HomeMy WebLinkAbout12- Development DEVELOPMENT DEPART ENT
OF THE CITY OF SAN BERNARDINO
REQUEST FOR COMMISSION/COUNCIL ACTION
FROM: KENNETH J. HENDERSON SUBJECT: MOBILE HOME PARK
Executive Director CONVERSION FEASIBILITY
STUDY
DATE: December 15, 1993
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Synopsis of Previous Commission/Council/Committee Action(s):
On November 9, 1993, the Housing Committee received and file the City of San Bernardino Mobile Home Park
Feasibility Study and recommended to the Community Development Commission a
date and time certain for a Mobile Home Conversion Workshop.
On November 15, 1993, the Community Development Commission established December 6, 1993 at 12:00 noon
as the date and time certain for conducting a workshop regarding the City's Mobile Home Conversion Program.
(SYNOPSIS CONTINUED TO NEXT PAGE...)
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Recommended Motion(s).
(Community Development Commission)
MOTION A: That the Community Development Commission authorize Phase II of the existing Consultant
Agreement with the De Anza/London Group pertaining to the development and implementation of a
Mobile Home Park Conversion Program and authorize the Chairman and Executive Director to execute
any documents necessary to effectuate said transaction.
(MOTIONS CONTINUED TO NEXT PAGE ...)
AdW t>i`strator KENNE H J. HEN ERSON
Executive Director
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Contact Person(s): Kenneth J. Henderson/David R. Edgar Phone: 5081
Project Area(s): All Ward(s): 1 - 7
Supporting Data Attached: Staff Report, Executive Summary
FUNDING REQUIREMENTS: Amount: $ N/A Source: N/A
Budget Authority: N/A
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Commission/Council Notes:
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KJH:DRE:GWB:paw:mblhmcon.cdc COMMISSION MEETING AGENDA
Meeting Date: 12/20/93
Agenda Item No: I lie
DEVELOPMENT DEF :TMENT REQUEST FOR COMM 'ION/COUNCIL ACTION
Mobile Home Park Conversion Feasibility Study
December 15, 1993
Page - 2 -
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Synopsis of Previous Commission/Council/Committee Action(s) Continued...
On December 6, 1993, the Community Development Commission conducted a luncheon
Workshop on the City's Mobile Home Conversion Program.
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Recommended Motions continued...
MOTION B: That the Community Development Commission authorize De Anza/London Group to
undertake all activities appropriate and necessary for the formal development of a
Mobile Home Park Conversion Program for all Phase I category Mobile Home
Parks.
MOTION C: That the Community Development Commission authorize De Anza/London to
undertake all activities necessary and appropriate for the formal development of a
mobile home park infrastructure and on-site Mobile home Rehabilitation Program.
MOTION D: That the Community Development Commission authorize De Anza/London Group to
M undertake all activities necessary and appropriate for the formal development of a
Mobile Home Park Site Re-use and Resident Relocation Program.
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KJH:DRE:GWB:paw:mblhmcon.cdc COMMISSION MEETING AGENDA
Meeting Date: 12/20/93
Agenda Item No:
DEVELOPMENT DEPARTM T
STAFF REPORT
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MOBILE HOME PARK CONVERSION FEASIBILITY STUDY
On October 13, 1992, the Housing Committee heard a presentation from Mr. Brooks
London of the London Group regarding mobile home conversion programs. Mr. London's
presentation involved summary descriptions of various conversion programming
alternatives and a discussion of his qualifications. After the discussion, the Committee
took action requesting the item be forwarded to the Community Development
Commission.
At its October 19, 1992 meeting, the Community Development Commission took an action
directing staff to develop and issue a Request for Proposals for mobile home conversion
I services and bring back a staff recommendation to the Commission at its November 16,
1992 meeting. Subsequently, at the November 16, 1992 Community Development
Commission meeting , the DeAnza/London Group proposal was selected and staff was
directed to negotiate an Agreement for Professional Services.
