A. There are five mobile home parks with a total of three hundred ninety-nine spaces in the city of Marina.
B. Studies Prior to Adoption of Chapter. In 2009, the city commissioned two studies of the mobile home park space rental market by experts with extensive experience on issues related to mobile home park tenancies.
C. Rent Increases. From 2002 to 2009, rent increases in the parks substantially exceeded the percentage increase in the Consumer Price Index (CPI). In four of the five mobile home parks in the city, rent increases during this period exceeded forty percent compared with a sixteen percent increase in the CPI during this period. In one park rents increased by sixty-four percent during this period.
D. Captive Nature of Mobile Home Park Tenancies. As a practical matter, the mobile homes in Marina’s mobile home parks are “immobile” homes. As of 2009, fifty-one percent of the mobile homes were manufactured before 1980 and seventy-three percent were manufactured before 2000. Very few mobile home parks in the area will accept mobile homes that are more than a few years old. The cost of moving and setting up a mobile home in a park is substantial.
About half of the mobile homes are “doublewide” structures that consist of two ten- or twelve-foot-wide sections that are joined together when they are installed on a lot on top of a simple foundation.
Mobile homes are rarely moved after they are placed in mobile home parks. When mobile home park residents move they sell their mobile homes in place.
Special characteristics of mobile home park tenancies in urban areas generally include the following:
1. The “historical” investments of the mobile home owner (tenants) in mobile homes in mobile home parks generally exceed those of the landlord park owners.
2. The physical relocation of mobile homes is costly.
3. Relocation within metropolitan areas is practically impossible because there are virtually no vacant spaces in mobile home parks.
4. Park owners generally will not permit older mobile homes to be moved into their parks when they do have vacant spaces for rent.
5. The supply of mobile home park spaces in urban areas in California is either frozen or declining. Mobile home park construction in urbanized areas of California virtually ceased by the early 1980’s as alternative land uses became more profitable and land use policies continually tightened restrictions on the construction of new mobile home parks.
The investments of mobile home park residents in their mobile homes are “sunk” costs. The benefits of these investments can only be realized by continuing occupancy in the mobile home or by an “in-place” sale of the mobile home.
In 2001, the California Supreme Court concluded:
THE MOBILEHOME OWNER/MOBILEHOME PARK OWNER RELATIONSHIP
This case concerns the application of a mobilehome rent control ordinance, and some background on the unique situation of the mobilehome owner in his or her relationship to the mobilehome park owner may be useful. “The term ‘mobilehome’ is somewhat misleading. Mobile homes are largely immobile as a practical matter, because the cost of moving one is often a significant fraction of the value of the mobile home itself. They are generally placed permanently in parks; once in place, only about 1 in every 100 mobile homes is ever moved. [Citation.] A mobile home owner typically rents a plot of land, called a ‘pad,’ from the owner of a mobile home park. The park owner provides private roads within the park, common facilities such as washing machines or a swimming pool, and often utilities. The mobile home owner often invests in site-specific improvements such as a driveway, steps, walkways, porches, or landscaping. When the mobile homeowner wishes to move, the mobile home is usually sold in place, and the purchaser continues to rent the pad on which the mobile home is located.” (Yee v. Escondido (1992) 503 U.S. 519, 523, 112 S.Ct. 1522, 118 L.Ed.2d 153.) Thus, unlike the usual tenant, the mobilehome owner generally makes a substantial investment in the home and its appurtenances—typically a greater investment in his or her space than the mobilehome park owner. [cite omitted] The immobility of the mobilehome, the investment of the mobilehome owner, and restriction on mobilehome spaces, has sometimes led to what has been perceived as an economic imbalance of power in favor of mobilehome park owners. (Galland v. Clovis, 24 Cal.4th 1003, 1009 (2001))
Court opinions and academic reviews have repeatedly noted the captive nature of mobile home park tenancies. For example, in one case the Florida Supreme Court concluded that mobile home owners face an “absence of meaningful choice” when their space rents are increased:
Where a rent increase by a park owner is a unilateral act, imposed across the board on all tenants and imposed after the initial rental agreement has been entered into, park residents have little choice but to accept the increase. They must accept it or, in many cases, sell their homes or undertake the considerable expense and burden of uprooting and moving. The “absence of meaningful choice” for these residents, who find the rent increased after their mobile homes have become affixed to the land, serves to meet the class action requirement of procedural unconscionability. Lanca Homeowners, Inc. v. Lantana Cascade of Palm Beach, Ltd., 541 So. 2d 1121, 1124 (Fla.), cert. denied, 493.
In response to the special situation of mobile home park residents, California has adopted landlord-tenant laws which provide special protections for mobile home park tenants. (California Civil Code Section 798.)
In addition, approximately ninety jurisdictions in California have adopted some type of rent control of mobile home park spaces. Typically the rent control ordinances tie annual allowable rent increases to the percentage increase in the Consumer Price Index (CPI)—All Items. Most of the ordinances do not permit additional rent increases (vacancy decontrol) or limit rent increases to ten percent or less when a mobile home is sold in place. Under all ordinances, park owners are entitled to petition for additional rent increases in order to obtain a fair return.
E. Income Level of Mobile Home Owners. As of 2009, thirty-three percent of the mobile home owner households had annual incomes of twenty thousand dollars or less and twenty-eight percent had an annual income between twenty thousand dollars and twenty-nine thousand, nine hundred ninety-nine dollars. In comparison, in 2008, the income ceilings for households classified as “very low” income under federal HUD standards (fifty percent of area median income or under) are twenty-two thousand, seven hundred dollars for one-person households and twenty-five thousand, nine hundred dollars for two-person households. The income ceilings for households classified as “extremely low” income (thirty percent of area median income or under) are thirteen thousand, six hundred dollars for one-person households and fifteen thousand, five hundred dollars for two-person households.
F. Mobile Home Owners’ Investments. Mobile home owners, unlike apartment tenants or residents of other rental units, are in the unique position of having made a substantial investment in a residence which is located on a rented or leased parcel of land. Their investment commonly includes the purchase of the mobile home and the cost of installing the mobile home on its space and installing related improvements such as a foundation, carports, and integrated landscaping.
The 2009 studies commissioned for the city found that long-term residents have typically paid prices in the range of twenty thousand dollars to forty thousand dollars for their mobile homes and that mobile home owners who have moved in since 2000 had paid an average of ninety-five thousand dollars for their mobile homes. Their investment commonly includes the purchase of the mobile home and the cost of installing the mobile home on its space and installing related improvements such as a foundation, carports, and integrated landscaping. Excessive rent increases may drastically reduce or eliminate mobile home owners’ equity in their mobile homes, causing mobile home owners to lose a substantial portion or all of their investments in their mobile homes.
G. Fair Return. A “maintenance of net operating income” (MNOI) standard is a “fairly constructed formula,” Rainbow Disposal Co. v. Escondido Mobilehome Rent Review Bd., 64 Cal. App. 4th 1159 (1998).
H. Adoption of Chapter Would Not Have Significant Environmental Impacts. Adoption of this chapter is not subject to the California Environmental Quality Act (CEQA) pursuant to Section 15060(c)(2)—the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment, and Section 15060(c)(3)—the activity is not a project as defined in Section 15378 of the CEQA Guidelines because it has no potential for resulting in physical change to the environment, directly or indirectly. (Ord. 2011-05 § 1 (Exh. A), 2011)