BILL ANALYSIS
AB 1542
Page 1
Date of Hearing: April 25, 2007
ASSEMBLY COMMITTEE ON LOCAL GOVERNMENT
Anna Marie Caballero, Chair
AB 1542 (Evans) - As Introduced: February 23, 2007
SUBJECT : Mobilehome parks: conversions.
SUMMARY : Repeals provisions of the Subdivision Map Act that
exempt the conversion of rental mobilehome parks to resident
ownership from local government approval and conditions.
Specifically, this bill :
1)Repeals the provision of the Subdivision Map Act (Map Act)
that exempts the conversion of rental mobilehome parks to
resident ownership from local government approval and
conditions.
2)Repeals the provisions of the Map Act that provide procedures
for subdividers to address the economic displacement of
nonpurchasing residents of a mobilehome park that is being
converted to resident ownership.
EXISTING LAW :
1)Allows the local legislative body authorized to approve or
disapprove a tentative or parcel map for the conversion of a
rental mobilehome park to another use to require the
subdivider to take steps to mitigate any adverse impact on the
ability of displaced mobilehome park residents from finding
adequate space in a mobilehome park, but exempts the
conversion of rental mobilehome parks to resident ownership
from this provision.
2)Requires, in lieu of local government approval and conditions,
that a subdivider offer residents of a mobilehome park that is
converted to ownership the option to purchase their
subdivided unit or to continue residency in the park if they
decide not to purchase their lot.
3)Requires the subdivider to file a report on the impact of the
conversion upon residents of the park and to make the report
available to all residents 15 days prior to the hearing on the
tentative or parcel map before the local legislative body.
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4)Requires the subdivider to conduct a survey of support of the
residents of the park for the proposed conversion.
5)Limits the scope of the hearing of the legislative body on the
tentative or parcel map to the subdivider's compliance with
the procedures to avoid the economic displacement of
non-purchasing residents.
6)Establishes the following method for avoiding the economic
displacement of non-purchasing residents:
a) Allows the monthly rent for non-purchasing residents who
are not low-income to increase from the preconversion rent
to market rents as defined in an appraisal conducted in
accordance with nationally recognized professional
appraisal standards in equal annual increases over four
years;
b) Allows the monthly rent for non-purchasing, low-income
residents to increase from the preconversion rent by an
amount equal to the average monthly increase in rent in the
four years immediately preceding the conversion except that
in no event may the monthly rent be increased by an amount
greater than the average monthly percentage increase in the
Consumer Price Index for the most recently reported period.
FISCAL EFFECT : Unknown
COMMENTS :
1)There are approximately 4,800 mobilehome parks and
manufactured communities in California with an estimated
700,000 residents. In the majority of parks, residents own
their homes but rent the land on which their homes are
installed from the park on a month-to-month or long-term lease
agreement. According to a recent background paper published
by the Senate Select Committee on Mobile and Manufactured
Homes (Select Committee), most of the parks in the state are
privately owned by investor groups or owner/operators, and an
estimated 150 are owned by resident organizations or
non-profit organizations.
2)According to the Select Committee, in the mid-1980s, as a
result of increasing park rents for low- and moderate-income
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residents and the closure of some parks and displacement of
residents, the concept of resident-owned parks (ROP), in which
residents form a homeowners association to purchase a park for
sale and convert it to a mobilehome subdivision, condominium,
stock co-operative, or non-profit ownership, gained
popularity. As a result of this shift between 1984 and 1996,
a number of laws were enacted to encourage ROP conversions.
3)Conversions of mobilehome parks to other uses are considered
to be a subdivision pursuant to the Map Act. Prior to 1991,
the Map Act required a subdivision map to be filed and
approved by the local jurisdiction before individual lots in a
park could be sold and converted to a resident-owned
subdivision or condominium, and allowed the local government
to impose its own conditions on the map, such as steps to
mitigate economic displacement of non-purchasing residents or
inclusion of a method to ensure that a majority of residents
supported the conversion. In 1991 the Legislature exempted
ROP conversions from Map Act requirements when two-thirds of
the owners approved the conversion, Then in 1995, in response
to further complaints from some resident groups and conversion
consultants, the Legislature restricted the power of local
governments to regulate the conversion of parks to
resident-owned condominiums or subdivisions with the enactment
of Government Code Section 66427.5, which provided a minimum
state standard for mitigation of non-purchasing residents
through a "state-rent control formula" for low-income
residents who did not purchase their lots.
