BILL ANALYSIS Ó
AB 317
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Date of Hearing: January 11, 2012
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Norma Torres, Chair
AB 317 (Calderon) - As Amended: January 9, 2012
SUBJECT : Mobilehomes.
SUMMARY : Exempts any mobilehome that is not the sole residence
of the homeowner from rent control. Specifically, this bill :
1)Exempts a mobilehome space within a mobilehome park that is
not the sole residence of the mobhilehome owner from any
ordinance, rule, regulation, or initiative measure adopted by
any city, county, or city and county that establishes a
maximum amount that the landlord may charge a tenant for rent.
2)Specifies that evidence that a mobilehome is not the sole
residence of the mobilehome owner must be weighted in light of
the totality of the circumstances and may include, but is not
limited to, the following factors:
a) The mobilehome owner rents, leases, occupies, or has a
present ownership interest in another place of residence,
other than an ownership interest in a place of residence
solely and exclusively occupied by the mobilehome owner's
child or parent and his or her immediate family.
b) Another place of residence appears as a matter of public
record or in other evidence obtained by management;
c) Monthly statements are mailed to, or payments are made
from, a different place of residence;
d) The mobilehome owner is regularly absent from the
mobilehome for extended periods of time, other than for
military service, hospitalization, vacation, family or
friend emergency care, or other reasonable temporary or
seasonal periods of absence, such as travel necessitated by
employment or education;
e) The mobilehome is used primarily for vacationing,
storage, or business;
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f) The mobilehome has been subleased or possession of the
mobilehome has been transferred without management's
approval; and
g) A review of state or county records demonstrates that
the homeowner is receiving a homeowner's exemption for
another property or mobilehome.
3)Requires any disputes related to whether or not a mobilehome
is the sole residence of the mobilhome owner to be arbitrated,
with the cost of the arbitration paid by the owner or
management of the mobilehome park.
4)Requires the parties to meet and confer to select a mutually
agreeable arbitrator.
5)Specifies that if the parties cannot agree to an arbitrator
within 10 days after the homeowner's written response is
received, the management must obtain a list of five
arbitrators from any bona fide dispute resolution provider
serving the judicial district in which the mobilehome park is
located.
6)Allows each party to disqualify up to two arbitrators from the
list and allows any remaining arbitrator to be selected.
7)Requires the arbitrator to hear the evidence relevant to the
dispute within 30 days after selection, at a time and place
reasonably convenient to the parties.
8)Specifies that no attorney may represent either party at an
arbitration hearing.
9)Requires the arbitrator to render a written decision within 15
days of hearing the evidence as to whether the mobilehome is
the sole residence of the mobilehome owner.
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10)Specifies that the decision of the arbitrator is final.
11)Specifies that the exemption from rent control does not apply
under any of the following circumstances:
a) The mobilehome is the sole residence of the mobilehome
owner, which is defined as a person who has a full-time
tenancy in a mobilehome park under a rental agreement, a
senior who is a full-time resident of a mobilehome owned by
a child of the senior, or a child with a disability or
handicap who is a full-time resident of a mobilehome owned
by a parent or guardian of the child.
b) The space is subleased by the owner for a medical
hardship;
c) Ownership of the mobilehome is transferred to an heir,
joint tenant, or personal representative upon the death of
mobilehome owner;
d) Management elects to apply an exemption or right set
forth in the ordinance, rule, regulation, or initiative
measure that establishes a maximum amount that a landlord
may charge a tenant for rent; and
e) The mobilehome is actively being held available for sale
by the homeowner and the home remains vacant and
unoccupied. If the home remains occupied, provides 120 days
from the time management provides notice of a rent increase
based on a finding that the home is not the sole residence
of the mobilehome owner for the space to remain under rent
control while being actively held available for sale.
12)Provides that if management authorizes the subleasing of
mobilehomes in the park, management shall not restrict the
amount of rent that the mobilehome owner may charge for rent
in a sublease situation.
13)Provides that sublet mobilehomes are exempt from rent
control, except when subleased for a medical hardship.
14)Specifies that upon reoccupation of the space by the
mobilehome owner after the term of the sublease has expired,
the last rental rate charged to the mobilehome owner shall be
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the base rental rate for purposes of rent control, plus any
increases that were allowed during the term of the sublease.
