County to fight for mobile home rent control, despite $15 million suit

Wednesday, October 28, 2009
Kurtis Alexander
Santa Cruz Sentinel

SOQUEL -- Roger Willenborg, like many residents at Alimur Mobile Home Park, fears he and his family could soon be on the street if the county doesn't win its fight to protect rent control at the Soquel Drive park.

"There's 147 units here that would no longer be low-income housing," said Willenborg, 63, who lives with his wife and son in a two-bedroom, two-bath coach. "Where will the units go? Where will residents go?"

And that's just the tip of the iceberg, say county leaders, who plan to press their case for Willenborg and his neighbors despite a new $15 million lawsuit. Losing rent control at Alimur, the county says, could open the flood gates for similar losses at some 50 other mobile home parks in the county, many of which are home to the area's least well-off who can't afford to go anywhere else.

"It'll be a domino effect if we step down and you'll see lots of other parks fall," said county Supervisor John Leopold. "And we're not talking about people with means. These are the most vulnerable people in Santa Cruz County."

At issue is a seemingly innocuous point: whether park owners, like the one at Alimur, should be allowed to convert the rented parcels in their parks to owner-occupied parcels. Park owners plug such conversions as an opportunity for renters to become homeowners, but the tenants -- who own their coaches, not the land beneath -- worry they won't have the means to buy their parcels. Though they'll still have the option to rent, the conversion, by law, does away with local rent control provisions, which means their rents could quickly escalate.

"What the owner really wants to do at Alimur, I believe, is clear off all the homes," said Leopold, who like many believes big profits come with selling off the subdivided lots.

The county, which has say over such subdivisions, has so far denied approval for the Alimur conversion, prompting a lawsuit and a $15.6 million damage complaint from park owner Paul Goldstone, an out-of-county businessman.

Goldstone's attorney, Thomas Casparian, says his client should be allowed to capitalize on his investment and insists he's doing it in a way that benefits the tenants -- selling off the park to give them ownership and greater control of the common facilities.

But legally, the county does not have the right to block the conversion since it meets state terms, says Casparian, who works for Santa Monica firm Gilchrist and Rutter.

"State laws completely and totally pre-empt local authority," he said. "The county acted illegally when it denied the conversion application."

The debate, which has played out similarly in the cities of Santa Cruz and Capitola, leaves mobile home residents like Willenborg in a tough spot.

If Willenborg, who lives on a fixed income, wanted to sell his home and avoid problems that might come, he would not recoup his equity. Park residences that have historically sold for a $100,000 or more are no longer worth more than the mobile homes themselves since the rent controls, which have kept property values high, are now at risk.

"Our homes aren't worth anything because nobody wants to buy into here," he said.

If Willenborg opts to stay at the park and the conversion proceeds, he would either have to buy the parcel beneath his coach at whatever price the owner demands or continue paying rent without local rent protections and on the owner's terms.

While Goldstone has pledged to keep rents affordable for lower-income residents, Willenborg and others are not only skeptical, but worry about will happen to their family in line for their homes when they're no longer around.

"If my wife couldn't afford to live here when I die, she could become homeless," Willenborg said.

The legal posturing over the park has grown increasingly complex.

County attorneys originally argued against the Alimur conversion because a local ordinance required the wishes of residents to be considered. A survey found 119 residents at Alimur were against the subdivision and only two were for it. However, a recent court decision over a Sonoma County park dismissed a similar local ordinance, and Santa Cruz County officials consequently decided to rescind their ordinance.

Now, the county is arguing it can deny the Alimur conversion because of state law alone. The state requires the survey of residents on how they feel about the conversion but it is less clear about the weight residents should have in the conversion decision.

Casparian insists the survey results don't have to have any bearing on the outcome, though the county maintains otherwise. This sticking point will be central to the future legal debate.

The owner's case against the county is expected to be heard in court next month.

Meanwhile, the county, in addition to rescinding its conversion ordinance, has tossed its April decision denying the Alimur conversion and has scheduled to rehear the issue on the merits of the state law. That rehearing was slated to happen this month, but was postponed until December.

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