BILL ANALYSIS                                                                                                                                                                                                    




                     SENATE GOVERNANCE & FINANCE COMMITTEE
                            Senator Lois Wolk, Chair
          

          BILL NO:  AB 253                      HEARING:  6/19/13
          AUTHOR:  Levine                       FISCAL:  Yes 
          VERSION:  5/2/13                      TAX LEVY:  No
          CONSULTANT:  Lui                      

                              SUBDIVISION MAP ACT 
          

          Extends subdivision requirements to floating home marinas  
          that apply to the conversion of mobilehome parks.


                                    Background  

          During World War II, the Marinship shipyard in Sausalito  
          was built to construct "Liberty Ships" for the U.S. Navy.   
          After the war, the shipyard was decommissioned, and  
          military vessels, like landing crafts, were abandoned.  In  
          the 1950s and 1960s, individuals began living in and around  
          the former shipyard in Richardson's Bay (Marin County).   
          Many former barges, tugboats, and ferries have been  
          converted to residences.  Today, most of these houseboats  
          resemble traditional single-family homes.  

          State law defines a floating home as a stationary structure  
          that has no mode of power on its own, is dependent on  
          utilities, and has a permanent continuous hookup to  
          shoreside sewage.  They are subject to the property tax (AB  
          2409, Filante, 1985).  Floating home marinas are generally  
          privately owned and charge homeowners monthly berthage  
          fees.  Approximately 500 home berths are permitted in six  
          designated residential marinas -- five in Marin County, and  
          one in Alameda County. 

          In response to haphazard and uncoordinated filling of San  
          Francisco Bay, the Legislature enacted the McAteer-Petris  
          Act of 1965, which created the San Francisco Bay  
          Conservation and Development Commission (SB 309, McAteer).  
          Floating homes in the San Francisco Bay must comply with  
          the San Francisco Bay Plan, which limits the construction  
          and modification of floating homes.  Floating homes must  
          also comply with local regulations regarding design,  
          safety, and location.





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          Owners of floating homes generally stay in the same place  
          for decades, affixed to a berth, and have created  
          communities and associations for governance.  Currently,  
          marina residents can form cooperatives or condominiums to  
          purchase a marina, and state law provides a process for  
          marina residents to notify a marina owner of their intent  
          to purchase the marina (AB 929, Filante, 1990).  Last year,  
          at the request of residents of floating home marinas, the  
          Legislature deemed transfers of a floating home marina to  
          an entity formed by tenants purchasing the marina not be a  
          change of ownership for property tax purposes (AB 2046,  
          Allen, 2012).  Residents of floating home marinas are  
          asking lawmakers for similar protections as those granted  
          to mobile home park residents when parks are converted to  
          resident ownership.


                                   Proposed Law  

          Assembly Bill 253 extends to floating home marinas several  
          requirements that apply to the conversion of mobilehome  
          parks.

          I.   Public report  .  Current law requires that anyone who  
          plans to sell subdivided lands must file with the  
          Department of Real Estate an application for a public  
          report, which includes a description of the land,  
          provisions made for public utilities, any liens, and an  
          estimate of existing or proposed assessment.  The purchase  
          of a mobilehome park by a nonprofit corporation is exempt  
          from the requirement to file an application for a public  
          report if it purchases a mobilehome park, if all of the  
          following occur:
                 A majority of the shareholders or members of the  
               nonprofit corporation constitute a majority of the  
               homeowners of the mobilehome park, and a majority of  
               the nonprofit corporations' board directors are  
               homeowners of the mobilehome park.
                 All members of the corporation are residents of the  
               mobilehome park.
                 A permit to issue securities is obtained from the  
               Department of Corporations. 
                 All tenants' funds for the purchase of the  
               mobilehome park are deposited in escrow until the  
               document transferring title of the mobilehome park to  
               the nonprofit corporation is recorded.  





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          Assembly Bill 253 exempts a floating home marina from the  
          requirement for a public report, under the same specified  
          conditions.  

          II.   Written notice and disclosure  .  Current law requires a  
          subdivider of a mobilehome park that is proposed to be  
          converted to resident ownership, prior to filing a notice  
          of intention, to disclose to homeowners and park residents,  
          by written notice, the tentative price of the subdivided  
          interest proposed to be sold.  The disclosure notice must  
          include a statement that the tentative price is  
          non-binding, and the provider of the information is not  
          liable.  The notice must not be construed to authorize the  
          subdivider of a mobilehome park to offer to sell or lease  
          or accept money for the sale or lease of subdivided  
          interests in the park, or to engage in other prohibited  
          activities, with regard to subdividing the park into  
          ownership interests, before to the issuance of a public  
          report. 

          Assembly Bill 253 requires a subdivider of a floating home  
          marina, before filing a notice of intention, to disclose to  
          specified information in writing to homeowners and  
          residents of the marina. 
           
