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Item 5 - Ballot Initiative on Mobilehome Rent Control Restrictions /~ ENDA REPORT SUMMAR'- ~ TO: Honorable Mayor and Members of the City Council FROM: James L. Bowersox, City Manager INITIATED BY: John D..Fitch, Assistant City Manager's, ~. Penny R~ley, Senior Management AnalysF,.j~ DATE: May 16, 1995 SUBJECT: Ballot Initiative on Mobilehome Rent Control Restrictions On May 9, 1995, Councilmember Bob Emery requested that staff obtain information on the Mobilehome Rent Control Restrictions Act. This report provides a summary of the measure and requests Council direction for further action. This item is not subject to CEQA review. F There is no fiscal impact associated with this informational report. None. t is recommended that the City Council provide direction to staff. ACTION Continued to 5-18-95. (7/~ (~ /~c~ ~ Marl puty ( y, \repot ~ 1~AY181995 rrEM .5 ..~ i of 12 MAY 1 6 I§§B ITEM 14 ,, ) CITY OF Pow^Y AGENDA REPORT TO: Honorable Mayor and Members of the City Council FROM: James L. Bowersox, City Manager INITIATED BY: John D. Fitch, Assistant City Manager~~ Penny Riley, Senior Management Analys~)~'' DATE: May 16, lgg5 SUBJECT: Ballot Initiative on Mobilehome Rent Control Restrictions On May 9, 1995, Councilmember Bob Emery requested that staff obtain information on the Mobilehome Rent Control Restrictions Act. FINDINGS Provided in Attachment A for City Council's consideration is the Attorney General's title and summary of the ballot initiative: Nobilehome Rent Assistance. Nobilehome Rent Control Restrictions. The text of the measure is included as Attachment B. The initiative generally contains the following p · Requires mobilehome park management to administer and provide rent subsidy equal to ten percent discount on monthly rent to tenants meeting residency and income requirements when ten percent or less of occupied spaces are covered by rent control or rent subsidy. · Establishes priorities for, and conditions for losing, rent subsidy. · Invalidates existing, and prohibits new, state mobilehome rent control laws. · Limits existing, and prohibits new, local mobilehome rent control laws. · Prohibits such laws from requiring reductions in rent and limiting ' in rent to less than specified cost of living index. The ballot initiati e received a sufficient number of verified signatures to qualify for the bal ct on October 12, 1994. The Nobilehome Rent Assistance. Hobilehome Rent Con rol Restrictions measure will appear on the ballot for the statewide election o be held March 26, 1996. IiAY 1 8 1995 ~[~M ,5 ~.:t'l 2 of 12 )lAY 16 1995 I'rEM 1~+ ~ Agenda Report - Rent Control May 16, 1995 Page 2 PACT There is no fiscal impact ~ with this inf 1 report. EVIEW This item is not subject to CEQA review. None. RECOMMENDATION It is recommended that the City Council provide direction to staff. JLB:JDF:PAR:eb Attachments: A. Attorney General's title and summary of ballot initiative: Mobilehome Rent Assistance. Mobilehome Rent Control Restrictions B. Ballot initiative text. I~AY 1 8 1995 ITEM blAY ). 6 1995 iTEM 1~+ 3 of 12 Date: January 27, 1994 File No: SP..93RF0042 The Attorney General of Callforrda has prepared the following title and summary of the chief purpose and points of the proposed measnre: MOBILEHON[E RENT ASSISTANCE. MOBrLEHO,ME REN"I' CONTROL RESTRICTIONS. INITIATIVE STATUTE. Requires mobilchomc park to and pro, de rent subsidy equal 1o ten percent discount or. mr~nth!., tc~;t to tenants meeting residency and income req when ten percent or less of occupied spaces are covered by rent control or rent subsidy. Establlshcr priorities for. and ' ' ' for losing, rent subsidy. Invalidates existing, and proh/bits new, state mob/dehome rent control laws. 15mits exSsting, and prohibits new, local mobilehome rent control laws. ?rol-zibits such laws from requiring reductions in rent and limiting increases in rent to less than specified cost of lMng index. Summary of estimate by Legsslative Analyst and Director of Finance of fiscal impact on state and local g No impact on state costs or revenues, l.n the near Term. cities and counties may increased costs which are unknown, but are not likely to lotal more than millions of dollars annually. In the long term, local agencies wonld savings in the range of millions to tens of millions of dollars annually. I~iAY 1 8 1995 4 of 12 Attachment A ~IAY 1 0 1995 AN BE THE ¥0 ~ I.~S The Attorney General of California has prepared the following title and e, um .mary of the cfaief purpose and points of the proposed measure: (Here set forth the title and summery prepared by the Attorney Ger,e~al This title and summary must also be printed top of each page of the ped~Jon whereon are To the Honorable State of California: We, the undersigned, registered, qualified voters of California, ~esident~ of County (or City end County), hereby propose to [he California Civil Code, releting to establishment of a subsidy for Clualified Dr, or and needy on park rent control in lieu thereof, and prohibitions of of rent control measures by the State anc by ,oca; charter and genera; ;aw c!ties and counties, and petit,on the Secre;ary State to submit the same to the voters of California for their adoption or rejection at the next ;~ general election. The proposed statutory (tull tide ~nd text of the measure[ read as follows: ._ SECTION 1: TITLE This Measure shall be cited as The Fairnes~ and Rental SECTION 2: FINDINGS AND DECLARATIONS OF PURPOSE (a) The People of the State of California find and declare as follows: (1) Soma tenants of parks ir'~ L;a~if..