The Negotiating Committee

Summary Report of Meeting held in the

Lazy J Ranch Senior Mobilehome Park, Arcata California

October 25, 2016, 5:00 – 7:00 PM

Topic of Presentation: The City of Arcata’s of new Mobilehome Affordability Strategies Negotiating Committee

The following summary notes are from a meeting held in the Lazy J Ranch Senior Mobilehome Park on October 25, 2016. The meeting was led by City of Arcata Community Development Deputy Director, David Loya. About 40 Lazy J residents attended the meeting.

The City of Arcata wants to retain the mobilehome affordability that already exists and make sure that it is sustainable.

The purpose of the Arcata Mobilehome Affordability Negotiating Committee is:

To reach an agreement between mobilehome park owners and mobilehome owners on key terms that will create and sustain affordability in mobilehome parks in Arcata.

The Negotiating Committee will consist of mobilehome park owners and 3 to 5 representatives of mobilehome owners from each non-resident-owned mobilehome park within the City limits of Arcata.

The Committee will accomplish its work in the following compressed timeframe:

  • The mobilehome-owner delegates from each park will be elected by their respective park residents in November.
  • An interim report will be presented to the Arcata City Council at the December 7, 2016 Council meeting about the progress of the Committee.
  • The final results of the negotiating process will be presented to the City Council at the February 15, 2017 Council meeting.

Loya is responsible for seeing that the negotiation process takes place. He emphasized that the point of the negotiations was not to discuss the actual mechanism (such as MOU or Ordinance or hybrid model) that would affect the agreement between park owners and mobilehome owners. The point will be to discuss the terms (vacancy control, annual rent increases tied to CPI, pass-throughs, etc.) that are important. These important terms would ultimately become codified in some form. Focusing on the form ahead of the substance will be a nonstarter for the negotiation process.

The Arcata City Council asked Development Department Staff to provide template documents for three options along with the summary of the agreed upon terms at its February 2017 meeting. These three options are:

  1. A Memorandum of Understanding (MOU) between the various mobilehome park owners and the City of Arcata,
  2. A space rent stabilization ordinance for Arcata mobilehome parks, and
  3. A hybrid of the MOU and the space-rent stabilization ordinance such as the hybrid adopted by Modesto California in 2007.

The Council identified clearly that they are in favor of working out a solution that has participation on both sides. If the park owners refuse to participate and no agreement can be reached on key terms by February 15, then the Council will likely opt for a space-rent stabilization ordinance so as to preserve mobilehome affordability. Thus the mobilehome owners have leverage to get the park owners to talk. Some in the audience were concerned that the owners wouldn’t come to the table. However, Loya believed that all of the park owners will agree to participate.

He also pointed out that residents shouldn’t just expect that rent control is a foregone conclusion. There is a need to negotiate and for both sides to operate in good faith.

The City staff’s role is to help the mobilehome owners in the negotiations. City staff will sit with the mobilehome owner delegates and support their efforts. There will be a 3rd party facilitator to lead the discussions when the three parties (park owners and mobilehome owners and staff) are present. There will be a note taker who will record the discussions in summary fashion.

Different parks might have different needs. Conceivably the parks might each arrive at different solutions. Although an MOU theoretically could be designed for each park, such a solution was not a likely outcome.

The Negotiating Committee process is based on the process that Thousand Oaks, California used in 2011 to bring agreement between park owners and mobilehome owners in their city.

Someone in the audience expressed a concern that an MOU does not have enough consequences if the park owner does not comply with the MOU. Loya stated that an MOU does have some consequences. If a park owner violates the MOU, the City could possibly set up an abatement process. The MOU is a front-stop. It doesn’t have the force of law. However, the City Council could move to an ordinance if an MOU is violated. An ordinance would keep the MOU in place.

The Modesto California City Council set up a model MOU and asked the mobilehome park owners to sign it. Eight park owners signed it, but the 9th refused. Then the Modesto City Council told the 9th park owner, if you don’t sign the MOU, you will have to abide by the ordinance, which had more stringent provisions than the MOU. Eventually the 9th park owner signed the MOU.

An MOU that persists with ownership transfer is possible. The Arcata City Attorney, Nancy Diamond, will write the resultant MOU or space-rent stabilization ordinance or hybrid.

The park owners have a constitutional right to “fair return on investment.” This return is based on the pre-rent-control year, whatever the base rent is at the time of the MOU or the ordinance. That base rent is one of the concerns of the City Council and thus the reason for the compressed timeframe of the process. The City Council might not want park owners to increase space rents while the negotiations are underway. Loya will look into the possibility that park owners could voluntarily refrain from increasing space rents during the negotiations.

After nominations for delegates in each park, the mobilehome owners will vote on their representatives to the Negotiating Committee. The ballots will be secret ballots with a locked ballot box. The voting process will be very tightly controlled. The City wants to alleviate fears from residents who are afraid of park owner retaliation.

The deadline for nominations was November 1, 2016. The ballots will be created and distributed by the City of Arcata Community Development Department.

Summary Prepared by Linda Derksen

Arcata Mobilehome Ordinance Study Group (AMOSG)

November 22, 2016