15)Deletes the following exemptions to the current law that
exempts mobilehome spaces that are not the principal residence
of the homeowner from rent control:
a) The homeowner is unable to rent or lease the mobilehome
because the park prohibits subletting; and
b) The legal owner has taken possession or ownership, or
both, of the mobilehome from a registered owner through
either a surrender of ownership interest by the registered
owner or a foreclosure proceeding.
16)Adds language to an existing disclosure form that the
management of a mobilehome park must provide to prospective
homeowners stating that purchasers who do not occupy the
mobilehome as their sole residence may be subject to rent
levels that are not governed by rent control.
EXISTING LAW
1)Exempts any mobilehome that is not the principal residence of
the homeowner and that has not been rented to another party
from rent control (Civil Code Section 798.21).
2)Specifies that a mobilehome is considered the homeowners
principal residence unless the homeowner is receiving a
homeowner's exemption for another property or mobilehome in
California, or unless a review of public records reasonably
demonstrates that the principal residence of the homeowner is
out of state (Civil Code Section 798.21).
3)Requires the management to notify the homeowner in writing of
any proposed change in rent before modifying the rent or other
terms of tenancy based on evidence that the mobilehome is not
the homeowner's principal residence, and requires the
management to provide the copy of the documents upon which
management relied (Civil Code Section 798.21).
4)Specifies that homeowners are not required to disclose
information concerning their personal finances and management
is not authorized to gain access to any records which would
otherwise be confidential or privileged (Civil Code Section
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798.21).
5)Gives homeowners 90 days from the date they receive notice
from the management of a proposed change in rent to respond
(Civil Code Section 798.21).
6)Prohibits management from modifying the rent or other terms of
tenancy prior to the expiration of the 90-day period or prior
to responding, in writing, to information provided by the
homeowner (Civil Code Section 798.21).
7)Prohibits management from modifying the rent or other terms of
tenancy if the homeowner provides documentation reasonably
establishing that the information provided by management is
incorrect or that the homeowner is not the same person
identified in the documents (Civil Code Section 798.21).
8)Prohibits a homeowner from changing the homeowner's exemption
status of the other property or mobilehome owned by the
homeowner after receiving the notice from the management
(Civil Code Section 798.21).
9)Specifies that the exemption from rent control does not apply
under any of the following conditions:
a) The homeowner is unable to rent or lease the mobilehome
because the owner or management of the mobilehome park does
not permit subleasing;
b) The mobilehome is being actively held available for
sale; or
c) The legal owner has taken possession or ownership, or
both, of the mobilehome from a registered owner through
either a surrender of ownership interest by the registered
owner or a foreclosure proceeding.
(Civil Code Section 798.21)
10)Requires management to permit a homeowner to rent his or her
mobilehome or sublet his or her space if a medical emergency
or medical treatment requires the homeowner to be absent from
his or her home and this is confirmed in writing by an
attending physician. In such cases, the homeowner is
prohibited from charging a renter or sublessee more than an
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amount necessary to cover the cost of space rent, utilities,
and scheduled loan payments on the mobilehome, if any. (Civil
Code Section 798.23.5)
FISCAL EFFECT : None
COMMENTS :
Background : Birkenfeld v. Berkeley (1976) 17 Cal. 3d 129,
provides that cities and counties have within their policy and
regulation powers the authority to enact rent control laws so
long as a fair return is assured to property owners.
Approximately 111 local jurisdictions have enacted measures
limiting the amount of rent or establishing a maximum amount of
rent that the management of a mobilehome park may charge a
tenant for rent of a lot space. Under existing law, local
governmental entities are free to enact rent control laws
regarding mobilehome parks. These local laws are not subject to
the state's Costa-Hawkins Act restricting permissible rent
control ordinances, but in certain limited circumstances the
Mobilehome Residency Law (MRL) exempts certain mobilehome park
spaces from local rent control. Under existing law rental
agreements which are twelve months or longer are exempt from
local rent control.
