Mobile home parks in the city of Santa Barbara will no longer be able to raise space rental fees beyond 10% between occupants.
Members of City Council approved the addition of vacancy control to the City’s mobile home park laws in the hopes the change would preserve a source of affordable housing.
“Mobile home housing really is one of the last bastions of affordable housing, certainly in the state of California and I think it’s very much true here in our own community,” councilmember Meagan Harmon said. “And for that reason, it’s absolutely imperative that we take any and all steps available to us to maintain the stability of that housing stock.”
The decision was unanimous — despite claims from Flamingo Mobile Home Park that the ordinance is illegal.
Vacancy control, atop pre-existing rent control, was established in the City’s 1984 mobile home ordinance.
A judge in the Ninth Circuit Court of Appeals ruled the laws illegal, stating it took control away from the owners and gave homeowners an unequal share of power.
City Attorney Ariel Calonne said a 1992 U.S. Supreme Court case “cut the legs out from under the reasoning of the Ninth Circuit Court of Appeals.”
The circuit court’s opinion wasn’t directly overruled, but Mr. Calonne believes the 1992 decision gives the City the legal grounds to reinstate vacancy control. Flamingo’s attorney disagrees.
The idea to revisit vacancy control erupted out of discussions of a senior mobile home park overlay.
The City is currently in the process of establishing a permanent rule to lock in senior mobile home parks to maintain 80% residency at 55 years of age and older.
City staff are only aware of one senior park, Flamingo Mobile Home Park, which began the conversion to a family park last winter. City Council maintains that it halted the park’s transition when it enacted a temporary ordinance.
Pacific Current Partners, California-based mobile-home and RV park investors, bought the park in 2018.
Brad Hill, partner at PCP, told Council that PCP invested in Flamingo under the expectation that Santa Barbara would remain without vacancy control.
“This proposed ordinance that targets our property will lead to a significant value impairment that goes too far and could not have been reasonably anticipated,” he said.
Members of City Council disagreed and pointed to the County of Santa Barbara’s vacancy control of 10% as reason to expect similar provisions in the city.
“I believe that there are companies that go around looking for these types of opportunities where these protections that aren’t in place, and to expect that those protections aren’t put in place is extremely naive from a business standpoint,” councilmember Mike Jordan said.
PCP submitted mobile homes sales data, ranging from 2019-2021, to the City Council. The cost of mobile homes in county parks is just over double the cost of homes within the city.
Mr. Hill and PCP’s attorney James Ballantine also argue that vacancy control inflates the sale price of the homes in the park. They maintain the higher mortgage payments would be less affordable than the at-market space rent.
In a document sent to the City, PCP anticipates its annual revenue 10 years from now to be $990,296 under 10% vacancy control. If it could raise rent between occupants, it projects a revenue of $1,638,407.
Dan Villano, one of Flamingo’s residents, gave a public comment to City Council to advocate for the homeowners in the park.
“The land would be useless without people like us buying a mobile home and putting it on their space — so we are, in fact, equal partners,” he said.
Mr. Calonne added an arbitration clause “to level the playing field between park owners, with offices on Market Street in San Francisco and the ability to hire lawyers at great expense, and the people who are living in Santa Barbara in our mobile home parks,” he said.
(PCP’s office is located on Market Street in San Francisco.)
The provision allows residents to sue for triple damages if the park owner violates the ordinance. The City Attorney’s Office may also help enforce the ordinance.
The City Council requested the addition that litigation will occur in a court agreed upon by both parties. If they can’t agree, litigation will be in Santa Barbara.
The addition will be voted on in the next City Council meeting, scheduled for 2 p.m. next Tuesday.