~rrda are poor end needy and are urgently in need of without dele'~s, expense or reel tape which state and usuaIfy requires for the 01 rental programs; and (2) Over 80 local are spending millions of dollars annually ad ' ' and enforcing mobilehome park rent controls for the exclusive benefit of owners of mobilehomes which comprise only 5-percent of Cahfarnia'~ housinG units with ::1 controls that are generally not means tested to the poor, so that mobitehome owners ' 2e value ot ~50,OOO obtain unfair price controls in of small b and all the citizens of California: and (3) These controls jeopardize of park housing for al! and jeopardize cont!nueCJ an~- seal! existence in California; and (4) Reouiring the provis;on of direct rental subsid~e~ Dy requiring park owners to provide specified reduce~ rer,~s for the p,3or, togettmr w~tn the on most restrictive features of rent limitations wf~icb have~4Ayadversely[ 8 1995a;~e~a 5 of 1Z Attachment B ~IAY 1 6 1995 ITEM the and supply of mobile home housing. *s the continued of affordable mob;ia home housing to the poor; and (5) The limitation of the rental subsidy provided in ~hi.~ f~':eaSL.'e to not more than of the spaces in a single park will provide a amount of to need park tenants, withuu! unduly burdening the park owner. (b) It is therefore the intent of the People of the State of California in enacting this Measure to do all of the fo/lowing as e maker concern: (1) ReQuire owners of parks to grant directly, without · ' rental subsidies [o not more th~.c, .~,~ f~e,,cer, t ~f their (2) Require iocal to minimize their park rent control measures by allowing annual to the cost of living and require to phase out rent control on a space by space ba.',i.'~ ~Jpon sale, transfer ~r sublease cf any (3) Prohibit of any new park rent ccnt;ol or ren~' law by any local g or by the State of California. lc) This Measure is not intended, nor shall it be to deprive any owner, tenant or park owner of any right,-. SECTION 3: AMENDMENT OF CHAPTER 1 OF DIVISION 2 OFCALIFORt~.~ C!'/ILCODE: Chapter I of Pa~ 2 of Division 2 of the California Civil Code is hereby amended as fo~low, s by adding new Section 798.13, as follows: 798.~.3 As used in this part, the following terms have the following la) "Tenant" means a as defined in Section 79~.9 of this C, haptct. (b~ "Qualified Tenant" who, as of the date of and during any period while receiving a rental satisfies all of th~ tollowing (1) The tenant resides in a park in the State of C, alifornia: and (2) The tenant is a very Iow income as defined in section 50105 of the California Safety Code; and {3) The tenant is not del~ncluent with any rental has legal residency in a and owns and occupies such as the tenant's principal place of residence; and (4) The tenant, including ell other rasid~r'~j ,n the is * with ell rules anC~ of thc parl~ arid the tenant's rental aG (5) The tenant is not receiving any Federal, State or local housing including but not limited under Chapter 8 with section 1404a) of Title 42. United States Code: The Housing and C Act of 1974 (Public Law 93-383); Chapter 45 v, ith section ;3601) of Trcle 42, United State Code; or any other housing program adminis*.ered by the D Housing and Urban or a~ provided by other slate or faders! laws or programs. (c) "Rental subsidy" as used in Article 4.4 of thi.'; pert ~e.sns a ten- percent discount from the monthly rent charged for the space; occ,~p~d by one or more qualified tenants, park man~ge~,.u~tt monthly The monthly rent level of a Ot~ehfied tenant who is receiving or is entitled a rental subsidy, may be increa,~ed and shar~ be as from time to time, so that the ~>~t~-,l¥ ,eat level shall not, at any time, exceed the average monthly rent level chargec 1or all spaces, in the mobilehome park then occupied with Only one rental subsidy shall of how many ciuaiified tenants who reside in a space, so tha~ no mob[lehome be entitled to more than one discount from ',he monthly rent level. (d) "Exempt space" aa used in of this part mean.~ (ii ,.~n¥ space ir~ a park which is not occupied by a as of the effective da~ c,f this Measure, or (ii) any space which is, as of the effective date of this Measure, exernp~ arcm a park rent control law as a result of any lease or renter covermg such space including, without limit, at[on, a rental described in section 7DS 17 of this Chapter. (e) park. as used in Articles 4.4 and 4.5 means any ordinance, ru~e, regulation, or initiative measure, adopted by anv cit.. county o~ city and county, which a maximum amoun', that the of 13ark may charge any tenant for rent. (f) ~ event' as used in Articts 4.5 of this part means, with any space in a park covered by a perk rent CDn.'~ol !aw as et the effective date of this Measure, the of any of the foIIowir~g e~,~,.Is ~tter the effective date of this Measure: (f} Any sale. transfer {by old,radon of law otherwise), or other change in of the {as defined in Section 7gE.3 of this Chapter); (ii) of the tenancy of the persons who are tenants in such s~ace by eviction, or or (iii) Any sub-lease by the ;anent to a third party of the or space of this K4easure, prowded noth;ng contained herein is intended any of the or space, the provisions of subdivisions (i), (ii), and (iii) here;n, be deemed to have occurreO upon any transfer of cf a to the guardian or trustee of a or to a s 995 ITEM 5 ', ? of AAY 16 1995 ITEM 14 trus! (p,ovlded that the ' ' ' entlt~ed to of the a,.? .~¢rnbers of ~he fat1311'F), or to a s;~'~:v;n~ s;:ouse upon :he ~ea'h other spouse, 0r t0 a spouse or the parent(s) 0r Chilaren 0f a tenon: under this Measure, after ~eOuc[ing the renta~ SdDs~0y otherwise tawfully to the tenant. SECTION &: OF CHAPTER 2.5 OF DIVISION 2 OF THE CAL~60~,JIA. CODE CheD~er 2.5 of Par~ 2 of D~vls;on 2 of the CaNforn[a Civ{I Code is ner~D~ foJ~ows Dy ad~mg a new Art;cie 4.