BILL ANALYSIS Ó
AB 999
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Date of Hearing: April 29, 2015
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Ed Chau, Chair
AB 999
(Daly) - As Amended April 20, 2015
SUBJECT: Abandoned mobilehomes: disposal
SUMMARY: Establishes due process requirements for mobilehome
park owners (park management) seeking to dispose of an abandoned
mobilehome without first being required to pay any unpaid
property taxes on the mobilehome. Specifically, in order for
park management to dispose of an abandoned mobile home, this
bill:
1)Requires park management to file a petition for judicial
declaration of abandonment and in the petition, declare its
intent to not seek a tax clearance certificate, and then
notify the county tax collector and the Department of Housing
and Community Development (HCD) by mailing a copy of the
petition by first-class mail.
2)Requires park management, within ten days following a judgment
of abandonment, to enter the mobilehome, make an inventory of
the contents, and submit the inventory to the court.
3)Requires park management to post and mail a notice of intent
to dispose of the abandoned mobilehome and its contents under
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this section, and announcing the date of disposal, in a
specified manner. Further requires the management to provide
notice to the county tax collector and HCD.
4)Authorizes park management to dispose of the abandoned
mobilehome following a judgment of abandonment, but not less
than ten days following the above notice of intent to dispose.
5)Defines "dispose" to mean the removal and destruction of an
abandoned mobilehome from a mobilehome park, thus making it
unusable for any purpose.
6)Authorizes any person having right to possession of the
abandoned mobilehome to recover and remove it from the
premises at any time prior to disposal upon payment to the
management of all rent or other charges due, including
reasonable costs of storage and other costs awarded by the
court. Requires the management to immediately file an
acknowledgment of satisfaction of judgment upon receipt of
such payment and removal of the mobilehome.
7)Requires park management, within 30 days of the date of the
disposal of an abandoned mobilehome and its contents, to
submit to the court, the county tax collector, and HCD a
statement that the abandoned mobilehome and its contents were
disposed of, with supporting documentation. Alternatively, if
the contents of the mobilehome were sold at a public sale
instead of being disposed of along with the mobilehome, then
management shall also submit an accounting of the moneys
received from the sale and the disposition of the money and
the items contained in the inventory.
8)Provides that, notwithstanding any other law, park management
shall not be required to obtain a tax clearance certificate,
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as set forth in Section 5832 of the Revenue and Taxation Code,
to either dispose of an abandoned mobilehome and sell its
contents, or dispose of an abandoned mobilehome and its
contents.
EXISTING LAW:
1)Defines "abandoned mobilehome" to mean a mobilehome that is
unoccupied, is located in a mobilehome park on a site for
which no rent has not been paid to the management for the
preceding 60 days, and is in such condition that a reasonable
person would believe it to be abandoned.
2)Establishes a specified procedure for determining the
abandonment of a mobilehome, which includes posting a notice
of belief of abandonment on the mobilehome for a minimum of 30
days and mailing copies of the notice to the homeowner and any
known holder of a security interest in the mobilehome.
3)Establishes a court-supervised process to petition for a
judicial declaration of abandonment, which includes serving
the petition upon the homeowner and known lienholders in a
manner specified.
4)Provides for a hearing whereby a court may enter a judgment of
abandonment in favor of the petitioner, and allow him or her
to recover various costs and charges, plus attorney's fees,
against the owner of the mobilehome.
5)Establishes due process requirements for park management
seeking to sell an abandoned mobilehome and/or its contents,
including various notice provisions, a public sale
requirement, and specifying the division of proceeds from the
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sale.
6)Requires management to provide the purchaser of the mobilehome
at the public sale with a copy of the judgment of abandonment
and evidence of the sale, and requires either HCD or the
Department of Motor Vehicles to subsequently register title of
the abandoned mobilehome in the name of the purchaser upon
presentation thereof. Further provides that the sale shall
pass title to the purchaser free of any prior interest,
including any security interest or lien, except as specified
(Civil Code Section 798.61).
