Attacks on MHP Rent Stabilization (Part 3 of 3)

Attacks on MHP Rent Stabilization (Part 3 of 3)

“What You Can Do About it”

The GSMOL Board of Directors thinks California’s mobilehome park rent stabilization ordinances (RSO’s) are under attack.

They are right!

They have asked me to write a three-part article on the situation. Part 1, “What is Going On?”, was published in the Spring 2024 edition of the Californian. (If you missed it, you can find it on the GSMOL website at GSMOL.org.) Part 2, “What Might Happen (or is Already Happening) to Your Park” was published in the Summer 2024 edition of the Californian (same website). This is Part 3 “What You Can Do About It”.

 

My name is Deane Sargent, and I am a finance guy who helps resident groups purchase their mobilehome parks. I’m not an attorney (no legal advice or judgments here), but I have been called as an Expert Witness for residents in rent control disputes (meaning I hang around with attorneys). These are my opinions and do not represent the position of GSMOL or any attorney.

I am also pretty blunt, because I think you NEED to know this stuff!

“What You Can Do About it”

 

As I have worked with resident groups over the years, I have found that most folks who live in mobilehome parks just want to live their lives – work their job, take care of their family and have, what I call, ‘quiet enjoyment of their lifestyle.’ Unless someone was ‘scammed’ when they moved in, residents bought their home, knew the park rules, knew that there was an RSO, knew what their site rent was and what it was expected to be in the future. They got to know their neighbors and became part of the community.

But the MobileHome Park World has changed. Big Money wants your park. They think you are trapped and they can raise rents and deal with you without many limits.

This situation REQUIRES a change of mindset by MHP residents. There are two kinds of animals in this world – Predators and Prey. Predators, like lions, tigers, bears, and humans, have narrow-set eyes on the front of their face to focus on their next meal. Prey, like cows, sheep, goats, and rabbits, have wide-set eyes so they can detect danger and avoid being the next meal. In the current MHP environment, you are PREY!

A cautionary note: The activities you are about to undertake will cause some/many residents in your park to have reactions – some scared, some angry, some reaching out to the park manager/owner seeking information, some hostile to you for ‘rocking the boat’, whatever. So, keep your mouth shut. At the appropriate time, you can inform everyone what is going on (if anything). Otherwise, shut up.

Also, if you don’t have an RSO, contact your GSMOL representative to see if you can get one.

At this point, you probably DO NOT know what the owner has in mind – maybe nothing, maybe attack the RSO, maybe sell the park, maybe close the park. You can’t tell at this point but, like any PREY, be aware about everything.

The FIRST STEP is to ‘look around‘. Sounds silly, but take a look at what is really going on in your park (see RSO Part 2 to refresh your memory) – changes in management, new levels of neglect (or new levels of ‘fix up’), vacant sites, rules enforcement, evictions, etc. Is you owner getting old? New wife? Divorce? Kids showing NO interest in the park. Also, take a look at other parks in your area – anything going on with them – changes in ownership, harassment, etc. Check out your local and state municipal assistance – housing department, local city councilmen, Cal HCD, zoning, etc. The goal is to get a handle on your situation and start to assess your risk of ‘trouble brewing’.

Next, form a leadership team. You can’t do it all yourself. Locate 5-7 folks in the park (all this on the ‘down low’) who are concerned about this stuff. They should be focused on THIS ISSUE, reasonably intelligent, hard working, and willing to be (and become) park leaders. Don’t try to use existing organizations in the park because they are focused on their own agendas. They can also be massive sources of rumor and gossip – which you don’t want at this point. Be positive. If you unfortunately get someone on the committee who is constantly negative and difficult to deal with, grab a shovel and take them to the beach. (Actually, just get them off the team, however you can.)

 

Next, get organized. Everyone on the team will have different strengths. Assign them tasks. Someone might be really good about walking around the park and noticing stuff – have them write it down, take photos. Someone might be really organized and can keep notes for followup with team members. Someone might be really good at computers and the Internet. Have them do research and coordinate communication within the Team. Someone might be particularly charming and should be down at the city/county and the housing department. You get the idea.

Next, reach out. Remember, RSOs are under attack all over California, and some parks have gone, or are going, through what you may be facing. Get on the Internet and search for other park leaders. Believe me, they are thrilled to pass on information about what’s happening in their park and share ideas/stories, etc. Network with any and all parks you have time for and pick up tips.

Next, continue to evaluate. Find out who is on your side and what they can do for you. Equally important, find out who is NOT on your side and probably won’t help. Could be political, money, or just uninterested. Keep track.

Next, think about money. If you have to fight this fight, it is expensive. When the action starts and everyone in the park knows the ‘stakes’ (see details in the next section) , you probably have to go through the park with a bucket and collect some bucks. You will be paying for an attorney and expert witnesses, among other stuff. If, during the time you reached out to other parks in similar situations, you discovered non-profit groups that might be help fund raise or donate, contact them.

Next, think about an attorney. Some folks go their entire lives without having to interact with an attorney (we call them ‘the lucky ones’.) But, in your case, if the battle is looming, you need to know about attorneys and which ones can help and under what circumstances. Remember, the park owners have lots of money and lots of incentives. In a recent RSO arbitration, the park owner wanted a $1,500/mo per site rent increase, from a RSO base of about $500. In a 80 site park, if the owner were to get such an increase (which is unlikely), the park owner would collect an additional $120,000/MONTH, every month ($1,440,000/annually – forever). That park owner spent over $400,000 in legal and expert witness costs. In that case, everything was denied, but you never know. If the owner wins, even a little, he will try (probably successfully) to get YOU to pay some or all of his costs, in addition to the rent increase. RSO actions are a very specialized field and the owner’s attorneys are really good. So you need an attorney with expertise and a track record. A ‘legal aid’ attorney can be of help for individual problems – evictions, unjust rules, other owner BS, but probably not with an RSO action. If the owner is running the park into the ground, you might consider a ‘Failure To Maintain’ (FTM) lawsuit. There are law firms to specialize in these FTM lawsuits. Find them on the Internet. But for RSO actions, you want someone skilled with experience (Not some friend’s nephew who got his law degree last year, has some time and needs clients). You need some real firepower. Check around, search the Internet, call Dave Loop, GSMOL VP for resident-owned parks,(deloop1@sbcglobal.net; 831-688-1293) and discuss your situation with him. He may have recommendations. Good attorneys will already be busy and will ultimately want a ‘retainer’. Don’t pay anything until you and your attorney actually need to fight back. This is also a real good time to seek money from any and all sources, including in the park.

Next, remember to be proactive. OK, so you have done all this stuff and NOTHING happens. So, do you wait a while, then disband the team and go BBQ with a beer? NO. Stay vigilant. Circumstances change, owners mull stuff over, but never go away. So, stay aware and keep on doing what you are doing.

 

Finally, think about buying your park. If you get really tired of this stuff, think about you and your neighbors buying your park. Nothing unites a mobile home park more than a threat of massive rent increases. If you want to talk about buying your park, contact me (deane.f.sargent@gmail.com; 415-271-3919) or Dave Loop (deloop1@sbcglobal.net; 831-688-1293). No cost, no obligation.

Good luck,

Deane