Connect with CP&DR

facebook twitter

Follow us on Facebook and Twitter

Local Control Over Mobile Home Park Conversions Limited

Cities and counties have little authority over the conversion of mobile home parks to resident-owned subdivisions, the First District Court of Appeal has ruled.

"If the Legislature ever did leave the field of mobile home park legislation to local control, that day is long past," Justice James Richman wrote for a unanimous three-judge panel that invalidated a Sonoma County ordinance because it was superceded by state law.

Backed by mobile home residents and affordable housing advocates, local governments have tried to block the conversions to preserve affordable housing stock. Mobile home parks often make up a substantial portion of a jurisdiction's low- and moderate-income units, and many parks are subject to rent control. But a park that has been converted into condominiums or a common-interest ownership is exempt from local rent control ordinances even if most spaces in a park remain under the same ownership and residents continue to rent the same spaces. The First District decision, appears to jeopardize efforts to block suspect conversions. However, a bill pending in the state Senate could increase local authority.

In the case before the appellate court, the Sonoma County Board of Supervisors had adopted an ordinance in May 2007 that placed conditions on mobile home park conversions. Among other things, the measure prohibited a conversion unless the park owner could show that at least 20% of his renters supported it. The ordinance also required a tenant impact report, a maintenance inspection and detailed plans for funding maintenance of infrastructure and common areas.

The owners of Sequoia Gardens Mobile Home Park outside Santa Rosa sued, contending the ordinance violated state law and was an improper taking of private property. They asked a Superior Court to invalidate the ordinance and award damages. In 2006, the owners had sued to block the county from imposing a moratorium on park conversions, demanding tens of millions of dollars in damages.

Sonoma County Superior Court Judge Raymond Giordano upheld the Sonoma County ordinance, a decision the First District Court of Appeal, Division Two, overturned.

A local ordinance is preempted if it duplicates, conflicts with or "enters an area fully occupied" by state law, Richman explained in the appellate panel's ruling, citing Big Creek Lumber Co. v. County of Santa Clara, (2006) 38 Cal.4th 1139 (see CP&DR Legal Digest, August 2006). The state has regulated at least some aspects of mobile home parks and mobile home construction since the Legislature passed the Mobilehome Parks Act in 1967. Other related state laws were approved in following years.

Of primary importance in this case were portions of the Subdivision Map Act dealing with mobile home parks, especially Government Code 66427.5. That section, first adopted in 1991 and amended in 1995, "is a fairly straightforward statute addressing the subject of how a subdivider shall demonstrate that a proposed mobile home park conversion will avoid economic displacement of current tenants who do not choose to become a purchasing resident," Richman wrote. The statute permits park owners to raise rents on tenants who do not buy their lot to market rates over the course of four years after a conversion, and it limits rent increases for low-income tenants.

In 2002, an appellate court in El Dorado Palm Springs, Ltd. v. City of Palm Springs, 96 Cal.App.4th 1153, ruled that 66427.5 prevented a city from adding conditions to a proposed mobile home park conversion (see CP&DR Legal Digest, June 2002). In response, the Legislature added subdivision (d) to 66427.5, which required park owners to submit a "survey of support of residents" when applying for conversion approval. The stated intent was to ensure that conversions were "bona fide," and not a sham to avoid rent control. But lawmakers did not set a required minimum level of support among park residents.

In their suit, the Sequoia Gardens owners argued that the state law made the county's approval of proposed mobile home park conversions almost ministerial. The county countered that state law only addressed the economic displacement of park residents, and therefore the county had broad discretion.

The appellate court said the Legislature's response to the El Dorado decision was telling. "[T]he El Dorado construction of 66427.5 has stood the test of time and received the tacit approval of the Legislature. We therefore conclude that what is currently subdivision (e) of 66427.5 continues to have the effect of express preemption of the power of local authorities to inject other factors when considering an application to convert an existing mobile home park from a rental to a resident-owned basis," Richman wrote.

Toward the end of the opinion, Richman said the county's attempt to ensure that conversions are bona fide was commendable but not legal under existing state law. "Of course, if the Legislature disagrees with our conclusion, or if it wishes to grant cities and counties a greater measure of power, it can amend the language of 66427.5," Richman wrote in an apparent invitation to state lawmakers.

Last year, lawmakers approved AB 1542 (Evans), which would have increased local control over conversions and maintained rent control on spaces not purchased by mobile home owners. Gov. Schwarzenegger vetoed the bill, saying a more comprehensive approach was needed. AB 566 (Nava), which is pending in the state Senate, would permit local governments to consider the level of support for conversion among mobile home park residents. The bill was watered down in a Senate committee to eliminate a requirement that a majority of park residents support the conversion.

The Case:
Sequoia Park Associates v. County of Sonoma, No. A120049, 2009 DJDAR 12533. Filed August 21, 2009.
The Lawyers:
For Sequoia Park Associates: Elliot Bien, Bien & Summers, (415) 898-2900.
For the county: Sue Gallagher, county counsel's office, (707) 565-2421.