~. as follows: Article ~.4 Tenant 798/4.1 A~¥ oualified tenant may apply for and if a¢¢e~ted, sba, r~L'e~,'~,. ,~ :he o~ a ~arK ~n which such tenant resioes, a re~'a~ subsidy subjec: to the terms and conditions provided for ~n :his 7D8.44.2 T~e orovis[on of the rental SuDSiOy S~RII be the sole and obligation of each of a park and neither the E.tate of ~&[[forn~a nor any. agency shall have any :herefor or exercise any authority in except as provided in Section 7D~,a-: E Df A~icte. 798,A~.3 (a) Each ~enan~ seeking ~o obtain a rental subsidy shall p~ovioe wi;h an together w~th evidence of facts, ';o tenan~ is a ~ua~]fied ~enan[, This and evidence may be a~ any subsi0y for ~he ensuing calen0ar year ~ January 1. The evicence the shall consist of and residency ~r., ~ and such income and other ' as ~s recuired Dy agency ' ~ the housing benefits for Very Low Income persons Section 8 of the Uni[ed States Housing Act of 1937 (42 U.S.C. sec. 1437) and such eviOence es is reauired. However, no Dark make this ~rocess more to the would be t~e c~se the tenant were a~Dlying for ~ousing benefits for Very Low Imc3me under Sectmn 8 of the United States Housing AC~ of 1937 ~42 U.S.C. ~ec. (b) Each ~ark menag ~romotW uDo~ receipt of such and evidence specified in ~aragra~b [a}, evaluate t~e same and rep~y to ~enan~ w~h notice within 10 working days. The re~ly shell indicate e~ther (1) in which case the amount of :he rental suosidy and the mon=hiy ren~ l~vel shall ~hen be scared; or [2) rejection, m which case the ~asts for such shah also be stated. Once a ~ualifie~ ~enan= has received a rental s~bs~dy ~ur~nG amy pa~ of a calenOar year, the rental subs,dy shall continue until 31 of ~a~ year, subject to early as provided ;n [~is Article. MAY 1 8 1995 1 6 1995 8 of 12 ?98.44.4 ) any other provision of this Article to tt~ ~'a} ~,!1 tn s~ ' in which Dark ~nt c~n~toI ~5 ~ ~ffect, ~e of a park sha[~ flora the rental subs[dy prows;oas of this Article if, end es long es, more than pt the ~p,~¢ e5 occupied by mobilehomes in such mobilehome park are covered by any form of park ren~ con[roi. (2) In any ' in park rent contrOl iS in effect, if any time of t~ ~ by mobilehomes in a Dark are covered by any form of mobilehome park rent control, the of Dark shall be subject to the provisions of this A~icle and shall be reouired to provide rental subsidy to a qualified tenant; provi0ed, however the[ of the be requ~re~ to ~ovi0e such rental subsidy if granting the subsidy would result in more than of the spaces in the mobUehome park being covere~ either by any form o1 pa~k control or bythe rental prowded byth~s Article. The priority ~or granting renta~ subsidy shat~ be governed ~ ' ' ,c~ of t~ 798.44.4. {b) ~n any ' in which there is no form of Dark rent control eftect, the of a park shell be required to provide the rer,ta~ subsidy ~rovided by this Article to Qualified tenants ~ not more than of the occupied in such park. The priority for granting rental ' sha~! be governed by {c) of section 798.44.4. (C) (1) Jn Jn which ~a)(2) or (b) of th,s sect;on a~Dly, the of a park $halJ be required to gra¢~t the rentat subsidy ~rovided for in this A~icle to those qualihed tenants who are f~rst time to have been granted a rental subsidy by the of park. (2) In ' ' the number of aualified which the of a Dark shall be required to provide rental un3e~ subdiws,on (a}(2), the management of the park shall aetermine the numaEr of ~ue~ified tenants which rental subsidy, by the 0f s~aces then subject to some form of park re~t co~trol fro~ the r~umaer of the total number of s~aces then OCCupied by in the park. 79~.44.5 ~a) Any ~uelified tenant receiving a rental subsidy shall lose the right t0 such rental )sidy upon the of any of the follow~ng events: {1) The Oay the monthly rent in with t~e rental (as reduced by the w~th~n five days ct ~ts Oue dare; 0r (2) The tenant no longer meets the criteria for e Quallfie~ tenant for any reason. 9 of 12 [b) The rnobilehorne park may, upon 10 days' written notice t,> the tenant, term;hate the tenant's rental subsidy for a reason .~pecifled ~n {1} or (2} of (a~. (c) A tenant whose subsidy has been pur.,uant to subdivision {b} may not subsidy for a period of ~ ;- months (d) For purposes of the forth in section 798 44.4. a ret.[al ' ' ~b) shell be deemed to have been on the last day of the 798.44.6. Any or damaged by any violation of [his Article may petition the municipal Court of the judicial district in wh.ch the park is located for a judicial of his or her rights under this Article. aggrieved tenant prevailing in such an action shall to la) actual dame[les c~ns;sting of the amount of rental subsidy lost due to the violation and (b) a~orneys fees and costs. A tenant aggrieved by a violation of tn,s .;,rli~le shal also be entitled to ' ' relief, and any other equitable section 526 of the Code of Civil A juqgment of the municipal court shah be by the appellate of the superior court of the county in which the action arose. 798.~-4.7. (a) A perk' shall not terminate the :ur.~nc~ of any tenant, or do so. or retaliate or ~o result of a request ID for a rental subsidy or the exercise of any r~ghts relating provided in this Article. (b) Any demand by a mobilehome for rent in axce~$ o~ th~ rental charge from any Qualified tenant whose for a rental subsidy is approved for t~e calendar year or whose wes denied violation of this Article shell constitute a defense to any action brought b~ the park management for (1) the excess rent over the rental charge or (2) eviction of the qualifie~ the park for of rem[. However, this ' ' does not apply if of the rental charge would violate any right of the owner of the park ~o a fair rate of return. SECTION 5: OF ARTICLE 4.5 OF PART 2 OF DIVISION 20I~ THE C CIVIL CODE Article 4.5 of Pa~t 2 of Division 2 of the California Civil Code ' to add the following new Sections 798.45.1,798.45.2, and 798.46.3 as follows: 798.46.1 On or after the effective date of this Measure, no city, county, or city county, shell, (a) enact any new park rent control law or (bi amend or rnodlfv any existing park rent control law to apply its on maximum rents to any space in a park which i$ not. on the effective date of this M~e~ure, by )' IAY S 1995 6 10 of 12 1 6 1995 ITEM i reason of a long or under the park rent control law. 798.46.2 Every mobilehome park ~ law in effect as of the ef~ech.e cate of this Measure shall be subject to the following ' ' (e) On or after January 1 of the year following the effective date of th~s MeasurE, no park rant control Jaw may, with respect to the a perk for a space w/thin such park, either (i) re:~uire that the rent for such be reduced from that