           III.   Report on the impact of the conversion  .  Current law  
          requires a subdivider, when filing a tentative or parcel  
          map for a subdivision that converts a mobilehome park to  
          another use, to file a report on the impact of the  
          conversion on displaced residents of the mobilehome park.   
          The report must address the availability of adequate  
          replacement space in mobilehome parks.  The subdivider must  
          make a copy of the report available to each mobilehome park  
          resident at least 15 days before an advisory agency or  
          legislative body hears the map.  The legislative body that  
          is authorized to approve, conditionally approve, or  
          disapprove the map, can require the subdivider to take any  
          steps to mitigate any adverse impact of the conversion.   
          Any local agency may enact more stringent measures  
          regarding local regulation of conversions of mobilehome  
          parks.  A subdivision that is created from the conversion  
          of rental to resident ownership is not required to file a  
          report on the impact of the conversion on displaced  
          residents of the mobilehome park.






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          Assembly Bill 253 requires a subdivider, at the time of  
          filing a tentative or parcel map for a subdivision that  
          converts a floating home marina to another use, to file a  
          report, as specified, on the impact of the conversion on  
          displaced residents of the floating home marina, subject to  
          the same conditions that apply to mobilehome parks. 

          IV.   Conversion of rental to resident ownership  .  Current  
          law requires a subdivider, when filing a tentative or  
          parcel map for a subdivision to be created from the  
          conversion of a rental mobilehome park to resident  
          ownership, to avoid the economic displacement of all  
          nonpurchasing residents in a specified manner.  

          Assembly Bill 253 extends the same requirements to the  
          conversion of a rental floating home marina to resident  
          ownership.

          V.   Petition  .  Current law waives the requirement for a  
          parcel map or a tentative and final map when at least  
          two-thirds of the mobilehome owners, who are tenants in the  
          mobilehome park, sign a petition indicating their intent to  
          purchase the park for conversion to resident ownership, and  
          a field survey is performed, except if any of the four  
          specified conditions exist.  

          Assembly Bill 253 waives the requirement for a parcel map  
          or a tentative and final map, when at least two-thirds of  
          the owners of floating homes who are tenants in the  
          floating home marina sign a petition indicating their  
          intent to purchase the marina to convert it to resident  
          ownership, and if other conditions are met.  The bill also  
          specifies the form and content of the floating home marina  
          petition and disclosure statement. 

          Current law prohibits a local agency, if a tentative or  
          parcel map is required, from imposing any offsite design or  
          improvement requirements unless they are necessary to  
          mitigate an existing health or safety condition.  The  
          mitigation of a health or safety concern must not reduce  
          the number or change the location of mobilehome spaces.   
          Assembly Bill 253 provides that the mitigation must also  
          not reduce the number or change the location of floating  
          home marina berths. 







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                               State Revenue Impact
           
          No estimate. 


                                     Comments  

          1.   Purpose of the bill  .   The Subdivision Map Act allows  
          mobile home tenants to purchase their park and distribute  
          the ownership through a common interest development, like a  
          condominium, where individual owners use common property  
          and facilities, and are governed through a homeowners  
          association.  If residents are interested in purchasing the  
          floating home marina, they have two options: a condominium  
          or a cooperative.  In a common interest development, a  
          resident would own the floating home's berth, whereas in a  
          cooperative, a resident buys a share of the marina.   
          Although existing law authorizes the formation of a  
          cooperative or condominium, AB 253 facilitates the creation  
          of a condominium association, in the event that tenants  
          want to purchase their marina as a group.  Further, the  
          floating home resident group may face difficulty in  
          securing a loan and insurance, because financing a home  
          marina is rare and a cooperative is a relatively uncommon  
          form of ownership.  According to the author, the bill  
          "removes a significant financial barrier and will benefit  
          marina owners by providing them with a buyer with an  
          interest in the marina."  AB 253 extends to floating home  
          marinas the same statutory provisions that allow mobilehome  
          parks to convert to residential ownership.

          2.   Mandate  .  The California Constitution requires the  
          State to reimburse local governments' costs for a new or  
          higher level of service.  Legislative Counsel says that AB  
          253 creates a new state mandated local program by  
          increasing the level of service provided by local agencies.  
           AB 253 declares that no reimbursement is necessary because  
          a local agency can levy service charges, fees, or  
          assessments to offset the costs of the bill's requirements.  
            
           
           3.   Technical  .  AB 253 conflicts with AB 1317 (Frazier),  
          which enacts conforming statutory and name changes to  
          reflect the Governor's Reorganization Proposal Number 2  
          (2012).  Effective July 1, 2013, the Department of  
          Corporations will become a division in the new Department  





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          of Business Oversight.  The Committee may wish to consider  
          amending the bill to conform to the name changes set forth  
          in GRP 2:
                 On page 4, line 16, after "of" insert "Business  
               Oversight, Division of"


                                 Assembly Actions  

          Assembly Local Government:              9-0
          Assembly Housing and Community Development:7-0
          Assembly Appropriations:                          17-0
          Assembly Floor:                                   74-0


                         Support and Opposition  (6/13/13)

           Support  :  Sausalito Floating Homes Association; Supervisor  
          Kathrin Sears, Marin County.

           Opposition  :  Unknown.