property rights are impacted by the various laws
and regulations affecting mobilehome parks. Regardless
of our views, however, our task as an intermediate court
of appeal is limited to interpreting and applying
existing law. " (Id. at 1533 . )
In sum, therefore, the Ellis Act does not invalidate the
(sometimes onerous) requirements of the mobilehome conversion
statutes. However, that does not mean that the Ellis Act is wholly
inapplicable. The one year waiting period imposed by the
Westminster Ordinance upon denial of an application, for example,
is probably still an impermissible prohibition/regulation by virtue
of the Ellis Act.
IV. CONSIDERATION OF THE WESTMINSTER ORDINANCE IN LIGHT OF
EXISTING STATE LAW.
A. THE WORDING OF THE ORDINANCE RESPECTING PAYMENT OF
RELOCATION EXPENSES SOMEWHAT IMPLIES AN AUTOMATIC
OBLIGATION TO PAY.
The Westminster Ordinance does properly state that ;
"The Planning Commission shall require (as a condition of
approval of the proposed conversion) that the park owner
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and/or applicant shall take all reasonable measures to
Now mitigate the adverse effects created by the change in
use. These measures shall be based on the ability of the
displaced home owners to find adequate replacement space
in another Comparable mobile home park. [P] The
mitigation measures shall be limited to the payment of
relocation compensation as established herein. . . . " (Sec.
17.59.50. )
This language tracks the requirements of Govt. C. sec. 65863 . 7
and, upon careful reading, is probably adequate. Nevertheless, it
is our opinion that the Ordinance lacks clarity in that, due to its
length and the overwhelming procedural detail contained in therein,
if a similar ordinance is adopted then Lhis section should be
amended to add an unequivocal statement making clear that
entitlement to reimbursement compensation is not automatic and that
the reason for the public hearing will be for the review of the
impact statement and the determination of precisely who will be
entitled to what amount.
B. DOES THE CITY OF PALM DESERT "NEED' A MOBIXiEHO>MIE
CONVERSION ORDINANCE?
Yes. The City must enact an enabling ordinance to carry out
the requirements of Govt. C. section 65863 .7 and 65863 .8 (review of
relocation impact report) .
The City may also wish to include a requirement for obtaining
a "conversion permit" (similar to the Westminster approach) . if
the park owner/developer does not need to obtain any "local
governmental permits" for a change of use of the park, then Civil
C. sec. 798.56 requires that the converting party provide
tenant/residents 12 months notice in advance of the conversion. If
local government permits are required, the notice period is
shortened to 6 months but begins to run after all required permits
have been approved. Without a conversion permitting requirement,
some conversions may not require an additional permit under current
City ordinances. (Discontinuance of the park for mobilehome
residency and reversion to vacant land, for example. )
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PALM DESERT REDEVELOPMENT AGENCY
INTEROFFICE MEMORANDUM
DATE: February 2, 1998
TO: CARLOS ORTEGA, Executive Director RDA
FROM: TERESA L. LA ROCCA, Housing Programs Coordi r .tor-
SUBJECT: DESERT ROSE UPDATE - As of January 15, 199: ____--
Sales: 151 units (Phase 1, 2 and 3)
Average to date subsidies (exclusive of sales price reduction)
Average mortgage subsidy $11,600
Average closing costs $ 2,315
Average interest buy down $ 2,985
w Escrows: 131 Closed
20 Open Escrows
Hw Income Breakdown: 13 Family of very low income
91 Families of low income
47 Families of moderate income
1'14 Phase I: 3 Units available
w Phase II: 3 Units available
'is Phase III: 4 Units available
• Average Sales Rate: 7 sales per month
» Summary of the Media Campaign:
Current media campaign is underway. Trafficnumbers continue, but many visitors do
not qualify. Offering additional financial assistance to large families of very low income
as a special incentive to buy.