before the effective date ct this Measure or as of any subsecluent date, or (iii limit any annual rent increase [~ 3~ amo,~nt which is less than the full annual cost of living increase, by the cf,ant'jo in such cost of living from the 12-month period ending in the calendar month precedinr=l the date in which a notice of rent increase is given by the park at any time, and from time to time, after the effective date of th~s Measure. For purposes cf this the cost of living sh~ll be using the Ca~f0rnia Consumer Price tndex ('CCPI"J, as pub~she~ by the ,~t' Re~at;ons for att items and alt urban and th~s index for thc 1,°82-, 284 p(~r~od shaU be computed as 100. ih) No ' any park rent control law ~hal; require the of a park to attend any hearing or submit an~ to - such jurisdiction so [cng es limits the rental increases for any space attected by such mob[lehome park law tO the full annual CCPt ~ncrease as provided in subdivision (a) of this section. {c) On or of this Measure. no park rent control law shall impose any restriction on the amount Of rent that the of a park may Charge for e space w~thin such park upon or after a ct event, as defined in Section 798.13 (fl. (d) On or after the effective date of this Measure, no park rent ]aw shat impose any restriction on the amount of rea! that the of e perk may charge for a space within such park which is an exempt space, as defined in Section 798.1:3 (d). Afl shall be, for all purposes of~ or a/tar effective date of this Measure, exempt from any and all park rent con[roi laws. 798.46.:3 The State of California statute or the restriction of, the maximum amount of of a park may charge for · space in a park. Any statute having e~acted before or date of this Measure shall be void and SECTION 6: AMENDMENT OR REPEAL OF MEASURE The provisions of this Measure may be amended or repealed by ~he set - forth in this section. If any portion of (a) ' invat;d, then (b) shall be the exclusive means of amending this title. (a} The provisions of this be amended to further its purposes by statute, passed * by rollcell vote entered in t~e journal of the ancl signed by the Governor. (b) The provisions of this IV' be emended or repealed by a statute that becomes when approved by the electors. SECTION 7: DATE .'The of thls Measure shall be the day after the electior, at w~,ch i! is approved by the voters. $~:CTION 8: CONSTRUCTION OF MEASURE The Measure shall be liberally construed to achieve The purposes of this Measure and to preserve its validity. SECTION 9: $ Y If any provlsion of this Measure, or the to any I~e,son or is held invalicl or void. such invalidity or voidness shall not affect othe, or which can be given effect without the invalid or void prowsion or and to this end, all of the provisions of this Measure are declared to be SECTION 10: ELECTORS' INTENTION IN THE EVENT OF PASSAGE OF POSSIBLE CONFLICTING MEASURES In the event to be voted on by the voters at the same e~.ction as this Measure, and which e scheme, receives more votes then this Measure, the that any provision ~' ' ' of this Measure not in direct and apparent any provision or ' ' of another Measure, shall not be deemed to be in and shal~ be save:ed from any other provision or provisions of this Measure which are in direct anc~ apparent conflict with the ' ' of another Measure. In such event, the provisions snail be severed according to the provisions of Section g of this Measure upon ~o any court of Y tAY 1 8.1995 ITEM 5 f s tAY 1 6 1995 ITEM 12 of 12 C : for Mobilehome Fairness ' RECEiVEr ty of Po~ay MA GERS OFFICE O. Box 789  ~ay, CA 92064 e ~ai~ess bas 96 ballot. ~e would ~tst~ r~t control through vac~cy -- wh~ curr~t t~ts 333 S. G~nO Ave Sui~e2S20 move, rental ra=es for their spaces ~ould be set by market -- ~d would a ~d LOS Angeles ck~o07~ subsidy progr~ for ~en~ts ~der the s~ate Health ~d Safety code. (2~3)s~-2s22 ~alyses by ~d ho~g e~erts ~dtcate the F~: 891-2828 will have a~ worst a neutral impact on mobilehome houses F~: 8~1-~22~ for 1~- ~d ten,ts '~d may~ because of the subsidy have the effect of houstns for these groups. From the of local ~ the w/11 have several posi:ive ~pac=s. As you ~ow, r~= control h~ be~ a issue ~ m~y Pressure from t~t ~roups or r~= con~rol has resulted ~ t~payer ~se ~d of where they ave been adopted. Some cities have ~ded ~ ~cess of $1 million such ~d costs ~ ~to the h~dreds of of dollars. ~e state's ~alyst, ~ the official ballot s,,mma~, has ~he w~ld save local j :ens of millions of dollars each year. rent control has also ~d distorted the local ~litical process ~ m~y ci~ias. Adoption of the Fai~ess this issue ~d ~eplaces it with ~ ~d f~ded syst~ which protects bo~h t~ts h need ~d property o~ers. At a t~e wh~ ~he public is a ~ the size ~d scope of the Fai~ess offe:s local J a ch~ce =o reduce ~d ~ses while still the public ~ezest. Please join ns ~ the Fal~ess ~etuE the enclosed card ~oday so we c~ add you~ n~e to the g~owhg list of local elected this badly needed refo~. S. Houston James W. Silva Mayor San Diego County City of Dublin Orange County . m,e~V??- may my name to the growing list of elected officials You add who support the Mobilehome Fairness Initiative. Office Jurisdiction Street Address City State Zip Day Phone Evening Phone Fax The ¢31iforni'~ Mobilehome Fairness b,iti-~tive Qualified for the March 1996 Statewide Ballot for Policy A Briefing from Californians for Mobilehome Fairness (213) 891-2822 April, 1995 MAY ]. 