On Thursday, the Fresno City Council will hear a request from Harmony Communities to shut down its La Hacienda Mobile Home Park.
Meanwhile, a lawsuit from a Petaluma mobile home park owner seeks to undo a law preventing the owner from selling a park there.
More than 100 cities throughout California have special rules for mobile home parks.
Many require park owners to conduct studies on how closing would affect residents. The owners then have to report how they would compensate residents for their lost homes. And, a closure impact report has to be approved by local officials before a park closes.
Officials look at mobile home parks differently than other forms of housing because people living there often own the homes but not the land. But because moving a mobile home can be expensive, residents often leave the trailers behind if the park closes.
In addition, mobile home parks are often seen as the last bastions of affordable housing.
City Must Hold Harmony Communities Accountable: Karbassi
City of Fresno staff recommends that councilmembers reject Harmony’s report because the city attorney’s office says the report is inadequate.
Fresno City Councilmember Mike Karbassi says that in light of Harmony’s commitment two years ago not to sell, the council has a responsibility to hold the company accountable.
“Not even two years later when they said they weren’t going to sell and now they’re trying to sell,” Karbassi said. “I think we have a responsibility to no longer take them at their word and ensure we hold them accountable.”
We Have a Legal Right to Close the Park: Owners
Petaluma’s Little Woods Mobile Villa houses people of all ages — a majority of them Spanish speakers — in its 78 spaces.
Residents of Little Woods Mobile Villa received notices that their monthly rent would more than triple in the coming year, according to KTVU, the Sinclair News affiliate in Petaluma. For one resident, that meant going from a $500 monthly rent to more than $2,215 a month.
Harmony Communities manages Little Woods Mobile Villa but is not involved in any litigation, according to a company representative.
Like Fresno, Petaluma limits how much rents can be raised. In August, Petaluma officials strengthened the city’s protection for renters, capping increases to either 4% or 70% of the Consumer Price Index — whichever is lower. Using the current CPI, rents in the park are capped at a 2% yearly increase.
Property owners wanting to raise it more than the limit have to seek approval from the city.
Rent control laws have limited park owners’ ability to pay their expenses, forcing them to close the park, the lawsuit alleges.
“This inevitability has forced Little Woods … to begin the park closure process, rather than continue to operate a business that is doomed to become insolvent,” the lawsuit states.
Lawsuit Challenges Rules About Closing Parks
The Petaluma park owners say that the state cannot compel a business to continue to operate and that merely bringing in enough rent to stay in business is not “a fair return.”
They said a fair return consists of rents that cover the reasonable costs of maintaining and operating the rental property and a reasonable return on capital.
The lawsuit also blames mobile home owners who rent instead of purchasing land.
“Mobilehome owners make the deliberate economic decision to lease the land for a fraction of the cost of land ownership and thereby accept the known risk — as leaseholders — that the landowner can close the park and require their relocation,” the lawsuit states.
City of Fresno May Decide on La Hacienda’s Future Thursday
Back in June, Harmony submitted its tenant impact report to Fresno officials minus a required appraisal of the mobile homes. It wasn’t until September that the company returned an amended report.
The company has set aside $225,000 to buy residents’ mobile homes and help with moving costs. But those funds are only for tenants in good standing.
On Tuesday, the city of Fresno’s Mobilehome Park Rent Review and Stabilization Committee delayed for a week a request by Harmony to raise rents by $350 a month.
Roughly half of the residents remain, according to Mariah Thompson, a Fresno attorney representing a group of La Hacienda tenants.