BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 1047
                                                                  Page  1

          Date of Hearing:   June 30, 2010

               ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
                                 Norma Torres, Chair
                     SB 1047 (Correa) - As Amended:  May 12, 2010

           SENATE VOTE  :   33-0
           
          SUBJECT  :   Mobilehomes: nonprofit resident-owned mobilehome  
          park.

           SUMMARY  :   Clarifies that the tenant provisions of the  
          Mobilehome Residency Law (MRL) apply in nonprofit resident-owned  
          mobilehome parks to members of the nonprofit mutual benefit  
          corporation that lease a space in the park.

           EXISTING LAW  , the MRL:

          1)Extensively regulates the rights, responsibilities,  
            obligations, and relationships between mobilehome park owners  
            and residents.  Articles 1-8 deal with legal rights and  
            remedies related to the leasing of space by tenants; Article 9  
            contains provisions that apply to resident-owned parks.   
            (Civil Code Section 799 et seq.)

          2)Provides that in a subdivision, cooperative, or condominium  
            for mobilehomes, or a resident-owned mobilehome park Articles  
            1-8 of the MRL apply only to residents who do not have an  
            ownership interest in the subdivision, cooperative, or  
            condominium for mobilehomes, or a resident-owned mobilehome  
            park (Civil Code Section 799.1).

          3)Provides that Article 9 governs residents who do have an  
            ownership interest in the subdivision, cooperative, or  
            condominium for mobilehomes, or resident-owned mobilehome park  
            (Civil Code Section 799.1). 

           FISCAL EFFECT  :   None

           COMMENTS  :   

          Enacted in 1978, the MRL governs the relationship between park  
          owners or managers and the residents of the 4,800-plus  
          mobilehome parks and manufactured housing communities in  
          California.  In most of those parks, residents own their home  








                                                                  SB 1047
                                                                  Page  2

          but lease the land on which their home is installed.  

          Over the past 20 years, residents have been increasingly  
          interested in various ways to purchase their parks and the  
          spaces upon which their homes are installed.  One method of  
          purchasing a park-the nonprofit mutual benefit corporation-is  
          described by the Department of Real Estate as follows:

            Park residents need a legal entity to purchase their park.  A  
            nonprofit mutual benefit corporation is well suited to this  
            purpose.  In general, the nonprofit corporation makes an offer  
            of participation to the residents.  Residents who decided to  
            participate become shareholders or members of the corporation.  
             As residents purchase shares or memberships in the  
            corporation, cash is accumulated for the down payment required  
            to purchase the park.  The officers of the corporation,  
            elected by the members and acting on their behalf, negotiate  
            with the seller to purchase the park and solve problems  
            relating to conversion.  After conversion, the corporation may  
            manage the park.

          To deal with the various facets of mobilehome parks and  
          manufactured housing communities, the MRL is divided into nine  
          different Articles.  Articles 1-8 of the MRL deal with legal  
          rights and remedies for mobilehome parks that rent space to  
          residents.  Article 9 of the MRL generally deals with the legal  
          rights and remedies of resident-owned mobilehome parks.  Under  
          existing law, residents who have shares in a nonprofit mutual  
          benefit corporation but lease their space from that corporation  
          fall under Article 9 but not Articles 1-8.

          According to the author, "The present law treats ? members of a  
          mutual benefit non-profit corporation as if they actually own  
          the space in which their home is sited and treats them as if the  
          typical CC&R [Covenants, Conditions, and Restrictions]  
          provisions apply and provide governance as to their actions in  
          such a park.  No such CC&R provisions exist and the persons who  
          are members lease the home site from the Corporation in which  
          they are members and as such these members have neither the  
          protection of the Civil Code sections set forth in [Civil Code  
          Section 798] or the typical CC&R provisions.  The Corporation  
          also has no viable method to enforce the members' obligations  
          outside the leases which often refer to [Civil Code Section] 798  
          which per [Civil Code Section 799] cannot apply and cannot be  
          used to enforce the Park leases or Rules and Regulations."








                                                                  SB 1047
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          SB 1047 provides, with specified exceptions, that in a  
          mobilehome park owned and operated by a nonprofit mutual benefit  
          corporation whose members consist of park residents where there  
          is no recorded condominium plan, tract, parcel map, or  
          declaration, Article 1 (commencing with Civil Code Section 798)  
          through Article 8 (commencing with Civil Code Section 798.84)  
          shall govern the rights of members who are residents that have a  
          rental agreement with the corporation.

           REGISTERED SUPPORT / OPPOSITION  :

           Support 
           
          None on file
           
            Opposition 
           
          None on file

           Analysis Prepared by  :    Anya Lawler / H. & C.D. / (916)  
          319-2085