7)Provides that property taxes due on mobilehomes are entered on
the secured roll for collection, but if they go unpaid and
become delinquent, shall be transferred from the secured roll
to the unsecured roll. Further provides that unpaid property
tax amounts transferred to the unsecured roll continue to be
subject to delinquent penalties until the amounts are paid,
and are collectible from either the person from whom the
property was acquired or the public entity that acquired the
property (Revenue and Taxation Code Section 2921.5).
FISCAL EFFECT: Unknown.
COMMENTS:
Background: Under existing law, owners of mobilehome parks must
follow a specified court-supervised abandonment proceeding to
dispose of a mobilehome when the homeowner has not only stopped
paying rent on the site, but apparently abandoned the mobilehome
itself, leaving it unoccupied and in a condition rendering it
uninhabitable and unattractive for resale. In many cases, the
property is burdened with unpaid property taxes owed by the
homeowner-taxes which create an obstacle to disposal and removal
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of the home by park management because current law requires the
unpaid taxes to be paid off before title to the mobilehome can
be transferred to the park management, even for the purpose of
disposal.
Need for this bill: This bill, sponsored by the Western
Manufactured Housing Communities Association (WMA), seeks to
establish procedures for mobilehome park owners that if
satisfied, would allow them to dispose of an abandoned
mobilehome without first being required to pay the unpaid
property taxes on the home. In justifying the need for the
bill, the author states:
"Manufactured homes and mobilehomes are regularly abandoned in
mobilehome communities. Disposal of an abandoned mobilehome
entails the filing of a petition in court by a landlord in
order to establish a lien and seize ownership of the property
(Civil Codes § 798.56a and 798.61). However, before a
landlord can complete the lien, he or she must pay any past
due personal property taxes owed by the mobilehome's previous
owner.
"With abandoned mobilehomes, frequently the registered owner
has failed to pay the required personal property taxes for an
extended period of time. Normally when an owner is
delinquent, the respective county tax collector would place a
lien on the mobilehome and sell it. However, tax collectors
are reluctant to pursue this course of action when a
mobilehome lacks value, as is the case with many abandoned
properties.
"Abandoned mobilehomes negatively impact the community, the
landlord, and tax collectors. They are unsightly and
potentially hazardous, thus depreciating the value of nearby
mobilehomes and impacting the health of residents. Landlords
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cannot rent out the space occupied by an abandoned mobilehome,
thus decreasing revenue and also precluding the collection of
taxes.
"This bill (AB 999) will help expedite the removal of
abandoned mobilehomes by allowing a landlord to dispose of the
property without the unjust burden of paying the delinquent
resident's taxes. Importantly, AB 999 ensures that the
registered owner remains responsible for the personal property
taxes, thus avoiding tax abatement."
Definitions of "abandoned" and "disposal": Under existing law,
an abandoned mobilehome means a mobilehome about which all of
the following are true: (1) it is unoccupied; (2) it is located
in a mobilehome park on a site for which no rent has been paid
to the management for the preceding 60 days; and (3) a
reasonable person would believe it to be abandoned. Existing
law also provides that if all three of these conditions are
true, then a mobilehome "that is uninhabitable because of its
total or partial destruction that cannot be rehabilitated" shall
also be included in the definition of "abandoned mobilehome."
Under this provision, even homes that have been completely
destroyed may not be deemed abandoned under the statute unless
all three criteria are met, including nonpayment of rent on the
site for 60 days.
This bill does not modify the definition of "abandoned
mobilehome," but it does define "disposal," specifically that to
dispose of an abandoned mobilehome means "the removal and
destruction of an abandoned mobilehome from a mobilehome park,
thus making it unusable for any purpose." Under this
definition, a park owner using the procedure authorized by this
bill to dispose of an abandoned mobilehome must destroy it upon
removal from the park, and may not use the home for any other
purpose, including salvage or resale to others.
