BILL ANALYSIS �
AB 692
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Date of Hearing: May 15, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 692 (Torres) - As Amended: April 29, 2013
Policy Committee: Housing and
Community Development Vote: 5-2
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill expands the existing Mobilehome Park Resident
Ownership Program (MPROP) to allow loans for the purchase and
rehabilitation of a mobilehome park without converting the park
ownership. Specifically, this bill:
1)Allows the Department of Housing and Community Development
(HCD) to make loans under MPROP to a qualified nonprofit
housing sponsor or a local government entity to purchase and
rehabilitate a mobilehome park without converting the park to
resident ownership for the purpose of bringing the park into
compliance with all applicable health and safety standards and
maintaining affordable rents for low-income residents.
2)Requires HCD to take into consideration specified factors in
determining eligibility and price regarding park purchase and
rehabilitation loans.
3)Requires HCD to verify that either no park residents will be
displaced as a result of the park purchase, or the impacts of
the displacement will be mitigated as required under state and
local law. Requires HCD to approve the budget and plan for
the operation of the park.
FISCAL EFFECT
Negligible fiscal impact.
COMMENTS
1)Purpose. According to the author, there are many mobilehome
AB 692
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parks in the state, primarily serving low-income residents,
which have persistent issues with substandard infrastructure
and a long history of health and safety code violations.
Currently, the only way to use MPROP funds to rehabilitate
these parks to improve the living conditions is to also
convert the park to resident ownership. However, the author
states, complexity and cost of the conversion step can render
the project infeasible and there may not be support among
residents for converting because the residents are not in a
financial position to purchase their individual lots. The
author argues in these cases, MPROP can provide the funds
necessary to get the park into the hands of an operator who
will rehabilitate and maintain it while keeping rents
affordable to low-income residents.
2)Background . MPROP was created in 1984 to provide low-interest
loans to finance the conversion of mobilehome parks to
resident ownership. The program is funded through a $5 fee
that certain mobilehome owners pay along with their annual
registration fee, as well as through loan repayment. There is
currently $14 million available under MPROP. Between 1985 and
2001, MPROP provided loans to assist with conversion in 66
mobilehome parks around the state. Since 2002, new loan
activity under the program has slowed. The program had no
successful applications in 2010 and only two in 2011. HCD
indicates that the increasing cost and complexity of park
conversions are two of the primary reasons for the reduction
in the number of loan applications.
3)There is no registered opposition to this bill.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081