8 1995 ITEM .5 CONTENTS Page 1 Summary of Benefits Page 3 Official Ballot Title and Summary Page 4 Text of the Initiative Page 15 Executive Summary - Real Estate and Land Use Institute's Study June 1, 1994. '1995 MU NICIPAL BENEFYI o from passage of the CALIFORNIA MOBIl FHOME FAIRNESS INITIATIVE "In the lOng term, lOCal ng ' Id exp millions to tens Of millionS of doll ' lly Change is in the ~ir. You don't need to be a political expert to know that changes in the way they are governed. At the local level * Better ~ * Improved public safety * More eft' ?tax dollars * More responsive 8 Examples of this shiff : ;~e. Besides reali ' California in 1994, :litionally liberal Massachusetts approved ~ rent control statewide. The messa~t focus on the truly needy and the broader public - not just si: Local& t new ways to safeguard tA ' tout increasing regulatory ~ending limited taxpayer dollars in the proce~ The Mobilehome Fairness Initiative offers just such an opportunity. The Mobilehome Fairness ] ~e trend in C J less 8 t I while retaining loc ~the public good and promoting changes imi: Average mobile~ period is 10 years. A decade will pass before this law is fully implemented. The Initiative offers a 10% rent subsidy to 10% ofresid led parks - 60% of the state 'spark residents, equal to 300,000people will be immediately eligible if they quailS. Qualification is based on Section 50105 of the California Health and Safety Code criteria. Park )ayers, pay for the subsidy. B By g the need for costly enf b )' and litigation expenses, the Mobilehome Fairness I !1 save taxpayers millions of dollars that can be used on vital publ like police and fire p p community priorities these days. Th ~ported by broad-based ting park resident rej: parkowners, taxpayer groups, and oth 3' and civic organizations. Because the subsidy will I; ~le to tens of thousands of park tiately, whil' y offering parkowners the regulatory relief they need to stay in business, and because local 8 will benefit fi.om phasing out layers of regulatory bureaucracy, this initiative has the opportunity to be a win- win-win for California. Polls show that if th /ay, 63% of Id vote yes on the initiative because of its progressive reforms and benefits for local g budgets. i What other factors make th' nes Th t at th t of ~er tl~ )lie- home neighborhoods. Publ' has shifted in favor of targeted assistance rather than blanket benefits regardless of need. Independent studies prove that while th ' tfall to park residents wh is introduced, the benefits disappear when first 8 sell their h ting tenants. Over the long term, the free market provides more equitable protection for both parkowners and tenants. Rent control is a d There have been no mobilehome parks built in California in the last five years, and th plans to build any. This h ' leading to a shortage of ,le and affordable housing ~ecially f :1 young families. For further information pi ' James Vaughn a~ (213) 891:2822~ 1995 ITEM 5 Title & Summary MOBILEHOME RENT ASSISTANCE. MOBILEHOME RENT CONTROL RESTRICTIONS. INITIATIVE STATUTE. Requires mobilehome park management to administer and provide rent subsidy equal to ten percent discount / rent to tc ag residency and income req~ when ten percent or less of occupied si: t by rent control or rent subsidy. Establishes priorities for, and conditions for losing, rent subsidy. Invalidates existing, and prohibits new, state mobilehome rent control laws. Prohibits such laws ~rom requiting reductions in rent and limiting increases in rent to less than specified cost of living index. Summary of estimate by Legislative Analyst and ~ Finance of fiscal impact on state and local I~ No impact term, cities and counties may expe~ience increased costs which are unknown, but are not likely to total more than millions of dollars anm~*lly. In the long term, local a// t cxg ~s of million to t~ns of ~ doll ~ ry. January 27,. 1994 ~¥ 1 8 ~995 ITEM AN INITIATIVE MEASURE TO BE SUBMITTED DIRECTLY TO THE VOTERS The Attorney C-eneral of California has prepared the following title ~xi summary of the chief'purpose and points of the proposed measure: (Here set forth the title ~md summary prepared by the Attorney C~neral. This title and summary must .tsu be ~ the top of each page of the petition w~ )pear.) To the Honorable Secretary of State of California: We, the undersigned, registered, qualified voters of C ' dents of County (or city or county), hereby propose amendments to the California Civil Code, relating to establishment of )sidy for qualified poor and needy mobilehome park tenants, 1/ )ilehome park in lien thereof, and prohibitions of ~mobileE measures by the State and by local charter and general l t t petition the Secretary of State to submit tl~ ae voters of California for their adol: the next succeeding 1/ The proposed statutory amendments (full title and text of the measure) read as follows: SECTION 1: Title This Measure shall be known and may be cited as The Mobilehome Fairness and Rental Assistance Act, SECTION 2: Findings and E ?Purpose A. The People of the State of California find and declare as follows: 1. S :' mobilehome spaces in mobilehome parks in C poor and needy and are urgently in need of without delays, red tape which state and local ~ ' y requires of th ' ' I~iAY 18 1995 ITEM -4- 2. Over $0 local i~ ting millions of dol~ a~d ~forc'mg mobilehome park rent controls for t~ benefit of owners of mobilehomes which comprise approximately only.5% of California's housing units with unrestricted controls that are generally the poor, so that mobileh~ '~ilehomes with nn average value of $40,000 to $50,000 obtain unfair 1= ' led area~ at the expense of~mall busine~s-parkowners and all t~ ~C ' 3. TI controls jeopardize th ~' ~ilehome park housing for all Californians and jeopard ~d employment and small business-parkowners' ' California; and 4. Requiring the provision ofd ' >sidles by requiring mobilehome park owners to provide specified reduced rents for the poor, together with the ~' features of rent I~' ' gch have ndversely affected the availability and supply of such affordable mobilehome housing, is necessary to n~sure the continued availability of affordable mobilehome housing to the poor; and 5. The limitation oft~ ~sidy provided in this M than 10% of the Sl~ >ilehome p~rk will provide a reasonable nmount of .~dy mobilehome park tenants, without unduly burdening the property interests of the mobilehome park owner. B. It is therefore the intent oftha People of the State of Cal'tfornia in enacting this Measure to do all of the following statewide concern: 1. R :'mobilehome parks to grant directly, without ~n ~, ' ~sid ~an 10% of their mobilehome sp 2. Require local 1~ ' ' ' ~eir mobilehome park measures by allowing equal to the cost of living and require local I~ phase ' ~, on a space by space I~ai$, upon the sale, ~lease of any mobilehome. 