During the last several months beginning March 1, 1993, the Consultants have been
successful in accomplishing the preliminary analysis phase as follows:
• prepare a concise information digest for each park
• prepare a preliminary report on the physical infrastructure of each
park
• prepare a demographic profile of the residents of each park
• determine the level of cooperation likely to be offered by park
owners
• review all statutes and ordinances applicable to the park conversions
• review all public and private funding sources
• determine the most appropriate conversion structure for each park
(condominium, corporate, PUD, cooperative, etc.)
• specific park identification
• resident survey and analysis
preliminary discussions with park owners
• review and analysis of existing ordinances
• review and analysis of current land use regulations
• review and analysis of current rent control ordinances
• review and analysis of any pending rent control litigation
• attend government hearings.
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KJH:DRE:GWB:paw:mblhmcon.cdc COMMISSION MEETING AGENDA
Meeting Date: 12/20/93
i
Agenda Item No:
DEVELOPMENT DEF JMENT STAFF REPORT
Mobile Home Park Conversion Feasibility Study
December 15, 1993
Page Number -2-
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De Anza/London group has now completed the City of San Bernardino Mobile Home Park
Conversion Feasibility Study, copies of which were disseminated to the Commission on
December 1, 1993. This document includes a number of Mobile Home Park policy
recommendations based on the significant findings and conclusions gathered over the past
nine (9) months (Please see attached Executive Summary).
De Anza/London Group concluded that existing Mobile Home Parks fall within three (3)
distinct categories, including:
• Category I Parks (Twenty-nine (29) Parks) - Those mobile home parks which
are most likely/feasible for some form of resident ownership. In addition, once
converted, these parks will most likely offer stabilized housing costs which are
affordable, thereby eliminating the need for City regulation.
• Category II Parks (Eight (8) Parks) - Those mobile home parks which currently
operate within reasonable parameters as mobile home park rental facilities.
However, it is also evident that a number of these facilities require both short and
long-term strategies for maintenance and operation to continue this readily
available affordable rental pool.
• Category III Parks (Seven (7) Parks) - Those mobile home parks which have
reached, or soon will reach the end of their "useful life" as viable mobile home
park housing facilities.
In addition, development and construction of a new mobile home park facility has also been
discussed as a potential component of the City's Comprehensive Housing Strategy. However,
based upon the results of the mobile home park feasibility study, there is currently not an
identifiable "need" or purpose for development of such a mobile home park facility at this
time. For this reason, mobile home park development is not a component of the Mobile
Home Park Conversion Implementation Program.
In order to address the City's stated goals of increasing home ownership opportunities and
maintaining/preserving existing affordable mobile home park facilities, the De AnzaA.ondon
Group has made a number of policy recommendations, including:
• In order to pursue conversion of Category I Mobile Home Parks, that a formal
Mobile Home Park Resident Ownership Conversion Program be developed.
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KJH:DRE:GWB:paw:mblhmcon.cdc COMMISSION MEETING AGENDA
Meeting Date: 12/20/93
Agenda Item No:
DEVELOPMENT DEP. .TMENT STAFF REPORT
Mobile Home Park Conversion Feasibility Study
December 15, 1993
Page Number -3-
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• In order to maintain and approve the quality of Category II Mobile Home Parks
slated to remain as rental facilities, that a formal mobile home park infrastructure
and Mobile Home Rehabilitation Program be developed.
• In order to address those mobile home parks identified within Category III which
currently do not meet existing mobile home park industry and community
standards, that a formal site Reuse and Resident Relocation Program be
developed.
At the Community Development Commission luncheon workshop conducted on December 6,
1993, De Anza/London group provided a video presentation based on the Mobile Home Park
Conversion Feasibility Study. Following that presentation, each of the various elements of
the study along with the individual policy recommendations were discussed in detail. At the
specific recommendation of the Mayor and the Community Development Commission
members present, this item was recommended to the Community Development Commission
for policy consideration.