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Disposal procedures for abandoned mobilehomes: This bill
establishes due process procedures for the disposal of abandoned
mobilehomes and their contents-provisions that largely track
those currently governing the sale of abandoned mobilehomes. As
a prerequisite, the management must first post a notice of
belief of abandonment on the mobilehome for a minimum of 30 days
and mail copies of the notice to the homeowner and any known
lienholders. Existing law requires the management to file a
petition for judicial declaration of abandonment and serve it
upon the homeowner, as well as any known lienholders on the
home. Because the bill seeks to relieve park management from
clearing unpaid taxes on the home, the bill requires management
to declare its intent in the petition to not seek a tax
clearance certificate, and then requires notification to the
county tax collector and HCD by mailing first-class a copy of
the petition. If at the hearing on the petition, the petitioner
shows sufficient evidence that the criteria for abandonment are
satisfied and no party establishes a right to possession or
security or ownership interest in the mobilehome, then the court
shall enter a judgment of abandonment.
At this point, the bill requires park management, within ten
days following the judgment of abandonment, to enter the
mobilehome, inventory the contents, and submit the inventory to
the court. Subsequently, management shall post and mail to the
homeowner and any known lienholders a notice of intent to
dispose of the abandoned mobilehome and its contents, including
the planned date of disposal. The notice must also be provided
to the county tax collector and HCD. The bill authorizes park
management to dispose of the abandoned mobilehome and its
contents following a judgment of abandonment, but not less than
ten days following the notice of intent to dispose. Finally,
within 30 days of the date of the disposal, the bill requires
management to submit to the court, the county tax collector, and
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HCD a statement that the abandoned mobilehome and its contents
were disposed, with supporting documentation. Alternatively, if
management elected to sell the contents of the mobilehome at a
public sale instead of disposing of them along with the
mobilehome, then the bill requires management to also submit an
accounting of the moneys received from the sale and the
disposition of the money and the items contained in the
inventory.
Liability for unpaid taxes follows the registered former owner
of the abandoned mobilehome: According to the author, this bill
does not result in any tax abatement because under existing law,
the registered owner of the home ultimately remains responsible
for unpaid taxes after those taxes are transferred from the
secured roll to the unsecured roll for tax collection. Section
2921.5 of the Revenue and Taxation Code provides that property
taxes due on mobilehomes are entered on the secured roll for
collection, but if they go unpaid and become delinquent, are
transferred to the unsecured roll. The law also provides that
unpaid property tax amounts transferred to the unsecured roll
continue to be subject to delinquent penalties until the amounts
are paid, and are collectible from either the person from whom
the property was acquired or the public entity that acquired the
property.
This bill simply allows mobilehome park owners to dispose of
abandoned mobilehomes without being required to pay a
homeowner's unpaid property taxes, as long as specified due
process procedures are satisfied. Because the bill does not
change procedures for the sale of abandoned mobilehomes, current
law dictating priority for the proceeds of the sale still
applies when the park owner elects to sell an abandoned
mobilehome, thus ensuring that proceeds may go towards paying
off tax liens or other obligations on the home.
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Related legislation:
AB 587 (Chau): Creates a tax abatement program for mobilehome
owners who cannot transfer title into their names due to
delinquent taxes and fees that may have been incurred by prior
owners. AB 587 is currently pending hearing in the Assembly
Judiciary Committee.
AB 682 (Williams): Would authorize a person to have specified
alterations, conversions, and repairs made to a mobilehome
without filing an application with HCD. AB 682 is currently
pending hearing in the Assembly Committee on Housing and
Community Development.
SB 69 (Kelley) Ch. 446, Statutes of 1995: Provided that an
interest in a mobilehome is established by evidence of a right
to possession of the mobilehome or a security or ownership
interest in the mobilehome.
AB 743 (Nolan) Ch. 564, Statutes of 1991: Revised due process
requirements for mobilehome owners seeking to obtain a court
order declaring the abandonment of a mobilehome.
Double-referral : This bill was double-referred to the Assembly
Judiciary Committee, where it passed 10-0 on April 14, 2015.
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REGISTERED SUPPORT / OPPOSITION:
Support
Western Manufactured Housing Communities Association (Sponsor)
California Mobilehome Parkowners Alliance (CMPA)
Opposition
None on file
Analysis Prepared by:Rebecca Rabovsky / H. & C.D. / (916)
319-2085
AB 999
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