SB 1181 (Haynes), Chapter 392, Statutes of 1996, created an
exemption to rent control for mobilehomes that are not the
principal residence of the homeowner and established that a
mobilehome is deemed the principal residence of the homeowner
unless the owner claims the homeowner's exemption on another
residence in California or unless records show that the owner's
principal residence is out of state. At the time, the sponsor of
the bill, the Mobilehome Park Alliance (MPA), stated that as
many as 20% of the mobilehomes in luxury parks in communities
such as Malibu, Palm Springs, Santa Barbara County, Palm Desert,
and Escondido are used as vacation homes and remain vacant for
significant periods of the year while their owners are living
elsewhere. MPA argued that vacation homes should not be eligible
for rent control.
Purpose of the bill: AB 317 exempts any home that is not the
sole residence of the homeowner from rent control. The bill
contains a non-exclusive list of factors that could be used to
determine that a home is not the sole residence of the owner.
The bill requires arbitration, paid for by the park owner or
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management, if the homeowner disputes a finding that the home is
not their sole residence. The arbitrator must be mutually agreed
upon by both parties and the decision of the arbitrator is
final.
The bill additionally provides that subleased mobilehomes,
except those subleased in the event of a medical hardship, are
exempt from rent control. If a mobilehome owner reoccupies
their home after a sublease, the bill requires that their base
rent for purposes of rent control be set out their pre-sublease
rent plus any increases that were permitted during the term of
the sublease.
Finally, AB 317 adds language to an existing disclosure form
that the management of a mobilehome park must provide to
prospective homeowners stating that purchasers who do not occupy
the mobilehome as their sole residence may be subject to rent
levels that are not governed by rent control.
According to the sponsor, the Western Manufactured Housing
Communities Association, the homeowner's exemption test has
proved to be an inadequate way of determining whether a
mobilehome is a vacation home. Because the financial benefits of
rent control can be substantial and the value of the homeowner's
exemption is the same no matter what property an owner claims it
on, those who own mobilehomes as vacation properties have a
strong incentive to claim the exemption on the mobilehome rather
than on their true primary residence. While property tax law
requires that the homeowner's be claimed only on a primary
residence, there is no way for county assessors to determine
that a homeowner has instead claimed it on a vacation property.
As long as a homeowner is only claiming the exemption on one
residence, there is no reason why an assessor would question
where someone is claiming the exemption.
WMA additionally states that currently, most mobilehome parks do
not allow subleasing. They state that one reason for this is
that some homeowners have taken advantage of park owners by
purchasing multiple homes in rent-controlled communities and
creating a business of subletting out the homes at rents greater
than what the park owner is permitted to charge.
Arguments in Support: WMA argues that the original intent of
rent control was to preserve a source of affordable housing and
protect residents who are captive in the community because they
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can't move their home from large rent increases, not to make it
affordable for someone to own a second home. WMA believes that
current law is inadequate because it is easy for owners to claim
that a mobilehome is their primary residence even when it is
not, and further believes that the laws needs to be expanded to
prohibit rent control on any second home. WMA argues that those
who can afford to own two homes should not benefit from rent
control. They additionally argue that it is unfair for
homeowners to profit off of rent control in a sublease situation
and believe that if sublet mobilehomes were no longer subject to
rent control, more parks would allow subletting, providing
homeowners with more options.
Arguments in Opposition : The Golden State Manufactured-Home
Owners League (GSMOL) believes that the current requirements for
determining whether a homeowner is entitled to a rent-stabilized
space are fair and adequate. They argue that the list of factors
that could be used to establish that a home is not the owner's
sole residence is so vague and overbroad that man innocent
activities of homeowners will be used as a basis for declaring a
residence to be a second home, thus ending rent control
protections and allowing park owners to increase space rent by
any amount desired. GSMOL further argues that very few
mobilehome parks allow subleasing, including the vast majority
of parks in jurisdictions without rent control and questions the
argument that removing sublet mobilehomes from rent control will
encourage subleasing.
REGISTERED SUPPORT / OPPOSITION :
Support
Western Manufactured Housing Communities Association
Opposition
Golden State Manufactured Homeowners League
Western Center on Law and Poverty
Analysis Prepared by : Anya Lawler / H. & C.D. / (916)
319-2085
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