3. Prohi~ : of eny new mobilehome park rent control or rent law by any local ~n by the State of California. -5- C. This 1~' ted, nor shall it I to deprive any mobil ~ilebome park owner of any SECTION 3: Amendment of Chapter I of Division 2 of Californht Civil Code (D~-itions) Ch&pter One of Part 2 of Division 2 of the California Civil Code is hereby amended as follows by adding new Section 798.13, as follows: 798.13 As used in this part, the following terms have the following meanings: A. "Tenant" means a 1~ defined in Section 798.9 of this Chapter. B."Quali~ed Tenant" means any tenant who, as of the date of application, and during any period wi ' ' ~ a rental ~sidy, satisfies all of the following 1. TI ' :les in a mobilehome park in the State of California; and TI -y l household, as defined in Section 50105 of the California Health and Safety Code; and 3. The delinquent with any rental payments, has established a legal residency in a mobilehome, and owns and occupies such mobilebome as the tenant's principle place of residence; and 4. Th :ling all other residents regularly residing in the mobilehome, is in compliance with :l regulations of the mobilebome park and the 5. T~ ' ' g any Federal, State or local housing assistance, including but not limited :let Chapter $ ( g with Section 1404a) of Title 42, United States Code; The Housing and Community Development Act of 1974 (Public Law 93-383); Chapter 45 ( g with ~'tion 3601) of Title 42, United State Code; or any other ~ housing assistance ~ ~ by the Department of Housing and Urban Development or as provided by other state or federal laws or programs. IYIA¥ 1 8 1995 ITEM -.6- C. "R )sidy' as used in Article 4.4 of this I: 10% ~' the monthly rent ~ for the mobilehome space occupied by qualified ~ished by mobilehome park management (the pre-subsidy monthly rent level). The pre-subsidy monthly rent level of a q w~ ' ' ~ or is entitled to race subsidy, may I ! shall be decreased, as appropriate, that the pre-subsidy monthly rent level shall not, at any time, exceed the average monthly rent level charged for all spaces in the mobilehome park then occupied with mobilehomes. Only )sidy shall apply to any mobilehome space regardless ofhow many qualified tenants who reside in a mobilehome space, so that no mobilehome space shall be entitled to more than one 10% ~ ~e pre'subsidy monthly rent level. D. "Exempt space" as used in Article 4.5 of this part means (I) any space in a mobilehome park which' :~ied by a mobilehome as of the effective date of this Measure, or (ii) any space which is, as of the effective date of this Measure, exeml: ~ilehome park rent control I ~any I ~ such space including, without l ~ described in Section ?98.1 ? of this Chapter. E. "Mobilehome park "as used in Articles 4.4 and 4.5 of this I: ! ord' , ~lation, )ted by any city, county or city and county, which establish amount that the management of a mobilehome park may charge any · Jent for rent. F. "Decontrolling Event" as used in A~ticle 4.5 of this part means, with respect to any si: ~ilehome park covered by a mobilehome park law as of the effective date of this Measure, the ~any of the following events after tt ~'this Measure: (I) Any, by t' operation oflaw or otherwise, or other chamt ~ip of the mobilehome (as defied in Section 798.3 of this Chapter); (ii) Any ~the tenancy of the persons wl~ ~ space by eviction, voluntary vacancy or otherwise; or (iii) Any sub-lease by t~ ~ird party of the mobilehome or space a~er the effective date of this Measure, provided 1995 [TI:M 5 nothing contained ~ ' ' ied to authorize any such sub-lease of the mobil :)ace. Notwithstanding the ~ ' ' :' subdivisions (l), (ii), and ('tii) herein, no decontrolling event shall be deemed to I i upon any transfer of' ownership of a mobilebome to t~ guar~li,~ ~ a ~ ~ provided that the beneficiaries entitled to ownership of the mobile~ ~ of the ~ ~iate family, ' ' ~ spouse upon the death of the other spouse, or to a spouse or the parent(s) or children of a "Subsidized Rental Charge" means t~ ~rent chargeable to the qualified tenant under this Measure, aRer deducting the subsidy from the rent otherwise lawfully chargeable to the tenant. SECTION 4: Amendment of Chapter 2.5 of Division 2 of the California Civil Code Chapter 2.5 of Division 2 of the California Civil Code is hereby amended as follows by adding a new Article 4.4 as follows: Article 4.4 Tenant Rental Assistance 798.44.1 Any qualified tenant may apply for and if accepted, s~ ' directly ~om the management of a mobilebome park in which such tenant resi~ subsidy subject to the terms and conditions provided for in this Article. 798.44.2 The provision oft~ )sidy shall be the sole responsibility and obligation of each management of a mobilehome park and neither the State.of Calif / g ~ency shall have any responsibility t~ any authority' ~erewith, except as provided in Section 798.44.6 of this Article. 798.44.3 (a) Each ' ~g to o~ ~sidy shall provide the management with an application, together with competent evidence of facts, to prove the tenant is a qualified tenant. This application and evidence may be submitted at any time during any calendar year up to December 15 for consideration oft~ subsidy for the ensuing calendar ) ' ~ January 1. The evidence accompanying the application shall consist of ownership and residency in the ]i~,~¥ 1 8 1995 -8- mobile, home ~nd such income and other inf uily required by the ~ lency ~lministering the housing assisiance ben,ts for V~y Low Income I Section 8 of the United States Housing Act of 1937 (42 U.S.C. sec. 1437) and such ot~ [y required. )bile, home park ~ shall make this application 1: burdensome to the tanant than would be the ca~ ift~ ~plying for housing · ssistance benefits for V~y Low Income persons under Section 8 of the United States Housing Act of 1937 (42 U.S.C. sec. 1437). B. Each mobilehome park management shall, promptly upon receipt of such application and evidence specified in paragraph (a), evaluate the same and reply to such tenant with notice within 10 working days. The reply shall indicate either (1) acce~ ich case th f'the rental )sidy and the pre-subsidy monthly reat level shall then be stated; or (2) rejection, in which case the basis for such rejection shall also be stated. Once a quali6ed tenant has received subsidy during any part ora calendar year, t~ ~sidy shall during any part of a calendar year, the rental ~sidy shall '1 D~raber 31 ofthat year, subject to early provided in this Article. 