4)The creation of a state rent control formula preempted local
rent control ordinances, raising concerns among local
jurisdictions who had no means of enforcing the state rent
control. Additionally, moderate-income residents who do not
purchase their mobilehome have their lot rents increase to
market rate in four years, which has led to concerns about the
loss of affordable housing.
5)In response to an appellate court decision (El Dorado Palm
Springs, Ltd. v. City of Palm Springs et al.), the Legislature
passed AB 930 (Keeley) Chapter 1143, Statutes of 2002, to
allow local governments to require park owners as part of the
Subdivision Map Act process to provide the city with a survey
of support indicating resident support for a proposed ROP
conversion, and included un-codified language stating the bill
was intended to assure such conversions were "bona-fide."
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6)According to the Select Committee, within the last year and a
half a number of mobilehome parks have either notified their
residents of the park's intention to convert or have actually
applied to local governments for a map to convert their rental
parks to a park condominium. Media reports indicated there may
be between 12 and 30 park-owner initiated ROP conversions
taking place in, among other locations, Buellton, Carson,
Ojai, Vallejo, Santa Rosa, Healdsburg, Rohnert Park, and
unincorporated areas of Sonoma and San Luis Obispo Counties.
7)At a recent hearing of the Select Committee, representatives
of local governments expressed concern that the existing
process for converting mobilehome parks to resident ownership
does not give them the authority to enforce rent control
protections and reduces their affordable housing supply.
Cities and counties are required to maintain and produce a
specified amount of affordable housing each year, and the
conversion of rental mobilehome parks to resident ownership,
which allows mobilehomes that are not purchased by the
resident to go to market rate after four years, reduces the
supply of affordable housing in the community.
8)Under existing law, a local governing body has the authority
to approve a tentative subdivision map for a mobilehome park
conversion to other uses and to impose conditions on that
approval to mitigate the impact of the conversion on
residents' ability to find adequate housing in other
mobilehome parks. The standard is a minimum and does not
prohibit the local legislative body from enacting more
stringent provisions. However, the law specifically exempts
ROP conversions from local control. AB 1542 removes this
exemption.
9)The Committee may wish to consider two basic questions
concerning AB 1542:
a) Is it appropriate that the state should substitute its
judgment for that of a local government for this one narrow
category of land use decision, particularly if doing so
makes it harder for local governments to satisfy other
state-imposed requirements for the provision of affordable
housing?
b) Given that conversion of mobilehome parks to resident
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ownership may provide lower- income households with unique
opportunities to achieve true, equity-building home
ownership, should local governments be allowed to place
additional hurdles in the way of such conversions? Does AB
1542 provide protections to one class of lower-income
household at the expense of another?
10)This bill was heard by the Assembly Housing and Community
Development Committee on April 11, 2007, where it passed with
a 5-2 vote.
REGISTERED SUPPORT / OPPOSITION :
Support
City of Santa Rosa [CO-SPONSOR]
County of Sonoma [CO-SPONSOR]
American Planning Association, CA Chapter
CA Alliance for Retired Americans
CA Rural Legal Assistance Foundation
CA State Association of Counties
Cities of Carson and Santa Rosa
County of Ventura
El Sereno Estates
Golden State Manufactured-Home Owners League
Mayors and Councilmembers Association of Sonoma County
Western Center on Law and Poverty
Individual letters (90)
Petition signatories (580)
Opposition
Californians for Resident Ownership
CA Mobilehome Parkowners Alliance
Western Manufactured Communities Housing Association
Individual letter (1)
Analysis Prepared by : J. Stacey Sullivan / L. GOV. / (916)
319-3958