Based upon the foregoing, staff recommends adoption of the form motions "A", "B", "C" and
KENNETH J. H NDERSON, Executive Director
Development Department
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KJH:DRE:GWB:paw:mblhmcon.cdc COMMISSION MEETING AGENDA
Meeting Date: 12/20/93
Agenda Item No:
r
' DeANZA • LONDON
A California Joint Venture
.a
Mot nol home Park
Conyersion Feasib'llify Sfud-y
Executive Summary
Updated November 30, 1993
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EXECUTIVE S UMMARY
/
De Anza Group, Inc., in association with The London Group (hereinafter "De
Anza•London") was engaged by the City of San Bernardino to analyze each of the
existing forty-four (44) mobilehome parks situated within the City with respect to
the following issues which may be applicable to each of the mobilehome parks:
1
decline of the park's physical plant and the mobilehomes situated
thereon;
• stabilization of monthly housing costs;
/
• increase the opportunities for home ownership;
reduce the transiency associated with rental housing; and,
reduce the conflicts of two-tier ownership and resultant City need to
arbitrate such conflicts.
De AnzaoLondon has completed its initial analysis and, as detailed in the
accompanying MOBILEHOME PARK CONVERSION FEASIBILITY STUDY,
and based on the criteria set forth therein, has determined that the existing
mobilehome parks fall within the following three (3) distinct categories, all of which
if implemented will address the above noted issues:
• CATEGORY I. Category I parks are those which are most likely
0 feasible for resident ownership or, control and, if converted, will most
likely result in, among other things, stabilized housing costs within
the range of current rents, preservation of affordable housing,
elimination of potential deterioration and long-term overall park
infrastructure improvement, as well as eliminate the City's need to
0 further regulate this section of the housing element.
• CATEGORY II. Category II parks are comprised of those mobilehome
parks which operate within reasonable parameters as rental
mobilehome park facilities. While these mobilehome park facilities do
not have the traditional attributes supporting conversion to resident
ownership, they, nonetheless, should be supported as continued rental
operations. However, during the course of our analysis and
investigation, it would appear that a number of these facilities require
both short and long-term strategies with regard to their maintenance
and operation so that this readily available rental housing pool
remains viable both in terms of its economics and quality of operation.
By developing a program which actively involves both residents and
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owners in the process of rehabilitation, the City will have the
opportunity to unify on common ground these otherwise competing
interests.
CATEGORY III. Category III parks are those which may have
reached, or are in the process of reaching, the end of their useful life as
quality facilities providing reasonable housing standards. These
facilities have been in operation for significant periods of time and,
due to the passage of time, deterioration of infrastructure and other
attendant issues, simply would be more appropriately utilized in some
other fashion. Accordingly, this category of mobilehome park facilities
may be viewed as those requiring some degree of re-use analysis to
assure fairness to the owners of the parks, as well as a more favorable
living environment for the residents.
Category I, II and III parks are comprised of the parks noted on the following
tables.