798.44.4 Notwithstanding any other provision of this Article to the contrary: A. (1) In any juri~ i~ich mobilehome park is in effect, the management ofa mobilehome park shall be ~x~apt from the ~sidy 1~ ' ' ~this A t as long as, more than 10O/~ of the spaces occupied by mobile~ ~ mobilehome park are covered by any form of mobilehome park 2. In any jurisdiction in which mobilehome park is in effect, if at any time fewer than 10% of the spaces occupied by mobile~ ')ilehome park are covered by any form of mobilehome park the management ofa mobilehome park shall be subject to the ~ ' ' ,~this Article and shall be required to provi~t' )sidy lo a qualified tenant; provided, however, that the management oftbe mobilehome park sh~li, not be required to provide such )sidy if granting the subsidy would result in more than 10°4 of the spaces in the mobilehome park being covered either by any form of mobi]ehome park or by the rental 1 8 99s ITEU 5 ~sidy provided by this Article. The priority for granting ~sidy shall be governed by subdivision (c) of this section 798.44.4. B. In any jurisdiction in which there is no form ofmobilehome park rent control in effect, the management ofa mobilehome park shall be required to provide the rental ~sidy provided by this Article to qualified tenants representing not more than 10% of the spaces then occupied by mobileh ~ mobilehome park. The priority for granting rental :~sidy shall be governed by subdivision (c) of' this section 798.44.4. C. (1) I ~ich subdivision (a)(2) or subdivision (b) of this section apply, the management ofa mobilehome park shall be required to grant the rental >sidy provided for in this Article to those qualified tenants who are iq have been granted a rental >sidy by the management of the mobilehome park. (2) In determining the number of qualified rich the management ofa mobilehome park shall be re required to provide rental ter subdivision (a)(2), the management of the mobilehome park shall determine the number of qualified tenants which represent sp t to the rental subsidy, by subtracting the number of spaces then subj form ofmobilehome park from the number representing 10% of the total number of spaces then occupied by mobilehomes in the mobilehome park. 798.44.5 A. Any qualified g a rental ~sidy shall lose the right to such rental >sidy upon th ~'any of the following events: 1. The tenant fails to pay the monthly lance with th : (as reduced by the rental )sidy) within five days of its due date; or 2. Th longer meets the criteria for a qualified tenant for any reason. B. The mobilehome park management may, upon 10 days' the tenant, ~ )sidy f specified in paragraphs (1) or (2) of subdivision (a). z 8 995 ITEM -10- C. A terumt wh~ ~sidy has I pur~mnt to subdivision (b) may not reapply t' )sidy for a period of 12 months therea~er. D. For purposes of the 10°/~ 1 forth in ~tion 798.44.4, a renud )sidy terminated [ xiivision (b) shall be deemed to have l: on the last day ofthe calendar year. 798.44.6 Any qualified ieved or damaged by any substantial ' ~ ,"this Article may petition the municipal court of the judicial d ~ich the mobilehome park is located for judicial d f'his or E ter this Article. An aggrieved tenant prevailing in such 1all be entitled to (a) actual damages consisting of rE F )sidy lost due to f2 t (b) reasonable attorneys fees and costs. A tenant aggrieved by ~this Article shall also be entitled to seek' ' 'ief, and any other equitab] under section 526 of the Code of Civil Procedure. A judgment of the municipal court shall be reviewable by the appellate department of the ~the county in which th 798.44.7. (a) A mobilehome park's management s~ the tenancy of any tenant, or attempt to do so, or retaliate against any tenant, or attempt to do so, as a ~ .~a request by that tenant t' )sidy or the exercise of any" g thereto as provided in this Article. (b) Any demand by a mobilehome park's management f ofthe subsidized rental charge from any qualified tenant whose application for a rental ~sidy is approved for the calendar year or whose appF denied or rejected ."this Article shall d ~' ~tion brought by the mobilehome park = for (l) th the subsid ge or (2) eviction of the qualified le mobilehome park for non-payment of that However, this subdivision does not apply ifenF ~the subsidized rental charge would violate any ?the owner of the mobilehome park to a fair rate of return. SECTION 5: Amendment of Article 4.5 of Pan 2 of Division 2 ofthe California Civil Code MAY 1 8 1995 ITEM 5 Article 4.5 of Part 2 ofDivision 2 ofthe California Civil Co~ i the following new Sections 798.46.1,798.46.2, and 798.46.3 as follows: 798.46.1 On or aider the eft' ' ?this M' .~, county, or city and county, shall, (a) enact any new mobilehome park law or (b) amend or modify, any existing mobilehome park law to apply' ! s~ '~ilehome park which is not, on t~ ' this Measure, by reason ora long term lease or otherwise, subj under the mobilehome park law. 798.46.2 Every mobilehome park I' ?tl~ of this Measure shall be subject to the following provisions: A. On or ~,ffer January 1 of the year following t~ ."this ~ilehome park law may, with respect to the rent which a mobilehome park management may charge for a sp~ce within such park, either (l) require that the rent for such space ever be reduced f~om that lawfully clutrged before th ~thJ of any subsequent date, or (ii) limit any which is less than the full , f'living ' by the cl~nge in such cost of living f~om the 12-month period ending in the calendar month preceding the date in which a notice of given by the mobilehome park manag .