Report to Mayor and City Council
Tuesday, March 06, 2018
Written Communications
SUBJECT:
Title
ORDINANCE NO. 17-1622: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA AMENDING ARTICLE IV, CHAPTER 7, OF THE CARSON MUNICIPAL CODE RELATING TO MOBILEHOME SPACE RENT CONTROL (CITY COUNCIL)
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I. SUMMARY
In late 2015, the City Council directed staff and the City Attorney to consider possible updates to its mobilehome park-related ordinances, including the rent control ordinance. On May 2, 2017, City Council introduced for first reading an amendment to the rent control provisions applicable to mobilehome parks.
II. RECOMMENDATION
Recommendation
1. WAIVE READING AND ADOPT ORDINANCE NO. 17-1622: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA AMENDING ARTICLE IV, CHAPTER 7, OF THE CARSON MUNICIPAL CODE RELATING TO MOBILEHOME SPACE RENT CONTROL (CITY COUNCIL)
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III. ALTERNATIVES
Take another action desired by City Council.
IV. BACKGROUND
Based upon the review described above, in May, 2017 staff and the City Attorney’s office recommended that the City Council introduce for first reading Ordinance 17-1622, which would tie future mobilehome park rent increases (with two exceptions) to changes in the Consumer Price Index (“CPI”). Rent increases tied to changes year-over-year in the CPI are a widely utilized methodology among jurisdictions with mobilehome park rent control. In a survey of the 96 jurisdictions in California with rent control regulations, 68 employ either a CPI methodology or establish a fixed percentage (typically in the 5% to 8% range) in calculating annual rent increases (or a combination of the two methodologies limiting the adjustment to the lesser of the two adjustments).
The CPI methodology increases predictability and provides certainty to residents in knowing whether and what rent adjustment to expect, and also provides an easy method for residents to “double check” the rent increase being sought by their park owner (given that it is a relatively simple mathematical computation to determine current rent, the annual change in the CPI, and then calculate the percentage of that change that will be allowed as a rent increase). It also benefits park owners, particularly smaller park owners that cannot pull together the application materials to receive regular rent increases. From an administrative perspective, a CPI methodology would reduce the number of lengthy MRRB hearings because this methodology is largely administrative (meaning, no hearing would be required before the MRRB to calculate a CPI rent adjustment) and jurisdictions which have employed the CPI methodology have a greatly reduced litigation exposure because of the simplicity of what is largely an administrative process.
At the direction of the City Council, Staff and the City Attorney’s Office engaged in community outreach prior to the first reading, briefing the residents on the park closure ordinance and the proposed CPI ordinance in two large public meetings. Additional efforts continued on the CPI ordinance after introduction, particularly with certain owners’ representatives, in an effort to maintain transparency. That included at least three meetings with park owner representatives. Generally speaking, park residents favor the change because of the certainty of the CPI, and most owners are in favor of the change because of the reduced administrative burden to receive regular rent increases.
Those additional meetings did not result in any proposed changes to the ordinance, so it is presented for second reading and adoption.
V. FISCAL IMPACT
The revised ordinance could result in up to $500,000 in savings to the City annually.
VI. EXHIBITS
1. May 2, 2017 City Council Staff Report (pgs. 3-8)
2. ORDINANCE NO. 17-1622: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CARSON, CALIFORNIA AMENDING ARTICLE IV, CHAPTER 7, OF THE CARSON MUNICIPAL CODE RELATING TO MOBILEHOME SPACE RENT CONTROL (pgs. 9-14)
Prepared by: John S. Raymond, Director of Community Development