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CATEGORY I PARKS-APPROPRIATE cOR CONVERSION
Park Name Number of spaces Vacant Lots Vacant Homes Homes For Sale
I Acacia Villa 82 3 3 8
Arrowlane 68 1 2 0
Bonanza Trailer Park 52 8 0 1
Country Club 58 1 0 0
Fiesta Hills 141 0 0 14
Friendly Village 85 9 11 7
Glen Aire 131 1 0 6
Herkelrath 67 0 0 4
Lytle Creek 55 4 3 6
Manor MHP 2 69 4 4 4
Mediterranean 81 1 1 3
Meridian Terrace 266 41 15 53
Mountain Shadows 403 NA NA NA
Ninth Street 108 7 1 3
Oasis Palms 13920 11 12
Orangewood 155 15 2 14
Pacific Palms Trailer Park 142 0 0 8
Pepper Villa 51 1 0 4
Petite Chateaux 69 3 1 6
Rancho Meridian 143 6 7 31
Royal Coach 45 2 0 8
Royal York Estates 93 2 3 8
Second Meridian 96 0 0 2
Sequoia Plaza 242 3 3 27
Spa 181 9 9 19
Terra Alta 62 1
0 6
Thunderbird 161 2 0 11
Tropicana 146 5 4 5
Valencia Lea 281 0 0 24
TOTAL 3672 149 80 294
CATF;ORY II PARKS-REM!` IN RENTAL
Park Name Number of spaces Vacant Lots Vacant Homes Homes For Sale
Crestview 38 4 0 0
Cypress Inn 72 14 0 3
Hi-U Trailer Park 71 4 2 0
Highland 6211 0 0
1 Manor MHP 1 60 7 0 1
Rancho Trailer Park 27 0 0 0
Sunset 13 0 0 0
Valley Vista RV Park 15 0 0 0
TOTAL 358 40 2 4
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CATEGORY III PARKS-REUSE PROGRAM
0C
Park Name Number of spaces Vacant Lots Vacant Homes Homes For Sale
Brown's Trailer Park 17 1 1 0
Meadowbrook Trailer Park 21 12 0 0
Shady Nook 27 19 0 0
Trails End 20 0 0 0
Turnbull's Trailer Park 11 0 0 0
Vogue 63 7 2 12
Welcome Inn 421 7 01 0
TOTAL 201 461 3 12
NEW PARK CONSTRUCTION
The development and construction of a new mobilehome park facility has
been raised as one of the alternative approaches the City may undertake as part of
its overall comprehensive housing program. The following are critical elements for
consideration and evaluation:
0 I. PURPOSE
Whenever any new facility is being considered for development, the members
of the community for whose benefit the park is being built, must be clearly
0 identified. There exists a wide range of socio-economic factors prevalent in the
current mobilehome park base, as well as a significant divergence in the various
physical attributes of the existing forty-four (44) mobilehome parks. In light of the
data referred to in Section II hereof, the only clearly identified need is with respect
to those residents currently occupying Category III parks.
0 II. NEED
Any new facility must be integrated with the communities ability, or lack
thereof, to serve that need with existing housing stock. In this regard, we have
identified in Category III parks, approximately 201 spaces, which should be the
subject of a re-use and housing integration program. Category III represents, based
on the available empirical data, the group potentially most needing alternative
housing. Further, our data reflects 189 available vacant lots in Category I and II
facilities and an additional combined readily available alternative housing stock of
380 homes. The existing and readily available in-community mobilehome park
sites and homes could readily absorb, at minimum attendant costs, the Category III
facilities, as well as interim growth and demand for mobilehome park housing.
Thus, development of a new mobilehome park does not serve either the purpose or
need identified during our Phase I analysis.
0 III. IMPACT STUDY
Any new facility must take into formal consideration the overall impact that
may result from implementation of such development, both beneficial and
10 potentially detrimental, which was not within the scope of our feasibility study.
IV. CONCLUSION
Based on the results of our Phase I analysis, the development of a new
mobilehome park is not indicated at this time.
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BENEFITS OF CONVERSION
Mobilehome parks within San Bernardino are a major component of the
City's affordable housing element. A primary goal of the housing element of the
City's general plan is "preservation and improvement of existing housing and
neighborhoods". Another goal is to "remove any obstacle to the provision of
affordable housing". In furtherance of those stated goals, the City has passed a
rent stabilization ordinance. Although the ordinance has the short-term affect of
controlling increasing rents, it does not appear to be a long-term solution to meeting
the City's stated goals.
The ordinance placed the City as the arbiter between mobilehome park
owners and residents. This leads to an increased role by the City in the day-to-day
operation of the parks and leads to a greater likelihood of the City being a party to
litigation, as has been seen in other similarly situated cities. It appears that the
ordinance, coupled with the general economic downturn in the area, has led to
mobilehome park owners not undertaking all necessary improvements to their
parks. As can be seen in the accompanying photographs and video this has led to a
downward spiral in the appearance and quality of many of the parks and the
homes. This result is inconsistent with the aforementioned City goals.