~ time, and time, at:ret the effective date of this Measure. For purposes of this paragraph, the cost of living shitll be detern~ned using the California Consumer Price Index ("CCPI"), as published by the Department of Industrial Relations for t ail u and this index for the 1982-1984 period shall be computed as 100. R No jurisdiction administering any mobilehome park law shall require the management ofa mobilehome park to attend any hearing or submit any ~' ~ j long as n ~ts for any space affected by such mobilehome park rent control law to the full annual CCPI' provided in subdivision of this section. C. On or meter the effective date of this M' ')ilehome park rent control law shall impose any 1 ."rent that the management of a mobilehome park may charge for a mobilehome 1995 ['i"E[~ 5 space within such park upon or after a decontrolling event, as defined in Section 798.13.(0. D. On or after the effective date of this M ~ilehome park rent control law shall impose any t~ ~rent that the management ofa mobilehome park may charge for a space within such park which is an exempt space, as defined in Section 798.13 (d). All exempt spaces shall be, for all purposes on or after the c ' ~' this Measure, exempt fxom any and all mobilehome park laws. ?98.46.3 The State of California shall 5, or authorizing th ~ tl~ ~rent that the management ora mobilehome park may charge for a s~ ~ilehome park. Any statute having that effect and enacted before or after the effective date of this Measure shall be void and unenforceable. SECTION 6: Amendment or Repeal of Measure The I: ' ' ?this Measure may be amended or repealed by the procedures set forth in this section. If any portion of subdivision (a) is declared invalid, then subdivision (b) shall be t~ ~amending or repealing this title. A. The 1~ ' ' ~this Measure may be amended to further its purposes by statute, passed in each house by roll call ~e journal, two-thirds of the membership concurring and signed by the Governor. B. The ~ ' ' ~this Measure may be amended or repealed by a statute that becomes effective only when approved by the electors. SECTION 7: Effective Date The effective date of this Measure shall be the day after tE rich it is approved by the voters. -IS- SECTION 8: C ~'Measure The Measure shall be liberally construed to achieve the purposes of this Measure and to didity. SECTION 9: Severability If any provision of this Measure, or the app]' ~' 1: held invalid or void, such invalidity or voidness shall not affect other F ' ' applications which can be 8' aout the invalid or void F ' ' application, and to this end, all of the 1: ' ' ?this Measure are declared to be severable. SECTION 10: Electors' I ae Event of Passage of Possible Conflicting Measures In tl: aer Measure to be voted on by th ~ ~is Measure, and which ~rehensive regulatory sc~ ~ ~an this Measure, tl~ t that any ~ ' ' provisions of this M direct and apparent conflict with any 1~ ' ' F ' ' ~' another Measure, shall not be deemed to be in conflict therewith, and shall be severed from any other 1: ' ' I~ ' ' ?this Measure which are in direct and apparent conflict with the provision(s) of another Measure. In such event, the p ' ' ~all be severed according to the F ' ' ? Section 9 of this Measure upon app] court of competent jurisdiction. -14- RENT CONTROL ISSUES AND IMPACTS ~TAT~ & ,.AND N~TITUTE SCHOOl. OF BUSINGS A CALIFOI~NIA ~'TATE UNIV~,.~, SAC~J~.NTO 7750 Collese Town Drive, Suite 102 Sacramento, CA 95626-2344 916/278-6633 June 7994 1995 ITEM 5 EXECUTIVE SUlVIlViARY The objective of this project is to review the impact ofreslrictive rent control pop t housing issues; to compare objectives The study concentrates on citi, , ~ive rent control, because it' ' ies that the intent of ly not meet their intended goals. The 1980 and 1990 C ~ared to ascertain the percent change between Berkeley and a raf Al' t Santa Monica, and its ref ,y, Los Angeles. The results indicate that: Both Berkeley and Santa Monica lost rental housing units (single-family detached and single-family attached units) while their ref ies added to their rental housing stock. Both cities lost stmc! while their ref ies gained this type of housing structure. · Both Berkeley and Santa Monica showed decli~ r-occupied rooms while their ref ies gained renter-occupied rooms Both cities and both counties gained ~ied rooms. · Rent y cause biases against certain age groups. The data indicate that family composition may be affected ~er of persons in their early child-bearing years is declining in both cities. Also, despite the rapidly aging society, the elderly popula6 declining or barely increasing in both of these cities, counties, the elderly populati ~ rapidly. · Both declines in the percent of the population that rented. The greatest decli~ ~ White renters. While the proportion of Hispanic rem t for the subject and ret' that proportion did not' fast in the tw ies. · Overall, { :ers declined in both cities. In Berkeley, the declines were greater. Although the proportion of] increased in Santa Monica, ~ did not keep p county increase. 1995 · The coml= ' ' that rent control benefit to but it is not clear that the groups for whom thc benefits ted are the actual recipients. · Gentrificalion (that is, the disp] Fl t educational status renters by hi~ t educational status owners) is the opposite of what the rent control ~ to achieve, but' ~ in both cities. The two reslrict~ [ cities have b ~ly inhabited by higl~ er= educated 1~ : control. The data show that the restrictive rent control .'keley and Santa Monica do not meet their stated goals. Instead, the groups for whom .~pear to be the least likely to receive benefits, and appear to be leaving these two cities to find rental housing elsewhere.