BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 379|
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THIRD READING
Bill No: AB 379
Author: Brown (D)
Amended: 6/12/13 in Senate
Vote: 21
SENATE TRANSPORTATION & HOUSING COMMITTEE : 10-0, 6/4/13
AYES: DeSaulnier, Gaines, Beall, Cannella, Galgiani, Hueso,
Lara, Liu, Roth, Wyland
NO VOTE RECORDED: Pavley
ASSEMBLY FLOOR : 75-0, 4/11/13 (Consent) - See last page for
vote
SUBJECT : Manufactured housing: removal
SOURCE : California Manufactured Housing Institute
DIGEST : This bill changes the process whereby the law deems a
mobilehome a fixture or improvement to real property.
Senate Floor Amendments of 6/12/13 clarify that an enforcement
agency is to record a specified document with the county
recorder in the county where the mobilehome is located.
ANALYSIS : Under current law mobilehomes are either personal
property or real property. To be real property, someone must
affix the mobilehome to a piece of land. This occurs when a
mobilehome owner places the mobilehome on a permanent
foundation. Alternatively, an owner may install a mobilehome on
piers with tie-downs, and then the law considers the home
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personal property (or chattel) because it is not permanently
affixed to the underlying land.
The Mobilehome Parks Act (MPA) directs the Department of Housing
and Community Development (HCD) to regulate mobilehome parks to
assure protection of the health, safety, and general welfare of
all mobilehome park residents. HCD has adopted statewide
regulations to enforce the act's provisions. Local agencies,
however, have the option of assuming enforcement authority
within their jurisdictions through agreement with HCD. In
addition, the MPA requires HCD to establish regulations for
mobilehome foundations systems.
The MPA further specifies that installation of a mobilehome as a
fixture or improvement to a piece of real property must meet
these requirements:
1.The owner or contractor installing the home must get a
building permit from the local agency;
2.The enforcement agency (i.e., either HCD or the local agency)
must record with the county recorder a document stating that
someone has affixed the mobilehome to real property by
installing a foundation system. The enforcement agency must
record this document on the same day it issues the certificate
of occupancy; and
3.The owner must surrender to HCD the registration and title to
the mobilehome that HCD issues for mobilehomes that are
personal property.
This bill:
1.Provides that, notwithstanding any other law, a mobilehome is
not a fixture or improvement to real property until all of the
above bulleted steps are completed.
2.Gives the enforcement agency five days to record the document
showing that someone has affixed a mobilehome to real property
rather than requiring that it record the document the same day
it issues the certificate of occupancy.
3.Clarifies that an enforcement agency is to record a specified
document with the county recorder in the county where the
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mobilehome is located.
Comments
Health and Safety Code Section 18551 sets forth the procedures
under which a mobilehome may be installed on and become a
fixture to real property. These procedures are important both
for tax purposes for local government entities and for the
financing of mobilehomes. Because mobilehomes are deemed
personal property (or chattel) and not real property at the time
of purchase, buyers do not finance these homes with a mortgage
as they do with site-built homes. The law recognizes this and
allows companies that finance the purchase of mobilehomes to
maintain a security interest in a home until it is paid off.
Last year, the 1st District Court of Appeal in Vieira
Enterprises v. City of East Palo Alto found that a mobilehome
purchased and installed on real property was itself real
property. As a result of the ruling, the court held that the
financing company had no security interest in the mobilehome
because it was real property. This essentially allowed the
borrower to forgo paying the lender the balance owed on the
home.
In that case, the court held that because the owners had
installed their mobilehome on their real estate, Civil Code
provisions, which generally deem when a thing is affixed to the
land, controlled over Health and Safety Code Section 18551,
which specifically describes how a mobilehome may be deemed
affixed to the land. While the Vieira case had unique and
specific circumstances, the proponents of this bill are
concerned that that ruling could be read as allowing a borrower
to install a mobilehome on a foundation system and potentially
avoid the lender's security interest. That interpretation could
have a chilling effect on lenders' willingness to finance
mobilehome purchases in the future.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local:
No
SUPPORT : (Verified 6/5/13)
California Manufactured Housing Institute (source)
Western Manufactured Housing Communities Association
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ASSEMBLY FLOOR : 75-0, 4/11/13
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Bigelow, Bloom,
Blumenfield, Bocanegra, Bonilla, Bonta, Bradford, Brown,
Buchanan, Ian Calderon, Campos, Chau, Ch�vez, Chesbro, Conway,
Cooley, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox,
Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gordon, Gorell,
Gray, Grove, Hagman, Hall, Roger Hern�ndez, Holden, Jones,
Levine, Linder, Logue, Maienschein, Mansoor, Medina, Melendez,
Mitchell, Morrell, Mullin, Muratsuchi, Nazarian, Nestande,
Olsen, Pan, Perea, V. Manuel P�rez, Quirk, Quirk-Silva,
Rendon, Salas, Skinner,
Stone, Ting, Torres, Wagner, Waldron, Weber, Wieckowski, Wilk,
Williams, Yamada, John A. P�rez
NO VOTE RECORDED: Harkey, Jones-Sawyer, Lowenthal, Patterson,
Vacancy
JA:nl 6/5/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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