. De Anza•London believe that by converting the parks to resident ownership
there is a much greater likelihood of the City's goals being met. Conversion to
resident ownership leads the City's resources away from being used for arbitration
between two property owners, and instead, uses the resources as facilitator of home
ownership for thousands of it's citizens. Once the two-tiered ownership structure
has ended, pride of ownership increases which leads to a higher quality of life
within this important affordable housing element. If residents own the park, public
sources of money for rehabilitation and financing such as the Federal HOME
Program and the State MPROP Program may be available. This can also lead to an
increase in quality of the housing element. In addition, there is the likelihood of
. increased harmony within these communities due in part to the City's role as
facilitator.
•
THE RESIDENT'S PERSPECTIVE
As discussed in greater detail in the study the benefits of resident ownership
vary depending on the form of ownership selected. Residents are empowered by
having greater control of the communities they live in through their Homeowner's
Association and Board of Directors. Control of the rules and regulations, by-laws,
and covenants, conditions and restrictions generally lead to a better sense of pride
and harmony within the community.
Economically, ownership has a much greater chance of leading to control of
individual housing costs. The only annual increases in such costs are those related
specifically to running and improving the park. Also, where ownership is in a
condominium form, all interest on a mortgage obtained for acquisition is tax-
deductible. In all forms of ownership all future appreciation in value of the
property belongs solely to the resident and is not split, as is currently the case,
between park owner and resident. Finally, the cost of debt is generally much less
once the resident's mobilehome is combined with the land. Currently the cost of
debt on rental mobilehomes is much greater than a real estate loan. Thus the
benefits of ownership by the residents are both social and economic. The by-product
of which enhances the quality of the affordable housing and the neighborhoods in
which they are situated.
Until negotiations for the purchase of the park are concluded, it is impossible
to say how much it will cost the residents to acquire the park. However, for
ownership to be feasible, the monthly cost of ownership must be close to the current
monthly cost of renting their space. It is with that directive that negotiations over
price are undertaken.
PARK OWNERS
For park owners, conversion can mean getting a reasonable and fair price for
the sale of the park in a difficult market in which many of the traditional buyers no
longer exist. As an added inducement to owners, the City may be able to help
provide benefits found within Section 1033 of the Federal Tax Code.
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RECOMMENDATIONS
In order to implement the City's stated goals of increased home ownership,
maintenance of existing affordable mobilehome park housing and the preservation
and improvement thereof, we respectfully request the San Bernardino City Council
adopt the following policies:
CATEGORY I PARKS - Parks Appropriate For Conversion
In order to pursue conversion of the mobilehome parks identified in the body of this
report as Category I parks, authorize De Anza•London in concert with and under
the direction and supervision of the Economic Development Agency to undertake all
necessary and appropriate measures for the formal development of a mobilehome
park resident ownership conversion program.
CATEGORY II PARKS - Remain Rental Parks
i
In order to maintain and upgrade the quality of the mobilehome parks which have
been recommended to remain as rental parks, authorize De Anza•London in concert
with and under the direction and supervision of the Economic Development Agency
to undertake all necessary and appropriate measures for the formal development of
an infrastructure and on-site home rehabilitation program.
CATEGORY III - Re-use Program
To address housing which does not meet existing industry and community
standards as well as to improve the overall quality of the immediate neighborhoods,
authorize De Anza•London in concert with and under the supervision of the
Economic Development Agency to undertake all necessary and appropriate
measures for the formal development of a site re-use and resident relocation
program.
Based on our analysis, we are of the opinion that these policies, if
developed into programs and implemented, will result in direct tangible
benefits for the City, it's mobilehome park residents, mobilehome park
owners and the community at large.
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